Federal Agriculture Improvement and Reform Act of 1996
PL 104-127 (H.R.2854), enacted 04/04/1996

110 STAT. 888 
PUBLIC LAW 104-127—APR. 4, 1996 
Public Law 104-127 
104th Congress 
Apr. 4, 1996 
[H.R. 2854] 
Federal 
Agriculture 
Improvement 
and Reform Act 
of 1996. 
7 u s e 7201 note. 
An Act 
To modify the operation of certain agricultural programs. 
Be it enacted by the Senate and House of Representatives 
of 
the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—^This Act may be cited as the "Federal Agri-
culture Improvement and Reform Act of 1996". 
(b) TABLE OF CONTENTS.—^The table of contents of this Act 
is as follows: 
Sec. 1. Short title; table of contents. 
TITLE I—AGRICULTURAL MARKET TRANSITION ACT 
Subtitle A—Short Title, Purpose, and Definitions 
Sec. 101. Short title and purpose. 
Sec. 102. Definitions. 
Subtitle B—Production Flexibility Contracts 
Sec. 111. Authorization for use of production flexibility contracts. 
Sec. 112. Elements of contracts. 
Sec. 113. Amounts available for contract payments. 
Sec. 114. Determination of contract payments under contracts. 
Sec. 115. Payment limitations. 
Sec. 116. Violations of contract. 
Sec. 117. Transfer or change of interest in lands subject to contract. 
Sec. 118. Planting flexibility. 
Subtitle C—^Nonrecourse Marketing Assistance Loans and Loan Deficiency 
Payments 
Sec. 131. Availability of nonrecourse marketing assistance loans. 
Sec. 132. Loan rates for marketing assistance loans. 
Sec. 133. Term of loans. 
Sec. 134. Repayment of loans. 
Sec. 135. Loan deficiency payments. 
Sec. 136. Special marketing loan provisions for upland cotton. 
Sec. 137. Availability of recourse loans for high moisture feed grains and seed cot-
ton. 
Subtitle D—Other Commodities 
CHAPTER 1—DAIRY 
Milk price support program. 
Recourse loan program for commercial processors of dairy products. 
Consolidation and reform of Federal milk marketing orders. 
Effect on fluid milk standards in State of California. 
Milk manufacturing marketing adjustment. 
Promotion. 
Northeast Interstate Dairy Compact. 
Dairy export incentive program. 
Authority to assist in establishment and maintenance of one or more ex-
port trading companies. 
Standby authority to indicate entity best suited to provide international 
market development and export services. 
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150. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 889 
Sec. 151. Study and report regarding potential impact of Uruguay Round on prices, 
income, and Government purchases. 
Sec. 152. Promotion of United States dairy products in international markets 
through dairy promotion program. 
CHAPTER 2—PEANUTS AND SUGAR 
Sec. 155. Peanut program. 
Sec. 156. Sugar program. 
Subtitle E—^Administration 
Sec. 161. Administration. 
Sec. 162. Adjustments of loans. 
Sec. 163. Commodity Credit Corporation interest rate. 
Sec. 164. Personal liability of producers for deficiencies. 
Sec. 165. Commodity Credit Corporation sales price restrictions. 
Subtitle F—Permanent Price Support Authority 
Sec. 171. Suspension and repeal of permanent price support authority. 
Sec. 172. Effect of amendments. 
Subtitle G—Commission on 21st Century Production Agriculture 
Sec. 181. Establishment. 
Sec. 182. Composition. 
Sec. 183. Comprehensive review of past and future of production agriculture. 
Sec. 184. Reports. 
Sec. 185. Powers. 
Sec. 186. Commission procedures. 
Sec. 187. Personnel matters. 
Sec. 188. Termination of Commission. 
Subtitle H—Miscellaneous Commodity Provisions 
Sec. 191. Options pilot program. 
Sec. 192. Risk management education. 
Sec. 193. Crop instu-ance. 
Sec. 194. Establishment of Office of Risk Management. 
Sec. 195. Revenue insurance. 
Sec. 196. Administration and operation of noninsured crop assistance program. 
TITLE II—AGRICULTURAL TRADE 
Subtitle A—^Amendments to Agricultural Trade Development and Assistance Act of 
1954 and Related Statutes 
Sec. 201. Food aid to developing countries. 
Sec. 202. Trade and development assistance. 
Sec. 203. Agreements regarding eligible countries and private entities. 
Sec. 204. Terms and conditions of sales. 
Sec. 205. Use of local currency payment. 
Sec. 206. Value-added foods. 
Sec. 207. Eligible organizations. 
Sec. 208. Generation and use of foreign currencies. 
Sec. 209. General levels of assistance under Public Law 480. 
Sec. 210. Food Aid Consultative Group. 
Sec. 211. Support of nongovernmental organizations. 
Sec. 212. Commodity determinations. 
Sec. 213. General provisions. 
Sec. 214. Agreements. 
Sec. 215. Use of Commodity Credit Corporation. 
Sec. 216. Administrative provisions. 
Sec. 217. Expiration date. 
Sec. 218. Regulations. 
Sec. 219. Independent evaluation of programs. 
Sec. 220. Authorization of appropriations. 
Sec. 221. Coordination of foreign assistance programs. 
Sec. 222. Micronutrient fortification pilot program. 
Sec. 223. Use of certain local currency. 
Sec. 224. Farmer-to-farmer program. 
Sec. 225. Food security commodity reserve. 
Sec. 226. Protein byproducts derived from alcohol fiiel production. 
Sec. 227. Food for progress program. 
Sec. 228. Use of foreign currency proceeds from export sales financing. 
110 STAT. 890 
PUBLIC LAW 104-127—APR. 4, 1996 
Sec. 229. Stimvilation of foreign production. 
Subtitle B—^Amendments to Agricultural Trade Act of 1978 
Sec. 241. Agricultural export promotion strategy. 
Sec. 242. Implementation of commitments under Uruguay Round Agreements. 
Sec. 243. Export credits. 
Sec. 244. Market access program. 
Sec. 245. Export enhancement program. 
Sec. 246. Arrival certification. 
Sec. 247. Compliance. 
Sec. 248. Regulations. 
Sec. 249. Trade compensation and assistance programs. 
Sec. 250. Foreign Agricultural Service. 
Sec. 251. Reports. 
Sec. 252. Foreign market development cooperator program. 
Subtitle C—^Miscellaneous Agricultural Trade Provisions 
Sec. 261. Edward R. Madigan United States Agricvdtural Export Excellence Award. 
Sec. 262. Reporting requirements relating to tobacco. 
Sec. 263. Triggered export enhancement. 
Sec. 264. Disposition of commodities to prevent waste. 
Sec. 265. Debt-for-health-and-protection swap. 
Sec. 266. Policy on expansion of international markets. 
Sec. 267. Policy on maintenance and development of export markets. 
Sec. 268. Policy on trade liberalization. 
Sec. 269. Agricultural trade negotiaticms. 
Sec. 270. Policy on unfair trade practices. 
Sec. 271. Agricultural aid and trade missions. 
Sec. 272. Annual reports by agricultural attaches. 
Sec. 273. World livestock market price information. 
Sec. 274. Orderly liquidation of stocks. 
Sec. 275. Sales of extra long staple cotton. 
Sec. 276. Regulations. 
Sec. 277. Emerging markets. 
Sec. 278. Reimburs^nent for overhead expenses. 
Sec. 279. Labeling of domestic and imported lamb and mutton. 
Sec. 280. Import assistance for CBI beneficiary countries and the Philippines. 
Sec. 281. Studies, reports, and other provisions. 
Sec. 282. Sense of Congress concerning multilateral disciplines on credit guaran-
tees. 
Sec. 283. International Cotton Adviswy Committee. 
TITLE III—CONSERVATION 
Subtitle A—Definitions 
Sec. 301. Definitions applicable to highly erodible cropland conservation. 
Subtitle B—Highly ErodiWe Land Conservation 
Sec. 311. Program ineligibility. 
Sec. 312. Conservation reserve lands. 
Sec. 313. Good faith exemption. 
Sec. 314. Expedited procedures for granting variances from conservation plans. 
Sec. 315. Development and implementation of conservation plans and conservation 
systems. 
Sec. 316. Investigation of possible compliance deficiencies. 
Sec. 317. Wind erosion estimation pilot project. 
Subtitle C—Wetland Conservation 
Sec. 321. Program ineligibility. 
Sec. 322. Delineation of wetlands; exemptions to program ineligibility. 
Sec. 323. Consultation and cooperation requirements. 
Sec. 324. Application of program ineligibility to affiliated persons. 
Sec. 325. Clarification of definition of agricultural lands in memorandum of agree-
ment. 
Sec. 326. Effective date. 
Subtitle D—Environmental Conservation Acreage Reserve Program 
Sec. 331. Environmental conservation acreage reserve program. 
Sec. 332. Conservation reserve program. 
Sec. 333. Wetlands reserve program. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 891 
Sec. 334. Environmental quality incentives program. 
Sec. 335. Conservation farm option. 
Sec. 336. Repeal of superseded authorities. 
Subtitle E—Conservation Funding and Administration 
Sec. 341. Conservation funding and administration. 
Sec. 342. State technical committees. 
Sec. 343. Public notice and comment for revisions to certain State technical guides. 
Subtitle F—National Natural Resources Conservation Foundation 
Sec. 351. Short title. 
Sec. 352. Definitions. 
Sec. 353. National Natural Resources Conservation Foundation. 
Sec. 354. Composition and operation. 
Sec. 355. Officers and employees. 
Sec. 356. Corporate powers and obligations of the Foundation. 
Sec. 357. Administrative services and support. 
Sec. 358. Audits and petition of Attorney General for equitable relief. 
Sec. 359. Release from liability. 
Sec. 360. Authorization of appropriations. 
Subtitle G—Forestry 
Sec. 371. Office of International Forestry. 
Sec. 372. Cooperative work for protection, management, and improvement of Na-
tional Forest System. 
Sec. 373. Forestry incentives program. 
Sec. 374. Optional State grants for forest legacy program. 
Subtitle H—Miscellaneous Conservation Provisions 
Sec. 381. Conservation activities of Commodity Credit Corporation. 
Sec. 382. Floodplain easements. 
Sec. 383. Resource conservation and development program. 
Sec. 384. Repeal of report requirement. 
Sec. 385. Flood risk reduction. 
Sec. 386. Conservation of private grazing land. 
Sec. 387. Wildlife habitat incentives program. 
Sec. 388. Farmland protection program. 
Sec. 389. Interim moratorium on bypass flows. 
Sec. 390. Everglades ecosystem restoration. 
Sec. 391. Agricultural air quality research oversight. 
TITLE IV—NUTRITION ASSISTANCE 
Sec. 401. Food stamp program. 
Sec. 402. Commodity distribution program; commodity supplemental food program. 
Sec. 403. Emergency food assistance program. 
Sec. 404. Soup kitchen and food bank program. 
Sec. 405. National commodity processing. 
TITLE V—AGRICULTURAL PROMOTION 
Subtitle A—Commodity Promotion and Evaluation 
Sec. 501. Commodity promotion and evaluation. 
Subtitle B—Issuance of Orders for Promotion, Research, and Information Activities 
Regarding Agricultural Commodities 
Sec. 511. Short title. 
Sec. 512. Findings and purpose. 
Sec. 513. Definitions. 
Sec. 514. Issuance of orders. 
Sec. 515. Required terms in orders. 
Sec. 516. Permissive terms in orders. 
Sec. 517. Assessments. 
Sec. 518. Referenda. 
Sec. 519. Petition and review of orders. 
Sec. 520. Enforcement. 
Sec. 521. Investigations and power to subpoena. 
Sec. 522. Suspension or termination. 
Sec. 523. Amendments to orders. 
Sec. 524. Effect on other laws. 
Sec. 525. Regulations. 
110 STAT. 892 
PUBLIC LAW 104-127—APR. 4, 1996 
Sec. 526. Authorization of appropriations. 
Subtitle C—Canola and Rapeseed 
Sec. 531. Short title. 
Sec. 532. Findings and declaration of policy. 
Sec. 533. Definitions. 
Sec. 534. Issuance and amendment of orders. 
Sec. 535. Required terms in orders. 
Sec. 536. Assessments. 
Sec. 537. Referenda. 
Sec. 538. Petition and review. 
Sec. 539. Enforcement. 
Sec. 540. Investigations and power to subpoena. 
Sec. 541. Suspension or termination. 
Sec. 542. Regulations. 
Sec. 543. Authorization of appropriations. 
Subtitle D—Kiwifruit 
Sec. 551. Short title. 
Sec. 552. Findings and purposes. 
Sec. 553. Definitions. 
Sec. 554. Issuance of orders. 
Sec. 555. National Kiwifruit Board. 
Sec. 556. Required terms in order. 
Sec. 557. Permissive terms in order. 
Sec. 558. Petition and review. 
Sec. 559. Enforcement. 
Sec. 560. Investigations and power to subpoena. 
Sec. 561. Referenda. 
Sec. 562. Suspension or termination. 
Sec. 563. Regulations. 
Sec. 564. Authorization of appropriations. 
Subtitle E—Popcorn 
Sec. 571. Short title. 
Sec. 572. Findings and declaration of policy. 
Sec. 573. Definitions. 
Sec. 574. Issuance of orders. 
Sec. 575. Required terms in orders. 
Sec. 576. Referenda. 
Sec. 577. Petition and review. 
Sec. 578. Enforcement. 
Sec. 579. Investigations and power to subpoena. 
Sec. 580. Relation to other programs. 
Sec. 581. Regulations. 
Sec. 582. Authorization of appropriations. 
Subtitle F—Miscellaneous 
Sec. 591. Maintenance of records for honey promotion program. 
TITLE VI—CREDIT 
Subtitle A—Farm Ownership Loans 
Sec. 601. Limitation on direct farm ownership loans. 
Sec. 602. Purposes of loans. 
Sec. 603. Soil and water conservation and protection. 
Sec. 604. Interest rate requirements. 
Sec. 605. Insurance of loans. 
Sec. 606. Loans guaranteed. 
Subtitle B—Operating Loans 
Sec. 611. Limitation on direct operating loans. 
Sec. 612. Purposes of operating loans. 
Sec. 613. Participation in loans. 
Sec. 614. Line-of-credit loans. 
Sec. 615. Insurance of operating loans. 
Sec. 616. Special assistance for beginning farmers and ranchers. 
Sec. 617. Limitation on period for which borrowers are eligible for guaranteed as-
sistance. 
Subtitle C—Emergency Loans 
Sec. 621. Hazard insurance requirement. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 893 
Sec. 622. Narrowing of authority to waive application of the credit elsewhere test. 
Sec. 623. Linking of emergency loans for crop or livestock changes to natural disas-
ters. 
Sec. 624. Maximum emergency loan indebtedness. 
Sec. 625. Establishment of date for emergency loan asset valuation. 
Sec. 626. Insurance of emergency loans. 
Subtitle D—Administrative 
Provisions 
Sec. 631. Temporary authority to enter into contracts. 
Sec. 632. Use of collection agencies. 
Sec. 633. Notice of loan service programs. 
Sec. 634. Clarification of written statement required of borrowers. 
Sec. 635. Annual review of the credit history, business operation, and continued eli-
gibility of a borrower. 
Sec. 636. Extension of veterans preference. 
Sec. 637. Verification of the credit elsewhere test. 
Sec. 638. Sale of property. 
Sec. 639. Easements on inventoried property. 
Sec. 640. Definitions. 
Sec. 641. Authorization for loans. 
Sec. 642. Contracts on loan security properties. 
Sec. 643. List of certified lenders and inventory property demonstration project. 
Sec. 644. Homestead property. 
Sec. 645. Restructimng. 
Sec. 646. Transfer of inventory land for conservation purposes. 
Sec. 647. Implementation of target participation rates. 
Sec. 648. Delinquent borrowers. 
Sec. 649. Short form certification of farm program borrower compliance. 
Sec. 650. Credit study. 
Subtitle E—General Provisions 
Sec. 661. Conforming amendments. 
Sec. 662. Electronic filing of effective financing statements under the clear title pro-
visions of the Food Security Act of 1985. 
Sec. 663. Effective date. 
TITLE VII—RURAL DEVELOPMENT 
Subtitle A—^Amendments to the Food, Agriculture, Conservation, and Trade Act of 
1990 
CHAPTER 1—GENERAL PROVISIONS 
Sec. 701. Rural investment partnerships. 
Sec. 702. Water and waste facility financing. 
Sec. 703. Rural wastewater circuit rider program. 
Sec. 704. Telemedicine and distance learning services in rural areas. 
Sec. 705. Limitation on authorization of appropriations for rural technology grants. 
Sec. 706. Demonstration projects. 
Sec. 707. Monitoring the economic progress of rural America. 
Sec. 708. Analysis by Office of Technology Assessment. 
Sec. 709. Rural health infrastructure improvement. 
Sec. 710. Census of agriculture. 
Sec. 711. Study of the transportation of fertilizer and agricultural chemicals to 
farmers. 
CHAPTER 2—ALTERNATIVE AGRICULTURAL RESEARCH AND COMMERCIALIZATION 
Sec. 721. Definitions. 
Sec. 722. Alternative Agricultural Research and Commercialization Corporation. 
Sec. 723. Board of directors, employees, and facilities. 
Sec. 724. Research and development grants, contracts, and agreements. 
Sec. 725. Commercialization assistance. 
Sec. 726. General rules regarding the provision of assistance. 
Sec. 727. Regional centers. 
Sec. 728. Alternative Agricultural Research and Commercialization 
Revolving 
Fund. 
Sec. 729. Procurement preferences for products receiving Corporation assistance. 
Sec. 730. Business plan and feasibility study and report. 
Subtitle B—^Amendments to the Consolidated Farm and Rural Development Act 
CHAPTER 1—GENERAL PROVISIONS 
Sec. 741. Water and waste facility loans and grants. 
110 STAT. 894 
PUBLIC LAW 104-127—APR. 4, 1996 
Sec. 742. Emergency community water assistance grant program for small commu-
nities. 
Sec. 743. Emergency community water assistance grant program for smallest com-
munities. 
Sec. 744. Agricultural Credit Insurance Fund. 
Sec. 745. Rural Development Insurance Fund. 
Sec. 746. Insured watershed and resource conservation and development loans. 
Sec. 747. Rural industrialization assistance. 
Sec. 748. Administration. 
Sec. 749. Authorization of appropriations. 
Sec. 750. Testimony before congressional committees. 
Sec. 751. Prohibition on use of loans for certain purposes. 
Sec. 752. Rural development certified lenders program. 
Sec. 753. System for delivery of certain rural development programs. 
Sec. 754. State rural economic development review panel. 
Sec. 755. Limited transfer authority of loan amounts. 
Sec. 756. Allocation and transfer of loan guarantee authority. 
Sec. 757. Water systems for rural and Native villages in Alaska. 
Sec. 758. Application requirements relating to water and waste disposal loan and 
grant programs. 
Sec. 759. National Sheep Industry Improvement Center. 
Sec. 759A. Cooperative agreements. 
Sec. 759B. Eligibility for grants to broadcasting systems. 
CHAPTER 2—RURAL COMMUNITY ADVANCEMENT PROGRAM 
\ 
Sec. 761. Rural community advancement program. 
Sec. 762. Simplified, uniform application for assistance from all Federal rural de-
velopment programs. 
Sec. 763. Community facilities grant program. 
Subtitle C—^Amendments to the Rural Electrification Act of 1936 
Sec. 771. Purposes; investigations and reports. 
Sec. 772. Authorization of appropriations. 
Sec. 773. Loans for electrical plants and transmission lines. 
Sec. 774. Loans for electrical and plumbing equipment. 
Sec. 775. Testimony on budget requests. 
Sec. 776. Transfer of functions of administration created by Executive order. 
Sec. 777. Annual report. 
Sec. 778. Prohibition on restricting water and waste facility services to electric cus-
tomers. 
Sec. 779. Telephone loan terms and conditions. 
Sec. 780. Privatization program. 
Sec. 781. Rural Business Incubator Fund. 
Subtitle D—Miscellaneous Rural Development Provisions 
Sec. 791. Interest rate formula. 
Sec. 792. Grants for financially stressed farmers, dislocated farmers, and rural 
families. 
Sec. 793. Fund for Rural America. 
Sec. 794. Under Secretary of Agriculture for Rural Economic and Community De-
velopment renamed the Under Secretary of Agriculture for Rural Devel-
opment. 
TITLE VIII—RESEARCH, EXTENSION, AND EDUCATION 
Subtitle A—Modification and Extension of Activities Under 1977 Act 
Sec. 801. Purposes of agricultural research, extension, and education. 
Sec. 802. National Agricultural Research, Extension, Education, and Economics Ad-
visory Board. 
Sec. 803. Federal Advisory Committee Act exemption for Federal-State cooperative 
programs. 
Sec. 804. Coordination and planning of agricultural research, extension, and edu-
cation. 
Sec. 805. Grants and fellowships for food and agricultural sciences education. 
Sec. 806. Grants for research on the production and marketing of alcohols and in-
dustrial hydrocarbons from agricultural commodities and forest prod-
ucts. 
Sec. 807. Policy research centers. 
Sec. 808. Human nutrition intervention and health promotion research program. 
Sec. 809. Food and nutrition education program. 
Sec. 810. Purposes and findings relating to animal health and disease research. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 895 
Sec. 811. Animal health and disease continuing research. 
Sec. 812. Animal health and disease national or regional research. 
Sec. 813. Grant program to upgi'ade agricultural and food sciences facilities at 1890 
land-grant colleges. 
Sec. 814. National research and training centennial centers. 
Sec. 815. Programs for Hispanic-serving institutions. 
Sec. 816. International agricultviral research and extension. 
Sec. 817. Authorization of appropriations for agricultural research programs. 
Sec. 818. Authorization of appropriations for extension education. 
Sec. 819. Supplemental and alternative crops research. 
Sec. 820. Aquaculture assistance programs. 
Sec. 821. Authorization of appropriations for rangeland research. 
Subtitle B—Modification and Extension of Activities Under 1990 Act 
Sec. 831. Water quality research, education, and coordination. 
Sec. 832, National genetics resources program. 
Sec. 833. National agricultural weather information system. 
Sec. 834. Livestock product safety and inspection program. 
Sec. 835. Plant genome mapping program. 
Sec. 836. Certain specialized research programs. 
Sec. 837. Agricultural telecommunications program. 
Sec. 838. National centers for agricultural product quality research. 
Sec. 839. Red meat safety research center. 
Sec. 840. Indian reservation extension agent program. 
Sec. 841. Assistive technology program for farmers with disabilities. 
Sec. 842. National rural information center clearinghouse. 
Sec. 843. Global climate change. 
Subtitle C—Repeal of Certain Activities and Authorities 
Sec. 851. Subcommittee on Food, Agricultural, and Forestry Research. 
Sec. 852. Joint Council on Food and Agricultural Sciences. 
Sec. 853. Agricultural Science and Technology Review Board. 
Sec. 854. Animal Health Science Research Advisory Board. 
Sec. 855. Resident instruction program at 1890 land-grant colleges. 
Sec. 856. Grants to States for international trade development centers. 
Sec. 857. Rangeland research. 
Sec. 858. Composting research and extension program. 
Sec. 859. Education program regarding handling of agricultural chemicals and agri-
cultural chemical containers. 
Sec. 860. Program administration regarding sustainable agriculture research and 
education. 
Sec. 861. Research regarding production, preparation, processing, handling, and 
storage of agricultural products. 
Sec. 862. Plant and animal pest and disease control program. 
Sec. 863. Certain specialized research programs. 
Sec. 864. Commission on agricultural research facilities. 
Sec. 865. Special grant to study constraints on agricultural trade. 
Sec. 866. Pilot project to coordinate food and nutrition education programs. 
Sec. 867. Demonstration areas for rural economic development. 
Sec. 868. Technical advisory committee regarding global climate change. 
Sec. 869. Committee of nine under Hatch Act of 1887. 
Sec. 870. Cotton crop reports. 
Sec. 871. Rural economic and business development and additional research grants 
under title V of Rural Development Act of 1972. 
Sec. 872. Human nutrition research. 
Sec. 873. Grants to upgrade 1890 land-grant college extension facilities. 
Sec. 874. Indian subsistence fanning demonstration grant program. 
Subtitle D—Miscellaneous Research Provisions 
Sec. 881. Critical agricultural materials research. 
Sec. 882. Memorandum of agreement regarding 1994 Institutions. 
Sec. 883. Smith-Lever Act funding for 1890 land-grant colleges, including Tuskegee 
University. 
Sec. 884. Agricultural research facilities. 
Sec. 885. National competitive research initiative. 
Sec. 886. Rural development research and education. 
Sec. 887. Dairy goat research program. 
Sec. 888. Competitive grants for research to eradicate and control brown citrus 
aphid and citrus tristeza virus. 
Sec. 889. Stuttgart National Aquaculture Research Center. 
Sec. 890. Expansion of authorities related to National Arboretum. 
110 STAT. 896 
PUBLIC LAW 104-127—APR. 4, 1996 
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891. Transfer of aquacultural research center. 
892. Use of remote sensing data and other data to anticipate potential food, 
feed, and fiber shortages or excesses and to provide timely information 
to assist farmers with planting decisions. 
893. Sense of Senate regarding methyl bromide edtemative research and ex-
tension activities. 
Subtitle E—^Research Authority After Fiscal Year 1997 
897. Authorization of appropriations. 
898. Activities subject to availability of appropriations. 
TITLE IX—MISCELLANEOUS 
Subtitle A—Commercial Transportation of Equine for Slaughter 
901. Findings. 
902. Definitions. 
903. Regulation of commercial transportation of equine for slaughter. 
904. Limitation of authority to equine for slaughter. 
905. Effective date. 
Subtitle B—General Provisions 
911. Interstate quarantine. 
912. Cotton classification services. 
913. Plant variety protection for certain tuber propagated plant varieties. 
914. Swine health protection. 
915. Designation of Mount Pleasant National Scenic Area. 
916. Pseuoorabies eradication program. 
917. Collection and use of agricultural quarantine and inspection fees. 
Meat and poultry inspection. 
Reimbursable agreements. 
920. Overseas tort claims. 
921. Operation 
of Graduate 
School of 
Department 
nonappropriated fiind instrumentality. 
Student internship programs. 
Conveyance of excess Federal personal property. 
Conveyance of land to White Oak Cemetery. 
925. Sale of land by the University of Arkansas. 
926. Designation of Dale Bumpers Small Farms Research Center. 
927. Department of Agriculture Washington Area Strategic Space Plan. 
928. Severability. 
918 
919 
922 
923 
924 
of Agriculture 
as 
Agricultural 
Market 
Transition Act. 
Contracts. 
Loans. 
TITLE I—AGRICULTURAL MARKET 
TRANSITION ACT 
Subtitle A—Short Title, Purpose, and 
Definitions 
7 u s e 7201. 
SEC. 101. SHORT TITLE AND PURPOSE. 
(a) SHORT TITLE.—^This title may be cited as the "Agricultural 
Market Transition Act". 
(b) PURPOSE.—It is the purpose of this title— 
(1) to authorize the use of binding production flexibility 
contracts between the United States and agricultural producers 
to support farming certainty and flexibility while ensuring 
continued compliance with farm conservation and wetland 
protection requirements; 
(2) to make nonrecourse marketing assistance loans and 
loan deficiency payments available for certain crops; 
(3) to improve the operation of farm programs for milk, 
peanuts, and sugar; and 
(4) to establish a commission to undertake a comprehensive 
review of past and future production agriculture in the United 
States. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 897 
SEC. 102. DEFINITIONS. 
7 USC 7202. 
In this title: 
(1) AGRICULTURAL ACT OF 1949.—Except in section 171, 
the term "Agricultural Act of 1949" means the Agricultural 
Act of 1949 (7 U.S.C. 1421 et seq.), as in effect prior to the 
suspensions under section 171(b)(1). 
(2) CONSIDERED PLANTED.—The term "considered planted" 
means acreage that is considered planted under title V of 
the Agricultural Act of 1949 (7 U.S.C. 1461 et seq.) and such 
other acreage as the Secretary considers fair and equitable. 
(3) CONTRACT.—The terms "contract" and "production flexi-
bility contract" mean a production flexibility contract entered 
into under section 111. 
(4) CONTRACT ACREAGE.—^The term "contract acreage" 
means 1 or more crop acreage bases established for contract 
commodities under title V of the Agricultural Act of 1949 (7 
U.S.C. 1461 et seq.) that would have been in effect for the 
1996 crop (but for suspension under section 171(b)(1)). 
(5) CONTRACT COMMODITY.—The term "contract commodity" 
means wheat, corn, grain sorghum, barley, oats, upland cotton, 
and rice. 
(6) CONTRACT PAYMENT.—^The term "contract payment" 
means a pajonent made under this subtitle pursuant to a 
contract. 
(7) DEPARTMENT.—The term "Department" means the 
Department of Agriculture. 
(8) EXTRA LONG STAPLE COTTON.—The term "extra long 
staple cotton" means cotton that— 
(A) is produced from pure strain varieties of the 
Barbadense species or any hybrid thereof, or other similar 
types of extra long staple cotton, designated by the Sec-
retary, having characteristics needed for various end uses 
for which United States upland cotton is not suitable and 
grown in irrigated cotton-growing regions of the United 
States designated by the Secretary or other areas des-
ignated by the Secretary as suitable for the production 
of the varieties or types; and 
(B) is ginned on a roller-type gin or, if authorized 
by the Secretary, ginned on another type gin for experi-
mental purposes. 
(9) FARM P
R
O
G
i
L
f
^
u
v
f PAYMENT YIELD.—The term "farm pro-
gram pa3anent yield" means the farm program payment yield 
established for the 1995 crop of a contract commodity under 
section 505 of the Agricultural Act of 1949 (7 U.S.C. 1465). 
The Secretary shall adjust the farm program payment yield 
for the 1995 crop of a contract commodity to account for any 
additional yield payments made with respect to that crop under 
subsection (b)(2) of the section. 
(10) LOAN COMMODITY.—The term "loan commodity" means 
each contract commodity, extra long staple cotton, and oilseed. 
(11) OILSEED.—^ll'he term "oilseed" means a crop of soy-
beans, sunflower seed, rapeseed, canola, safflower, flaxseed, 
mustard seed, or, if designated by the Secretary, other oilseeds. 
(12) PRODUCER.—The term "producer" means an owner, 
operator, landlord, tenant, or sharecropper who shares in the 
risk of producing a crop and who is entitled to share in the 
crop available for marketing from the farm, or would have 
110 STAT. 898 
PUBLIC LAW 104-127—APR. 4, 1996 
shared had the crop been produced. In determining whether 
a grower of hybrid seed is a producer, the Secretary shall 
not take into consideration the existence of a hybrid seed con-
tract. 
(13) SECRETARY.—^The term "Secretary" means the Sec-
retary of Agriculture. 
(14) STATE.—^The term "State" means each of the several 
States of the United States, the District of Columbia, the 
Commonwealth of Puerto Rico, and any other territory or 
possession of the United States. 
(15) UNITED STATES.—The term "United States", when used 
in a geographical sense, means all of the States. 
Subtitle B—Production Flexibility 
Contracts 
7 use 7211. 
SEC. 111. AUTHORIZATION FOR USE OF PRODUCTION FLEXIBILITY 
CONTRACTS. 
(a) OFFER AND TERMS.—^The Secretary shall offer to enter into 
a production flexibility contract with an eligible owner or producer 
described in subsection (b) on a farm containing eligible cropland. 
Under the terms of a contract, the owner or producer shall agree, 
in exchange for annual contract pa3rments, to— 
(1) 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.); 
(2) comply with applicable wetland protection requirements 
under subtitle C of title XII of the Act (16 U.S.C. 3821 et 
seq.); 
(3) comply with the planting flexibility requirements of 
section 118; and 
(4) use the land subject to the contract for an agricultural 
or related activity, but not for a nonagricultural commercial 
or industrial use, as determined by the Secretary. 
(b) ELIGIBLE OWNERS AND PRODUCERS DESCRIBED.—^The follow-
ing producers and owners shall be eligible to enter into a contract: 
(1) An owner of eligible cropland who assumes all or a 
part of the risk of producing a crop. 
(2) A producer (other than an owner) on eligible cropland 
with a share-rent lease of the eligible cropland, regardless 
of the length of the lease, if the owner enters into the same 
contract. 
(3) A producer (other than an owner) on eligible cropland 
who cash rents the eligible cropland under a lease expiring 
on or after September 30, 2002, in which case the owner is 
not required to enter into the contract. 
(4) A producer (other than an owner) on eligible cropland 
who cash rents the eligible cropland under a lease expiring 
before September 30, 2002. The owner of the eligible cropland 
may also enter into the same contract. If the producer elects 
to enroll less than 100 percent of the eligible cropland in 
the contract, the consent of the owner is required. 
(5) An owner of eligible cropland who cash rents the eligible 
cropland and the lease term expires before September 30, 2002, 
if the tenant declines to enter into a contract. In the case 
of an owner covered by this paragraph, contract payments 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 899 
shall not begin under a contract until the lease held by the 
tenant ends. 
(6) An owner or producer described in any preceding para-
graph regardless of whether the owner or producer purchased 
catastrophic risk protection for a 1996 crop under section 508(b) 
of the Federal Crop Insurance Act (7 U.S.C. 1508(b)). 
(c) TENANTS AND SHARECROPPERS.—In carrying out this sub-
title, the Secretary shall provide adequate safeguards to protect 
the interests of tenants and sharecroppers. 
(d) ELIGIBLE CROPLAND DESCRIBED.—Land shall be considered 
to be cropland eligible for coverage under a contract only if the 
land has contract acreage attributable to the land and— 
(1) for at least 1 of the 1991 through 1995 crops, at least 
a portion of the land was enrolled in the acreage reduction 
program authorized for a crop of a contract commodity under 
section lOlB, 103B, 105B, or 107B of the Agricultural Act 
of 1949 or was considered planted; 
(2) was subject to a conservation reserve contract under 
section 1231 of the Food Security Act of 1985 (16 U.S.C. 3831) 
whose term expired, or was voluntarily terminated, on or after 
January 1, 1995; or 
(3) is released from coverage under a conservation reserve 
contract by the Secretary during the period beginning on Janu-
ary 1, 1995, and ending on the date specified in section 
112(a)(2). 
(e) QUANTITY OF ELIGIBLE CROPLAND COVERED BY CONTRACT.— 
Subject to subsection (b)(4), an owner or producer may enroll as 
contract acreage all or a portion of the eligible cropland on the 
farm. 
(f) VOLUNTARY REDUCTION IN CONTRACT ACREAGE.—Subject to 
subsection (b)(4), an owner or producer who enters into a contract 
may subsequently reduce the quantity of contract acreage covered 
by the contract. 
SEC. 112. ELEMENTS OF CONTRACTS. 
7 USC 7212. 
(a) TIME FOR CONTRACTING.— 
(1) COMMENCEMENT.—To the extent practicable, the Sec-
retary shall commence entering into contracts not later than 
45 days after the date of enactment of this title. 
(2) DEADLINE.—Except as provided in paragraph (3), the 
Secretary may not enter into a contract after August 1, 1996. 
(3) CONSERVATION RESERVE LANDS.— 
(A) IN GENERAL.—^At the beginning of each fiscal year, 
the Secretary shall allow an eligible owner or producer 
on a farm covered by a conservation reserve contract 
entered into under section 1231 of the Food Security Act 
of 1985 (16 U.S.C. 3831) that terminates after the date 
specified in paragraph (2) to enter into or expand a produc-
tion flexibility contract to cover the contract acreage of 
the farm that was subject to the former conservation 
reserve contract. 
(B) AMOUNT.—Contract payments made for contract 
acreage under this paragraph shall be made at the rate 
and amount applicable to the annual contract payment 
level for the applicable crop. For the fiscal year in which 
the conservation reserve contract is terminated, the owner 
or producer subject to the production flexibility contract 
110 STAT. 900 
PUBLIC LAW 104-127—APR. 4, 1996 
may elect to receive either contract payments or a prorated 
pa3ntnent under the conservation reserve contract, but not 
both. 
(b) DURATION OF CONTRACT.— 
(1) BEGINNING DATE.—The term of a contract shall begin 
with— 
(A) the 1996 crop of a contract commodity; or 
(B) in the case of acreage that was subject to a con-
servation reserve contract described in subsection (a)(3), 
the date the production flexibility contract was entered 
into or expanded to cover the acreage. 
(2) ENDING DATE.—The term of a contract shall extend 
through the 2002 crop, unless earlier terminated by the owner 
or producer. 
(c) ESTIMATION OF CONTRACT PAYMENTS.—^At the time the Sec-
retary enters into a contract, the Secretary shall provide an estimate 
of the minimum contract payments anticipated to be made during 
at least the first fiscal year for which contract payments will be 
made. 
(d) TIME FOR PAYMENT.— 
(1) IN GENERAL.—^An annual contract payment shall be 
made not later than September 30 of each of fiscal years 1996 
through 2002. 
(2) ADVANCE PAYMENTS.— 
(A) FISCAL YEAR 1996.—^At the option of the owner 
or producer, 50 percent of the contract payment for fiscal 
year 1996 shall be made not later than 30 days after 
the date on which the contract is entered into and approved 
by the Secretary and the owner or producer. 
(B) SUBSEQUENT FISCAL YEARS.—^At the option of the 
owner or producer for fiscal year 1997 and each subsequent 
fiscal year, 50 percent of the annual contract payment 
shall be made on December 15 or January 15 of the fiscal 
year. The owner or producer may change the date selected 
under this subparagraph for a subsequent fiscal year by 
providing advance notice to the Secretary. 
7 use 7213. 
SEC. 113. AMOUNTS AVAILABLE FOR CONTRACT PAYMENTS. 
(a) FISCAL YEAR AMOUNTS.—The Secretary shall, to the maxi-
mum extent practicable, expend the following amounts to satisfy 
the obligations of the Secretary under all contracts: 
(1) For fiscal year 1996, $5,570,000,000. 
(2) For fiscal year 1997, $5,385,000,000. 
(3) For fiscal year 1998, $5,800,000,000. 
(4) For fiscal year 1999, $5,603,000,000. 
(5) For fiscal year 2000, $5,130,000,000. 
(6) For fiscal year 2001, $4,130,000,000. 
(7) For fiscal year 2002, $4,008,000,000. 
(b) ALLOCATION.—The amount made available for a fiscal year 
under subsection (a) shall be allocated as follows: 
(1) For wheat, 26.26 percent. 
(2) For corn, 46.22 percent. 
(3) For grain sorghum, 5.11 percent. 
(4) For barley, 2.16 percent. 
(5) For oats, 0.15 percent. 
(6) For upland cotton, 11.63 percent. 
(7) For rice, 8.47 percent. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 901 
(c) ADJUSTMENT.—The Secretary shall adjust the amounts allo-
cated for each contract commodity under subsection (b) for a particu-
lar fiscal year by— 
(1) adding an amount equal to the sum of all repayments 
of deficiency payments required under section 114(a)(2) of the 
Agricultural Act of 1949 (7 U.S.C. 1445j(a)(2)) for the commod-
ity; 
(2) adding an amount equal to the sum of all refunds 
of contract payments received during the preceding fiscal year 
under section 116 for the commodity; and 
(3) subtracting an amount equal to the amount, if any, 
necessary during that fiscal year to satisfy payment require-
ments for the commodity under sections 103B, 105B, or 107B 
of the Agricultural Act of 1949 for the 1994 and 1995 crop 
years. 
(d) ADDITIONAL RICE ALLOCATION.—In addition to the adjust-
ments required under subsection (c), the amount allocated under 
subsection (b) for rice contract payments shall be increased by 
$8,500,000 for each of fiscal years 1997 through 2002. 
(e) EXCLUSION OF CERTAIN AMOUNTS FROM CONTRACT PAY-
MENTS.—^Any amount added pursuant to paragraphs (1) and (2) 
of subsection (c) to the amount available under subsection (a) for 
a fiscal year and paid to owners and producers under a contract 
shall not be treated as a contract payment for purposes of section 
115(a) of this title or section 1001(1) of the Food Security Act 
of 1985 (7 U.S.C. 1308(1)). However, the amount of a payment 
covered by this subsection may not exceed $50,000 per person. 
(f) EFFECT OF PAYMENT LIMITATION.—^The amount available 
under subsection (a) for a fiscal year shall be reduced by an amount 
equal to the total amount of contract payments for the fiscal year 
that owners and producers forgo as a result of operation of the 
payment limitation under section 1001(1) of the Food Security Act 
of 1985 (7 U.S.C. 1308(1)). 
SEC. 114. DETERMINATION OF CONTRACT PAYMENTS UNDER CON- 
7 USC 7214. 
TRACTS. 
(a) INDIVIDUAL PAYMENT QUANTITY OF CONTRACT COMMOD-
ITIES.—For each contract, the payment quantity of a contract 
commodity for each fiscal year shall be equal to the product of— 
(1) 85 percent of the contract acreage; and 
(2) the farm program payment yield. 
(b) ANNUAL PAYMENT QUANTITY OF CONTRACT COMMODITIES.— 
The payment quantity of each contract commodity covered by all 
contracts for each fiscal year shall be equal to the sum of the 
amounts calculated under subsection (a) for each individual con-
tract. 
(c) ANNUAL PAYMENT RATE.—^The payment rate for a contract 
commodity for each fiscal year shall be equal to— 
(1) the amount made available under section 113 for the 
contract commodity for the fiscal year; divided by 
(2) the amount determined under subsection (b) for the 
fiscal year. 
(d) ANNUAL PAYMENT AMOUNT.—The amount to be paid under 
a contract in effect for each fiscal year with respect to all contract 
commodities covered by the contract shall be equal to the sum 
of the products of— 
110 STAT. 902 
PUBLIC LAW 104-127—APR. 4, 1996 
(1) the payment quantity determined under subsection (a) 
for each of the contract commodities covered by the contract; 
and 
(2) the corresponding payment rate for the contract 
commodity in effect under subsection (c). 
(e) REDUCTION IN PAYMENT AMOUNT.—The contract payment 
determined under subsection (d) for an owner or producer for a 
fiscal year shall be immediately reduced by the amount of any 
repayment of deficiency payments that is required under section 
114(a)(2) of the Agricultural Act of 1949 (7 U.S.C. 1445j(a)(2)) 
and is not repaid as of the date the contract payment is determined. 
The Secretary shall be required to collect the required repayment, 
or any claim based on the required repayment, as soon as the 
contract payment is determined. 
(f) ASSIGNMENT OF CONTRACT PAYMENTS.—The provisions of 
section 8(g) of the Soil Conservation and Domestic Allotment Act 
(16 U.S.C. 590h(g)) (relating to assignment of payments) shall apply 
to contract payments under this section. The owner or producer 
making the assignment, or the assignee, shall provide the Secretary 
with notice, in such manner as the Secretary may require in the 
contract, of any assignment made under this subsection. 
(g) SHARING OF CONTRACT PAYMENTS.—^The Secretary shall pro-
vide for the sharing of contract payments among the owners and 
producers subject to the contract on a fair and equitable basis. 
7 use 7215. 
SEC. 115. PAYMENT LIMITATIONS. 
(a) APPLICABILITY OF PAYMENT LIMITATIONS.—Sections 
1001 
through lOOlC of the Food Security Act of 1985 (7 U.S.C. 1308 
through 1308-3), as amended by this section, shall be applicable 
to contract payments made under this subtitle. 
(b) PAYMENT LIMITATIONS.—Section 1001 of the Food Security 
Act of 1985 (7 U.S.C. 1308) is amended by striking paragraphs 
(1) through (4) and inserting the following: 
"(1) LIMITATION ON PAYMENTS UNDER PRODUCTION FLEXIBIL-
ITY CONTRACTS.—^The total amount of contract payments made 
under the Agricultural Market Transition Act to a person under 
1 or more production flexibility contracts during any fiscal 
year may not exceed $40,000. 
"(2) LIMITATION ON MARKETING LOAN GAINS AND LOAN DEFI-
CIENCY PAYMENTS.—^The total amount of the payments specified 
in paragraph (3) that a person shall be entitled to receive 
under the Agricultural Market Transition Act for 1 or more 
contract commodities and oilseeds during any crop year may 
not exceed $75,000. 
"(3) DESCRIPTION OF PAYMENTS SUBJECT TO LIMITATION.— 
The payments referred to in paragraph (2) are the following: 
"(A) Any gain realized by a producer from repaying 
a marketing assistance loan under section 131 of the Agri-
cultural Market Transition Act for a crop of any loan 
commodity at a lower level than the original loan rate 
established for the loan commodity under section 132 of 
the Act. 
"(B) Any loan deficiency pa3anent received for a loan 
commodity under section 135 of the Act. 
"(4) 
DEFINITIONS.—In this title, the terms 
'contract 
commodity', 'contract payment', 'loan commodity', 'oilseed', and 
'production flexibility contract' have the meaning given those 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 903 
terms in section 102 of the Agricultural Market Transition 
Act.". 
(c) CONFORMING AMENDMENTS.— 
(1) Section 100L^ of the Food Security Act of 1985 (7 
U.S.C. 1308-1) is amended— 
(A) in subsection (a)(1), by striking "under the Agricul-
tural Act of 1949 (7 U.S.C. 1421 et seq.)"; and 
(B) in subsection (b)( 1), by striking "under the Agricul-
tural Act of 1949" 
(2) Section lOOlC(a) of the Act (7 U.S.C. 1308-3(a)) is 
amended— 
(A) by striking "For each of the 1991 through 1997 
crops, any" and inserting "Any"; 
(B) by striking "production adjustment payments, price 
support program loans, payments, or benefits made avail-
able under the Agricultural Act of 1949 (7 U.S.C. 1421 
et seq.)," and inserting "loans or payments made available 
under the Agricultural Market Transition Act,"; and 
(C) by striking "during the 1989 through 1997 crop 
years". 
SEC. 116. VIOLATIONS OF CONTRACT. 
7 USC 7216. 
(a) TERMINATION OF CONTRACT FOR VIOLATION.—Except as pro-
vided in subsection (b), if an owner or producer subject to a contract 
violates a requirement of the contract specified in section 111(a), 
the Secretary shall terminate the contract with respect to the 
owner or producer on each farm in which the owner or producer 
has an interest. On the termination, the owner or producer shall 
forfeit all rights to receive future contract payments on each farm 
in which the owner or producer has an interest and shall refund 
to the Secretary all contract payments received by the owner or 
producer during the period of the violation, together with interest 
on the contract payments as determined by the Secretary. 
(b) REFUND OR ADJUSTMENT.—If the Secretary determines that 
a violation does not warrant termination of the contract under 
subsection (a), the Secretary may require the owner or producer 
subject to the contract— 
(1) to refund to the Secretary that part of the contract 
payments received by the owner or producer during the period 
of the violation, together with interest on the contract payments 
as determined by the Secretary; or 
(2) to accept a reduction in the amount of future contract 
payments that is proportionate to the severity of the violation, 
as determined by the Secretary. 
(c) FORECLOSURE.— 
(1) EFFECT OF FORECLOSURE.—^An owner or producer sub-
ject to a contract may not be required to make repayments 
to the Secretary of amounts received under the contract if 
the contract acreage has been foreclosed on and the Secretary 
determines that for^jiving the repayments is appropriate to 
provide fair and equitable treatment. 
(2) RESUMPTION OF OPERATION.—This subsection shall not 
void the responsibilities of the owner or producer under the 
contract if the owner or producer continues or resumes oper-
ation, or control, of the contract acreage. On the resumption 
of operation or control over the contract acreage by the owner 
110 STAT. 904 
PUBLIC LAW 104-127—APR. 4, 1996 
or producer, the provisions of the contract in effect on the 
date of the foreclosure shall apply. 
(d) REVIEW.—^A determination of the Secretary under this sec-
tion shall be considered to be an adverse decision for purposes 
of the availability of administrative review of the determination. 
7 use 7217. 
SEC. 117. TRANSFER OR CHANGE OF INTEREST IN LANDS SUBJECT 
TO CONTRACT. 
(a) TERMINATION.—Except as provided in subsection (c), a trans-
fer of (or change in) the interest of an owner or producer subject 
to a contract in the contract acreage covered by the contract shall 
result in the termination of the contract with respect to the acreage, 
unless the transferee or owner of the acreage agrees to assume 
all obligations under the contract. The termination shall be effective 
on the date of the transfer or change. 
(b) MODIFICATION.—^At the request of the transferee or owner, 
the Secretary may modify the contract if the modifications are 
consistent with the objectives of this subtitle, as determined by 
the Secretary. 
(c) EXCEPTION.—If an owner or producer who is entitled to 
a contract payment dies, becomes incompetent, or is otherwise 
unable to receive the contract payment, the Secretary shall make 
the pa3n3ient, in accordance with regulations prescribed by the 
Secretary. 
7 use 7218. 
SEC. 118. PLANTING FLEXIBILITY. 
(a) PERMITTED CROPS.—Subject to subsection (b), any commod-
ity or crop may be planted on contract acreage on a farm. 
(b) 
LIMITATIONS AND EXCEPTIONS REGARDING 
FRUITS AND 
VEGETABLES.— 
(1) LIMITATIONS.—^The planting of fruits and vegetables 
(other than lentils, mung beans, and dry peas) shall be prohib-
ited on contract acreage. 
(2) EXCEPTIONS.—^Paragraph (1) shall not limit the planting 
of a fruit or vegetable— 
(A) in any region in which there is a history of double-
cropping of contract commodities with fruits or vegetables, 
as determined by the Secretary, in which case the double-
cropping shall be permitted; 
(B) on a farm that the Secretary determines has a 
history of planting fruits or vegetables on contract acreage, 
except that a contract payment shall be reduced by an 
acre for each acre planted to the fruit or vegetable; or 
(C) by a producer who the Secretary determines has 
an established planting history of a specific fruit or vegeta-
ble, except that— 
(i) the quantity planted may not exceed the produc-
er's average annual planting history of the fruit or 
vegetable in the 1991 through 1995 crop years (exclud-
ing any crop year in which no plantings were made), 
as determined by the Secretary; and 
(ii) a contract payment shall be reduced by an 
acre for each acre planted to the fruit or vegetable. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 905 
Subtitle C—Nonrecourse Marketing Assist-
ance Loans and Loan Deficiency Pay-
ments 
SEC. 131. AVAILABILITY OF NONRECOURSE MARKETING ASSISTANCE 
7 USC 7231. 
LOANS. 
(a) NONRECOURSE LOANS AVAILABLE.—For each of the 1996 
through 2002 crops of each loan commodity, the Secretary shall 
make available to prodiicers on a farm nonrecourse marketing 
assistance loans for loan commodities produced on the farm. The 
loans shall be made under terms and conditions that are prescribed 
by the Secretary and at the loan rate established under section 
132 for the loan commodity. 
(b) ELIGIBLE PRODUCTION.—^The following production shall be 
eligible for a marketing assistance loan under subsection (a): 
(1) In the case of a marketing assistance loan for a contract 
commodity, any production by a producer on a farm containing 
eligible cropland covered by a production flexibility contract. 
(2) In the case of a marketing assistance loan for extra 
long staple cotton and oilseeds, any production. 
(c) COMPLIANCE WITH CONSERVATION AND WETLANDS REQUIRE-
MENTS.—^AS a condition of the receipt of a marketing assistance 
loan under subsection (a)., the producer shall 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.) and applicable wetland 
protection requirements under subtitle C of title XII of the Act 
(16 U.S.C. 3821 et seq.) during the term of the loan. 
(d) ADDITIONAL OUTLAYS PROHIBITED.—The Secretary shall 
carry out this subtitle in such a manner that there are no additional 
outlays under this subtitle as a result of the reconstitution of 
a farm that occurs as a result of the combination of another farm 
that does not contain eligible cropland covered by a production 
flexibility contract. 
SEC. 132. LOAN RATES FOR MARKETING ASSISTANCE LOANS. 
7 USC 7232. 
(a) WHEAT.— 
(1) LOAN RATE.—Subject to paragraph (2), the loan rate 
for a marketing assistance loan under section 131 for wheat 
shall be— 
(A) not less than 85 percent of the simple average 
price received by producers of wheat, as determined by 
the Secretary, during the marketing years for the imme-
diately preceding 5 crops of wheat, excluding the year 
in which the average price was the highest and the year 
in which the average price was the lowest in the period; 
but 
(B) not more than $2.58 per bushel. 
(2) STOCKS TO USE RATIO ADJUSTMENT.—If the Secretary 
estimates for any marketing year that the ratio of ending 
stocks of wheat to total use for the marketing year will be— 
(A) equal to or greater than 30 percent, the Secretary 
may reduce the loan rate for wheat for the corresponding 
crop by an amount not to exceed 10 percent in any year; 
(B) less than 30 percent but not less than 15 percent, 
the Secretary may reduce the loan rate for wheat for the 
29-194 O - 96 - 30 : QL 3 Part 1 
110 STAT. 906 
PUBLIC LAW 104-127—APR. 4, 1996 
corresponding crop by an amount not to exceed 5 percent 
in any year; or 
(C) less than 15 percent, the Secretary may not reduce 
the loan rate for wheat for the corresponding crop. 
(b) FEED GRAINS.— 
(1) LOAN RATE FOR CORN.—Subject to paragraph (2), the 
loan rate for a marketing assistance loan under section 131 
for corn shall be— 
(A) not less than 85 percent of the simple average 
price received by producers of com, as determined by the 
Secretary, during the marketing years for the immediately 
preceding 5 crops of com, excluding the year in which 
the average price was the highest and the year in which 
the average price was the lowest in the period; but 
(B) not more than $1.89 per bushel. 
(2) STOCKS TO USE RATIO ADJUSTMENT.—If the Secretary 
estimates for any marketing year that the ratio of ending 
stocks of corn to total use for the marketing year will be— 
(A) equal to or greater than 25 percent, the Secretary 
may reduce the loan rate for corn for the corresponding 
crop by an amount not to exceed 10 percent in any year; 
(B) less than 25 percent but not less than 12.5 percent, 
the Secretary may reduce the loan rate for corn for the 
corresponding crop by an amount not to exceed 5 percent 
in any year; or 
(C) less than 12.5 percent, the Secretary may not 
reduce the loan rate for corn for the corresponding crop. 
(3) OTHER FEED GRAINS.—The loan rate for a marketing 
assistance loan under section 131 for grain sorghum, barley, 
and oats, respectively, shall be established at such level as 
the Secretary determines is fair and reasonable in relation 
to the rate that loans are made available for corn, taking 
into consideration the feeding value of the commodity in rela-
tion to corn. 
(c) UPLAND COTTON.— 
(1) LOAN RATE.—Subject to paragraph (2), the loan rate 
for a marketing assistance loan under section 131 for upland 
cotton shall be established by the Secretary at such loan rate, 
per pound, as will reflect for the base quality of upland cotton, 
as determined by the Secretary, at average locations in the 
United States a rate that is not less than the smaller o
f
— 
(A) 85 percent of the average price (weighted by market 
and month) of the base quality of cotton as quoted in 
the designated United States spot markets during 3 years 
of the 5-year period ending July 31 of the year preceding 
the year in which the crop is planted, excluding the year 
in which the average price was the highest and the year 
in which the average price was the lowest in the period; 
or 
(B) 90 percent of the average, for the 15-week period 
beginning July 1 of the year preceding the year in which 
the crop is planted, of the 5 lowest-priced growths of the 
growths quoted for Middling 1%2-inch cotton C.I.F. North-
ern Europe (adjusted downward by the average difference 
during the period April 15 through October 15 of the year 
preceding the year in which the crop is planted between 
the average Northern European price quotation of such 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 907 
quality of cotton and the market quotations in the des-
ignated United States spot markets for the base quaUty 
of upland cotton), as determined by the Secretary. 
(2) LIMITATIONS.—^The loan rate for a marketing assistance 
loan for upland cotton shall not be less than $0.50 per pound 
or more than $0.5192 per pound. 
(d) EXTRA LONG STAPLE COTTON.—The loan rate for a market-
ing assistance loan under section 131 for extra long staple cotton 
shall be— 
(1) not less than 85 percent of the simple average price 
received by producers of extra long staple cotton, as determined 
by the Secretary, during 3 years of the 5-year period ending 
July 31 of the year preceding the year in which the crop 
is planted, excluding the year in which the average price was 
the highest and the year in which the average price was the 
lowest in the period; but 
(2) not more than $0.7965 per pound. 
(e) RICE.—^The loan rate for a marketing assistance loan under 
section 131 for rice shall be $6.50 per hundredweight. 
(f) OILSEEDS.— 
(1) SOYBEANS.—^The loan rate for a marketing assistance 
loan under section 131 for soybeans shall be— 
(A) not less than 85 percent of the simple average 
price received by producers of soybeans, as determined 
by the Secretary, during the marketing years for the imme-
diately preceding 5 crops of soybeans, excluding the year 
in which the average price was the highest and the year 
in which the average price was the lowest in the period; 
but 
(B) not less than $4.92 or more than $5.26 per bushel. 
(2) SUNFLOWER SEED, CANOLA, RAPESEED, SAFFLOWER, MUS-
TARD SEED, AND FLAXSEED.—^The loan rate for a marketing 
assistance loan under section 131 for sunflower seed, canola, 
rapeseed, safflower, mustard seed, and flaxseed, individually, 
shall be— 
(A) not less than 85 percent of the simple average 
price received by producers of sunflower seed, individually, 
as determined by the Secretary, during the marketing years 
for the immediately preceding 5 crops of sunflower seed, 
individually, excluding the year in which the average price 
was the highest and the year in which the average price 
was the lowest in the period; but 
(B) not less than $0,087 or more than $0,093 per 
pound. 
(3) OTHER OILSEEDS.—The loan rates for a marketing 
assistance loan under section 131 for other oilseeds shall be 
established at such level as the Secretary determines is fair 
and reasonable in relation to the loan rate available for soy-
beans, except in no event shall the rate for the oilseeds (other 
than cottonseed) be less than the rate established for soyjbeans 
on a per-pound basis for the same crop. 
SEC. 133. TERM OF LOANS. 
7 USC 7233. 
(a) TERM OF LOAN.—In the case of each loan commodity (other 
than upland cotton or extra long staple cotton), a marketing assist-
ance loan under section 131 shall have a term of 9 months beginning 
110 STAT. 908 
PUBLIC LAW 104-127—APR. 4, 1996 
on the first day of the first month after the month in which 
the loan is made. 
(b) SPECIAL RULE FOR COTTON.—^A marketing assistance loan 
for upland cotton or extra long staple cotton shall have a term 
of 10 months beginning on the first day of the month in which 
the loan is made. 
(c) EXTENSIONS PROHIBITED.—The Secretary may not extend 
the term of a marketing assistance loan for any loan commodity. 
7 use 7234. 
SEC. 134. REPAYMENT OF LOANS. 
(a) REPAYMENT RATES FOR WHEAT, FEED GRAINS, AND OIL-
SEEDS.—^The Secretary shall permit a producer to repay a marketing 
assistance loan under section 131 for wheat, com, grain sorghum, 
barley, oats, and oilseeds at a rate that is the lesser of— 
(1) the loan rate established for the commodity under sec-
tion 132, plus interest (as determined by the Secretary); or 
(2) a rate that the Secretary determines will— 
(A) minimize potential loan forfeitures; 
(B) minimize the accumulation of stocks of the commod-
ity by the Federal Government; 
(C) minimize the cost incurred by the Federal Govern-
ment in storing the commodity; and 
(D) allow the commodity produced in the United States 
to be marketed freely and competitively, both domestically 
and internationally. 
(b) REPAYMENT RATES FOR UPLAND COTTON AND RICE.—The 
Secretary shall permit producers to repay a marketing assistance 
loan under section 131 for upland cotton and rice at a rate that 
is the lesser of— 
(1) the loan rate established for the commodity under sec-
tion 132, plus interest (as determined by the Secretary); or 
(2) the prevailing world market price for the commodity 
(adjusted to United States quality and location), as determined 
by the Secretary. 
(c) REPAYMENT RATES FOR EXTRA LONG STAPLE COTTON.— 
Repayment of a marketing assistance loan for extra long staple 
cotton shall be at the loan rate established for the commodity 
under section 132, plus interest (as determined by the Secretary). 
Regulations. 
(d) PREVAILING WORLD MARKET PRICE.—For purposes of this 
section and section 136, the Secretary shall prescribe by regula-
tion— 
(1) a formula to determine the prevailing world market 
price for each loan commodity, adjusted to United States quality 
and location; and 
(2) a mechanism by which the Secretary shall announce 
periodically the prevailing world market price for each loan 
commodity. 
(e) ADJUSTMENT OF PREVAILING WORLD MARKET PRICE FOR 
UPLAND COTTON.— 
(1) IN GENERAL.—During the period ending July 31, 2003, 
the prevailing world market price for upland cotton (adjusted 
to United States quality and location) established under sub-
section (d) shall be further adjusted if— 
(A) the adjusted prevailing world market price is less 
than 115 percent of the loan rate for upland cotton estab-
lished under section 132, as determined by the Secretary; 
and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 909 
(B) the Friday through Thursday 
average 
price 
quotation for the lowest-priced United States growth as 
quoted for Middling (M) 1%2-inch cotton delivered C.I.F. 
Northern Europe is greater than the Friday through Thurs-
day average price of the 5 lowest-priced growths of upland 
cotton, as quoted for Middling (M) 1%2-inch cotton, deliv-
ered C.LF. Northern Europe (referred to in this section 
as the "Northern Europe price"). 
(2) FURTHER ADJUSTMENT.—Except as provided in para-
graph (3), the adjusted prevailing world market price for upland 
cotton shall be further adjusted on the basis of some or all 
of the following data, as available: 
(A) The United States share of world exports. 
(B) The current level of cotton export sales and cotton 
export shipments. 
(C) Other data determined by the Secretary to be rel-
evant in establishing an accurate prevailing world market 
price for upland cotton (adjusted to United States quality 
and location). 
(3) LIMITATION ON FURTHER ADJUSTMENT.—The adjustment 
under paragraph (2) may not exceed the difference between— 
(A) the Friday through Thursday average price for 
the lowest-priced United States growth as quoted for Mid-
dling 1%2-inch cotton delivered C.I.F. Northern Europe; 
and 
(B) the Northern Europe price. 
SEC. 135. LOAN DEFICIENCY PAYMENTS. 
7 USC 7235. 
(a) AVAILABILITY OF LOAN DEFICIENCY PAYMENTS.—Except as 
provided in subsection (d), the Secretary may make loan deficiency 
payments available to producers who, although eligible to obtain 
a marketing assistance loan under section 131 with respect to 
a loan commodity, agree to forgo obtaining the loan for the commod-
ity in return for payments under this section. 
(b) COMPUTATION.—^A loan deficiency payment under this sec-
tion shall be computed by multiplying— 
(1) the loan payment rate determined under subsection 
(c) for the loan commodity; by 
(2) the quantity of the loan commodity that the producers 
on a farm are eligible to place under loan but for which the 
producers forgo obtaining the loan in return for payments under 
this section. 
(c) LOAN PAYMENT RATE.—For purposes of this section, the 
loan payment rate shall be the amount by which— 
(1) the loan rate established under section 132 for the 
loan commodity; exceeds 
(2) the rate at which a loan for the commodity may be 
repaid under section 134. 
(d) EXCEPTION FOR EXTRA LONG STAPLE COTTON.—This section 
shall not apply with respect to extra long staple cotton. 
SEC. 136. SPECIAL MARKETING LOAN PROVISIONS FOR UPLAND COT- 
7 USC 7236. 
TON. 
(a) COTTON USER MARKETING CERTIFICATES.— 
(1) ISSUANCE.—Subject to paragraph (4), during the period 
ending July 31, 2003, the Secretary shall issue marketing cer-
tificates or cash payments to domestic users and exporters 
for documented purchases by domestic users and sales for 
110 STAT. 910 
PUBLIC LAW 104-127—APR. 4, 1996 
export by exporters made in the week following a consecutive 
4-week period in which— 
(A) the Friday through Thursday average 
price 
quotation for the lowest-priced United States growth, as 
quoted for Middling (M) 1%2-inch cotton, delivered C.LF. 
Northern Europe exceeds the Northern Europe price by 
more than 1.25 cents per pound; and 
(B) the prevailing world market price for upland cotton 
(adjusted to United States quality and location) does not 
exceed 130 percent of the loan rate for upland cotton estab-
lished under section 132. 
(2) VALUE OF CERTIFICATES OR PAYMENTS.—^The value of 
the marketing certificates or cash payments shall be based 
on the amount of the difference (reduced by 1.25 cents per 
pound) in the prices during the 4th week of the consecutive 
4-week period multiplied by the quantity of upland cotton 
included in the documented sales. 
(3) ADMINISTRATION OF MARKETING CERTIFICATES.— 
(A) REDEMPTION, MARKETING, OR EXCHANGE.—The Sec-
retary shall establish procedures for redeeming marketing 
certificates for cash or marketing or exchange of the certifi-
cates for agricultural commodities owned by the Commodity 
Credit Corporation in such manner, and at such price 
levels, as the Secretary determines will best effectuate 
the purposes of cotton user marketing certificates. Any 
price restrictions that would otherwise apply to the disposi-
tion of agricultural commodities by the Commodity Credit 
Corporation shall not apply to the redemption of certificates 
under this subsection. 
(B) DESIGNATION OF COMMODITIES AND PRODUCTS.— 
To the extent practicable, the Secretary shall permit owners 
of certificates to designate the commodities and products, 
including storage sites, the owners would prefer to receive 
in exchange for certificates. If any certificate is not pre-
sented for redemption, marketing, or exchange within a 
reasonable number of days after the issuance of the certifi-
cate (as determined by the Secretary), reasonable costs 
of storage and other carrying charges, as determined by 
the Secretary, shall be deducted from the value of the 
certificate for the period beginning after the reasonable 
number of days and ending with the date of the presen-
tation of the certificate to the Commodity Credit Corpora-
tion. 
(C) 
TRANSFERS.—Marketing certificates 
issued 
to 
domestic users and exporters of upland cotton may be 
transferred to other persons in accordance with regulations 
issued by the Secretary. 
(4) EXCEPTION.—The Secretary shall not issue marketing 
certificates or cash payments under paragraph (1) if, for the 
immediately preceding consecutive 10-week period, the Friday 
through Thursday average price quotation for the lowest priced 
United States growth, as quoted for Middling (M) 1%2-inch 
cotton, delivered C.I.F. Northern Europe, adjusted for the value 
of any certificate issued under this subsection, exceeds the 
Northern Europe price by more than 1.25 cents per pound. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 911 
(5) LIMITATION ON EXPENDITURES.—^Total 
expenditures 
under this subsection shall not exceed $701,000,000 during 
fiscal years 1996 through 2002. 
(b) SPECIAL IMPORT QUOTA.— 
(1) ESTABLISHMENT.—The President shall carry out an President, 
import quota program that provides that, during the period 
ending July 31, 2003, whenever the Secretary determines and 
announces that for any consecutive 10-week period, the Friday 
through Thursday average price quotation for the lowest-priced 
United States growth, as quoted for Middling (M) 1%2-inch 
cotton, delivered C.I.F. Northern Europe, adjusted for the value 
of any certificates issued under subsection (a), exceeds the 
Northern Europe price by more than 1.25 cents per pound, 
there shall immediately be in effect a special import quota. 
(2) QUANTITY.—The quota shall be equal to 1 week's 
consumption of upland cotton by domestic mills at the season-
ally adjusted average rate of the most recent 3 months for 
which data are available. 
(3) APPLICATION.—The quota shall apply to upland cotton 
purchased not later than 90 days after the date of the Sec-
retary's announcement under paragraph (1) and entered into 
the United States not later than 180 days after the date. 
(4) OVERLAP.—^A special quota period may be established 
that overlaps any existing quota period if required by paragraph 
(1), except that a special quota period may not be established 
under this subsection if a quota period has been established ^ 
under subsection (c). 
(5) PREFERENTIAI. TARIFF TREATMENT.—^The quantity under 
a special import quota shall be considered to be an in-quota 
quantity for purposes of— 
(A) section 213(d) of the Caribbean Basin Economic 
Recovery Act (19 U.S.C. 2703(d)); 
(B) section 204 of the Andean Trade Preference Act 
(19 U.S.C. 3203); 
(C) section 503(d) of the Trade Act of 1974 (19 U.S.C. 
2463(d)); and 
(D) General Note 3(a)(iv) to the Harmonized Tariff 
Schedule. 
(6) DEFINITION.—In this subsection, the term "special 
import quota" means a quantity of imports that is not subject 
to the over-quota tariff rate of a tariff-rate quota. 
(c) LIMITED GLOBAL IMPORT QUOTA FOR UPLAND COTTON.— 
(1) IN GENERAL.—The President shall carry out an import President, 
quota program that provides that whenever the Secretary deter-
mines and announces that the average price of the base quality 
of upland cotton, as determined by the Secretary, in the des-
ignated spot markets for a month exceeded 130 percent of 
the average price of such quality of cotton in the markets 
for the preceding 36 months, notwithstanding any other provi-
sion of law, there shall immediately be in effect a limited 
global import quota subject to the following conditions: 
(A) QUANTITY.—The quantity of the quota shall be 
equal to 21 days of domestic mill consumption of upland 
cotton at the seasonally adjusted average rate of the most 
recent 3 months for which data are available. 
(B) QUANTH^ IF PRIOR QUOTA.—If a quota has been 
established under this subsection during the preceding 12 
110 STAT. 912 
PUBLIC LAW 104-127—APR. 4, 1996 
months, the quantity of the quota next estabHshed under 
this subsection shall be the smaller of 21 days of domestic 
mill consumption calculated under subparagraph (A) or 
the quantity required to increase the supply to 130 percent 
of the demand. 
(C) PREFERENTIAL TARIFF TREATMENT.—The quantity 
under a limited global import quota shall be considered 
to be an in-quota quantity for purposes of— 
(i) section 213(d) of the Caribbean Basin Economic 
Recovery Act (19 U.S.C. 2703(d)); 
(ii) section 204 of the Andean Trade Preference 
Act (19 U.S.C. 3203); 
(iii) section 503(d) of the Trade Act of 1974 (19 
U.S.C. 2463(d)); and 
(iv) General Note 3(a)(iv) to the Harmonized Tariff 
Schedule. 
(D) DEFINITIONS.—In this subsection: 
(i) SUPPLY.—^The term "supply" means, using the 
latest official data of the Bureau of the Census, the 
Department of Agriculture, and the Department of the 
Treasury— 
(I) the carry-over of upland cotton at the begin-
ning of the marketing year (adjusted to 480-pound 
bales) in which the quota is established; 
(II) production of the current crop; and 
(III) imports to the latest date available during 
the marketing year. 
(ii) DEMAND.—The term "demand" means— 
(I) the average seasonally adjusted annual rate 
of domestic mill consumption during the most 
recent 3 months for which data are available; and 
(II) the larger of— 
(aa) average exports of upland cotton dur-
ing the preceding 6 marketing years; or 
(bb) cumulative exports of upland cotton 
plus outstanding export sales for the market-
ing year in which the quota is established, 
(iii) LIMITED GLOBAL IMPORT QUOTA.—The term 
"limited global import quota" means a quantity of 
imports that is not subject to the over-quota tariff 
rate of a tariff-rate quota. 
(E) QUOTA ENTRY PERIOD.—^When a quota is estab-
lished under this subsection, cotton may be entered under 
the quota during the 90-day period beginning on the date 
the quota is established by the Secretary. 
(2) No OVERLAP.—Notwithstanding paragraph (1), a quota 
period may not be established that overlaps an existing quota 
period or a special quota period established under subsection 
(b). 
7 u s e 7237. 
SEC. 137. AVAILABILITY OF RECOURSE LOANS FOR HIGH MOISTURE 
FEED GRAINS AND SEED COTTON. 
(a) HIGH MOISTURE FEED GRAINS.— 
(1) RECOURSE LOANS AVAILABLE.—For each of the 1996 
through 2002 crops of corn and grain sorghum, the Secretary 
shall make available recourse loans, as determined by the 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 913 
Secretary, to producers on a farm containing eligible cropland 
covered by a production flexibility contract who— 
(A) normally harvest all or a portion of their crop 
of com or grain sorghum in a high moisture state; 
(B) present— 
(i) certified scale tickets from an inspected, cer-
tified commercial scale, including a licensed warehouse, 
feedlot, feed mill, distillery, or other similar entity 
approved by the Secretary, pursuant to regulations 
issued by the Secretary; or 
(ii) field or other physical measurements of the 
standing or stored crop in regions of the United States, 
as determined by the Secretary, that do not have cer-
tified commercial scales from which certified scale tick-
ets may be obtained within reasonable proximity of 
harvest operation; 
(C) certify that they were the owners of the feed grain 
at the time of delivery to, and that the quantity to be 
placed under loan under this subsection was in fact har-
vested on the farm and delivered to, a feedlot, feed mill, 
or commercial or on-farm high-moisture storage facility, 
or to a facility maintained by the users of com and grain 
sorghum in a high moisture state; and 
(D) comply with deadlines established by the Secretary 
for harvesting the com or grain sorghum and submit 
applications for loans under this subsection within dead-
lines established by the Secretary. 
(2) ELIGIBILITY OF ACQUIRED FEED GRAINS.—A loan under 
this subsection shall be made on a quantity of com or grain 
sorghum of the same crop acquired by the producer equivalent 
to a quantity determined by multiplying— 
(A) the acreage of the corn or grain sorghum in a 
high moisture state harvested on the producer's farm; by 
(B) the lower of the farm program payment yield or 
the actual yield on a field, as determined by the Secretary, 
that is similar to the field from which the com or grain 
sorghum was obtained. 
(3) HIGH MOISTURE STATE DEFINED.—In this subsection, 
the term "high moisture state" means com or grain sorghum 
having a moisture content in excess of Commodity Credit Cor-
poration standards for marketing assistance loans made by 
the Secretary under section 131. 
(b) RECOURSE LOANS AVAILABLE FOR SEED COTTON.— 
(1) UPLAND COITON.—For each of the 1996 through 2002 
crops of upland cotton, the Secretary shgJl make available 
recourse seed cotton loans, as determined by the Secretary, 
to producers on a farm containing eligible cropland covered 
by a production flexibility contract. 
(2) EXTRA LONG STAPLE COTTON.—For each of the 1996 
through 2002 crops of extra long staple cotton, the Secretary 
shall make available recourse seed cotton loans, as determined 
by the Secretary, on any production. 
(c) REPAYMENT RATES.—Repa)rment of a recourse loan made 
under this section shall be at the loan rate established for the 
commodity by the Secretary, plus interest (as determined by the 
Secretary). 
110 STAT. 914 
PUBLIC LAW 104-127—APR. 4, 1996 
Subtitle D—Other Commodities 
CHAPTER 1—DAIRY 
7 use 7251. 
SEC. 141. MILK PRICE SUPPORT PROGRAM. 
(a) SUPPORT ACTIVITIES.—The Secretary of Agriculture shall 
support the price of milk produced in the 48 contiguous States 
through the purchase of cheese, butter, and nonfat dry milk pro-
duced from the milk. 
(b) RATE.—The price of milk shall be supported at the following 
rates per hundredweight for milk containing 3.67 percent butterfat: 
(1) During calendar year 1996, $10.35. 
(2) During calendar year 1997, $10.20. 
(3) During calendar year 1998, $10.05. 
(4) During calendar year 1999, $9.90. 
(c) PURCHASE PRICES.—The support purchase prices under this 
section for each of the products of milk (butter, cheese, and nonfat 
dry milk) announced by the Secretary shall be the same for all 
of that product sold by persons offering to sell the product to 
the Secretary. The purchase prices shall be sufficient to enable 
plants of average efficiency to pay producers, on average, a price 
that is not less than the rate of price support for milk in effect 
under subsection (b). 
(d) SPECIAL RULE FOR BUTTER AND NONFAT DRY MILK PUR-
CHASE PRICES.— 
(1) ALLOCATION OF PURCHASE PRICES.—The Secretary may 
allocate the rate of price support between the purchase prices 
for nonfat dry milk and butter in a manner that will result 
in the lowest level of expenditures by the Commodity Credit 
Corporation or achieve such other objectives as the Secretary 
considers appropriate. Not later than 10 days after making 
or changing an allocation, the Secretary shall notify the 
Committee on Agriculture of the House of Representatives and 
the Committee on Agriculture, Nutrition, and Forestry of the 
Senate of the allocation. Section 553 of title 5, United States 
Code, shall not apply with respect to the implementation of 
this section. 
(2) TIMING OF PURCHASE PRICE ADJUSTMENTS.—The Sec-
retary may make any such adjustments in the purchase prices 
for nonfat dry milk and butter the Secretary considers to be 
necessary not more than twice in each calendar year. 
(e) REFUNDS OF 1995 AND 1996 ASSESSMENTS.— 
(1) REFUND REQUIRED.—The Secretary shall provide for 
a refund of the entire reduction required under section 204(h)(2) 
of the Agricultural Act of 1949 (7 U.S.C. 1446e(h)(2)), as in 
effect on the day before the amendment made by subsection 
(g), in the price of milk received by a producer during calendar 
year 1995 or 1996, if the producer provides evidence that the 
producer did not increase marketings in calendar year 1995 
or 1996 when compared to calendar year 1994 or 1995, respec-
tively. 
(2) EXCEPTION.—This subsection shall not apply with 
respect to a producer for a particular calendar year if the 
producer has already received a refund under section 204(h) 
of the Agricultural Act of 1949 for the same fiscal year before 
the effective date of this section. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 915 
(3) TREATMENT OF REFUND.—^A refund under this sub-
section shall not be considered as any type of price support 
or pajonent for purposes of sections 1211 and 1221 of the 
Food Security Act of 1985 (16 U.S.C. 3811 and 3821). 
(f) COMMODITY CREDIT CORPORATION.—^The Secretary shall 
carry out the program authorized by this section through the 
Commodity Credit Corporation. 
(g) CONFORMING REPEAL.—Effective on the first day of the 
Effective date, 
first month beginning after the date of enactment of this title, 
section 204 of the Agricultural Act of 1949 (7 U.S.C. 1446e) is 
repealed. 
(h) PERIOD OF EFFECTIVENESS.—This section (other than sub-
section (g)) shall be effective only during the period beginning 
on the first day of the first month beginning after the date of 
enactment of this title and ending on December 31, 1999. The 
program authorized by this section shall terminate on December 
31, 1999, and shall be considered to have expired notwithstanding 
section 257 of the Balanced Budget and Emergency Deficit Control 
Act of 1985 (2 U.S.C. 907). 
SEC. 142. RECOURSE LOAN PROGRAM FOR COMMERCIAL PROCESSORS 
7 USC 7252. 
OF DAIRY PRODUCTS. 
(a) RECOURSE LOANS AVAILABLE.—Under such reasonable terms 
and conditions as the Secretary may prescribe, the Secretary shall 
make recourse loans available to commercial processors of eligible 
dairy products to assist the processors to manage inventories of 
eligible dairy products and assure a greater degree of price stability 
for the dairy industry during the year. The Secretary shall use 
the funds, facilities, and authorities of the Commodity Credit Cor-
poration to carry out this section. 
(b) AMOUNT OF LOAN.—^The Secretary shall establish the 
amount of a loan for eligible dairy products, which shall reflect 
a milk equivalent value of $9.90 per hundredweight of milk contain-
ing 3.67 percent butterfat. The rate of interest charged participants 
under this section shall not be less than the rate of interest charged 
the Commodity Credit Corporation by the United States Treasury. 
(c) PERIOD OF LOAN.—^The original term of a recourse loan 
made under this section may not extend beyond the end of the 
fiscal year in which the loan is made. At the end of the fiscal 
year, the Secretary may extend the loan for an additional period 
not to exceed the end of the next fiscal year. 
(d) DEFINITION OF ELIGIBLE DAIRY PRODUCTS.—In this section, 
the term "eligible dairy products" means cheddar cheese, butter, 
and nonfat dry milk. 
(e) EFFECTIVE DATE.—^This section shall be effective beginning 
January 1, 2000. 
SEC. 143. CONSOLIDATION AND REFORM OF FEDERAL MILK MARKET- 
7 USC 7253. 
ING ORDERS. 
(a) >\MENDMENT OF ORDERS.— 
(1) REQUIRED CONSOLIDATION.—The Secretary shall amend 
Federal milk marketing orders issued under section 8c of the 
Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with 
amendments by the Agricultural Marketing Agreement Act of 
1937, to limit the number of Federal milk marketing orders 
to not less than 10 and not more than 14 orders. 
(2) INCLUSION OF CALIFORNIA AS SEPARATE ORDER.—Upon 
the petition and approval of California dairy producers in the 
110 STAT. 916 
PUBLIC LAW 104-127—APR. 4, 1996 
manner provided in section 8c of the Agricultural Adjustment 
Act (7 U.S.C. 608c), reenacted with amendments by the Agricul-
tural Marketing Agreement Act of 1937, the Secretary shall 
designate the State of California as a separate Federal milk 
marketing order. The order covering California shall have the 
right to reblend and distribute order receipts to recognize quota 
value. 
(3) RELATED ISSUES ADDRESSED IN CONSOLIDATION.—^Among 
the issues the Secretary is authorized to implement as part 
of the consolidation of Federal milk marketing orders are the 
following: 
(A) The use of utilization rates and multiple basing 
points for the pricing of fluid milk. 
(B) The use of uniform multiple component pricing 
when developing 1 or more basic formula prices for manu-
facturing milk. 
(4) EFFECT OF EXISTING LAW.—In implementing the consoli-
dation of Federal milk marketing orders and related reforms 
under this subsection, the Secretary may not consider, or base 
any decision on, the table contained in section 8c(5)(A) of the 
Agricultural Adjustment Act (7 U.S.C. 608c(5)(A)), reenacted 
with amendments by the Agricultural Marketing Agreement 
Act of 1937, as added by section 131 of the Food Security 
Act of 1985. 
(b) EXPEDITED PROCESS.— 
(1) USE OF INFORMAL RULEMAKING.—^To implement the 
consolidation of Federal milk marketing orders and related 
reforms under subsection (a), the Secretary shall use the notice 
and comment procedures provided in section 553 of title 5, 
United States Code. 
(2) TIME LIMITATIONS.— 
(A) 
PROPOSED AMENDMENTS.—The Secretary 
shall 
announce the proposed amendments to be made under 
subsection (a) not later than 2 years after the date of 
enactment of this title. 
(B) FINAL AMENDMENTS.—^The Secretary shall imple-
ment the amendments not later than 3 years after the 
date of enactment of this title. 
(3) EFFECT OF COURT ORDER.—^The actions authorized by 
this subsection are intended to ensure the timely publication 
and implementation of new and amended Federal milk market-
ing orders. In the event that the Secretary is enjoined or 
otherwise restrained by a court order from publishing or 
implementing the consolidation and related reforms under sub-
section (a), the length of time for which that injunction or 
other restraining order is effective shall be added to the time 
limitations specified in paragraph (2) thereby extending those 
time limitations by a period of time equal to the period of 
time for which the injunction or other restraining order is 
effective. 
(c) FAILURE TO TIMELY CONSOLIDATE ORDERS.—If the Secretary 
fails to implement the consolidation required under subsection (a)( 1) 
within the time period required under subsection (b)(2)(B) (plus 
any additional period provided under subsection (b)(3)), the Sec-
retary may not assess or collect assessments from milk producers 
or handlers under such section 8c for marketing order administra-
tion and services provided under such section after the end of 
PUBLIC Li^W 104-127—APR. 4, 1996 
110 STAT. 917 
that period until the consolidation is completed. The Secretary 
may not reduce the level of services provided under the section 
on account of the prohibition against assessments, but shall rather 
cover the cost of marketing order administration and services 
through funds available for the Agricultural Marketing Service 
of the Department. 
(d) REPORT REGARDING FURTHER REFORMS.— 
(1) REPORT REQUIRED.—Not later than April 1, 1997, the 
. 
Secretary shall submit to Congress a report— 
(A) reviewing the Federal milk marketing order system 
established pursuant to section 8c of the Agricultural 
Adjustment Act (7 U.S.C. 608c), reenacted with amend- ,; 
ments by the Agricultural Marketing Agreement Act of 
1937, in light of the reforms required by subsection (a); 
(B) describing the efforts underway and the progress 
made in implementing the reforms required by subsection 
(a); and 
(C) containing such recommendations as the Secretary 
considers 
appropriate 
for further 
improvements 
and 
reforms to the Federal milk marketing order system. 
(2) EFFECT OF OTHER LAWS.—^Any limitation imposed by 
Act of Congress on the conduct or completion of reports to 
Congress shall not apply to the report required under this 
section, unless the limitation specifically refers to this section. 
SEC. 144. EFFECT ON FLUID MILK STANDARDS IN STATE OF CALIFOR- 
7 USC 7254. 
NIA. 
Nothing in this Act or any other provision of law shall be 
construed to preempt, prohibit, or otherwise limit the authority 
of the State of California, directly or indirectly, to establish or 
continue to effect any law, regulation, or requirement regarding— 
(1) the percentage of milk solids or solids not fat in fluid 
milk products sold at retail or marketed in the State of Califor-
nia; or 
(2) the labeling of such fluid milk products with regard 
to milk solids or solids not fat. 
SEC. 145. MILK MANUFACTURING MARKETING ADJUSTMENT. 
7 USC 7255. 
(a) MAXIMUM ALLOWANCES ESTABLISHED.—No State shall pro-
vide for a manufacturing allowance for the processing of milk in 
excess of— 
(1) $1.65 per hundredweight of milk for milk manufactured 
into butter and nonfat dry milk; and 
(2) $1.80 per hundredweight of milk for milk manufactured 
into cheese. 
(b) MANUFACTURING ALLOWANCE DEFINED.—In this section, the 
term "manufacturing allowance" means— 
(1) the amount by which the product price value of butter 
and nonfat dry milk manufactured from a hundred pounds 
of milk containing 3.5 pounds of butterfat and 8.7 pounds 
of milk solids not fat resulting from a State's yield and product 
price formulas exceeds the class price for the milk used to 
produce those products; or 
(2) the amount by which the product price value of cheese 
manufactured from a hundred pounds of milk containing 3.5 
pounds of butterfat and 8.7 pounds of milk solids not fat result-
ing from a State's yield and product price formulas exceeds 
the class price for the milk used to produce cheese. 
110 STAT. 918 
PUBLIC LAW 104-127—APR. 4, 1996 
(c) EFFECT OF VIOLATION.—If the Secretary determines follow-
ing a hearing that a State has in effect a manufacturing allowance 
that exceeds the manufacturing allowance authorized in subsection 
(a), the Secretary shall suspend purchases of cheddar cheese, butter, 
and nonfat dry milk produced in that State until such time as 
the State complies with such subsection. 
(d) EFFECTIVE DATE; IMPLEMENTATION.—This section (other 
than subsection (e)) shall be effective during the period beginning 
on the first day of the first month beginning after the date of 
enactment of this title and ending on December 31, 1999. During 
that period, the Secretary may exercise the authority provided 
to the Secretary under this section without regard to the issuance 
of regulations intended to carry out this section. 
Effective date. 
(e) CONFORMING REPEAL.—Effective on the first day of the 
first month beginning after the date of enactment of this title, 
section 102 of the Food, Agriculture, Conservation, and Trade Act 
of 1990 (7 U.S.C. 1446e-l) is repealed. 
SEC. 146. PROMOTION. 
(a) CONGRESSIONAL PURPOSE.—Section 1999B(a) of the Fluid 
Milk Promotion Act of 1990 (7 U.S.C. 6401(a)) is amended— 
(1) by redesignating paragraphs (6), (7) and (8) as para-
graphs (7), (8) and (9), respectively; and 
(2) by inserting after paragraph (5) the following: 
"(6) the congressional purpose underlying this subtitle is 
to maintain and expand markets for fluid milk products, not 
to maintain or expand any processor's share of those markets 
and that the subtitle does not prohibit or restrict individual 
advertising or promotion of fluid milk products since the pro-
grams created and funded by this subtitle are not extended 
to replace individual advertising and promotion efforts;". 
(b) CONGRESSIONAL PoLiCY.^^ection 1999B(b) of the Fluid Milk 
Promotion Act of 1990 (7 U.S.C. 6401(b)) is amended to read as 
follows: 
"(b) POLICY.—It is declared to be the policy of Congress that 
it is in the public interest to authorize the establishment, through 
the exercise of powers provided in this subtitle, of an orderly proce-
dure for developing, financing, through adequate assessments on 
fluid milk products produced in the United States and carrying 
out an effective, continuous, and coordinated program of promotion, 
research, and consumer information designed to strengthen the 
position of the dairy industry in the marketplace and maintain 
and expand domestic and foreign markets and uses for fluid milk 
products, the purpose of which is not to compete with or replace 
individual advertising or promotion efforts designed to promote 
individual brand name or trade name fluid milk products, but 
rather to maintain and expand the markets for all fluid milk 
products, with the goal and purpose of this subtitle being a national 
governmental goal that authorizes and funds programs that result 
in government speech promoting government objectives.". 
(c) RESEARCH.—Section 1999C(6) of the Fluid Milk Promotion 
Act of 1990 (7 U.S.C. 6402(6)) is amended to read as follows: 
"(6) 
RESEARCH.—The 
term 
'research' 
means 
market 
research to support advertising and promotion efforts, including 
educational activities, research directed to product characteris-
tics, product development, including new products or improved 
PUBLIC Li^W 104-127—APR. 4, 1996 
110 STAT. 919 
technology in production, manufacturing or processing of milk 
and the products of milk.". 
(d) VOTING.— 
(1) INITIAL REFERENDA.—Section 1999N(b)(2) of the Fluid 
Milk Promotion Act of 1990 (7 U.S.C. 6413(b)(2)) is amended 
by striking "all processors" and inserting "fluid milk processors 
voting in the referendum". 
(2) SUSPENSION OR TERMINATION.—Section 19990(c) of such 
Act (7 U.S.C. 6414(c)) is amended— 
(A) in paragraph (1), by striking "all processors" and 
inserting "fluid milk processors voting in the preceding 
referendum"; and 
(B) in paragraph (2)(B), by striking "all processors" 
and inserting "fluid milk processors voting in the referen-
dum". 
(e) DURATION.—Section 19990(a) of the Fluid Milk Promotion 
Act of 1990 (7 U.S.C. 6414(a)) is amended by striking "1996" and 
inserting "2002". 
SEC. 147. NORTHEAST INTERSTATE DAIRY COMPACT. 
Congress. 
Congress hereby consents to the Northeast Interstate Dairy 
7 use 7256. 
Compact entered into among the States of Connecticut, Maine, 
Massachusetts, New Hampshire, Rhode Island and Vermont as 
specified in section 1(b) Senate Joint Resolution 28 of the 104th 
Congress, as placed on the calendar of the Senate, subject to the 
following conditions: 
(1) FINDING OF COMPELLING PUBLIC INTEREST.—Based upon 
a finding by the Secretary of a compelling public interest in 
the Compact region, the Secretary may grant the States that 
have ratified the Northeast Interstate Dairy Compact, as of 
the date of enactment of this title, the authority to implement 
the Northeast Interstate Dairy Compact. 
(2) LIMITATION ON MANUFACTURING PRICE.—The Northeast 
Interstate Dairy Compact Commission shall not regulate Class 
II, Class III, or Class III-A milk used for manufacturing pur-
poses or any other milk, other than Class I (fluid) milk, as 
defined by a Federal milk marketing order issued under section 
8c of the Agricultural Adjustment Act (7 U.S.C. 608c) reenacted 
with amendments by the Agricultural Marketing Agreement 
Act of 1937. 
(3) DURATION.—(Consent for the Northeast Interstate Dairy 
Compact shall terminate concurrent with the Secretary's 
implementation of the dairy pricing and Federal milk marketing 
order consolidation and reforms under section 143. 
(4) ADDITIONAL STATES.—Delaware, New Jersey, New York, 
Pennsylvania, Maryland, and Virginia are the only additional 
States that may join the Northeast Interstate Dairy Compact, 
individually or otherwise, if upon entry the State is contiguous 
to a participating State and if Congress consents to the entry 
of the State into the Compact after the date of enactment 
of this title. 
(5) COMPENSATION OF COMMODITY CREDIT CORPORATION.— 
Before the end of each fiscal year that a Compact price regula-
tion is in effect, the Northeast Interstate Dairy Compact 
Commission shall compensate the Commodity Credit Corpora-
tion for the cost of any purchases of milk and milk products 
by the Corporation that result from the projected rate of 
110 STAT. 920 
PUBLIC LAW 104-127—APR. 4, 1996 
increase in milk production for the fiscal year within the Com-
pact region in excess of the projected national average rate 
of the increase in milk production, as determined by the Sec-
retary. 
(6) 
MILK 
MARKETING 
ORDER 
ADMINISTRATOR.—^At 
the 
request of the Northeast Interstate Dairy Compact Commission, 
the Administrator of the applicable Federal milk marketing 
order issued under section 8(c)5 of the Agricultural Adjustment 
Act (7 U.S.C. 608c), reenacted with amendments by the Agricul-
tural Marketing Agreement Act of 1937, shall provide technical 
assistance to the Compact Commission and be compensated 
for that assistance. 
(7) FURTHER CONDITIONS.—^The Northeast Interstate Dairy 
Compact Commission shall not prohibit or in any way limit 
the marketing in the Compact region of any milk or milk 
product produced in any other production area in the United 
States. The Compact Commission shall respect and abide by 
the ongoing procedures between Federal milk marketing orders 
with respect to the sharing of proceeds from sales within the 
Compact region of bulk milk, packaged milk, or producer milk 
originating from outside of the Compact region. The Compact 
Commission shall not use compensatory payments under sec-
tion 10(6) of the Compact as a barrier to the entry of milk 
into the Compact region or for any other purpose. Establish-
ment of a Compact over-order price, in itself, shall not be 
considered a compensatory payment or a limitation or prohibi-
tion on the marketing of milk. 
SEC. 148. DAIRY EXPORT INCENTIVE PROGRAM. 
(a) DURATION.—Section 153(a) of the Food Security Act of 1985 
(15 U.S.C. 713a-14(a)) is amended by striking "2001" and inserting 
"2002". 
(b) SOLE DISCRETION.—Section 153(b) of the Food Security Act 
of 1985 (15 U.S.C. 713a-14(b)) is amended by inserting "sole" before 
"discretion". 
(c) ELEMENTS OF PROGRAM.—Section 153(c) of the Food Security 
Act of 1985 (15 U.S.C. 713a-14(c)) is amended— 
(1) by striking "and" at the end of paragraph (1); 
(2) by striking the period at the end of paragraph (2) 
and inserting a semicolon; and 
(3) by adding at the end the following: 
"(3) the maximum volume of dairy product exports allow-
able consistent with the obligations of the United States as 
a member of the World Trade Organization is exported under 
the program each year (minus the volume sold under section 
1163 of the Food Security Act of 1985 (Public Law 99-198; 
7 U.S.C. 1731 note) during that year), except to the extent 
that the export of such a volume under the program would, 
in the judgment of the Secretary, exceed the limitations on 
the value set forth in subsection (f); and 
"(4) payments may be made under the program for exports 
to any destination in the world for the purpose of market 
development, except a destination in a country with respect 
to which shipments from the United States are otherwise 
restricted by law.". 
(d) MARKET DEVELOPMENT.—Section 153(e)(1) of the Food Secu-
rity Act of 1985 (15 U.S.C. 713a-14(e)(l)) is amended— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 921 
(1) by striking "and" and inserting "the"; and 
(2) by inserting before the period the following: ", and 
any additional amount that may be required to assist in the 
development of world markets for United States dairy prod-
ucts". 
(e) MAXIMUM ALLOWABLE AMOUNTS.—Section 153 of the Food 
Security Act of 1985 (15 U.S.C. 713a-14) is amended by adding 
at the end the following: 
"(f) REQUIRED FUNDING.— 
"(1) IN GENERAL.—Except as provided in paragraph (2), 
the Commodity Credit Corporation shall in each year use money 
and commodities for the program under this section in the 
maximum amount consistent with the obligations of the United 
States as a member of the World Trade Organization, minus 
the amount expended under section 1163 of the Food Security 
Act of 1985 (PubUc Law 99-198; 7 U.S.C. 1731 note) during 
that year. 
"(2) VOLUME LIMITATIONS.—^The Commodity Credit Cor-
poration may not exceed the limitations specified in subsection 
(c)(3) on the volume of allowable dairy product exports.". 
SEC. 149. AUTHORITY TO ASSIST IN ESTABLISHMENT AND MAINTE- 
7 USC 7257. 
NANCE O F O N E O R M O R E EXPORT TRADING COMPANIES. 
The Secretary of Agriculture shall, consistent with the obliga-
tions of the United States as a member of the World Trade 
Organization, provide such advice and assistance to the United 
States dairy industry as may be necessary to enable that industry 
to establish and maintain one or more export trading companies 
under the Export Trading Company Act of 1982 (15 U.S.C. 4001 
et seq.) for the purpose of facilitating the international market 
development for and exportation of dairy products produced in 
the United States. 
SEC. 150. STANDBY AUTHORITY TO INDICATE ENTITY BEST SUITED 
7 USC 7258. 
TO PROVIDE INTERNATIONAL MARKET 
DEVELOPMENT 
AND EXPORT SERVICES. 
(a) INDICATION OF ENTITY BEST SUITED TO ASSIST INTER-
NATIONAL MARKET DEVELOPMENT FOR AND EXPORT OF UNITED 
STATES DAIRY PRODUCTS.—^The Secretary of Agriculture shall 
indicate which entity or entities autonomous of the Government 
of the United States, which seeks such a designation, is best suited 
to facilitate the international market development for and expor-
tation of United States dairy products, if the Secretary determines 
that— 
(1) the United States dairy industry has not established 
an export trading company under the Export Trading Company 
Act of 1982 (15 U.S.C. 4001 et seq.) for the purpose of facilitat-
ing the international market development for an exportation 
of dairy products produced in the United States on or before 
June 30, 1997; or 
(2) the quantity of exports of United States dairy products 
during the 12-month period preceding July 1, 1998 does not 
exceed the quantity of exports of United States dairy products 
during the 12-month period preceding July 1, 1997 by 1.5 
billion pounds (milk equivalent, total solids basis). 
(b) FUNDING OF EXPORT ACTIVITIES.—The Secretary shall assist 
the entity or entities identified under subsection (a) in identifying 
110 STAT. 922 
PUBLIC LAW 104-127—APR. 4, 1996 
sources of funding for the activities specified in subsection (a) 
from within the dairy industry and elsewhere. 
(c) APPLICATION OF SECTION.—This section shall apply only 
during the period beginning on July 1, 1997 and ending on Septem-
ber 30, 2000. 
7 u s e 7259. 
SEC. 151. STUDY AND REPORT REGARDING POTENTIAL IMPACT OF 
URUGUAY ROUND ON PRICES, INCOME, AND GOVERN-
MENT PURCHASES. 
(a) STUDY.—The Secretary of Agriculture shall conduct a study, 
on a variety by variety of cheese basis, to determine the potential 
impact on milk prices in the United States, dairy producer income, 
and Federal dairy program costs, of the allocation of additional 
cheese granted access to the United States as a result of the 
obligations of the United States as a member of the World Trade 
Organization. 
(b) REPORT.—Not later than June 30, 1997, the Secretary shall 
report to the Committee on Agriculture, Nutrition, and Forestry 
of the Senate and the Committee on Agriculture of the House 
of Representatives the results of the study conducted under this 
section. 
(c) RULE OF CONSTRUCTION.—^Any limitation imposed by Act 
of Congress on the conduct or completion of studies or reports 
to Congress shall not apply to the study and report required under 
this section, unless the limitation specifically refers to this section. 
SEC. 152. PROMOTION OF UNITED STATES DAIRY PRODUCTS IN INTER-
NATIONAL MARKETS THROUGH DAIRY PROMOTION PRO-
GRAM. 
Section 113(e) of the Dairy Production Stabilization Act of 
1983 (7 U.S.C. 4504(e)) is amended by adding at the end the 
following new sentence: "For each of fiscal years 1997 through 
2001, the Board's budget may provide for the expenditure of reve-
nues available to the Board to develop international markets for, 
and to promote within such markets, the consumption of dairy 
products produced in the United States from milk produced in 
the United States.". 
CHAPTER 
2—PEANUTS 
AND 
SUGAR 
7 u s e 7271. 
SEC. 155. PEANUT PROGRAM. 
(a) QUOTA PEANUTS.— 
(1) AVAILABILITY OF LOANS.—The Secretary shall make 
nonrecourse loans available to producers of quota peanuts. 
(2) LOAN RATE.—The national average quota loan rate for 
quota peanuts shall be $610 per ton. 
(3) INSPECTION, HANDLING, OR STORAGE.—The loan amount 
may not be reduced by the Secretary by any deductions for 
inspection, handling, or storage. 
(4) LOCATION AND OTHER FACTORS.—The Secretary may 
make adjustments in the loan rate for quota peanuts for loca-
tion of peanuts and such other factors as are authorized by 
section 162. 
(5) OFFERS FROM HANDLERS.—If a producer markets a quota 
peanut crop, meeting quality requirements for domestic edible 
use, through the marketing association loan for two consecutive 
marketing years and the Secretary determines that a handler 
provided the producer with a written offer, upon delivery, for 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 923 
the purchase of the quota peanut crops at a price equal to 
or in excess of the quota support price, the producer shall 
be ineligible for quota price support for the next marketing 
year. The Secretary shall establish the method by which a 
producer may appeal a determination under this paragraph 
regarding ineligibility for quota price support. 
(b) ADDITIONAL PEANUTS.— 
(1) IN GENERAL.—Subject to paragraph (2), the Secretary 
shall make nonrecourse loans available to producers of addi-
tional peanuts at such rates as the Secretary finds appropriate, 
taking into consideration the demand for peanut oil and peanut 
meal, expected prices of other vegetable oils and protein meals, 
and the demand for peanuts in foreign markets. 
(2) LIMITATION.—The Secretary shall establish the support 
rate on additional peanuts at a level estimated by the Secretary 
to ensure that there are no losses to the Commodity Credit 
Corporation on the sale or disposal of the peanuts. 
(3) ANNOUNCEMENT.—The Secretary shall announce the 
loan rate for additional peanuts of each crop not later than 
February 15 preceding the marketing year for the crop for 
which the loan rate is being determined. 
(c) AREA MARKETING ASSOCIATIONS.— 
(1) WAREHOUSE STORAGE LOANS.— 
(A) IN GENERAL.—In carrying out subsections (a) and 
(b), the Secretary shall make warehouse storage loans 
available in each of the producing areas (described in sec-
tion 1446.95 of title 7 of the Code of Federal Regulations 
(January 1, 1989)) to a designated area marketing associa-
tion of peanut producers that is selected and approved 
by the Secretary and that is operated primarily for the 
purpose of conducting the loan activities. The Secretary 
may not make warehouse storage loans available to any 
cooperative that is engaged in operations or activities 
concerning peanuts other than those operations and activi-
ties specified in this section and section 358e of the Agricul-
tural Adjustment Act of 1938 (7 U.S.C. 1359a). 
(B) ADMINISTRATIVE AND SUPERVISORY ACTIVITIES.—^An 
area marketing association shall be used in administrative 
and supervisory activities relating to loans and marketing 
activities under this section and section 358e of the Agricul-
tural Adjustment Act of 1938 (7 U.S.C. 1359a). 
(C) ASSOCIATION COSTS.—Loans made to the associa-
tion under this paragraph shall include such costs as the 
area marketing association reasonably may incur in carry-
ing out the responsibilities, operations, and activities of 
the association under this section and section 358e of the 
Agricultural Adjustment Act of 1938 (7 U.S.C. 1359a). 
(2) POOLS FOR QUOTA AND ADDITIONAL PEANUTS.— 
(A) IN GENERAL.—The Secretary shall require that each Records. 
area marketing association establish pools and maintain 
New Mexico, 
complete and accurate records by area and segregation 
for quota peanuts handled under loan and for additional 
peanuts placed under loan, except that separate pools shall 
be established for Valencia peanuts produced in New Mex-
ico. 
(B) 
ELIGIBILITY TO 
PARTICIPATE IN NEW MEXICO 
POOLS.— 
110 STAT. 924 
PUBLIC LAW 104-127—APR. 4, 1996 
(i) IN GENERAL.^Except as provided in clause (ii), 
in the case of the 1996 and subsequent crops, Valencia 
peanuts not physically produced in the State of New 
Mexico shall not be eligible to participate in the pools 
of the State. 
(ii) EXCEPTION.—^A producer of Valencia peanuts 
may enter Valencia peanuts that are produced in Texas 
into the pools of New Mexico in a quantity not greater 
than the average annual quantity of the peanuts that 
the producer entered into the New Mexico pools for 
the 1990 through 1995 crops. 
(C) TYPES OF PEANUTS.—Bright hull and dark hull 
Valencia peanuts shall be considered as separate types 
for the purpose of establishing the pools. 
(D) NET GAINS.—Net gains on peanuts in each pool, 
unless otherwise approved by the Secretary, shall be 
distributed only to producers who placed peanuts in the 
pool and shall be distributed in proportion to the value 
of the peanuts placed in the pool by each producer. Net 
gains for peanuts in each pool shall consist of the following: 
(i) QUOTA PEANUTS.—For quota peanuts, the net 
gains over and above the loan indebtedness and other 
costs or losses incurred on peanuts placed in the pool. 
(ii) ADDITIONAL PEANUTS.—For additional peanuts, 
the net gains over and above the loan indebtedness 
and other costs or losses incurred on peanuts placed 
in the pool for additional peanuts. 
(d) LOSSES.—Losses in quota area pools shall be covered using 
the following sources in the following order of priority: 
(1) TRANSFERS FROM ADDITIONAL LOAN POOLS.—^The pro-
ceeds due any producer from any pool shall be reduced by 
the amount of any loss that is incurred with respect to peanuts 
transferred from an additional loan pool to a quota loan pool 
by the producer under section 358-1(b)(8) of the Agricultural 
Adjustment Act of 1938 (7 U.S.C. 1358-1(b)(8)). 
(2) PRODUCERS IN SAME POOL.—Further losses in an area 
quota pool shall be offset by reducing the gain of any producer 
in the pool by the amount of pool gains attributed to the 
same producer from the sale of additional peanuts for domestic 
and edible export use. 
(3) OFFSET WITHIN AREA.—Further losses in an area quota 
pool shall be offset by any gains or profits from additional 
peanuts (other than separate type pools established under sub-
section (c)(2)(A) for Valencia peanuts produced in New Mexico) 
owned or controlled by the Commodity Credit Corporation in 
that area and sold for domestic edible use, in accordance with 
regulations issued by the Secretary. This paragraph shall not 
apply to profits or gains from a farm with 1 acre or less 
of peanut production. 
(4) FIRST USE OF MARKETING ASSESSMENTS.—The Secretary 
shall use funds collected under subsection (g) (except funds 
attributable to handlers) to offset further losses in area quota 
pools. The Secretary shall transfer to the Treasury those funds 
collected under subsection (g) and available for use under this 
paragraph that the Secretary determines are not required to 
cover losses in area quota pools. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 925 
(5) CROSS COMPLIANCE.—Further losses in area quota pools, Regulations, 
other than losses incurred as a result of transfers from addi-
tional loan pools to quota loan pools under section 358-1(b)(8) 
of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-
1(b)(8)), shall be offset by any gains or profits from quota 
pools in other production areas (other than separate type pools 
established under subsection (c)(2)(A) for Valencia peanuts pro-
duced in New Mexico) in such manner as the Secretary shall 
by regulation prescribe. 
(6) OFFSET GENERALLY.—If losses in an area quota pool 
have not been entirely offset under the preceding paragraphs, 
further losses shall be offset by any gains or profits from 
additional peanuts (other than separate type pools established 
under subsection (c)(2)(A) for Valencia peanuts produced in 
New Mexico) owned or controlled by the Commodity Credit 
Corporation and sold for domestic edible use, in accordance 
with regulations issued by the Secretary. This paragraph shall 
not apply to profits or gains from a farm with 1 acre or less 
of peanut production. 
(7) SECOND USE OF MARKETING ASSESSMENTS.—^The Sec-
retary shall use funds collected under subsection (g) and attrib-
utable to handlers to offset further losses in area quota pools. 
The Secretary shall transfer to the Treasury those funds col-
lected under subsection (g) and available for use under this 
paragraph that the Secretary determines are not required to 
cover losses in area quota pools. 
(8) INCREASED ASSESSMENTS.—If use of the authorities pro-
vided in the preceding paragraphs is not sufficient to cover 
losses in an area quota pool, the Secretary shall increase the 
marketing assessment for producers established under sub-
section (g) by such an amount as the Secretary considers nec-
essary to cover the losses. The increased assessment shall apply 
only to quota peanuts in the production area covered by the 
pool. Amounts collected under subsection (g) as a result of 
the increased assessment shall be retained by the Secretary 
to cover losses in that pool. 
(e) DISAPPROVAL OF QUOTAS.—Notwithstanding any other provi-
sion of law, no loan for quota peanuts may be made available 
by the Secretary for any crop of peanuts with respect to which 
poundage quotas have been disapproved by producers, as provided 
for in section 358-1(d) of the Agricultural Adjustment Act of 1938 
(7 U.S.C. 1358-l(d)). 
(f) QUALITY IMPROVEMENT.— 
(1) IN GENERAL.—^With respect to peanuts under loan, the 
Secretary shall— 
(A) promote the crushing of peanuts at a greater risk 
of deterioration before peanuts of a lesser risk of deteriora-
tion; 
(B) ensure that all Commodity Credit Corporation 
inventories of peanuts sold for domestic edible use must 
be shown to have been officially inspected by licensed 
Department inspectors both as farmer stock and shelled 
or cleaned in-shell peanuts; 
(C) continue to endeavor to operate the peanut program 
so as to improve the quality of domestic peanuts and ensure 
the coordination of activities under the Peanut Administra-
tive Committee established under Marketing Agreement 
110 STAT. 926 
PUBLIC LAW 104-127—APR. 4, 1996 
No. 146, regulating the quality of domestically produced 
peanuts (under the Agricultural Adjustment Act (7 U.S.C. 
601 et seq.), reenacted with amendments by the Agricul-
tural Marketing Agreement Act of 1937); and 
(D) ensure that any changes made in the peanut pro-
gram as a result of this subsection requiring additional 
production or handling at the farm level shall be reflected 
as an upward adjustment in the Department loan schedule. 
(2) EXPORTS AND OTHER PEANUTS.—^The Secretary shall 
require that all peanuts in the domestic and export markets 
fully comply with all quality standards under Marketing Agree-
ment No. 146. 
(g) MARKETING ASSESSMENT.— 
(1) IN GENERAL.—^The Secretary shall provide for a non-
refundable marketing assessment. The assessment shall be 
made on a per pound basis in an amount equal to 1.1 percent 
for each of the 1994 and 1995 crops, 1.15 percent for the 
1996 crop, and 1.2 percent for each of the 1997 through 2002 
crops, of the national average quota or additional peanut loan 
rate for the applicable crop. 
(2) FIRST PURCHASERS.— 
(A) IN GENERAL.—Except as provided under paragraphs 
(3) and (4), the first purchaser of peanuts shall— 
(i) collect from the producer a marketing assess-
ment equal to the quantity of peanuts acquired multi-
plied by— 
(I) in the case of each of the 1994 and 1995 
crops, .55 percent of the applicable national aver-
age loan rate; 
(II) in the case of the 1996 crop, .6 percent 
of the applicable national average loan rate; and 
(III) in the case of each of the 1997 through 
2002 crops, .65 percent of the applicable national 
average loan rate; 
(ii) pay, in addition to the amount collected under 
clause (i), a marketing assessment in an amount equal 
to the quantity of peanuts acquired multiplied by .55 
percent of the applicable national average loan rate; 
and 
(iii) remit the amounts required under clauses (i) 
and (ii) to the Commodity Credit Corporation in a 
manner specified by the Secretary. 
(B) DEFINITION OF FIRST PURCHASER.—In this sub-
section, the term "first purchaser" means a person acquir-
ing peanuts from a producer except that in the case of 
peanuts forfeited by a producer to the Commodity Credit 
Corporation, the term means the person acquiring the pea-
nuts from the Commodity Credit Corporation. 
(3) OTHER PRIVATE MARKETINGS.—In the case of a private 
marketing by a producer directly to a consumer through a 
retail or wholesale outlet or in the case of a marketing by 
the producer outside of the continental United States, the pro-
ducer shall be responsible for the full amount of the assessment 
and shall remit the assessment by such time as is specified 
by the Secretary. 
(4) LOAN PEANUTS.—In the case of peanuts that are pledged 
as collateral for a loan made under this section, the producer 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 927 
portion of the assessment shall be deducted from the proceeds 
of the loan. The remainder of the assessment shall be paid 
by the first purchaser of the peanuts. For purposes of computing 
net gains on peanuts under this section, the reduction in loan 
proceeds shall be treated as having been paid to the producer. 
(5) PENALTIES.—If any person fails to collect or remit the 
reduction required by this subsection or fails to comply with 
the requirements for recordkeeping or otherwise as are required 
by the Secretary to carry out this subsection, the person shall 
be liable to the Secretary for a civil penalty up to an amount 
determined by multiplying— 
(A) the quantity of peanuts involved in the violation; 
by 
(B) the national average quota peanut rate for the 
applicable crop year. 
(6) ENFORCEMENT.—^The Secretary may enforce this sub-
section in the courts of the United States. 
(h) CROPS.—Subsections (a) through (g) shall be effective only 
for the 1996 through 2002 crops of peanuts. 
(i) POUNDAGE QUOTAS.— 
(1) IN GENERAL.—Part VI of subtitle B of title III of the 
Agricultural Adjustment Act of 1938 is amended— 
(A) in section 358-1 (7 U.S.C. 1358-1)— 
(i) in the section heading, by striking "i99i 
THROUGH 1997 CROPS OF"; 
(ii) in subsections 
(a)(1), 
(b)(1)(B), (b)(2)(A), 
(b)(2)(C), and (b)(3)(A), by striking "of the 1991 through 
1997 marketing years" each place it appears and 
inserting "marketing year"; 
(iii) in subsection (a)(3), by striking "1990" and 
inserting "1990, for the 1991 through 1995 marketing 
years, and 1995, for the 1996 through 2002 marketing 
years"; 
(iv) in subsection (b)(1)(A)— 
(I) by striking "each of the 1991 through 1997 
marketing years" and inserting "each marketing 
year"; and 
(II) in clause (i), by inserting before the semi-
colon the following: ", in the case of the 1991 
through 1995 marketing years, and the 1995 
marketing year, in the case of the 1996 through 
2002 marketing years"; 
(v) in subsection (b)(1), by adding at the end the 
following: 
"(D) CERTAIN FARMS INELIGIBLE FOR QUOTA.—Effective 
beginning with the 1998 crop, the Secretary shall not estab-
lish a farm poundage quota under subparagraph (A) for 
a farm owned or controlled by— 
"(i) a municipality, airport authority, school, col-
lege, refuge, or other public entity (other than a univer-
sity used for research purposes); or 
"(ii) a person who is not a producer and resides 
in another State."; 
(vi) in subsection (b)(2), by adding at the end the 
following: 
"(E) TRANSFER OF QUOTA FROM INELIGIBLE FARMS.— 
Any farm poundage quota held at the end of the 1996 
Effective date. 
Effective date. 
110 STAT. 928 
PUBLIC LAW 104-127—APR. 4, 1996 
marketing year by a farm described in paragraph (1)(D) 
shall be allocated to other farms in the same State on 
such basis as the Secretary may by regulation prescribe."; 
and 
(vii) in subsection (f), by striking "1997" and insert-
ing "2002"; 
(B) in section 358b (7 U.S.C. 1358b)— 
(i) in the section heading, by striking "i99l 
THROUGH 1995 CROPS OF"; and 
(ii) in subsection (c), by striking "1995" and insert-
ing "2002"; 
(C) in section 358c(d) (7 U.S.C. 1358c(d)), by striking 
"1995" and inserting "2002"; and 
(D) in section 358e (7 U.S.C. 1359a)— 
(i) in the section heading, by striking "FOR 1991 
THROUGH 1997 CROPS OF PEANUTS"; and 
(ii) in subsection (i), by striking "1997" and insert-
ing "2002". 
(2) ELIMINATION OF QUOTA FLOOR.—Section 358-1(a)(1) of 
the Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-1(a)(1)) 
is amended by striking the second sentence. 
(3) TEMPORARY QUOTA ALLOCATION.—Section 358-1 of the 
Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-1) is 
amended— 
(A) in subsection (a)(1), by striking "domestic edible, 
seed," and inserting "domestic edible use (except seed)"; 
and 
(B) in subsection (b)(2)— 
(i) in subparagraph (A), by striking "subparagraph 
(B) and subject to"; and 
(ii) by striking subparagraph (B) and inserting 
the following: 
"(B) TEMPORARY QUOTA ALLOCATION.— 
"(i) ALLOCATION RELATED TO SEED PEANUTS.—^Tem-
porary allocation of quota pounds for the marketing 
year only in which the crop is planted shall be made 
to producers for each of the 1996 through 2002 market-
ing years as provided in this subparagraph. 
"(ii) QUANTITY.—The temporary quota allocation 
shall be equal to the pounds of seed peanuts planted 
on the farm, as may be adjusted and determined under 
regulations prescribed by the Secretary. 
"(iii) ADDITIONAL QUOTA.—The temporary alloca-
tion of quota pounds under this paragraph shall be 
in addition to the farm poundage quota otherwise 
established under this subsection and shall be credited, 
for the applicable marketing year only, in total, to 
the producer of the peanuts on the farm in a manner 
prescribed by the Secretary. 
"(iv) EFFECT OF OTHER REQUIREMENTS.—Nothing 
in this section alters or changes the requirements 
regarding the use of quota and additional peanuts 
established by section 358e(b).", 
(4) UNDERMARKETINGS.—Part VI of subtitle B of title III 
of the Agricultural Adjustment Act of 1938 is amended— 
(A) in section 358-l(b) (7 U.S.C. 1358-1(b))— 
PUBLIC LA.W 104-127—APR. 4, 1996 
110 STAT. 929 
(i) in paragraph 
(1)(B), by striking 
"includ-
ing—" and clauses (i) and (ii) and inserting "including 
any increases resulting from the allocation of quotas 
voluntarily released for 1 year under paragraph (7)."; 
(ii) in paragraph (3)(B), by striking "include—" 
and clauses (i) and (ii) and inserting "include any 
increase resulting from the allocation of quotas volun-
tarily released for 1 year under paragraph (7)."; and 
(iii) by striking paragraphs (8) and (9); and 
(B) in section 358b(a) (7 U.S.C. 1358b(a))— 
(i) in paragraph (2), by striking "(including any 
applicable under marketings)"; and 
(ii) in paragraph (3), by striking "(including any 
applicable undermarketings)". 
(5) DISASTER TRANSFERS.—Section 358-1(b) of the Agricul-
tural Adjustment Act of 1938 (7 U.S.C. 1358-1(b)), as amended 
by paragraph (4)(A)(iii), is amended by adding at the end the 
following: 
"(8) DISASTER TRANSFERS.— 
"(A) IN GENERAL.—Except as provided in subparagraph 
Regulations. 
(B), additional peanuts produced on a farm from which 
the quota poundage was not harvested and marketed 
because of drought, flood, or any other natural disaster, 
or any other condition beyond the control of the producer, 
may be transferred to the quota loan pool for pricing pur-
poses on such basis as the Secretary shall by regulation 
provide. 
"(B) LIMITATION.—^The poundage of peanuts transferred 
under subparagraph (A) shall not exceed the difference 
between— 
"(i) the total quantity of peanuts meeting quality 
requirements for domestic edible use, as determined 
by the Secretary, marketed from the farm; and 
"(ii) the total farm poundage quota, excluding 
quota pounds transferred to the farm in the fall. 
"(C) SUPPORT RATE.—Peanuts transferred under this 
paragraph shall be supported at 70 percent of the quota 
support rate for the marketing years in which the transfers 
occur. The transfers for a farm shall not exceed 25 percent 
of the total farni quota pounds, excluding pounds trans-
ferred in the fall.". 
(6) SALE OR LEASE.—Section 358b(a) of the Agricultural 
Adjustment Act of 1938 (7 U.S.C. 1358b(a)) is amended— 
(A) by striking paragraph (1) and inserting the follow-
ing: 
"(1) SALE AND LEASE AUTHORITY.— 
"(A) SALE OR LEASE WITHIN SAME STATE.—Subject to 
subparagraph (B) and such terms and conditions as the 
Secretary may prescribe, the owner, or operator with the 
permission of the owner, of a farm in a State for which 
a farm poundage quota has been established may sell or 
lease all or any part of the poundage quota to any other 
owner or operator of a farm within the same State for 
transfer to the farm. However, any such lease of poundage 
quota may be entered into in the fall or after the normal 
planting season— 
110 STAT. 930 
PUBLIC LAW 104-127—APR. 4, 1996 
"(i) if not less than 90 percent of the basic quota 
(the farm quota and temporary quota transfers), plus 
any poundage quota transferred to the farm under 
this subsection, has been planted or considered planted 
on the farm from which the quota is to be leased; 
and 
"(ii) under such terms and conditions as the Sec-
retary may by regulation prescribe. 
"In the case of a fall transfer or a transfer after the normal 
planting season by a cash lessee, the landowner shall not 
be required to sign the transfer authorization. A fall trans-
fer or a transfer after the normal planting season may 
be made not later than 72 hours after the peanuts that 
are the subject of the transfer are inspected and graded. 
"(B) PERCENTAGE LIMITATIONS ON SPRING TRANSFERS.— 
Spring transfers under subparagraph (A) by sale or lease 
of a quota for farms in a county to any owner or operator 
of a farm outside the county within the same State shall 
not exceed the applicable percentage specified in this 
subparagraph of the quotas of all farms in the originating 
county (as of January 1, 1996) for the crop year in which 
the transfer is made, plus the total amount of quotas 
eligible for transfer from the originating county in the 
preceding crop year that were not transferred in that year 
or that were transferred through an expired lease. How-
ever, not more than an aggregate of 40 percent of the 
total poundage quota within a county (as of January 1, 
1996) may be transferred outside of the county. Cumulative 
unexpired transfers outside of a county may not exceed 
for a crop year the following: 
"(i) For the 1996 crop, 15 percent. 
"(ii) For the 1997 crop, 25 percent. 
"(iii) For the 1998 crop, 30 percent. 
"(iv) For the 1999 crop, 35 percent. 
"(v) For the 2000 and subsequent crops, not more 
than an aggregate of 40 percent of the total poundage 
quota within the county as of January 1, 1996. 
"(C) CLARIFICATION REGARDING FALL TRANSFERS.—^The 
limitation in subparagraph (B) does not apply to 1-year 
fall transfers, which in all cases may be made to any 
farm in the same State. 
"(D) EFFECT OF TRANSFER.—^Any farm poundage quota 
transferred under this paragraph shall not result in any 
reduction in the farm poundage quota for the transferring 
farm if the transferred quota is produced or considered 
produced on the receiving farm."; and 
(B) by adding at the end the following: 
"(4) TRANSFERS IN COUNTIES WITH SMALL QUOTAS.—Not-
withstanding paragraphs (1) and (2), in the case of any county 
in a State for which the poundage quota allocated to the county 
was less than 100,000 pounds for the preceding year's crop, 
all or any part of a farm poundage quota may be transferred 
by sale or lease or otherwise from a farm in the county to 
a farm in another county in the same State.". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 931 
SEC. 156. SUGAR PROGRAM. 
7 USC 7272. 
(a) SUGARCANE.—^The Secretary shall make loans available to 
processors of domestically grown sugarcane at a rate equal to 18 
cents per pound for raw cane sugar. 
(b) SUGAR BEETS.—^The Secretary shall make loans available 
to processors of domestically grown sugar beets at a rate equal 
to 22.9 cents per pound for refined beet sugar. 
(c) REDUCTION IN LO;\N RATES.— 
(1) REDUCTION REQUIRED.—The Secretary shall reduce the 
loan rate specified in subsection (a) for domestically grown 
sugarcane and subsection (b) for domestically grown sugar beets 
if the Secretary determines that negotiated reductions in export 
subsidies and domestic subsidies provided for sugar of other 
major sugar growing, producing, and exporting countries in 
the aggregate exceed the commitments made as part of the 
Agreement on Agriculture. 
(2) EXTENT OF REDUCTION.—The Secretary shall not reduce 
the loan rate under subsection (a) or (b) below a rate that 
provides an equal measure of support to that provided by 
other major sugar gi-owing, producing, and exporting countries, 
based on an examination of both domestic and export subsidies 
subject to reduction in the Agreement on Agriculture. 
(3) ANNOUNCEMENT OF REDUCTION.—The Secretary shall 
announce any loan rate reduction to be made under this sub-
section as far in advance as is practicable. 
(4) DEFINITIONS.—In this subsection: 
(A) AGREEMENT ON AGRICULTURE.—^The term "Agree-
ment on Agriculture" means the Agreement on Agriculture 
referred to in section 101(d)(2) of the Uruguay Round 
Agreements Act (19 U.S.C. 3511(d)(2)). 
(B) MAJOR SUGAR COUNTRIES.—The term "major sugar 
growing, producing, and exporting countries" means— 
(i) the countries of the European Union; and 
(ii) the 10 foreign countries not covered by subpara-
graph (A) that the Secretary determines produce the 
greatest quantity of sugar. 
(d) TERM OF LOANS.— 
(1) IN GENERAL.—^A loan under this section during any 
fiscal year shall be made available not earlier than the begin-
ning of the fiscal year and shall mature at the earlier of— 
(A) the end of the 9-month period beginning on the 
first day of the first month after the month in which 
the loan is made; or 
(B) the end of the fiscal year in which the loan is 
made. 
(2) SUPPLEMENTAL LOANS.—In the case of a loan made 
under this section in the last 3 months of a fiscal year, the 
processor may repledge the sugar as collateral for a second 
loan in the subsequent fiscal year, except that the second 
loan shall— 
(A) be made at the loan rate in effect at the time 
the second loan is made; and 
(B) mature in 9 months less the quantity of time that 
the first loan was in effect. 
(e) LOAN TYPE; PROCESSOR ASSURANCES.— 
110 STAT. 932 
PUBLIC LAW 104-127—APR. 4, 1996 
Effective date. 
Effective date. 
(1) RECOURSE LOANS.—Subject to paragraph (2), the Sec-
retary shall carry out this section through the use of recourse 
loans. 
(2) NONRECOURSE LOANS.—During any fiscal year in which 
the tariff rate quota for imports of sugar into the United States 
is established at, or is increased to, a level in excess of 1,500,000 
short tons raw value, the Secretary shall carry out this section 
by making available nonrecourse loans. Any recourse loan pre-
viously made available by the Secretary under this section 
during the fiscal year shall be changed by the Secretary into 
a nonrecourse loan. 
(3) PROCESSOR ASSURANCES.—If the Secretary is required 
under paragraph (2) to make nonrecourse loans available dur-
ing a fiscal year or to change recourse loans into nonrecourse 
loans, the Secretary shall obtain from each processor that 
receives a loan under this section such assurances as the Sec-
retary considers adequate to ensure that the processor will 
provide payments to producers that are proportional to the 
value of the loan received by the processor for sugar beets 
and sugarcane delivered by producers served by the processor. 
The Secretary may establish appropriate minimum pajrments 
for purposes of this paragraph. 
(f) MARKETING ASSESSMENT.— 
(1) SUGARCANE.—Effective for marketings of raw cane 
sugar during the 1996 through 2003 fiscal years, the first 
processor of sugarcane shall remit to the Commodity Credit 
Corporation a nonrefundable marketing assessment in an 
amount equal to— 
(A) in the case of marketings during fiscal year 1996, 
1.1 percent of the loan rate established under subsection 
(a) per pound of raw cane sugar, processed by the processor 
from domestically produced sugarcane or sugarcane molas-
ses, that has been marketed (including the transfer or 
delivery of the sugar to a refinery for further processing 
or marketing); and 
(B) in the case of marketings during each of fiscal 
years 1997 through 2003, 1.375 percent of the loan rate 
established under subsection (a) per pound of raw cane 
sugar, processed by the processor from domestically pro-
duced sugarcane or sugarcane molasses, that has been 
marketed (including the transfer or delivery of the sugar 
to a refinery for further processing or marketing). 
(2) SUGAR BEETS.—Effective for marketings of beet sugar 
during the 1996 through 2003 fiscal years, the first processor 
of sugar beets shall remit to the Commodity Credit Corporation 
a nonrefundable marketing assessment in an amount equal 
to— 
(A) in the case of marketings during fiscal year 1996, 
1.1794 percent of the loan rate established under subsection 
(a) per pound of beet sugar, processed by the processor 
from domestically produced sugar beets or sugar beet 
molasses, that has been marketed; and 
(B) in the case of marketings during each of fiscal 
years 1997 through 2003, 1.47425 percent of the loan rate 
established under subsection (a) per pound of beet sugar, 
processed by the processor from domestically produced 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 933 
sugar beets or sugar beet molasses, that has been mar-
keted. 
(3) COLLECTION.— 
(A) TIMING.—^A marketing assessment required under 
this subsection shall be collected on a monthly basis and 
shall be remitted to the Commodity Credit Corporation 
not later than 30 days after the end of each month. Any 
cane sugar or beet sugar processed during a fiscal year 
that has not been marketed by September 30 of the year 
shall be subject to assessment on that date. The sugar 
shall not be subject to a second assessment at the time 
that it is marketed. 
(B) MANNER.—Subject to subparagraph (A), marketing 
assessments shall be collected under this subsection in 
the manner prescribed by the Secretary and shall be non-
refundable. 
(4) PENALTIES.—If any person fails to remit the assessment 
^ 
required by this subsection or fails to comply with such require-
ments for recordkeeping or otherwise as are required by the 
Secretary to carry out this subsection, the person shall be 
liable to the Secretary for a civil penalty up to an amount 
determined by multiplying— 
(A) the quantity of cane sugar or beet sugar involved 
in the violation; by 
(B) the loan rate for the applicable crop of sugarcane 
or sugar beets. 
(5) ENFORCEMENT.—^The Secretary may enforce this sub-
section in a court of the United States. 
(g) FORFEITURE PENJ^LTY.— 
(1) IN GENERAL.—^A penalty shall be assessed on the forfeit-
ure of any sugar pledged as collateral for a nonrecourse loan 
under this section. 
(2) CANE SUGAR.—^The penalty for cane sugar shall be 
1 cent per pound. 
(3) BEET SUGAR.—^The penalty for beet sugar shall bear 
the same relation to the penalty for cane sugar as the marketing 
assessment for sugar beets bears to the marketing assessment 
for sugarcane. 
(4) EFFECT OF FORFEITURE.—^Any payments owed producers 
by a processor that forfeits any sugar pledged as collateral 
for a nonrecourse loan shall be reduced in proportion to the 
loan forfeiture penalty incurred by the processor. 
(h) INFORMATION REPORTING.— 
(1) DUTY OF PROCESSORS AND REFINERS TO REPORT.—^A 
sugarcane processor, cane sugar refiner, and sugar beet proc-
essor shall furnish the Secretary, on a monthly basis, such 
information as the Secretary may require to administer sugar 
programs, including the quantity of purchases of sugarcane, 
sugar beets, and sugar, and production, importation, distribu-
tion, and stock levels of sugar. 
(2) PENALTY.—^/Vny person willfully failing or refusing to 
furnish the information, or furnishing willfully any false 
information, shall be subject to a civil penalty of not more 
than $10,000 for each such violation. 
(3) MONTHLY REPORTS.—^Taking into consideration the 
information received under paragraph (1), the Secretary shall 
110 STAT. 934 
PUBLIC LAW 104-127—APR. 4, 1996 
publish on a monthly basis composite data on production, 
imports, distribution, and stock levels of sugar. 
(i) CROPS.—This section (other than subsection (f)) shall be 
effective only for the 1996 through 2002 crops of sugar beets and 
sugarcane. 
Subtitle E—^Administration 
7 use 7281. 
SEC. 161. ADMINISTRATION. 
(a) USE OF COMMODITY CREDIT CORPORATION.—^The Secretary 
shall carry out this title through the Commodity Credit Corporation. 
(b) LIMITATION ON EXPENDITURE OF COMMODITY CREDIT COR-
PORATION FUNDS.— 
(1) GENERAL POWERS AND RESPONSIBILITIES.—Section 4 of 
the Commodity Credit Corporation Charter Act (15 U.S.C. 714b) 
is amended— 
(A) in the first sentence of subsection (g), by inserting 
before the period the following: ", except that obligations 
under all such contracts or agreements (other than 
reimbursable agreements under section 11) for equipment 
or services relating to automated data processing, informa-
tion technologies, or related items (including telecommuni-
cations equipment and computer hardware and software) 
may not exceed $170,000,000 in fiscal year 1996 and not 
more than $275,000,000 in the 6-fiscal year period begin-
ning on October 1, 1996, unless additional amounts for 
such contracts and agreements are provided in advance 
in appropriation Acts"; and 
(B) in subsection (h), by striking "shall have power 
to acquire personal property necessary to the conduct of 
its business but". 
(2) 
REIMBURSABLE 
AGREEMENTS.—Section 
11 
of 
the 
Commodity Credit Corporation Charter Act (15 U.S.C. 714i) 
is amended by adding at the end the following: "After Septem-
ber 30, 1996, the total amount of all allotments and fund 
transfers from the Corporation under this section (including 
allotments and transfers for automated data processing or 
information resource management activities) for a fiscal year 
may not exceed the total amount of the allotments and transfers 
made under this section in fiscal year 1995.". 
(3) REPORTING REQUIREMENTS.—Section 13 of the Commod-
ity Credit Corporation Charter Act (15 U.S.C. 714k) is amended 
by adding at the end the following: "In addition to the annual 
report, the Corporation shall submit to Congress on a quarterly 
basis an itemized report of all expenditures over $10,000 made 
under section 5 or 11 during the period covered by the report, 
including expenditures in the form of allotments or fund trans-
fers to other agencies and departments of the Federal Govern-
ment.". 
(c) DETERMINATIONS BY SECRETARY.—^A determination made 
by the Secretary under this title shall be final and conclusive. 
(d) REGULATIONS.—Not later than 90 days after the date of 
enactment of this title, the Secretary and the Commodity Credit 
Corporation, as appropriate, shall issue such regulations as are 
necessary to implement this title. The issuance of the regulations 
shall be made without regard to— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 935 
(1) the notice and comment provisions of section 553 of 
title 5, United States Code; 
(2) the Statement of Pohcy of the Secretary of Agriculture 
effective July 24, 1971 (36 Fed. Reg. 13804) relating to notices 
of proposed rulemaking and public participation in rulemaking; 
and 
(3) chapter 35 of title 44, United States Code (commonly 
know as the "Paperwork Reduction Act"). 
SEC. 162. ADJUSTMENTS OF LOANS. 
7 USC 7282. 
(a) ADJUSTMENT AUTHORITY.—The Secretary may make appro-
priate adjustments in the loan rates for any commodity for dif-
ferences in grade, type, quality, location, and other factors. 
(b) MANNER OF ADJUSTMENT.—The adjustments under the 
authority of this section shall, to the maximum extent practicable, 
be made in such manner that the average loan level for the commod-
ity will, on the basis of the anticipated incidence of the factors, 
be equal to the level of support determined as provided in this 
title. 
(c) ADJUSTMENT ON COUNTY BASIS.—^The Secretary may estab-
lish loan rates for a crop for producers in individual counties in 
a manner that results in the lowest such rate being 95 percent 
of the national average loan rate, except that such action shall 
not result in an increase in outlays. Adjustments under this sub-
section shall not result in an increase in the national average 
loan rate for any year. 
SEC. 163. C O M M O D I T Y CREDIT CORPORATION INTEREST RATE. 
7 USC 7283. 
Notwithstanding an}^ other provision of law, the monthly 
Commodity Credit Corporation interest rate applicable to loans 
provided for agricultural commodities by the Corporation shall be 
100 basis points greater than the rate determined under the 
applicable interest rate foraiula in effect on October 1, 1995. 
SEC. 164. PERSONAL LIABILITY OF PRODUCERS FOR DEFICIENCIES. 7 USC 7284. 
(a) IN GENERAL.—Except as provided in subsection (b), no pro-
ducer shall be personally liable for any deficiency arising from 
the sale of the collateral securing any nonrecourse loan made under 
this title unless the loan was obtained through a fraudulent rep-
resentation by the producer. 
(b) LIMITATIONS.—Subsection (a) shall not prevent the Commod-
ity Credit Corporation or the Secretary from requiring a producer 
to assume liability for— 
(1) a deficiency in the grade, quality, or quantity of a 
commodity stored on a farm or delivered by the producer; 
(2) a failure to properly care for and preserve a commodity; 
or 
(3) a failure or refusal to deliver a commodity in accordance 
with a program established under this title. 
(c) ACQUISITION OF COLLATERAL.—In the case of a nonrecourse 
loan made under this title or the Commodity Credit Corporation 
Charter Act (15 U.S.C. 714 et seq.), if the Commodity Credit Cor-
poration acquires title to the unredeemed collateral, the Corporation 
shall be under no obligation to pay for any market value that 
the collateral may have in excess of the loan indebtedness. 
(d) SUGARCANE AND SUGAR BEETS.—^A security interest obtained 
by the Commodity Credit Corporation as a result of the execution 
of a security agreement by the processor of sugarcane or sugar 
110 STAT. 936 
PUBLIC LAW 104-127—APR. 4, 1996 
beets shall be superior to all statutory and common law liens 
on raw cane sugar and refined beet sugar in favor of the producers 
of sugarcane and sugar beets and all prior recorded and unrecorded 
liens on the crops of sugarcane and sugar beets from which the 
sugar was derived. 
7 use 7285. 
SEC. 165. COMMODITY CREDIT CORPORATION SALES PRICE RESTRIC-
TIONS. 
(a) GENERAL SALES AUTHORITY.—^The Commodity Credit Cor-
poration may sell any commodity owned or controlled by the Cor-
poration at any price that the Secretary determines will maximize 
returns to the Corporation. 
(b) NONAPPLICATION OF SALES PRICE RESTRICTIONS.—Sub-
section (a) shall not apply to— 
(1) a sale for a new or byproduct use; 
(2) a sale of peanuts or oilseeds for the extraction of oil; 
(3) a sale for seed or feed if the sale will not substantially 
impair any loan program; 
(4) a sale of a commodity that has substantially deterio-
rated in quality or as to which there is a danger of loss or 
waste through deterioration or spoilage; 
(5) a sale for the purpose of establishing a claim arising 
out of a contract or against a person who has committed fraud, 
misrepresentation, or other wrongful act with respect to the 
commodity; 
(6) a sale for export, as determined by the Corporation; 
and 
(7) a sale for other than a primary use. 
(c) PRESIDENTIAL DISASTER AREAS.— 
(1) IN GENERAL.—Notwithstanding subsection (a), on such 
terms and conditions as the Secretary may consider in the 
public interest, the Corporation may make available any 
commodity or product owned or controlled by the Corporation 
for use in relieving distress— 
(A) in any area in the United States (including the 
Virgin Islands) declared by the President to be an acute 
distress area because of unemployment or other economic 
cause, if the President finds that the use will not displace 
or interfere with normal marketing of agricultural commod-
ities; and 
(B) in connection with any major disaster determined 
by the President to warrant assistance by the Federgd 
Government under the Robert T. Stafford Disaster Relief 
and Emergency Assistance Act (42 U.S.C. 5121 et seq.). 
(2) COSTS.—Except on a reimbursable basis, the Corpora-
tion shall not bear any costs in connection with making a 
commodity available under paragraph (1) beyond the cost of 
the commodity to the Corporation incurred in— 
(A) the storage of the commodity; and 
(B) the handling and transportation costs in making 
delivery of the commodity to designated agencies at 1 or 
more central locations in each State or other area. 
(d) EFFICIENT OPERATIONS.—Subsection (a) shall not apply to 
the sale of a commodity the disposition of which is desirable in 
the interest of the effective and efficient conduct of the operations 
of the Corporation because of the small quantity of the commodity 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 937 
involved, or because of the age, location, or questionable continued 
storability of the commodity. 
Subtitle F—Permanent Price Support 
Authority 
SEC. 171. SUSPENSION AND REPEAL OF PERMANENT PRICE SUPPORT 
7 USC 7301. 
AUTHORITY. 
(a) AGRICULTURAL ADJUSTMENT ACT OF 1938.— 
(1) SUSPENSIONS.—The following provisions of the Agricul-
tural Adjustment Act of 1938 shall not be applicable to the 
1996 through 2002 crops of loan commodities, peanuts, and 
sugar and shall not be applicable to milk during the period 
beginning on the date of enactment of this title and ending 
on December 31, 2002: 
(A) Parts II through V of subtitle B of title III (7 
U.S.C. 1326-1351). 
(B) Subsections (a) through (j) of section 358 (7 U.S.C. 
1358). 
(C) Subsections (a) through (h) of section 358a (7 U.S.C. 
1358a). 
(D) Subsections (a), (b), (d), and (e) of section 358d 
(7 U.S.C. 1359). 
(E) Part VII of subtitle B of title III (7 U.S.C. 1359aa-
1359JJ). 
(F) In the case of peanuts, part I of subtitle C of 
title III (7 U.S.C. 1361-1368). 
(G) In the case of upland cotton, section 377 (7 U.S.C. 
1377). 
(H) Subtitle D of title III (7 U.S.C. 1379a-1379J). 
(I) Title IV (7 U.S.C. 1401-1407). 
(2) REPORTS AND RECORDS.—Effective only for the 1996 Effective date, 
through 2002 crops of peanuts, the first sentence of section 
373(a) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 
1373(a)) is amended by inserting before "all brokers and dealers 
in peanuts" the following: "all producers engaged in the produc-
tion of peanuts,". 
(b) AGRICULTURAL ACT OF 1949.— 
(1) SUSPENSIONS.—^The following provisions of the Agricul-
tural Act of 1949 shall not be applicable to the 1996 through 
2002 crops of loan commodities, peanuts, and sugar and shall 
not be applicable to milk during the period beginning on the 
date of enactment of this title and ending on December 31, 
2002: 
(A) Section 101 (7 U.S.C. 1441). 
(B) Section 103(a) (7 U.S.C. 1444(a)). 
(C) Section 105 (7 U.S.C. 1444b). 
(D) Section 107 (7 U.S.C. 1445a). 
(E) Section 110 (7 U.S.C. 1445e). 
(F) Section 112 (7 U.S.C. 1445g). 
(G) Section 115 (7 U.S.C. 1445k). 
(H) Section 201 (7 U.S.C. 1446). 
(I) Title III (7 U.S.C. 1447-1449). 
(J) Title IV (7 U.S.C. 1421-1433d), other than sections 
404, 412, and 416 (7 U.S.C. 1424, 1429, and 1431). 
(K) Title V (7 U.S.C. 1461-1469). 
29-194 O - 96 - 31 : QL 3 Part 1 
110 STAT. 938 
PUBLIC LAW 104-127—APR. 4, 1996 
(L) Title VI (7 U.S.C. 1471-147Ij). 
(2) REPEALS.—The following provisions of the Agricultural 
Act of 1949 are repealed: 
(A) Section lOlB (7 U.S.C. 1441-2). 
(B) Section 103B (7 U.S.C. 1444-2). 
(C) Section 105B (7 U.S.C. 14440. 
7 use I445b-3a. 
(D) Section 107B (7 U.S.C. 1445-3a). 
(E) Section 108B (7 U.S.C. 1445c-3). 
(F) Section 113 (7 U.S.C. 1445h). 
(G) Subsections (b) and (c) of section 114 (7 U.S.C. 
1445J). 
(H) Sections 205, 206, and 207 (7 U.S.C. 1446f, 1446g, 
and 1446h). 
(I) Sections 406 and 427 (7 U.S.C. 1426 and 1433f). 
(3) POTENTIAL PRICE SUPPORT FOR RICE.—Section 101 of 
the Agricultural Act of 1949 (7 U.S.C. 1441), as suspended 
by paragraph (1), is amended by adding after subsection (d) 
the following: 
"(e) RICE.—The Secretary shall make available to producers 
of each crop of rice on a farm price support at a level that is 
not less than 50 percent, or more than 90 percent of the parity 
price for rice as the Secretary determines will not result in increas-
ing stocks of rice to the Commodity Credit Corporation.". 
(c) SUSPENSION OF CERTAIN QUOTA PROVISIONS.—The joint reso-
lution entitled "A joint resolution relating to corn and wheat market-
ing quotas under the Agricultural Adjustment Act of 1938, as 
amended", approved May 26, 1941 (7 U.S.C. 1330 and 1340), shall 
not be applicable to the crops of wheat planted for harvest in 
the calendar years 1996 through 2002. 
7 use 7302. 
SEC. 172. EFFECT OF AMENDMENTS. 
(a) EFFECT ON PRIOR CROPS.—Except as otherwise specifically 
provided in this title and notwithstanding any other provision of 
law, this title and the amendments made by this title shall not 
affect the authority of the Secretary to carry out a price support 
or production adjustment program for any of the 1991 through 
1995 crops of an agricultural commodity established under a provi-
sion of law in effect immediately before the date of enactment 
of this title. 
(b) LIABILITY.—^A provision of this title or an amendment made 
by this title shall not affect the liability of any person under 
any provision of law as in effect before the date of enactment 
of this title. 
Subtitle G—Commission on 21st Century 
Production Agriculture 
7 use 7311. 
SEC. 181. ESTABLISHMENT. 
There is established a commission to be known as the "Commis-
sion on 21st Century Production Agriculture" (in this subtitle 
referred to as the "Commission"). 
7 use 7312. 
SEC. 182. COMPOSITION. 
(a) MEMBERSHIP AND APPOINTMENT.—The Commission shall 
be composed of 11 members, appointed as follows: 
President. 
(1) Three members shall be appointed by the President. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 939 
(2) Four members shall be appointed by the Chairman 
of the Committee on Agriculture of the House of Representa-
tives in consultation with the ranking minority member of 
the Committee. 
(3) Four members shall be appointed by the Chairman 
of the Committee on Agriculture, Nutrition, and Forestry of 
the Senate in consultation with the ranking minority member 
of the Committee. 
(b) QUALIFICATIONS.—^At least 1 of the members appointed 
under each of paragraphs (1), (2), and (3) of subsection (a) shall 
be an individual who is primarily involved in production agriculture. 
All other members of the Commission shall be appointed from 
among individuals having knowledge and experience in agricultural 
production, marketing, finance, or trade. 
(c) TERM OF MEMBERS; VACANCIES.—^A member of the Commis-
sion shall be appointed for the life of the Commission. A vacancy 
on the Commission shall not affect its powers, but shall be filled 
in the same manner as the original appointment was made. 
(d) TIME FOR APPOINTMENT; FIRST MEETING.—The members 
of the Commission shall be appointed not later than October 1, 
1997. The Commission shall convene its first meeting to carry 
out its duties under this subtitle 30 days after 6 members of 
the Commission have been appointed. 
(e) CHAIRPERSON.—The chairperson of the Commission shall 
be designated jointly by the Chairman of the Committee on Agri-
culture of the House of Representatives and the Chairman of the 
Committee on Agriculture, Nutrition, and Forestry of the Senate 
from among the members of the Commission. 
SEC. 
183. COMPREHENSIVE REVIEW OF PAST AND FUTURE OF 
7 USC 7313. 
PRODUCTION AGRICULTURE. 
(a) INITIAL REVIEW.—The Commission shall conduct a com-
prehensive review of changes in the condition of production agri-
culture in the United States since the date of enactment of this 
title and the extent to which the changes are the result of this 
title and the amendments made by this title. The review shall 
include the following: 
(1) An assessment of the initial success of production flexi-
bility contracts in supporting the economic viability of farming 
in the United States. 
(2) An assessment of economic risks to farms delineated 
by size of farm operation (such as small, medium, or large 
farms) and region of production. 
(3) An assessment of the food security situation in the 
United States in the areas of trade, consumer prices, inter-
national competitiveness of United States production agri-
culture, food supplies, and humanitarian relief. 
(4) An assessment of the changes in farmland values and 
agricultural producer incomes since the date of enactment of 
this title. 
(5) An assessment of the extent to which regulatory relief 
for agricultural producers has been enacted and implemented, 
including the application of cost/benefit principles in the issu-
ance of agricultural regulations. 
(6) An assessment of the extent to which tax relief for 
agricultural producers has been enacted in the form of capital 
110 STAT. 940 
PUBLIC LAW 104-127—APR. 4, 1996 
gains tax reductions, estate tax exemptions, and mechanisms 
to average tax loads over high- and low-income years. 
(7) An assessment of the effect of any Federal Government 
interference in agricultural export markets, such as the imposi-
tion of trade embargoes, and the degree of implementation 
and success of international trade agreements and United 
States export programs. 
(8) An assessment of the likely effect of the sale, lease, 
or transfer of farm poundage quota for peanuts across State 
lines. 
(b) SUBSEQUENT REVIEW.—The Commission shall conduct a 
comprehensive review of the future of production agriculture in 
the United States and the appropriate role of the Federal Govern-
ment in support of production agriculture. The review shall include 
the following: 
(1) An assessment of changes in the condition of production 
agriculture in the United States since the initial review con-
ducted under subsection (a). 
(2) Identification of the appropriate future relationship of 
the Federal Government with production agriculture after 2002. 
(3) An assessment of the personnel and infrastructure 
requirements of the Department of Agriculture necessary to 
support the future relationship of the Federal Government 
with production agriculture. 
(4) An assessment of economic risks to farms delineated 
by size of farm operation (such as small, medium, or large 
farms) and region of production. 
(c) RECOMMENDATIONS.—In carrying out the subsequent review 
under subsection (b), the Commission shall develop specific rec-
ommendations for legislation to achieve the appropriate future rela-
tionship of the Federal Government with production agriculture 
identified under subsection (a)(2). 
7 use 7314. 
SEC. 184. REPORTS. 
(a) REPORT ON INITIAL REVIEW.—Not later than June 1, 1998, 
the Commission shall submit to the President, the Committee on 
Agriculture of the House of Representatives, and the Committee 
on Agriculture, Nutrition, and Forestry of the Senate a report 
containing the results of the initial review conducted under section 
183(a). 
(b) REPORT ON SUBSEQUENT REVIEW.—Not later than January 
1, 2001, the Commission shall submit to the President and the 
congressional committees specified in subsection (a) a report 
containing the results of the subsequent review conducted under 
section 183(b). 
7 use 7315. 
SEC. 185. POWERS. 
(a) HEARINGS.—The Commission may, for the purpose of carry-
ing out this subtitle, conduct such hearings, sit and act at such 
times, take such testimony, and receive such evidence, as the 
Commission considers appropriate. 
(b) ASSISTANCE FROM OTHER AGENCIES.—The Commission may 
secure directly from any department or agency of the Federal 
Government such information as may be necessary for the Commis-
sion to carry out its duties under this subtitle. On the request 
of the chairperson of the Commission, the head of the department 
or agency shall, to the extent permitted by law, furnish such 
information to the Commission. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 941 
(c) MAIL.—The Commission may use the United States mails 
in the same manner and under the same conditions as the depart-
ments and agencies of the Federal Government. 
(d) ASSISTANCE FROM SECRETARY.—The Secretary shall provide 
to the Commission appropriate office space and such reasonable 
administrative and support services as the Commission may 
request. 
SEC. 186. COMMISSION PROCEDURES. 
7 USC 7316. 
(a) MEETINGS.—^The Commission shall meet on a regular basis 
(as determined by the chairperson) and at the call of the chairperson 
or a majority of its members. 
(b) QUORUM.—A majority of the members of the Commission 
shall constitute a quorum for the transaction of business. 
SEC. 187. PERSONNEL MATTERS. 
7 USC 7317. 
(a) COMPENSATION.—Each member of the Commission shall 
serve without compensation, but shall be allowed travel expenses 
including per diem in lieu of subsistence, as authorized by section 
5703 of title 5, United States Code, when engaged in the perform-
ance of Commission duties. 
(b) STAFF.— 
(1) APPOINTMENT.—The Commission shall appoint a staff 
director, who shall be paid at a rate not to exceed the maximum 
rate of basic pay under section 5376 of title 5, United States 
Code, and such professional and clerical personnel as may 
be reasonable and necessary to enable the Commission to carry 
out its duties under this subtitle without regard to the provi-
sions of title 5, United States Code, governing appointments 
in the competitive service, and without regard to the provisions 
of chapter 51 and subchapter III of chapter 53 of such title, 
or any other provision of law, relating to the number, classifica-
tion, and General Schedule rates. 
(2) LIMITATION ON COMPENSATION.—No employee appointed 
under this subsection (other than the staff director) may be 
compensated at a rate to exceed the maximum rate applicable 
to level GS-15 of the General Schedule. 
(c) DETAILED PERSONNEL.—On the request of the chairperson 
of the Commission, the head of any department or agency of the 
Federal Government is authorized to detail, without reimbursement, 
any personnel of the department or agency to the Commission 
to assist the Commission in carrying out its duties under this 
section. The detail of any individual may not result in the interrup-
tion or loss of civil service status or other privilege of the individual. 
SEC. 188. TERMINATION OF COMMISSION. 
7 USC 7318. 
The Commission shall terminate on submission of the final 
report required by section 184. 
Subtitle H—Miscellaneous Commodity 
Provisions 
SEC. 191. OPTIONS PILOT PROGRAM. 
7 USC 7331. 
(a) PILOT PROGRAMS AUTHORIZED.—Until December 31, 2002, 
the Secretary of Agriculture may conduct a pilot program for 1 
or more agricultural commodities supported under this title to 
110 STAT. 942 
PUBLIC LAW 104-127—APR. 4, 1996 
ascertain whether futures and options contracts can provide produc-
ers with reasonable protection from the financial risks of fluctua-
tions in price, yield, and income inherent in the production and 
marketing of the commodities. The pilot program shall be an alter-
native to other related programs of the Department of Agriculture. 
(b) DISTRIBUTION OF PILOT PROGRAM.—For each agricultural 
commodity included in the pilot program, the Secretary may operate 
the pilot program in not more than 100 counties, except that not 
more than 6 of the counties may be located in any 1 State. The 
pilot program for a commodity shall not be operated in any county 
for more than 3 of the 1996 through 2002 calendar years. 
(c) ELIGIBLE PARTICIPANTS.—In operating the pilot program, 
the Secretary may enter into contract with a producer who— 
(1) is eligible for a production flexibility contract, a market-
ing assistance loan, or other assistance under this title; 
(2) volunteers to participate in the pilot program; 
(3) operates a farm located in a county selected for the 
pilot program; and 
(4) meets such other eligibility requirements as the Sec-
retary may establish. 
(d) NOTICE TO PRODUCERS.—^The Secretary shall provide notice 
to each producer participating in the pilot program that— 
(1) the participation of the producer is voluntary; and 
(2) neither the United States, the Commodity Credit Cor-
poration, the Federal Crop Insurance Corporation, the Depart-
ment of Agriculture, nor any other Federal agency is authorized 
to guarantee that participants in the pilot program will be 
better or worse off financially as a result of participation in 
the pilot program than the producer would have been if the 
producer had not participated in the pilot program. 
(e) CONTRACTS.—^The Secretary shall set forth in each contract 
under the pilot program the terms and conditions for participation 
in the pilot program and the notice required by subsection (d). 
(f) ELIGIBLE MARKETS.—Trades for futures and options con-
tracts under the pilot program shall be carried out on commodity 
futures and options markets designated as contract markets under 
the Commodity Exchange Act (7 U.S.C. 1 et seq.). 
(g) RECORDKEEPING.—^A producer participating in the pilot pro-
gram shall compile, maintain, and submit (or authorize the compila-
tion, maintenance, and submission) of such documentation as the 
regulations governing the pilot program require. 
(h) USE OF COMMODITY CREDIT CORPORATION.—The Secretary 
shall fund and operate the pilot program through the Commodity 
Credit Corporation. To the maximum extent practicable, the Sec-
retary shall operate the pilot program in a budget neutral manner. 
(i) CONFORMING REPEAL.—^The Options Pilot Program Act of 
1990 (subtitle E of title XI of Public Law 101-624; 7 U.S.C. 1421 
note) is repealed. 
7 use 7332. 
SEC. 192. RISK MANAGEMENT EDUCATION. 
In consultation with the Commodity Futures Trading Commis-
sion, the Secretary shall provide such education in management 
of the financial risks inherent in the production and marketing 
of agricultural commodities as the Secretary considers appropriate. 
As part of such educational activities, the Secretary may develop 
and implement programs to facilitate the participation of agricul-
tural producers in commodity futures trading programs, forward 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 943 
contracting options, and insurance protection programs by assisting 
and training producers in the usage of such programs. In 
implementing this authority, the Secretary may use existing 
research and extension authorities and resources of the Department 
of Agriculture. 
SEC. 193. CROP INSURANCE. 
(a) CATASTROPHIC RISK PROTECTION.— 
(1) SINGLE DELIVERY.—Section 508(b)(4) of the Federal Crop 
Insurance Act (7 U.S.C. 1508(b)(4)) is amended by adding at 
the end the following: 
"(C) DELIVERY OF COVERAGE.— 
"(i) 
IN 
GENERAL.—In 
full 
consultation 
with 
approved insurance providers, the Secretary may con-
tinue to offer catastrophic risk protection in a State 
(or a portion of a State) through local offices of the 
Department if the Secretary determines that there is 
an insufficient number of approved insurance providers 
operating in the State or portion of the State to ade-
quately provide catastrophic risk protection coverage 
to producers. 
"(ii) COVERAGE BY APPROVED INSURANCE PROVID-
ERS.—^To the extent that catastrophic risk protection 
coverage by approved insurance providers is suffi-
ciently available in a State (or a portion of a State) 
as determined by the Secretary, only approved insur-
ance providers may provide the coverage in the State 
or portion of the State. 
"(iii) TIMING OF DETERMINATIONS.—Not later than 
90 days aftcjr the date of enactment of this subpara-
graph, the Secretary shall announce the results of the 
determinations under clause (i) for policies for the 1997 
crop year. For subsequent crop years, the Secretary 
shall make the announcement not later than April 
30 of the year preceding the year in which the crop 
will be produced, or at such other times during the 
year as the Secretary finds practicable in consultation 
with affected crop insurance providers for those States 
(or portions of States) in which catastrophic coverage 
remains available through local offices of the Depart-
ment. 
"(iv) CURRENT POLICIES.—This clause shall take 
effect beginning with the 1997 crop year. Subject to 
clause (ii) all catastrophic risk protection policies writ-
ten by local offices of the Department shall be trans-
ferred to the approved insurance provider for perform-
ance of all sales, service, and loss adjustment functions. 
Any fees in connection with such policies that are 
not yet collected at the time of the transfer shall be 
payable to the approved insurance providers assuming 
the policies. The transfer process for policies for the 
1997 crop year with sales closing dates before January 
1, 1997, shall begin at the time of the Secretary's 
announcement under clause (iii) and be completed by 
the sales closing date for the crop and county. The 
transfer process for all subsequent policies (including 
policies for the 1998 and subsequent crop years) shall 
Announcement. 
Effective date. 
110 STAT. 944 
PUBLIC LAW 104-127—APR. 4, 1996 
Effective date. 
7 use 1508 note. 
7 use 1508 note. 
begin at a date that permits the process to be com-
pleted not later than 45 days before the sales closing 
date.". 
(2) WAIVER OF MANDATORY LINKAGE.—Section 508(b)(7) of 
the Federal Crop Insurance Act (7 U.S.C. 1508(b)(7)) is amend-
ed by striking subparagraph (A) and inserting the following: 
"(A) IN GENERAL.—Effective for the spring-planted 1996 
and subsequent crops (and fall-planted 1996 crops at the 
option of the Secretary), to be eligible for any payment 
or loan under the Agricultural Market Transition Act, for 
the conservation reserve program, or for any benefit 
described in section 371 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 2008f), a person shall— 
"(i) obtain at least the catastrophic level of insur-
ance for each crop of economic significance in which 
the person has an interest; or 
"(ii) provide a written waiver to the Secretary that 
waives any eligibility for emergency crop loss assist-
ance in connection with the crop.". 
(3) SPECIAL RULE FOR I996.— 
(A) EFFECTIVE PERIOD.—This paragraph shall apply 
only to the 1996 crop year. 
(B) AVAILABILITY.—During a period of not less than 
2 weeks, but not more than 4 weeks, beginning on the 
date of enactment of this title, the Secretary shall provide 
producers with an opportunity to obtain catastrophic risk 
protection insurance under section 508(b) of the Federal 
Crop Insurance Act (7 U.S.C. 1508(b)) for a spring-planted 
crop, and limited additional coverage for malting barley 
under the Malting Barley Price and Quality Endorsement. 
The Federal Crop Insurance Corporation may attach such 
limitations and restrictions on obtaining insurance during 
this period as the Corporation considers necessary to main-
tain the actuarial soundness of the crop insurance program. 
(C) ATTACHMENT.—Insurance coverage under any pol-
icy obtained under this paragraph during the extended 
sales period shall not attach until 10 days after the applica-
tion. 
(D) CANCELLATION.—During the extended period, a 
producer may cancel a catastrophic risk protection policy 
if— 
(i) the policy is a continuation of a policy that 
was obtained for a previous crop year; and 
(ii) the cancellation request is made before the 
acreage reporting date for the policy for the 1996 crop 
year. 
(b) CROP INSURANCE PILOT PROJECT.— 
(1) COVERAGE.—The Secretary of Agriculture shall develop 
and administer a pilot project for crop insurance coverage that 
indemnifies crop losses due to a natural disaster such as insect 
infestation or disease. 
(2) ACTUARIAL SOUNDNESS.—^A pilot project under this para-
graph shall be actuarially sound, as determined by the Sec-
retary and administered at no net cost. 
(3) DURATION.—A pilot project under this paragraph shall 
be of two years' duration. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 945 
(c) CROP INSURANCE FOR NURSERY CROPS.—Section 508(a)(6) 
of the Federal Crop Insurance Act (7 U.S.C. 1508(a)(6)) is amended 
by adding at the end the following: 
"(D) ADDITION OF NURSERY CROPS.—Not later than 2 
years after the date of enactment of this subparagraph, 
the Corporation shall conduct a study and limited pilot 
program on the feasibility of insuring nursery crops.". 
(d) MARKETING WINDOWS.—Section 508(j) of the Federal Crop 
Insurance Act (7 U.S.C. 1508(j)) is amended by adding at the 
end the following: 
"(4) MARKETING WINDOWS.—The Corporation shall consider 
marketing windows in determining whether it is feasible to 
require planting during a crop year.". 
(e) FUNDING.— 
(1) MANDATORY EXPENSES.—Section 516(a)(2) of the Federal 
Crop Insurance Act (7 U.S.C. 1516(a)(2)) is amended— 
(A) by inserting "and" at the end of subparagraph 
(A); 
(B) by striking "; and" at the end of subparagraph 
(B) and inserting a period; and 
(C) by striking subparagraph (C). 
(2) FUNDING OF SALES COMMISSIONS.—Section 516(b) of the 
Federal Crop Insursmce Act (7 U.S.C. 1516(b)) is amended— 
(A) in paragraph (1)— 
(i) by striking "(A) IN GENERAL" and all that follows 
through "subparagraph (B), in" and inserting "In"; and 
(ii) by striking subparagraph (B); and 
(B) in paragraph (2)(B), by striking "subject to para-
graph (1)(B),". 
(3) OTHER EXPENSES.—Section 516(b)(2)(A) of the Federal 
Crop Insurance Act (7 U.S.C. 1516(b)(2)(A)) is amended by 
-
: -
striking ", noninsured assistance benefits,". 
(f) LIMITATION ON MULTIPLE BENEFITS FOR SAME LOSS.—Sec-
tion 508 of the Federal Crop Insurance Act (7 U.S.C. 1508) is 
. -, 
amended by adding at the end the following: 
"(n) LIMITATION ON MULTIPLE BENEFITS FOR SAME LOSS.— 
> -
If a producer who is eligible to receive benefits under catastrophic 
risk protection under subsection (b) is also eligible to receive assist-
ance for the same loss under any other program 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 
subsection (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.". 
SEC. 194. ESTABLISHMENT OF OFFICE OF RISK MANAGEMENT. 
(a) ESTABLISHMENT.—The Department of Agriculture Reorga-
nization Act of 1994 is amended by inserting after section 226 
(7 U.S.C. 6932) the following new section: 
"SEC. 226A. OFFICE OF RISK MANAGEMENT. 
7 USC 6933. 
"(a) ESTABLISHMENT.—Subject to subsection (e), the Secretary 
.. 
shall establish and maintain in the Department an independent 
. 
Office of Risk Management. 
110 STAT. 946 
PUBLIC LAW 104-127—APR. 4, 1996 
"(b) FUNCTIONS OF THE OFFICE OF RISK MANAGEMENT.—The 
Office of Risk Management shall have jurisdiction over the following 
functions: 
"(1) Supervision of the Federal Crop Insurance Corporation. 
"(2) Administration and oversight of all aspects, including 
delivery through local offices of the Department, of all programs 
authorized under the Federal Crop Insurance Act (7 U.S.C. 
1501 et seq.). 
"(3) Any pilot or other programs involving revenue insur-
ance, risk management savings accounts, or the use of the 
futures market to manage risk and support farm income that 
may be established under the Federal Crop Insurance Act or 
other law. 
"(4) Such other functions as the Secretary considers appro-
priate. 
"(c) ADMINISTRATOR.— 
"(1) APPOINTMENT.—The Office of Risk Management shall 
be headed by an Administrator who shall be appointed by 
the Secretary. 
"(2) MANAGER.—The Administrator of the Office of Risk 
Management shall also serve as Manager of the Federal Crop 
Insurance Corporation. 
"(d) RESOURCES.— 
"(1) FUNCTIONAL COORDINATION.—Certain functions of the 
Office of Risk Management, such as human resources, public 
affairs, and legislative affairs, may be provided by a consolida-
tion of such functions under the Under Secretary of Agriculture 
for Farm and Foreign Agricultural Services. 
"(2) MINIMUM PROVISIONS.—Notwithstanding paragraph (1) 
or any other provision of law or order of the Secretary, the 
Secretary shall provide the Office of Risk Management with 
human and capital resources sufficient for the Office to carry 
out its functions in a timely and efficient manner.". 
(b) FISCAL YEAR 1996 FUNDING.—From funds appropriated for 
the salaries and expenses of the Consolidated Farm Service Agency 
in the Agriculture, Rural Development, Food and Drug Administra-
tion, and Related Agencies Appropriations Act, 1996 (Public Law 
104-37), the Secretary of Agriculture may use such sums as nec-
essary for the salaries and expenses of the Office of Risk Manage-
ment established under subsection (a). 
(c) CONFORMING AMENDMENT.—Section 226(b) of the Act (7 
U.S.C. 6932(b)) is amended by striking paragraph (2). 
SEC. 195. REVENUE INSURANCE. 
Section 508(h) of the Federal Crop Insurance Act (7 U.S.C. 
1508(h)) is amended by adding at the end the following: 
"(9) REVENUE INSURANCE PILOT PROGRAM.— 
"(A) IN GENERAL.—Not later than December 31, 1996, 
the Secretary shall carry out a pilot program in a limited 
number of counties, as determined by the Secretary, for 
crop years 1997, 1998, 1999, and 2000, under which a 
producer of wheat, feed grains, soybeans, or such other 
commodity as the Secretary considers appropriate may elect 
to receive insurance against loss of revenue, as determined 
by the Secretary. 
"(B) ADMINISTRATION.—Revenue insurance under this 
paragraph shall— 
PUBLIC L.\W 104-127—APR. 4, 1996 
110 STAT. 947 
"(i) be offered through reinsurance arrangements 
with private insurance companies; 
"(ii) offer at least a minimum level of coverage 
that is an alternative to catastrophic crop insurance; 
"(iii) be actuarially sound; and 
"(iv) require the payment 
of premiums 
and 
administrative fees by an insured producer.". 
SEC. 196. ADMINISTRATION AND OPERATION OF NONINSURED CROP 7 USC 7333. 
ASSISTANCE PROGRAM. 
(a) OPERATION AND ADMINISTRATION OF PROGRAM.— 
(1) IN GENERAL.—In the case of an eligible crop described 
in paragraph (2), the Secretary of Agriculture shall operate 
a noninsured crop disaster assistance program to provide cov-
erage equivalent to the catastrophic risk protection otherwise 
available under section 508(b) of the Federal Crop Insurance 
Act (7 U.S.C. 1508(b)). The Secretary shall carry out this section 
through the Consolidated Farm Service Agency (in this section 
referred to as the "Agency"). 
(2) ELIGIBLE CROPS.— 
(A) IN GENERAL.—In this section, the term "eligible 
crop" means each commercial crop or other agricultural 
commodity (except livestock)— 
(i) for which catastrophic risk protection under 
section 508(b) of the Federal Crop Insurance Act (7 
U.S.C. 1508(b)) is not available; and 
(ii) that is produced for food or fiber. 
(B) CROPS SPECIFICALLY INCLUDED.—^The term "eligible 
crop" shall include floricultural, ornamental nursery, and 
Christmas tree crops, turfgrass sod, seed crops, aquaculture 
(including ornamental fish), and industrial crops. 
(3) CAUSE OF LOSS.—To qualify for assistance 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 DISASTER ASSIST-
ANCE.— 
(1) TIMELY APPLICATION.—^To be eligible for assistance 
under this section, a producer shall submit an application for 
noninsured crop disaster assistance at a local office of the 
Department. The application shall be in such form, contain 
such information, and be submitted at such time as the Sec-
retary may require. 
(2) RECORDS.—^A producer shall provide records, as required 
by the Secretary, of crop acreage, acreage jdelds, and produc-
tion. 
(3) ACREAGE REPORTS.—^A producer shall provide reports 
on acreage planted or prevented from being planted, as required 
by the Secretary, by the designated acreage reporting date 
for the crop and location as established by the Secretary. 
(c) Loss REQUIREMENTS.— 
(1) REQUIRED AREA LOSS.—^A producer of an eligible crop 
shall not receive noninsured crop disaster 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 
Secretary. 
110 STAT. 948 
PUBLIC LAW 104-127—APR. 4, 1996 
(2) PREVENTED PLANTING.—Subject to paragraph (1), 
the 
Secretary shall make a prevented planting noninsured crop 
disaster assistance payment 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. 
(3) REDUCED YIELDS.—Subject to paragraph (1), the Sec-
retary 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 deter-
mined by the Secretary, less than 50 percent of the expected 
individual yield for the crop, as determined by the Secretary, 
factored for the interest of the producer for the crop. 
(d) PAYMENT.—The Secretary shall make available 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 estab-
lished yield for the crop; by 
(2)(A) in the case of each of the 1996 through 1998 crop 
years, 60 percent of the average market price for the crop 
(or any comparable coverage determined by the Secretary); 
or 
(B) in the case of each of the 1999 and subsequent crop 
years, 55 percent of the average market price for the crop 
(or any comparable coverage determined by the Secretary); 
by 
(3) a payment rate for the type of crop (as determined 
by the Secretary) that— 
(A) in the case of a crop that is produced with a 
significant and variable harvesting expense, 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 produced with 
a significant and variable harvesting expense, as deter-
mined by the Secretary. 
(e) YIELD DETERMINATIONS.— 
(1) ESTABLISHMENT.—^The Secretary shall establish farm 
yields for purposes of providing noninsured crop disaster assist-
ance under this section. 
(2) ACTUAL PRODUCTION HISTORY.—The Secretary shall 
determine yield coverage using the actual 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 shall be equal 
to the average of the actual production history of the producer 
during the period considered. 
(3) ASSIGNMENT OF YIELD.—If a producer does not submit 
adequate documentation of production history to determine a 
crop yield under paragraph (2), the Secretary shall assign to 
the producer a yield equal to not less than 65 percent of 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 949 
the transitional yield of the producer (adjusted to reflect actual 
production reflected in the records acceptable to the Secretary 
for continuous years), as specified in regulations issued by 
the Secretary based on production history requirements. 
(4) PROHIBITION ON ASSIGNED YIELDS IN CERTAIN COUN-
TIES.— 
(A) IN GENERAL.— 
(i) DOCUMENTATION.—If sufficient data are avail-
able to demonstrate that the acreage of a crop in 
a county for the crop year has increased by more 
than 100 percent 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 increased significantly 
from the previous crop years, a producer must provide 
such detailed documentation of production costs, acres 
planted, and yield for the crop year for which benefits 
are being claimed as is required by the Secretary. 
If the Secretary determines that the documentation 
provided is not sufficient, the Secretary may require 
documenting proof that the crop, had the crop been 
harvested, could have been marketed at a reasonable 
price. 
(ii) PROHIBITION.—Except as provided in subpara-
graph (B), a producer who produces a crop on a farm 
located in a county described in clause (i) may not 
obtain an assigned yield. 
(B) EXCEPTION.—^A crop or a producer shall not be 
subject to this subsection if— 
(i) the planted acreage of the producer 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 recommend an exemption from the 
requirement to the Administrator of the Agency; and 
(II) the Administrator approves the recommenda-
tion. 
(5) LIMITATION ON RECEIPT OF SUBSEQUENT ASSIGNED 
YIELD.—^A producer who receives an assigned yield for the cur-
rent year of a natural disaster 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 production records 
of the previous 1 or more years (as applicable) are provided 
to the local office. 
(6) YIELD VARIATIONS DUE TO DIFFERENT FARMING PRAC-
TICES.—The Secretary shall ensure that noninsured crop disas-
ter assistance accurately reflects significant yield variations 
due to different fanning practices, such as between irrigated 
and nonirrigated acreage. 
(f) CONTRACT PAYMENTS.—^A producer who has received a 
guaranteed payment for production, as opposed to delivery, of a 
crop pursuant to a contract shall have the production of the pro-
ducer adjusted upward by the amount of the production equal 
to the amount of the contract payment received. 
(g) USE OF COMMODITY CREDIT CORPORATION.—^The Secretary 
may use the funds of the Commodity Credit Corporation to carry 
out this section. 
110 STAT. 950 
PUBLIC LAW 104-127—APR. 4, 1996 
(h) EXCLUSIONS.—^Noninsured crop disaster assistance under 
this section shall not cover losses due to— 
(1) the neglect or malfeasance of the producer; 
(2) the failure of the producer to reseed to the same crop 
in those areas and under such circumstances where it is cus-
tomary to reseed; or 
(3) the failure of the producer to follow good farming prac-
tices, as determined by the Secretary. 
(i) PAYMENT AND INCOME LIMITATIONS.— 
(1) DEFINITIONS.—In this subsection: 
(A) PERSON.—The term "person" has the meaning pro-
vided the term in regulations issued by the Secretary. 
The regulations shall conform, to the extent practicable, 
to the regulations defining 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 "qualify-
ing gross revenues" means— 
(i) if a majority of the gross revenue of the person 
is received from farming, ranching, and forestry oper-
^ ations, 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 operations, 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 
section may not exceed $100,000. 
(3) LIMITATION ON MULTIPLE BENEFITS FOR SAME LOSS.— 
If a producer who is eligible to receive benefits under this 
section is also eligible to receive assistance for the same loss 
under any other program administered by the Secretary, the 
producer shall be required to elect whether to receive benefits 
under this section or under the other program, but not both. 
(4) INCOME LIMITATION.—^A person who has qualifying gross 
revenues in excess of the amount specified in section 2266(a) 
of the Food, Agriculture, 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 limitation regulations of the Secretary, and the limita-
tions established under this subsection. 
(j) CONFORMING REPEAL.—Section 519 of the Federal Crop 
Insurance Act (7 U.S.C. 1519) is repealed. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 951 
TITLE II—AGRICULTURAL TRADE 
Subtitle A—^Amendments to Agricultural 
Trade Development and Assistance Act 
of 1954 and Related Statutes 
SEC. 201. FOOD AID TO DEVELOPING COUNTRIES. 
(a) IN GENERAL.—Section 3 of the Agricultural Trade Develop-
ment and Assistance Act of 1954 (7 U.S.C. 1691a) is amended 
to read as follows: 
"SEC. 3. FOOD AID TO DEVlilLOPING COUNTRIES. 
"(a) POLICY.—In light of the Uruguay Round Agreement on 
Agriculture and the Ministerial Decision on Measures Concerning 
the Possible Negative Effects of the Reform Program on Least-
Developed and Net-Food Importing Developing Countries, the 
United States reaffirms the commitment of the United States to 
providing food aid to developing countries. 
"(b) SENSE OF CONGRESS.—It is the sense of Congress that— 
"(1) the President should initiate consultations with other 
donor nations to consider appropriate levels of food aid commit-
ments to meet the legitimate needs of developing countries; 
and 
"(2) the United States should increase its contribution of 
bona fide food assistance to developing countries consistent 
with the Agreement on Agriculture.". 
(b) CONFORMING AMENDMENT.—Section 411 of the Uruguay 
Round Agreements Act is amended by striking subsection (e) (19 
U.S.C. 3611). 
SEC. 202. TRADE AND DEVELOPMENT ASSISTANCE. 
Section 101 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1701) is amended— 
(1) by striking "developing countries" each place it appears 
and inserting "developing countries and private entities"; and 
(2) in subsection (b), by inserting "and entities" before 
the period at the end. 
SEC. 203. AGREEMENTS REGARDING ELIGIBLE COUNTRIES AND PRI-
VATE ENTITIES. 
Section 102 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1702) is amended to read as follows: 
"SEC. 102. AGREEMENTS REGARDING ELIGIBLE COUNTRIES AND PRI-
VATE ENTITIES. 
"(a) PRIORITY.—In selecting agreements to be entered into under 
this title, the Secretary shall give priority to agreements providing 
for the export of agricultural commodities to developing countries 
that— 
"(1) have the demonstrated potential to become commercial 
markets for competitively priced United States agricultural 
commodities; 
"(2) are undertaking measures for economic development 
purposes to improve food security and agricultural development, 
alleviate poverty, and promote broad-based equitable and 
sustainable development; and 
110 STAT. 952 
PUBLIC LAW 104-127—APR. 4, 1996 
"(3) demonstrate the greatest need for food. 
"(b) PRIVATE ENTITIES.—^An agreement entered into under this 
title with a private entity shall require such security, or such 
other provisions as the Secretary determines necessary, to provide 
reasonable and adequate assurance of repayment of the financing 
extended to the private entity. 
"(c) AGRICULTURAL MARKET DEVELOPMENT PLAN.— 
"(1) DEFINITION OF AGRICULTURAL TRADE ORGANIZATION.— 
In this subsection, the term 'agricultural trade organization' 
means a United States agricultural trade organization that 
promotes the export and sale of a United States agricultural 
commodity and that does not stand to profit directly from 
the specific sale of the commodity. 
"(2) PLAN.—The Secretary shall consider a developing coun-
try for which an agricultural market development plan has 
been approved under this subsection to have the demonstrated 
potential to become a commercial market for competitively 
priced United States agricultural commodities for the purpose 
of granting a priority under subsection (a). 
"(3) REQUIREMENTS.— 
"(A) IN GENERAL.—To be approved by the Secretary, 
an agricultural market development plan shall— 
"(i) be submitted by a developing country or private 
entity, in conjunction with an agricultural 
trade 
organization; 
"(ii) describe a project or program for the develop-
ment and expansion of a commercial market for a 
United States agricultural commodity in a developing 
country, and the economic development of the country, 
using funds derived from the sale of agricultural 
commodities received under an agreement described 
in section 101; 
"(iii) provide for any matching funds that are 
required by the Secretary for the project or program; 
"(iv) provide for a results-oriented means of meas-
uring the success of the project or program; and 
"(v) provide for graduation to the use of non-Fed-
eral funds to carry out the project or program, consist-
ent with requirements established by the Secretary. 
"(B) AGRICULTURAL TRADE ORGANIZATION.—^The project 
or program shall be designed and carried out by the agricul-
tural trade organization. 
"(C) ADDITIONAL REQUIREMENTS.—^An agricultural mar-
ket development plan shall contain such additional require-
ments as are determined necessary by the Secretary. 
"(4) ADMINISTRATIVE COSTS.— 
"(A) IN GENERAL.—^The Secretary may make funds 
made available to carry out this title available for the 
reimbursement of administrative expenses incurred by 
agricultural trade organizations in developing, implement-
ing, and administering agricultural market development 
plans, subject to such requirements and in such amounts 
as the Secretary considers appropriate. 
"(B) DURATION.—The funds may be made available 
to agricultural trade organizations for the duration of the 
applicable agricultural market development plan. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 953 
"(C) TERMINATION.—The Secretary may terminate 
assistance made available under this subsection if the agri-
cultural trade organization is not carrying out the approved 
agricultural market development plan.". 
SEC. 204. TERMS AND CONDITIONS OF SALES. 
Section 103 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1703) is amended— 
(1) in subsection (a)(2)(A)— 
(A) by striking "a recipient country to make"; and 
(B) by striking "such country" and inserting "the appro-
priate country"; 
(2) in subsection (c), by striking "less than 10 nor"; and 
(3) in subsection (d)— 
(A) by striking "recipient country" and inserting "devel-
oping country or private entity"; and 
(B) by striking "7" and inserting "5". 
SEC. 205. USE OF LOCAL CURRENCY PAYMENT. 
Section 104 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1704) is amended— 
(1) in subsection (a), by striking "recipient country" and 
inserting "developing country or private entity"; and 
(2) in subsection (c)— 
(A) by striking "recipient country" each place it appears 
and inserting "appropriate developing country"; and 
(B) in paragraph (3), by striking "recipient countries" 
and inserting "appropriate developing countries". 
SEC. 206. VALUE-ADDED FOODS. 
Section 105 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1705) is repealed. 
SEC. 207. ELIGIBLE ORGANIZATIONS. 
(a) IN GENERAL.—Section 202 of the Agricultural Trade Devel-
opment and Assistance Act of 1954 (7 U.S.C. 1722) is amended— 
(1) by striking subsection (b) and inserting the following: 
"(b) NONEMERGENCY ASSISTANCE.— 
"(1) IN GENERAL.—The Administrator may provide agricul-
tural commodities for nonemergency assistance under this title 
through eligible organizations (as described in subsection (d)) 
that have entered into an agreement with the Administrator 
to use the commodities in accordance with this title. 
"(2) LIMITATION.—The Administrator may not deny a 
request for funds submitted under this subsection because the 
program for which the funds are requested— 
"(A) would be carried out by the eligible organization 
in a foreign country in which the Agency for International 
Development does not have a mission, office, or other pres-
ence; or 
"(B) is not part of a development plan for the country 
prepared by the Agency."; and 
(2) in subsection (e)— 
(A) in the subsection heading, by striking "PRIVATE 
VOLUNTARY 
ORGANIZATIONS 
AND 
COOPERATIVES" 
and 
inserting "ELIGIBLE ORGANIZATIONS"; 
(B) in paragraph (1)— 
110 STAT. 954 
PUBLIC LAW 104-127—APR. 4, 1996 
(i) by striking 
"$13,500,000" 
and 
inserting 
"$28,000,000"; and 
(ii) by striking "private voluntary organizations 
and cooperatives to assist such organizations and 
cooperatives" and inserting "eligible 
organizations 
described in subsection (d), to assist the organizations"; 
(C) by striking paragraph (2) and inserting the follow-
ing: 
"(2) REQUEST FOR FUNDS.—To receive funds made available 
under paragraph (1), an eligible organization described in sub-
section (d) shall submit a request for the funds that is subject 
to approval by the Administrator."; and 
(D) in paragraph (3), by striking "a private voluntary 
organization or cooperative, the Administrator may provide 
assistance to that organization or cooperative" and insert-
ing "an eligible organization, the Administrator may pro-
vide assistance to the eligible organization". 
(b) CONFORMING AMENDMENTS.—Section 207 of the Agricultural 
Trade Development and Assistance Act of 1954 (7 U.S.C. 1726a) 
is amended— 
(1) in subsection (a)(1), by striking "a private voluntary 
organization or cooperative" each place it appears and inserting 
"an eligible organization"; and 
(2) in subsection (b)— 
(A) in paragraph (1), by striking "private voluntary 
organizations and cooperatives" and inserting "eligible 
organizations"; and 
(B) in paragraph (2), by striking "organizations, 
cooperatives," and inserting "eligible organizations". 
SEC. 
208. 
GENERATION 
AND 
USE 
OF 
FOREIGN 
CURRENCIES. 
Section 203 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1723) is amended— 
(1) in subsection (a), by inserting ", or in a country in 
the same region," after "in the recipient country"; 
(2) in subsection (b)— 
(A) by inserting "or in countries in the same region," 
after "in recipient countries,"; and 
(B) by striking "10 percent" and inserting "15 percent"; 
(3) in subsection (c), by inserting "or in a country in the 
same region," after "in the recipient country,"; and 
(4) in subsection (d)(2), by inserting "or within a country 
in the same region" after "within the recipient country". 
SEC. 209. GENERAL LEVELS OF ASSISTANCE UNDER PUBLIC LAW 480. 
Section 204 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1724) is amended— 
(1) in subsection (a)— 
(A) in paragraph (1), by striking "amount that" and 
all that follows through the period at the end and inserting 
"amount that for each of fiscal years 1996 through 2002 
is not less than 2,025,000 metric tons."; 
(B) in paragraph (2), by striking "amount that" and 
all that follows through the period at the end and inserting 
"amount that for each of fiscal years 1996 through 2002 
is not less than 1,550,000 metric tons."; and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 955 
(C) in paragraph (3), by adding at the end the following: 
"No waiver shall be made before the beginning of the 
applicable fiscal year."; and 
(2) in subsection (b)(1), by inserting before the period at 
the end the following: "and that not less than 50 percent 
of the quantity of the bagged commodities that are whole grain 
commodities be bagged in the United States". 
SEC. 210. FOOD AID CONSULTATIVE GROUP. 
Section 205 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1725) is amended— 
(1) in subsection (a), by striking "private voluntary 
organizations, cooperatives and indigenous non-governmental 
organizations" and inserting "eligible organizations described 
in section 202(d)(1)"; 
(2) in subsection (b)— 
(A) in paragraph (2), by striking "for International 
Affairs and Commodity Programs" and inserting "of Agri-
culture for Farm and Foreign Agricultural Services"; 
(B) in paragraph (4), by striking "and" at the end; 
(C) in paragraph (5), by striking the period at the 
end and inserting "; and"; and 
(D) by adding at the end the following: 
"(6) representatives from agricultural producer groups in 
the United States."; 
(3) in the second sentence of subsection (d), by inserting 
"(but at least twice per year)" after "when appropriate"; and 
(4) in subsection (f), by striking "1995" and inserting "2002". 
SEC. 211. SUPPORT OF NONGOVERNMENTAL ORGANIZATIONS. 
(a) IN GENERAL.—Section 306(b) of the Agricultural Trade 
Development and Assistance Act of 1954 (7 U.S.C. 1727e(b)) is 
amended— 
(1) in the subsection heading, by striking "INDIGENOUS 
NON-GOVERNMENTAL" and inserting "NONGOVERNMENTAL"; and 
(2) by striking "utilization of indigenous" and inserting 
"utilization of. 
(b) CONFORMING AMENDMENT.—Section 402 of the Agricultural 
Trade Development and Assistance Act of 1954 (7 U.S.C. 1732) 
is amended by striking paragraph (6) and inserting the following: 
"(6) NONGOVERNMENTAL ORGANIZATION.—^The term 'non-
governmental organization' means an organization that works 
at the local level to solve development problems in a foreign 
country in which the organization is located, except that the 
term does not include an organization that is primarily an 
agency or instrumentality of the government of the foreign 
country.". 
SEC. 212. COMMODITY DETERMINATIONS. 
Section 401 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1731) is amended— 
(1) by striking subsections (a) through (d) and inserting 
the following: 
"(a) AVAILABILITY OF COMMODITIES.—^No agricultural commod-
ity shall be available for disposition under this Act if the Secretary 
determines that the disposition would reduce the domestic supply 
of the commodity below the supply needed to meet domestic require-
ments and provide adequate carryover (as determined by the Sec-
110 STAT. 956 
PUBLIC LAW 104-127—APR. 4, 1996 
retary), unless the Secretary determines that some part of the 
supply should be used to carry out urgent humanitarian purposes 
under this Act."; 
(2) by redesignating subsections (e) and (f) as subsections 
(b) and (c), respectively; and 
(3) in subsection (c) (as so redesignated), by striking "(e)(1)" 
and inserting "(b)(1)". 
SEC. 213. GENERAL PROVISIONS. 
Section 403 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1733) is amended— 
(1) in subsection (b)— 
(A) in the subsection heading, by striking "CONSULTA-
TIONS" and inserting "IMPACT ON LOCAL FARMERS AND 
ECONOMY"; and 
(B) by striking "consult with" and all that follows 
through "other donor organizations to"; 
(2) in subsection (c)— 
(A) by striking "from countries"; and 
(B) by striking "for use" and inserting "or use"; 
(3) in subsection (f)— 
(A) by inserting "or private entities, as appropriate," 
after "from countries"; and 
(B) by inserting "or private entities" after "such coun-
tries"; and 
(4) in subsection (i)(2), by striking subparagraph (C). 
SEC. 214. AGREEMENTS. 
Section 404 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1734) is amended— 
(1) in subsection (a), by inserting "with foreign countries" 
after "Before entering into agreements"; 
(2) in subsection (b)(2)— 
(A) by inserting "with foreign countries" after "with 
respect to agreements entered into"; and 
(B) by inserting before the semicolon at the end the 
following: "and broad-based economic growth"; and 
(3) in subsection (c), by striking paragraph (1) and inserting 
the following: 
"(1) IN GENERAL.—^Agreements to provide assistance on 
a multi-year basis to recipient countries or to eligible organiza-
tions— 
"(A) may be made available under titles I and III; 
and 
"(B) shall be made available under title II.". 
SEC. 215. USE OF COMMODITY CREDIT CORPORATION. 
Section 406 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1736) is amended— 
(1) in subsection (a), by striking "shall" and inserting "may"; 
and 
(2) in subsection (b)— 
(A) by striking "this Act" and inserting "titles II and 
III"; and 
(B) by striking paragraph (4) and inserting the follow-
ing: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 957 
"(4) the vessel freight charges from United States ports 
or designated Canadian transshipment ports, as determined 
by the Secretary, to designated ports of entry abroad;". 
SEC. 216. ADMINISTRATIVE PROVISIONS. 
Section 407 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1736a) is amended— 
(1) in subsection (a)— 
(A) in paragraph (1), by inserting "or private entity 
that enters into an agreement under title I" after "import-
ing country"; and 
(B) in paragraph (2), by adding at the end the following: 
"Resulting contracts may contain such terms and conditions 
as the Secretary determines are necessary and appro-
priate."; 
(2) in subsection (c)— 
(A) in paragraph (1)(A), by inserting "importer or" 
before "importing country"; and 
(B) in paragraph (2)(A), by inserting "importer or" 
before "importing country"; 
(3) in subsection (d)— 
(A) by striking paragraph (2) and inserting the follow-
ing: 
"(2) FREIGHT PROCUREMENT.—Notwithstanding the Federal 
Property and Administrative Services Act of 1949 (40 U.S.C. 
471 et seq.) or other similar provisions of law relating to the 
making or performance of Federal Government contracts, ocean 
transportation under titles II and III may be procured on 
the basis of full and open competitive procedures. Resulting 
contracts may contain such terms and conditions as the 
Administrator determines are necessary and appropriate."; and 
(B) by striking paragraph (4); 
(4) in subsection (g)(2)— 
(A) in subparagraph (B), by striking "and" at the end; 
(B) in subparagraph (C), by striking the period at 
the end and inserting "; and"; and 
(C) by adding at the end the following: 
"(D) an assessment of the progress towards achieving 
food security in each country receiving food assistance from 
the United States Government, with special emphasis on 
the nutritional status of the poorest populations in each 
country."; and 
(5) by striking subsection (h). 
SEC. 217. EXPIRATION DATE. 
Section 408 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1736b) is amended by striking "1995" 
and inserting "2002". 
SEC. 218. REGULATIONS. 
Section 409 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1736c) is repealed. 
SEC. 
2
1
9
. 
INDEPENDENT 
EVALUATION 
OF 
PROGRAMS. 
Section 410 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1736d) is repealed. 
110 STAT. 958 
PUBLIC LAW 104-127—APR. 4, 1996 
SEC. 220. AUTHORIZATION OF APPROPRIATIONS. 
Section 412 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1736f) is amended— 
(1) by striking subsections (b) and (c) and inserting the 
following: 
"(b) TRANSFER OF FUNDS.— 
"(1) IN GENERAL.—Except as provided in paragraph (2) 
and notwithstanding any other provision of law, the President 
may direct that up to 15 percent of the funds available for 
any fiscal year for carrying out any title of this Act be used 
to carry out any other title of this Act. 
"(2) TITLE HI FUNDS.—The President may direct that up 
to 50 percent of the funds available for any fiscal year for 
carrying out title III be used to carry out title II."; and 
(2) by redesignating subsections (d) and (e) as subsections 
(c) and (d), respectively. 
SEC. 221. COORDINATION OF FOREIGN ASSISTANCE PROGRAMS. 
Section 413 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1736g) is amended by striking "this 
Act" each place it appears and inserting "title III". 
SEC. 222. MICRONUTRIENT FORTIFICATION PILOT PROGRAM. 
Title IV of the Agricultural Trade Development and Assistance 
Act of 1954 (7 U.S.C. 1731 et seq.) is amended by adding at 
the end the following: 
Establishment. 
"SEC. 415. MICRONUTRIENT FORTIFICATION PILOT PROGRAM. 
coimtries. 
"(a) IN GENERAL.—Subject to the availability of practical tech-
7 use l736g-2. 
nology and to cost effectiveness, not later than September 30, 1997, 
the Secretary, in consultation with the Administrator, shall estab-
lish a micronutrient fortification pilot program under this Act. 
The purpose of the program shall be to— 
"(1) assist developing countries in correcting micronutrient 
dietary deficiencies among segments of the populations of the 
countries; and 
"(2) encourage the development of technologies for the for-
tification of whole grains and other commodities that are readily 
transferable to developing countries. 
"(b) SELECTION OF PARTICIPATING COUNTRIES.—From among 
the countries eligible for assistance under this Act, the Secretary 
may select not more than 5 developing countries to participate 
in the pilot program. 
"(c) FORTIFICATION.—Under the pilot program, whole grains 
and other commodities made available to a developing country 
selected to participate in the pilot program may be fortified with 
1 or more micronutrients (including vitamin A, iron, and iodine) 
with respect to which a substantial portion of the population in 
the country is deficient. The commodity may be fortified in the 
United States or in the developing country. 
"(d) TERMINATION OF AUTHORITY.—The authority to carry out 
the pilot program established under this section shall terminate 
on September 30, 2002.". 
SEC. 
2
2
3
. 
USE 
OF 
CERTAIN 
LOCAL 
CURRENCY. 
Title IV of the Agricultural Trade Development and Assistance 
Act of 1954 (7 U.S.C. 1731 et seq.) (as amended by section 222) 
is amended by adding at the end the following: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 959 
"SEC. 
4
1
6
. 
USE 
OF 
CERTAIN 
LOCAL 
CURRENCY. 
"Local currency payments received by the United States pursu-
ant to agreements entered into under title I (as in effect on Novem-
ber 27, 1990) may be utilized by the Secretary in accordance with 
section 108 (as in effect on November 27, 1990).". 
SEC. 224. FARMER-TO-FARMER PROGRAM. 
Section 501 of the Agricultural Trade Development and Assist-
ance Act of 1954 (7 U.S.C. 1737) is amended— 
(1) in subsection (a), by striking paragraph (6) and inserting 
the following: 
"(6) to the extent that local currencies can be used to 
meet the costs of a program established under this section, 
augment funds of the United States that are available for 
such a program through the use of foreign currencies that 
accrue from the sale of agricultural commodities under this 
Act, and local currencies generated from other types of foreign 
assistance activities, within the country where the program 
is being conducted."; and 
(2) in subsection (c)— 
(A) by striking "0.2" and inserting "0.4"; 
(B) by striking "1991 through 1995" and inserting 
"1996 through 2002"; and 
(C) by striking "0.1" and inserting "0.2". 
SEC. 225. FOOD SECURITY COMMODITY RESERVE. 
(a) IN GENERAL.—Title III of the Agricultural Act of 1980 
(7 U.S.C. 1736f-l et seq.) is amended to read as follows: 
"TITLE III—FOOD SECURITY 
COMMODITY RESERVE 
"SEC. 301. SHORT TITLE. 
"This title may be cited as the 'Food Security Commodity 
Reserve Act of 1996'. 
"SEC. 302. ESTABLISHMENT OF COMMODITY RESERVE. 
"(a) IN GENERAL.—To provide for a reserve solely to meet 
emergency humanitarian food needs in developing countries, the 
Secretary of Agriculture (referred to in this title as the 'Secretary') 
shall establish a reserve stock of wheat, rice, corn, or sorghum, 
or any combination of the commodities, totaling not more than 
4,000,000 metric tons for use as described in subsection (c). 
"(b) COMMODITIES IN RESERVE.— 
"(1) IN GENERAL.—The reserve established under this sec-
tion shall consist o
f
— 
"(A) wheat in the reserve established under the Food 
Security Wheat Reserve Act of 1980 as of the date of 
enactment of the Federal Agriculture Improvement and 
Reform Act of 1996; 
"(B) wheat, rice, corn, and sorghum (referred to in 
this section as 'eligible commodities') acquired in accord-
ance with paragraph (2) to replenish eligible commodities 
released from the reserve, including wheat to replenish 
wheat released from the reserve established under the 
Food Security Wlieat Reserve Act of 1980 but not replen-
7 u s e 1736g-3. 
Food Security 
Commodity 
Reserve Act of 
1996. 
7 u s e 1736f-l 
note. 
7 u s e 1736f-L 
110 STAT. 960 
PUBLIC LAW 104-127—APR. 4, 1996 
ished as of the date of enactment of the Federal Agriculture 
Improvement and Reform Act of 1996; and 
"(C) such rice, corn, and sorghum as the Secretary 
may, at such time and in such manner as the Secretary 
determines appropriate, acquire as a result of exchanging 
an equivalent value of wheat in the reserve established 
under this section. 
"(2) REPLENISHMENT OF RESERVE.— 
"(A) IN GENERAL.—Subject to subsection (h), commod-
ities of equivalent value to eligible commodities in the 
reserve established under this section may be acquired— 
"(i) through purchases— 
"(I) from producers; or 
"(II) in the market, if the Secretary determines 
that the purchases will not unduly disrupt the 
market; or 
"(ii) by designation by the Secretary of stocks of 
eligible commodities of the Commodity Credit Corpora-
tion. 
"(B) FUNDS.—^Any use of funds to acquire eligible 
commodities through purchases from producers or in the 
market to replenish the reserve must be authorized in 
an appropriations Act. 
"(c) RELEASE OF ELIGIBLE COMMODITIES.— 
"(1) EMERGENCY ASSISTANCE.— 
"(A) IN GENERAL.—Notwithstanding paragraph (2), to 
meet unanticipated need, the Secretary may release eligible 
commodities in any fiscal year, without regard to the avail-
ability of domestic supply of the commodities, to provide 
emergency assistance to developing countries under title 
II of the Agricultural Trade Development and Assistance 
Act of 1954 (7 U.S.C. 1721 et seq.). 
"(B) RELEASE FOR EMERGENCY ASSISTANCE.—If 
the 
eligible commodities needed to meet unanticipated need 
cannot be made available in a timely manner under normal 
means for obtaining eligible commodities for food assistance 
because of unanticipated need for emergency assistance 
as provided under section 202(a) of the Agricultural Trade 
Development and Assistance Act of 1954 (7 U.S.C. 1722(a)), 
the Secretary may in any fiscal year release from the 
reserve— 
"(i) up to 500,000 metric tons of wheat or the 
equivalent value of eligible commodities other than 
wheat; and 
"(ii) up to 500,000 metric tons of any eligible 
commodities under this paragraph that could have 
been released but were not released in prior fiscal 
years. 
"(C) WAIVER OF MINIMUM TONNAGE REQUIREMENTS.— 
Nothing in this paragraph shall require a waiver under 
section 204(a)(3) of the Agricultural Trade Development 
and Assistance Act of 1954 (7 U.S.C. 1724(a)(3)) as a pre-
requisite for the release of eligible commodities under this 
paragraph. 
"(2) EMERGENCY FOOD ASSISTANCE.—Notwithstanding any 
other provision of law, eligible commodities designated or 
acquired for the reserve established under this section may 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 961 
be released by the Secretary to provide, on a donation or 
sale basis, emergency food assistance to developing countries 
at such time as the domestic supply of the eligible commodities 
is so limited that quantities of the eligible commodities cannot 
be made available for disposition under the Agricultural Trade 
Development and Assistance Act of 1954 (7 U.S.C. 1691 et 
seq.) (other than disposition for urgent humanitarian purposes 
under section 401 of the Act (7 U.S.C. 1731)). 
"(3) 
PROCESSING 
OF ELIGIBLE 
COMMODITIES.—Eligible 
commodities that are released from the reserve established 
under this section may be processed in the United States and 
shipped to a developing country when conditions in the recipient 
country require processing. 
"(4) EXCHANGE.—The Secretary may exchange an eligible 
commodity for another United States commodity of equal value, 
including powdered milk, pulses, and vegetable oil. 
"(5) USE OF NORMAL COMMERCIAL PRACTICES.—To the maxi-
mum extent practicable consistent with the fulfillment of the 
purposes of this section and the effective and efficient adminis-
tration of this section, the Secretary shall use the usual and 
customary channels, facilities, arrangements, and practices of 
trade and commerce to carry out this subsection. 
"(d) MANAGEMENT OF ELIGIBLE COMMODITIES.—The Secretary 
shall provide— 
"(1) for the management of eligible commodities in the 
reserve established under this section as to location and quality 
of eligible commodities needed to meet emergency situations; 
and 
"(2) for the periodic rotation or replacement of stocks of 
eligible commodities in the reserve to avoid spoilage and 
deterioration of the commodities. 
"(e) TREATMENT OF RESERVE UNDER OTHER LAW.—Eligible 
commodities in the reserve established under this section shall 
not be— 
"(1) considered a part of the total domestic supply (includ-
ing carryover) for the purpose of subsection (c) or for the pur-
pose of administering the Agricultural Trade Development and 
Assistance Act of 1954 (7 U.S.C. 1691 et seq.); and 
"(2) subject to any quantitative limitation on exports that 
may be imposed under section 7 of the Export Administration 
Act of 1979 (50 U.S.C. App. 2406). 
"(f) USE OF COMMODITY CREDIT CORPORATION.— 
"(1) IN GENERAL.—Subject to the limitations provided in 
this section, the funds, facilities, and authorities of the 
Commodity Credit Corporation shall be used by the Secretary 
in carrying out this section, except that any restriction 
applicable to the acquisition, storage, or disposition of eligible 
commodities owned or controlled by the Commodity Credit Cor-
poration shall not apply. 
"(2) REIMBURSEMENT.— 
"(A) IN GENERAL.—^The Commodity Credit Corporation 
shall be reimbursed for the release of eligible commodities 
from funds made available to carry out the Agricultural 
Trade Development and Assistance Act of 1954 (7 U.S.C. 
1691 et seq.). 
"(B) BASIS FOR REIMBURSEMENT.—The reimbursement 
shall be made on the basis of the lesser of— 
110 STAT. 962 
PUBLIC LAW 104-127—APR. 4, 1996 
"(i) the actual costs incurred by the Commodity 
Credit Corporation with respect to the ehgible commod-
ity; or 
"(ii) the export market price of the eligible commod-
ity (as determined by the Secretary) as of the time 
the eligible commodity is released from the reserve. 
"(C) SOURCE OF FUNDS.—The reimbursement may be 
made from funds appropriated for subsequent fiscal years. 
"(g) FINALITY OF DETERMINATION.—Any determination by the 
Secretary under this section shall be final. 
"(h) TERMINATION OF AUTHORITY.— 
"(1) IN GENERAL.—The authority to replenish stocks of 
eligible commodities to maintain the reserve established under 
this section shall terminate on September 30, 2002. 
"(2) 
DISPOSAL 
OF 
ELIGIBLE 
COMMODITIES.—Eligible 
commodities remaining in the reserve after September 30, 2002, 
shall be disposed of by release for use in providing for emer-
gency humanitarian food needs in developing countries as pro-
vided in this section.". 
(b) CONFORMING AMENDMENT.—Section 208(d) of the Agricul-
tural Trade Suspension Adjustment Act of 1980 (7 U.S.C. 4001(d)) 
is amended by striking paragraph (2) and inserting the following: 
"(2) APPLICABILITY OF CERTAIN PROVISIONS.—Subsections 
(c), (d), (e), and (f)(2) of section 302 of the Food Security 
Commodity Reserve Act of 1996 shall apply to commodities 
in any reserve established under paragraph (1), except that 
the references to 'eligible commodities' in the subsections shall 
be deemed to be references to 'agricultural commodities'.". 
SEC. 226. PROTEIN BYPRODUCTS DERIVED FROM ALCOHOL FUEL 
PRODUCTION. 
Section 1208 of the Agriculture and Food Act of 1981 (7 U.S.C. 
1736n) is repealed. 
SEC. 227. FOOD FOR PROGRESS PROGRAM. 
The Food for Progress Act of 1985 (7 U.S.C. 1736o) is 
amended— 
(1) in subsection (b)— 
(A) in paragraph (1)— 
(i) by striking "(b)(1)" and inserting "(b)"; and 
(ii) in the first sentence, by inserting "intergovern-
mental organizations," after "cooperatives,"; and 
(B) by striking paragraph (2); 
(2) in subsection (e)(4), by striking "203" and inserting 
"406"; 
(3) in subsection (f)— 
(A) in paragraph (1)(B), by striking "in the case of 
the independent states of the former Soviet Union,"; 
(B) by striking paragraph (2); 
(C) in paragraph (4), by inserting "for each of fiscal 
years 1996 through 2002" after "may be used"; and 
(D) by redesignating paragraphs (3) through (5) as 
paragraphs (2) through (4), respectively; 
(4) in subsection (g), by striking "1995" and inserting 
"2002"; 
(5) in subsection (j), by striking "shall" and inserting "may"; 
(6) in subsection (k), by striking "1995" and inserting 
"2002"; 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 963 
(7) in subsection (1)(1)— 
(A) by striking "1991 through 1995" and inserting 
"1996 through 2002"; and 
(B) by inserting ", and to provide technical assistance 
for monetization programs," after "monitoring of food 
assistance programs"; and 
(8) in subsection (m)^ 
(A) by striking "with respect to the independent states 
of the former Soviet Union"; 
(B) by striking "private voluntary organizations and 
cooperatives" each place it appears and inserting "agricul-
tural trade organizations, intergovernmental organizations, 
private voluntary organizations, and cooperatives"; and 
(C) in paragraph (2), by striking "in the independent 
states". 
SEC. 228. USE OF FOREIGN CURRENCY PROCEEDS FROM EXPORT 
SALES FINANCING. 
Section 402 of the Mutual Security Act of 1954 (22 U.S.C. 
1922) is repealed. 
SEC. 229. STIMULATION OF FOREIGN PRODUCTION. 
Section 7 of the Act of December 30, 1947 (61 Stat. 947, chapter 
526; 50 U.S.C. App. 1917), is repealed. 
Subtitle B—^Amendments to Agricultural 
Trade Act of 1978 
SEC. 241. AGRICULTURAL EXPORT PROMOTION STRATEGY. 
(a) IN GENERAL.—Section 103 of the Agricultural Trade Act 
of 1978 (7 U.S.C. 5603) is amended to read as follows: 
"SEC. 103. AGRICULTURAL EXPORT PROMOTION STRATEGY. 
"(a) IN GENERAL.—The Secretary shall develop a strategy for 
implementing Federal agricultural export promotion programs that 
takes into account the new market opportunities for agricultural 
products, including opportunities that result from— 
"(1) the North American Free Trade Agreement and the 
Uruguay Round Agreements; 
"(2) any accession to membership in the World Trade 
Organization; 
"(3) the continued economic growth in the Pacific Rim; 
and 
"(4) other developments. 
"(b) PURPOSE OF STRATEGY.—The strategy developed under sub-
section (a) shall encourage the maintenance, development, and 
expansion of export markets for United States agricultural commod-
ities and related products, including high-value and value-added 
products. 
"(c) GOALS OF STRATEGY.—The strategy developed under sub-
section (a) shall have the following goals: 
"(1) Increase the value of United States agricultural exports 
each year. 
"(2) Increase the value of United States agricultural exports 
each year at a faster rate than the rate of increase in the 
value of overall world export trade in agricultural products. 
110 STAT. 964 
PUBLIC LAW 104-127—APR. 4, 1996 
"(3) Increase the value of United States high-value and 
value-added agricultural exports each year. 
"(4) Increase the value of United States high-value and 
value-added agricultural exports each year at a faster rate 
than the rate of increase in the value of overall world export 
trade in high-value and value-added agricultural products. 
"(5) Ensure that to the extent practicable— 
"(A) all obligations undertaken in the Uruguay Round 
Agreement on Agriculture that significantly increase access 
for United States agricultural commodities are imple-
mented to the extent required by the Uruguay Round 
Agreements; or 
"(B) applicable United States laws are used to secure 
United States rights under the Uruguay Round Agreement 
on Agriculture. 
"(d) PRIORITY MARKETS.— 
"(1) IDENTIFICATION OF MARKETS.—In developing the strat-
egy required under subsection (a), the Secretary shall annually 
identify as priority markets— 
"(A) those markets in which imports of agricultural 
products show the greatest potential for increase; and 
"(B) those markets in which, with the assistance of 
Federal export promotion programs, exports of United 
States agricultural products show the greatest potential 
for increase. 
President. 
"(2) IDENTIFICATION OF SUPPORTING OFFICES.—The Presi-
dent shall identify annually in the budget of the United States 
Government submitted under section 1105 of title 31, United 
States Code, each overseas office of the Foreign Agricultural 
Service that provides assistance to United States exporters 
in each of the priority markets identified under paragraph 
(1).". 
(b) SENSE OF CONGRESS.—It is the sense of Congress that— 
(1) the Committee on Agriculture of the House of Rep-
resentatives and the Committee on Agriculture, Nutrition, and 
Forestry of the Senate should conduct a thorough review of 
agricultural export and food aid programs not later than Decem-
ber 31, 1998; and 
(2) the review should examine what changes, if any, need 
to be made in the programs as a result of the effects of the 
Agricultural Market Transition Act, the Uruguay Round Agree-
ments, changing world market conditions, and such other fac-
tors as the committees consider appropriate. 
(c) ELIMINATION OF REPORT.— 
(1) IN GENERAL.—Section 601 of the Agricultural Trade 
Act of 1978 (7 U.S.C. 5711) is repealed. 
(2) CONFORMING AMENDMENT.—^The last sentence of section 
603 of the Agricultural Trade Act of 1978 (7 U.S.C. 5713) 
is amended by striking ", in a consolidated report," and all 
that follows through "section 601" and inserting "or in a consoli-
dated report". 
SEC. 
242. IMPLEMENTATION OF COMMITMENTS UNDER URUGUAY 
ROUND AGREEMENTS. 
(a) IN GENERAL.—Title I of the Agricultural Trade Act of 1978 
(7 U.S.C. 5601 et seq.) is amended by adding at the end the 
following: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 965 
"SEC. 
106. IMPLEMENTATION OF COMMITMENTS UNDER URUGUAY 
Evaluation. 
ROUND AGREEMENTS. 
7 USC 5606. 
"Not later than September 30 of each year, the Secretary shall 
evaluate whether the obligations undertaken by foreign countries 
under the Uruguay Round Agreement on Agriculture are being 
fully implemented. If the Secretary has reason to believe (based 
on the evaluation) that any foreign country, by not implementing 
the obligations of the country, may be significantly constraining 
an opportunity for United States agricultural exports, the Secretary 
shall— 
"(1) submit the evaluation to the United States Trade Rep-
resentative; and 
"(2) transmit a copy of the evaluation to the Committee 
on Agriculture, and the Committee on Ways and Means, of 
the House of Representatives and the Committee on Agri-
culture, Nutrition, and Forestry, and the Committee on 
Finance, of the Senate.". 
(b) 
MONITORING 
COMPLIANCE 
WITH 
SANITARY 
AND 
PHYTOSANITARY MEASURES.—Section 414 of the Agricultural Trade 
Act of 1978 (7 U.S.C. 5674) is amended by adding at the end 
the following: 
"(c) 
MONITORING 
COMPLIANCE 
WITH 
SANITARY 
AND 
PHYTOSANITARY 
MEASURES.—The Secretary shall monitor the 
compliance of World Trade Organization member countries with 
the sanitary and phytosanitary measures of the Agreement on 
Agriculture of the Uruguay Round of Multilateral Trade Negotia-
tions of the General Agreement on Tariffs and Trade. If the Sec-
retary has reason to believe that any country may have failed 
to meet the commitment on sanitary and phytosanitary measures 
under the Agreement in a manner that adversely impacts the 
exports of a United States agricultural commodity, the Secretary 
shall— 
"(1) provide such information to the United States Trade 
Representative of the circumstances surrounding the matter 
arising under this subsection; and 
"(2) with respect to any such circumstances that the Sec- Reports, 
retary considers to hsive a continuing adverse effect on United 
States agricultural exports, report to the Committee on Agri-
culture, and the Com;mittee on Ways and Means, of the House 
of Representatives and the Committee on Agriculture, Nutri-
tion, and Forestry, and the Committee on Finance, of the Sen-
ate— 
"(A) that a country may have failed to meet the sani-
tary and phytosanitary commitments; and 
"(B) any notice given by the Secretary to the United 
States Trade Representative.". 
SEC. 243. EXPORT CREDITS. 
(a) EXPORT CREDIT GUARANTEE PROGRAM.—Section 202 of the 
Agricultural Trade Act of 1978 (7 U.S.C. 5622) is amended— 
(1) in subsection (a)— 
(A) by striking "GUARANTEES.—The" and inserting the 
following: "GUAR^JsTTEES.— 
"(1) IN GENERAL.—The"; and 
(B) by adding at the end the following: 
"(2) SUPPLIER CREDITS.—In carrying out this section, the 
Commodity Credit Corporation may issue guarantees for the 
110 STAT. 966 
PUBLIC LAW 104-127—APR. 4, 1996 
repayment of credit made available for a period of not more 
than 180 days by a United States exporter to a buyer in 
a foreign country."; 
(2) in subsection (f)— 
(A) by striking "(0 RESTRICTIONS.—The" and inserting 
the following: 
"(f) RESTRICTIONS.— 
"(1) IN GENERAL.—The"; and 
(B) by adding at the end the following: 
"(2) CRITERIA FOR DETERMINATION.—In making the deter-
mination required under paragraph (1) with respect to credit 
guarantees under subsection (b) for a country, the Secretary 
may consider, in addition to financial, macroeconomic, and 
monetary indicators— 
"(A) whether an International Monetary Fund standby 
agreement, Paris Club rescheduling plan, or other economic 
restructuring plan is in place with respect to the country; 
"(B) whether the country is addressing issues such 
as— 
"(i) the convertibility of the currency of the country; 
"(ii) adequate legal protection for foreign invest-
ments; 
"(iii) the viability of the financial markets of the 
country; and 
"(iv) adequate legal protection for the private prop-
erty rights of citizens of the country; or 
"(C) any other factors that are relevant to the ability 
of the country to service the debt of the country."; 
(3) by striking subsection (h) and inserting the following: 
"(h) 
UNITED 
STATES 
AGRICULTURAL 
COMMODITIES.—The 
Commodity Credit Corporation shall finance or guarantee under 
this section only United States agricultural commodities."; 
(4) in subsection (i)— 
(A) by striking paragraph (1); 
(B) by striking "INSTITUTIONS.—^A financial" and insert-
ing the following: "INSTITUTIONS.— 
"(1) IN GENERAL.—^A financial"; 
(C) by striking "(2) is" and inserting the following: 
"(A) is"; 
(D) by striking "(3) is" and inserting the following: 
"(B) is"; and 
(E) by adding at the end the following: 
"(2) THIRD COUNTRY BANKS.—The Commodity Credit Cor-
poration may guarantee under subsections (a) and (b) the repay-
ment of credit made available to finance an export sale irrespec-
tive of whether the obligor is located in the country to which 
the export sale is destined."; and 
(5) by striking subsection (k) and inserting the following: 
"(k) PROCESSED AND HIGH-VALUE PRODUCTS.— 
"(1) IN GENERAL.—In issuing export credit guarantees 
under this section, the Commodity Credit Corporation shall, 
subject to paragraph (2), ensure that not less than 25 percent 
for each of fiscal years 1996 and 1997, 30 percent for each 
of fiscal years 1998 and 1999, and 35 percent for each of 
fiscal years 2000, 2001, and 2002, of the total amount of credit 
guarantees issued for a fiscal year is issued to promote the 
export of processed or high-value agricultural products and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 967 
that the balance is issued to promote the export of bulk or 
raw agricultural commodities. 
"(2) LIMITATION.—The percentage requirement of para-
graph (1) shall apply for a fiscal year to the extent that a 
reduction in the total amount of credit guarantees issued for 
the fiscal year is not required to meet the percentage require-
ment.". 
(b) FUNDING LEVELS.—Section 211 of the Agricultural Trade 
Act of 1978 (7 U.S.C. 5641) is amended by striking subsection 
(b) and inserting the following: 
"(b) EXPORT CREDIT GUARANTEE PROGRAMS.— 
"(1) EXPORT CREDIT GUARANTEES.—^The Commodity Credit 
Corporation shall make available for each of fiscal years 1996 
through 2002 not less than $5,500,000,000 in credit guarantees 
under subsections (a) and (b) of section 202. 
"(2) LIMITATION ON ORIGINATION FEE.—Notwithstanding 
any other provision of law, the Secretary may not charge an 
origination fee with respect to any credit guarantee transaction 
under section 202(a) in excess of an amount equal to 1 percent 
of the amount of credit to be guaranteed under the transaction, 
except with respect to an export credit guarantee transaction 
pursuant to section 1542(b) of the Food, Agriculture, Conserva-
tion, and Trade Act of 1990 (Public Law 101-624; 7 U.S.C. 
5622 note).". 
(c) DEFINITION OF UNITED STATES AGRICULTURAL COMMOD-
ITY.—Section 102(7) of the Agricultural Trade Act of 1978 (7 U.S.C. 
5602(7)) is amended by striking subparagraphs (A) and (B) and 
inserting the following: 
"(A) an agricultural commodity or product entirely pro-
duced in the United States; or 
"(B) a product of an agricultural commodity— 
"(i) 90 percent or more of the agricultural compo-
nents of which by weight, excluding packaging and 
added water, is entirely produced in the United States; 
and 
"(ii) that the Secretary determines to be a high 
value agricultural product.". 
(d) REGULATIONS.—Not later than 180 days after the date of 7 USC 5622 note. 
enactment of this Act, the Secretary of Agriculture shall issue 
regulations to carry out the amendments made by this section. 
SEC. 244. MARKET ACCESS PROGRAM. 
(a) CHANGE OF NAME.— 
(1) IN GENERAL.—Section 203 of the Agricultural Trade 
Act of 1978 (7 U.S.C. 5623) is amended— 
(A) in the section heading, by striking "MARKET PRO-
MOTION PROGRAM" and inserting "MARKET ACCESS PRO-
GRAM"; and 
(B) by striking "marketing promotion program" each 
place it appears and inserting "market access program". 
(2) CONFORMING AMENDMENTS.— 
(A) Section 1302 of the Omnibus Budget Reconciliation 
Act of 1993 (Public Law 103-66; 7 U.S.C. 5623) is 
amended— 
(i) in the section heading, by striking "MARKET 
PROMOTION PROGRAM" and inserting "MARKET ACCESS 
PROGRAM"; and 
110 STAT. 968 
PUBLIC LAW 104-127—APR. 4, 1996 
7 use 5623 note. 
(ii) in subsection (b), by striking "market promotion 
program" each place it appears and inserting "market 
access program". 
(B) Section 211(c) of the Agricultural Trade Act of 
1978 (7 U.S.C. 5641(c)) is amended— 
(i) in the subsection heading, by striking "MARKET-
ING PROMOTION PROGRAMS" and 
inserting "MARKET 
ACCESS PROGRAMS"; 
(ii) by striking "market promotion activities" and 
inserting "market access activities"; 
(iii) in paragraph (1), by striking "market develop-
ment program" and inserting "market access program"; 
and 
(iv) in paragraph (2), by striking "marketing pro-
motion program" and inserting "market access pro-
gram", 
(b) USE OF FUNDS.—Section 203(f) of the Agricultural Trade 
Act of 1978 (7 U.S.C. 5623(f)) is amended by adding at the end 
the following: 
"(4) USE OF FUNDS.—Funds made available to carry out 
this section— 
"(A) shall not be used to provide direct assistance to 
any foreign for-profit corporation for the corporation's use 
in promoting foreign-produced products; 
"(B) shall not be used to provide direct assistance to 
any for-profit corporation that is not recognized as a small-
business concern described in section 3(a) of the Small 
Business Act (15 U.S.C. 632(a)), excluding— 
"(i) a cooperative; 
"(ii) an association described in the first section 
of the Act entitled *An Act To authorize association, 
of producers of agricultural products', approved Feb-
ruary 18, 1922 (7 U.S.C. 291); and 
"(iii) a nonprofit trade association; and 
"(C) may be used by a United States trade association, 
cooperative, or small business for individual branded pro-
motional activity related to a United States branded prod-
uct, if the beneficiaries of the activity have provided funds 
for the activity in an amount that is at least equivalent 
to the amount of assistance provided under this section.". 
Effective date. 
(c) FUNDING.—Effective October 1, 1995, section 211(c)(1) of 
the Agricultural Trade Act of 1978 (7 U.S.C. 5641(c)(1)) is 
amended— 
(1) by striking "and" after "1991 through 1993,"; and 
(2) by striking "through 1997," and inserting "through 1995, 
and not more than $90,000,000 for each of fiscal years 1996 
through 2002,". 
SEC. 245. EXPORT ENHANCEMENT PROGRAM. 
Effective date. 
(a) IN GENERAL.—Effective October 1, 1995, section 301(e) of 
the Agricultural Trade Act of 1978 (7 U.S.C. 5651(e)) is amended 
by striking paragraph (1) and inserting the following: 
"(1) IN GENERAL.—The Commodity Credit Corporation shall 
make available to carry out the program established under 
this section not more than— 
"(A) $350,000,000 for fiscal year 1996; 
"(B) $250,000,000 for fiscal year 1997; 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 969 
"(C) $500,000,000 for fiscal year 1998; 
"(D) $550,000,000 for fiscal year 1999; 
"(E) $579,000,000 for fiscal year 2000; 
"(F) $478,000,000 for fiscal year 2001; and 
"(G) $478,000,000 for fiscal year 2002.". 
(b) PRIORITY FUNDING FOR INTERMEDIATE PRODUCTS.—Section 
301 of the Agricultural Trade Act of 1978 (7 U.S.C. 5651) is amended 
by adding at the end the following: 
"(h) PRIORITY FUNDING FOR INTERMEDIATE PRODUCTS.^— 
"(1) IN GENERAL.—Effective beginning in fiscal year 1996, 
and consistent, as determined by the Secretary, with the obliga-
tions and reduction commitments undertaken by the United 
States under the Uruguay Round Agreements, the Secretary 
may make available not more than $100,000,000 for each fiscal 
year under this section for the sale of intermediate agricultural 
products in sufficient quantities to attain the volume of export 
sales consistent with the volume of intermediate agricultural 
products exported by the United States during the Uruguay 
Round base period years of 1986 through 1990. 
"(2) ADDITIONAL ASSISTANCE.—Notwithstanding paragraph 
(1), if the export sale of any intermediate agricultural product 
attains the volume of export sales consistent with the volume 
of the intermediate agricultural product exported by the United 
States during the Uruguay Round base period years of 1986 
through 1990, the Secretary may make available additional 
amounts under this section for the encouragement of export 
sales of the intermediate agricultural product.". 
SEC. 246. ARRIVAL CERTIFICATION. 
Section 401 of the Agricultural Trade Act of 1978 (7 U.S.C. 
5661) is amended by striking subsection (a) and inserting the follow-
ing: 
"(a) ARRIVAL CERTIFICATION.—^With respect to a commodity pro-
vided, or for which financing or a credit guarantee or other assist-
ance is made available, under a program authorized in section 
201, 202, or 301, the Commodity Credit Corporation shall require 
the exporter of the commodity to maintain records of an official 
or customary commercial nature or other documents as the Sec-
retary may require, and shall allow representatives of the Commod-
ity Credit Corporation access to the records or documents as needed, 
to verify the arrival of the commodity in the country that is the 
intended destination of the commodity.". 
SEC. 247. COMPLIANCE. 
Section 402(a) of the Agricultural Trade Act of 1978 (7 U.S.C. 
5662(a)) is amended— 
(1) by striking paragraph (2); and 
(2) by redesignating paragraph (3) as paragraph (2). 
SEC. 248. REGULATIONS. 
. 
Section 404 of the Agricultural Trade Act of 1978 (7 U.S.C. 
5664) is repealed. 
SEC. 249. TRADE COMPENSATION AND ASSISTANCE PROGRAMS. 
Subtitle B of title IV of the Agricultural Trade Act of 1978 
(7 U.S.C. 5671 et seq.) is amended by adding at the end the 
following: 
Effective date. 
Records. 
29-194 O - 96 - 32 : QL 3 Part 1 
110 STAT. 970 
PUBLIC LAW 104-127—APR. 4, 1996 
7 u s e 5677. 
"SEC. 417. TRADE COMPENSATION AND ASSISTANCE PROGRAMS. 
"(a) IN GENERAL.—Except as provided in subsection (f), notwith-
standing any other provision of law, if, after the date of enactment 
of this section, the President or any other member of the executive 
branch causes exports from the United States to any country to 
be unilaterally suspended for reasons of national security or foreign 
policy, and if within 90 days after the date on which the suspension 
is imposed on United States exports no other country with an 
agricultural economic interest agrees to participate in the suspen-
sion, the Secretary shall carry out a trade compensation assistance 
program in accordance with this section (referred to in this section 
as a 'program'). 
"(b) COMPENSATION OR PROVISION OF FUNDS.—Under a pro-
gram, the Secretary shall, based on an evaluation by the Secretary 
of the method most likely to produce the greatest compensatory 
benefit for producers of the commodity involved in the suspension— 
"(1) compensate producers of the commodity by making 
payments available to producers, as provided by subsection 
(c)(1); or 
"(2) make available an amount of funds calculated under 
subsection (c)(2), to promote agricultural exports or provide 
agricultural commodities to developing countries under any 
authorities available to the Secretary. 
"(c) 
DETERMINATION 
OF 
AMOUNT 
OF 
COMPENSATION 
OR 
FUNDS.— 
"(1) COMPENSATION.—If the Secretary makes payments 
available to producers under subsection (b)(1), the amount of 
the payment shall be determined by the Secretary based on 
the Secretary's estimate of the loss suffered by producers of 
the commodity involved due to any decrease in the price of 
the commodity as a result of the suspension. 
"(2) DETERMINATION OF AMOUNT OF FUNDS.—For each fiscal 
year of a program, the amount of funds made available under 
subsection (bX2) shall be equal to 90 percent of the average 
annual value of United States agricultural exports to the coun-
try with respect to which exports are suspended during the 
most recent 3 years prior to the suspension for which data 
are available. 
"(d) DURATION OF PROGRAM.—For each suspension of exports 
for which a program is implemented under this section, funds 
shall be made available under subsection (b) for each fiscal year 
or part of a fiscal year for which the suspension is in effect, 
but not to exceed 3 fiscal years. 
"(e) COMMODITY CREDIT CORPORATION.—The Secretary shall 
use funds of the Commodity Credit Corporation to carry out this 
section. 
"(f) EXCEPTION TO CARRYING OUT A PROGRAM.—This section 
shall not apply to any suspension of trade due to a war or armed 
hostility. 
"(g) PARTIAL YEAR EMBARGOES.—If the Secretary makes funds 
available under subsection (b)(2), regardless of whether an embargo 
is in effect for only part of a fiscal year, the full amount of funds 
as calculated under subsection (c)(2) shall be made available under 
a program for the fiscal year. If the Secretary determines that 
making the required amount of funds available in a partial fiscal 
year is impracticable, the Secretary may make all or part of the 
funds required to be made available in the following fiscal year 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 971 
(in addition to any funds otherwise required under a program 
to be made available in the following fiscal year). 
"(h) SHORT SUPPLY EMBARGOES.—If the President or any other 
member of the executive branch causes exports to be suspended 
based on a determination of short supply, the Secretary shall carry 
out section 1002 of the Food and Agriculture Act of 1977 (7 U.S.C. 
1310).". 
SEC. 250. FOREIGN AGRICULTURAL SERVICE. 
Section 503 of the Agricultural Trade Act of 1978 (7 U.S.C. 
5693) is amended to read as follows: 
"SEC. 503. DUTIES OF FOREIGN AGRICULTURAL SERVICE. 
"The Service shall assist the Secretary in carrying out the 
agricultural trade policy and international cooperation policy of 
the United States by— 
"(1) acquiring information pertaining to agricultural trade; 
"(2) carrying out market promotion and development activi-
ties; 
"(3) providing agricultural technical assistance and train-
ing; and 
"(4) carrying out the programs authorized under this Act, 
the Agricultural Trade Development and Assistance Act of 1954 
(7 U.S.C. 1691 et seq.), and other Acts.". 
SEC. 251. REPORTS. 
The first sentence of section 603 of the Agricultural Trade 
Act of 1978 (7 U.S.C. 5713) is amended by striking "The" and 
inserting "Subject to section 217 of the Department of Agriculture 
Reorganization Act of 1994 (7 U.S.C. 6917), the". 
SEC. 252. FOREIGN MARKET DEVELOPMENT COOPERATOR PROGRAM. 
The Agricultural Trade Act of 1978 (7 U.S.C. 5601 et seq.) 
is amended by adding at the end the following: 
"TITLE VII—FOREIGN MARKET DEVEL-
OPMENT COOPERATOR PROGRAM 
"SEC. 701. DEFINITION OF ELIGIBLE TRADE ORGANIZATION. 
7 USC 5721. 
"In this title, the term 'eligible trade organization' means a 
United States trade organization that— 
"(1) promotes the export of 1 or more United States agricul-
tural commodities or products; and 
"(2) does not have a business interest in or receive remu-
neration from specific sales of agricultural commodities or prod-
ucts. 
"SEC. 702. FOREIGN MARKI]T DEVELOPMENT COOPERATOR PROGRAM. 
Establishment 
"(a) IN GENERAL.—The Secretary shall establish and, in 
cooperation with eligible trade organizations, carry out a foreign 
market development cooperator program to maintain and develop 
foreign markets for United States agricultural commodities and 
products. 
"(b) ADMINISTRATION.—Funds made available to carry out this 
title shall be used only to provide— 
"(1) cost-share assistance to an eligible trade organization 
under a contract or agreement with the organization; and 
110 STAT. 972 
PUBLIC LAW 104-127—APR. 4, 1996 
"(2) assistance for other costs that are necessary or appro-
priate to carry out the foreign market development cooperator 
program, including contingent liabilities that are not otherwise 
funded. 
7 use 5723. 
"SEC. 703. AUTHORIZATION OF APPROPRIATIONS. 
"There are authorized to be appropriated to carry out this 
title such sums as may be necessary for each of fiscal years 1996 
through 2002.". 
Subtitle C—Miscellaneous Agricultural 
Trade Provisions 
7 use 5678. 
SEC. 261. EDWARD R. MADIGAN UNITED STATES AGRICULTURAL 
EXPORT EXCELLENCE AWARD. 
(a) FINDINGS.—Congress finds that— 
(1) United States producers of agricultural products are 
some of the most productive and efficient producers of agricul-
tural products in the world; 
(2) continued growth and expansion of markets for United 
States agricultural exports is crucial to the continued develop-
ment and economic well-being of rural areas of the United 
States and the agricultural sector of the United States economy; 
(3) in recent years, United States agricultural exports have 
steadily increased, surpassing $54,000,000,000 in value in 1995; 
(4) as United States agricultural producers move toward 
a market-oriented system in which planting and other decisions 
by producers are driven by national and international market 
signals, developing new and expanding agricultural export mar-
kets is vital to maintaining a vibrant and healthy agricultural 
sector and rural economy; and 
(5) a United States agricultural export excellence award 
will increase United States agricultural exports by— 
(A) identifying efforts of United States entities to 
develop and expand markets for United States agricultural 
exports through the development of new products and serv-
ices and through the use of innovative marketing tech-
niques; 
(B) recognizing achievements of those who have exhib-
ited or supported entrepreneurial efforts to expand and 
create new markets for United States agricultural exports 
or increase the volume or value of United States agricul-
tural exports; and 
(C) disseminating information on successful methods 
used to develop and expand markets for United States 
agricultural exports. 
(b) ESTABLISHMENT.—There is established the Edward R. Mad-
igan United States Agricultural Export Excellence Award, which 
shall be evidenced by a medal bearing the inscription "Edward 
R. Madigan United States Agricultural Export Excellence Award". 
The medal shall be of such design and materials and bear such 
additional inscriptions as the Secretary of Agriculture (referred 
to in this section as the "Secretary") may prescribe. 
President. 
(c) SELECTION OF RECIPIENT.—The President or the Secretary 
(on the basis of recommendations received from the board estab-
lished under subsection (h)) shall periodically provide the award 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 973 
to companies and other entities that in the judgment of the Presi-
dent or the Secretary substantially encourage entrepreneurial 
efforts in the food and agriculture sector for advancing United 
States agricultural exports. 
(d) PRESENTATION OF AWARD.—The presentation of the award President, 
shall be made by the President or the Secretary with such cere-
monies as the President or the Secretary considers proper. 
(e) PUBLICATION OF AWARD.—^An entity to which an award 
is made under this section may publicize the receipt of the award 
by the entity and use the award in advertising of the entity. 
(f) CATEGORIES FOR WHICH AWARD MAY BE GIVEN.—Separate 
awards shall be made to qualifying entities in each of the following 
categories: 
(1) Development of new products or services for agricultural 
export markets. 
(2) Development of new agricultural export markets. 
(3) Creative marketing of products or sei-vices in agricul-
tural export markets. 
(g) CRITERIA FOR QUALIFICATION.—An entity may qualify for 
an award under this section only if the entity— 
(1)(A) applies to the board established under subsection 
(h) in writing for the award; or 
(B) is recommended for the award by a Governor of a 
State; 
(2)(A) has exhibited significant entrepreneurial effort to 
create new markets for United States agricultural exports or 
increase United States agricultural exports; or 
(B) has provided significant assistance to others in an 
effort to create new markets for United States agricultural 
exports or increase United States agricultural exports; 
(3) has not received another award in the same category 
under subsection (f) during the preceding 5-year period; and 
(4) meets such other requirements and specifications as 
the Secretary determines are appropriate to achieve the objec-
tives of this section. 
(h) BOARD.— 
(1) SELECTION.—The Secretary shall appoint a board of 
evaluators, consisting of at least 5 individuals from the private 
sector selected for their knowledge and experience in exporting 
United States agricultural products. 
(2) MEETINGS.—The board shall meet at least once annually 
to review and evaluate all applicants and entities recommended 
by States under subsection (g)(1). 
(3) RECOMMENDATIONS OF BOARD.—The board shall report Reports, 
its recommendations concerning the making of the award to 
the Secretary. 
(4) TERM.—Each member of the board may serve a term 
of not to exceed 3 years. 
(i) FUNDING.—^The Secretary may seek and accept gifts from 
public and private sources to carry out this section. 
SEC. 262. REPORTING REQUIREMENTS RELATING TO TOBACCO. 
Section 214 of the Tobacco Adjustment Act of 1983 (7 U.S.C. 
509) is repealed. 
110 STAT. 974 
PUBLIC LAW 104-127—APR. 4, 1996 
SEC. 263. TRIGGERED EXPORT ENHANCEMENT. 
(a) READJUSTMENT OF SUPPORT LEVELS.—Section 1302 of the 
Omnibus Budget Reconciliation Act of 1990 (Public Law 101-508; 
7 U.S.C. 1421 note) is repealed. 
(b) 
TRIGGERED MARKETING LOANS AND EXPORT 
ENHANCE-
MENT.—Section 4301 of the Omnibus Trade and Competitiveness 
Act of 1988 (Public Law 100-418; 7 U.S.C. 1446 note) is repealed. 
7 use 1421 note. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall be effective beginning with the 1996 crops of wheat, feed 
grains, upland cotton, and rice. 
SEC. 264. D I S P O S I T I O N OF COMMODITIES TO PREVENT WASTE. 
Section 416 of the Agricultural Act of 1949 (7 U.S.C. 1431) 
is amended— 
(1) in subsection (b)— 
(A) in paragraph (7)— 
(i) in subparagraph (D)(iv), by striking "one year 
of acquisition" and all that follows through the period 
at the end and inserting the following: "a reasonable 
length of time, as determined by the Secretary, except 
that the Secretary may permit the use of proceeds 
in a country other than the country of origin— 
"(I) as necessary to expedite the transportation of 
commodities and products furnished under this subsection; 
or 
"(II) if the proceeds are generated in a currency gen-
erally accepted in the other country."; and 
(ii) by striking the sentence following subpara-
graph (F) and inserting the following: "The Secretary 
may approve the use of proceeds or services realized 
from the sale or barter of a commodity furnished under 
this subsection by a nonprofit voluntary agency, 
cooperative, or intergovernmental agency or organiza-
tion to meet administrative expenses incurred in 
connection with activities undertaken under this sub-
section."; 
(B) in paragraph (8), by striking subparagraph (C); 
and 
(C) by striking paragraphs (10), (11), and (12); and 
(2) by striking subsection (c). 
SEC. 265. DEBT-FOR-HEALTH-AND-PROTECTION SWAP. 
(a) IN GENERAL.—Section 1517 of the Food, Agriculture, Con-
servation, and Trade Act of 1990 (7 U.S.C. 1706) is repealed. 
(b) TECHNICAL AMENDMENT.—Subsection (e)(3) of the Food for 
Progress Act of 1985 (7 U.S.C. 1736o(e)(3)) is amended by striking 
"section 106" and inserting "section 103". 
SEC. 266. POLICY ON EXPANSION OF INTERNATIONAL MARKETS. 
Section 1207 of the Agriculture and Food Act of 1981 (7 U.S.C. 
1736m) is repealed. 
SEC. 267. POLICY ON MAINTENANCE AND DEVELOPMENT OF EXPORT 
MARKETS. 
Section 1121 of the Food Security Act of 1985 (7 U.S.C. 1736p) 
is amended— 
(1) by striking subsection (a); and 
(2) in subsection (b)— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 975 
(A) by striking "(b)"; and 
(B) by striking paragraphs (1) through (4) and inserting 
the following: 
"(1) be the premier supplier of agricultural and food prod-
ucts to world markets and expand exports of high value prod-
ucts; 
"(2) support the principle of free trade and the promotion 
of fair trade in agricultural commodities and products; 
"(3) cooperate fully in all efforts to negotiate with foreign 
countries further reductions in tariff and nontariff barriers 
to trade, including sanitary and phytosanitary measures and 
trade-distorting subsidies; 
"(4) aggressively counter unfair foreign trade practices as 
a means of encouraging fairer trade;". 
SEC. 268. POLICY ON TRADE LIBERALIZATION. 
Section 1122 of the Food Security Act of 1985 (7 U.S.C. 1736q) 
is repealed. 
SEC. 269. AGRICULTURAL TRADE NEGOTIATIONS. 
Section 1123 of the Food Security Act of 1985 (7 U.S.C. 1736r) 
is amended to read as follows: 
"SEC. 1123. TRADE NEGOTIATIONS POLICY. 
"(a) FINDINGS.—Congress fmds that— 
"(1) on a level playing field, United States producers are 
the most competitive suppliers of agricultural products in the 
world; 
"(2) exports 
of United 
States 
agricultural 
products 
accounted for $54,000,000,000 in 1995, contributing a net 
$24,000,000,000 to the merchandise trade balance of the United 
States and supporting approximately 1,000,000 jobs; 
"(3) increased agricultural exports are critical to the future 
of the farm, rural, and overall United States economy, but 
the opportunities for increased agricultural exports are limited 
by the unfair subsidies of the competitors of the United States, 
and a variety of tariff and nontariff barriers to highly competi-
tive United States agricultural products; 
"(4) international negotiations can play a key role in break-
ing down barriers to United States agricultural exports; 
"(5) the Uruguay Round Agreement on Agriculture made 
significant progress in the attainment of increased market 
access opportunities for United States exports of agricultural 
products, for the first time— 
"(A) restraining foreign trade-distorting domestic sup-
port and export subsidy programs; and 
"(B) developing common rules for the application of 
sanitary and phytosanitary restrictions; 
that should result in increased exports of United States agricul-
tural products, jobs, and income growth in the United States; 
"(6) the Uruguay Round Agreement on Agriculture did 
not succeed in completely eliminating trade distorting domestic 
support and export subsidies by— 
"(A) allowing 
the 
European 
Union 
to 
continue 
unreasonable levels of spending on export subsidies; and 
"(B) failing to discipline monopolistic state trading enti-
ties, such as the Canadian Wheat Board, that 
use 
110 STAT. 976 
PUBLIC LAW 104-127—APR. 4, 1996 
nontransparent and discriminatory pricing as a hidden de 
facto export subsidy; 
"(7) during the period 1996 through 2002, there will be 
several opportunities for the United States to negotiate fairer 
trade in agricultural products, including further negotiations 
under the World Trade Organization, and steps toward possible 
free trade agreements of the Americas and Asian-Pacific Eco-
nomic Cooperation (APEC); and 
"(8) the United States should aggressively use these 
opportunities to achieve more open and fair opportunities for 
trade in agricultural products. 
"(b) GOALS OF THE UNITED STATES IN AGRICULTURAL TRADE 
NEGOTIATIONS.—The objectives of the United States with respect 
to future negotiations on agricultural trade include— 
"(1) increasing opportunities for United States exports of 
agricultural products by eliminating tariff and nontariff bar-
riers to trade; 
"(2) leveling the playing field for United States producers 
of agricultural products by limiting per unit domestic produc-
tion supports to levels that are no greater than those available 
in the United States; 
"(3) ending the practice of export dumping by eliminating 
all trade distorting export subsidies and disciplining state trad-
ing entities so that they do not (except in cases of bona fide 
food aid) sell in foreign markets at prices below domestic market 
prices or prices below their full costs of acquiring and delivering 
agricultural products to the foreign markets; and 
"(4) encouraging government policies that avoid price-
depressing surpluses.". 
SEC. 
2
7
0
. 
POLICY 
ON 
UNFAIR 
TRADE 
PRACTICES. 
Section 1164 of the Food Security Act of 1985 (Public Law 
99-198; 99 Stat. 1499) is repealed. 
SEC. 271. AGRICULTURAL AID AND TRADE MISSIONS. 
(a) IN GENERAL.—The Agricultural Aid and Trade Missions 
Act (7 U.S.C. 1736bb et seq.) is repealed. 
(b) CONFORMING AMENDMENT.—Section 7 of Public Law 
100-
277 (7 U.S.C. 1736bb note) is repealed. 
SEC. 
272. 
ANNUAL 
REPORTS 
BY 
AGRICULTURAL 
ATTACHES. 
Section 108(b)(1)(B) of the Agricultural Act of 1954 (7 U.S.C. 
1748(b)(1)(B)) is amended by striking "including fruits, vegetables, 
legumes, popcorn and ducks". 
SEC. 273. WORLD LIVESTOCK MARKET PRICE INFORMATION. 
Section 1545 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (Public Law 101-624; 7 U.S.C. 1761 note) is repealed. 
SEC. 274. ORDERLY LIQUIDATION OF STOCKS. 
Sections 201 and 207 of the Agricultural Act of 1956 (7 U.S.C. 
1851 and 1857) are repealed. 
SEC. 275. SALES OF EXTRA LONG STAPLE COTTON. 
Section 202 of the Agricultural Act of 1956 (7 U.S.C. 1852) 
is repealed. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 977 
SEC. 276. REGULATIONS. 
Section 707 of the Freedom for Russia and Emerging Eurasian 
Democracies and Open Markets Support Act of 1992 (Public Law 
102-511; 7 U.S.C. 5621 note) is amended by striking subsection 
(d). 
SEC. 277. EMERGING MARKETS. 
(a) PROMOTION OF AC;RICULTURAL EXPORTS TO EMP:RGING MAR-
KETS.— 
(1) EMERGING MARKETS.—Section 1542 of the Food, Agri-
culture, Conservation, and Trade Act of 1990 (Public Law 101-
624; 7 U.S.C. 5622 note) is amended— 
(A) in the section heading, by striking "EMERGING 
DEMOCRACIES" and inserting "EMERGING MARKETS"; 
(B) by striking "emerging democracies" each place it 
appears in subsections (b), (d), and (e) and inserting 
"emerging markets"; 
(C) in subsection (c), by striking "emerging democracy" 
each place it appears and inserting "emerging market"; 
and 
(D) by striking subsection (f) and inserting the follow-
ing: 
"(f) EMERGING MARKKT.—In this section and section 15-43, the 
term 'emerging market' means any country that the Secretary deter-
mines— 
"(1) is taking steps toward a market-oriented 
economy 
through the food, agriculture, or rural business sectors of the 
economy of the country; and 
"(2) has the potential to provide a viable and significant 
market for United States agricultural commodities or products 
of United States agricultural commodities.". 
(2) FUNDING.—Section 1542 of the Food, Agriculture, Con-
servation, and Trade Act of 1990 is amended by striking sub-
section (a) and inserting the following: 
"(a) FUNDING.—The Commodity Credit Corporation shall make 
available for 
fiscal 
years 
1996 through 
2002 not less 
than 
$1,000,000,000 of direct credits or export credit guarantees for 
exports to emerging markets under section 201 or 202 of the Agricul-
tural Trade Act of 1978 (7 U.S.C. 5621 and 5622), in addition 
to the amounts acquired or authorized under section 211 of the 
Act (7 U.S.C. 5641) for the program.". 
(3) AGRICULTURAL FELLOWSHIP PROGRAM.—Section 1542 of 
the Food, Agriculture, Conservation, and Trade Act of 1990 
is amended— 
(A) in subsection (b), by striking the last sentence 
and inserting the following: "The Commodity Credit Cor-
poration shall give priority under this subsection to— 
"(A) projects that encourage the privatization of the agricul-
tural sector or that benefit private farms or cooperatives in 
emerging markets; and 
"(B) projects for which nongovernmental persons agree to 
assume a relatively larger share of the costs."; and 
(B) in subsection (d)— 
(i) in the matter preceding paragraph (1), by strik-
ing "the Soviet Union" and inserting "emerging mar-
kets"; 
(ii) in paragraph (1)— 
110 STAT. 978 
PUBLIC LAW 104-127—APR. 4, 1996 
(I) in subparagraph (A)(i)— 
(aa) by striking "1995" and inserting 
"2002"; and 
(bb) by striking "those systems, and iden-
tify" and inserting "the systems, including 
potential reductions in trade barriers, and 
identify and carry out"; 
(II) in subparagraph (B), by striking "shall" 
and inserting "may"; 
(III) 
in 
subparagraph 
(D), by 
inserting 
"(including the establishment of extension serv-
ices)" after "technical assistance"; 
(IV) by striking subparagraph (F); and 
(V) by redesignating subparagraphs (G), (H), 
and (I) as subparagraphs (F), (G), and (H), respec-
tively; 
(iii) in paragraph (2)— 
(I) by striking "the Soviet Union" each place 
it appears and inserting "emerging markets"; 
(II) in subparagraph (A), by striking "a free 
market food production and distribution system" 
and inserting "free market food production and 
distribution systems"; 
(III) in subparagraph (B)— 
(aa) in clause (i), by striking "Govern-
ment" and inserting "governments"; 
(bb) in clause (iii)(II), by striking "and" 
at the end; 
(cc) in clause (iii)(III), by striking the 
period at the end and inserting "; and"; and 
(dd) by adding at the end of clause (iii) 
the following: 
"(IV) to provide for the exchange of administra-
tors and faculty members from agricultural and 
other institutions to strengthen and revise edu-
cational programs in agricultural economics, agri-
business, and agrarian law, to support change 
towards a free market economy in emerging mar-
kets."; 
(IV) by striking subparagraph (D); and 
(V) by redesignating subparagraph (E) as 
subparagraph (D); and 
(iv) by striking paragraph (3). 
(4) 
UNITED 
STATES 
AGRICULTURAL 
COMMODITY.—Sub-
sections (b) and (c) of section 1542 of the Food, Agriculture, 
7 use 5622 note. 
Conservation, and Trade Act of 1990 are amended by striking 
"section 101(6)" each place it appears and inserting "section 
102(7)". 
(5) REPORT.—The first sentence of section 1542(e)(2) of 
the Food, Agriculture, Conservation, and Trade Act of 1990 
is amended by striking "Not" and inserting "Subject to section 
217 of the Department of Agriculture Reorganization Act of 
1994(7U.S.C. 6917), not". 
(b) AGRICULTURAL FELLOWSHIP PROGRAM FOR MIDDLE INCOME 
COUNTRIES, EMERGING DEMOCRACIES, AND EMERGING MARKETS.— 
Section 1543 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 3293) is amended— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 979 
(1) in the section heading, by striking "MIDDLE INCOME 
COUNTRIES AND EMERGING DEMOCRACIES" and inserting "MID-
DLE 
INCOME 
COUNTRIES, 
EMERGING 
DEMOCRACIES, AND 
EMERGING MARKETS"; 
(2) in subsection (b), by adding at the end the following: 
"(5) EMERGING MARKET.—^Any emerging market, as defined 
in section 1542(f)."; and 
(3) in subsection (c)(1), by striking "food needs" and insert-
ing "food and fiber needs". 
(c) CONFORMING AMENDMENTS.— 
(1) Section 501 of the Agricultural Trade Development and 
Assistance Act of 1954 (7 U.S.C. 1737) is amended— 
(A) in subsection (a), by striking "emerging democ-
racies" and inserting "emerging markets"; and 
(B) in subsection (b), by striking paragraph (1) and 
inserting the following: 
"(1) EMERGING MARKET.—The term 'emerging market' 
means any country that the Secretary determines— 
"(A) is taking steps toward a market-oriented economy 
through the food, agriculture, or rural business sectors 
of the economy of the country; and 
"(B) has the potential to provide a viable and signifi-
cant market for United States agricultural commodities 
or products of United States agricultural commodities.". 
(2) Section 201(d)(l)(C)(ii) of the Agricultural Trade Act 
of 1978 (7 U.S.C. 5621(d)(l)(C)(ii)) is amended by striking 
"emerging democracies" and inserting "emerging markets". 
(3) Section 202(d)(3)(B) of the Agricultural Trade Act of 
1978 (7 U.S.C. 5622(d)(3)(B)) is amended by striking "emerging 
democracies" and inserting "emerging markets". 
SEC. 278. REIMBURSEMENT FOR OVERHEAD EXPENSES. 
Section 1542(d)(1)(D) of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (Pubhc Law 101-624; 7 U.S.C. 5622 note) 
is amended by adding at the end the following: "Notwithstanding 
any other provision of law, the assistance shall include assistance 
for administrative and overhead expenses of the International 
Cooperation and Development Program Area of the Foreign Agri-
culture Service, to the extent that the expenses were incurred 
pursuant to reimbursable agreements entered into prior to Septem-
ber 30, 1993, the expenses do not exceed $2,000,000 per year, 
and the expenses are not incurred for information technology sys-
tems.". 
SEC. 279. LABELING OF DOMESTIC AND IMPORTED LAMB AND MUT-
TON. 
Section 7 of the Federal Meat Inspection Act (21 U.S.C. 607) 
is amended by adding at the end the following: 
"(f) LAMB AND MUTTON.—^The Secretary, consistent with United Standards. 
States international obligations, shall establish standards for the 
labeling of sheep carcasses, parts of sheep carcasses, sheepmeat, 
and sheepmeat food products.". 
SEC. 280. IMPORT ASSISTANCE FOR CBI BENEFICIARY COUNTRIES AND 
THE PHILIPPINES. 
Section 583 of Public Law 100-202 (101 Stat. 1329-182) is 
repealed. 
110 STAT. 980 
PUBLIC LAW 104-127—APR. 4, 1996 
SEC. 281. STUDIES, REPORTS, AND OTHER PROVISIONS. 
7 use 624 note. 
(a) IN GENERAL.—Sections 1551 through 1555, section 1558, 
and section 1559 of subtitle E of title XV of the Food, Agriculture, 
Conservation, and Trade Act of 1990 (Public Law 101-624; 104 
Stat. 3696) (as redesignated by section 1011(d) of the Federal 
Reports Elimination and Sunset Act of 1995 (Public Law 104-
66; 109 Stat. 709)) are repealed. 
(b) LANGUAGE PROFICIENCY.—Section 1556 of the Food, Agri-
culture, Conservation, and Trade Act of 1990 (Public Law 101-
624; 7 U.S.C. 5694 note) is amended by striking subsection (c). 
SEC. 282. SENSE OF CONGRESS CONCERNING MULTILATERAL DIS-
CIPLINES ON CREDIT GUARANTEES. 
It is the sense of Congress that— 
(1) in negotiations to establish multilateral disciplines on 
agricultural export credits and credit guarantees, the United 
States should not agree to any arrangement that is incompat-
ible with the provisions of United States law that authorize 
agricultural export credits and credit guarantees; 
(2) in the negotiations (which are held under the auspices 
of the Organization for Economic Cooperation and Develop-
ment), the United States should not reach any agreement that 
fails to impose disciplines on the practices of foreign government 
trading entities such as the Australian Wheat Board, the 
Canadian Wheat Board, the New Zealand Dairy Board, and 
the Australian Dairy Board; and 
(3) the disciplines should include greater openness in the 
operations of the entities as long as the entities are subsidized 
by the foreign government or have monopolies for exports of 
a commodity that are sanctioned by the foreign government. 
22 u s e 288 note 
SEC. 283. INTERNATIONAL COTTON ADVISORY COMMITTEE. 
President. 
(a) IN GENERAL.—The President shall ensure that the Govern-
ment of the United States participates as a full member of the 
International Cotton Advisory Committee. 
(b) REPRESENTATION BY THE SECRETARY.—The Secretary of 
Agriculture shall represent the Government of the United States 
as a member of the International Cotton Advisory Committee and 
shall delegate the primary responsibility to represent the Govern-
ment of the United States to appropriately qualified individuals. 
TITLE III—CONSERVATION 
Subtitle A—Definitions 
SEC. 301. DEFINITIONS APPLICABLE TO HIGHLY ERODIBLE CROPLAND 
CONSERVATION. 
(a) CONSERVATION PLAN AND CONSERVATION SYSTEM.—Section 
1201(a) of the Food Security Act of 1985 (16 U.S.C. 3801(a)) is 
amended— 
(1) by redesignating paragraphs (2) through (16) as para-
graphs (4) through (18), respectively; and 
(2) by inserting after paragraph (1) the following: 
"(2) CONSERVATION PLAN.—The term 'conservation plan' 
means the document that— 
"(A) applies to highly erodible cropland; 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 981 
"(B) describes the conservation system applicable to 
the highly erodible cropland and describes the decisions 
of the person with respect to location, land use, tillage 
systems, and conservation treatment measures and sched-
ule; and 
"(C) is approved by the local soil conservation district, 
in consultation with the local committees established under 
section 8(b)(5) of the Soil Conservation and Domestic Allot-
ment Act (16 U.S.C. 590h(b)(5)) and the Secretary, or by 
the Secretary. 
"(3) CONSERVATION SYSTEM.—^The term 'conservation sys-
tem' means a combination of 1 or more conservation measures 
or management practices that— 
"(A) are based on local resource conditions, available 
conservation technology, and the standards and guidelines 
contained in the Natural Resources Conservation Service 
field office technical guides; and 
"(B) are designed to achieve, in a cost effective and 
technically practicable manner, a substantial reduction in 
soil erosion or a substantial improvement in soil conditions 
on a field or group of fields containing highly erodible 
cropland when compared to the level of erosion or soil 
conditions that existed before the application of the con-
servation measures and management practices.". 
(b) FIELD.—Section 1201(a) of the Food Security Act of 1985 16USC3801. 
is amended by striking paragraph (7) (as redesignated by subsection 
(a)(1)) and inserting the following: 
"(7) FIELD.—The term 'field' means a part of a farm that 
is separated from the balance of the farm by permanent bound-
aries such as fences, roads, permanent waterways, or other 
similar features. At the option of the owner or operator of 
the farm, croplines may also be used to delineate a field if 
farming practices make it probable that the croplines are not 
subject to change. Any highly erodible land on which an agricul-
tural commodity is produced after December 23, 1985, and 
that is not exempt under section 1212, shall be considered 
as part of the field in which the land was included on December 
23, 1985, unless the owner and Secretary agree to modification 
of the boundaries of the field to carry out this title.". 
(c) HIGHLY ERODIBLE LAND.—Section 1201(a)(9) of the Food 
Security Act of 1985 (as redesignated by subsection (a)(1)) is amend-
ed by adding at the end the following: 
"(C) EQUATIONS.—^Not later than 60 days after the 
Federal Register, 
date of enactment of this subparagraph, the Secretary shall publication. 
publish in the Federal Register the universal soil loss equa-
tion and wind erosion equation used by the Department 
of Agriculture as of that date. The Secretary may not 
change the equations after that date except following notice 
and comment in a manner consistent with section 553 
of title 5, United States Code.". 
(d) CONFORMING AMENDMENTS.—Section 1212 of the Food Secu-
rity Act of 1985 (16 U.S.C. 3812) is amended— 
(1) in the first sentence of subsection (a)(2), by striking 
"that documents" and all that follows through "by the Sec-
retary"; 
110 STAT. 982 
PUBLIC LAW 104-127—APR. 4, 1996 
(2) in subsection (c)(3), by striking "based on" and all 
that follows through "and the Secretary," and inserting ", in 
which case,"; 
(3) in subsection (e)(1)(A), by striking "conservation compli-
ance plan" and inserting "conservation plan"; and 
(4) in subsection (f)— 
(A) in paragraph (1), by striking "that documents" and 
all that follows through "under subsection (a)"; 
(B) in paragraph (3), by striking "prepared under sub-
section (a)"; and 
(C) in paragraph (4), by striking "that documents" and 
all that follows through "subsection (a)". 
Subtitle B—Highly Erodible Land 
Conservation 
SEC. 311. PROGRAM INELIGIBILITY. 
Effective date. 
Effective 90 days after the date of enactment of this Act, 
section 1211 of the Food Security Act of 1985 (16 U.S.C. 3811) 
is amended— 
(1) in the matter preceding paragraph (1), by striking "fol-
lowing the date of enactment of this Act,"; 
(2) in paragraph (1)— 
(A) by striking subparagraph (A) and inserting the 
following: 
"(A) contract payments under a production flexibility 
contract, marketing assistance loans, and any type of price 
support or payment made available under the Agricultural 
Market Transition Act, the Commodity Credit Corporation 
Charter Act (15 U.S.C. 714 et seq.), or any other Act;"; 
(B) by striking subparagraph (C); 
(C) in subparagraph (D), by striking "made under" 
and all that follows through "August 14, 1989"; 
(D) in subparagraph (E), by striking "Farmers Home 
Administration" and inserting "Consolidated Farm Service 
Agency"; and 
(E) by redesignating subparagraphs (D) and (E) as 
subparagraphs (C) and (D), respectively; and 
(3) by striking paragraph (3) and inserting the following: 
"(3) during the crop year— 
"(A) a payment made pursuant to a contract entered 
into under the environmental quality incentives program 
under chapter 4 of subtitle D; 
"(B) a payment under any other provision of subtitle 
D; 
"(C) a payment under section 401 or 402 of the Agricul-
tural Credit Act of 1978 (16 U.S.C. 2201 and 2202); or 
"(D) a payment, loan, or other assistance under section 
3 or 8 of the Watershed Protection and Flood Prevention 
Act (16 U.S.C. 1003 and 1006a).". 
SEC. 312. CONSERVATION RESERVE LANDS. 
Section 1212(a)(3) of the Food Security Act of 1985 (16 U.S.C. 
3812(a)(3)) is amended by striking "shall, if the conservation plan 
established under this subtitle for such land requires structures 
to be constructed," and inserting "shall only be required to apply 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 983 
a conservation plan established under this subtitle. The person 
shall not be required to meet a higher conservation standard than 
the standard applied to other highly erodible cropland located 
within the same area. If the person's conservation plan requires 
structures to be constructed, the person shall". 
SEC. 313. GOOD FAITH EXEMPTION. 
(a) GRACE PERIOD TO RESUME CONSERVATION COMPLIANCE.— 
Section 1212(f)(1) of the Food Security Act of 1985 (16 U.S.C. 
3812(f)(1)) is amended— 
(1) by striking "Except to the extent provided in paragraph 
(2), no" and inserting "No"; and 
(2) by striking "such person has—" and all that follows 
through the period at the end of subparagraph (B) and inserting 
the following: "the person has acted in good faith and without 
an intent to violate this subtitle. A person who meets the 
requirements of this paragraph shall be allowed a reasonable 
period of time, as determined by the Secretary, but not to 
exceed 1 year, during which to implement the measures and 
practices necessary to be considered to be actively applying 
the person's conservation plan.". 
(b) SPECIAL PENALTIES REGARDING CERTAIN HIGHLY ERODIBLE 
CROPLAND.—Section 1212(f)(2) of the Food Security Act of 1985 
(16 U.S.C. 3812(f)(2)) is amended by striking "meets the require-
ments of paragraph (1)" and inserting "with respect to highly erod-
ible cropland that was not in production prior to December 23, 
1985, and has acted in good faith and without an intent to violate 
the provisions". 
(c) CONFORMING AMENDMENT.—Section 1212(f)(4) of the Food 
Security Act of 1985 (16 U.S.C. 3812(f)(4)) is amended by striking 
the last sentence. 
SEC. 314. EXPEDITED PROCEDURES FOR GRANTING VARIANCES FROM 
CONSERVATION PLANS. 
Section 1212(f) of the Food Security Act of 1985 (16 U.S.C. 
3812(f)(4)) is amended— 
(1) in paragraph (4)(C), by striking "problem" and inserting 
"problem, including weather, pest, and disease problems"; and 
(2) by adding at the end the following: 
"(5) EXPEDITED PROCEDURES FOR TEMPORARY VARIANCES.— 
After consultation with local conservation districts, the Sec-
retary shall establish expedited procedures for the consideration 
and granting of temporary variances under paragraph (4)(C). 
If the request for a temporary variance under paragraph (4)(C) 
involves the use of practices or measures to address weather, 
pest, or disease problems, the Secretary shall make a decision 
on whether to grant the variance during the 30-day period 
beginning on the date of receipt of the request. If the Secretary 
fails to render a decision during the period, the temporary 
variance shall be considered granted.". 
SEC. 315. D E V E L O P M E N T AND IMPLEMENTATION OF CONSERVATION 
PLANS AND CONSERVATION SYSTEMS. 
(a) DEVELOPMENT AND IMPLEMENTATION.—The Food Security 
Act of 1985 is amended— 
(1) by redesignating section 1213 (16 U.S.C. 3813) as sec-
tion 1214; and 
110 STAT. 984 
PUBLIC LAW 104-127—APR. 4, 1996 
(2) by inserting after section 1212 (16 U.S.C. 3812) the 
following: 
16 use 3812a. 
"SEC. 1213. DEVELOPMENT AND IMPLEMENTATION OF CONSERVATION 
PLANS AND CONSERVATION SYSTEMS. 
"(a) TECHNICAL REQUIREMENTS.—In connection with the stand-
ards and guidelines contained in Natural Resources Conservation 
Service field office technical guides applicable to the development 
and use of conservation measures and management practices as 
part of a conservation system, the Secretary shall ensure that 
the standards and guidelines permit a person to use a conservation 
system that— 
"(1) is technically and economically feasible; 
"(2) is based on local resource conditions and available 
conservation technology; 
"(3) is cost-effective; and 
"(4) does not cause undue economic hardship on the person 
applying the conservation system under the person's conserva-
tion plan. 
"(b) MEASUREMENT OF EROSION REDUCTION.—For the purpose 
of determining whether there is a substantial reduction in soil 
erosion on a field containing highly erodible cropland, the measure-
ment of erosion reduction achieved by the application of a conserva-
tion system under a person's conservation plan shall be based 
on the estimated annual level of erosion at the time of the measure-
ment compared to the estimated annual level of erosion that existed 
before the implementation of the conservation measures and 
management practices provided for in the conservation system. 
"(c) RESIDUE MEASUREMENT.— 
"(1) RESPONSIBILITIES OF THE SECRETARY.—For the purpose 
of measuring the level of residue on a field, the Secretary 
shall— 
"(A) take into account any residue incorporated into 
the top 2 inches of soil, as well as the growing crop, 
in the measurement; 
"(B) provide technical guidelines for acceptable residue 
measurement methods; 
"(C) provide a certification system for third parties 
to perform residue measurements; and 
"(D) provide for the acceptance and use of information 
and data voluntarily provided by the producer regarding 
the field. 
"(2) ACCEPTANCE OF PRODUCER MEASUREMENTS.—^Annual 
residue measurements supplied by a producer (including 
measurements performed by a certified third party) shall be 
used by the Secretary if the Secretary determines that the 
measurements indicate that the residue level for the field meets 
the level required under the conservation plan. 
"(d) CERTIFICATION OF COMPLIANCE.— 
"(1) IN GENERAL.—For the purpose of determining the eligi-
bility of a person for program benefits specified in section 
1211 at the time application is made for the benefits, the 
Secretary shall permit the person to certify that the person 
is complying with the person's conservation plan. 
"(2) STATUS REVIEWS.—If a person makes a certification 
under paragraph (1), the Secretary shall not be required to 
carry out a review of the status of compliance of the person 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 985 
with the conservation plan under which the conservation sys-
tem is being appUed. 
"(3) REVISIONS AND MODIFICATIONS.—The Secretary shall 
permit a person who makes a certification under paragraph 
(1) with respect to a conservation plan to revise the conservation 
plan in any manner, if the same level of conservation treatment 
provided for by the conservation system under the person's 
conservation plan is maintained. The Secretary may not revise 
the person's conservation plan without the concurrence of the 
person. 
"(e) TECHNICAL ASSISTANCE.—The Secretary shall, using avail-
able resources and consistent with the Secretary's other conserva-
tion responsibilities and objectives, provide technical assistance to 
a person throughout the development, revision, and application 
of the conservation plan and any conservation system of the person. 
At the request of the person, the Secretary may provide technical 
assistance regarding conservation measures and management prac-
tices for other lands of the person that do not contain highly 
erodible cropland. 
"(f) ENCOURAGEMENT OF ON-FARM RESEARCH.—To encourage 
on-farm conservation research, the Secretary may allow a person 
to include in the person's conservation plan or a conservation system 
under the plan, on a field trial basis, practices that are not currently 
approved but that the Secretary considers have a reasonable likeli-
hood of success.". 
(b) 
TREATMENT 
OF 
TECHNICAL 
DETERMINATIONS.—Section 
226(d)(2) of the Departraent of Agriculture Reorganization Act of 
1994 (7 U.S.C. 6932(d)(2)) is amended— 
(1) by striking "DETERMINATION.—^With" and inserting 
"DETERMINATION.— 
"(A) IN GENERAL.—With"; and 
(2) by adding at the end the following: 
"(B) ECONOMIC HARDSHIP.—After a technical deter-
mination has been made, on a producer's request, if a 
county or area committee determines that the application 
of the producer's conservation system would impose an 
undue economic hardship on the producer, the committee 
shall provide the producer with relief to avoid the hard-
ship.". 
SEC. 316. INVESTIGATION OF POSSIBLE COMPLIANCE DEFICIENCIES. 
Subtitle B of title XII of the Food Security Act of 1985 (as 
amended by section 315(a)(1)) is amended by adding at the end 
the following: 
"SEC. 1215. NOTICE AND INVESTIGATION OF POSSIBLE COMPLIANCE 
16 USC 3814. 
DEFICIENCIES. 
"(a) IN GENERAL.—An employee of the Department of Agri-
culture who observes a possible compliance deficiency or other 
potential violation of a conservation plan or this subtitle while 
providing on-site technical assistance shall provide to the respon-
sible persons, not later than 45 days after observing the possible 
violation, information regarding actions needed to comply with the 
plan and this subtitle. The employee shall provide the information 
in lieu of reporting the observation as a compliance violation. 
"(b) 
CORRECTIVE ACTION.—^The responsible persons 
shall 
attempt to correct the deficiencies as soon as practicable after 
receiving the information. 
110 STAT. 986 
PUBLIC LAW 104-127—APR. 4, 1996 
"(c) REVIEW.—If the corrective action is not fully implemented 
not later than 1 year after the responsible persons receive the 
information, the Secretary may conduct a review of the status 
of compliance of the persons with the conservation plan and this 
subtitle.". 
16 use 3811 
SEC. 317. WIND EROSION ESTIMATION PILOT PROJECT. 
(a) IN GENERAL.—The Secretary of Agriculture shall conduct 
a pilot project to review, and modify as appropriate, the use of 
wind erosion factors under the highly erodible conservation require-
ments of subtitle B of title XII of the Food Security Act of 1985 
(16U.S.C. 3811etseq.). 
(b) SELECTION OF COUNTIES AND PRODUCERS.—The pilot project 
shall be conducted for producers in those counties that— 
(1) have approximately 100 percent of their cropland deter-
mined to be highly erodible under title XII of the Act; 
(2) have a reasonable likelihood that the use of wind erosion 
factors under title XII of the Act have resulted in an inequitable 
application of the highly erodible land requirements of title 
XII of the Act; and 
(3) if the use of the land classification system under section 
1201(a)(9)(A) of the Act (as redesignated by section 301(a)(1)) 
may result in a more accurate delineation of the cropland. 
(c) ERRORS IN DELINEATION.—If the Secretary determines that 
a significant error has occurred in delineating cropland under the 
pilot project, the Secretary shall, at the request of the owners 
or operators of the cropland, conduct a new delineation of the 
cropland using the most accurate available delineation process, 
as determined by the Secretary. 
Subtitle C—^Wetland Conservation 
SEC. 321. PROGRAM INELIGIBILITY. 
(a) PROGRAM INELIGIBILITY.—Section 1221 of the Food Security 
Act of 1985 (16 U.S.C. 3821) is amended— 
(1) by redesignating subsection (b) as subsection (c); and 
(2) by striking the section heading and all that follows 
through the end of subsection (a) and inserting the following: 
"SEC. 1221. PROGRAM INELIGIBILITY. 
"(a) PRODUCTION ON CONVERTED WETLAND.—Except as pro-
vided in this subtitle and notwithstanding any other provision 
of law, any person who in any crop year produces an agricultural 
commodity on converted wetland, as determined by the Secretary, 
shall be— 
"(1) in violation of this section; and 
"(2) ineligible for loans or payments in an amount deter-
mined by the Secretary to be proportionate to the severity 
of the violation. 
"(b) INELIGIBILITY FOR CERTAIN LOANS AND PAYMENTS.—If a 
person is determined to have committed a violation under subsection 
(a) during a crop year, the Secretary shall determine which of, 
and the amount of, the following loans and payments for which 
the person shall be ineligible: 
"(1) Contract payments under a production flexibility con-
tract, marketing assistance loans, and any type of price support 
or payment made available under the Agricultural Market 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 987 
Transition Act, the Commodity Credit Corporation Charter Act 
(15 U.S.C. 714 et seq.), or any other Act. 
"(2) A loan made or guaranteed under the ConsoHdated 
Farm and Rural Development Act (7 U.S.C. 1921 et seq.) or 
any other provision of law administered by the Consolidated 
Farm Service Agency, if the Secretary determines that the 
proceeds of the loan will be used for a purpose that will contrib-
ute to conversion of a wetland (other than as provided in 
this subtitle) to produce an agricultural commodity. 
"(3) During the crop year: 
"(A) A payment made pursuant to a contract entered 
into under the environmental quality incentives program 
under chapter 4 of subtitle D. 
"(B) A payment under any other provision of subtitle 
D. 
"(C) A payment under section 401 or 402 of the Agricul-
tural Credit Act of 1978 (16 U.S.C. 2201 and 2202). 
"(D) A payment, loan, or other assistance under section 
3 or 8 of the Watershed Protection and Flood Prevention 
Act (16 U.S.C. 1003 and 1006a).". 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1221(c) of the Food Security Act of 1985 (as 
redesignated by subsection (a)(1)) is amended— 
16 USC 3821. 
(A) by striking "Except" and inserting "WETLAND 
CONVERSION.—Except"; 
(B) by striking "subsequent to the date of enactment 
of the Food, Agriculture, Conservation, and Trade Act of 
1990" and inserting "beginning after November 28, 1990,"; 
and 
(C) by striking "subsections (a) (1) through (3)" and 
inserting "subsection (b)". 
(2) Section 1221 of the Food Security Act of 1985 (as 
amended by subsection (a)) is amended by adding at the end 
the following: 
"(d) PRIOR LOANS.—This section shall not apply to a loan 
described in subsection (b) made before December 23, 1985.". 
SEC. 322. DELINEATION OF WETLANDS; EXEMPTIONS TO PROGRAM 
INELIGIBILITY. 
(a) DELINEATION OF WETLANDS.—Section 1222 of the Food Secu-
rity Act of 1985 (16 U.S.C. 3822) is amended by striking subsection 
(a) and inserting the following: 
"(a) DELINEATION BY THE SECRETARY.— 
"(1) IN GENERAL.—Subject to subsection (b) and paragraph 
(6), the Secretary shall delineate, determine, and certify all 
wetlands located on subject land on a farm. 
"(2) WETLAND DELINEATION MAPS.—The Secretary shall 
delineate wetlands on wetland delineation maps. On the request 
of a person, the Secretary shall make a reasonable effort to 
make an on-site wetland determination prior to delineation. 
"(3) CERTIFICATION.—On providing notice to affected per-
sons, the Secretary shall— 
"(A) certify whether a map is sufficient for the purpose 
of making a determination of ineligibility for program bene-
fits under section 1221; and 
"(B) provide an opportunity to appeal the certification 
prior to the certification becoming final. 
110 STAT. 988 
PUBLIC LAW 104-127—APR. 4, 1996 
"(4) DURATION OF CERTIFICATION.—^A final certification 
made under paragraph (3) shall remain valid and in effect 
as long as the area is devoted to an agricultural use or until 
such time as the person affected by the certification requests 
review of the certification by the Secretary. 
"(5) REVIEW OF MAPPING ON APPEAL.—In the case of an 
appeal of the Secretary's certification, the Secretary shall 
review and certify the accuracy of the mapping of all land 
subject to the appeal to ensure that the subject land has been 
accurately delineated. Prior to rendering a decision on the 
appeal, the Secretary shall conduct an on-site inspection of 
the subject land on a farm. 
"(6) RELIANCE ON PRIOR CERTIFIED DELINEATION.—No per-
son shall be adversely affected because of having taken an 
action based on a previous certified wetland delineation by 
the Secretary. The delineation shall not be subject to a subse-
quent wetland certification or delineation by the Secretary, 
unless requested by the person under paragraph (4).". 
(b) EXEMPTIONS.—Section 1222 of the Food Security Act of 
1985 (16 U.S.C. 3822) is amended by striking subsection (b) and 
inserting the following: 
"(b) EXEMPTIONS.—No person shall become ineligible under sec-
tion 1221 for program loans or payments under the following cir-
cumstances: 
"(1) As the result of the production of an agricultural 
commodity on the following lands: 
"(A) A converted wetland if the conversion of the wet-
land was commenced before December 23, 1985. 
"(B) Land that is a nontidal drainage or irrigation 
ditch excavated in upland. 
"(C) A wet area created by a water delivery system, 
irrigation, irrigation system, or application of water for 
irrigation. 
"(D) A wetland on which the owner or operator of 
a farm or ranch uses normal cropping or ranching practices 
to produce an agricultural commodity in a manner that 
is consistent for the area where the production is possible 
as a result of a natural condition, such as drought, and 
is without action by the producer that destroys a natural 
wetland characteristic. 
"(E) Land that is an artificial lake or pond created 
by excavating or diking land (that is not a wetland) to 
collect and retain water and that is used primarily for 
livestock watering, fish production, irrigation, wildlife, fire 
control, flood control, cranberry growing, or rice production, 
or as a settling pond. 
"(F) A wetland that is temporarily or incidentally cre-
ated as a result of adjacent development activity. 
"(G) A converted wetland if the original conversion 
of the wetland was commenced before December 23, 1985, 
and the Secretary determines the wetland characteristics 
returned after that date as a result of— 
"(i) the lack of maintenance of drainage, dikes, 
levees, or similar structures; 
"(ii) a lack of management of the lands containing 
the wetland: or 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 989 
"(iii) circumstances beyond the control of the per-
son. 
"(H) A converted wetland, if— 
"(i) the converted wetland was determined by the 
Natural Resources Conservation Service to have been 
manipulated for the production of an agricultural 
commodity or forage prior to December 23, 1985, and 
was returned to wetland conditions through a vol-
untary restoration, enhancement, or creation action 
subsequent to that determination; 
"(ii) technical determinations regarding the prior 
site conditions and the restoration, enhancement, or 
creation action have been adequately documented by 
the Natural Resources Conservation Service; 
"(iii) the proposed conversion action is approved 
by the Natural Resources Conservation Service prior 
to implementation; and 
"(iv) the extent of the proposed conversion is lim-
ited so that the conditions will be at least equivalent 
to the wetland functions and values that existed prior 
to implementation of the voluntary wetland restora-
tion, enhancement, or creation action. 
"(2) For the conversion of the following: 
"(A) An artificial lake or pond created by excavating 
or diking land that is not a wetland to collect and retain 
water and that is used primarily for livestock watering, 
fish production, irrigation, wildlife, fire control, flood con-
trol, cranberry growing, rice production, or as a settling 
pond. 
"(B) A wetland that is temporarily or incidentally cre-
ated as a result of adjacent development activity. 
"(C) A wetland on which the owner or operator of 
a farm or ranch uses normal cropping or ranching practices 
to produce an agricultural commodity in a manner that 
is consistent for the area where the production is possible 
as a result of a natural condition, such as drought, and 
is without action by the producer that destroys a natural 
wetland characteristic. 
"(D) A wetland previously identified as a converted 
wetland (if the original conversion of the wetland was 
commenced before December 23, 1985), but that the Sec-
retary determines returned to wetland status after that 
date as a result of— 
"(i) the lack of maintenance of drainage, dikes, 
levees, or similar structures; 
"(ii) a lack of management of the lands containing 
the wetland; or 
"(iii) circumstances beyond the control of the per-
son. 
"(E) A wetland, if— 
"(i) the wetland was determined by the Natural 
Resources Conservation Service to have been manipu-
lated for the production of an agricultural commodity 
or forage prior to December 23, 1985, and was returned 
to wetland conditions through a voluntary restoration, 
enhancement, or creation action subsequent to that 
determination; 
110 STAT. 990 
PUBLIC LAW 104-127—APR. 4, 1996 
"(ii) technical determinations regarding the prior 
site conditions and the restoration, enhancement, or 
creation action have been adequately documented by 
the Natural Resources Conservation Service; 
"(iii) the proposed conversion action is approved 
by the Natural Resources Conservation Service prior 
to implementation; and 
"(iv) the extent of the proposed conversion is lim-
ited so that the conditions will be at least equivalent 
to the wetland functions and values that existed prior 
to implementation of the voluntary wetland restora-
tion, enhancement, or creation action.". 
(c) IDENTIFICATION OF MINIMAL EFFECT EXEMPTIONS.—Section 
1222 of the Food Security Act of 1985 (16 U.S.C. 3822) is amended 
by striking subsection (d) and inserting the following: 
"(d) 
IDENTIFICATION OF MINIMAL EFFECT EXEMPTIONS.—For 
purposes of applying the minimal effect exemption under subsection 
(f)(1), the Secretary shall identify by regulation categorical minimal 
effect exemptions on a regional basis to assist persons in avoiding 
a violation of the ineligibility provisions of section 1221. The Sec-
retary shall ensure that employees of the Department of Agriculture 
who administer this subtitle receive appropriate training to properly 
apply the minimal effect exemptions determined by the Secretary.". 
(d) MINIMAL EFFECT AND MITIGATION EXEMPTIONS.—Section 
1222 of the Food Security Act of 1985 (16 U.S.C. 3822) is amended 
by striking subsection (f) and inserting the following: 
"(f) MINIMAL EFFECT; MITIGATION.—The Secretary shall exempt 
a person from the ineligibility provisions of section 1221 for any 
action associated with the production of an agricultural commodity 
on a converted wetland, or the conversion of a wetland, if 1 or 
more of the following conditions apply, as determined by the Sec-
retary: 
"(1) The action, individually and in connection with all 
other similar actions authorized by the Secretary in the area, 
will have a minimal effect on the functional hydrological and 
biological value of the wetlands in the area, including the 
value to waterfowl and wildlife. 
"(2) The wetland and the wetland values, acreage, and 
functions are mitigated by the person through the restoration 
of a converted wetland, the enhancement of an existing wetland, 
or the creation of a new wetland, and the restoration, enhance-
ment, or creation is— 
"(A) in accordance with a wetland conservation plan; 
"(B) in advance of, or concurrent with, the action; 
"(C) not at the expense of the Federal Government; 
"(D) in the case of enhancement or restoration of wet-
lands, on not greater than a 1-for-l acreage basis unless 
more acreage is needed to provide equivalent functions 
and values that will be lost as a result of the wetland 
conversion to be mitigated; 
"(E) in the case of creation of wetlands, on greater 
than a 1-for-l acreage basis if more acreage is needed 
to provide equivalent functions and values that will be 
lost as a result of the wetland conversion that is mitigated; 
"(F) on lands in the same general area of the local 
watershed as the converted wetland; and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 991 
"(G) with respect to the restored, enhanced, or created 
wetland, made subject to an easement that— 
"(i) is recorded on public land records; 
"(ii) remains in force for as long as the converted 
wetland for which the restoration, enhancement, or 
creation to be mitigated remains in agricultural use 
or is not returned to its original wetland classification 
with equivalent functions and values; and 
"(iii) prohibits making alterations to the restored, 
enhanced, or created wetland that lower the wetland's 
functions and values. 
"(3) The wetland was converted after December 23, 1985, 
but before November 28, 1990, and the wetland values, acreage, 
and functions are mitigated by the producer through the 
requirements of subparagraphs (A), (B), (C), (D), (F), and (G) 
of paragraph (2). 
"(4) The action was authorized by a permit issued under 
section 404 of the Federal Water Pollution Control Act (33 
U.S.C. 1344) and the wetland values, acreage, and functions 
of the converted wetland were adequately mitigated for the 
purposes of this subtitle.". 
(e) REFERENCES TO PRODUCER.—Section 1222(g) of the Food 
Security Act of 1985 (16 U.S.C. 3822(g)) is amended by striking 
"producer" and inserting "person". 
(f) GOOD FAITH EXEMPTION.—Section 1222 of the Food Security 
Act of 1985 (16 U.S.C. 3822) is amended by striking subsection 
(h) and inserting the following: 
"(h) GOOD FAITH EXEMPTION.— 
"(1) EXEMPTION DESCRIBED.—The Secretary may waive a 
person's ineligibility under section 1221 for program loans, 
payments, and benefits as the result of the conversion of a 
wetland subsequent to November 28, 1990, or the production 
of an agricultural commodity on a converted wetland, if the 
Secretary determines that the person has acted in good faith 
and without intent to violate this subtitle. 
"(2) PERIOD FOR COMPLIANCE.—The Secretary shall provide 
a person who the Secretary determines has acted in good faith 
and without intent to violate this subtitle with a reasonable 
period, but not to exceed 1 year, during which to implement 
the measures and practices necessary to be considered to 
actively restoring the subject wetland.". 
(g) RESTORATION.—Section 1222(i) of the Food Security Act 
of 1985 (16 U.S.C. 3822(i)) is amended by inserting before the 
period at the end the following: "or has otherwise mitigated for 
the loss of wetland values, as determined by the Secretary, through 
the restoration, enhancement, or creation of wetland values in 
the same general area of the local watershed as the converted 
wetland". 
(h) DETERMINATIONS.—Section 1222 of the Food Security Act 
of 1985 (16 U.S.C. 3822) is amended by striking subsection (j) 
and inserting the following: 
"(j) DETERMINATIONS; RESTORATION AND MITIGATION PLANS; 
MONITORING ACTIVITIES.—Technical determinations, the develop-
ment of restoration and mitigation plans, and monitoring activities 
under this section shall be made by the National Resources Con-
servation Service.". 
110 STAT. 992 
PUBLIC LAW 104-127—APR. 4, 1996 
(i) MITIGATION BANKING.—Section 1222 of the Food Security 
Act, of 1985 (16 U.S.C. 3822) is amended by adding at the end 
the following: 
"(k) MITIGATION BANKING PROGRAM.—Using authorities avail-
able to the Secretary, the Secretary may operate a pilot program 
for mitigation banking of wetlands to assist persons to increase 
the efficiency of agricultural operations while protecting wetland 
functions and values. Subsection (f)(2)(C) shall not apply to this 
subsection.". 
SEC. 
323. 
CONSULTATION 
AND 
COOPERATION 
REQUIREMENTS. 
Section 1223 of the Food Security Act of 1985 (16 U.S.C. 3823) 
is repealed. 
SEC. 324. APPLICATION OF PROGRAM INELIGIBILITY TO AFFILIATED 
PERSONS. 
The Food Security Act of 1985 (as amended by section 323) 
is amended by inserting after section 1222 (16 U.S.C. 3822) the 
following: 
16 u s e 3823. 
"SEC. 1223. AFFILIATED PERSONS. 
"If a person is affected by a reduction in benefits under section 
1221 and the affected person is affiliated with other persons for 
the purpose of receiving the benefits, the benefits of each affiliated 
person shall be reduced under section 1221 in proportion to the 
interest held by the affiliated person.". 
SEC. 325. CLARIFICATION OF DEFINITION OF AGRICULTURAL LANDS 
IN MEMORANDUM OF AGREEMENT. 
(a) AGRICULTURAL LANDS.—For purposes of implementing the 
memorandum of agreement entered into between the Department 
of Agriculture, the Environmental Protection Agency, the Depart-
ment of the Interior, and the Department of the Army on January 
6, 1994, relating to the delineation of wetlands, the term "agricul-
tural lands" shall include— 
(1) native pasture, rangelands, and other lands used to 
produce or support the production of livestock; and 
(2) tree farms. 
(b) WETLAND CONSERVATION.—Subsection (a) shall not apply 
with respect to the delineation of wetlands under subtitle C of 
title XII of the Food Security Act of 1985 (16 U.S.C. 3821 et 
seq.) or to the enforcement of the subtitle. 
(c) SUCCESSOR MEMORANDUM.—Subsection (a) shall apply to 
any amendment to or successor of the memorandum of agreement 
described in subsection (a). 
16 u s e 3821 
SEC. 326. EFFECTIVE DATE. 
This subtitle and the amendments made by this subtitle shall 
become effective 90 days after the date of enactment of this Act. 
Subtitle D—Environmental Conservation 
Acreage Reserve Program 
SEC. 331. E N V I R O N M E N T A L CONSERVATION ACREAGE RESERVE PRO-
GRAM. 
Section 1230 of the Food Security Act of 1985 (16 U.S.C. 3830) 
is amended to read as follows: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 993 
"SEC. 1230. ENVIRONMENTAL CONSERVATION ACREAGE RESERVE 
PROGRAM. 
"(a) ESTABLISHMENT.— 
"(1) IN GENERAL.—During the 1996 through 2002 calendar 
years, the Secretary shall establish an environmental conserva-
tion acreage reserve program (referred to in this section as 
'ECARP') to be implemented through contracts and the acquisi-
tion of easements to assist owners and operators of farms 
and ranches to conserve and enhance soil, water, and related 
natural resources, including grazing land, wetland, and wildlife 
habitat. 
"(2) MEANS.—The Secretary shall carry out the ECARP 
b y -
"(A) providing for the long-term protection of environ-
mentally sensitive land; and 
"(B) providing technical and financial assistance to 
farmers and ranchers to— 
"(i) improve the management and operation of the 
farms and ranches; and 
"(ii) reconcile productivity and profitability with 
protection and enhancement of the environment. 
"(3) PROGRAMS.—The ECARP shall consist of— 
"(A) the conservation reserve program established 
under subchapter B; 
"(B) the wetlands reserve program established under 
subchapter C; and 
"(C) the environmental quality incentives program 
established under chapter 4. 
"(b) ADMINISTRATION.— 
"(1) IN GENERAL.—In carrying out the ECARP, the Sec- Contracts, 
retary shall enter into contracts with owners and operators 
and acquire interests in land through easements from owners, 
as provided in this chapter and chapter 4. 
"(2) PRIOR ENROLLMENTS.—^Acreage enrolled in the con-
servation reserve or wetlands reserve program prior to the 
date of enactment of this paragraph shall be considered to 
be placed into the ECARP. 
"(c) CONSERVATION PRIORITY AREAS.— 
"(1) DESIGNATION.—^The Secretary may designate water-
sheds, multistate areas, or regions of special environmental 
sensitivity as conser-vation priority areas that are eligible for 
enhanced assistance under this chapter and chapter 4. 
"(2) ASSISTANCE.—^The Secretary may designate areas as 
conservation priority areas to assist, to the maximum extent 
practicable, agricultural producers within the conservation 
priority areas to comply with nonpoint source pollution require-
ments under the Federal Water Pollution Control Act (33 U.S.C. 
1251 et seq.) and other Federal and State environmental laws 
and to meet other conservation needs. 
"(3) PRODUCERS.—^The Secretary may provide technical 
assistance, cost-share payments, and incentive payments to 
producers in a conservation priority area under this chapter 
and chapter 4 based on— 
"(A) the significance of the soil, water, wildlife habitat, 
and related natural resource problems in a watershed, 
multistate area, or region; and 
110 STAT. 994 
PUBLIC LAW 104-127—APR. 4, 1996 
"(B) the structural practices or land management prac-
tices that best address the problems, and that maximize 
environmental benefits for each dollar expended, as deter-
mined by the Secretary.". 
SEC. 332. CONSERVATION RESERVE PROGRAM. 
(a) PROGRAM EXTENSIONS.— 
(1) CONSERVATION RESERVE PROGRAM.—Section 1231 of the 
Food Security Act of 1985 (16 U.S.C. 3831) is amended by 
striking "1995" each place it appears and inserting "2002". 
(2) DUTIES OF OWNERS AND OPERATORS.—Section 1232(c) 
of the Food Security Act of 1985 (16 U.S.C. 3832(c)) is amended 
by striking "1995" and inserting "2002". 
(b) MAXIMUM ENROLLMENT.—Section 1231 of the Food Security 
Act of 1985 (16 U.S.C. 3831) is amended by striking subsection 
(d) and inserting the following: 
"(d) MAXIMUM ENROLLMENT.—^The Secretary may maintain up 
to 36,400,000 acres in the conservation reserve at any one time 
during the 1986 through 2002 calendar years (including contracts 
extended by the Secretary pursuant to section 1437(c) of the Food, 
Agriculture, Conservation, and Trade Act of 1990 (Public Law 101-
624; 16 U.S.C. 3831 note)).". 
(c) OPTIONAL CONTRACT TERMINATION BY PRODUCERS.—Section 
1235 of the Food Security Act of 1985 (16 U.S.C. 3835) is amended— 
(1) in subsection (a)— 
(A) in paragraph (1), by striking "3-year" and inserting 
"1-year"; and 
(B) in paragraph (2)(B)(i), by striking "3 years" and 
inserting "1 year"; and 
(2) by adding at the end the following: 
"(e) TERMINATION BY OWNER OR OPERATOR.— 
"(1) EARLY TERMINATION AUTHORIZED.—Subject to the other 
provisions of this subsection, the Secretary shall allow a partici-
pant who entered into a contract before January 1, 1995, to 
terminate the contract at any time if the contract has been 
in effect for at least 5 years. The termination shall not relieve 
the participant of liability for a contract violation occurring 
before the date of the termination. The participant shall provide 
the Secretary with reasonable notice of the participant's desire 
to terminate the contract. 
"(2) CERTAIN LANDS EXCEPTED.—^The following lands shall 
not be subject to an early termination of contract under this 
subsection: 
"(A) Filterstrips, waterways, strips adjacent to riparian 
areas, windbreaks, and shelterbelts. 
"(B) Land with an erodibility index of more than 15. 
"(C) Other lands of high environmental value (includ-
ing wetlands), as determined by the Secretary. 
"(3) EFFECTIVE 
DATE.—^The contract termination 
shall 
become effective 60 days after the date on which the owner 
or operator submits the notice required under paragraph (1). 
"(4) PRORATED RENTAL PAYMENT.—If a contract entered 
into under this subchapter is terminated under this subsection 
before the end of the fiscal year for which a rental payment 
is due, the Secretary shall provide a prorated rental payment 
covering the portion of the fiscal year during which the contract 
was in effect. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 995 
"(5) IlENEWED ENROLLMENT.—^The termination of a contract 
entered into under this subchapter shall not affect the ability 
of the owner or operator who requested the termination to 
submit a subsequent bid to enroll the land that was subject 
to the contract into the conservation reserve. 
"(6) CONSERVATION REQUIREMENTS.—If land that was sub-
ject to a contract is returned to production of an agricultural 
commodity, the conservation requirements under subtitles B 
and C shall apply to the use of the land to the extent that 
the requirements are similar to those requirements imposed 
on other similar lands in the area, except that the requirements 
may not be more onerous than the requirements imposed on 
other lands.", 
(d) ENROLLMENTS IN 1997.—Section 725 of the Agriculture, 
Rural Development, Food and Drug Administration, and Related 
Agencies Appropriations Act, 1996 (Public Law 104-37; 109 Stat. 
332), is amended by striking ": Provided" 
and all that follows 
through "1997". 
SEC. 333. WETLANDS RESERVE PROGRAM. 
(a) ENROLLMENT.—Section 1237 of the Food Security Act of 
1985 (16 U.S.C. 3837) is amended by striking subsection (b) and 
inserting the following: 
"(b) ENROLLMENT CONDITIONS.— 
"(1) MAXIMUM ENROLLMENT.—The total number of acres 
enrolled in the wetlands reserve program shall not exceed 
975,000 acres. 
"(2) METHODS OF ENROLLMENT.— 
"(A) IN GENERAL.—Subject to subparagraph (B), effec-
tive beginning October 1, 1996, to the maximum extent 
practicable, the Secretary shall enroll into the wetlands 
reserve program— 
"(i) V
a of the acres through the use of permanent 
easements; 
"(ii) Vs of the acres through the use of 30-year 
easements; and 
"(iii) Va of the acres through the use of restoration 
cost-share agreements. 
"(B) 
TEMPORARY 
EASEMENTS.—Effective 
beginning 
October 1, 1996, the Secretary shall not enroll acres in 
the wetlands reserve program through the use of new 
permanent easements until the Secretary has enrolled at 
least 75,000 acres in the program through the use of tem-
porary easements.". 
(b) ELIGIBILITY.—Section 1237(c) of the Food Security Act of 
1985 (16 U.S.C. 3837(c)) is amended— 
(1) by striking "2000" and inserting "2002"; 
(2) by redesignating paragraphs (1) and (2) as paragraphs 
(2) and (3), respectively; and 
(3) by inserting after "determines that—" the following: 
"(1) such land maximizes wildlife benefits and wetland 
values and functions;". 
(c) OTHER ELIGIBLE LANDS.—Section 1237(d) of the Food Secu-
rity Act of 1985 (16 U.S.C. 3837(d)) is amended— 
(1) by inserting after "subsection (c)" the following ", land 
that maximizes wildlife benefits and that is"; and 
110 STAT. 996 
PUBLIC LAW 104-127—APR. 4, 1996 
(2) in paragraph (2), by striking "and" at the end and 
inserting "or". 
(d) EASEMENTS.—Section 1237A of the Food Security Act of 
1985 (16 U.S.C. 3837a) is amended— 
(1) in the section heading, by inserting before the period 
at the end the following: "AND AGREEMENTS"; 
(2) by striking subsection (c) and inserting the following: 
"(c) RESTORATION PLANS.—The development of a restoration 
plan, including any compatible use, under this section shall be 
made through the local Natural Resources Conservation Service 
representative, in consultation with the State technical committee."; 
(3) in subsection (f), by striking the third sentence and 
inserting the following: "Compensation may be provided in 
not less than 5, nor more than 30, annual payments of equal 
or unequal size, as agreed to by the owner and the Secretary."; 
and 
(4) by adding at the end the following: 
"(h) RESTORATION COST-SHARE AGREEMENTS.—The Secretary 
may enroll land into the wetlands reserve program through an 
agreement that requires the landowner to restore wetlands on the 
land, if the agreement does not provide the Secretary with an 
easement.". 
(e) COST-SHARE AND TECHNICAL ASSISTANCE.—Section 1237C 
of the Food Security Act of 1985 (16 U.S.C. 3837c) is amended 
by striking subsection (b) and inserting the following: 
"(b) COST-SHARE AND TECHNICAL ASSISTANCE.— 
Effective date. 
"(1) EASEMENTS.—Effective beginning October 1, 1996, in 
making cost-share payments under subsection (a)(1), the Sec-
retary shall— 
"(A) in the case of a permanent easement, pay the 
owner an amount that is not less than 75 percent, but 
not more than 100 percent, of the eligible costs; and 
"(B) in the case of a 30-year easement, pay the owner 
an amount that is not less than 50 percent, but not more 
than 75 percent, of the eligible costs. 
"(2) RESTORATION COST-SHARE AGREEMENTS.—In making 
cost-share payments in connection with a restoration cost-share 
agreement entered into under section 1237A(h), the Secretary 
shall pay the owner an amount that is not less than 50 percent, 
but not more than 75 percent, of the eligible costs. 
"(3) TECHNICAL ASSISTANCE.—^The Secretary shall provide 
owners with technical assistance to assist owners in complying 
with the terms of easements and restoration cost-share agree-
ments.". 
16 use 3837 
(f) EFFECT ON EXISTING AGREEMENTS.—The amendments made 
note. 
by this section shall not affect the validity or terms of any agree-
ments entered into by the Secretary of Agriculture under subchapter 
C of chapter 1 of subtitle D of title XII of the Food Security 
Act of 1985 (16 U.S.C. 3837 et seq.) before the date of enactment 
of this Act or any payments required to be made in connection 
with the agreements. 
SEC. 334. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM. 
Subtitle D of title XII of the Food Security Act of 1985 (16 
U.S.C. 3830 et seq.) is amended by adding at the end the following: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 997 
"CHAPTER 4—ENVIRONMENTAL QUALITY INCENTIVES 
PROGRAM 
"SEC. 1240. PURPOSES. 
16 USC 3839aa. 
"The purposes of the environmental quality incentives program 
established by this chapter are to— 
"(1) combine into a single program the functions of— 
"(A) the agricultural conservation program authorized 
by sections 7 and 8 of the Soil Conservation and Domestic 
Allotment Act (16 U.S.C. 590g and 590h) (as in effect 
before the amendments made by section 336(a)(1) of the 
Federal Agriculture Improvement and Reform Act of 1996); 
"(B) the Great Plains conservation program established 
under section 16rb) of the Soil Conservation and Domestic 
Allotment Act (16 U.S.C. 590p(b)) (as in effect before the 
amendment made by section 336(b)(1) of the Federal Agri-
culture Improvement and Reform Act of 1996); 
"(C) the water quality incentives program established 
under chapter 2 (as in effect before the amendment made 
by section 336(h) of the Federal Agriculture Improvement 
and Reform Act of 1996); and 
"(D) the Colorado River Basin salinity control program 
established under section 202(c) of the Colorado River Basin 
Salinity Control Act (43 U.S.C. 1592(c)) (as in effect before 
the amendment made by section 336(c)(1) of the Federal 
Agriculture Improvement and Reform Act of 1996); and 
"(2) carry out the single program in a manner that maxi-
mizes environmental benefits per dollar expended, and that 
provides— 
"(A) flexible technical and financial assistance to farm-
ers and ranchers that face the most serious threats to 
soil, water, and related natural resources, including grazing 
lands, wetlands, and wildlife habitat; 
"(B) assistance to farmers and ranchers in complying 
with this title and Federal and State environmental laws, 
and encourages environmental enhancement; 
"(C) assistance to farmers and ranchers in making 
beneficial, cost-effective changes to cropping systems, graz-
ing management, manure, nutrient, pest, or irrigation 
management, land uses, or other measures needed to con-
serve and improve soil, water, and related 
natural 
resources; and 
"(D) for the consolidation and simplification of the con-
servation planning process to reduce administrative bur-
dens on producers. 
"SEC. 1240A. DEFINITIONS. 
16 USC 
«T 
4.U- 
u 
4- 
3839aa-l. 
In this chapter: 
"(1) ELIGIBLE LAND.—The term 'eligible land' means agri-
cultural land (including cropland, rangeland, pasture, and other 
land on which crops or livestock are produced), including agri-
cultural land that the Secretary determines poses a serious 
threat to soil, water, or related resources by reason of the 
soil types, terrain, climatic, soil, topographic, flood, or saline 
characteristics, or other factors or natural hazards. 
"(2) 
LAND 
MANAGEMENT 
PRACTICE.—The 
term 
'land 
management practice' means a site-specific nutrient or manure 
110 STAT. 998 
PUBLIC LAW 104-127—APR. 4, 1996 
management, integrated pest management, irrigation manage-
ment, tillage or residue management, grazing management, 
or other land management practice carried out on eligible land 
that the Secret?iry determines is needed to protect, in the 
most cost-effective manner, water, soil, or related resources 
from degradation. 
"(3) LIVESTOCK.—The term 'livestock' means dairy cattle, 
beef cattle, laying hens, broilers, turkeys, swine, sheep, and 
such other animals as determined by the Secretary. 
"(4) PRODUCER.—The term 'producer' means a person who 
is engaged in livestock or agricultural production (as defined 
by the Secretary). 
"(5) STRUCTURAL PRACTICE.—The term 'structural practice' 
means— 
"(A) the establishment on eligible land of a site-specific 
animal waste management facility, terrace, grassed water-
way, contour grass strip, filterstrip, tailwater pit, perma-
nent wildlife habitat, or other structural practice that the 
Secretary determines is needed to protect, in the most 
cost-effective manner, water, soil, or related resources from 
degradation; and 
"(B) the capping of abandoned wells on eligible land. 
16 u s e 
"SEC. 1240B. ESTABLISHMENT AND ADMINISTRATION OF ENVIRON-
3839aa-2. 
MENTAL QUALITY INCENTIVES PROGRAM. 
"(a) ESTABLISHMENT.— 
"(1) IN GENERAL.—During the 1996 through 2002 fiscal 
years, the Secretary shall provide technical assistance, cost-
share payments, incentive payments, and education to produc-
ers, who enter into contracts with the Secretary, through an 
environmental quality incentives program in accordance with 
this chapter. 
"(2) ELIGIBLE PRACTICES.— 
"(A) STRUCTURAL PRACTICES.—^A producer who imple-
ments a structural practice shall be eligible for any com-
bination of technical assistance, cost-share payments, and 
education. 
"(B) LAND MANAGEMENT PRACTICES.—^A producer who 
performs a land management practice shall be eligible for 
any combination of technical assistance, incentive pay-
ments, and education. 
"(b) APPLICATION AND TERM.—^A contract between a producer 
and the Secretary under this chapter may— 
"(1) apply to 1 or more structural practices or 1 or more 
land management practices, or both; and 
"(2) have a term of not less than 5, nor more than 10, 
years, as determined appropriate by the Secretary, depending 
on the practice or practices that are the basis of the contract. 
"(c) STRUCTURAL PRACTICES.— 
"(1) OFFER SELECTION PROCESS.—The Secretary shall, to 
the maximum extent practicable, establish a process for select-
ing applications for financial assistance if there are numerous 
applications for assistance for structural practices that would 
provide substantially the same level of environmental benefits. 
The process shall be based on— 
"(A) a reasonable estimate of the projected cost of 
the proposals and other factors identified by the Secretary 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 999 
for determining which appUcations will result in the least 
cost to the program authorized by this chapter; and 
"(B) the priorities established under this subtitle and 
such other factors determined by the Secretary that maxi-
mize environmental benefits per dollar expended. 
"(2) CONCURRENCE OF OWNER.—If the producer making 
an offer to implement a structural practice is a tenant of 
the land involved in agricultural production, for the offer to 
be acceptable, the producer shall obtain the concurrence of 
the owner of the land with respect to the offer. 
"(d) LAND MANAGEMENT PRACTICES.—The Secretary shall estab-
lish an application and evaluation process for awarding technical 
assistance or incentive payments, or both, to a producer in exchange 
for the performance of 1 or more land management practices by 
the producer. 
"(e) COST-SHARE PAYMENTS, INCENTIVE PAYMENTS, AND TECH-
NICAL ASSISTANCE.— 
"(1) COST-SHARE PAYMENTS.— 
"(A) IN GENERAL.—The Federal share of cost-share pay-
ments to a producer proposing to implement 1 or more 
structural practices shall be not more than 75 percent 
of the projected cost of the practice, as determined by 
the Secretary, taking into consideration any payment 
received by the producer from a State or local government. 
"(B) LIMITATION.—^A producer who owns or operates 
a large confined livestock operation (as defined by the 
Secretary) shall not be eligible for cost-share payments 
to construct an animal waste management facility. 
"(C) 
OTHER 
PAYMENTS.—^A producer shall not be 
eligible for cost-share payments for structural practices 
on eligible land under this chapter if the producer receives 
cost-share payments or other benefits for the same land 
under chapter 1 or 3. 
"(2) INCENTIVE PAYMENTS.—^The Secretary shall make 
incentive payments in an amount and at a rate determined 
by the Secretary to be necessary to encourage a producer to 
perform 1 or more land management practices. 
"(3) TECHNICAL ASSISTANCE.— 
"(A) FUNDING.—^The Secretary shall allocate funding 
under this chapter for the provision of technical assistance 
according to the purpose and projected cost for which the 
technical assistance is provided for a fiscal year. The allo-
cated amount may vary according to the type of expertise 
required, quantity of time involved, and other factors as 
determined appropriate by the Secretary. Funding shall 
not exceed the projected cost to the Secretary of the tech-
nical assistance provided for a fiscal year. 
"(B) OTHER AUTHORITIES.—The receipt of technical 
assistance under this chapter shall not affect the eligibility 
of the producer to receive technical assistance under other 
authorities of law available to the Secretary. 
"(C) PRIVATE SOURCES.—The Secretary shall ensure 
that the processes of writing and developing proposals and 
plans for contracts under this chapter, and of assisting 
in the implementation of structural practices and land 
management practices covered by the contracts, are open 
to individuals in agribusiness, including 
agricultural 
110 STAT. 1000 
PUBLIC LAW 104-127—APR. 4, 1996 
16 use 
3839aa-3. 
16 use 
3839aa-4. 
producers, representatives from agricultural cooperatives, 
agricultural input retail dealers, and certified crop advisers. 
The requirements of this subparagraph shall also apply 
to any other conservation program of the Department of 
Agriculture that provides incentive payments, technical 
assistance, or cost-share payments. 
"(0 MODIFICATION OR TERMINATION OF CONTRACTS.— 
"(1) VOLUNTARY MODIFICATION OR TERMINATION.—The Sec-
retary may modify or terminate a contract entered into with 
a producer under this chapter i
f
— 
"(A) the producer agrees to the modification or termi-
nation; and 
"(B) the Secretary determines that the modification 
or termination is in the public interest. 
"(2) 
INVOLUNTARY 
TERMINATION.—The 
Secretary 
may 
terminate a contract under this chapter if the Secretary deter-
mines that the producer violated the contract. 
"(g) NON-FEDERAL ASSISTANCE.—The Secretary may request 
the services of a State water quality agency. State fish and wildlife 
agency. State forestry agency, or any other governmental or private 
resource considered appropriate to assist in providing the technical 
assistance necessary for the development and implementation of 
a structural practice or land management practice. 
"SEC. 1240C. EVALUATION OF OFFERS AND PAYMENTS. 
"In providing technical assistance, cost-share payments, and 
incentive payments to producers, the Secretary shall accord a higher 
priority to assistance and payments that— 
"(1) are provided in conservation priority areas established 
under section 1230(c); 
"(2) maximize environmental benefits per dollar expended; 
or 
"(3) are provided in watersheds, regions, or conservation 
priority areas in which State or local governments have pro-
vided, or will provide, financial or technical assistance to 
producers for the same conservation or environmental purposes. 
"SEC. 1240D. DUTIES OF PRODUCERS. 
"To receive technical assistance, cost-share payments, or incen-
tive payments under this chapter, a producer shall agree— 
"(1) to implement an environmental quality incentives pro-
gram plan that describes conservation and environmental goals 
to be achieved through a structural practice or land manage-
ment practice, or both, that is approved by the Secretary; 
"(2) not to conduct any practices on the farm or ranch 
that would tend to defeat the purposes of this chapter; 
"(3) on the violation of a term or condition of the contract 
at any time the producer has control of the land, to refund 
any cost-share or incentive payment received with interest, 
and forfeit any future payments under this chapter, as deter-
mined by the Secretary; 
"(4) on the transfer of the right and interest of the producer 
in land subject to the contract, unless the transferee of the 
right and interest agrees with the Secretary to assume all 
obligations of the contract, to refund all cost-share pa3anents 
and incentive payments received under this chapter, as deter-
mined by the Secretary; 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1001 
"(5) to supply information as required by the Secretary 
to determine compliance with the environmental quality incen-
tives program plan and requirements of the program; and 
"(6) to comply with such additional provisions as the Sec-
retary determines are necessary to carry out the environmental 
quality incentives program plan. 
"SEC. 1240E. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM PLAN. 
"(a) I N GENERAL.—To be eligible to enter into a contract under 
the environmental quality incentives program, an owner or producer 
of a livestock or agricultural operation must submit to the Secretary 
for approval a plan of operations that incorporates such conservation 
practices, and is based on such principles, as the Secretary considers 
necessary to carry out the program, including a description of 
structural practices and land management practices to be imple-
mented and the objectives to be met by the plan's implementation. 
"(b) AVOIDANCE OF DUPLICATION.—The Secretary shall, to the 
maximum extent practicable, eliminate duplication of planning 
activities under the environmental quality incentives program and 
comparable conservation programs. 
"SEC. 1240F. DUTIES OF THE SECRETARY. 
"To the extent appropriate, the Secretary shall assist a producer 
in achieving the conservation 
and environmental 
goals of an 
environmental quality incentives program plan by— 
"(1) providing an eligibility assessment of the farming or 
ranching operation of the producer as a basis for developing 
the plan; 
"(2) providing 
technical 
assistance 
in developing 
and 
implementing the plan; 
"(3) providing technical assistance, cost-share payments, 
or incentive payments for developing and implementing 1 or 
more structural practices or 1 or more land management prac-
tices, as appropriate; 
"(4) providing the producer with information, 
education, 
and training to aid in implementation of the plan; and 
"(5) encouraging the producer to obtain technical assist-
ance, cost-share payments, or grants from other Federal, State, 
local, or private sources. 
"SEC. 1240G. LIMITATION ON PAYMENTS. 
"(a) I N GENERAL.—The total amount of cost-share and incentive 
payments paid to a producer under this chapter may not exceed— 
"(1) $10,000 for any fiscal year; or 
"(2) $50,000 for any multiyear contract. 
"(b) EXCEPTION TO ANNUAL LIMIT.—The Secretary may exceed 
the limitation on the annual amount of a payment under subsection 
(a)(1) on a case-by-case basis if the Secretary determines 
that 
a larger payment is— 
"(1) essential to accomplish the land management practice 
or structural practice for which the payment is made; and 
"(2) consistent with the maximization of environmental 
benefits per dollar expended and the purposes of this chapter 
specified in section 1240. 
"(c) TIMING OF EXPENDITURES.—Expenditures under a contract 
entered into under this chapter during a fiscal year may not be 
made by the Secretary until the subsequent fiscal year. 
16 use 
3839aa-5. 
16 use 
3839aa-6. 
16 use 
3839aa-7. 
29-194 O - 96 - 33 : QL 3 Part 1 
110 STAT. 1002 
PUBLIC LAW 104-127—APR. 4, 1996 
16 use 
"SEC. 1240H. TEMPORARY ADMINISTRATION 
OF 
ENVIRONMENTAL 
3839aa-8. 
QUALITY INCENTIVES PROGRAM. 
"(a) INTERIM ADMINISTRATION.— 
"(1) IN GENERAL.—During the period beginning on the date 
of enactment of this section and ending on the termination 
date provided under paragraph (2), to ensure that technical 
assistance, cost-share payments, and incentive payments con-
tinue to be administered in an orderly manner until such 
time as assistance can be provided through final regulations 
issued to implement the environmental quality incentives pro-
gram established under this chapter, the Secretary shall con-
tinue to— 
"(A) provide technical assistance, cost-share payments, 
and incentive payments under the terms and conditions 
of the agricultural conservation program, the Great Plains 
conservation program, the water quality incentives pro-
gram, and the Colorado River Basin salinity control pro-
gram, to the extent the terms and conditions of the program 
are consistent with the environmental quality incentives 
program; and 
"(B) use for those purposes— 
"(i) any funds remaining available for the agricul-
tural conservation program, the Great Plains conserva-
tion program, the water quality incentives program, 
and the Colorado River Basin salinity control program; 
and 
"(ii) as the Secretary determines to be necessary, 
any funds authorized to be used to carry out the 
environmental quality incentives program. 
"(2) TERMINATION OF AUTHORITY.—The authority of 
the 
Secretary to carry out paragraph (1) shall terminate on the 
date that is 180 days after the date of enactment of this 
section. 
Effective date. 
"(b) PERMANENT ADMINISTRATION.—Effective beginning on the 
termination date provided under subsection (a)(2), the Secretary 
shall provide technical assistance, cost-share payments, and incen-
tive payments for structural practices and land management prac-
tices related to crop and livestock production in accordance with 
final regulations issued to carry out the environmental quality 
incentives program.". 
SEC. 335. CONSERVATION FARM OPTION. 
Subtitle D of title XII of the Food Security Act of 1985 (16 
U.S.C. 3830 et seq.) (as amended by section 334) is amended by 
adding at the end the following: 
"CHAPTER 
5—CONSERVATION 
FARM 
OPTION 
16 use 3839bb. 
"SEC. 1240M. CONSERVATION FARM OPTION. 
"(a) IN GENERAL.—The Secretary shall establish conservation 
farm option pilot programs for producers of wheat, feed grains, 
cotton, and rice. 
"(b) ELIGIBLE OWNERS AND PRODUCERS.—^An owner or producer 
with a farm that has contract acreage enrolled in the agricultural 
market transition program established under the Agricultural Mar-
ket Transition Act shall be eligible to participate in the conservation 
farm option offered under a pilot program under subsection (a) 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1003 
if the owner or producer meets the conditions established under 
section (e). 
"(c) PURPOSES.—The purposes of the conservation farm option 
pilot programs shall includti— 
"(1) conservation of soil, water, and related resources; 
"(2) water quality protection or improvement; 
"(3) wetland restoration, protection, and creation; 
"(4) wildlife habitat development and protection; or 
"(5) other similar conservation purposes. 
"(d) CONSERVATION FARM PLAN.— 
"(1) IN GENERAL.—To be eligible to enter into a conservation 
farm option contract, an owner or producer must prepare and 
submit to the Secretary, for approval, a conservation farm 
plan that shall become a part of the conservation farm option 
contract. 
"(2) REQUIREMENTS.—A conservation farm plan shall— 
"(A) describe the resource-conserving crop rotations, 
and all other conservation practices, to be implemented 
and maintained on the acreage that is subject to contract 
during the contract period; 
"(B) contain a schedule for the implementation and 
maintenance of the practices described in the conservation 
farm plan; 
"(C) comply with highly erodible land and wetland 
conservation requirements of this title; and 
"(D) contain such other terms as the Secretary may 
require. 
"(e) CONTRACTS.— 
"(1) IN GENERAL.—On approval of a conservation farm plan, 
the Secretary may enter into a contract with the owner or 
producer that specifies the acres being enrolled and the prac-
tices being adopted. 
"(2) DURATION OF CONTRACT.—The contract shall be for 
a period of 10 years. The contract may be renewed for a period 
of not to exceed 5 years on mutual agreement of the Secretary 
and the owner or producer. 
"(3) CONSIDERATION.—In exchange for payments under this 
subsection, the owner or producer shall not participate in and 
shall forgo payments under— 
"(A) the conservation reserve program established 
under subchapter B of chapter 1; 
"(B) the wetlands reserve program established under 
subchapter C of chapter 1; and 
"(C) the environmental quality incentives program 
established under chapter 4. 
"(4) 
OWNER OR PRODUCER RESPONSIBILITIES UNDER THE 
AGREEMENT.—Under the terms of the contract entered into 
under this section, an owner or producer shall agree to— 
"(A) actively comply with the terms and conditions 
of the approved conservation farm plan; 
"(B) keep such records as the Secretary may reasonably Records. 
require for purposes of evaluation of the implementation 
of the conservation farm plan; and 
"(C) not engage in any activity that would defeat the 
purposes of the conservation farm option pilot program. 
"(5) PAYMENTS.—The Secretary shall offer an owner or 
producer annual payments under the contract that are equiva-
110 STAT. 1004 
PUBLIC LAW 104-127—APR. 4, 1996 
lent to the payments the owner or producer would have received 
under the conservation reserve program, the wetlands reserve 
program, and the environmental quality incentives program. 
"(6) BALANCE OF BENEFITS.—The Secretary shall not permit 
an owner or producer to terminate a conservation reserve pro-
gram contract and enter a conservation farm option contract 
if the Secretary determines that such action will reduce net 
environmental benefits. 
"(f) SECRETARIAL DETERMINATIONS.— 
"(1) ACREAGE ESTIMATES.—Prior to each year during which 
the Secretary intends to offer conservation reserve program 
contracts, the Secretary shall estimate the number of acres 
that— 
"(A) will be retired under the conservation farm option 
under the terms and conditions the Secretary intends to 
offer for that program; and 
"(B) would be retired under the conservation reserve 
program if the conservation farm option were not available. 
"(2) 
TOTAL 
LAND 
RETIREMENT.—The 
Secretary 
shall 
announce a number of acres to be enrolled in the conservation 
reserve program that will result in a total number of acres 
retired under the conservation reserve program and the con-
servation farm option that does not exceed the amount esti-
mated under paragraph (1)(B) for the current or future years. 
"(3) LIMITATION.—The Secretary shall not enroll additional 
conservation reserve program contracts to offset the land retired 
under the conservation farm option. 
"(g) COMMODITY CREDIT CORPORATION.—The Secretary shall 
use the funds, authorities, and facilities of the Commodity Credit 
Corporation to carry out this subsection. 
"(h) FUNDING.—Of the funds of the Commodity Credit Corpora-
tion, the Corporation shall make available to carry out this section— 
"(1) $7,500,000 for fiscal year 1997; 
"(2) $15,000,000 for fiscal year 1998; 
"(3) $25,000,000 for fiscal year 1999; 
"(4) $37,500,000 for fiscal year 2000; 
"(5) $50,000,000 for fiscal year 2001; and 
"(6) $62,500,000 for fiscal year 2002.". 
SEC. 336. REPEAL OF SUPERSEDED AUTHORITIES. 
(a) AGRICULTURAL CONSERVATION PROGRAM.— 
(1) ELIMINATION.— 
(A) Section 8 of the Soil Conservation and Domestic 
Allotment Act (16 U.S.C. 590h) is amended— 
(i) in subsection (b)— 
(I) by striking paragraphs (1) through (4) and 
inserting the following: 
"(1) ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.—The 
Secretary shall provide technical assistance, cost-share pay-
ments, and incentive payments to operators through the 
environmental quality incentives program in accordance with 
chapter 4 of subtitle D of title XII of the Food Security Act 
of 1985."; and 
(II) by striking paragraphs (6) through (8); 
and 
(ii) by striking subsections (d), (e), and (f). 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1005 
(B) The first sentence of section 11 of the Soil Conserva-
tion and Domestic Allotment Act (16 U.S.C. 590k) is amend-
ed by striking "performance: Provided further," and all 
that follows through "or other law" and inserting "perform-
ance". 
(C) Section 14 of the Soil Conservation and Domestic 
Allotment Act (16 U.S.C. 590n) is amended— 
(i) in the first sentence, by striking "or 8"; and 
(ii) by striking the second sentence. 
(D) Section 15 of the Soil Conservation and Domestic 
Allotment Act (16 U.S.C. 590o) is amended— 
(i) in the first undesignated paragraph— 
(I) in the first sentence, by striking "sections 
7 and 8" and inserting "section 7"; and 
(II) by striking the third sentence; and 
(ii) by striking the second undesignated paragraph. 
(2) CONFORMING AMENDMENTS.— 
(A) Paragraph (1) of the last proviso of the matter 
under the heading "CONSERVATION RESERVE PROGRAM" 
under the heading "SoiL BANK PROGRAMS" of title I of 
the Department of Agriculture and Farm Credit Adminis-
tration Appropriation Act, 1959 (72 Stat. 195; 7 U.S.C. 
1831a), is amended by striking "Agricultural Conservation 
Program" and inserting "environmental quality incentives 
program established under chapter 4 of subtitle D of title 
XII of the Food Security Act of 1985". 
(B) Section 4 of the Cooperative Forestry Assistance 
Act of 1978 (16 U.S.C. 2103) is amended by striking "as 
added by the Agriculture and Consumer Protection Act 
of 1973" each place it appears in subsections (d) and (i) 
and inserting "as in effect before the amendment made 
by section 336(d)(1) of the Federal Agriculture Improve-
ment and Reform Act of 1996". 
(C) Section 226(b)(4) of the Department of Agriculture 
Reorganization Act of 1994 (7 U.S.C. 6932(b)(4)) is amended 
by striking "and the agricultural conservation program 
under the Soil Conservation and Domestic Allotment Act 
(16 U.S.C. 590getseq.)". 
(D) Section 246(b)(8) of the Department of Agriculture 
Reorganization Act of 1994 (7 U.S.C. 6962(b)(8)) is amended 
by striking "and the agricultural conservation program 
under the Soil Conservation and Domestic Allotment Act 
(16 U.S.C. 590getseq.)". 
(E) Section 1271(c)(3)(C) of the Food, Agriculture, Con-
servation, and Trade Act of 1990 (16 U.S.C. 2106a(c)(3)(C)) 
is amended by striking "Agricultural Conservation Program 
established under section 16(b) of the Soil Conservation 
and Domestic Allotment Act (16 U.S.C. 590h, 5901, or 
590p)" and inserting "environmental quality incentives pro-
gram established under chapter 4 of subtitle D of title 
XII of the Food Security Act of 1985". 
(F) Section 304(a) of the Lake Champlain Special Des-
ignation Act of 1990 (Public Law 101-596; 33 U.S.C. 1270 
note) is amended— 
(i) in the subsection heading, by striking "SPECIAL 
PROJECT AREA UNDER THE AGRICULTURAL CONSERVA-
TION PROGRAM" and inserting "PRIORITY AREA UNDER 
110 STAT. 1006 
PUBLIC LAW 104-127—APR. 4, 1996 
THE ENVIRONMENTAL QUALITY INCENTIVES PROGRAM"; 
and 
(ii) in paragraph (1), by striking "special project 
area under the Agricultural Conservation Program 
established under section 8(b) of the Soil Conservation 
and Domestic Allotment Act (16 U.S.C. 590h(b))" and 
inserting "priority area under the environmental qual-
ity incentives program established under chapter 4 
of subtitle D of title XII of the Food Security Act 
of 1985". 
(G) Section 6 of the Department of Agriculture Organic 
i6USC590h-4. 
Act of 1956 (70 Stat. 1033) is amended by striking sub-
section (b). 
(b) GREAT PLAINS CONSERVATION PROGRAM.— 
(1) ELIMINATION.—Section 16 of the Soil Conservation and 
Domestic Allotment Act (16 U.S.C. 590p) is repealed. 
(2) CONFORMING AMENDMENTS.— 
(A) The Agricultural Adjustment Act of 1938 is amend-
ed by striking "Great Plains program" each place it appears 
in sections 344(0(8) and 377 (7 U.S.C. 1344(0(8) and 1377) 
and inserting "environmental quality incentives program 
established under chapter 4 of subtitle D of title XII of 
the Food Security Act of 1985". 
(B) Section 246(b) of the Department of Agriculture 
Reorganization Act of 1994 (7 U.S.C. 6962(b)) is amended 
by striking paragraph (2). 
(c) COLORADO RIVER BASIN SALINITY CONTROL PROGRAM.— 
(1) IN GENERAL.—Section 202 of the Colorado River Basin 
Salinity Control Act (43 U.S.C. 1592) is amended by striking 
subsection (c) and inserting the following: 
"(c) SALINITY CONTROL MEASURES.—^The Secretary of Agri-
culture shall carry out salinity control measures (including water-
shed enhancement and cost-share measures with livestock and crop 
producers) in the Colorado River Basin as part of the environmental 
quality incentives program established under chapter 4 of subtitle 
D of title XII of the Food Security Act of 1985.". 
(2) FUNDS.—Section 205 of the Colorado River Basin Salin-
ity Control Act (43 U.S.C. 1595) is amended— 
(A) in subsection (a), by striking "pursuant to section 
202(c)(2)(C)"; and 
(B) by adding at the end the following: 
"(0 FUNDS.—The Secretary may expend funds available in the 
Basin Funds referred to in this section to carry out cost-share 
salinity measures in a manner that is consistent with the cost 
allocations required under this section.". 
(3) CONFORMING AMENDMENT.—Section 246(b)(6) of the 
Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 
6962(b)(6)) is amended by striking "program" and inserting 
"measures". 
(d) RURAL ENVIRONMENTAL CONSERVATION PROGRAM.— 
(1) ELIMINATION.—Title X of the Agricultural Act of 1970 
(16 U.S.C. 1501 et seq.) is repealed. 
(2) CONFORMING AMENDMENTS.—Section 246 of the Depart-
ment of Agriculture Reorganization Act of 1994 (7 U.S.C. 6962) 
(as amended by subsection (b)(2)(B)) is amended— 
(A) in subsection (b)— 
(i) by striking paragraph (1); and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1007 
(ii) by redesignating paragraphs (3) through (8) 
as paragraphs (1) through (6), respectively; and 
(B) in subsection (c), by striking "(2), (3), (4), and 
(6)" and inserting "(1), (2), and (4)". 
(e) OTHER CONSERVATION PROVISIONS.—Subtitle F of title XII 
of the Food Security Act of 1985 (16 U.S.C. 2005a and 2101 note) 
is repealed. 
(f) RESOURCE CONSERVATION.— 
(1) ELIMINATION.—Subtitles A, B, D, E, and F of title 
XV of the Agriculture and Food Act of 1981 (95 Stat. 1328; 
16 U.S.C. 3401 et seq.) are repealed. 
(2) CONFORMING AMENDMENT.—Section 739 of the Agri-
culture, Rural Development, Food and Drug Administration, 
and Related Agencies Appropriations Act, 1992 (7 U.S.C. 
2272a), is repealed. 
(g) TECHNICAL AMENDMENT.—The first sentence of the matter 
under the heading "COMMODITY CREDIT CORPORATION" of Public 
Law 99-263 (100 Stat. 59; 16 U.S.C. 3841 note) is amended by 
striking "prices: Provided further" 
and all that follows through 
"Acts." and inserting "prices.". 
(h) 
AGRICULTURAL WATER QUALITY INCENTIVES PROGRAM.— 
Chapter 2 of subtitle D of title XII of the Food Security Act of 
1985 (16 U.S.C. 3838 et seq.) is repealed. 
Subtitle E—Conservation Funding and 
Administration 
SEC. 341. CONSERVATION FtWDING AND ADMINISTRATION. 
Subtitle E of title XII of the Food Security Act of 1985 (16 
U.S.C. 3841 et seq.) is amended to read as follows: 
"Subtitle E—Funding and Administration 
"SEC. 1241. FUNDING. 
16 USC 3841. 
"(a) MANDATORY EXPENSES.—For each of fiscal years 1996 
through 2002, the Secretary shall use the funds of the Commodity 
Credit Corporation to carry out the programs authorized by— 
"(1) subchapter B of chapter 1 of subtitle D (including 
contracts extended by the Secretary pursuant to section 1437 
of the Food, Agriculture, Conservation, and Trade Act of 1990 
(Public Law 101-624; 16 U.S.C. 3831 note)); 
"(2) subchapter C of chapter 1 of subtitle D; and 
"(3) chapter 4 of subtitle D. 
"(b) ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.— 
"(1) IN GENERAL.—Of the funds of the Commodity Credit 
Corporation, the Secretary shall make available $130,000,000 
for fiscal year 1996, aiid $200,000,000 for each of fiscal years 
1997 through 2002, for providing technical assistance, cost-
share payments, incentive payments, and education under the 
environmental quality incentives program under chapter 4 of 
subtitle D. 
"(2) LIVESTOCK PRODUCTION.—For each of fiscal years 1996 
through 2002, 50 percent of the funding available for technical 
assistance, cost-share payments, incentive payments, and edu-
110 STAT. 1008 
PUBLIC LAW 104-127—APR. 4, 1996 
cation under the environmental quality incentives program 
shall be targeted at practices relating to livestock production. 
16 u s e 3842. 
"SEC. 1242. USE OF OTHER AGENCIES. 
"(a) COMMITTEES.—In carrying out subtitles B, C, and D, the 
Secretary shall use the services of local, county, and State commit-
tees established under section 8(b) of the Soil Conservation and 
Domestic Allotment Act (16 U.S.C. 590h(b)). 
"(b) OTHER AGENCIES.— 
"(1) USE.—In carrying out subtitles C and D, the Secretary 
may utilize the services of the Natural Resources Conservation 
Service and the Forest Service, the Fish and Wildlife Service, 
State forestry agencies, State fish and game agencies, land-
grant colleges, local, county, and State committees established 
under section 8(b) of the Soil Conservation and Domestic Allot-
ment Act (16 U.S.C. 590h), soil and water conservation districts, 
and other appropriate agencies. 
"(2) CONSULTATION.—In carrying out subtitle D at the State 
and county levels, the Secretary shall consult with, to the 
extent practicable, the Fish and Wildlife Service, State forestry 
agencies, State fish and game agencies, land-grant colleges, 
soil-conservation districts, and other appropriate agencies. 
16 u s e 3843. 
"SEC. 1243. ADMINISTRATION. 
"(a) PLANS.—The Secretary shall, to the extent practicable, 
avoid duplication in— 
"(1) the conservation plans required for— 
"(A) highly erodible land conservation under subtitle 
B; 
"(B) the conservation reserve program established 
under subchapter B of chapter 1 of subtitle D; and 
"(C) the wetlands reserve program established under 
subchapter C of chapter 1 of subtitle D; and 
"(2) the environmental quality incentives program estab-
lished under chapter 4 of subtitle D. 
"(b) ACREAGE LIMITATION.— 
"(1) IN GENERAL.—The Secretary shall not enroll more than 
25 percent of the cropland in any county in the programs 
administered under the conservation reserve and wetlands 
reserve programs established under subchapters B and C, 
respectively, of chapter 1 of subtitle D. Not more than 10 
percent of the cropland in a county may be subject to an 
easement acquired under the subchapters. 
"(2) EXCEPTION.—The Secretary may exceed the limitations 
in paragraph (1) if the Secretary determines that— 
"(A) the action would not adversely affect the local 
economy of a county; and 
"(B) operators in the county are having difficulties 
complying with conservation plans implemented under sec-
tion 1212. 
"(3) 
SHELTERBELTS AND WINDBREAKS.—^The limitations 
established under this subsection shall not apply to cropland 
that is subject to an easement under chapter 1 or 3 of subtitle 
D that is used for the establishment of shelterbelts and 
windbreaks. 
"(c) TENANT PROTECTION.—Except for a person who is a tenant 
on land that is subject to a conservation reserve contract that 
has been extended by the Secretary, the Secretary shall provide 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1009 
adequate safeguards to protect the interests of tenants and share-
croppers, including provision for sharing, on a fair and equitable 
basis, in payments under the programs established under subtitles 
B through D. 
"(d) 
PROVISION 
OF 
TECHNICAL 
ASSISTANCE 
BY 
OTHER 
SOURCES.—In the preparation and application of a conservation 
compliance plan under subtitle B or similar plan required as a 
condition for assistance from the Department of Agriculture, the 
Secretary shall permit persons to secure technical assistance from 
approved sources, as determined by the Secretary, other than the 
Natural Resources Conservation Service. If the Secretary rejects 
a technical determination made by such a source, the basis of 
the Secretary's determination must be supported by documented 
evidence. 
"(e) REGULATIONS.—Not later than 90 days after the date of 
enactment of the Federal Agriculture Improvement and Reform 
Act of 1996, the Secretary shall issue regulations to implement 
the conservation reserve and wetlands reserve programs established 
under chapter 1 of subtitle D.". 
SEC. 342. STATE TECHNICAI. COMMITTEES. 
(a) COMPOSITION.—Section 1261(c) of the Food Security Act 
of 1985 (16 U.S.C. 3861(c))— 
(1) in paragraph (7), by striking "and" at the end; 
(2) in paragraph (8), by striking the period at the end 
and inserting a semicolon; and 
(3) by adding at the end the following: 
"(9) agricultural producers with demonstrable conservation 
expertise; 
"(10) nonprofit organizations with demonstrable conserva-
tion expertise; 
"(11) persons knowledgeable about conservation techniques; 
and 
"(12) agribusiness.". 
(b) RESPONSIBILITIES.—Section 1262 of the Food Security Act 
of 1985 (16 U.S.C. 3862) is amended— 
(1) in subsection (a), by adding at the end the following: 
"Each State technical committee shall provide public notice 
of, and permit public attendance at meetings considering, issues 
of concern related to carrying out this title."; 
(2) in subsection (b)(1), by adding at the end the following: 
"Each State technical committee shall establish criteria and 
guidelines for evaluating petitions by agricultural producers 
regarding new conservation practices and systems not already 
described in field office technical guides."; and 
(3) in subsection (c)— 
(A) in paragraph (7), by striking "and" at the end; 
(B) by redesignating paragraph (8) as paragraph (9); 
and 
(C) by inserting after paragraph (7) the following: 
"(8) establishing criteria and priorities for State initiatives 
under the environmental quality incentives program under 
chapter 4 of subtitle D; and". 
SEC. 343. PUBLIC NOTICE AND COMMENT FOR REVISIONS TO CERTAIN 
16 USC 3862 
STATE TECHNICAL GUIDES. 
note. 
After the date of enactment of this Act, the Secretary of Agri-
culture shall provide for public notice and comment under section 
110 STAT. 1010 
PUBLIC LAW 104-127—APR. 4, 1996 
553 of title 5, United States Code, with regard to any future 
revisions to those provisions of the Natural Resources Conservation 
Service State technical guides that are used to carry out subtitles 
A, B, and C of title XII of the Food Security Act of 1985 (16 
U.S.C. 3801 et seq.). 
N
a
t
i
o
n
a
l Natural 
Subtltle F—National Natural Resources 
Resources 
>-w 
. . 
•--• 
i 
j • 
Conservation 
Conservatioii h oundation 
Foundation Act. 
16 u s e 5801 
SEC. 351. SHORT TITLE. 
This subtitle may be cited as the "National Natural Resources 
Conservation Foundation Act". 
16 u s e 5801. 
SEC. 352. DEFINITIONS. 
In this subtitle (unless the context otherwise requires): 
(1) BOARD.—^The term "Board" means the Board of Trustees 
established under section 354. 
(2) DEPARTMENT.—The term "Department" means the 
Department of Agriculture. 
(3) FOUNDATION.—The term "Foundation" means the 
National Natural Resources Conservation Foundation estab-
lished by section 353(a). 
(4) SECRETARY.—^The term "Secretary" means the Secretary 
of Agriculture. 
16 u s e 5802. 
SEC. 353. NATIONAL NATURAL RESOURCES CONSERVATION FOUNDA-
TION. 
(a) ESTABLISHMENT.—^A National Natural Resources Conserva-
tion Foundation is established as a charitable and nonprofit corpora-
tion for charitable, scientific, and educational purposes specified 
in subsection (b). The Foundation is not an agency or instrumental-
ity of the United States. 
(b) DUTIES.—^The Foundation shall— 
(1) promote innovative solutions to the problems associated 
with the conservation of natural resources on private lands, 
particularly with respect to agriculture and soil and water 
conservation; 
(2) promote voluntary partnerships between government 
and private interests in the conservation of natural resources; 
(3) conduct research and undertake educational activities, 
conduct and support demonstration projects, and make grants 
to State and local agencies and nonprofit organizations; 
(4) provide such other leadership and support as may be 
necessary to address conservation challenges, such as the 
prevention of excessive soil erosion, the enhancement of soil 
and water quality, and the protection of wetlands, wildlife 
habitat, and strategically important farmland subject to urban 
conversion and fragmentation; 
(5) encourage, accept, and administer private gifts of money 
and real and personal property for the benefit of, or in connec-
tion with, the conservation and related activities and services 
of the Department, particularly the Natural Resources Con-
servation Service; 
(6) undertake, conduct, and encourage educational, tech-
nical, and other assistance, and other activities, that support 
the conservation and related programs administered by the 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1011 
Department (other than activities carried out on National For-
est System lands), particularly the Natural Resources Con-
servation Service, except that the Foundation may not enforce 
or administer a regulation of the Department; and 
(7) raise private funds to promote the purposes of the 
Foundation. 
(c) LIMITATIONS AND CONFLICTS OF INTEREST.— 
(1) 
POLITICAL 
ACTIVITIES.—The Foundation 
shall 
not 
participate or intervene in a political campaign on behalf of 
any candidate for public office. 
(2) 
CONFLICTS 
OF 
INTEREST.—No director, officer, 
or 
employee of the Foundation shall participate, directly or 
indirectly, in the consideration or determination of any question 
before the Foundation affecting— 
(A) the financial interests of the director, officer, or 
employee; or 
(B) the interests of any corporation, partnership, entity, 
organization, or other person in which the director, officer, 
or employee— 
(i) is an officer, director, or trustee; or 
(ii) has any direct or indirect financial interest. 
(3) LEGISLATION OR GOVERNMENT ACTION OR POLICY.—No 
funds of the Foundation may be used in any manner for the 
purpose of influencing legislation or government action or pol-
icy. 
(4) LITIGATION.—No funds of the Foundation may be used 
to bring or join an action against the United States. 
SEC. 354. COMPOSITION AND OPERATION. 
16 USC 5803. 
(a) COMPOSITION.—The Foundation shall be administered by 
a Board of Trustees that shall consist of 9 voting members, each 
of whom shall be a United States citizen and not a Federal officer. 
The Board shall be composed of— 
(1) individuals with expertise in agricultural conservation 
policy matters; 
(2) a representative of private sector organizations with 
a demonstrable interest in natural resources conservation; 
(3) a representative of statewide conservation organiza-
tions; 
(4) a representative of soil and water conservation districts; 
(5) a representative of organizations outside the Federal 
Government that are dedicated to natural resources conserva-
tion education; and 
(6) a farmer or rancher. 
(b) NONGOVERNMENTAL EMPLOYEES.—Service as a member of 
the Board shall not constitute employment by, or the holding of, 
an ofBce of the United States for the purposes of any Federal 
law. 
(c) MEMBERSHIP.— 
(1) INITIAL MEMBERS.—The Secretary shall appoint 9 per-
sons who meet the criteria established under subsection (a) 
as the initial members of the Board and designate 1 of the 
members as the initial chairperson for a 2-year term. 
(2) TERMS OF OFFICE.— 
(A) IN GENERAL.—^A member of the Board shall serve 
for a term of 3 years, except that the members appointed 
110 STAT. 1012 
PUBLIC LAW 104-127—APR. 4, 1996 
to the initial Board shall serve, proportionately, for terms 
of 1, 2, and 3 years, as determined by the Secretary. 
(B) LIMITATION ON TERMS.—No individual may serve 
more than 2 consecutive 3-year terms as a member of 
the Board. 
(3) SUBSEQUENT MEMBERS.—The initial members of the 
Board shall adopt procedures in the constitution of the Founda-
tion for the nomination and selection of subsequent members 
of the Board. The procedures shall require that each member, 
at a minimum, meets the criteria established under subsection 
(a) and shall provide for the selection of an individual, who 
is not a Federal officer or a member of the Board. 
(d) CHAIRPERSON.—^After the appointment of an initial chair-
person under subsection (c)(1), each succeeding chairperson of the 
Board shall be elected by the members of the Board for a 2-
year term. 
(e) VACANCIES.—^A vacancy on the Board shall be filled by 
the Board not later than 60 days after the occurrence of the vacancy. 
(f) COMPENSATION.—A member of the Board shall receive no 
compensation from the Foundation for the service of the member 
on the Board. 
(g) TRAVEL EXPENSES.—While away from the home or regular 
place of business of a member of the Board in the performance 
of services for the Board, the member shall be allowed travel 
expenses paid by the Foundation, including per diem in lieu of 
subsistence, at the same rate as a person employed intermittently 
in the Government service is allowed under section 5703 of title 
5, United States Code. 
16 use 5804. 
SEC. 355. OFFICERS AND EMPLOYEES. 
(a) IN GENERAL.—The Board may— 
(1) appoint, hire, and discharge the officers and employees 
of the Foundation, other than appoint the initial Executive 
Director of the Foundation; 
(2) adopt a constitution and bylaws for the Foundation 
that are consistent with the purposes of this subtitle; and 
(3) undertake any other activities that may be necessary 
to carry out this subtitle. 
(b) OFFICERS AND EMPLOYEES.— 
(1) APPOINTMENT AND HIRING.—^An officer or employee of 
the Foundation— 
(A) shall not, by virtue of the appointment or employ-
ment of the officer or employee, be considered a Federal 
employee for any purpose, including the provisions of title 
5, United States Code, governing appointments in the 
competitive service, except that such an individual may 
participate in the Federal employee retirement system as 
if the individual were a Federal employee; and 
(B) may not be paid by the Foundation a salary in 
excess of $125,000 per year. 
(2) EXECUTIVE DIRECTOR.— 
(A) INITIAL DIRECTOR.—^The Secretary shall appoint an 
individual to serve as the initial Executive Director of 
the Foundation who shall serve, at the direction of the 
Board, as the chief operating officer of the Foundation. 
(B) SUBSEQUENT DIRECTORS.—The Board shall appoint 
each subsequent Executive Director of the Foundation who 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1013 
shall serve, at the direction of the Board, as the chief 
operating officer of the Foundation. 
(C) QUALIFICATIONS.—The Executive Director shall be 
knowledgeable and experienced in matters relating to natu-
ral resources conservation. 
SEC. 356. CORPORATE POWERS AND OBLIGATIONS OF THE FOUNDA- 
16 USC 5805. 
TION. 
(a) IN GENERAL.—The Foundation— 
(1) may conduct business throughout the United States 
and the territories and possessions of the United States; and 
(2) shall at all times maintain a designated agent who 
is authorized to accept service of process for the Foundation, 
so that the serving of notice to, or service of process on, the 
agent, or mailed to the business address of the agent, shall 
be considered as service on or notice to the Foundation. 
(b) SEAL.—The Foundation shall have an official seal selected 
by the Board that shall be judicially noticed. 
(c) POWERS.—To carrj^ out the purposes of the Foundation under 
section 353(b), the Foundation shall have, in addition to the powers 
otherwise provided under this subtitle, the usual powers of a cor-
poration, including the power— 
(1) to accept, receive, solicit, hold, administer, and use 
any gift, devise, or bequest, either absolutely or in trust, of 
real or personal property or any income from, or other interest 
in, the gift, devise, or bequest; 
(2) to acquire by purchase or exchange any real or personal 
property or interest in property, except that funds provided 
under section 360 may not be used to purchase an interest 
in real property; 
(3) unless otherwise required by instrument of transfer, 
to sell, donate, lease, invest, reinvest, retain, or otherwise dis-
pose of any property or income from property; 
(4) to borrow money from private sources and issue bonds, 
debentures, or other debt instruments, subject to section 359, 
except that the aggregate amount of the borrowing and debt 
instruments 
outstanding 
at 
any 
time 
may 
not 
exceed 
$1,000,000; 
(5) to sue and be sued, and complain and defend itself, 
in any court of competent jurisdiction, except that a member 
of the Board shall not be personally liable for an action in 
the performance of services for the Board, except for gross 
negligence; 
(6) to enter into a contract or other agreement with an 
agency of State or local government, educational institution, 
or other private organization or person and to make such pay-
ments as may be necessary to carry out the functions of the 
Foundation; and 
(7) to do any and all acts that are necessary to carry 
out the purposes of the Foundation. 
(d) INTERESTS IN PROPERTY.— 
(1) INTERESTS IN REAL PROPERTY.—The Foundation may 
acquire, hold, and dispose of lands, waters, or other interests 
in real property by donation, gift, devise, purchase, or exchange. 
An interest in real property shall be treated, among other 
things, as including an easement or other right for the preserva-
tion, conservation, protection, or enhancement of agricultural, 
110 STAT. 1014 
PUBLIC LAW 104-127—APR. 4, 1996 
natural, scenic, historic, scientific, educational, inspirational, 
or recreational resources. 
(2) GIFTS.—^A gift, devise, or bequest may be accepted by 
the Foundation even though the gift, devise, or bequest is 
encumbered, restricted, or subject to a beneficial interest of 
a private person if any current or future interest in the gift, 
devise, or bequest is for the benefit of the Foundation. 
16 u s e 5806. 
SEC. 357. ADMINISTRATIVE SERVICES AND SUPPORT. 
For each of fiscal years 1996 through 1998, the Secretary may 
provide, without reimbursement, personnel, facilities, and other 
administrative services of the Department to the Foundation. 
16 u s e 5807. 
SEC. 358. AUDITS AND PETITION OF ATTORNEY GENERAL FOR EQUI-
TABLE RELIEF. 
(a) AUDITS.— 
(1) IN GENERAL.—The accounts of the Foundation shall 
be audited in accordance with Public Law 88-504 (36 U.S.C. 
1101 et seq.), including an audit of lobbying and litigation 
activities carried out by the Foundation. 
(2) CONFORMING AMENDMENT.—The first section of Public 
Law 88-504 (36 U.S.C. 1101) is amended by adding at the 
end the following: 
"(77) The 
National 
Natural 
Resources 
Conservation 
Foundation.". 
(b) RELIEF WITH RESPECT TO CERTAIN FOUNDATION ACTS OR 
FAILURE TO ACT.—^The Attorney General may petition in the United 
States District Court for the District of Columbia for such equitable 
relief as may be necessary or appropriate, if the Foundation— 
(1) engages in, or threatens to engage in, any act, practice, 
or policy that is inconsistent with this subtitle; or 
(2) refuses, fails, neglects, or threatens to refuse, fail, or 
neglect, to discharge the obligations of the Foundation under 
this subtitle. 
16 u s e 5808. 
SEC. 359. RELEASE FROM LIABILITY. 
(a) IN GENERAL.—The United States shall not be liable for 
any debt, default, act, or omission of the Foundation. The full 
faith and credit of the United States shall not extend to the Founda-
tion. 
(b) STATEMENT.—^An obligation issued by the Foundation, and 
a document offering an obligation, shall include a prominent state-
ment that the obligation is not directly or indirectly guaranteed, 
in whole or in part, by the United States (or an agency or instrumen-
tality of the United States). 
16 u s e 5809. 
S E C . 360. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated to the Department 
to be made available to the Foundation $1,000,000 for each of 
fiscal years 1997 through 1999 to initially establish and carry 
out activities of the Foundation. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1015 
Subtitle G—Forestry 
SEC. 371. OFFICE OF INTERNATIONAL FORESTRY. 
Section 2405 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 6704) is amended by adding at the end 
the following: 
"(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated for each of fiscal years 1996 through 2002 
such sums as are necessar}^ to carry out this section.". 
SEC. 372. COOPERATIVE WORK FOR PROTECTION, MANAGEMENT, AND 
IMPROVEMENT OF NATIONAL FOREST SYSTEM. 
The penultimate paragraph of the matter under the heading 
"FOREST SERVICE." of the first section of the Act of June 30, 
1914 (38 Stat. 430, chapter 131; 16 U.S.C. 498), is amended— 
(1) by inserting ", management," after "the protection"; 
(2) by striking "national forests," and inserting "National 
Forest System,"; 
(3) by inserting "management," after "protection," both 
places it appears; and 
(4) by adding at the end the following: "Payment for work 
undertaken pursuant to this paragraph may be made from 
any appropriation of the Forest Service that is available for 
similar work if a written agreement so provides and reimburse-
ment will be provided by a cooperator in the same fiscal year 
as the expenditure by the Forest Service. A reimbursement 
received from a cooperator that covers the proportionate share 
of the cooperator of the cost of the work shall be deposited 
to the credit of the appropriation of the Forest Service from 
which the payment was initially made or, if the appropriation 
is no longer available, to the credit of an appropriation of 
the Forest Service that is available for similar work. The Sec- Rules. 
retary of Agriculture shall establish written rules that establish 
criteria to be used to determine whether the acceptance of 
contributions of money under this paragraph would adversely 
affect the ability of an officer or employee of the Department 
of Agriculture to carry out a duty or program of the officer 
or employee in a fair and objective manner or would com-
promise, or appear to compromise, the integrity of the program, 
officer, or employee. The Secretary of Agriculture shall establish Rules. 
written rules that protect the interests of the Forest Service 
in cooperative work agreements.". 
SEC. 373. FORESTRY INCENTIVES PROGRAM. 
Section 4 of the Cooperative Forestry Assistance Act of 1978 
(16 U.S.C. 2103) is amended— 
(1) in subsection (j), by striking "annually" and inserting 
"for each of fiscal years 1996 through 2002"; and 
(2) by striking subsection (k). 
SEC. 
374. 
OPTIONAL 
STATE 
GRANTS 
FOR 
FOREST 
LEGACY 
PROGRAM. 
Section 7 of the Cooperative Forestry Assistance Act of 1978 
(16 U.S.C. 2103c) is amended— 
(1) by redesignating subsection (1) as subsection (m); and 
(2) by inserting after subsection (k) the following: 
"(1) OPTIONAL STATE GRANTS.— 
110 STAT. 1016 
PUBLIC LAW 104-127—APR. 4, 1996 
"(1) IN GENERAL.—^The Secretary shall, at the request of 
a participating State, provide a grant to the State to carry 
out the Forest Legacy Program in the State. 
"(2) ADMINISTRATION.—If a State elects to receive a grant 
under this subsection— 
"(A) the Secretary shall use a portion of the funds 
made available under subsection (m), as determined by 
the Secretary, to provide a grant to the State; and 
"(B) the State shall use the grant to carry out the 
Forest Legacy Program in the State, including the acquisi-
tion by the State of lands and interests in lands.". 
Subtitle H—Miscellaneous Conservation 
Provisions 
SEC. 381. CONSERVATION ACTIVITIES OF COMMODITY CREDIT COR-
PORATION. 
(a) IN GENERAL.—Section 5 of the Commodity Credit Corpora-
tion Charter Act (15 U.S.C. 714c) is amended— 
(1) by redesignating subsection (g) as subsection (h); and 
(2) by inserting after subsection (f) the following: 
"(g) Carry out conservation or environmental programs author-
ized by law.". 
15 use 714c 
(b) EFFECTIVE DATE.—The amendments made by subsection 
note. 
(a) shall become effective on January 1, 1997. 
SEC. 382. F L O O D P L A I N EASEMENTS. 
Section 403 of the Agricultural Credit Act of 1978 (16 U.S.C. 
2203) is amended by inserting ", including the purchase of floodplain 
easements," after "emergency measures". 
SEC. 383. RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM. 
Section 1538 of the Agriculture and Food Act of 1981 (16 
U.S.C. 3461) is amended by striking "1991 through 1995" and 
inserting "1996 through 2002". 
SEC. 384. REPEAL OF REPORT REQUIREMENT. 
Section 1342 of title 44, United States Code, is repealed. 
7 u s e 7334. 
SEC. 385. FLOOD RISK REDUCTION. 
(a) IN GENERAL.—During fiscal years 1996 through 2002, the 
Secretary of Agriculture (referred to in this section as the "Sec-
retary") may enter into a contract with a producer on a farm 
who has contract acreage under the Agricultural Market Transition 
Act that is frequently flooded. 
(b) DUTIES OF PRODUCERS.—^Under the terms of the contract, 
with respect to acres that are subject to the contract, the producer 
must agree to— 
(1) the termination of any contract acreage and production 
flexibility contract under the Agricultural Market Transition 
Act; 
(2) forgo loans for contract commodities, oilseeds, and extra 
long staple cotton; 
(3) not apply for crop insurance issued or reinsured by 
the Secretary; 
(4) comply with applicable highly erodible land and wet-
lands conservation compliance requirements established under 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1017 
title XII of the Food Security Act of 1985 (16 U.S.C. 3801 
et seq.); 
(5) not apply for any conservation program payments from 
the Secretary; 
(6) not apply for disaster program benefits provided by 
the Secretary; and 
(7) refund the payments, with interest, issued under the 
flood risk reduction contract to the Secretary, if the producer 
violates the terms of the contract or if the producer transfers 
the property to another person who violates the contract. 
(c) DUTIES OF THE SECRETARY.—In return for a contract entered 
into by a producer under this section, the Secretary shall pay 
the producer an amount that is not more than 95 percent of pro-
jected contract payments under the Agricultural Market Transition 
Act that the Secretary estimates the producer would otherwise 
have received during the period beginning at the time the contract 
is entered into under this section and ending September 30, 2002. 
(d) COMMODITY CREDIT CORPORATION.—The Secretary shall 
carry out the program Eiuthorized by this section (other than sub-
section (e)) through the Commodity Credit Corporation. 
(e) ADDITIONAL PAYMENTS.— 
(1) IN GENERAL.—Subject to the availability of advanced 
appropriations, the Secretary may make payments to a producer 
described in subsection (a), in addition to the payments provided 
under subsection (c), to offset other estimated Federal Govern-
ment outlays on frequently flooded land. 
(2) AUTHORIZATION OF APPROPRIATIONS.—There are author-
ized to be appropriated such sums as are necessary to carry 
out paragraph (1). 
(f) LIMITATION ON PAYMENTS.—Amounts made available for 
production flexibility contracts under section 113 shall be reduced 
by an amount that is equal to the contract payments that producers 
forgo under subsection (b)(1) of this section. 
SEC. 386. CONSERVATION OF PRIVATE GRAZING LAND. 
16 USC 2005b. 
(a) FINDINGS.—Congress fmds that— 
(1) private grazing land constitutes nearly V
2 of the non-
Federal land of the United States and is basic to the environ-
mental, social, and economic stability of rural communities; 
(2) private grazing land contains a complex set of inter-
actions among soil, water, air, plants, and animals; 
(3) grazing land constitutes the single largest watershed 
cover type in the United States and contributes significantly 
to the quality and quantity of water available for all of the 
many uses of the land; 
(4) private grazing land constitutes the most extensive 
wildlife habitat in the United States; 
(5) private grazing land can provide opportunities for 
improved nutrient management from land application of animal 
manures and other by-product nutrient resources; 
(6) owners and managers of private grazing land need 
to continue to recognize conservation problems when the prob-
lems arise and receive sound technical assistance to improve 
or conserve grazing land resources to meet ecological and eco-
nomic demands; 
(7) new science and technology must continually be made 
available in a practical manner so owners and managers of 
110 STAT. 1018 
PUBLIC LAW 104-127—APR. 4, 1996 
private grazing land may make informed decisions concerning 
vital grazing land resources; 
(8) agencies of the Department with private grazing land 
responsibilities are the agencies that have the expertise and 
experience to provide technical assistance, education, and 
research to owners and managers of private grazing land for 
the long-term productivity and ecological health of grazing land; 
(9) although competing demands on private grazing land 
resources are greater than ever before, assistance to private 
owners and managers of private grazing land is currently lim-
ited and does not meet the demand and basic need for ade-
quately sustaining or enhancing the private grazing land 
resources; and 
(10) private grazing land can be enhanced to provide many 
benefits to all citizens of the United States through voluntary 
cooperation among owners and managers of the land, local 
conservation districts, and the agencies of the Department 
responsible for providing assistance to owners and managers 
of land and to conservation districts. 
(b) PURPOSE.—It is the purpose of this section to authorize 
the Secretary to provide a coordinated technical, educational, and 
related assistance program to conserve and enhance private grazing 
land resources and provide related benefits to all citizens of the 
United States by— 
(1) establishing a coordinated and cooperative Federal, 
State, and local grazing conservation program for management 
of private grazing land; 
(2) strengthening technical, educational, and related assist-
ance programs that provide assistance to owners and managers 
of private grazing land; 
(3) conserving and improving wildlife habitat on private 
grazing land; 
(4) conserving and improving fish habitat and aquatic sys-
tems through grazing land conser\'ation treatment; 
(5) protecting and improving water quality; 
(6) improving the dependability and consistency of water 
supplies; 
(7) identifying and managing weed, noxious weed, and 
brush encroachment problems on private grazing land; and 
(8) integrating conservation planning and management 
decisions by owners and managers of private grazing land, 
on a voluntary basis. 
(c) DEFINITIONS.—In this section: 
(1) DEPARTMENT.—The term "Department" means the 
Department of Agriculture. 
(2) PRIVATE GRAZING LAND.—The term "private grazing 
land" means private. State-owned, tribally-owned, and any 
other non-federally owned rangeland, pastureland, grazed forest 
land, and hay land. 
(3) SECRETARY.—The term "Secretary" means the Secretary 
of Agriculture. 
(d) PRIVATE GRAZING LAND CONSERVATION ASSISTANCE.— 
(1) ASSISTANCE TO GRAZING LANDOWNERS AND OTHERS.— 
Subject to the availability of appropriations for this section, 
the Secretary shall establish a voluntary program to provide 
technical, educational, and related assistance to owners and 
managers of private grazing land and public agencies, through 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1019 
local conservation districts, to enable the landowners, man-
agers, and public agencies to voluntarily carry out activities 
that are consistent with this section, including— 
(A) maintaining and improving private grazing land 
and the multiple values and uses that depend on private 
grazing land; 
(B) implementing grazing land management tech-
nologies; 
(C) managing resources on private grazing land, includ-
ing— 
(i) planning, managing, and treating private graz-
ing land resources; 
(ii) ensuring the long-term sustainability of private 
grazing land resources; 
(iii) harvesting, processing, and marketing private 
grazing land resources; and 
(iv) identifying and managing weed, noxious weed, 
and brush encroachment problems; 
(D) protecting and improving the quality and quantity 
of water yields from private grazing land; 
(E) maintaining and improving wildlife and fish habitat 
on private grazing land; 
(F) enhancing recreational opportunities on private 
grazing land; 
(G) maintaining and improving the aesthetic character 
of private grazing lands; and 
(H) identifying the opportunities and encouraging the 
diversification of private grazing land enterprises. 
(2) PROGRAM ELEMENTS.— 
(A) FUNDING.—If funding is provided to carry out this 
section, it shall be provided through a specific line-item 
in the annual appropriations for the Natural Resources 
Conservation Service. 
(B) TECHNICAL ASSISTANCE AND EDUCATION.—Person-
nel of the Department trained in pasture and range 
management shall be made available under the program 
to deliver and coordinate technical assistance and education 
to owners and managers of private grazing land, at the 
request of the owners and managers. 
(e) GRAZING TECHNICAL ASSISTANCE SELF-HELP.— 
(1) FINDINGS.—Congress finds that— 
(A) there is a severe lack of technical assistance for 
farmers and ranchers who graze livestock; 
(B) Federal budgetary constraints preclude any signifi-
cant expansion, and may force a reduction of, current levels 
of technical support; and 
(C) farmers and ranchers have a history of coopera-
tively working together to address common needs in the 
promotion of their products and in the drainage of wet 
areas through drainage districts. 
(2) 
ESTABLISHMENT 
OF 
GRAZING 
DEMONSTRATION.—In 
accordance with paragraph (3), the Secretary may establish 
2 grazing management demonstration districts at the rec-
ommendation of the grazing lands conservation initiative steer-
ing committee. 
(3) PROCEDURE.— 
110 STAT. 1020 
PUBLIC LAW 104-127—APR. 4, 1996 
Establishment. 
16 u s e 3836a. 
Establishment. 
16 u s e 3830 
note. 
(A) PROPOSAL.—^Within a reasonable time after the 
submission of a request of an organization of farmers or 
ranchers engaged in grazing, the Secretary shall propose 
that a grazing management district be established. 
(B) FUNDING.—The terms and conditions of the funding 
and operation of the grazing management district shall 
be proposed by the producers. 
(C) APPROVAL.—The Secretary shall approve the pro-
posal if the Secretary determines that the proposal— 
(i) is reasonable; 
(ii) will promote sound grazing practices; and 
(iii) contains provisions similar to the provisions 
contained in the beef promotion and research order 
issued under section 4 of the Beef Research and 
Information Act (7 U.S.C. 2903) in effect on the date 
of enactment of this Act. 
(D) AREA INCLUDED.—The area proposed to be included 
in a grazing management district shall be determined by 
the Secretary on the basis of a petition by farmers or 
ranchers. 
(E) AUTHORIZATION.—The Secretary may use authority 
under the Agricultural Adjustment Act (7 U.S.C. 601 et 
seq.), reenacted with amendments by the Agricultural 
Marketing Agreement Act of 1937, to operate, on a dem-
onstration basis, a grazing management district. 
(F) ACTIVITIES.—The activities of a grazing manage-
ment district shall be scientifically sound activities, as 
determined by the Secretary in consultation with a tech-
nical advisory committee composed of ranchers, farmers, 
and technical experts. 
(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated to carry out this section— 
(1) $20,000,000 for fiscal year 1996; 
(2) $40,000,000 for fiscal year 1997; and 
(3) $60,000,000 for fiscal year 1998 and each subsequent 
fiscal year. 
SEC. 387. WILDLIFE HABITAT INCENTIVES PROGRAM. 
(a) IN GENERAL.—^The Secretary of Agriculture, in consultation 
with the State technical committees established under section 1261 
of the Food Security Act of 1985 (16 U.S.C. 3861), shall establish 
a program under the Natural Resources Conservation Service to 
be known as the "Wildlife Habitat Incentive Program". 
(b) COST-SHARE PAYMENTS.—^Under the program, the Secretary 
shall make cost-share payments to landowners to develop upland 
wildlife, wetland wildlife, threatened and endangered species, fish, 
and other types of wildlife habitat approved by the Secretary. 
(c) FUNDING.—To carry out this section, a total of $50,000,000 
shall be made available for fiscal years 1996 through 2002 from 
funds made available to carry out 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.). 
SEC. 388. FARMLAND PROTECTION PROGRAM. 
(a) IN GENERAL.—The Secretary of Agriculture shall establish 
and carry out a farmland protection program under which the 
Secretary shall purchase conservation easements or other interests 
in not less than 170,000, nor more than 340,000, acres of land 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1021 
with prime, unique, or other productive soil that is subject to 
a pending offer from a State or local government for the purpose 
of protecting topsoil by limiting nonagricultural uses of the land. 
(b) CONSERVATION PLAN.—Any highly erodible cropland for 
which a conservation easement or other interest is purchased under 
this section shall be subject to the requirements of a conservation 
plan that requires, at the option of the Secretary, the conversion 
of the cropland to less intensive uses. 
(c) 
FUNDING.—The 
Secretary 
shall 
use 
not 
more 
than 
$35,000,000 of the funds of the Commodity Credit Corporation 
to carry out this section. 
SEC. 389. INTERIM MORATORIUM ON BYPASS FLOWS. 
National Forest 
(a) MORATORIUM.—There shall be an 18-month moratorium 
water. 
on any Forest Service decision to require bypass flows or any 
16 USC 526 note. 
other relinquishment of the unimpaired use of a decreed water 
right as a condition of renewal or reissuance of a land use authoriza-
tion permit. 
(b) LIMITATIONS.—Subsection (a) shall not affect— 
(1) obligations or authority of the Secretary of Agriculture 
to protect public health and safety; and 
(2) obligations or authority under the Endangered Species 
Act of 1973 (16 U.S.C. 1531 et seq.), or applicable State law. 
(c) RULES OF CONSTRUCTION.— 
(1) EXISTING NON-FEDERAL WATER RIGHTS.—Nothing in this 
section prevents or inhibits the exercise of the use and operation 
of existing non-Federal water rights on or above the National 
Forest land that require land use authorization permits from 
the Forest Service to access water supply facilities. 
(2) 
RENEWAL OR REISSUANCE OF EXPIRING LAND USE 
AUTHORIZATION FOR DECREED WATER RIGHTS.—Nothing in this 
section prevents or inhibits the renewal or reissuance of expir-
ing land use authorizations for decreed water rights. The Forest 
Service may extend, as needed, any expiring land use authoriza-
tion for such time as is necessary to incorporate the results 
of the study authorized by subsection (d). 
(d) STUDY OF WATER RIGHTS ACROSS FEDERAL LANDS.— 
(1) ESTABLISHMENT.—Not later than 60 days after the date 
of enactment of this Act, there shall be established a Water 
Rights Task Force to study the subjects described in paragraph 
(3). 
(2) MEMBERSHIP.—The Task Force shall be composed of 
7 members appointed as follows: 
(A) 1 member shall be appointed by the Secretary 
of Agriculture. 
(B) 2 members shall be appointed by the Speaker of 
the House of Representatives and 1 member shall be 
appointed by the Minority Leader of the House of Rep-
resentatives. 
(C) 2 members shall be appointed by the Majority 
Leader of the Senate and 1 member shall be appointed 
by the Minority Leader of the Senate. 
(3) SUBJECTS TO BE STUDIED.—The Task Force shall study 
and make recommendations on— 
(A) whether Federal water rights should be acquired 
for environmental protection on National Forest land; 
n o STAT. 1022 
PUBLIC LAW 104-127—APR. 4, 1996 
(B) measures necessary to protect the free exercise 
of non-Federal water rights requiring easements and per-
mits from the Forest Service; 
(C) the protection of minimum instream flows for 
environmental and watershed management purposes on 
National Forest land through purchases or exchanges from 
willing sellers in accordance with State law; 
(D) the effects of any of the recommendations made 
under this paragraph on existing State laws, regulations, 
and customs of water usage; and 
(E) measures that would be useful in avoiding or resolv-
ing conflicts between the Forest Service's responsibilities 
for natural resource and environmental protection, the pub-
lic interest, and the property rights and interests of water 
holders with special use permits for water facilities, includ-
ing the study of the Federal acquisition of water rights, 
dispute resolution, mitigation, and compensation. 
(4) FINAL REPORT.—As soon as practicable, but not later 
than 1 year, after the date of enactment of this Act, the Task 
Force shall provide the final report of the Task Force to— 
(A) the Secretary of Agriculture; 
(B) the Speaker of the House of Representatives; 
(C) the President pro tempore of the Senate; 
(D) the Chairman of the Committee on Agriculture 
of the House of Representatives; 
(E) the Chairman of the Committee on Agriculture, 
Nutrition, and Forestry of the Senate; 
(F) the Chairman of the Committee on Resources of 
the House of Representatives; and 
(G) the Chairman of the Committee on Energy and 
Natural Resources of the Senate. 
(5) AUTHORIZATION OF FUNDS.—The Secretary of Agri-
culture shall use funds made available for salaries and adminis-
trative expenses of the Department of Agriculture to carry 
out this subsection. 
Florida. 
SEC. 390. EVERGLADES ECOSYSTEM RESTORATION. 
(a) IN GENERAL.—On July 1, 1996, out of any funds in the 
Treasury not otherwise appropriated, the Secretary of the Treasury 
shall provide $200,000,000 to the Secretary of the Interior to carry 
out this section. 
(b) ENTITLEMENT.—^The Secretary of the Interior (referred to 
in this section as the "Secretary")— 
(1) shall be entitled to receive the funds made available 
under subsection (a); 
(2) shall accept the funds; and 
(3) shall use the funds to— 
(A) conduct restoration activities in the Everglades 
ecosystem in South Florida, which shall include the acquisi-
tion of real property and interests in real property located 
within the Everglades ecosystem; and 
(B) fund resource protection and resource maintenance 
activities in the Everglades ecosystem. 
(c) SAVINGS PROVISION.—Nothing in this subsection precludes 
the Secretary from transferring funds to the Army Corps of Engi-
neers, the State of Florida, or the South Florida Water Management 
District to carry out subsection (b)(3). 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1023 
(d) DEADLINE.—The Secretary shall use the funds made avail-
able under subsection (a) for restoration activities referred to in 
subsection (b)(3) not later than December 31, 1999. 
(e) REPORT TO CONGRESS.—For each of calendar years 1996 
through 1999, the Secretary shall submit an annual report to Con-
gress describing all activities carried out under subsection (b)(3). 
(f) 
SEPARATE AND 
ADDITIONAL 
EVERGLADES RESTORATION 
ACCOUNT.— 
(1) ESTABLISHMENT.—There is established in the Treasury 
a special account (to be known as the "Everglades Restoration 
Account"), which shall consist of such funds as may be deposited 
in the account under paragraph (2). The account shall be sepa-
rate, and in addition to, funds deposited in the Treasury under 
subsection (a). 
(2) SOURCE OF FUNDS FOR ACCOUNT.— 
(A) PROCEEDS FROM SURPLUS PROPERTY.— 
(i) IN GENERAL.—Subject to subparagraph (B), the 
Administrator shall deposit in the special account all 
funds received by the Administrator, on or after the 
date of enactment of this Act, from the disposal pursu-
ant to the Federal Property and Administrative Serv-
ices Act of 1949 (40 U.S.C. 471 et seq.) of surplus 
real property located in the State of Florida. 
(ii) 
AVAILABILITY AND DISPOSITION OF FEDERAL 
LAND.— 
(I) IDENTIFICATION.—^Any Federal real prop-
erty located in the State of Florida (excluding lands 
under the administrative jurisdiction of the Sec-
retary that are set aside for conservation purposes) 
shall be identified for disposal or exchange under 
this subsection and shall be presumed available 
for purposes of this subsection unless the head 
of the agency controlling the property determines 
that there is a compelling program need for any 
property identified by the Secretary. 
(II) AVAILABILITY.—Property identified by the 
Secretarj^ for which there is no demonstrated 
compelling program need shall, not later than 90 
days after a request by the Secretary, be reported 
to the Administrator and shall be made available 
to the Administrator who shall consider the prop-
erty to be surplus property for purposes of the 
Federal Property and Administrative Services Act 
of 1949 (40 U.S.C. 471 et seq.). 
(III) 
PRIORITIZATION 
OF 
DISPOSITION.—The 
Administrator may prioritize the disposition of 
property made available under this subparagraph 
to permit the property to be sold as quickly as 
practicable in a manner that is consistent with 
the best interests of the Federal Government. 
(B) LIMIT ON TOTAL AMOUNT OF DEPOSITS.—The total 
amount of funds deposited in the special account under 
subparagraph (A) shall not exceed $100,000,000. 
(C) EFFECT ON CLOSURE OF MILITARY INSTALLATIONS.— 
Nothing in this section alters the disposition of any pro-
ceeds arising from the disposal of real property pursuant 
to a base closure law. 
110 STAT. 1024 
PUBLIC LAW 104-127—APR. 4, 1996 
(3) USE OF SPECIAL ACCOUNT.—Funds in the special account 
shall be available to the Secretary until expended under this 
paragraph. The Secretary shall use funds in the special account 
to assist in the restoration of the Everglades ecosystem in 
South Florida through— 
(A) subject to paragraph (4), the acquisition of real 
property and interests in real property located within the 
Everglades ecosystem; and 
(B) the funding of resource protection and resource 
maintenance activities in the Everglades ecosystem. 
(4) STATE CONTRIBUTION.—The Secretary may not expend 
any funds from the special account to acquire a parcel of 
real property, or an interest in a parcel of real property, under 
paragraph (3)(A) unless the Secretary obtains, or has previously 
obtained, a contribution from the State of Florida in an amount 
equal to not less than 50 percent of the appraised value of 
the parcel or interest to be acquired, as determined by the 
Secretary. 
(5) DEFINITIONS.—In this subsection: 
(A) ADMINISTRATOR.—The term "Administrator" means 
the Administrator of General Services. 
(B) BASE CLOSURE LAW.—The term "base closure law" 
means each of the following: 
(i) The Defense Base Closure and Realignment 
Act of 1990 (part A of title XXIX of Public Law 101-
510; 10 U.S.C. 2687 note). 
(ii) Title II of the Defense Authorization Amend-
ments and Base Closure and Realignment Act (Public 
Law 100-526; 10 U.S.C. 2687 note). 
(iii) Section 2687 of title 10, United States Code. 
(iv) Any other similar law enacted after the date 
of enactment of this Act. 
(C) EVERGLADES ECOSYSTEM.—The term "Everglades 
ecosystem" means the Florida Everglades Restoration area 
that extends from the Kissimmee River basin to Florida 
Bay. 
(D) EXCESS PROPERTY.—The term "excess property" has 
the meaning provided in section 3 of the Federal Property 
and Administrative Services Act of 1949 (40 U.S.C. 472). 
(E) EXECUTIVE AGENCY.—The term "executive agency" 
has the meaning provided in section 3 of the Federal Prop-
erty and Administrative Services Act of 1949 (40 U.S.C. 
472). 
(F) SPECIAL ACCOUNT.—The term "special account" 
means the Everglades Restoration Account established 
under paragraph (1). 
(G) SURPLUS PROPERTY.—The term "surplus property" 
has the meaning provided in section 3 of the Federal Prop-
erty and Administrative Services Act of 1949 (40 U.S.C. 
472). 
(g) REPORT TO DETERMINE THE FEASIBILITY OF ADDITIONAL 
LAND ACQUISITION AND RESTORATION ACTIVITIES.— 
(1) IN GENERAL.—^The Secretary shall conduct an investiga-
tion to determine what, if any, unreserved and unappropriated 
Federal lands (or mineral interests in any such lands) under 
the administrative jurisdiction of the Secretary are suitable 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1025 
for disposal or exchange for the purpose of conducting restora-
tion activities in the Everglades region. 
(2) CONSERVATION LANDS.—No lands under the administra-
tive jurisdiction of the Secretary that are set aside for conserva-
tion purposes shall be identified for disposal or exchange under 
this subsection. 
(3) FLORIDA.—In carrying out this subsection, the Secretary 
shall, to the maximum extent practicable, determine which 
lands and mineral interests located within the State of Florida 
are suitable for disposal or exchange before making the deter-
mination for eligible lands or interests in other States. 
(4) PUBLIC ACCESS.—In carrying out this subsection, the 
Secretary shall consider that in disposing of lands, the Sec-
retary shall retain such interest in the lands as may be nec-
essary to ensure that the general public is not precluded from 
reasonable access to the lands for purposes of fishing, hunting, 
or other recreational uses. 
(5) REPORT.—Not later than 1 year after the date of enact-
ment of this Act, the Secretary shall submit a report to the 
Committee on Resources of the House of Representatives and 
the Committee on Elnergy and Natural Resources of the Senate 
describing the results of the investigation conducted under 
this subsection. The report shall describe the specific parcels 
identified under this subsection, establish the priorities for 
disposal or exchange among the parcels, and estimate the val-
ues of the parcels. 
SEC. 391. AGRICULTURAL AIR QUALITY RESEARCH OVERSIGHT. 
7 USC 5405. 
(a) FINDINGS.—Congress finds that— 
(1) various studies have alleged that agriculture is a source 
of PM-10 emissions; 
(2) many of these studies have often been based on erro-
neous data; 
(3) Federal research activities are currently being con-
ducted by the Department of Agriculture to determine the 
true extent to which agricultural activities contribute to air 
pollution and to determine cost-effective ways in which the 
agricultural industry can reduce any pollution that exists; and 
(4) any Federal policy recommendations that may be issued 
by any Federal agency to address air pollution problems related 
to agriculture or any other industrial activity should be based 
on sound scientific findings that are subject to adequate peer 
review and should take into account economic feasibility. 
(b) PURPOSE.—The purpose of this section is to encourage the 
Secretary of Agriculture to continue to strengthen vital research 
efforts related to agricultural air quality. 
(c) OVERSIGHT COORDINATION.— 
(1) 
INTERGOVERNMENTAL COOPERATION.—The 
Secretary 
shall, to the maximum extent practicable with respect to the 
Department of Agriculture and other Federal departments and 
agencies, ensure intergovernmental cooperation in research 
activities related to agricultural air quality and avoid duplica-
tion of the activities. 
(2) CORRECT DATA.—The Secretary shall, to the maximum 
extent practicable, ensure that the results of any research 
related to agricultural air quality conducted by Federal agencies 
110 STAT. 1026 
PUBLIC LAW 104-127—APR. 4, 1996 
not report erroneous data with respect to agricultural air qual-
ity, 
(d) TASK FORCE.— 
(1) ESTABLISHMENT.—The Chief of the National Resources 
Conservation Service shall establish a task force to address 
agricultural air quality issues. 
(2) COMPOSITION.—The task force shall be comprised of 
employees of the Department of Agriculture, industry represent-
atives, and other experts in the fields of agriculture and air 
quality. 
(3) DUTIES.—The task force shall advise the Secretary with 
respect to the role of the Secretary for providing oversight 
and coordination related to agricultural air quality. 
TITLE IV—NUTRITION ASSISTANCE 
SEC. 401. FOOD STAJVIP PROGRAM. 
(a) 
DISQUALIFICATION OF A STORE 
OR 
CONCERN.—Section 
12(b)(3)(B) of the Food Stamp Act of 1977 (7 U.S.C. 2021(b)(3)(B)) 
is amended— 
(1) by striking the second parenthetical; and 
(2) by striking "; or" and inserting the following: ", including 
evidence that— 
"(i) the ownership of the store or food concern 
was not aware of, did not approve of, did not benefit 
from, and was not involved in the conduct of the viola-
tion; and 
"(ii)(I) the management of the store or food concern 
was not aware of, did not approve of, did not benefit 
from, and was not involved in the conduct of the viola-
tion; or 
"(II) the management was aware of, approved of, 
benefited from, or was involved in the conduct of no 
more than 1 previous violation by the store or food 
concern; or". 
(b) EMPLOYMENT AND TRAINING.—Section 16(h)(1) of the Food 
Stamp Act of 1977 (7 U.S.C. 2025(h)(1)) is amended by striking 
"1995" each place it appears and inserting "2002". 
(c) AUTHORIZATION OF PILOT PROJECTS.—The last sentence of 
section 17(b)(1)(A) of the Food Stamp Act of 1977 (7 U.S.C. 
2026(b)(1)(A)) is amended by striking "1995" and inserting "2002". 
(d) OUTREACH DEMONSTRATION PROJECTS.—The first sentence 
of section 170")(1)(A) of the Food Stamp Act of 1977 (7 U.S.C. 
2026(j)(l)(A)) is amended by striking "1995" and inserting "2002". 
(e) AUTHORIZATION FOR APPROPRIATIONS.—The first sentence 
of section 18(a)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
2027(a)(1)) is amended by striking "1995" and inserting "1997". 
(f) REAUTHORIZATION OF PUERTO RICO NUTRITION ASSISTANCE 
PROGRAM.—The first sentence of section 19(a)(1)(A) of the Food 
Stamp Act of 1977 (7 U.S.C. 2028(a)(1)(A)) is amended by striking 
"$974,000,000" and all that follows through "fiscal year 1995" and 
inserting "$1,143,000,000 for fiscal year 1996, $1,174,000,000 for 
fiscal year 1997, $1,204,000,000 for fiscal year 1998, $1,236,000,000 
for 
fiscal 
year 
1999, $1,268,000,000 
for 
fiscal 
year 
2000, 
$1,301,000,000 for fiscal year 2001, and $1,335,000,000 for fiscal 
year 2002". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1027 
(g) AMERICAN SAMOA.—The Food Stamp Act of 1977 (7 U.S.C. 
2011 et seq.) is amended by adding at the end the following: 
"SEC. 24. TERRITORY OF AMERICAN SAMOA. 
7 USC 2033. 
"Effective October 1, 1995, from amounts made available to 
carry out this Act, the Secretary shall pay to the Territory of 
American Samoa not more than $5,300,000 for each of fiscal years 
1996 through 2002 to finance 100 percent of the expenditures 
for the fiscal year for a nutrition assistance program extended 
under section 601(c) of Public Law 96-597 (48 U.S.C. 1469d(c)).". 
(h) ASSISTANCE FOR COMMUNITY FOOD PROJECTS.—The Food 
Stamp Act of 1977 (7 U.S.C. 2011 et seq.) (as amended by subsection 
(g)) is amended by adding at the end the following: 
"SEC. 25. ASSISTANCE FOR COMMUNITY FOOD PROJECTS. 
7 USC 2034. 
"(a) DEFINITION OF COMMUNITY FOOD PROJECTS.—In this sec-
tion, the term 'community food project' means a community-based 
project that requires a 1-time infusion of Federal assistance to 
become self-sustaining and that is designed to— 
"(1) meet the food needs of low-income people; 
"(2) increase the self-reliance of communities in providing 
for their own food needs; and 
"(3) promote comprehensive responses to local food, farm, 
and nutrition issues. 
"(b) AUTHORITY TO PROVIDE ASSISTANCE.— 
"(1) IN GENERAL.—From amounts made available to carry 
out this Act, the Secretary may make grants to assist eligible 
private nonprofit entities to establish and carry out community 
food projects. 
"(2) LIMITATION ON GRANTS.—The total amount of funds 
provided as grants under this section may not exceed— 
"(A) $1,000,000 for fiscal year 1996; and 
"(B) $2,500,000 for each of fiscal years 1997 through 
2002. 
"(c) ELIGIBLE ENTITIES.—To be eligible for a grant under sub-
section (b), a private nonprofit entity must— 
"(1) have experience in the area of— 
"(A) community food work, particularly concerning 
small and medium-sized farms, including the provision of 
food to people in low-income communities and the develop-
ment of new markets in low-income communities for agri-
cultural producers; or 
"(B) job training and business development activities 
for food-related activities in low-income communities; 
"(2) demonstrate competency to implement a project, pro-
vide fiscal accountability, collect data, and prepare reports and 
other necessary documentation; and 
"(3) demonstrate a willingness to share information with 
researchers, practitioners, and other interested parties. 
"(d) PREFERENCE FOR CERTAIN PROJECTS.—In selecting commu-
nity food projects to receive assistance under subsection (b), the 
Secretary shall give a preference to projects designed to— 
"(1) develop linkages between 2 or more sectors of the 
food system; 
"(2) support the development of entrepreneurial projects; 
"(3) develop innovative linkages between the for-profit and 
nonprofit food sectors; or 
110 STAT. 1028 
PUBLIC LAW 104-127—APR. 4, 1996 
"(4) encourage long-term planning activities and multi-sys-
tem, interagency approaches. 
"(e) MATCHING FUNDS REQUIREMENTS.— 
"(1) REQUIREMENTS.—The Federal share of the cost of 
establishing or carrying out a community food project that 
receives assistance under subsection (b) may not exceed 50 
percent of the cost of the project during the term of the grant. 
"(2) CALCULATION.—In providing for the non-Federal share 
of the cost of carrying out a community food project, the entity 
receiving the grant shall provide for the share through a pay-
ment in cash or in kind, fairly evaluated, including facilities, 
equipment, or services. 
"(3) SOURCES.—An entity may provide for the non-Federal 
share through State government, local government, or private 
sources. 
"(f) TERM OF GRANT.— 
"(1) SINGLE GRANT.—^A community food project may be 
supported by only a single grant under subsection (b). 
"(2) TERM.—^The term of a grant under subsection (b) may 
not exceed 3 years. 
"(g) TECHNICAL ASSISTANCE AND RELATED INFORMATION.— 
"(1) TECHNICAL ASSISTANCE.—In carrying out this section, 
the Secretary may provide technical assistance regarding 
community food projects, processes, and development to an 
entity seeking the assistance. 
"(2) SHARING INFORMATION.— 
"(A) IN GENERAL.—The Secretary may provide for the 
sharing of information concerning community food projects 
and issues among and between government, private for-
profit and nonprofit groups, and the public through publica-
tions, conferences, and other appropriate forums. 
"(B) OTHER INTERESTED PARTIES.—The Secretary 
may 
share information concerning community food projects with 
researchers, practitioners, and other interested parties. 
"(h) EVALUATION.— 
"(1) IN GENERAL.—The Secretary shall provide for the 
evaluation of the success of community food projects supported 
using funds under this section. 
"(2) REPORT.—Not later than January 30, 2002, the Sec-
retary shall submit a report to Congress regarding the results 
of the evaluation.". 
SEC. 402. COMMODITY DISTRIBUTION PROGRAM; COMMODITY SUPPLE-
MENTAL FOOD PROGRAM. 
(a) REAUTHORIZATION.—The first sentence of section 4(a) of 
the Agriculture and Consumer Protection Act of 1973 (Public Law 
93-86; 7 U.S.C. 612c note) is amended by striking "1995" and 
inserting "2002". 
(b) FUNDING.—Section 5 of the Agriculture and Consumer 
Protection Act of 1973 (PubHc Law 93-86; 7 U.S.C. 612c note) 
is amended— 
(1) in subsection (a)(2), by striking "1995" and inserting 
"2002"; 
(2) in subsection (d)(2), by striking "1995" and inserting 
"2002"; and 
(3) by adding at the end the following: 
PUBLIC Li^W 104-127—APR. 4, 1996 
110 STAT. 1029 
"(1) CARRIED-OVER FUNDS.—Not more than 20 percent of any 
commodity supplemental food program food funds carried over 
under this section shall be available for administrative expenses 
of the program.". 
SEC. 403. EMERGENCY FOOD ASSISTANCE PROGRAM. 
(a) REAUTHORIZATION.—The first sentence of section 204(a)(1) 
of the Emergency Food Assistance Act of 1983 (Public Law 98-
8; 7 U.S.C. 612c note) is amended by striking "1995" and inserting 
"2002". 
(b) PROGRAM TERMINATION.—Section 212 of the Emergency 
Food Assistance Act of 1983 (Public Law 98-8; 7 U.S.C. 612c note) 
is amended by striking "1995" and inserting "2002". 
(c) REQUIRED PURCHASES OF COMMODITIES.—Section 214 of the 
Emergency Food Assistance Act of 1983 (Public Law 98-8; 7 U.S.C. 
612c note) is amended— 
(1) in the first sentence of subsection (a), by striking "1995" 
and inserting "2002"; and 
(2) in subsection (e), by striking "1995" each place it 
appears and inserting "2002". 
SEC. 404. SOUP KITCHEN AJ^JD FOOD BANK PROGRAM. 
Section 110 of the Hunger Prevention Act of 1988 (Public Law 
100-435; 7 U.S.C. 612c note) is amended— 
(1) in the first sentence of subsection (a), by striking "1995" 
and inserting "2002"; and 
(2) in subsection (c)(2)— 
(A) in the paragraph heading, by striking "1992 
THROUGH 1995" and inserting "SUBSEQUENT"; and 
(B) by striking "1995" each place it appears and insert-
ing "2002". 
SEC. 405. N A T I O N A L COMMODITY PROCESSING. 
The first sentence of section 1114(a)(2)(A) of the Agriculture 
and Food Act of 1981 (7 U.S.C. 1431e(2)(A)) is amended by striking 
" 1995" and inserting "2002". 
TITLE V—AGRICULTURAL PROMOTION 
Subtitle A—Commodity Promotion and 
Evaluation 
SEC. 501. COMMODITY PROMOTION AND EVALUATION. 
7 USC 7401. 
(a) COMMODITY PROMOTION LAW DEFINED.—In this section, the 
term "commodity promotion law" means a Federal law that provides 
for the establishment and operation of a promotion program regard-
ing an agricultural commodity that includes a combination of pro-
motion, research, industry information, or consumer information 
activities, is funded by mandatory assessments on producers or 
processors, and is desig:ned to maintain or expand markets and 
uses for the commodit}^ (as determined by the Secretary). The 
term includes— 
(1) the marketing promotion provisions under section 
8c(6)(I) of the Agricultural Adjustment Act (7 U.S.C. 608c(6)(I)), 
reenacted with amendments by the Agricultural Marketing 
Agreement Act of 1937; 
110 STAT. 1030 
PUBLIC LAW 104-127—APR. 4, 1996 
(2) Public Law 89-502 (7 U.S.C. 2101 et seq.); 
(3) title III of Public Law 91-670 (7 U.S.C. 2611 et seq.); 
(4) Public Law 93-428 (7 U.S.C. 2701 et seq.); 
(5) Public Law 94-294 (7 U.S.C. 2901 et seq.); 
(6) subtitle B of title I of Public Law 98-180 (7 U.S.C. 
4501 et seq.); 
(7) Public Law 98-590 (7 U.S.C. 4601 et seq.); 
(8) subtitle B of title XVI of Public Law 99-198 (7 U.S.C. 
4801 et seq.); 
(9) subtitle C of title XVI of Public Law 99-198 (7 U.S.C. 
4901 et seq.); 
(10) subtitle B of title XIX of Public Law 101-624 (7 U.S.C. 
6101 et seq.); 
(11) subtitle E of title XIX of Public Law 101-624 (7 U.S.C. 
6301 et seq.); 
(12) subtitle H of title XIX of Public Law 101-624 (7 
U.S.C. 6401 et seq.); 
(13) Public Law 103-190 (7 U.S.C. 6801 et seq.); 
(14) Public Law 103-407 (7 U.S.C. 7101 et seq.); 
(15) subtitle B; 
(16) subtitle C; 
(17) subtitle D; or 
(18) subtitle E. 
(b) FINDINGS.—Congress finds the following: 
(1) It is in the national public interest and vital to the 
welfare of the agricultural economy of the United States to 
maintain and expand existing markets and develop new mar-
kets and uses for agricultural commodities through industry-
funded, Government-supervised, generic commodity promotion 
programs established under commodity promotion laws. 
(2) These generic commodity promotion programs, funded 
by the agricultural producers or processors who most directly 
reap the benefits of the programs and supervised by the Sec-
retary of Agriculture, provide a unique opportunity for produc-
ers and processors to inform consumers about their products. 
(3) The central congressional purpose underlying each 
commodity promotion law has always been to maintain and 
expand markets for the agricultural commodity covered by the 
law, rather than to maintain or expand the share of those 
markets held by any individual producer or processor. 
(4) The commodity promotion laws were neither designed 
nor intended to prohibit or restrict, and the promotion programs 
established and funded pursuant to these laws do not prohibit 
or restrict, individual advertising or promotion of the covered 
commodities by any producer, processor, or group of producers 
or processors. 
(5) It has never been the intent of Congress for the generic 
commodity promotion programs established and funded by the 
commodity promotion laws to replace the individual advertising 
and promotion efforts of producers or processors. 
(6) An individual producer's or processor's own advertising 
initiatives are typically designed to increase the share of the 
market held by that producer or processor rather than to 
increase or expand the overall size of the market. 
(7) In contrast, a generic commodity promotion program 
is intended and designed to maintain or increase the overall 
demand for the agricultural commodity covered by the program 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1031 
and increase the size of the market for that commodity, often 
by utiHzing promotion methods and techniques that individual 
producers and processors typically are unable, or have no incen-
tive, to employ. 
(8) The commodity promotion laws establish promotion pro-
grams that operate as "self-help" mechanisms for producers 
and processors to fund generic promotions for covered commod-
ities which, under the required supervision and oversight of 
the Secretary of Agriculture— 
(A) further specific national governmental goals, as 
established by Congress; and 
(B) produce nonideological and commercial communica-
tion the purpose of which is to further the governmental 
policy and objective of maintaining and expanding the mar-
kets for the covered commodities. 
(9) While some commodity promotion laws grant a producer 
or processor the option of crediting individual advertising con-
ducted by the producer or processor for all or a portion of 
the producer's or processor's marketing promotion assessments, 
all promotion programs established under the commodity pro-
motion laws, both those programs that permit credit for individ-
ual advertising and those programs that do not contain such 
provisions, are very narrowly tailored to fulfill the congressional 
purposes of the commodity promotion laws without impairing 
or infringing the legal or constitutional rights of any individual 
producer or processor. 
(10) These generic commodity promotion programs are of 
particular benefit to small producers who often lack the 
resources or market power to advertise on their own and who 
are otherwise often unable to benefit from the economies of 
scale available in promotion and advertising. 
(11) Periodic independent evaluation of the effectiveness 
of these generic commodity promotion programs will assist Con-
gress and the Secretary of Agriculture in ensuring that the 
objectives of the programs are met. 
(c) 
INDEPENDENT 
EVALUATION 
OF 
PROMOTION 
PROGRAM 
EFFECTIVENESS.—Except as otherwise provided by law, each 
commodity board established under the supervision and oversight 
of the Secretary of Agriculture pursuant to a commodity promotion 
law shall, not less often than every 5 years, authorize and fund, 
from funds otherwise available to the board, an independent evalua-
tion of the effectiveness of the generic commodity promotion pro-
grams and other programs conducted by the board pursuant to 
a commodity promotion law. The board shall submit to the Sec- Public 
retary, and make available to the public, the results of each periodic 
information. 
independent evaluation conducted under this subsection. 
(d) ADMINISTRATIVE COSTS.—The Secretary shall annually pro-
vide to the Committee on Agriculture of the House of Representa-
tives and the Committee on Agriculture, Nutrition, and Forestry 
of the Senate information on administrative expenses on programs 
established under commodity promotion laws. 
110 STAT. 1032 
PUBLIC LAW 104-127—APR. 4, 1996 
c
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Subtltlc B—Issuaiice of Orders for Pro-
Promotion, 
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A 
Research, and 
mOtlOll, KeSearCh, and InrOrmatlOn Ac-
information Act 
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of 1996 
tivities Regarding Agricultural Commod-
ities 
7 u s e 7401 note. 
SEC. 511. SHORT TITLE. 
This subtitle may be cited as the "Commodity Promotion, 
Research, and Information Act of 1996". 
7 u s e 7411. 
SEC. 512. FINDINGS AND PURPOSE. 
(a) FINDINGS.—Congress finds the following: 
(1) The production of agricultural commodities plays a 
significant role in the economy of the United States. Thousands 
of producers in the United States are involved in the production 
of agricultural 
commodities, and such 
commodities are 
consumed by millions of people throughout the United States 
and foreign countries. 
(2) Agricultural commodities must be of high quality, read-
ily available, handled properly, and marketed efficiently to 
ensure that consumers have an adequate supply. 
(3) The maintenance and expansion of existing markets 
and the development of new markets for agricultural commod-
ities through generic commodity promotion, research, and 
information programs are vital to the welfare of persons 
engaged in the production, marketing, and consumption of such 
commodities, as well as to the general economy of the United 
States. 
(4) Generic promotion, research, and information activities 
for agricultural commodities play a unique role in advancing 
the demand for such commodities, since such activities increase 
the total market for a product to the benefit of consumers 
and all producers. These generic activities complement branded 
advertising initiatives, which are aimed at increasing the mar-
ket share of individual competitors, and are of particular benefit 
to small producers who lack the resources or market power 
to advertise on their own. These generic activities do not impede 
the branded advertising efforts of individual firms, but instead 
increase general market demand for an agricultural commodity 
using methods that individual companies do not have the incen-
tive to employ. 
(5) Generic promotion, research, and information activities 
for agricultural commodities, paid by the producers and others 
in the industry who reap the benefits of such activities, provide 
a unique opportunity for producers to inform consumers about 
a particular agricultural commodity. 
(6) It is important to ensure that generic promotion, 
research, and information activities for agricultural commod-
ities be carried out in an effective and coordinated manner 
designed to strengthen the position of the commodities in the 
marketplace and to maintain and expand their markets and 
uses. Independent evaluation of the effectiveness of the generic 
promotion activities of these programs will assist the Secretary 
of Agriculture and Congress in ensuring that these objectives 
are met. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1033 
(7) 
The 
cooperative 
development, 
financing, 
and 
implementation of a coordinated national program of research, 
promotion, and information regarding agricultural commodities 
are necessary to maintain and expand existing markets and 
to develop new markets for these commodities. 
(8) Agricultural commodities move in interstate and foreign 
commerce, and agricultural commodities and their products 
that do not move in such channels of commerce directly burden 
or affect interstate commerce in agricultural commodities and 
their products. 
(9) Commodity promotion programs have the ability to 
provide significant conservation benefits to producers and the 
public. 
(b) PURPOSE.—The purpose of this subtitle is to authorize the 
establishment, through the exercise by the Secretary of Agriculture 
of the authority provided in this subtitle, of an orderly program 
for developing, financing, and carrying out an effective, continuous, 
and coordinated program of generic promotion, research, and 
information regarding agricultural commodities designed to— 
(1) strengthen the position of agricultural commodity indus-
tries in the marketplace; 
(2) maintain and expand existing domestic and foreign 
markets and uses for agricultural commodities; 
(3) develop new markets and uses for agricultural commod-
ities; or 
(4) assist producers in meeting their conservation objec-
tives. 
(c) RULE OF CONSTRUCTION.—Nothing in this subtitle provides 
for the control of production or otherwise limits the right of any 
person to produce, handle, or import an agricultural commodity. 
SEC. 513. DEFINITIONS. 
7 USC 7412. 
In this subtitle (unless the context otherwise requires): 
(1) AGRICULTURAL COMMODITY.—The term "agricultural 
commodity" means— 
(A) agricultural, horticultural, viticultural, and dairy 
products; 
(B) livestock and the products of livestock; 
(C) the products of poultry and bee raising; 
(D) the products of forestry; 
(E) other commodities raised or produced on farms, 
as determined appropriate by the Secretary; and 
(F) products processed or manufactured from products 
specified in the preceding subparagraphs, as determined 
appropriate by the Secretary. 
(2) BOARD.—^The term "board" means a board established 
under an order issued under section 514. 
(3) CONFLICT OF INTEREST.—The term "conflict of interest" 
means a situation in which a member or employee of a board 
has a direct or indirect financial interest in a person that 
performs a service for, or enters into a contract with, a board 
for anything of economic value. 
(4) DEPARTMENT.—The term "Department" means the 
Department of Agriculture. 
(5) FIRST HANDLER.—The term "first handler" means the 
first person who buys or takes possession of an agricultural 
commodity from a producer for marketing. If a producer mar-
29-194 O - 96 - 34 :QL 3 Parti 
110 STAT. 1034 
PUBLIC LAW 104-127—APR. 4, 1996 
kets the agricultural commodity directly to consumers, the pro-
ducer shall be considered to be the first handler with respect 
to the agricultural commodity produced by the producer. 
(6) IMPORTER.—The term "importer" means any person who 
imports an agricultural commodity fi-om outside the United 
States for sale in the United States as a principal or as an 
agent, broker, or consignee of any person. 
(7) INFORMATION.—The term "information" means informa-
tion and programs that are designed to increase— 
(A) efficiency in processing; and 
(B) the development of new markets, marketing strate-
gies, increased marketing efficiency, and activities to 
enhance the image of agricultural commodities on a 
national or international basis. 
(8) MARKET.—The term "market" means to sell or to other-
wise dispose of an agricultural commodity in interstate, foreign, 
or intrastate commerce. 
(9) ORDER.—The term "order" means an order issued by 
the Secretary under section 514 that provides for a program 
of generic promotion, research, and information regarding agri-
cultural commodities designed to— 
(A) strengthen the position of agricultural commodity 
industries in the marketplace; 
(B) maintain and expand existing domestic and foreign 
markets and uses for agricultural commodities; 
(C) develop new markets and uses for agricultural 
commodities; or 
(D) assist producers in meeting their conservation 
objectives. 
(10) PERSON.—^The term "person" means any individual, 
group of individuals, partnership, corporation, association, 
cooperative, or any other legal entity. 
(11) PRODUCER.—The term "producer" means any person 
who is engaged in the production and sale of an agricultural 
commodity in the United States and who owns, or shares the 
ownership and risk of loss of, the agricultural commodity. 
(12) PROMOTION.—The term "promotion" means any action 
taken by a board under an order, including paid advertising, 
to present a favorable image of an agricultural commodity 
to the public to improve the competitive position of the agricul-
tural commodity in the marketplace and to stimulate sales 
of the agricultural commodity. 
(13) RESEARCH.—^The term "research" means any type of 
test, study, or analysis designed to advance the image, desirabil-
ity, use, marketability, production, product development, or 
quality of an agricultural commodity. 
(14) SECRETARY.—The term "Secretary" means the Sec-
retary of Agriculture. 
(15) STATE.—The term "State" means any of the States, 
the District of Columbia, the Commonwealth of Puerto Rico, 
or any territory or possession of the United States. 
(16) SUSPEND.—The term "suspend" means to issue a rule 
under section 553 of title 5, United States Code, to temporarily 
prevent the operation of an order during a particular period 
of time specified in the rule. 
(17) TERMINATE.—The term "terminate" means to issue 
a rule under section 553 of title 5, United States Code, to 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1035 
cancel permanently the operation of an order beginning on 
a date certain specified in the rule. 
(18) UNITED STATES.—The term "United States" means 
collectively the 50 States, the District of Columbia, the 
Commonwealth of Puerto Rico and the territories and posses-
sions of the United States. 
SEC. 514. ISSUANCE OF ORDERS. 
7 USC 7413. 
(a) ISSUANCE AUTHORIZED.— 
(1) IN GENERAL.—To effectuate the purpose of this subtitle, 
the Secretary may issue, and amend from time to time, orders 
applicable to— 
(A) the producers of an agricultural commodity; 
(B) the first handlers of the agricultural commodity 
and other persons in the marketing chain as appropriate; 
and 
(C) the importers of the agricultural commodity, if 
imports of the agricultural commodity are subject to assess-
ment under section 516(f). 
(2) NATIONAL SCOPE.—Each order issued under this section 
shall be national in scope. 
(b) PROCEDURE FOR ISSUANCE.— 
(1) DEVELOPMENT OR RECEIPT OF PROPOSED ORDER.—A pro-
posed order with respect to an agricultural commodity may 
be— 
(A) prepared by the Secretary at any time; or 
(B) submitted to the Secretary by— 
(i) an association of producers of the agricultural 
commodity; or 
(ii) any other person that may be affected by the 
issuance of an order with respect to the agricultural 
commodity. 
(2) CONSIDERATION OF PROPOSED ORDER.—If the Secretary 
Federal Register, 
determines that a proposed order is consistent with and will publication. 
effectuate the purpose of this subtitle, the Secretary shall pub-
lish the proposed order in the Federal Register and give due 
notice and opportunity for public comment on the proposed 
order. 
(3) EXISTENCE OF OTHER ORDERS.—In deciding whether 
a proposal for an order is consistent with and will effectuate 
the purpose of this subtitle, the Secretary may consider the 
existence of other Federal promotion, research, and information 
programs or orders issued or developed pursuant to any other 
law. 
(4) PREPARATION OF FINAL ORDER.—After notice and oppor-
tunity for public comment under paragraph (2) regarding a 
proposed order, the Secretary shall take into consideration the 
comments received in preparing a final order. The Secretary 
shall ensure that the final order is in conformity with the 
terms, conditions, and requirements of this subtitle. 
(c) ISSUANCE AND EFFECTIVE DATE.—If the Secretary deter-
mines that the final order developed with respect to an agricultural 
commodity is consistent with and will effectuate the purpose of 
this subtitle, the Secretai-y shall issue the final order. Except in 
the case of an order for which an initial referendum is conducted 
under section 518(a), the final order shall be issued and become 
110 STAT. 1036 
PUBLIC LAW 104-127—APR. 4, 1996 
effective not later than 270 days after the date of publication 
of the proposed order that was the basis for the final order. 
(d) AMENDMENTS.—From time to time the Secretary may amend 
any order, consistent with the requirements of section 523. 
7 use 7414. 
SEC. 515. REQUIRED TERMS IN ORDERS. 
(a) IN GENERAL.—Each order shall contain the terms and condi-
tions specified in this section. 
(b) BOARD.— 
(1) ESTABLISHMENT.—Each order shall establish a board 
to carry out a program of generic promotion, research, and 
information regarding the agricultural commodity covered by 
the order and intended to efiectuate the purpose of this subtitle. 
(2) BOARD MEMBERSHIP.— 
(A) NUMBER OF MEMBERS.—Each board shall consist 
of the number of members considered by the Secretary, 
in consultation with the agricultural commodity industry 
involved, to be appropriate to administer the order. In 
addition to members, the Secretary may also provide for 
alternates on the board. 
(B) APPOINTMENT.—The Secretary shall appoint the 
members and any alternates of a board from among produc-
ers of the agricultural commodity and first handlers and 
others in the marketing chain as appropriate. If imports 
of the agricultural commodity covered by an order are 
subject to assessment under section 516(f), the Secretary 
shall also appoint importers as members of the board and 
as alternates if alternates are included on the board. The 
Secretary may appoint 1 or more members of the general 
public to each board. 
(C) NOMINATIONS.—The Secretary may make appoint-
ments from nominations made pursuant to the method 
set forth in the order. 
(D) GEOGRAPHICAL REPRESENTATION.—To ensure fair 
and equitable representation of the agricultural commodity 
industry covered by an order, the composition of each board 
shall reflect the geographical distribution of the production 
of the agricultural commodity involved in the United States 
and the quantity or value of the agricultural commodity 
imported into the United States. 
(3) REAPPORTIONMENT OF BOARD MEMBERSHIP.—In accord-
ance with rules issued by the Secretary, at least once in each 
5-year period, but not more frequently than once in each 3-
year period, each board shall— 
(A) review the geographical distribution in the United 
States of the production of the agricultural commodity cov-
ered by the order involved and the quantity or value of 
the agricultural commodity imported into the United 
States; and 
(B) if warranted, recommend to the Secretary the 
reapportionment of the board membership to reflect 
changes in the geographical distribution of the production 
of the agricultural commodity and the quantity or value 
of the imported agricultural commodity. 
(4) NOTICE.— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1037 
(A) VACANCIES.—Each order shall provide for notice 
of board vacancies to the agricultural commodity industry 
involved. 
(B) MEETINGS.—Each board shall provide the Secretary 
with prior notice of meetings of the board to permit the 
Secretary, or a designated representative of the Secretary, 
to attend the meetings. 
(5) TERM OF OFFICE.— 
(A) IN GENERAL.—The members and any alternates 
of a board shall each serve for a term of 3 years, except 
that the members and any alternates initially appointed 
to a board shall serve for terms of not more than 2, 3, 
and 4 years, as specified by the order. 
(B) LIMITATION ON CONSECUTIVE TERMS.—A member 
or alternate may serve not more than 2 consecutive terms. 
(C) 
CONTINUATION 
OF 
TERM.—Notwithstanding 
subparagraph (B), each member or alternate shall continue 
to serve until a successor is appointed by the Secretary. 
(D) VACANCIES.—A vacancy arising before the expira-
tion of a term of office of an incumbent member or alternate 
of a board shall be filled in a manner provided for in 
the order. 
(6) COMPENSATION.— 
(A) IN GENERAL.—Members and any alternates of a 
board shall serve without compensation. 
(B) TRAVEL EXPENSES.—If approved by a board, mem-
bers or alternates shall be reimbursed for reasonable travel 
expenses, which may include a per diem allowance or actual 
subsistence incurred while away from their homes or regu-
lar places of business in the performance of services for 
the board. 
(c) POWERS AND DUTIES OF A BOARD.—Each order shall specify 
the powers and duties of the board established under the order, 
which shall include the power and duty— 
(1) to administer the order in accordance with its terms 
and conditions and to collect assessments; 
(2) to develop and recommend to the Secretary for approval 
such bylaws as may be necessary for the functioning of the 
board and such rules as may be necessary to administer the 
order, including activities authorized to be carried out under 
the order; 
(3) to meet, organize, and select from among the members 
of the board a chairperson, other officers, and committees and 
subcommittees, as the board determines to be appropriate; 
(4) to employ persons, other than the members, as the 
board considers necessary to assist the board in carrying out 
its duties, and to determine the compensation and specify the 
duties of the persons; 
(5) subject to subsection (e), to develop and carry out 
generic promotion, research, and information activities relating 
to the agricultural commodity covered by the order; 
(6) to prepare and submit for the approval of the Secretary, 
before the beginning of each fiscal year, rates of assessment 
under section 517 and an annual budget of the anticipated 
expenses to be incurred in the administration of the order, 
including the probable cost of each promotion, research, and 
110 STAT. 1038 
PUBLIC LAW 104-127—APR. 4, 1996 
information activity proposed to be developed or carried out 
by the board; 
(7) to borrow funds necessary for the startup expenses 
of the order; 
(8) subject to subsection (f), to enter into contracts or agree-
ments to develop and carry out generic promotion, research, 
and information activities relating to the agricultural commod-
ity covered by the order; 
(9) to pay the cost of the activities with assessments col-
lected under section 517, earnings from invested assessments, 
and other funds; 
Records. 
(10) to keep records that accurately reflect the actions 
and transactions of the board, to keep and report minutes 
of each meeting of the board to the Secretary, and to furnish 
the Secretary with any information or records the Secretary 
requests; 
(11) to receive, investigate, and report to the Secretary 
complaints of violations of the order; and 
(12) to recommend to the Secretary such amendments to 
the order as the board considers appropriate. 
(d) PROHIBITED ACTIVITIES.—^A board may riot engage in, and 
shall prohibit the employees and agents of the board from engaging 
in— 
(1) any action that would be a conflict of interest; 
(2) using funds collected by the board under the order, 
any action undertaken for the purpose of influencing any legis-
lation or governmental action or policy other than recommend-
ing to the Secretary amendments to the order; and 
(3) any advertising, including promotion, research, and 
information activities authorized to be carried out under the 
order, that may be false or misleading or disparaging to another 
agricultural commodity. 
(e) ACTIVITIES AND BUDGETS.— 
(1) ACTIVITIES.—Each order shall require the board estab-
lished under the order to submit to the Secretary for approval 
plans and projects for promotion, research, or information relat-
ing to the agricultural commodity covered by the order. 
(2) BUDGETS.— 
(A) SUBMISSION TO SECRETARY.—Each order shall 
require the board established under the order to submit 
to the Secretary for approval a budget of its anticipated 
annual expenses and disbursements to be paid to admin-
ister the order. The budget shall be submitted before the 
beginning of a fiscal year and as frequently as may be 
necessary after the beginning of the fiscal year. 
(B) REIMBURSEMENT OF SECRETARY.—Each order shall 
require that the Secretary be reimbursed for all expenses 
incurred by the Secretary in the implementation, adminis-
tration, and supervision of the order, including all referenda 
costs incurred in connection with the order. 
(3) INCURRING EXPENSES.—^A board may incur the expenses 
described in paragraph (2) and other expenses for the adminis-
tration, maintenance, and functioning of the board as author-
ized by the Secretary. 
(4) PAYMENT OF EXPENSES.—Expenses incurred under para-
graph (3) shall be paid by a board using assessments collected 
under section 517, earnings obtained from assessments, and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1039 
other income of the board. Any funds borrowed by the board 
shall be expended only for startup costs and capital outlays. 
(5) LIMITATION ON SPENDING.—For fiscal years beginning 
3 or more years after the date of the establishment of a board, 
the board may not expend for administration (except for 
reimbursements to the Secretary required under paragraph 
(2)(B)), maintenance, and functioning of the board in a fiscal 
year an amount that exceeds 15 percent of the assessment 
and other income received by the board for the fiscal year. 
(f) CONTRACTS AND AGREEMENTS.— 
(1) IN GENERAL.—Each order shall provide that, with the 
approval of the Secretary, the board established under the 
order may— 
(A) enter into contracts and agreements to carry out 
generic promotion, research, and information activities 
relating to the agricultural commodity covered by the order, 
including contracts and agreements with producer associa-
tions or other entities as considered appropriate by the 
Secretary; and 
(B) pay the cost of approved generic promotion, 
research, and information activities using assessments col-
lected under section 517, earnings obtained from assess-
ments, and other income of the board. 
(2) REQUIREMENTS.—Each contract or agreement shall pro-
vide that any person who enters into the contract or agreement 
with the board shall— 
(A) develop and submit to the board a proposed activity 
together with a budget that specifies the cost to be incurred 
to carry out the activity; 
(B) keep accurate records of all of its transactions Records. 
relating to the contract or agreement; 
(C) account for funds received and expended in connec-
tion with the contract or agreement; 
(D) make periodic reports to the board of activities 
conducted under the contract or agreement; and 
(E) make such other reports as the board or the Sec-
retary considers relevant. 
(g) RECORDS OF BOARD.— 
(1) IN GENERAL.—Each order shall require the board estab-
lished under the order— 
(A) to maintain such records as the Secretary may 
require and to make the records available to the Secretary 
for inspection and audit; 
(B) to collect and submit to the Secretary, at any 
time the Secretary may specify, any information the Sec-
retary may request; and 
(C) to account for the receipt and disbursement of 
all funds in the possession, or under the control, of the 
board. 
(2) AUDITS.—Each order shall require the board established 
under the order to have— 
(A) its records audited by an independent auditor at 
the end of each fiscal year; and 
(B) a report of the audit submitted directly to the Reports. 
Secretary. 
(h) PERIODIC EVALUATION.—In accordance with section 501(c), 
each order shall require the board established under the order 
110 STAT. 1040 
PUBLIC LAW 104-127—APR. 4, 1996 
to provide for the independent evaluation of all generic promotion, 
research, and information activities undertaken under the order. 
(i) BOOKS AND RECORDS OF PERSONS COVERED BY ORDER.— 
(1) IN GENERAL.—Each order shall require that producers, 
first handlers and other persons in the marketing chain as 
appropriate, and importers covered by the order shall— 
(A) maintain records sufficient to ensure compliance 
with the order and regulations; 
(B) submit to the board established under the order 
any information required by the board to carry out its 
responsibilities under the order; and 
(C) make the records described in subparagraph (A) 
available, during normal business hours, for inspection by 
employees or agents of the board or the Department, includ-
ing any records necessary to verify information required 
under subparagraph (B). 
(2) TIME REQUIREMENT.—^Any record required to be main-
tained under paragraph (1) shall be maintained for such time 
period as the Secretary may prescribe. 
(3) OTHER INFORMATION.—^The Secretary may use, and may 
authorize the board to use under this subtitle, information 
regarding persons subject to an order that is collected by the 
Department under any other law. 
(4) CONFIDENTIALITY OF INFORMATION.— 
(A) IN GENERAL.—Except as otherwise provided in this 
subtitle, all information obtained under paragraph (1) or 
as part of a referendum under section 518 shall be kept 
confidential by all officers, employees, and agents of the 
Department and of the board. 
(B) DISCLOSURE.—Information referred to in subpara-
graph (A) may be disclosed only if— 
(i) the Secretary considers the information rel-
evant; and 
(ii) the information is revealed in a judicial 
proceeding or administrative hearing brought at the 
direction or on the request of the Secretary or to which 
the Secretary or any officer of the Department is a 
party. 
(C) OTHER EXCEPTIONS.—^This paragraph shall not pro-
hibit— 
(i) the issuance of general statements based on 
reports or on information relating to a number of per-
sons subject to an order if the statements do not iden-
tify the information furnished by any person; or 
(ii) the publication, by direction of the Secretary, 
of the name of any person violating any order and 
a statement of the particular provisions of the order 
violated by the person. 
(D) PENALTY.—^Any person who willfully violates this 
subsection shall be subject, on conviction, to a fine of not 
more than $1,000 or to imprisonment for not more than 
1 year, or both. 
(5) WITHHOLDING INFORMATION.—^This subsection shall not 
authorize the withholding of information from Congress. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1041 
SEC. 516. PERMISSIVE TERMS IN ORDERS. 
7 USC 7415. 
(a) EXEMPTIONS.—^An order issued under this subtitle may con-
tain— 
(1) authority for the Secretary to exempt from the order 
any de minimis quantity of an agricultural commodity otherwise 
covered by the order; and 
(2) authority for the board established under the order 
to require satisfactory safeguards against improper use of the 
exemption. 
(b) DIFFERENT PAYMENT AND REPORTING SCHEDULES.—^An order 
issued under this subtitle may contain authority for the board 
established under the order to designate different payment and 
reporting schedules to recognize differences in agricultural commod-
ity industry marketing practices and procedures used in different 
production and importing areas. 
(c) ACTIVITIES.—^An order issued under this subtitle may contain 
authority to develop and carry out research, promotion, and 
information activities designed to expand, improve, or make more 
efficient the marketing or use of the agricultural commodity covered 
by the order in domestic and foreign markets. Section 515(e) shall 
apply with respect to activities authorized under this subsection. 
(d) RESERVE FUNDS.—^An order issued under this subtitle may 
contain authority to reserve funds from assessments collected under 
section 517 to permit an effective and continuous coordinated pro-
gram of research, promotion, and information in years when the 
yield from assessments may be reduced, except that the amount 
of funds reserved may not exceed the greatest aggregate amount 
of the anticipated disbursements specified in budgets approved 
under section 515(e) by the Secretary for any 2 fiscal years. 
(e) CREDITS.— 
(1) GENERIC ACTIVITIES.—^An order issued under this sub-
title may contain authority to provide credits of assessments 
for those individuals who contribute to other similar generic 
research, promotion, and information programs at the State, 
regional, or local level. 
(2) BRANDED ACTIVITIES.— 
(A) IN GENERAL.—^The Secretary may permit a farmer 
cooperative that engages in branded activities relating to 
the marketing of the products of members of the cooperative 
to receive an annual credit for the activities and related 
expenditures in the form of a deduction of the total cost 
of the activities £ind related expenditures from the amount 
of any assessment that Would otherwise be required to 
be paid by the producer members of the cooperative under 
an order issued under this subtitle. 
(B) ELECTION BY COOPERATIVE.—^A farmer cooperative 
may elect to voluntarily waive the application of subpara-
graph (A) to the cooperative. 
(f) i^SESSMENT OF IMPORTS.—^An order issued under this sub-
title may contain authority for the board established under the 
order to assess under section 517 an imported agricultural commod-
ity, or products of such an agricultural commodity, at a rate com-
parable to the rate determined by the appropriate board for the 
domestic agricultural commodity covered by the order. 
(g) OTHER AUTHORITY.—^An order issued under this subtitle 
may contain authority to take any other action that— 
110 STAT. 1042 
PUBLIC LAW 104-127—APR. 4, 1996 
(1) is not inconsistent with the purpose of this subtitle, 
any term or condition specified in section 515, or any rule 
issued to carry out this subtitle; and 
(2) is necessary to administer the order. 
7 use 7416. 
SEC. 517. ASSESSMENTS. 
(a) ASSESSMENTS AUTHORIZED.—While an order issued under 
this subtitle is in effect with respect to an agricultural commodity, 
assessments shall be— 
(1) paid by first handlers with respect to the agricultural 
commodity produced and marketed in the United States; and 
(2) paid by importers with respect to the agricultural 
commodity imported into the United States, if the imported 
agricultural commodity is covered by the order pursuant to 
section 516(f). 
(b) COLLECTION.—^Assessments required under an order shall 
be remitted to the board established under the order at the time 
and in the manner prescribed by the order. 
(c) LIMITATION ON ASSESSMENTS.—Not more than 1 assessment 
may be levied on a first handler or importer under subsection 
(a) with respect to any agricultural commodity. 
(d) ASSESSMENT RATES.—^The board shall recommend to the 
Secretary 1 or more rates of assessment to be levied under sub-
section (a). If approved by the Secretary, the rates shall take effect. 
An order may provide that an assessment rate may not be increased 
unless approved by a referendum conducted pursuant to section 
518. 
(e) LATE-PAYMENT AND INTEREST CHARGES.— 
(1) IN GENERAL.—Late-payment and interest charges may 
be levied on each person subject to an order who fails to 
remit an assessment in accordance with subsection (b). 
(2) RATE.—^The rate for the charges shall be specified by 
the Secretary. 
(f) INVESTMENT OF ASSESSMENTS.—Pending disbursement of 
assessments under a budget approved by the Secretary, a board 
may invest assessments collected under this section in— 
(1) obligations of the United States or any agency of the 
United States; 
(2) general obligations of any State or any political subdivi-
sion of a State; 
(3) interest-bearing accounts or certificates of deposit of 
financial institutions that are members of the Federal Reserve 
System; or 
(4) obligations fully guaranteed as to principal and interest 
by the United States. 
(g) REFUND OF ASSESSMENTS FROM ESCROW ACCOUNT.— 
(1) ESCROW ACCOUNT.—During the period beginning on 
the effective date of an order and ending on the date the 
Secretary announces the results of a referendum that is con-
ducted under section 518(b)(1) with respect to the order, the 
board established under the order shall— 
(A) establish and maintain an escrow account of the 
kind described in subsection (f)(3) to be used to refund 
assessments; and 
(B) deposit funds in the account in accordance with 
paragraph (2). 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1043 
(2) AMOUNT TO BE DEPOSITED.—^The board shall deposit 
in the account an amount equal to 10 percent of the assess-
ments collected during the period referred to in paragraph 
(1). 
(3) RIGHT TO RECEIVE REFUND.—Subject to paragraphs (4), 
(5), and (6), persons subject to an order shall be eligible to 
demand a refund of assessments collected during the period 
referred to in paragraph (1) if— 
(A) the assessments were remitted on behalf of the 
person; and 
(B) the order is not approved in the referendum. 
(4) FORM OF DEMAND.—^The demand for a refund shall 
be made at such time and in such form as specified by the 
order. 
(5) PAYMENT OF REFUND.—^A person entitled to a refund 
shall be paid promptly after the board receives satisfactory 
proof that the assessment for which the refund is demanded 
was paid on behalf of the person who makes the demand. 
(6) PRORATION.—If the funds in the escrow account required 
by paragraph (1) are insufficient to pay the amount of all 
refunds that persons subject to an order otherwise would have 
a right to receive under this subsection, the board shall prorate 
the amount of the funds among all the persons. 
(7) CLOSING OF ESCROW ACCOUNT.—If the order is approved 
in a referendum conducted under section 518(b)(1)— 
(A) the escrow account shall be closed; and 
(B) the funds shall be available to the board for 
disbursement as authorized in the order. 
SEC. 518. REFERENDA. 
7 USC 7417. 
(a) INITIAL REFERENDUM.— 
(1) 
OPTIONAL 
REFERENDUM.—For 
the 
purpose 
of 
ascertaining whether the persons to be covered by an order 
favor the order going into effect, the order may provide for 
the Secretary to conduct an initial referendum among persons 
to be subject to an assessment undier section 517 who, during 
a representative period determined by the Secretary, engaged 
in— 
(A) the production or handling of the agricultural 
commodity covered by the order; or 
(B) the importation of the agricultural commodity. 
(2) PROCEDURE.—The results of the referendum shall be 
determined in accordance with subsection (e). The Secretary 
may require that the agricultural commodity industry involved 
post a bond or other collateral to cover the cost of the referen-
dum. 
(b) REQUIRED REFERENDA.— 
(1) IN GENERAL.—For the purpose of ascertaining whether 
the persons covered by an order favor the continuation, suspen-
sion, or termination of the order, the Secretary shall conduct 
a referendum among persons subject to assessments under 
section 517 who, during a representative period determined 
by the Secretary, have engaged in— 
(A) the production or handling of the agricultural 
commodity covered by the order; or 
(B) the importation of the agricultural commodity. 
110 STAT. 1044 
PUBLIC LAW 104-127—APR. 4, 1996 
(2) TIME FOR REFERENDUM.—The referendum shall be con-
ducted not later than 3 years after assessments first begin 
under the order. 
(3) EXCEPTION.—^This subsection shall not apply if an initial 
referendum was conducted under subsection (a). 
(c) SUBSEQUENT REFERENDA.—^The Secretary shall conduct a 
subsequent referendum— 
(1) not later than 7 years after assessments first begin 
under the order; 
(2) at the request of the board established under the order; 
or 
(3) at the request of 10 percent or more of the number 
of persons eligible to vote under subsection (b)(1); 
to determine if the persons favor the continuation, suspension, 
or termination of the order. 
(d) OTHER REFERENDA.—^The Secretary may conduct a referen-
dum at any time to determine whether the continuation, suspension, 
or termination of the order or a provision of the order is favored 
by persons eligible to vote under subsection (b)(1). 
(e) APPROVAL OF ORDER.—^An order may provide for its approval 
in a referendum— 
(1) by a majority of those persons voting; 
(2) by persons voting for approval who represent a majority 
of the volume of the agricultural commodity; or 
(3) by a majority of those persons voting for approval 
who also represent a majority of the volume of the agricultural 
commodity. 
(f) COSTS OF REFERENDA.—^The board established under an 
order with respect to which a referendum is conducted under this 
section shall reimburse the Secretary for any expenses incurred 
by the Secretary to conduct the referendum. 
(g) MANNER OF CONDUCTING REFERENDA.— 
(1) IN GENERAL.—^A referendum conducted under this sec-
tion shall be conducted in the manner determined by the Sec-
retary to be appropriate. 
(2) ADVANCE REGISTRATION.—If the Secretary determines 
that an advance registration of eligible voters in a referendum 
is necessary before the voting period in order to facilitate the 
conduct of the referendum, the Secretary may institute the 
advance registration procedures by mail, or in person through 
the use of national and local offices of the Department. 
(3) VOTING.—Eligible voters may vote by mail ballot in 
the referendum or in person if so prescribed by the Secretary. 
(4) NOTICE.—Not later than 30 days before a referendum 
is conducted under this section with respect to an order, the 
Secretary shall notify the agricultural commodity industry 
involved, in such manner as determined by the Secretary, of 
the period during which voting in the referendum will occur. 
The notice shall explain any registration and voting procedures 
established under this subsection. 
7 use 7418. 
SEC. 519. PETITION AND REVIEW OF ORDERS. 
(a) PETITION.— 
(1) IN GENERAL,—A person subject to an order issued under 
this subtitle may file with the Secretary a petition— 
PUBLIC LiVW 104-127—APR. 4, 1996 
110 STAT. 1045 
(A) stating that the order, any provision of the order, 
or any obhgation imposed in connection with the order, 
is not estabHshed in accordance with law; and 
(B) requesting a modification of the order or an exemp-
tion from the order. 
(2) HEARING.—The Secretary shall give the petitioner an 
opportunity for a hearing on the petition, in accordance with 
regulations issued by the Secretary. 
(3) RULING.—^After the hearing, the Secretary shall make 
a ruling on the petition. The ruling shall be final, subject 
to review as set forth in subsection (b). 
(4) LIMITATION ON PETITION.—^Any petition filed under this 
subsection challenging an order, any provision of the order, 
or any obligation imposed in connection with the order, shall 
be filed within 2 years after the effective date of the order, 
provision, or obligation subject to challenge in the petition. 
(b) REVIEW.— 
(1) COMMENCEMENT OF ACTION.—The district court of the 
United States for any district in which a person who is a 
petitioner under subsection (a) resides or carries on business 
shall have jurisdiction to review the final ruling on the petition 
of the person, if a complaint for that purpose is filed not 
later than 20 days after the date of the entry of the final 
ruling by the Secretary under subsection (a)(3). 
(2) PROCESS.—Service of process in a proceeding may be 
made on the Secretary by delivering a copy of the complaint 
to the Secretary. 
(3) REMANDS.—If the court determines that the ruling is 
not in accordance with law, the court shall remand the matter 
to the Secretary with directions— 
(A) to make such ruling as the court determines to 
be in accordance with law; or 
(B) to take such further action as, in the opinion of 
the court, the law requires. 
(c) EFFECT ON ENFORCEMENT PROCEEDINGS.—The pendency of 
a petition filed under subsection (a) or an action commenced under 
subsection (b) shall not operate as a stay of any action authorized 
by section 520 to be taken to enforce this subtitle, including any 
rule, order, or penalty in effect under this subtitle. 
SEC. 520. ENFORCEMENT. 
(a) JURISDICTION.—^The district courts of the United States 
shall have jurisdiction specifically to enforce, and to prevent and 
restrain a person from violating, an order or regulation issued 
under this subtitle. 
(b) REFERRAL TO ATTORNEY GENERAL.—^A civil action authorized 
to be brought under this section shall be referred to the Attorney 
General for appropriate action, except that the Secretary shall 
not be required to refer to the Attorney General a violation of 
this subtitle if the Secretary believes that the administration and 
enforcement of this subtitle would be adequately served by providing 
a suitable written notice or warning to the person who committed 
the violation or by an administrative action under this section. 
(c) CIVIL PENALTIES I\ND ORDERS.— 
(1) CIVIL PENALTIES.—^A person who willfully violates an 
order or regulation issued by the Secretary under this Act 
Courts. 
7 use 7419. 
Courts. 
110 STAT. 1046 
PUBLIC LAW 104-127—APR. 4, 1996 
may be assessed by the Secretary a civil penalty of not less 
than $1,000 and not more than $10,000 for each violation. 
(2) SEPARATE OFFENSE.—Each violation and each day dur-
ing which there is a failure to comply with an order or regula-
tion issued by the Secretary shall be considered to be a separate 
offense. 
(3) CEASE-AND-DESIST ORDERS.—In addition to, or in lieu 
of, a civil penalty, the Secretary may issue an order requiring 
a person to cease and desist from violating the order or regula-
tion. 
(4) NOTICE AND HEARING.—No order assessing a penalty 
or cease-and-desist order may be issued by the Secretary under 
this subsection unless the Secretary provides notice and an 
opportunity for a hearing on the record with respect to the 
violation. 
(5) FINALITY.—^An order assessing a penalty or a cease-
and-desist order issued under this subsection by the Secretary 
shall be final and conclusive unless the person against whom 
the order is issued files an appeal from the order with the 
United States court of appeals, as provided in subsection (d). 
(d) REVIEW BY COURT OF APPEALS.— 
(1) IN GENERAL.—^A person against whom an order is issued 
under subsection (c) may obtain review of the order by— 
(A) filing, not later than 30 days after the person 
receives notice of the order, a notice of appeal in— 
(i) the United States court of appeals for the circuit 
in which the person resides or carries on business; 
or 
(ii) the United States Court of Appeals for the 
District of Columbia Circuit; and 
(B) simultaneously sending a copy of the notice of 
appeal by certified mail to the Secretary. 
(2) RECORD.—^The Secretary shall file with the court a 
certified copy of the record on which the Secretary has deter-
mined that the person has committed a violation. 
(3) STANDARD OF REVIEW.—^A finding of the Secretary under 
this section shall be set aside only if the finding is found 
to be unsupported by substantial evidence on the record. 
(e) FAILURE TO OBEY CEASE-AND-DESIST ORDERS.—A person 
who fails to obey a valid cease-£ind-desist order issued by the 
Secretary under this section, after an opportunity for a hearing, 
dhall be subject to a civil penalty assessed by the Secretary of 
liot less than $1,000 and not more than $10,000 for each offense. 
Each day during which the failure continues shall be considered 
to be a separate violation of the cease-and-desist order. 
(f) FAILURE TO PAY PENALTIES.—If a person fails to pay a 
civil penalty imposed under this section by the Secretary, the Sec-
retary sh£dl refer the matter to the Attorney General for recovery 
of the amount assessed in the district court of the United States 
for any district in which the person resides or carries on business. 
In the action, the validity and appropriateness of the order imposing 
the civil penalty shall not be subject to review. 
(g) ADDITIONAL REMEDIES.—^The remedies provided in this sec-
tion shall be in addition to, and not exclusive of, other remedies 
that may be available. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1047 
SEC. 521. INVESTIGATIONS AND POWER TO SUBPOENA. 
7 USC 7420. 
(a) INVESTIGATIONS.—The Secretary may make such investiga-
tions as the Secretary considers necessary— 
(1) for the effective administration of this subtitle; or 
(2) to determine whether any person subject to this subtitle 
has engaged, or is about to engage, in any action that con-
stitutes or will constitute a violation of this subtitle or any 
order or regulation issued under this subtitle. 
(b) SUBPOENAS, OATHS, AND AFFIRMATIONS.—For the purpose 
of any investigation under subsection (a), the Secretary may admin-
ister oaths and affirmations, subpoena witnesses, compel the attend-
ance of witnesses, take evidence, and require the production of 
any records or documents that are relevant to the inquiry. The 
attendance of witnesses and the production of records or documents 
may be required from any place in the United States. 
(c) AID OF COURTS.—In the case of contumacy by, or refusal 
to obey a subpoena issued to, any person, the Secretary may invoke 
the aid of any court of the United States within the jurisdiction 
of which the investigation or proceeding is carried on, or where 
the person resides or carries on business, in order to require the 
attendance and testimonj^ of the person or the production of records 
or documents. The court may issue an order requiring the person 
to appear before the Secretary to produce records or documents 
or to give testimony regarding the matter under investigation. 
(d) CONTEMPT.—^Any failure to obey the order of the court 
may be punished by the court as a contempt of the court. 
(e) PROCESS.—Process in any case under this section may be 
served in the judicial district in which the person resides or carries 
on business or wherever the person may be found. 
SEC. 522. S U S P E N S I O N OR TERMINATION. 
7 USC 7421. 
(a) MANDATORY SUSPENSION OR TERMINATION.—^The Secretary 
shall suspend or terminate an order or a provision of an order 
if the Secretary finds that an order or a provision of an order 
obstructs or does not tend to effectuate the purpose of this subtitle, 
or if the Secretary determines that the order or a provision of 
an order is not favored by persons voting in a referendum conducted 
under section 518. 
(b) IMPLEMENTATION OF SUSPENSION OR TERMINATION.—If, as 
a result of a referendum conducted under section 518, the Secretary 
determines that an order is not approved, the Secretary shall— 
(1) not later than 180 days after making the determination, 
suspend or terminate, as the case may be, collection of assess-
ments under the order; and 
(2) as soon as practicable, suspend or terminate, as the 
case may be, activities under the order in an orderly manner. 
SEC. 523. AMENDMENTS TO ORDERS. 
7 USC 7422. 
The provisions of this subtitle applicable to an order shall 
be applicable to any amendment to an order, except that section 
518 shall not apply to an amendment. 
SEC. 524. EFFECT ON OTHi]R LAWS. 
7 USC 7423. 
This subtitle shall not affect or preempt any other Federal 
or State law authorizing promotion or research relating to an agri-
cultural commodity. 
110 STAT. 1048 
PUBLIC LAW 104-127—APR. 4, 1996 
7 use 7424. 
SEC. 525- REGULATIONS. 
The Secretary may issue such regulations as may be necessary 
to carry out this subtitle and the power vested in the Secretary 
under this subtitle. 
7 use 7425. 
SEC. 526. AUTHORIZATION OF APPROPRIATIONS. 
(a) IN GENERAL.—There are authorized to be appropriated such 
sums as may be necessary to carry out this subtitle. 
(b) 
LIMITATION 
ON 
EXPENDITURES 
FOR 
ADMINISTRATIVE 
EXPENSES.—Funds appropriated to carry out this subtitle may not 
be expended for the payment of expenses incurred by a board 
to administer an order. 
candaand 
Subtitle C—Canola and Rapeseed 
Rapeseed 
Promotion, and 
SEC. 531. SHORT TITLE. 
Information Act 
'^^^^ subtitle may be cited as the "Canola and Rapeseed 
7 use 7401 note. Research, Promotion, and Consumer Information Act". 
7 use 7441. 
SEC. 532. FINDINGS AND DECLARATION OF POLICY. 
(a) FINDINGS.—Congress finds that— 
(1) canola and rapeseed products are an important and 
nutritious part of the human diet; 
(2) the production of canola and rapeseed products plays 
a significant role in the economy of the United States in that— 
(A) canola and rapeseed products are produced by thou-
sands of canola and rapeseed producers and processed by 
numerous processing entities; and 
(B) canola and rapeseed products produced in the 
United States are consumed by people throughout the 
United States and foreign countries; 
(3) canola, rapeseed, and canola and rapeseed products 
should be readily available and marketed efficiently to ensure 
that consumers have an adequate supply of canola and rapeseed 
products at a reasonable price; 
(4) the maintenance and expansion of existing markets 
and development of new markets for canola, rapeseed, and 
canola and rapeseed products are vital to the welfare of canola 
and rapeseed producers and processors and those persons con-
cerned with marketing canola, rapeseed, and canola and 
rapeseed products, as well as to the general economy of the 
United States, and are necessary to ensure the ready availabil-
ity and efficient marketing of canola, rapeseed, and canola 
and rapeseed products; 
(5) there exist established State and national organizations 
conducting canola and rapeseed research, promotion, and 
consumer education programs that are valuable to the efforts 
of promoting the consumption of canola, rapeseed, and canola 
and rapeseed products; 
(6) 
the 
cooperative 
development, 
financing, 
and 
implementation of a coordinated national program of canola 
and rapeseed research, promotion, consumer information, and 
industry information is necessary to maintain and expand exist-
ing markets and develop new markets for canola, rapeseed, 
and canola and rapeseed products; and 
(7) canola, rapeseed, and canola and rapeseed products 
move in interstate and foreign commerce, and canola, rapeseed, 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1049 
and canola and rapeseed products that do not move in interstate 
or foreign commerce directly burden or affect interstate com-
merce in canola, rapeseed, and canola and rapeseed products. 
(b) POLICY.—It is the policy of this subtitle to establish an 
orderly procedure for developing, financing through assessments 
on domestically produced canola and rapeseed, and implementing 
a program of research, promotion, consumer information, and indus-
try information designed to strengthen the position in the market-
place of the canola and rapeseed industry, to maintain and expand 
existing domestic and foreign markets and uses for canola, rapeseed, 
and canola and rapeseed products, and to develop new markets 
and uses for canola, rapeseed, and canola and rapeseed products. 
(c) CONSTRUCTION.—Nothing in this subtitle provides for the 
control of production or otherwise limits the right of individual 
producers to produce canola, rapeseed, or canola or rapeseed prod-
ucts. 
SEC. 533. DEFINITIONS. 
7 USC 7442. 
In this subtitle (unless the context otherwise requires): 
(1) BOARD.—The term "Board" means the National Canola 
and Rapeseed Board established under section 535(b). 
(2) CANOLA; RAPESEED.—^The terms "canola" and "rapeseed" 
mean any brassica plant grown in the United States for the 
production of an oilseed, the oil of which is used for a food 
or nonfood use. 
(3) CANOLA OR RAPESEED PRODUCT.—The term "canola or 
rapeseed product" means a product produced, in whole or in 
part, from canola or rapeseed. 
(4) COMMERCE.—^The term "commerce" includes interstate, 
foreign, and intrastate commerce. 
(5) CONFLICT OF INTEREST.—^The term "conflict of interest" 
means a situation in which a member of the Board has a 
direct or indirect financial interest in a corporation, partner-
ship, sole proprietorship, joint venture, or other business entity 
dealing directly or indirectly with the Board. 
(6) 
CONSUMER 
INFORMATION.—The 
term 
"consumer 
information" means information that will assist consumers and 
other persons in making evaluations and decisions regarding 
the purchase, prep^iration, and use of canola, rapeseed, or 
canola or rapeseed products. 
(7) DEPARTMENT.—The term "Department" means the 
Department of Agriculture. 
(8) FIRST PURCH^^ER.—The term "first purchaser" means— 
(A) except as provided in subparagraph (B), a person 
who buys or otherwise acquires canola, rapeseed, or canola 
or rapeseed products produced by a producer; or 
(B) the Commodity Credit Corporation, in a case in 
which canola or rapeseed is forfeited to the Commodity 
Credit Corporation as collateral for a loan issued under 
a price support loan program administered by the Commod-
ity Credit Corporation. 
(9) INDUSTRY INFORMATION.—The term "industry informa-
tion" means information or a program that will lead to the 
development of new markets, new marketing strategies, or 
increased efficiency for the canola and rapeseed industry, or 
an activity to enhance the image of the canola or rapeseed 
industry. 
110 STAT. 1050 
PUBLIC LAW 104-127—APR. 4, 1996 
(10) INDUSTRY MEMBER.—The term "industry member" 
means a member of the canola and rapeseed industry who 
represents— 
(A) manufacturers of canola or rapeseed products; or 
(B) persons who commercially buy or sell canola or 
rapeseed. 
(11) MARKETING.—^The term "marketing" means the sale 
or other disposition of canola, rapeseed, or canola or rapeseed 
products in a channel of commerce. 
(12) ORDER.—^The term "order" means an order issued 
under section 534. 
(13) PERSON.—The term "person" means an individual, 
partnership, corporation, association, cooperative, or any other 
legal entity. 
(14) PRODUCER.—^The term "producer" means a person 
engaged in the growing of canola or rapeseed in the tJnited 
States who owns, or who shares the ownership and risk of 
loss of, the canola or rapeseed. 
(15) PROMOTION.—^The term "promotion" means an action, 
including paid advertising, technical assistance, or a trade serv-
icing activity, to enhance the image or desirability of canola, 
rapeseed, or canola or rapeseed products in domestic and for-
eign markets, or an activity designed to communicate to 
consumers, processors, wholesalers, retailers, government offi-
cials, or other persons information relating to the positive 
attributes of canola, rapeseed, or canola or rapeseed products 
or the benefits of use or distribution of canola, rapeseed, or 
canola or rapeseed products. 
(16) RESEARCH.—^The term "research" means any type of 
test, study, or analysis to advance the image, desirability, 
marketability, production, product development, quality, or 
functional or nutritional value of canola, rapeseed, or canola 
or rapeseed products, including research activity designed to 
identify and analyze barriers to export sales of canola or 
rapeseed produced in the United States. 
(17) SECRETARY.—^The term "Secretary" means the Sec-
retary of Agriculture. 
(18) STATE.—The term "State" means any of the 50 States, 
the District of Columbia and the Commonwealth of Puerto 
Rico. 
(19) UNITED STATES.—^The term "United States" means 
collectively the 50 States, the District of Columbia, and the 
Commonwealth of Puerto Rico. 
7 use 7443. 
SEC. 534. ISSUANCE AND AMENDMENT OF ORDERS. 
(a) IN GENERAL.—Subject to subsection (b), the Secretary shall 
issue 1 or more orders under this subtitle applicable to producers 
and first purchasers of canola, rapeseed, or canola or rapeseed 
products. The order shall be national in scope. Not more than 
1 order shall be in effect under this subtitle at any 1 time. 
(b) PROCEDURE.— 
(1) PROPOSAL OR REQUEST FOR ISSUANCE.—^The Secretary 
may propose the issuance of an order under this subtitle, or 
an association of canola and rapeseed producers or any other 
person that would be affected by an order issued pursuant 
to this subtitle may request the issuance of, and submit a 
proposal for, an order. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1051 
(2) NOTICE AND COMMENT CONCERNING PROPOSED ORDER.— 
Not later than 60 days after the receipt of a request and 
proposal for an order pursuant to paragraph (1), or whenever 
the Secretary determines to propose an order, the Secretary 
shall publish a proposed order and give due notice and oppor-
tunity for public comment on the proposed order. 
(3) ISSUANCE OF ORDER.—^After notice and opportunity for 
public comment are given as provided in paragraph (2), the 
Secretary shall issue an order, taking into consideration the 
comments received and including in the order provisions nec-
essary to ensure that the order is in conformity with the 
requirements of this subtitle. The order shall be issued and 
become effective not later than 180 days following publication 
of the proposed order. 
(c) AMENDMENTS.—^The Secretary may amend an order issued 
under this section. 
SEC. 535. REQUIRED TERMS IN ORDERS. 
(a) IN GENERAL.—^An order issued under this subtitle shall 
contain the terms and conditions specified in this section. 
(b) ESTABLISHMENT AND MEMBERSHIP OF THE NATIONAL CANOLA 
AND RAPESEED BOARD.— 
(1) IN GENERAL.—The order shall provide for the establish-
ment of, and appointment of members to, a National Canola 
and Rapeseed Board to administer the order. 
(2) SERVICE TO ENTIRE INDUSTRY.—^The Board shall carry 
out programs and projects that will provide maximum benefit 
to the canola and rapeseed industry in all parts of the United 
States and only promote canola, rapeseed, or canola or rapeseed 
products. 
(3) BOARD MEMBERSHIP.—The Board shall consist of 15 
members, including— 
(A) 11 members who are producers, including— 
(i) 1 member from each of the 6 geographic regions 
comprised of States where canola or rapeseed is pro-
duced, as determined by the Secretary; and 
(ii) 5 members from the geographic regions 
referred to in clause (i), allocated according to the 
production in each region; and 
(B) 4 members who are industry members, including 
at least— 
(i) 1 member who represents manufacturers of 
canola or rapeseed end products; and 
(ii) 1 member who represents persons who commer-
cially buy or sell canola or rapeseed. 
(4) LIMITATION ON STATE RESIDENCE.—There shall be no 
more than 4 producer members of the Board from any 1 State. 
(5) MODIFYING BOARD MEMBERSHIP.—In accordance with 
regulations approved by the Secretary, at least once each 3 
years and not more than once each 2 years, the Board shall 
review the geographic distribution of canola and rapeseed 
production throughout the United States and, if warranted, 
recommend to the Secretary that the Secretary— 
(A) reapportion 
regions in order to reflect the 
geographic distribution of canola and rapeseed production; 
and 
Publication. 
Effective date. 
7 use 7444. 
110 STAT. 1052 
PUBLIC LAW 104-127—APR. 4, 1996 
(B) reapportion the seats on the Board to reflect the 
production in each region. 
(6) CERTIFICATION OF ORGANIZATIONS.— 
(A) IN GENERAL.—For the purposes of section 536, the 
eHgibiHty of any State organization to represent producers 
shall be certified by the Secretary. 
(B) CRITERIA.—The Secretary shall certify any State 
organization that the Secretary determines has a history 
of stability and permanency and meets at least 1 of the 
following criteria: 
(i) MAJORITY REPRESENTATION.—^The total paid 
membership of the organization— 
(I) is comprised of at least a majority of canola 
or rapeseed producers; or 
(II) represents at least a majority of the canola 
or rapeseed producers in the State. 
(ii) 
SUBSTANTIAL NUMBER OF PRODUCERS 
REP-
RESENTED.—The organization represents a substantial 
number of producers that produce a substantial quan-
tity of canola or rapeseed in the State. 
(iii) PURPOSE.—^The organization is a general farm 
or agricultural organization that has as a stated objec-
tive the promotion and development of the United 
States canola or rapeseed industry and the economic 
welfare of United States canola or rapeseed producers. 
(C) REPORT.—The Secretary shall make a certification 
under this paragraph on the basis of a factual report 
submitted by the State organization. 
(7) TERMS OF OFFICE.— 
(A) IN GENERAL.—^A member of the Board shall serve 
for a term of 3 years, except that the members appointed 
to the initial Board shall serve, proportionately, for terms 
of 1, 2, and 3 years, as determined by the Secretary. 
(B) LIMITATION ON TERMS.—No individual may serve 
more than 2 consecutive 3-year terms as a member. 
(C) 
TERMINATION 
OF 
TERMS.—^Notwithstanding 
subparagraph (B), each member shall continue to serve 
until a successor is appointed by the Secretary. 
(8) COMPENSATION.—^A member of the Board shall serve 
without compensation, but shall be reimbursed for necessary 
and reasonable expenses incurred in the performance of duties 
for and approved by the Board. 
(c) POWERS AND DUTIES OF THE BOARD.—^The order shall define 
the powers and duties of the Board, which shall include the power 
and duty— 
(1) to administer the order in accordance with the terms 
and conditions of the order; 
(2) to issue regulations to effectuate the terms and condi-
tions of the order; 
(3) to meet, organize, and select from among members 
of the Board a chairperson, other officers, and committees and 
subcommittees, as the Board determines appropriate; 
(4) to establish working committees of persons other than 
Board members; 
(5) to employ such persons, other than Board members, 
as the Board considers necessary, and to determine the com-
pensation and define the duties of the persons; 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1053 
(6) to prepare and submit for the approval of the Secretary, 
when appropriate or necessary, a recommended rate of assess-
ment under section 536, and a fiscal period budget of the 
anticipated expenses in the administration of the order, includ-
ing the probable costs of all programs and projects; 
(7) to develop programs and projects, subject to subsection 
(d); 
(8) to enter into contracts or agreements, subject to sub-
section (e), to develop and carry out programs or projects of 
research, promotion, industry information, 
and 
consumer 
information; 
(9) to carry out research, promotion, industry information, 
and consumer information projects, and to pay the costs of 
the projects with assessments collected under section 536; 
(10) to keep minutes, books, and records that reflect the 
actions and transactions of the Board, and promptly report 
minutes of each Board meeting to the Secretary; 
(11) to appoint and convene, from time to time, working 
committees comprised of producers, industry members, and 
the public to assist in the development of research, promotion, 
industry information, and consumer information programs for 
canola, rapeseed, and canola and rapeseed products; 
(12) to invest, pending disbursement under a program or 
project, funds collected through assessments authorized under 
section 536, or funds earned from investments, only in— 
(A) obligations of the United States or an agency of 
the United States; 
(B) general obligations of a State or a political subdivi-
sion of a State; 
(C) an interest-bearing account or certificate of deposit 
of a bank that is a member of the Federal Reserve System; 
or 
(D) obligations fully guaranteed as to principal and 
interest by the United States; 
(13) to receive, investigate, and report to the Secretary 
complaints of violations of the order; 
(14) to furnish the Secretary with such information as 
the Secretary may request; 
(15) to recommend to the Secretary amendments to the 
order; 
(16) to develop and recommend to the Secretary for 
approval such regulations as may be necessary for the develop-
ment and execution of programs or projects, or as may otherwise 
be necessary, to carry out the order; and 
(17) to provide the Secretary with advance notice of meet-
ings. 
(d) PROGRAMS AND BUDGETS.— 
(1) SUBMISSION TO SECRETARY.—^The order shall provide 
that the Board shall submit to the Secretary for approval 
any program or project of research, promotion, consumer 
information, or industry information. No program or project 
shall be implemented prior to approval by the Secretary. 
(2) BUDGETS.—The order shall require the Board, prior 
to the beginning of each fiscal year, or as may be necessary 
after the beginning of a fiscal year, to submit to the Secretary 
for approval budgets of anticipated expenses and disbursements 
in the implementation of the order, including projected costs 
110 STAT. 1054 
PUBLIC LAW 104-127—APR. 4, 1996 
Effective date. 
Records. 
Reports. 
Reports. 
Reports. 
of research, promotion, consumer information, and industry 
information programs and projects. 
(3) INCURRING EXPENSES.—The Board may incur such 
expenses for programs or projects of research, promotion, 
consumer information, or industry information, and other 
expenses for the administration, maintenance, and functioning 
of the Board as may be authorized by the Secretary, including 
any implementation, administrative, and referendum costs 
incurred by the Department. 
(4) PAYING EXPENSES.—^The funds to cover the expenses 
referred to in paragraph (3) shall be paid by the Board from 
assessments collected under section 536 or funds borrowed 
pursuant to paragraph (5). 
(5) AUTHORITY TO BORROW.—^To meet the expenses referred 
to in paragraph (3), the Board shall have the authority to 
borrow funds, as approved by the Secretary, for capital outlays 
and startup costs. 
(e) CONTRACTS AND AGREEMENTS.— 
(1) IN GENERAL.—To ensure efficient use of funds, the order 
shall provide that the Board may enter into a contract or 
agreement for the implementation and carrying out of a pro-
gram or project of canola, rapeseed, or canola or rapeseed 
products research, promotion, consumer information, or indus-
try information, including a contract with a producer organiza-
tion, and for the payment of the costs with funds received 
by the Board under the order. 
(2) REQUIREMENTS.—A contract or agreement under para-
graph (1) shall provide that— 
(A) the contracting party shall develop and submit 
to the Board a program or project together with a budget 
that shall show the estimated costs to be incurred for 
the program or project; 
(B) the program or project shall become effective on 
the approval of the Secretary; and 
(C) the contracting party shall keep accurate records 
of all transactions, account for funds 
received 
and 
expended, make periodic reports to the Board of activities 
conducted, and make such other reports as the Board or 
the Secretary may require. 
(3) PRODUCER ORGANIZATIONS.—The order shall provide 
that the Board may contract with a producer organization 
for any services required in addition to the services described 
in paragraph (1). The contract shall include provisions com-
parable to the provisions required by paragraph (2). 
(f) BOOKS AND RECORDS OF THE BOARD.— 
(1) IN GENERAL.—^The order shall require the Board to— 
(A) maintain such books and records (which shall be 
available to the Secretary for inspection and audit) as 
the Secretary may prescribe; 
(B) prepare and submit to the Secretary, from time 
to time, such reports as the Secretary may prescribe; and 
(C) account for the receipt and disbursement of all 
funds entrusted to the Board. 
(2) AUDITS.—The Board shall cause the books and records 
of the Board to be audited by an independent auditor at the 
end of each fiscal year, and a report of the audit to be submitted 
to the Secretary. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1055 
(g) PROHIBITION.— 
(1) IN GENERAL.—Subject to paragraph (2), the Board shall 
not engage in any action to, nor shall any funds received 
by the Board under this subtitle be used to— 
(A) influence legislation or governmental action; 
(B) engage in an action that would be a conflict of 
interest; 
(C) engage in advertising that is false or misleading; 
or 
(D) engage in promotion that would disparage other 
commodities. 
(2) ACTION PERMITTED.—Paragraph (1) does not preclude— 
(A) the development and recommendation of amend-
ments to the order; 
(B) the communication to appropriate government offi-
cials of information relating to the conduct, implementa-
tion, or results of promotion, research, consumer informa-
tion, or industry information activities under the order; 
or 
(C) any action designed to market canola or rapeseed 
products directly to a foreign government or political sub-
division of a foreign government. 
(h) BOOKS AND RECORDS.— 
(1) IN GENERAL.—The order shall require that each pro-
ducer, first purchaser, or industry member shall— 
(A) maintain and submit to the Board any reports 
considered necessary by the Secretary to ensure compliance 
with this subtitle; and 
(B) make available during normal business hours, for 
inspection by employees of the Board or Secretary, such 
books and records as are necessary to carry out this sub-
title, including such records as are necessary to verify 
any required reports. 
(2) CONFIDENTIALITY.— 
(A) IN GENERAL.—Except as otherwise provided in this 
subtitle, all information obtained from books, records, or 
reports required to be maintained under paragraph (1) 
shall be kept confidential, and shall not be disclosed to 
the public by any person. 
(B) DISCLOSURE.—Information referred to in subpara-
graph (A) may be disclosed to the public i
f
— 
(i) the Secretary considers the information rel-
evant; 
(ii) the information is revealed in a suit or adminis-
trative hearing brought at the direction or on the 
request of the Secretary or to which the Secretary 
or any officer of the Department is a party; and 
(iii) the information relates to this subtitle. 
(C) MiscONDirCT.—A knowing disclosure of confidential 
information in violation of subparagraph (A) by an officer 
or employee of the Board or Department, except as required 
by other law or allowed under subparagraph (B) or (D), 
shall be considered a violation of this subtitle. 
(D) GENERAL STATEMENTS.—^Nothing in this paragraph 
prohibits— 
(i) the issuance of general statements based on 
the reports of a number of persons subject to an order 
110 STAT. 1056 
PUBLIC LAW 104-127—APR. 4, 1996 
or statistical data collected from the reports, if the 
statements do not identify the information furnished 
by any person; or 
(ii) the publication, by direction of the Secretary, 
of the name of a person violating the order, together 
with a statement of the particular provisions of the 
order violated by the person. 
(3) AVAILABILITY OF INFORMATION FOR LAW ENFORCE-
MENT.—Information obtained under this subtitle may be made 
available to another agency of the Federal Government for 
a civil or criminal law enforcement activity if the activity is 
authorized by law and if the head of the agency has made 
a written request to the Secretary specifying the particular 
information desired and the law enforcement activity for which 
the information is sought. 
(4) PENALTY.—^Any person knowingly violating this sub-
section, on conviction, shall be subject to a fine of not more 
than $1,000 or to imprisonment for not more than 1 year, 
or both, and if an officer or employee of the Board or the 
Department, shall be removed from office or terminated from 
employment, as applicable. 
(5) WITHHOLDING OF INFORMATION.—Nothing in this sub-
title authorizes the withholding of information from Congress, 
(i) USE OF ASSESSMENTS.—The order shall provide that the 
assessments collected under section 536 shall be used for payment 
of the expenses in implementing and administering this subtitle, 
with provision for a reasonable reserve, and to cover administrative 
costs incurred by the Secretary in implementing and administering 
this subtitle. 
(j) OTHER TERMS AND CONDITIONS.—The order shall contain 
such other terms and conditions, not inconsistent with this subtitle, 
as are determined necessary by the Secretary to effectuate this 
subtitle. 
7 use 7445. 
SEC. 536. ASSESSMENTS. 
(a) IN GENERAL.— 
(1) FIRST PURCHASERS.—During the effective period of an 
order issued pursuant to this subtitle, assessments shall be— 
(A) levied on all canola or rapeseed produced in the 
United States and marketed; and 
(B) deducted from the payment made to a producer 
for all canola or rapeseed sold to a first purchaser. 
(2) DIRECT PROCESSING.—The order shall provide that any 
person processing canola or rapeseed of that person's own 
production and marketing the canola or rapeseed, or canola 
or rapeseed products, shall remit to the Board or a State 
organization certified to represent producers under section 
535(b)(6), in the manner prescribed by the order, an assessment 
established at a rate equivalent to the rate provided for under 
subsection (d). 
(b) LIMITATION ON ASSESSMENTS.—No more than 1 assessment 
may be assessed under subsection (a) on any canola or rapeseed 
produced (as remitted by a first purchaser). 
(c) REMITTING OF ASSESSMENTS.— 
(1) IN GENERAL.—^Assessments required under subsection 
(a) shall be remitted to the Board by a first purchaser. The 
Board shall use State organizations certified to represent 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1057 
producers under section 535(b)(6) to collect the assessments. 
If an appropriate certified State organization does not exist 
to collect an assessment, the assessment shall be collected 
by the Board. There shall be only 1 certified State organization 
in each State. 
(2) TIMES TO REMIT ASSESSMENT.—Each first purchaser 
shall remit the assessment to the Board as provided for in 
the order. 
(d) ASSESSMENT RATE.— 
(1) INITIAL RATE.—The initial assessment rate shall be 
4 cents per hundredweight of canola or rapeseed produced 
and marketed. 
(2) INCREASE.—^The assessment rate may be increased on 
recommendation by the Board to a rate not exceeding 10 cents 
per hundredweight of canola or rapeseed produced and mar-
keted in a State, unless— 
(A) after the initial referendum is held under section 
537(a), the Board recommends an increase above 10 cents 
per hundredweight; and 
(B) the increase is approved in a referendum under 
section 537(b). 
(3) CREDIT.—^A producer who demonstrates to the Board 
that the producer is participating in a program of a State 
organization certified to represent producers under section 
535(b)(6) shall receive credit, in determining the assessment 
due from the producer, for contributions to the program of 
up to 2 cents per hundredweight of canola or rapeseed mar-
keted. 
(e) LATE PAYMENT CHARGE.— 
(1) IN GENERAL.—There shall be a late payment charge 
imposed on any person who fails to remit, on or before the 
date provided for in the order, to the Board the total amount 
for which the person is liable. 
(2) AMOUNT OF CHARGE.—^The amount of the late payment 
charge imposed under paragraph (1) shall be prescribed by 
the Board with the approval of the Secretary. 
(f) REFUND OF ASSESSMENTS FROM ESCROW ACCOUNT.— 
(1) ESTABLISHMENT OF ESCROW ACCOUNT.—During the 
period beginning on the date on which an order is first issued 
under section 534(b)(3) and ending on the date on which a 
referendum is conducted under section 537(a), the Board shall— 
(A) establish and maintain an escrow account to be 
used for assessment refunds; and 
(B) place funds in the account in accordance with para-
graph (2). 
(2) PLACEMENT OF FUNDS IN ACCOUNT.—The Board shall 
place in the account, from assessments collected during the 
period referred to in paragraph (1), an amount equal to the 
product obtained by multiplying the total amount of assess-
ments collected during the period by 10 percent. 
(3) RIGHT TO RECEIVE REFUND.—The Board shall refund 
to a producer the assessments paid by or on behalf of the 
producer if— 
(A) the producer is required to pay the assessment; 
(B) the producer does not support the program estab-
lished under this subtitle; and 
110 STAT. 1058 
PUBLIC LAW 104-127—APR. 4, 1996 
(C) the producer demands the refund prior to the con-
duct of the referendum under section 537(a). 
(4) FORM OF DEMAND.—^The demand shall be made in 
accordance with such regulations, in such form, and within 
such time period as prescribed by the Board. 
(5) MAKING OF REFUND.—^The refund shall be made on 
submission of proof satisfactory to the Board that the producer 
paid the assessment for which the refund is demanded. 
(6) PRORATION.—If— 
(A) the amount in the escrow account required by 
paragraph (1) is not sufficient to refund the total amount 
of assessments demanded by eligible producers; and 
(B) the order is not approved pursuant to the referen-
dum conducted under section 537(a); 
the Board shall prorate the amount of the refunds among 
all eligible producers who demand a refund. 
(7) PROGRAM APPROVED.—If the plan is approved pursuant 
to the referendum conducted under section 537(a), all funds 
in the escrow account shall be returned to the Board for use 
by the Board in accordance with this subtitle. 
7 use 7446. 
SEC. 537. REFERENDA. 
(a) INITIAL REFERENDUM.— 
(1) REQUIREMENT.—During the period ending 30 months 
after the date on v/hich an order is first issued under section 
534(b)(3), the Secretary shall conduct a referendum among 
producers who, during a representative period as determined 
by the Secretary, have been engaged in the production of canola 
or rapeseed for the purpose of ascertaining whether the order 
then in effect shall be continued. 
(2) ADVANCE NOTICE.—The Secretary shall, to the extent 
practicable, provide broad public notice in advance of any ref-
erendum. The notice shall be provided, without advertising 
expenses, by means of newspapers, county newsletters, the 
electronic media, and press releases, through the use of notices 
posted in State and county Cooperative State Research, Edu-
cation, and Extension Service offices and county Consolidated 
Farm Service Agency offices, and by other appropriate means 
specified in the order. The notice shall contain information 
on when the referendum will be held, registration and voting 
requirements, rules regarding absentee voting, and other perti-
nent information. 
(3) APPROVAL OF ORDER.—^The order shall be continued 
only if the Secretary determines that the order has been 
approved by not less than a majority of the producers voting 
in the referendum. 
Termination 
(4) DISAPPROVAL OF ORDER.—If continuation of the order 
date. 
is not approved by a majority of the producers voting in the 
referendum, the Secretary shall terminate collection of assess-
ments under the order within 180 days after the referendum 
and shall terminate the order in an orderly manner as soon 
as practicable. 
(b) ADDITIONAL REFERENDA.— 
(1) IN GENERAL.— 
(A) REQUIREMENT.—^After the initial referendum on an 
order, the Secretary shall conduct additional referenda, 
as described in subparagraph (C), if requested by a rep-
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1059 
resentative group of producers, as described in subpara-
graph (B). 
(B) REPRESENTATIVE GROUP OF PRODUCERS.—An addi-
tional referendum on an order shall be conducted if 
requested by 10 percent or more of the producers who, 
during a representative period as determined by the Sec-
retary, have been engaged in the production of canola 
or rapeseed. 
(C) ELIGIBLE PRODUCERS.—Each additional referendum 
shall be conducted among all producers who, during a 
representative period as determined by the Secretary, have 
been engaged in the production of canola or rapeseed to 
determine whether the producers favor the termination 
or suspension of the order. 
(2) DISAPPROVAL OF ORDER.—If the Secretary determines, 
in a referendum conducted under paragraph (1), that suspen-
sion or termination of the order is favored by a majority of 
the producers voting in the referendum, the Secretary shall 
suspend or terminate, as appropriate, collection of assessments 
under the order within 180 days after the determination, and 
shall suspend or terminate the order, as appropriate, in an 
orderly manner as soon as practicable after the determination. 
(3) OPPORTUNITY TO REQUEST ADDITIONAL REFERENDA.— 
(A) IN GENERAL.—Beginning on the date that is 5 years 
after the conduct of a referendum under this subtitle, and 
every 5 years thereafter, the Secretary shall provide canola 
and rapeseed producers an opportunity to request an addi-
tional referendumi. 
(B) METHOD OF MAKING REQUEST.— 
(i) IN-PERSON REQUESTS.—^To carry out subpara-
graph (A), the Secretary shall establish a procedure 
under which a producer may make a request for a 
reconfirmation referendum in person at a county 
Cooperative State Research, Education, and Extension 
Service office or a county Consolidated Farm Service 
Agency office during a period established by the Sec-
retary, or as provided in clause (ii). 
(ii) MAIL-IN REQUESTS.—In lieu of making a 
request in person, a producer may make a request 
by mail. To facilitate the submission of requests by 
mail, the Secretary may make mail-in request forms 
available to producers. 
(C) NOTIFICATIONS.—The Secretary shall publish a 
notice in the Federal Register, and the Board shall provide 
written notification to producers, not later than 60 days 
prior to the end of the period established under subpara-
graph (B)(i) for an in-person request, of the opportunity 
of producers to request an additional referendum. The 
notification shall explain the right of producers to an addi-
tional referendum, the procedure for a referendum, the 
purpose of a referendum, and the date and method by 
which producers may act to request an additional referen-
dum under this paragraph. The Secretary shall take such 
other action as the Secretary determines is necessary to 
ensure that producers are made aware of the opportunity 
to request an additional referendum. 
Termination 
date. 
Federal Register, 
publication. 
110 STAT. 1060 
PUBLIC LAW 104-127—APR. 4, 1996 
(D) ACTION BY SECRETARY.—^As soon as practicable fol-
lowing the submission of a request for an additional ref-
erendum, the Secretary shall determine whether a suffi-
cient number of producers have requested the referendum, 
and take such steps as are necessary to conduct the referen-
dum, as required under paragraph (1). 
(E) TIME LIMIT.—^An additional referendum requested 
under the procedures provided in this paragraph shall be 
conducted not later than 1 year after the Secretary deter-
mines that a representative group of producers, as 
described in paragraph (1)(B), have requested the conduct 
of the referendum. 
(
c
) 
PROCEDURES.— 
(1) REIMBURSEMENT OF SECRETARY.—The Secretary shall 
be reimbursed from assessments collected by the Board for 
any expenses incurred by the Secretary in connection with 
the conduct of an activity required under this section. 
(2) DATE.—Each referendum shall be conducted for a 
reasonable period of time not to exceed 3 days, established 
by the Secretary, under a procedure under which producers 
intending to vote in the referendum shall certify that the 
producers were engaged in the production of canola, rapeseed, 
or canola or rapeseed products during the representative period 
and, at the same time, shall be provided an opportunity to 
vote in the referendum. 
(3) PLACE.—Referenda under this section shall be conducted 
at locations determined by the Secretary. On request, absentee 
mail ballots shall be furnished by the Secretary in a manner 
prescribed by the Secretary. 
7 use 7447. 
SEC. 538. PETITION AND REVIEW. 
(a) PETITION.— 
(1) IN GENERAL.—^A person subject to an order issued under 
this subtitle may file with the Secretary a petition— 
(A) stating that the order, a provision of the order, 
or an obligation imposed in connection with the order is 
not established in accordance with law; and 
(B) requesting a modification of the order or gm exemp-
tion from the order. 
(2) HEARINGS.—The petitioner shall be given the oppor-
tunity for a hearing on a petition filed under paragraph (1), 
in accordance with regulations issued by the Secretary. 
(3) RULING.—^After a hearing under paragraph (2), the Sec-
retary shall issue a ruling on the petition that is the subject 
of the hearing, which shall be final if the ruling is in accordance 
with applicable law. 
(4) LIMITATION ON PETITION.—^Any petition filed under this 
subtitle challenging an order, or any obligation imposed in 
connection with an order, shall be filed not later than 2 years 
after the effective date of the order or imposition of the obliga-
tion. 
(b) REVIEW.— 
Courts. 
(1) COMMENCEMENT OF ACTION.—^The district court of the 
United States for any district in which the person who is 
a petitioner under subsection (a) resides or carries on business 
shall have jurisdiction to review a ruling on the petition, if 
a complaint is filed by the person not later than 20 days 
PUBLIC ]JiW 104-127—APR. 4, 1996 
110 STAT. 1061 
after the date of the entry of a ruHng by the Secretary under 
subsection (a)(3). 
(2) PROCESS.—Service of process in a proceeding under 
paragraph (1) shall be conducted in accordance with the Federal 
Rules of Civil Procedure. 
(3) REMANDS.—If the court determines, under paragraph 
(1), that a ruling issued under subsection (a)(3) is not in accord-
ance with applicable law, the court shall remand the matter 
to the Secretary with directions either— 
(A) to make such ruling as the court shall determine 
to be in accordance with law; or 
(B) to take such further proceedings as, in the opinion 
of the court, the law requires. 
(4) ENFORCEMENT.—The pendency of proceedings instituted 
under subsection (a) shall not impede, hinder, or delay the 
Attorney General or the Secretary from taking any action under 
section 539. 
SEC. 539. ENFORCEMENT. 
Courts. 
7 use 7448 
(a) JURISDICTION.—The district courts of the United States 
are vested with jurisdiction specifically to enforce, and to prevent 
and restrain any person from violating, an order or regulation 
made or issued under this subtitle. 
(b) REFERRAL TO ATI^ORNEY GENERAL.—^A civil action-authorized 
to be commenced under this section shall be referred to the Attorney 
General for appropriate action, except that the Secretary shall 
not be required to refer to the Attorney General a violation of 
this subtitle if the Secretary believes that the administration and 
enforcement of this subtitle would be adequately served by providing 
a suitable written notice or warning to the person committing 
the violation or by administrative action under subsection (c). 
(c) CIVIL PENALTIES .\ND ORDERS.— 
(1) CIVIL PENALTIES.— 
(A) IN GENERAL.—^Any person who willfully violates 
any provision of an order or regulation issued by the Sec-
retary under this subtitle, or who fails or refuses to pay, 
collect, or remit an assessment or fee required of the person 
under an order or regulation, may be assessed— 
(i) a civil penalty by the Secretary of not more 
than $1,000 for each violation; and 
(ii) in the case of a willful failure to pay, collect, 
or remit an assessment as required by an order or 
regulation, an additional penalty equal to the amount 
of the assessment. 
(B) 
SEPARATE 
OFFENSE.—^Each 
violation 
under 
subparagraph (A) shall be a separate offense. 
(2) CEASE-AND-DESIST ORDERS.—In addition to, or in lieu 
of, a civil penalty under paragraph (1), the Secretary may 
issue an order requiring a person to cease and desist from 
continuing a violation. 
(3) NOTICE AND HEARING.—No penalty shall be assessed, 
or cease-and-desist order issued, by the Secretary under this 
subsection unless the person against whom the penalty is 
assessed or the cease-and-desist order is issued is given notice 
and opportunity for a. hearing before the Secretary with respect 
to the violation. 
110 STAT. 1062 
PUBLIC LAW 104-127—APR. 4, 1996 
(4) FINALITY.—^The order of the Secretary assessing a pen-
alty or imposing a cease-and-desist order under this subsection 
shall be final and conclusive unless the affected person files 
an appeal of the order in the appropriate district court of 
the United States in accordance with subsection (d). 
(d) REVIEW BY DISTRICT COURT.— 
(1) COMMENCEMENT OF ACTION.—^Any person who has been 
determined to be in violation of this subtitle, or against whom 
a civil penalty has been assessed or a cease-and-desist order 
issued under subsection (c), may obtain review of the penalty 
or cease-and-desist order by— 
(A) filing, within the 30-day period beginning on the 
date the penalty is assessed or cease-and-desist order 
issued, a notice of appeal in— 
(i) the district court of the United States for the 
district in which the person resides or carries on busi-
ness; or 
(ii) the United States District Court for the District 
of Columbia; and 
(B) simultaneously sending a copy of the notice by 
certified mail to the Secretary. 
(2) RECORD.—The Secretary shall file promptly, in the 
appropriate court referred to in paragraph (1), a certified copy 
of the record on which the Secretary determined that the person 
committed the violation. 
(3) STANDARD OF REVIEW.—^A finding of the Secretary under 
this section shall be set aside only if the finding is found 
to be unsupported by substantial evidence. 
(e) FAILURE TO OBEY CEASE-AND-DESIST ORDERS.—^Any person 
who fails to obey a cease-and-desist order issued under this section 
after the cease-and-desist order has become final and unappealable, 
or after the appropriate United States district court has entered 
a final judgment in favor of the Secretary, shall be subject to 
a civil penalty assessed by the Secretary, after opportunity for 
a hearing and for judicial review under the procedures specified 
in subsections (c) and (d), of not more than $5,000 for each offense. 
Each day during which the failure continues shall be considered 
as a separate violation of the cease-and-desist order. 
(f) FAILURE TO PAY PENALTIES.—If a person fails to pay an 
assessment of a civil penalty under this section after the assessment 
has become a final and unappealable order, or after the appropriate 
United States district court has entered final judgment in favor 
of the Secretary, the Secretary shall refer the matter to the Attorney 
General for recovery of the amount assessed in the district court 
of the United States for any district in which the person resides 
or carries on business. In an action for recovery, the validity and 
appropriateness of the final order imposing the civil penalty shall 
not be subject to review. 
(g) ADDITIONAL REMEDIES.—^The remedies provided in this sub-
title shall be in addition to, and not exclusive of, other remedies 
that may be available. 
7 use 7449. 
SEC. 540. INVESTIGATIONS AND POWER TO SUBPOENA. 
(a) INVESTIGATIONS.—The Secretary may make such investiga-
tions as the Secretary considers necessary— 
(1) for the effective administration of this subtitle; and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1063 
(2) to determine whether any person has engaged or is 
engaging in an act that constitutes a violation of this subtitle, 
or an order, rule, or regulation issued under this subtitle. 
(b) SUBPOENAS, OATHS, AND AFFIRMATIONS.— 
(1) IN GENERAL.—For the purpose of an investigation under 
subsection (a), the Secretary may administer oaths and affirma-
tions, subpoena witnesses, take evidence, and issue subpoenas 
to require the production of any records that are relevant 
to the inquiry. The attendance of witnesses and the production 
of records may be required from any place in the United States. 
(2) ADMINISTRATIVE HEARINGS.—For the purpose of 
an 
administrative hearing held under section 538 or 539, the 
presiding officer is authorized to administer oaths and affirma-
tions, subpoena and compel the attendance of witnesses, take 
evidence, and require the production of any records that are 
relevant to the inquiry. The attendance of witnesses and the 
production of records may be required from any place in the 
United States. 
(c) AID OF COURTS.—In the case of contumacy by, or refusal 
to obey a subpoena issued to, any person, the Secretary may invoke 
the aid of any court of the United States within the jurisdiction 
of which the investigation or proceeding is carried on, or where 
the person resides or carries on business, in order to enforce a 
subpoena issued by the Secretary under subsection (b). The court 
may issue an order requiring the person to comply with the sub-
poena. 
(d) CONTEMPT.—^A failure to obey an order of the court under 
this section may be punished by the court as contempt of the 
court. 
(e) PROCESS.—Process may be served on a person in the judicial 
district in which the person resides or carries on business or wher-
ever the person may be found. 
(f) HEARING SITE.—^^rhe site of a hearing held under section 
538 or 539 shall be in the judicial district where the person affected 
by the hearing resides or has a principal place of business. 
SEC. 541. SUSPENSION OR TERMINATION. 
7 USC 7450. 
The Secretary shall, whenever the Secretary finds that an 
order or a provision of an order obstructs or does not tend to 
effectuate the declared policy of this subtitle, suspend or terminate 
the operation of the order or provision. The suspension or termi-
nation of an order shall not be considered an order within the 
meaning of this subtitle. 
SEC. 542. REGULATIONS. 
7 USC 7451. 
The Secretary may issue such regulations as are necessary 
to carry out this subtitle. 
SEC. 543. AUTHORIZATION OF APPROPRIATIONS. 
7 USC 7452. 
(a) IN GENERAL.—There are authorized to be appropriated for 
each fiscal year such sums as are necessary to carry out this 
subtitle. 
(b) ADMINISTRATIVE EXPENSES.—Funds appropriated under sub-
section (a) shall not be available for payment of the expenses 
or expenditures of the Board in administering a provision of an 
order issued under this subtitle. 
110 STAT. 1064 
PUBLIC LAW 104-127—APR, 4, 1996 
National 
Subtltlc D—^Kiwifruit 
Kiwifruit 
Research, 
Promotion, and 
SEC. 551. SHORT TITLE. 
Informatbn Act. 
^his Subtitle may be cited as the "National Kiwifruit Research, 
7 use 7401 note. Promotion, and Consumer Information Act". 
7 use 7461. 
SEC. 552. FINDINGS AND PURPOSES. 
(a) FINDINGS.—Congress finds that— 
(1) domestically produced kiwifruit are grown by many 
individual producers; 
(2) virtually all domestically produced kiwifruit are grown 
in the State of California, although there is potential for produc-
tion in many other areas of the United States; 
(3) kiwifruit move in interstate and foreign commerce, and 
kiwifruit that do not move in channels of commerce directly 
burden or affect interstate commerce; 
(4) in recent years, large quantities of kiwifruit have been 
imported into the United States; 
(5) the maintenance and expansion of existing domestic 
and foreign markets for kiwifruit, and the development of addi-
tional and improved markets for kiwifruit, are vital to the 
welfare of kiwifruit producers and other persons concerned 
with producing, marketing, and processing kiwifruit; 
(6) a coordinated program of research, promotion, and 
consumer information regarding kiwifruit is necessary for the 
maintenance and development of the markets; and 
(7) kiwifruit producers, handlers, and importers are unable 
to implement and finance such a program without cooperative 
action. 
(b) PURPOSES.—^The purposes of this subtitle are— 
(1) to authorize the establishment of an orderly procedure 
for the development and financing (through an assessment) 
of an effective and coordinated program of research, promotion, 
and consumer information regarding kiwifruit; 
(2) to use the program to strengthen the position of the 
kiwifruit industry in domestic and foreign markets and main-
tain, develop, and expand markets for kiwifruit; and 
(3) to treat domestically produced kiwifruit and imported 
kiwifruit equitably. 
7 use 7462. 
SEC. 553. DEFINITIONS. 
In this subtitle (unless the context otherwise requires): 
(1) BOARD.—^The term 
"Board" means the 
National 
Kiwifruit Board established under section 555. 
(2) 
CONSUMER 
INFORMATION.—^The 
term 
"consumer 
information" means any action taken to provide information 
to, and broaden the understanding of, the general public regard-
ing the consumption, use, nutritional attributes, and care of 
kiwifruit. 
(3) EXPORTER.—^The term "exporter" means any person 
from outside the United States who exports kiwifruit into the 
United States. 
(4) HANDLER.—^The term "handler" means any person, 
excluding a common carrier, engaged in the business of buying 
and selling, packing, marketing, or distributing kiwifruit as 
specified in the order. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1065 
(5) IMPORTER.—^The term "importer" means any person who 
imports kiwifruit into the United States. 
(6) KIWIFRUIT.—The term "kiwifruit" means all varieties 
of fresh kiwifruit grown in or imported into the United States. 
(7) MARKETING.—The term "marketing" means the sale 
or other disposition of kiwifruit into interstate, foreign, or intra-
state commerce by buying, marketing, distribution, or othenvise 
placing kiwifruit into commerce. 
(8) ORDER.—The term "order" means a kiwifruit research, 
promotion, and consumer information order issued by the Sec-
retary under section 554. 
(9) PERSON.—The term "person" means any individual, 
group of individuals, partnership, corporation, association, 
cooperative, or other legal entity. 
(10) PROCESSING.—The term "processing" means canning, 
fermenting, distilling, extracting, preserving, grinding, crush-
ing, or in any manner changing the form of kiwifruit for the 
purpose of preparing the kiwifruit for market or marketing 
the kiwifruit. 
(11) PRODUCER.—^The term "producer" means any person 
who grows kiwifruit in the United States for sale in commerce. 
(12) PROMOTION.—The term "promotion" means any action 
taken under this subtitle (including paid advertising) to present 
a favorable image of kiwifruit to the general public for the 
purpose of improving the competitive position of kiwifruit and 
stimulating the sale of kiwifruit. 
(13) RESEARCH.—^The term "research" means any type of 
research relating to the use, nutritional value, and marketing 
of kiwifruit conducted for the purpose of advancing the image, 
desirability, marketability, or quality of kiwifruit. 
(14) SECRETARY.—^The term "Secretary" means the Sec-
retary of Agriculture. 
(15) UNITED STATES.—The term "United States" means the 
50 States of the United States, the District of Columbia, and 
the Commonwealth of Puerto Rico, 
SEC. 554. ISSUANCE OF ORDERS. 
7 USC 7463. 
(a) ISSUANCE.—^To effiectuate the purposes of this subtitle speci-
fied in section 552(b), the Secretary shall issue an order applicable 
to producers, handlers, and importers of kiwifruit. Any such order 
shall be national in scope. Not more than 1 order shall be in 
effect under this subtitle at any 1 time. 
(b) PROCEDURE.— 
(1) PROPOSAL FOR ISSUANCE OF ORDER.—Any person that 
will be affected by this subtitle may request the issuance of, 
and submit a proposal for, an order under this subtitle. 
(2) PROPOSED ORDER.—^Not later than 90 days after the Publication, 
receipt of a request ;Eind proposal for an order, the Secretary 
shall publish a proposed order and give due notice and oppor-
tunity for public comment on the proposed order. 
(3) ISSUANCE OF ORDER.—After notice and opportunity for 
public comment are provided under paragraph (2), the Secretary 
shall issue an order, taking into consideration the comments 
received and including in the order provisions necessary to 
ensure that the order is in conformity with this subtitle. 
29-194 O - 96 - 35 : QL 3 Part 1 
110 STAT. 1066 
PUBLIC LAW 104-127—APR. 4, 1996 
(c) AMENDMENTS.—^The Secretary may amend any order issued 
under this section. The provisions of this subtitle applicable to 
an order shall be applicable to an amendment to an order. 
7 use 7464. 
SEC. 555. NATIONAL KIWIFRUIT BOARD. 
(a) MEMBERSHIP.—^An order issued by the Secretary under sec-
tion 554 shall provide for the establishment of a National Kiwifruit 
Board that consists of the following 11 members: 
(1) 6 members who are producers (or representatives of 
producers) and who are not exempt from an assessment under 
section 556(b). 
(2) 4 members who are importers (or representatives of 
importers) and who are not exempt from an assessment under 
section 556(b) or are exporters (or representatives of exporters). 
(3) 1 member appointed from the general public. 
(b) ADJUSTMENT OF MEMBERSHIP.— 
(1) IN GENERAL.—Subject to the 11-member limit and to 
paragraph (2), the Secretary may adjust membership on the 
Board to accommodate changes in production and import levels 
of kiwifruit. 
(2) NUMBER OF PRODUCER MEMBERS.—Producers shall com-
prise not less than 51 percent of the membership of the Board. 
(c) APPOINTMENT AND NOMINATION.— 
(1) APPOINTMENT.—^The Secretary shall appoint the mem-
bers of the Board from nominations submitted in accordance 
with this subsection. 
(2) PRODUCERS.—The members referred to in subsection 
(a)(1) shall be appointed from individuals nominated by produc-
ers. 
(3) IMPORTERS AND EXPORTERS.—^The members referred to 
in subsection (a)(2) shall be appointed from individuals nomi-
nated by importers or exporters. 
(4) PUBLIC REPRESENTATIVE.—The public representative 
shall be appointed from nominations submitted by other mem-
bers of the Board. 
(5) FAILURE TO NOMINATE.—If producers, importers, and 
exporters fail to nominate individuals for appointment, the 
Secretary may appoint members and alternates on a basis 
provided for in the order. If the Board fails to nominate a 
public representative, the member may be appointed by the 
Secretary without a nomination. 
(d) ALTERNATES.—The Secretary shall appoint an alternate for 
each member of the Board. An alternate shall— 
(1) be appointed in the same manner as the member for 
whom the individual is an alternate; and 
(2) serve on the Board if the member is absent from a 
meeting or is disqualified under subsection (f). 
(e) TERMS.—^A member of the Board shall be appointed for 
a term of 3 years. No member may serve more than 2 consecutive 
3-year terms, except that of the members first appointed— 
(1) 5 members shall be appointed for a term of 2 years; 
and 
(2) 6 members shall be appointed for a term of 3 years. 
(f) DISQUALIFICATION.—If a member or alternate of the Board 
who was appointed as a producer, importer, exporter, or public 
representative member ceases to belong to the group for which 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1067 
the member was appointed, the member or alternate shall be dis-
qualified from serving on the Board. 
(g) COMPENSATION.—^A member or alternate of the Board shall 
serve without pay. 
(h) GENERAL POWERS AND DUTIES.—The Board shall— 
(1) administer an order issued by the Secretary under 
section 554, and an amendment to the order, in accordance 
with the order and amendment and this subtitle; 
(2) prescribe rules and regulations to carry out the order; Regulations. 
(3) meet, organize, and select from among members of 
the Board a chairperson, other officers, and committees and 
subcommittees, as the Board determines appropriate; 
(4) receive, investigate, and report to the Secretary accounts 
of violations of the order; 
(5) make recommendations to the Secretary with respect 
to an amendment that should be made to the order; and 
(6) employ or contract with a manager and staff to assist 
in administering the order, except that, to reduce administra-
tive costs and increase efficiency, the Board shall seek, to 
the extent practicable, to employ or contract with personnel 
who are already associated with organizations involved in 
promoting kiwifruit that are chartered by a State, the District 
of Columbia, or the Commonwealth of Puerto Rico. 
SEC. 556. REQUIRED TERMS IN ORDER. 
7 USC 7465. 
(a) BUDGETS AND PLANS.— 
(1) IN GENERAL.—^An order issued under section 554 shall 
provide for periodic budgets and plans in accordance with this 
subsection. 
(2) BUDGETS.—^The Board shall prepare and submit to the 
Secretary a budget prior to the beginning of the fiscal year 
of the anticipated expenses and disbursements of the Board 
in the administration of the order, including probable costs 
of research, promotion, and consumer information. A budget 
shall become effective on a %-vote of a quorum of the Board 
and approval by the Secretary. 
(3) PLANS.—Each budget shall include a plan for research, 
promotion, and consumer information regarding kiwifruit. A 
plan under this paragraph shall become effective on approval 
by the Secretary. The Board may enter into contracts and 
agreements, on approval by the Secretary, for— 
(A) the development and carrying out of the plan; 
and 
(B) the payment of the cost of the plan, with funds 
collected pursuant to this subtitle. 
(b) ASSESSMENTS.— 
(1) IN GENERAL.—^The order shall provide for the imposition 
and collection of assessments with regard to the production 
and importation of kiwifruit in accordance with this subsection. 
(2) RATE.—The assessment rate shall be the rate that 
is recommended by a %-vote of a quorum of the Board and 
approved by the Secretary, except that the rate shall not exceed 
$0.10 per 7-pound tray of kiwifruit or an equivalent rate. 
(3) COLLECTION IBY FIRST HANDLERS.—Except as provided 
in paragraph (5), the first handler of kiwifruit shall— 
110 STAT. 1068 
PUBLIC LAW 104-127—APR. 4, 1996 
(A) be responsible for the collection from the producer, 
and payment to the Board, of assessments required under 
this subsection; and 
(B) maintain a separate record of the kiwifruit of each 
producer whose kiwifruit are so handled, including the 
kiwifruit owned by the handler. 
^ 
(4) IMPORTERS.—^The assessment on imported kiwifruit 
shall be paid by the importer to the United States Customs 
Service at the time of entry into the United States and shall 
be remitted to the Board. 
(5) EXEMPTION FROM ASSESSMENT.—^The following persons 
or activities are exempt from an assessment under this sub-
section: 
(A) A producer who produces less than 500 pounds 
of kiwifruit per year. 
(B) An importer who imports less than 10,000 pounds 
of kiwifruit per year. 
(C) A sale of kiwifruit made directly from the producer 
to a consumer for a purpose other than resale. 
(D) The production or importation of kiwifruit for 
processing. 
(6) CLAIM OF EXEMPTION.—^To claim an exemption under 
paragraph (5) for a particular year, a person shall— 
(A) submit an application to the Board stating the 
basis for the exemption and certifying that the quantity 
of kiwifruit produced, imported, or sold by the person will 
not exceed any poundage limitation required for the exemp-
tion in the year; or 
(B) be on a list of approved processors developed by 
the Board. 
(c) USE OF ASSESSMENTS.— 
(1) AUTHORIZED USES.—^The order shall provide that funds 
paid to the Board as assessments under subsection (b) may 
be used by the Board— 
(A) to pay for research, promotion, and consumer 
information described in the budget of the Board under 
subsection (a) and for other expenses incurred by the Board 
in the administration of an order; 
(B) to pay such other expenses for the administration, 
maintenance, and functioning of the Board (including any 
enforcement efforts for the collection of assessments) as 
may be authorized by the Secretary, including interest 
and penalties for late payments; and 
(C) to fund a reserve established under section 557(d). 
(2) REQUIRED USES.—^The order shall provide that funds 
paid to the Board as assessments under subsection (b) shall 
be used by the Board— 
(A) to pay the expenses incurred by the Secretary, 
including salaries and expenses of Federal Government 
employees, in implementing and administering the order; 
and 
(B) to reimburse the Secretary for any expenses 
incurred by the Secretary in conducting referenda under 
this subtitle. 
(3) LIMITATION ON USE OF ASSESSMENTS.—^Except for the 
first year of operation of the Board, expenses for the administra-
PUBLIC I^^W 104-127—APR. 4, 1996 
110 STAT. 1069 
tion, maintenance, and functioning of the Board may not exceed 
30 percent of the budget for a year. 
(d) FALSE CLAIMS.—^The order shall provide that any promotion 
funded with assessments collected under subsection (b) may not 
make— 
(1) any false claims on behalf of kiwifruit; and 
(2) any false statements with respect to the attributes 
or use of any product that competes with kiwifruit for sale 
in commerce. 
(e) PROHIBITION ON USE OF FUNDS.—The order shall provide 
that funds collected by the Board under this subtitle through assess-
ments may not, in any manner, be used for the purpose of influenc-
ing legislation or governmental policy or action, except for making 
recommendations to the Secretary as provided for under this sub-
title. 
if) BOOKS, RECORDS, ^ ^ D REPORTS.— 
I 
(1) BOARD.—The order shall require the Board— 
(A) to maintain books and records with respect to 
the receipt and disbursement of funds received by the 
Board; 
I 
(B) to submit to the Secretary from time to time such 
reports as the Secretary may require for appropriate 
accounting; and 
(C) to submit to the Secretary at the end of each 
fiscal year a complete audit report by an independent audi-
tor regarding the activities of the Board during the fiscal 
year. 
(2) OTHERS.—To make information and data available to 
the Board and the Secretary that is appropriate or necessary 
for the effectuation, administration, or enforcement of this sub-
title (or any order or regulation issued under this subtitle), 
the order shall require handlers and importers who are respon-
sible for the collection, payment, or remittance of assessments 
under subsection (b)— 
(A) to maintain and make available for inspection by 
the employees and agents of the Board and the Secretary 
such books and records as may be required by the order; 
and 
(B) to file, at the times and in the manner and content 
prescribed by the order, reports regarding the collection, 
payment, or remittance of the assessments. 
(g) CONFIDENTIALITY.— 
(1) IN GENERAL.—-The order shall require that all informa-
tion obtained pursuant to subsection (f)(2) be kept confidential 
by all officers, employees, and agents of the Department of 
Agriculture and of the Board. Only such information as the 
Secretary considers relevant shall be disclosed to the public 
and only in a suit or administrative hearing, brought at the 
request of the Secretary or to which the Secretary or any 
officer of the United States is a party, involving the order 
with respect to which the information was furnished or 
acquired. 
(2) LIMITATIONS.—Nothing in this subsection prohibits— 
(A) the issuance of general statements based on the 
reports of a number of handlers and importers subject 
to an order, if the statements do not identify the informa-
tion furnished by any person; or 
110 STAT. 1070 
PUBLIC LAW 104-127—APR. 4, 1996 
(B) the publication, by direction of the Secretary, of 
the name of any person violating an order issued under 
section 554(a), together with a statement of the particular 
provisions of the order violated by the person. 
(3) PENALTY.—^Any person who willfully violates this sub-
section, on conviction, shall be subject to a fine of not more 
than $1,000 or to imprisonment for not more than 1 year, 
or both, and, if the person is a member, officer, or agent 
of the Board or an employee of the Department of Agriculture, 
shall be removed from office. 
(h) WITHHOLDING OF INFORMATION.—Nothing in this subtitle 
authorizes the withholding of information from Congress. 
7 use 7466. 
SEC. 557. PERMISSIVE TERMS IN ORDER. 
(a) PERMISSIVE TERMS.—On the recommendation of the Board 
and with the approval of the Secretary, an order issued under 
section 554 may include the terms and conditions specified in this 
section and such additional terms and conditions as the Secretary 
considers necessary to effectuate the other provisions of the order 
and are incidental to, and not inconsistent with, this subtitle. 
(b) ALTERNATIVE PAYMENT AND REPORTING SCHEDULES.—^The 
order may authorize the Board to designate different handler pay-
ment and reporting schedules to recognize differences in marketing 
practices and procedures. 
(c) WORKING GROUPS.—^The order may authorize the Board 
to convene working groups drawn from producers, handlers, import-
ers, exporters, or the general public and utilize the expertise of 
the groups to assist in the development of research and marketing 
programs for kiwifruit. 
(d) RESERVE FUNDS.—^The order may authorize the Board to 
accumulate reserve funds from assessments collected pursuant to 
section 556(b) to permit an effective and continuous coordinated 
program of research, promotion, and consumer information in years 
in which production and assessment income may be reduced, except 
that any reserve fund may not exceed the amount budgeted for 
operation of this subtitle for 1 year. 
(e) PROMOTION ACTIVITIES OUTSIDE UNITED STATES.—^The order 
may authorize the Board to use, with the approval of the Secretary, 
funds collected under section 556(b) and funds from other sources 
for the development and expansion of sales in foreign markets 
of kiwifruit produced in the United States. 
7 use 7467. 
SEC. 558. PETITION AND REVIEW. 
(a) PETITION.— 
(1) IN GENERAL.—^A person subject to an order may file 
with the Secretary a petition— 
(A) stating that the order, a provision of the order, 
or an obligation imposed in connection with the order is 
not in accordance with law; and 
(B) requesting a modification of the order or an exemp-
tion from the order. 
(2) HEARINGS.—^A person submitting a petition under para-
graph (1) shall be given an opportunity for a hearing on the 
petition, in accordance with regulations issued by the Secretary. 
(3) RULING.—^After the hearing, the Secretary shall issue 
a ruling on the petition which shall be final if the petition 
is in accordance with law. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1071 
(4) LIMITATION ON PETITION.—Any petition filed under this 
subtitle challenging an order, or any obligation imposed in 
connection with an order, shall be filed not later than 2 years 
after the effective date of the order or imposition of the obliga-
tion, 
(b) REVIEW.— 
(1) COMMENCEMENT OF ACTION.—The district court of the 
United States for any district in which the person who is 
a petitioner under subsection (a) resides or carries on business 
is vested with jurisdiction to review the ruling on the petition 
of the person, if a complaint for that purpose is filed not 
later than 20 days after the date of the entry of a ruling 
by the Secretary under subsection (a). 
(2) PROCESS.—Service of process in the proceedings shall 
be conducted in accordance with the Federal Rules of Civil 
Procedure. 
(3) REMANDS.—If the court determines that the ruling is 
not in accordance with law, the court shall remand the matter 
to the Secretary with directions— 
(A) to make such ruling as the court shall determine 
to be in accordance with law; or 
(B) to take such further action as, in the opinion of 
the court, the law requires. 
(4) 
ENFORCEMENT.—The 
pendency 
of a 
proceeding 
instituted pursuant to subsection (a) shall not impede, hinder, 
or delay the Attorney General or the Secretary from obtaining 
relief pursuant to section 559. 
SEC. 
559. 
ENFORCEMENT. 
(a) JURISDICTION.—^A district court of the United States shall 
have jurisdiction specifically to enforce, and to prevent and restrain 
any person from violating, any order or regulation made or issued 
by the Secretary under this subtitle. 
(b) REFERRAL TO ATTORNEY GENERAL.—^A civil action authorized 
to be brought under this section shall be referred to the Attorney 
General for appropriate action, except that the Secretary is not 
required to refer to the Attorney General a violation of this subtitle, 
or any order or regulation issued under this subtitle, if the Secretary 
believes that the administration and enforcement of this subtitle 
would be adequately served by administrative action under sub-
section (c) or suitable written notice or warning to the person 
committing the violation. 
(c) CIVIL PENALTIES AND ORDERS.— 
(1) CIVIL PENALTIES.—^Any person who willfully violates 
any provision of any order or regulation issued by the Secretary 
under this subtitle, or who fails or refuses to pay, collect, 
or remit any assessment or fee duly required of the person 
under the order or regulation, may be assessed a civil penalty 
by the Secretary of not less than $500 nor more than $5,000 
for each such violation. Each violation shall be a separate 
offense. 
(2) CEASE-AND-DESIST ORDERS.—In addition to or in lieu 
of the civil penalty, the Secretary may issue an order requiring 
the person to cease and desist from continuing the violation. 
(3) NOTICE AND HEARING.—^No order assessing a civil pen-
alty or cease-and-desist order may be issued by the Secretary 
under this subsection unless the Secretary gives the person 
Courts. 
Courts. 
7 use 7468. 
110 STAT. 1072 
PUBLIC LAW 104-127—APR. 4, 1996 
against whom the order is issued notice and opportunity for 
a hearing on the record before the Secretary with respect to 
the violation. 
(4) FINALITY.—^The order of the Secretary assessing a pen-
alty or imposing a cease-and-desist order shall be final and 
conclusive unless the person against whom the order is issued 
files an appeal of the order in the appropriate district court 
of the United States, in accordance with subsection (d). 
(d) REVIEW BY UNITED STATES DISTRICT COURT.— 
(1) COMMENCEMENT OF ACTION.—^Any person against whom 
a violation is found and a civil penalty assessed or cease-
and-desist order issued under subsection (c) may obtain review 
of the penalty or cease-and-desist order in the district court 
of the United States for the district in which the person resides 
or carries on business, or the United States District Court 
for the District of Columbia, by— 
(A) filing a notice of appeal in the court not later 
than 30 days after the date on which the penalty is assessed 
or cease-and-desist order issued; and 
(B) simultaneously sending a copy of the notice by 
certified mail to the Secretary. 
(2) RECORD.—The Secretary shall promptly file in the court 
a certified copy of the record on which the Secretary found 
that the person committed the violation. 
(3) STANDARD OF REVIEW.—^A finding of the Secretary shall 
be set aside only if the finding is found to be unsupported 
by substantial evidence. 
(e) FAILURE TO OBEY CEASE-AND-DESIST ORDERS.—^Any person 
who fails to obey a cease-and-desist order issued by the Secretary 
after the cease-and-desist order has become final and unappealable, 
or after the appropriate United States district court has entered 
a final judgment in favor of the Secretary, shall be subject to 
a civil penalty assessed by the Secretary, after opportunity for 
a hearing and for judicial review under the procedures specified 
in subsections (c) and (d), of not more than $500 for each offense. 
Each day during which the failure continues shall be considered 
a separate violation of the cease-and-desist order. 
(f) FAILURE TO PAY PENALTIES.—If a person fails to pay an 
assessment of a civil penalty after the assessment has become 
a final and unappealable order issued by the Secretary, or after 
the appropriate United States district court has entered final judg-
ment in favor of the Secretary, the Secretary shall refer the matter 
to the Attorney General for recovery of the amount assessed in 
the district court of the United States for any district in which 
the person resides or carries on business. In an action for recovery, 
the validity and appropriateness of the final order imposing the 
civil penalty shall not be subject to review. 
7 use 7469. 
SEC. 560. INVESTIGATIONS AND POWER TO SUBPOENA. 
(a) IN GENERAL.—^The Secretary may make such investigations 
as the Secretary considers necessary— 
(1) for the effective carrjdng out of the responsibilities 
of the Secretary under this subtitle; or 
(2) to determine whether a person subject to this subtitle 
has engaged or is engaging in any act that constitutes a viola-
tion of this subtitle, or any order, rule, or regulation issued 
under this subtitle. 
PUBLIC lAW 104-127—APR. 4, 1996 
110 STAT. 1073 
(b) POWER TO SUBPOENA.— 
(1) INVESTIGATIONS.—For the purpose of an investigation 
made under subsection (a), the Secretary may administer oaths 
and affirmations and may issue subpoenas to require the 
production of any records that are relevant to the inquiry. 
The production of any such records may be required from 
any place in the United States. 
(2) ADMINISTRATIVE HEARINGS.—For the purpose of an 
administrative hearing held under section 558 or 559, the 
presiding officer is authorized to administer oaths and affirma-
tions, subpoena witnesses, compel the attendance of witnesses, 
take evidence, and require the production of any records that 
are relevant to the inquiry. The attendance of witnesses and 
the production of any such records may be required from any 
place in the United States. 
(c) AID OF COURTS.—In the case of contumacy by, or refusal 
to obey a subpoena to, any person, the Secretary may invoke the 
aid of any court of the United States within the jurisdiction of 
which the investigation or proceeding is carried on, or where the 
person resides or carries on business, to enforce a subpoena issued 
by the Secretary under subsection (b). The court may issue an 
order requiring the person to comply with the subpoena. 
(d) CONTEMPT.—^Any failure to obey the order of the court 
may be punished by the court as a contempt of the court. 
(e) PROCESS.—Process in any such case may be served in the 
judicial district in which the person resides or carries on business 
or wherever the person may be found. 
(f) HEARING SITE.—^The site of any hearing held under section 
558 or 559 shall be in the judicial district where the person affected 
by the hearing resides or has a principal place of business. 
SEC. 561. REFERENDA. 
7 USC 7470. 
(a) INITIAL REFERENDUM.— 
(1) REFERENDUM REQUIRED.—During the 60-day period 
immediately preceding the proposed effective date of an order 
issued under section 554, the Secretary shall conduct a referen-
dum among kiwifruit producers and importers who will be 
subject to assessments under the order, to ascertain whether 
producers and importers approve the implementation of the 
order. 
(2) APPROVAL OF ORDER.—^The order shall become effective, 
as provided in section 554, if the Secretary determines that— 
(A) the order has been approved by a majority of the 
producers and importers voting in the referendum; and 
(B) the producers and importers favoring approval 
produce and import more than 50 percent of the total 
volume of kiwifruit produced and imported by persons vot-
ing in the referendum. 
(b) SUBSEQUENT REFERENDA.—^The Secretary may periodically 
conduct a referendum to determine if kiwifruit producers and 
importers favor the continuation, termination, or suspension of 
any order issued under section 554 that is in effect at the time 
of the referendum. 
(c) REQUIRED REFERENDA.—^The Secretary shall hold a referen-
dum under subsection (b)— 
110 STAT. 1074 
PUBLIC LAW 104-127—APR. 4, 1996 
7 u s e 7471. 
7 u s e 7472. 
7 u s e 7473. 
(1) at the end of the 6-year period beginning on the effective 
date of the order and at the end of each subsequent 6-year 
period; 
(2) at the request of the Board; or 
(3) if not less than 30 percent of the kiwifruit producers 
and importers subject to assessments under the order submit 
a petition requesting the referendum. 
(d) VOTE.—On completion of a referendum under subsection 
(b), the Secretary shall suspend or terminate the order that was 
subject to the referendum at the end of the marketing year if— 
(1) the suspension or termination of the order is favored 
by not less than a majority of the producers and importers 
voting in the referendum; and 
(2) the producers and importers produce and import more 
than 50 percent of the total volume of kiwifruit produced and 
imported by persons voting in the referendum. 
(e) CONFIDENTIALITY.—The ballots and other information or 
reports that reveal, or tend to reveal, the vote of any person under 
this subtitle and the voting list shall be held strictly confidential 
and shall not be disclosed. 
SEC. 562. SUSPENSION OR TERMINATION. 
(a) IN GENERAL.—If the Secretary finds that an order issued 
under section 554, or a provision of the order, obstructs or does 
not tend to effectuate the purposes of this subtitle, the Secretary 
shall suspend or terminate the operation of the order or provision. 
(b) LIMITATION.—The suspension or termination of any order, 
or any provision of an order, shall not be considered an order 
under this subtitle. 
SEC. 563. REGULATIONS. 
The Secretary may issue such regulations as are necessary 
to carry out this subtitle. 
SEC. 564. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated for each fiscal year 
such sums as are necessary to carry out this subtitle. 
Popcorn 
Promotion, 
Research, and 
Consumer 
Information Act. 
7 u s e 7401 note. 
7 u s e 7481. 
Subtitle E—Popcorn 
SEC. 571. SHORT TITLE. 
This subtitle may be cited as the "Popcorn Promotion, Research, 
and Consumer Information Act". 
SEC. 572. FINDINGS AND DECLARATION OF POLICY. 
(a) FINDINGS.—Congress finds that— 
(1) popcorn is an important food that is a valuable part 
of the human diet; 
(2) the production and processing of popcorn plays a signifi-
cant role in the economy of the United States in that popcorn 
is processed by several popcorn processors, distributed through 
wholesale and retail outlets, and consumed by millions of people 
throughout the United States and foreign countries; 
(3) popcorn must be of high quality, readily available, han-
dled properly, and marketed efficiently to ensure that the bene-
fits of popcorn are available to the people of the United States; 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1075 
(4) the maintenance and expansion of existing markets 
and uses and the development of new markets and uses for 
popcorn are vital to the welfare of processors and persons 
concerned with marketing, using, and producing popcorn for 
the market, as well as to the agricultural economy of the 
United States; 
(5) 
the 
cooperative 
development, 
financing, 
and 
implementation of a coordinated program of popcorn promotion, 
research, consumer information, and industry information is 
necessary to maintain and expand markets for popcorn; and 
(6) popcorn moves in interstate and foreign commerce, and 
popcorn that does not move in those channels of commerce 
directly burdens or affects interstate commerce in popcorn. 
(b) POLICY.—It is the policy of Congress that it is in the public 
interest to authorize the establishment, through the exercise of 
the powers provided in this subtitle, of an orderly procedure for 
developing, financing (through adequate assessments on unpopped 
popcorn processed domestically), and carrying out an effective, 
continuous, and coordinated program of promotion, 
research, 
consumer information, and industry information designed to— 
(1) strengthen the position of the popcorn industry in the 
marketplace; and 
(2) maintain and expand domestic and foreign markets 
and uses for popcorn. 
(c) PURPOSES.—The purposes of this subtitle are to— 
(1) maintain and expand the markets for all popcorn prod-
ucts in a manner that— 
(A) is not designed to maintain or expand any individ-
ual share of a producer or processor of the market; 
(B) does not compete with or replace individual 
advertising or promotion efforts designed to promote 
individual brand name or trade name popcorn products; 
and 
(C) authori5i;es and funds programs that result in 
government speech promoting government objectives; and 
(2) establish a nationally coordinated program for popcorn 
promotion, research, consumer information, 
and 
industry 
information. 
(d) STATUTORY CONSTRUCTION.—This subtitle treats processors 
equitably. Nothing in this subtitle— 
(1) provides for the imposition of a trade barrier to the 
entry into the United States of imported popcorn for the domes-
tic market; or 
(2) provides for the control of production or otherwise limits 
the right of any individual processor to produce popcorn. 
SEC. 573. DEFINITIONS. 
7USC7482. 
In this subtitle (unless the context otherwise requires): 
(1) BOARD.—^The term "Board" means the Popcorn Board 
established under section 575(b). 
(2) COMMERCE.—^The term "commerce" means interstate, 
foreign, or intrastate commerce. 
(3) 
CONSUMER 
INFORMATION.—The 
term 
"consumer 
information" means information and programs that will assist 
consumers and other persons in making evaluations and deci-
sions regarding the purchase, preparation, and use of popcorn. 
110 STAT. 1076 
PUBLIC LAW 104-127—APR. 4, 1996 
(4) DEPARTMENT.—^The term "Department" means the 
Department of Agriculture. 
(5) INDUSTRY INFORMATION.—^The term "industry informa-
tion" means information or a program that will lead to the 
development o
f
— 
(A) new markets, new marketing 
strategies, or 
increased efficiency for the popcorn industry; or 
(B) activities to enhance the image of the popcorn 
industry. 
(6) MARKETING.—The term "marketing" means the sale 
or other disposition of unpopped popcorn for human consump-
tion in a channel of commerce, but does not include a sale 
or disposition to or between processors. 
(7) ORDER.—^The term "order" means an order issued under 
section 574. 
(8) PERSON.—The term "person" means an individual, group 
of individuals, partnership, corporation, association, or coopera-
tive, or any other legal entity. 
(9) POPCORN.—The term "popcorn" means unpopped pop-
corn (Zea Mays L) that is— 
(A) commercially grown; 
(B) processed in the United States by shelling, cleaning, 
or drying; and 
(C) introduced into a channel of commerce. 
(10) PROCESS.—The term "process" means to shell, clean, 
dry, and prepare popcorn for the market, but does not include 
packaging popcorn for the market without also engaging in 
another activity described in this paragraph. 
(11) PROCESSOR.—The term "processor" means a person 
engaged in the preparation of unpopped popcorn for the market 
who owns or shares the ownership and risk of loss of the 
popcorn and who processes and distributes over 4,000,000 
pounds of popcorn in the market per year. 
(12) PROMOTION.—^The term "promotion" means an action, 
including paid advertising, to enhance the image or desirability 
of popcorn. 
(13) RESEARCH.—^The term "research" means any type of 
study to advance the image, desirability, marketability, produc-
tion, product development, quality, or nutritional value of pop-
corn. 
(14) SECRETARY.—^The term "Secretary" means the Sec-
retary of Agriculture. 
(15) STATE.—^The term "State" means each of the 50 States 
and the District of Columbia. 
(16) UNITED STATES.—The term "United States" means all 
of the States. 
7 use 7483. 
SEC. 574. ISSUANCE OF ORDERS. 
(a) IN GENERAL.—^To effectuate the policy described in section 
572(b), the Secretary, subject to subsection (b), shall issue 1 or 
more orders applicable to processors. An order shall be applicable 
to all popcorn production and marketing areas in the United States. 
Not more than 1 order shall be in effect under this subtitle at 
any 1 time. 
(b) PROCEDURE.— 
(1) PROPOSAL OR REQUEST FOR ISSUANCE.—^The Secretary 
may propose the issuance of an order, or an association of 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1077 
processors or any other person that would be affected by an 
order may request the issuance of, and submit a proposal 
for, an order. 
(2) NOTICE AND COMMENT CONCERNING PROPOSED ORDER.— Publication. 
Not later than 60 days after the receipt of a request and 
proposal for an order under paragraph (1), or at such time 
as the Secretary determines to propose an order, the Secretary 
shall publish a proposed order and give due notice and oppor-
tunity for public comment on the proposed order. 
(3) ISSUANCE OF ORDER.—^After notice and opportunity for 
public comment under paragraph (2), the Secretary shall issiue 
an order, taking into consideration the comments received and 
including in the order such provisions as are necessary to 
ensure that the order conforms to this subtitle. The order 
shall be issued and become effective not later than 150 days 
after the date of publication of the proposed order. 
(c) AMENDMENTS.—The Secretary, as appropriate, may amend 
an order. The provisions of this subtitle applicable to an order 
shall be applicable to any amendment to an order, except that 
an amendment to an order may not require a referendum to become 
effective. 
SEC. 575. REQUIRED TERMS IN ORDERS. 
| 
7 USC 7484. 
(a) IN GENERAL.—^An order shall contain the terms and condi-
tions specified in this section. 
(b) ESTABLISHMENT AND MEMBERSHIP OF POPCORN BOARD:— 
(1) IN GENERAL.—The order shall provide for the establish-
ment of, and appointment of members to, a Popcorn Board 
that shall consist of not fewer than 4 members and not more 
than 9 members. 
(2) NOMINATIONS.—^The members of the Board shall be 
processors appointed by the Secretary from 
nominations 
submitted by processors in a manner authorized by the Sec-
retary, subject to paragraph (3). Not more than 1 member 
may be appointed to the Board from nominations submitted 
by any 1 processor. 
(3) GEOGRAPHICAL DIVERSITY.—In making appointments, 
the Secretary shall take into account, to the extent practicable, 
the geographical distribution of popcorn production throughout 
the United States. 
(4) TERMS.—The term of appointment of each member of 
the Board shall be 3 years, except that the members appointed 
to the initial Board shall serve, proportionately, for terms of 
2, 3, and 4 years, as determined by the Secretary. 
(5) COMPENSATION AND EXPENSES.—A member of the Board 
shall serve without compensation, but shall be reimbursed for 
the expenses of the member incurred in the performance of 
duties for the Board. 
(c) POWERS AND DUTIES OF BOARD.—The order shall define 
the powers and duties of the Board, which shall include the power 
and duty— 
(1) to administer the order in accordance with the terms 
and provisions of the order; 
(2) to issue regulations to effectuate the terms and provi-
sions of the order; 
(3) to appoint members of the Board to serve on an execu-
tive committee; 
110 STAT. 1078 
PUBLIC LAW 104-127—APR. 4, 1996 
Effective date. 
Records. 
Reports. 
(4) to propose, receive, evaluate, and approve budgets, 
plans, and projects of promotion, research, consumer informa-
tion, and industry information, and to contract with appropriate 
persons to implement the plans or projects; 
(5) to accept and receive voluntary contributions, gifts, 
and market promotion or similar funds; 
(6) to invest, pending disbursement under a plan or project, 
funds collected through assessments authorized under sub-
section (f), only in— 
(A) obligations of the United States or an agency of 
the United States; 
(B) general obligations of a State or a political-subdivi-
sion of a State; 
(C) an interest-bearing account or certificate of deposit 
of a bank that is a member of the Federal Reserve System; 
or 
(D) obligations fully guaranteed as to principal and 
interest by the United States; 
(7) to receive, investigate, and report to the Secretary com-
plaints of violations of the order; and 
(8) to recommend to the Secretary amendments to the 
order. 
(d) PLANS AND BUDGETS.— 
(1) IN GENERAL.—^The order shall provide that the Board 
shall submit to the Secretary for approval any plan or project 
of promotion, research, consumer information, or industry 
information. 
(2) BUDGETS.—^The order shall require the Board to submit 
to the Secretary for approval budgets on a fiscal year basis 
of the anticipated expenses and disbursements of the Board 
in the implementation of the order, including projected costs 
of plans and projects of promotion, research, consumer informa-
tion, and industry information. 
(e) CONTRACTS AND AGREEMENTS.— 
(1) IN GENERAL.—^The order shall provide that the Board 
may enter into contracts or agreements for the implementation 
and carrying out of plans or projects of promotion, research, 
consumer information, or industry information, including con-
tracts with a processor organization, and for the payment of 
the cost of the plans or projects with funds collected by the 
Board under the order. 
(2) REQUIREMENTS.—^A contract or agreement under para-
graph (1) shall provide that— 
(A) the contracting party shall develop and submit 
to the Board a plan or project, together with a budget 
that shows the estimated costs to be incurred for the plan 
or project; 
(B) the plan or project shall become effective on the 
approval of the Secretary; and 
(C) the contracting party shall keep accurate records 
of each transaction of the party, account for funds received 
and expended, make periodic reports to the Board of activi-
ties conducted, and make such other reports as the Board 
or the Secretary may require. 
(3) PROCESSOR ORGANIZATIONS.—^The order shall provide 
that the Board may contract with processor organizations for 
any services required in addition to the services described in 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1079 
paragraph (1). The contract shall include provisions comparable 
to the provisions required by paragraph (2). 
(f) ASSESSMENTS.— 
(1) PROCESSORS.—The order shall provide that each proc-
essor marketing popcorn in the United States or for export 
shall, in the manner prescribed in the order, pay assessments 
and remit the assessments to the Board. 
(2) DIRECT MARKJETERS.—^A processor that markets popcorn 
produced by the processor directly to consumers shall pay and 
remit the assessments on the popcorn directly to the Board 
in the manner prescribed in the order. 
(3) RATE.— 
(A) IN GENERAL.—The rate of assessment prescribed 
in the order shall be a rate established by the Board 
but not more than $.08 per hundredweight of popcorn. 
(B) ADJUSTMENT OF RATE.—The order shall provide 
that the Board, with the approval of the Secretary, may 
raise or lower the rate of assessment annually up to a 
maximum of $.08 per hundredweight of popcorn. 
(4) USE OF ASSESSMENTS.— 
(A) IN GENERAL.—Subject to subparagraphs (B) and 
(C) and subsection (c)(5), the order shall provide that the 
assessments collected shall be used by the Board— 
(i) to pay expenses incurred in implementing and 
administering the order, with provision for a reason-
able reserve; and 
(ii) to cover such administrative costs as are 
incurred by the Secretary, except that the administra-
tive costs incurred by the Secretary (other than any 
legal expenses incurred to defend and enforce the 
order) that may be reimbursed by the Board may not 
exceed 15 percent of the projected annual revenues 
of the Board. 
(B) 
EXPENDITURES BASED ON SOURCE OF ASSESS-
MENTS.—In implementing plans and projects of promotion, 
research, consumer information, and industry information, 
the Board shall expend funds on— 
(i) plans and projects for popcorn marketed in the 
United States or Canada in proportion to the amount 
of assessments collected on domestically marketed pop-
corn; and 
(ii) plans and projects for exported popcorn in 
proportion to the amount of assessments collected on 
exported popcorn. 
(C) NOTIFICATION.—If the administrative costs incurred 
by the Secretary that are reimbursed by the Board exceed 
10 percent of the projected annual revenues of the Board, 
the Secretary shall notify as soon as practicable the 
Committee on Agriculture of the House of Representatives 
and the Committee on Agriculture, Nutrition, and Forestry 
of the Senate. 
(g) PROHIBITION ON USE OF FUNDS.—The order shall prohibit 
any funds collected by the Board under the order from being used 
to influence government action or policy, other than the use of 
funds by the Board for the development and recommendation to 
the Secretary of amendments to the order. 
110 STAT. 1080 
PUBLIC LAW 104-127—APR. 4, 1996 
(h) BOOKS AND RECORDS OF THE BOARD.—^The order shall 
require the Board to— 
(1) maintain such books and records (which shall be avail-
able to the Secretary for inspection and audit) as the Secretary 
may prescribe; 
Reports. 
(2) prepare and submit to the Secretary, from time to 
time, such reports as the Secretary may prescribe; and 
(3) account for the receipt and disbursement of all funds 
entrusted to the Board. 
(i) BOOKS AND RECORDS OF PROCESSORS.— 
(1) MAINTENANCE AND REPORTING OF INFORMATION.—The 
order shall require that each processor of popcorn for the mar-
ket shall— 
(A) maintain, and make available for inspection, such 
books and records as are required by the order; and 
Reports. 
(B) file reports at such time, in such manner, and 
having such content as is prescribed in the order. 
(2) USE OF INFORMATION.—^The Secretary shall authorize 
the use of information regarding processors that may be 
accumulated under a law or regulation other than this subtitle 
or a regulation issued under this subtitle. The information 
shall be made available to the Secretary as appropriate for 
the administration or enforcement of this subtitle, the order, 
or any regulation issued under this subtitle. 
(3) CONFIDENTIALITY.— 
(A) IN GENERAL.—Subject to subparagraphs (B), (C), 
and (D), all information obtained by the Secretary under 
paragraphs (1) and (2) shall be kept confidential by all 
officers, employees, and agents of the Board and the 
Department. 
(B) DISCLOSURE BY SECRETARY.—Information referred 
to in subparagraph (A) may be disclosed if— 
(i) the Secretary considers the information rel-
evant; 
(ii) the information is revealed in a suit or adminis-
trative hearing brought at the request of the Secretary, 
or to which the Secretary or any officer of the United 
States is a party; and 
(iii) the information relates to the order. 
(C) DISCLOSURE TO OTHER AGENCY OF FEDERAL GOVERN-
MENT.— 
(i) IN GENERAL.—No information obtained under 
the authority of this subtitle may be made available 
to another agency or officer of the Federal Government 
for any purpose other than the implementation of this 
subtitle and any investigatory or enforcement activity 
necessary for the implementation of this subtitle. 
(ii) PENALTY.—^A person who knowingly violates 
this subparagraph shall, on conviction, be subject to 
a fine of not more than $1,000 or to imprisonment 
for not more than 1 year, or both, and if an officer, 
employee, or agent of the Board or the Department, 
shall be removed from office or terminated from 
emplo3nnent, as applicable. 
(D) GENERAL STATEMENTS.—^Nothing in this paragraph 
prohibits— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1081 
(i) the issuance of general statements based on 
the reports of a number of persons subject to an order 
or statistical data collected from the reports, if the 
statements do not identify the information provided 
by any person; or 
' 
(ii) the publication, by direction of the Secretary, 
of the name of a person violating the order, together 
with a statement of the particular provisions of the 
order violated by the person. 
(j) OTHER TERMS AND CONDITIONS.—The order shall contain 
such other terms and conditions, consistent with this subtitle, as 
are necessary to effectuate this subtitle, including regulations relat-
ing to the assessment of late payment charges. 
SEC. 576. REFERENDA. 
7 USC 7485. 
(a) INITIAL REFERENDUM.— 
(1) IN GENERAL.—Within the 60-day period immediately 
preceding the effective date of an order, as provided in section 
574(b)(3), the Secretary shall conduct a referendum among 
processors who, during a representative period as determined 
by the Secretary, h£ive been engaged in processing, for the 
purpose of ascertaining whether the order shall go into effect. 
(2) APPROVAL OF ORDER.—The order shall become effective, 
as provided in section 574(b), only if the Secretary determines 
that the order has been approved by not less than a majority 
of the processors voting in the referendum and if the majority 
processed more than 50 percent of the popcorn certified as 
having been processed, during the representative period, by 
the processors voting. 
(b) ADDITIONAL REFERENDA.— 
(1) IN GENERAL.—Not earlier than 3 years after the effective 
date of an order approved under subsection (a), on the request 
of the Board or a representative group of processors, as 
described in paragraph (2), the Secretary may conduct addi-
tional referenda to determine whether processors favor the 
suspension or termination of the order. 
(2) REPRESENTATIVE GROUP OF PROCESSORS.—An additional 
referendum on an order shall be conducted if the referendum 
is requested by 30 percent or more of the number of processors 
who, during a representative period as determined by the Sec-
retary, have been engaged in processing. 
(3) DISAPPROVAL OF ORDER.—If the Secretary determines, Termination 
in a referendum conducted under paragraph (1), that suspen- date, 
sion or termination of the order is favored by at least % 
of the processors voting in the referendum, the Secretary shall— 
(A) suspend or terminate, as appropriate, collection 
of assessments under the order not later than 180 days 
after the date of determination; and 
(B) suspend or terminate the order, as appropriate, 
in an orderly manner as soon as practicable after the 
date of determination. 
(c) COSTS OF REFERENDUM.—^The Secretary shall be reimbursed 
from assessments collected by the Board for any expenses incurred 
by the Secretary in connection with the conduct of any referendum 
under this section. 
110 STAT. 1082 
PUBLIC LAW 104-127—APR. 4, 1996 
(d) METHOD OF CONDUCTING REFERENDUM.—Subject to this 
section, a referendum conducted under this section shall be con-
ducted in such manner as is determined by the Secretary. 
(e) CONFIDENTIALITY OF BALLOTS AND OTHER INFORMATION.— 
(1) IN GENERAL.—^The ballots and other information or 
reports that reveal or tend to reveal the vote of any processor, 
or any business operation of a processor, shall be considered 
to be strictly confidential and shall not be disclosed. 
(2) PENALTY FOR VIOLATIONS.—^An officer or employee of 
the Department who knowingly violates paragraph (1) shall 
be subject to the penalties described in section 575(i)(3)(C)(ii). 
7 use 7486. 
SEC. 577. PETITION AND REVIEW. 
(a) PETITION.— 
(1) IN GENERAL.—^A person subject to an order may file 
with the Secretary a petition— 
(A) stating that the order, a provision of the order, 
or an obligation imposed in connection with the order is 
not established in accordance with law; and 
(B) requesting a modification of the order or obligation 
or an exemption from the order or obligation. 
(2) STATUTE OF LIMITATIONS.—^A petition under paragraph 
(1) concerning an obligation may be filed not later than 2 
years after the date of imposition of the obligation. 
(3) HEARINGS.—The petitioner shall be given the oppor-
tunity for a hearing on a petition filed under paragraph (1), 
in accordance with regulations issued by the Secretary. 
(4) RULING.—^After a hearing under paragraph (3), the Sec-
retary shall issue a ruling on the petition that is the subject 
of the hearing, which shall be final if the ruling is in accordance 
with applicable law. 
Courts. 
(b) REVIEW.— 
(1) COMMENCEMENT OF ACTION.—The district court of the 
United States for any district in which a person who is a 
petitioner under subsection (a) resides or carries on business 
shall have jurisdiction to review a ruling on the petition, if 
the person files a complaint not later than 20 days after the 
date of issuance of the ruling under subsection (a)(4). 
(2) PROCESS.—Service of process in a proceeding under 
paragraph (1) may be made on the Secretary by delivering 
a copy of the complaint to the Secretary. 
(3) REMANDS.—If the court determines, under paragraph 
(1), that a ruling issued under subsection (a)(4) is not in accord-
ance with applicable law, the court shall remand the matter 
to the Secretary with directions— 
(A) to make such ruling as the court shall determine 
to be in accordance with law; or 
(B) to take such further proceedings as, in the opinion 
of the court, the law requires. 
(c) ENFORCEMENT.—The pendency of proceedings instituted 
under subsection (a) may not impede, hinder, or delay the Secretary 
or the Attorney General from taking action under section 578. 
7 use 7487. 
SEC. 578. ENFORCEMENT. 
(a) IN GENERAL.—^The Secretary may issue an enforcement 
order to restrain or prevent any person from violating an order 
or regulation issued under this subtitle and may assess a civil 
penalty of not more than $1,000 for each violation of the enforce-
PUBLIC L^W 104-127—APR. 4, 1996 
110 STAT. 1083 
merit order, after an opportunity for an administrative hearing, 
if the Secretary determines that the administration and enforcement 
of the order and this subtitle would be adequately served by such 
a procedure. 
(b) JURISDICTION.—The district courts of the United States Courts. 
are vested with jurisdiction specifically to enforce, and to prevent 
and restrain any person from violating, an order or regulation 
issued under this subtitle. 
(c) REFERRAL TO ATTORNEY GENERAL.—^A civil action authorized 
to be brought under this section shall be referred to the Attorney 
General for appropriate action. 
SEC. 579. INVESTIGATIONS AND POWER TO SUBPOENA. 
7 USC 7488. 
(a) INVESTIGATIONS.—The Secretary may make such investiga-
tions as the Secretary considers necessary— 
(1) for the effective administration of this subtitle; and 
(2) to determine whether any person subject to this subtitle 
has engaged, or is about to engage, in an act that constitutes 
or will constitute a violation of this subtitle or of an order 
or regulation issued under this subtitle. 
(b) OATHS, AFFIRMATIONS, AND SUBPOENAS.—For the purpose 
of an investigation under subsection (a), the Secretary may admin-
ister oaths and affirmations, subpoena witnesses, compel the attend-
ance of witnesses, take evidence, and require the production of 
any records that are relevant to the inquiry. The attendance of 
witnesses and the production of records may be required from 
any place in the United States. 
(c) AID OF COURTS.— 
(1) REQUEST.—In the case of contumacy by, or refusal to 
obey a subpoena issued to, any person, the Secretary may 
request the aid of any court of the United States within the 
jurisdiction of which the investigation or proceeding is carried 
on, or where the person resides or carries on business, in 
requiring the attendance and testimony of the person and the 
production of records. 
(2) ENFORCEMENT ORDER OF THE COURT.—^The court may 
issue an enforcement order requiring the person to appear 
.. 
before the Secretary to produce records or to give testimony 
concerning the matter under investigation. 
(3) CONTEMPT.—^A failure to obey an enforcement order 
of the court under paragraph (2) may be punished by the 
court as a contempt of the court. 
(4) PROCESS.—^Process in a case under this subsection may 
be served in the judicial district in which the person resides 
or carries on business or wherever the person may be found. 
SEC. 580. RELATION TO OTHER PROGRAMS. 
7 USC 7489. 
Nothing in this subtitle preempts or supersedes any other 
program relating to popcorn promotion organized and operated 
under the laws of the United States or any State. 
SEC. 581. REGULATIONS. 
7 USC 7490. 
The Secretary may issue such regulations as are necessary 
to carry out this subtitle. 
SEC. 582. AUTHORIZATION OF APPROPRIATIONS. 
7 USC 7491. 
There are authorized to be appropriated such sums as are 
necessary to carry out this subtitle. Amounts made available under 
110 STAT. 1084 
PUBLIC LAW 104-127—APR. 4, 1996 
this section or otherwise made available to the Department, and 
amounts made available under any other marketing or promotion 
order, may not be used to pay any administrative expense of the 
Board. 
Subtitle F—Miscellaneous 
SEC. 591. MAINTENANCE OF RECORDS FOR HONEY PROMOTION PRO-
GRAM. 
Section 9(f) of the Honey Research, Promotion, and Consumer 
Information Act (7 U.S.C. 4608(f)) is amended by inserting "produc-
ers," after "importers,". 
TITLE VI—CREDIT 
Subtitle A—Farm Ownership Loans 
SEC. 601. LIMITATION ON DIRECT FARM OWNERSHIP LOANS. 
Section 302 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1922) is amended by striking subsection (b) and 
inserting the following: 
"(b) DIRECT LOANS.— 
"(1) IN GENERAL.—Subject to paragraph (3), the Secretary 
may make a direct loan under this subtitle only to a farmer 
or rancher who has operated a farm or ranch for not less 
than 3 years and— 
"(A) is a qualified beginning farmer or rancher; 
"(B) has not received a previous direct farm ownership 
loan made under this subtitle; or 
"(C) has not received a direct farm ownership loan 
under this subtitle more than 10 years before the date 
the new loan would be made. 
"(2) YOUTH LOANS.—The operation of an enterprise by a 
youth under section 311(b) shall not be considered the operation 
of a farm or ranch for purposes of paragraph (1). 
"(3) TRANSITION RULE.— 
"(A) IN GENERAL.—Subject to subparagraphs (B) and 
(C), the Secretary may make a direct loan under this sub-
title to a farmer or rancher who has a direct loan outstand-
ing under this subtitle on the date of enactment of this 
paragraph. 
"(B) LESS THAN 5 YEARS.—If, as of the date of enact-
ment of this paragraph, a farmer or rancher has had a 
direct loan outstanding under this subtitle for less than 
5 years, the Secretary shall not make a loan to the farmer 
or rancher under subparagraph (A) after the date that 
is 10 years after the date of enactment of this paragraph. 
"(C) 5 YEARS OR MORE.—If, as of the date of enactment 
of this paragraph, a farmer or rancher has had a direct 
loan outstanding under this subtitle for 5 years or more, 
the Secretary shall not make a loan to the farmer or 
rancher under subparagraph (A) after the date that is 
5 years after the date of enactment of this paragraph.". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1085 
SEC. 602. PURPOSES OF LOANS. 
(a) IN GENERAL.—Section 303 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1923) is amended to read as 
follows: 
"SEC. 303. PURPOSES OF LOANS. 
"(a) ALLOWED PURPOSES.— 
"(1) DIRECT LOANS.—^A farmer or rancher may use a direct 
loan made under this subtitle only for— 
"(A) acquiring or enlarging a farm or ranch; 
"(B) making capital improvements to a farm or ranch; 
"(C) paying loan closing costs related to acquiring, 
enlarging, or improving a farm or ranch; or 
"(D) paying for activities to promote soil and water 
conservation and protection described in section 304 on 
a farm or ranch. 
"(2) GUARANTEED LOANS.—^A farmer or rancher may use 
a loan guaranteed under this subtitle only for— 
"(A) acquiring or enlarging a farm or ranch; 
"(B) making capital improvements to a farm or ranch; 
"(C) paying loan closing costs related to acquiring, 
enlarging, or improving a farm or ranch; 
"(D) paying for activities to promote soil and water 
conservation and protection described in section 304 on 
a farm or ranch; or 
"(E) refinancing indebtedness. 
"(b) PREFERENCES.—In making or guaranteeing a loan under 
this subtitle for purchase of a farm or ranch, the Secretary shall 
give preference to a person who— 
"(1) has a dependent family; 
"(2) to the extent practicable, is able to make an initial 
down payment on the farm or ranch; or 
"(3) is an owner of livestock or farm or ranch equipment 
that is necessary to successfully carry out farming or ranching 
operations. 
"(c) HAZARD INSURANCE REQUIREMENT.— 
"(1) IN GENERAL.—^After the Secretary makes the deter-
mination required by paragraph (2), the Secretary may not 
make a loan to a farmer or rancher under this subtitle unless 
the farmer or rancher has, or agrees to obtain, hazard insurance 
on any real property to be acquired or improved with the 
loan. 
"(2) DETERMINATION.—Not later than 180 days after the 
date of enactment of this subsection, the Secretary shall deter-
mine the appropriate level of insurance to be required under 
paragraph (1).". 
(b) TRANSITIONAL PROVISION.—Section 303(c)(1) of the Consoli- 7 use 1923 note, 
dated Farm and Rural Development Act shall not apply until the 
Secretary of Agriculture makes the determination required by sec-
tion 303(c)(2) of the Act. 
SEC. 
603. 
SOIL 
AND 
WATER 
CONSERVATION 
AND 
PROTECTION. 
Section 304 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1924) is amended— 
(1) by striking subsections (b) and (c); 
(2) by striking "SEC. 304. (a)(1) Loans" and inserting the 
following: 
110 STAT. 1086 
PUBLIC LAW 104-127—APR. 4, 1996 
"SEC. 304. SOIL AND WATER CONSERVATION AND PROTECTION. 
"(a) IN GENERAL.—Loans"; 
(3) by striking "(2) In making or insuring" and inserting 
the following: 
"(b) PRIORITY.—In making or guaranteeing"; 
(4) by striking "(3) The Secretary" and inserting the follow-
ing: 
"(c) LOAN MAXIMUM.—The Secretary"; 
(5) by redesignating subparagraphs (A) through (F) of sub-
section (a) (as amended by paragraph (2)) as paragraphs (1) 
through (6), respectively; and 
(6) by redesignating subparagraphs (A) and (B) of sub-
section (c) (as amended by paragraph (4)) as paragraphs (1) 
and (2), respectively. 
SEC. 604. INTEREST RATE REQUIREMENTS. 
Section 307(a)(3) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1927(a)(3)) is amended— 
(1) in subparagraph (B), by inserting "subparagraph (D) 
and in" after "Except as provided in"; and 
(2) by adding at the end the following: 
"(D) JOINT FINANCING ARRANGEMENT.—If a direct farm 
ownership loan is made under this subtitle as part of 
a joint financing arrangement and the amount of the direct 
farm ownership loan does not exceed 50 percent of the 
total principal amount financed under the arrangement, 
the interest rate on the direct farm ownership loan shall 
be at least 4 percent annually.". 
SEC. 605. INSURANCE OF LOANS. 
Section 308 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1928) is amended to read as follows: 
"SEC. 308. FULL FAITH AND CREDIT. 
"(a) IN GENERAL.—^A contract of insurance or guarantee 
executed by the Secretary under this title shall be an obligation 
supported by the full faith and credit of the United States. 
"(b) CONTESTABILITY.—^A contract of insurance or guarantee 
executed by the Secretary under this title shall be incontestable 
except for fraud or misrepresentation that the lender or any 
holder— 
"(1) has actual knowledge of at the time the contract or 
guarantee is executed; or 
"(2) participates in or condones.". 
SEC. 606. LOANS GUARANTEED. 
Section 309(h) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1929(h)) is amended by adding at the end 
the following: 
"(4) MAXIMUM GUARANTEE OF 90 PERCENT.—Except as pro-
vided in paragraphs (5) and (6), a loan guarantee under this 
title shall be for not more than 90 percent of the principal 
and interest due on the loan. 
"(5) REFINANCED LOANS GUARANTEED AT 95 PERCENT.—The 
Secretary shall guarantee 95 percent of— 
"(A) in the case of a loan that solely refinances a 
direct loan made under this title, the principal and interest 
due on the loan on the date of the refinancing; or 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1087 
"(B) in the case of a loan that is used for multiple 
purposes, the portion of the loan that refinances the prin-
cipal and interest due on a direct loan made under this 
title that is outstanding on the date the loan is guaranteed. 
"(6) BEGINNING FARMER LOANS GUARANTEED UP TO 95 PER-
CENT.—^The Secretarjf may guarantee not more than 95 percent 
of— 
"(A) a farm ownership loan for acquiring a farm or 
ranch to a borrower who is participating in the down pay-
ment loan program under section 3ICE; or 
"(B) an operating loan to a borrower who is participat-
ing in the down payment loan program under section 310E 
that is made during the period that the borrower has 
a direct loan outstanding under this subtitle for acquiring 
a farm or ranch.". 
Subtitle B—Operating Loans 
SEC. 611. LIMITATION ON DIRECT OPERATING LOANS. 
(a) IN GENERAL.—Section 311 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1941) is amended by striking 
subsection (c) and inserting the following: 
"(c) DIRECT LOANS.— 
"(1) IN GENERAL.—Subject to paragraph (3), the Secretary 
may make a direct loan under this subtitle only to a farmer 
or rancher who— 
"(A) is a qualified beginning farmer or rancher who 
has not operated a farm or ranch, or who has operated 
a farm or ranch for not more than 5 years; 
"(B) has not received a previous direct operating loan 
made under this subtitle; or 
"(C) has received a previous direct operating loan made 
under this subtitle during 6 or fewer years. 
"(2) YOUTH LOAJ^JS.—In this subsection, the term 'direct 
operating loan' shall not include a loan made to a youth under 
subsection (b). 
"(3) TRANSITION RULE.—If, as of the date of enactment 
of this paragraph, a farmer or rancher has received a direct 
operating loan under this subtitle during each of 4 or more 
previous years, the borrower shall be eligible to receive a direct 
operating loan under this subtitle during 3 additional years 
after the date of enactment of this paragraph.". 
(b) YOUTH ENTERPRISES NOT FARMING OR RANCHING.—Section 
311(b) of the Consolidated Farm and Rural Development Act (7 
U.S.C. 1941(b)) is amended by adding at the end the following: 
"(4) YOUTH ENTERPRISES NOT FARMING OR RANCHING.—^The 
operation of an enterprise by a youth under this subsection 
shall not be considered the operation of a farm or ranch under 
this title.". 
SEC. 612. PURPOSES OF OPERATING LOANS. 
(a) IN GENERAL.—Section 312 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1942) is amended to read as 
follows: 
110 STAT. 1088 
PUBLIC LAW 104-127—APR. 4, 1996 
"SEC. 312. PURPOSES OF LOANS. 
"(a) IN GENERAL.—^A direct loan may be made under this sub-
title only for— 
"(1) paying the costs incident to reorganizing a farm or 
ranch for more profitable operation; 
"(2) purchasing livestock, poultry, or farm or ranch equip-
ment; 
"(3) purchasing feed, seed, fertilizer, insecticide, or farm 
or ranch supplies, or to meet other essential farm or ranch 
operating expenses, including cash rent; 
"(4) financing land or water development, use, or conserva-
tion; 
"(5) paying loan closing costs; 
"(6) assisting a farmer or rancher in changing the equip-
ment, facilities, or methods of operation of a farm or ranch 
to comply with a standard promulgated under section 6 of 
the Occupational Safety and Health Act of 1970 (29 U.S.C. 
655) or a standard adopted by a State under a plan approved 
under section 18 of the Act (29 U.S.C. 667), if the Secretary 
determines that without assistance under this paragraph the 
farmer or rancher is likely to suffer substantial economic injury 
in complying with the standard; 
"(7) training a limited-resource borrower receiving a loan 
under section 310D in maintaining records of farming and 
ranching operations; 
"(8) training a borrower under section 359; 
"(9) refinancing the indebtedness of a borrower, if the bor-
rower— 
"(A) has refinanced a loan under this subtitle not more 
than 4 times previously; and 
"(B)(i) is a direct loan borrower under this title at 
the time of the refinancing and has suffered a qualifying 
loss because of a natural disaster declared by the Secretary 
under this title or a major disaster or emergency designated 
by the President under the Robert T. Stafford Disaster 
Relief and Emergency Assistance Act (42 U.S.C. 5121 et 
seq.); or 
"(ii) is refinancing a debt obtained from a creditor 
other than the Secretary; or 
"(10) providing other farm, ranch, or home needs, including 
family subsistence. 
"(b) GUARANTEED LOANS.—^A loan may be guaranteed under 
this subtitle only for— 
"(1) paying the costs incident to reorganizing a farm or 
ranch for more profitable operation; 
"(2) purchasing livestock, poultry, or farm or ranch equip-
ment; 
"(3) purchasing feed, seed, fertilizer, insecticide, or farm 
or ranch supplies, or to meet other essential farm or ranch 
operating expenses, including cash rent; 
"(4) financing land or water development, use, or conserva-
tion; 
"(5) refinEincing indebtedness; 
"(6) paying loan closing costs; 
"(7) assisting a farmer or rancher in changing the equip-
ment, facilities, or methods of operation of a farm or ranch 
to comply with a standard promulgated under section 6 of 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1089 
the Occupational Safety and Health Act of 1970 (29 U.S.C. 
655) or a standard adopted by a State under a plan approved 
under section 18 of the Act (29 U.S.C. 667), if the Secretary 
determines that without assistance under this paragraph the 
farmer or rancher is likely to suffer substantial economic injury 
due to compliance with the standard; 
"(8) training a borrower under section 359; or 
"(9) providing other farm, ranch, or home needs, including 
family subsistence. 
"(c) HAZARD INSURANCE REQUIREMENT.— 
"(1) IN GENERAL.—^After the Secretary makes the deter-
mination required by paragraph (2), the Secretary may not 
make a loan to a farmer or rancher under this subtitle unless 
the farmer or rancher has, or agrees to obtain, hazard insurance 
on the property to be acquired with the loan. 
"(2) DETERMINATION.—Not later than 180 days after the 
date of enactment of this paragraph, the Secretary shall deter-
mine the appropriate level of insurance to be required by para-
graph (1). 
"(d) PRIVATE RESERVE.— 
"(1) IN GENERAL.—Notwithstanding any other provision of 
this title, the Secretary may reserve a portion of any loan 
made under this subtitle to be placed in an unsupervised bank 
account that may be used at the discretion of the borrower 
for the basic family needs of the borrower and the immediate 
family of the borrower. 
"(2) LIMIT ON SIZE OF THE RESERVE.—The size of the reserve 
shall not exceed the least of— 
"(A) 10 percent of the loan; 
"(B) $5,000; or 
"(C) the amount needed to provide for the basic family 
needs of the borrower and the borrower's immediate family 
for 3 calendar months.", 
(b) TRANSITIONAL PROVISION.—Section 312(c)(1) of the ConsoH- 7 use 1942 note. 
dated Farm and Rural Development Act shall not apply until the 
Secretary of Agriculture makes the determination required by sec-
tion 312(c)(2) of the Act. 
SEC. 613. PARTICIPATION IN LOANS. 
^ 
Section 315 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1945) is repealed. 
SEC. 614. LINE-OF-CREDIT LOANS. 
Section 316 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1946) is amended by adding at the end the following: 
"(c) LINE-OF-CREDIT LOANS.— 
"(1) IN GENERAL.—^A loan made or guaranteed by the Sec-
retary under this subtitle may be in the form of a line-of-
credit loan. 
"(2) TERM.—^A line-of-credit loan under paragraph (1) shall 
terminate not later than 5 years after the date that the loan 
is made or guaranteed. 
"(3) ELIGIBILITY.—For purposes of determining eligibility 
for a farm operating loan under this subtitle, each year during 
which a farmer or rancher takes an advance or draws on 
a line-of-credit loan the farmer or rancher shall be considered 
to have received an operating loan for 1 year. 
110 STAT. 1090 
PUBLIC LAW 104-127—APR. 4, 1996 
"(4) TERMINATION OF DELINQUENT LOANS.—If a borrower 
does not pay an installment on a line-of-credit loan on schedule, 
the borrower may not take an advance or draw on the line-
of-credit, unless the Secretary determines that— 
"(A) the borrower's failure to pay on schedule was 
due to unusual conditions that the borrower could not 
control; and 
"(B) the borrower will reduce the line-of-credit balance 
to the scheduled level at the end o
f
— 
"(i) the production cycle; or 
"(ii) the marketing of the borrower's agricultural 
products. 
"(5) AGRICULTURAL COMMODITIES.—^A line-of-credit loan 
may be used to finance the production or marketing of an 
agricultural commodity that— 
"(A) is eligible for a price support program of the 
Department of Agriculture; or 
"(B) was eligible for a price support program of the 
Department of Agriculture on the day before the date of 
enactment of the Federal Agriculture Improvement and 
Reform Act of 1996.". 
SEC. 615. INSURANCE OF OPERATING LOANS. 
Section 317 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1947) is repealed. 
SEC. 616. SPECIAL ASSISTANCE FOR BEGINNING FARMERS AND 
RANCHERS. 
(a) IN GENERAL.—Section 318 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1948) is repealed. 
(b) CONFORMING AMENDMENT.—Section 3 IGF of the Consoli-
dated Farm and Rural Development Act (7 U.S.C. 1936) is repealed. 
SEC. 617. LIMITATION ON PERIOD FOR WHICH BORROWERS ARE 
ELIGIBLE FOR GUARANTEED ASSISTANCE. 
Section 319 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1949) is amended by striking subsection (b) and 
inserting the following: 
"(b) LIMITATION ON PERIOD BORROWERS ARE ELIGIBLE FOR 
GUARANTEED ASSISTANCE.— 
"(1) GENERAL RULE.—Subject to paragraph (2), the Sec-
retary shall not guarantee a loan under this subtitle for a 
borrower for any year after the 15th year that a loan is made 
to, or a guarantee is provided with respect to, the borrower 
under this subtitle. 
"(2) TRANSITION RULE.—If, as of October 28, 1992, a farmer 
or rancher has received a direct or guaranteed operating loan 
under this subtitle during each of 10 or more previous years, 
the borrower shall be eligible to receive a guaranteed operating 
loan under this subtitle during 5 additional years after October 
28, 1992.". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1091 
Subtitle C—Emergency Loans 
SEC. 621. HAZARD INSURANCE REQUIREMENT. 
(a) IN GENERAL.—Section 321 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1961) is amended by striking 
subsection (b) and inserting the following: 
"(b) HAZARD INSURANCE REQUIREMENT.— 
"(1) IN GENERAL.—^After the Secretary makes the deter-
mination required by paragraph (2), the Secretary may not 
make a loan to a farmer or rancher under this subtitle to 
cover a property loss unless the farmer or rancher had hazard 
insurance that insured the property at the time of the loss. 
"(2) DETERMINATION.—Not later than 180 days after the 
date of enactment of this paragraph, the Secretary shall deter-
mine the appropriate level of insurance to be required under 
paragraph (1).". 
(b) TRANSITIONAL PROVISION.—Section 321(b)(1) of the Consoli- 7 use i96i note, 
dated Farm and Rural Development Act shall not apply until the 
Secretary of Agriculture makes the determination required by sec-
tion 321(b)(2) of the Act. 
SEC. 622. NARROWING OF AUTHORITY TO WAIVE APPLICATION OF 
THE CREDIT ELSEWHERE TEST. 
The second proviso of section 322(b) of the Consolidated Farm 
and Rural Development Act (7 U.S.C. 1962(b)) is amended by strik-
ing "$300,000 or less" and inserting "$100,000 or less". 
SEC. 623. LINKING OF EMERGENCY LOANS FOR CROP OR LIVESTOCK 
CHANGES TO NATURAL DISASTERS. 
Section 323 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1963) is amended by inserting "that are necessitated 
by a natural disaster, major disaster, or emergency and that are" 
after "livestock changes". 
SEC. 624. MAXIMUM EMERGENCY LOAN INDEBTEDNESS. 
Section 324 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1964) is amended by striking "SEC. 324. (a) No 
loan" and all that follows through the end of subsection (a) and 
inserting the following: 
"SEC. 324. TERMS OF LOANS. 
"(a) MAXIMUM AMOUNT OF LOAN.—^The Secretary may not make 
a loan under this subtitle to a borrower who has suffered a loss 
in an amount that— 
"(1) exceeds the actual loss caused by a disaster; or 
"(2) would cause the total indebtedness of the borrower 
under this subtitle to exceed $500,000.". 
SEC. 625. ESTABLISHMENT OF DATE FOR EMERGENCY LOAN ASSET 
VALUATION. 
The last sentence of section 324(d) of the Consolidated Farm 
and Rural Development Act (7 U.S.C. 1964(d)) is amended by strik-
ing "value the assets" and all that follows through the period 
and inserting "establish the value of the assets as of the day 
before the occurrence of the natural disaster, major disaster, or 
emergency that is the basis for a request for assistance under 
110 STAT. 1092 
PUBLIC LAW 104-127—APR. 4, 1996 
this subtitle or the Robert T. Stafford Disaster Relief and Emer-
gency Assistance Act (42 U.S.C. 5121 et seq.).". 
SEC. 626. INSURANCE OF EMERGENCY LOANS. 
Section 328 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1968) is repealed. 
Subtitle D—^Administrative Provisions 
SEC. 631. TEMPORARY AUTHORITY TO ENTER INTO CONTRACTS. 
Section 331 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1981) is amended by adding at the end the following: 
"(d) TEMPORARY AUTHORITY TO ENTER INTO CONTRACTS.— 
"(1) DEFINITIONS.—In this subsection: 
"(A) 
ELIGIBLE 
FINANCIAL 
INSTITUTION.—The 
term 
'eligible financial institution' means a financial institution 
with substantial experience in farm, ranch, or aquaculture 
lending that is regulated by the Comptroller of the Cur-
rency, the Farm Credit Administration, or a similar regu-
latory body. 
"(B) PILOT PROJECT.—The term 'pilot project' includes 
services related to borrower loan documentation, financial 
information, credit history, and appraisals of real estate 
and chattel. 
"(2) AUTHORITY.—The Secretary may enter into a contract 
with an eligible financial institution for servicing a farmer 
program loan under this title, including 1 or more pilot projects. 
"(3) REPORT.—Not later than September 30, 1997, and 
September 30 of each year thereafter, the Secretary shall report 
to Congress on— 
"(A) the Secretary's experience in using contracts under 
paragraph (2); and 
"(B) recommendations for legislation related to this 
subsection, if any. 
"(4) SAVINGS CLAUSE.—^Nothing in this subsection shall 
limit the authority of the Secretary or an eligible financial 
institution to contract for any services under this Act or any 
other law. 
"(5) SUNSET PROVISION.—This subsection shall be effective 
until September 30, 2002.". 
SEC. 632. USE OF COLLECTION AGENCIES. 
Section 331 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1981) (as amended by section 631) is amended by 
adding at the end the following: 
"(e) PRIVATE COLLECTION AGENCY.—^The Secretary may 
use 
a private collection agency to collect a claim or obligation described 
in subsection (b)(5).". 
SEC. 633. N O T I C E OF LOAN SERVICE PROGRAMS. 
Section 331D(a) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1981d(a)) is amended by striking "180 days 
delinquent in" and inserting "90 days past due on". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1093 
SEC. 634. CLARIFICATION OF WRITTEN STATEMENT REQUIRED OF 
BORROWERS. 
Section 333(1)(B) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1983(1)(B)) is amended by striking "a written 
statement showing the applicant's net worth" and inserting "an 
appropriate written financial statement". 
SEC. 635. ANNUAL REVIEW OF THE CREDIT HISTORY, BUSINESS OPER-
ATION, AND CONTINUED ELIGIBILITY OF A BORROWER. 
(a) IN GENERAL.—Section 333 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1983) is amended— 
(1) by redesignating paragraphs (2), (3), and (4) as para-
graphs (3), (4), and (5), respectively; and 
(2) by inserting after paragraph (1) the following: 
"(2) except with respect to a loan under section 306, 310B, 
or 314, the county or area committee established under section 
8(b)(5)(B) of the Soil Conservation and Domestic Allotment 
Act (16 U.S.C. 590h(b)(5)(B)) to certify in writing— 
"(A) that an annual review of the credit history and 
business operation of the borrower has been conducted; 
and 
"(B) that a review of the continued eligibility of the 
borrower for the loan has been conducted;". 
(b) CONFORMING AMENDMENT.—The third sentence of section 
310B(a) of the Consolidated Farm and Rural Development Act 
(7 U.S.C. 1932(a)) is amended by striking "(3) of and inserting 
"(4) of. 
SEC. 
636. 
EXTENSION 
OF 
VETERANS 
PREFERENCE. 
Section 333 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1983) (as amended by section 635(a)) is amended 
by striking paragraph (5) and inserting the following: 
"(5) the application of a person who is a veteran of any 
war, as defined in section 101(12) of title 38, United States 
Code, for a loan under subtitle A or B to be given preference 
over a similar application from a person who is not a veteran 
of any war, if the applications are on file in a county or 
area office at the same time.". 
SEC. 637. VERIFICATION OF THE CREDIT ELSEWHERE TEST. 
Section 333A(f)(4) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1983a(f)(4)) is amended— 
(1) by striking "(4) With" and all that follows through 
"seasoned" and inserting the following: 
"(4) VERIFICATION.— 
"(A) IN GENERAL.—The Secretary shall provide a 
prospectus of a seasoned"; and 
(2) by striking "If the Secretary" and inserting the follow-
ing: 
"(B) NOTIFICATION.—The Secretary shall notify each 
borrower of a loan that a prospectus has been provided 
to a lender under subparagraph (A). 
"(C) CREDIT EXTENDED.—If the Secretary". 
SEC. 638. SALE OF PROPERTY. 
Section 335 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1985) is amended— 
110 STAT. 1094 
PUBLIC LAW 104-127—APR. 4, 1996 
(1) in subsection (b), by striking "subsection (e)" and insert-
ing "subsections (c) and (e)"; 
(2) by striking subsection (c) and inserting the following: 
"(c) SALE OF PROPERTY.— 
"(1) IN GENERAL.—Subject to this subsection and subsection 
(e)(1)(A), the Secretary shall offer to sell real property that 
is acquired by the Secretary under this title using the following 
order and method of sale: 
"(A) ADVERTISEMENT.—Not later than 15 days after 
acquiring real property, the Secretary shall publicly adver-
tise the property for sale. 
"(B) BEGINNING FARMER OR RANCHER.— 
"(i) IN GENERAL.—Not later than 75 days after 
acquiring real property, the Secretary shall offer to 
sell the property to a qualified beginning farmer or 
rancher at current market value based on a current 
appraisal. 
"(ii) RANDOM SELECTION.—If more than 1 qualified 
beginning farmer or rancher offers to purchase the 
property, the Secretary shall select between the quali-
fied applicants on a random basis. 
"(iii) APPEAL OF RANDOM SELECTION.—^A random 
selection or denial by the Secretary of a beginning 
farmer or rancher for farm inventory property under 
this subparagraph shall be final and not administra-
tively appealable. 
"(C) PUBLIC SALE.—If no acceptable offer is received 
from a qualified beginning farmer or rancher under 
subparagraph (B) not later than 75 days after acquiring 
the real property, the Secretary shall, not later than 30 
days after the 75-day period, sell the property after public 
notice at a public sale, and, if no acceptable bid is received, 
by negotiated sale, at the best price obtainable. 
"(2) TRANSITIONAL RULES.— 
"(A) PREVIOUS LEASE.—In the case of real property 
acquired prior to the date of enactment of this subpara-
graph that the Secretary leased prior to the date of enact-
ment of this subparagraph, not later than 60 days after 
the lease expires, the Secretary shall offer to sell the prop-
erty in accordance with paragraph (1). 
"(B) PREVIOUSLY IN INVENTORY.—In the case of real 
property acquired prior to the date of enactment of this 
subparagraph that the Secretary has not leased, not later 
than 60 days after the date of enactment of this subpara-
graph, the Secretary shall offer to sell the property in 
accordance with paragraph (1). 
"(3) INTEREST.— 
"(A) IN GENERAL.—Subject to subparagraph (B), any 
conveyance of real property under this subsection shall 
include all of the interest of the United States in the 
property, including mineral rights. 
"(B) CONSERVATION.—^The Secretary may for conserva-
tion purposes grant or sell an easement, restriction, devel-
opment right, or similar legal right to real property to 
a State, a political subdivision of a State, or a private 
nonprofit organization separately from the underlying fee 
or other rights to the property owned by the United States. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1095 
"(4) OTHER LAW.—The Federal Property and Administrative 
Services Act of 1949 (40 U.S.C. 471 et seq.) shall not apply 
to any exercise of authority under this title. 
"(5) LEASE OF PROPERTY.— 
"(A) IN GENERAL.—Subject to subparagraph (B), the 
Secretary may not lease any real property acquired under 
this title. 
. 
"(B) EXCEPTION.— 
"(i) BEGINNING FARMER OR RANCHER.—The Sec-
retary may lease or contract to sell to a beginning 
farmer or rancher a farm or ranch acquired by the 
Secretary under this title if the beginning farmer or 
rancher qualifies for a credit sale or direct farm owner-
ship loan under subtitle A but credit sale authority 
for loans or direct farm ownership loan funds, respec-
tively, are not available. 
"(ii) TERM.—The term of a lease or contract to 
sell to a beginning farmer or rancher under clause 
(i) shall be until the earlier of— 
"(I) the date that is 18 months after the date 
of the lease or sale; or 
"(II) the date that direct farm ownership loan 
funds or credit sale authority for loans becomes 
available to the beginning farmer or rancher. 
"(iii) INCOME-PRODUCING CAPABILITY.—In deter-
mining the rental rate on real property leased under 
this subparEigraph, the Secretary shall consider the 
income-producing capability of the property during the 
term that the property is leased. 
"(6) EXPEDITED DETERMINATION.— 
"(A) IN GENERAL.—On the request of an applicant, 
not later than 30 days after denial of the applicant's 
application, the appropriate State director shall provide 
an expedited review and determination of whether the 
applicant is a beginning farmer or rancher for the purpose 
of acquiring farm inventory property. 
"(B) APPEAL.—The determination of a State Director 
under subparagraph (A) shall be final and not administra-
tively appealable. 
"(C) EFFECTS OF DETERMINATIONS.— 
"(i) IN GENERAL.—The Secretary shall maintain Records, 
statistical deita on the number and results of deter-
minations made under subparagraph (A) and the effect 
of the determinations on— 
"(I) selling farm inventory property to begin-
ning farmers and ranchers; and 
"(II) disposing of real property in inventory, 
"(ii) NOTIFICATION.—^The Secretary shall notify the 
Committee on Agriculture of the House of Representa-
tives and the Committee on Agriculture, Nutrition, 
and Forestry of the Senate if the Secretary determines 
that the review process under subparagraph (A) is 
adversely affecting the selling of farm inventory prop-
erty to beginning farmers or ranchers or the disposing 
of real property in inventory."; and 
(3) in subsection (e)— 
(A) in paragraph (1)— 
110 STAT. 1096 
PUBLIC LAW 104-127—APR. 4, 1996 
(i) by striking subparagraphs (A) through (C); 
(ii) by redesignating subparagraphs (D) through 
(G) as subparagraphs (A) through (D), respectively; 
(iii) in subparagraph (A) (as redesignated by clause 
(ii))-
(I) in clause (i)— 
(aa) in the matter preceding subclause (I), 
by striking "(G)" and inserting "(D)"; 
(bb) by striking subclause (I) and inserting 
the following: 
"(I) the Secretary acquires property under this title that 
is located within an Indian reservation; and"; 
(cc) in subclause (II), by striking ", and" 
at the end and inserting a semicolon; and 
(dd) by striking subclause (III); and 
(II) in clause (iii), by striking "The Secretary 
shall" and all that follows through "of subpara-
graph (A)," and inserting "Not later than 90 days 
after acquiring the property, the Secretary shall"; 
and 
(iv) in subparagraph (D) (as redesignated by clause 
(ii))-
(I) in clause (i), by striking "(D)" in the matter 
following subclause (IV) and inserting "(A)"; 
(II) in clause (iii)(I), by striking "subpara-
graphs (C)(i), (C)(ii), and (D)" and inserting 
"subparagraph (A)"; and 
(III) by striking clause (v) and inserting the 
following: 
Native 
"(v) FORECLOSURE PROCEDURES.— 
Americans. 
"(I) NOTICE TO BORROWER.—If a n I n d i a n bor-
rower-owner does not voluntarily convey to the 
Secretary real property described in clause (i), not 
less than 30 days before a foreclosure sale of the 
property, the Secretary shall provide the Indian 
borrower-owner with the option of— 
"(aa) requiring the Secretary to assign the 
loan and security instruments to the Secretary 
of the Interior, if the Secretary of the Interior 
agrees to an assignment releasing the Sec-
retary of Agriculture from all further respon-
sibility for collection of any amounts with 
regard to the loan secured by the real property; 
or 
"(bb) requiring the Secretary to assign the 
loan and security instruments to the tribe hav-
ing jurisdiction over the reservation in which 
the real property is located, if the tribe agrees 
to the assignment. 
"(II) NOTICE TO TRIBE.—If an Indian borrower-
owner does not voluntarily convey to the Secretary 
real property described in clause (i), not less than 
30 days before a foreclosure sale of the property, 
the Secretary shall provide written notice to the 
Indian tribe that has jurisdiction over the reserva-
tion in which the real property is located of— 
"(aa) the sale; 
PUBLIC L.\W 104-127—APR. 4, 1996 
110 STAT. 1097 
"(bb) the fair market value of the property; 
and 
"(cc) the requirements of this subpara-
graph. 
"(HI) ASSUMED LOANS.—If an Indian tribe 
assumes a loan under subclause (I)— 
"(aa) the Secretary shall not foreclose the 
loan because of any default that occurred prior 
to the date of the assumption; 
"(bb) the loan shall be for the lesser of 
the outstanding principal and interest of the 
loan or the fair market value of the property; 
and 
"(cc) the loan shall be treated as though 
the loan was made under Public Law 91-229 
(25 U.S.C. 488 et seq.)."; 
(B) by striking paragraph (3); 
(C) in paragraph (4)— 
(i) by striking subparagraph (B); 
(ii) in subparagraph (A)— 
(I) in clause (i), by striking "(i)"; and 
(II) by redesignating clause (ii) as subpara-
graph (B); and 
(iii) in subparagraph (B) (as redesignated by clause 
(ii)(II)), by striking "clause (i)" and inserting "subpara-
graph (A)"; 
(D) by striking paragraphs (5), (6), and (9); and 
(E) by redesignating paragraphs (4), (7), (8), and (10) 
as paragraphs (3), (4), (5), and (6), respectively. 
SEC. 639. EASEMENTS ON INVENTORIED PROPERTY. 
Section 335(g) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1985(g)) is amended— 
(1) in paragraph (1)— 
(A) by striking "(g)(1) Subject to paragraphs (2) through 
(5)" and inserting the following: 
"(g) EASEMENTS ON INVENTORIED PROPERTY.— 
"(1) IN GENERAL.—Subject to paragraph (2)"; and 
(B) by striking ", as determined" and all that follows 
through "3801 et seq.)"; 
(2) by striking paragraph (2) and inserting the following: 
"(2) LIMITATION!—^The Secretary shall not establish a wet-
land conservation easement on an inventoried property that— 
"(A) was cropland on the date the property entered 
the inventory of the Secretary; or 
"(B) was used for farming at any time during the 
period beginning on the date 5 years before the property 
entered the inventory of the Secretary and ending on the 
date the property entered the inventory of the Secretary."; 
(3) by striking paragraphs (3), (4), (5), and (8); 
(4) by striking "(6) The Secretary" and inserting the follow-
ing: 
ing: 
"(3) NOTIFICATION.—The Secretary"; and 
(5) by striking "(7) The appraised" and inserting the follow-
"(4) APPRAISED VALUE.—^The appraised". 
29-194 O - 96 - 36 : QL 3 Part 1 
110 STAT. 1098 
PUBLIC LAW 104-127—APR. 4, 1996 
SEC. 640. DEFINITIONS. 
Section 343(a) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1991(a)) is amended— 
(1) in paragraph (11)— 
(A) in the text preceding subparagraph (A), by striking 
"applicant—" and 
inserting 
"applicant, 
regardless of 
whether the applicant is participating in a program under 
section 3 lOE—"; and 
(B) in subparagraph (F)— 
(i) by striking "15 percent" and inserting "25 per-
cent"; and 
(ii) by inserting before the semicolon at the end 
the following: ", except that this subparagraph shall 
not apply to a loan made or guaranteed under subtitle 
B"; and 
(2) by adding at the end the following: 
"(12) DEBT FORGIVENESS.— 
"(A) IN GENERAL.—Except as provided in subparagraph 
(B), the term 'debt forgiveness' means reducing or terminat-
ing a farmer program loan made or guaranteed under 
this title, in a manner that results in a loss to the Sec-
retary, through— 
"(i) writing down or writing off a loan under section 
353; 
"(ii) compromising, adjusting, reducing, or charg-
ing-off a debt or claim under section 331; 
"(iii) paying a loss on a guaranteed loan under 
section 357; or 
"(iv) discharging a debt as a result of bankruptcy. 
"(B) LOAN RESTRUCTURING.—^The term 'debt forgive-
ness' 
does 
not 
include 
consolidation, 
rescheduling, 
reamortization, or deferral.". 
SEC. 641. AUTHORIZATION FOR LOANS. 
Section 346 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1994) is amended— 
(1) in the second sentence of subsection (a), by striking 
"with or without" and all that follows through "administration"; 
and 
(2) by striking subsection (b) and inserting the following: 
"(b) AUTHORIZATION FOR LOANS.— 
"(1) IN GENERAL.—The Secretary may make or guarantee 
loans under subtitles A and B from the Agricultural Credit 
Insurance Fund provided for in section 309 in not more than 
the following amounts: 
"(A) 
FISCAL 
YEAR 
1996.—For 
fiscal 
year 
1996, 
$3,085,000,000, of which— 
"(i) $585,000,000 shall be for direct loans, of 
which— 
"(I) $85,000,000 shall be for farm ownership 
loans under subtitle A; and 
"(II) $500,000,000 shall be for operating loans 
under subtitle B; and 
"(ii) $2,500,000,000 shall be for guaranteed loans, 
of which— 
"(I) $600,000,000 shall be for guarantees of 
farm ownership loans under subtitle A; and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1099 
"(II) $1,900,000,000 shall be for guarantees 
of operating loans under subtitle B. 
"(B) 
FISCAL 
YEAR 
1997.—For 
fiscal 
year 
1997, 
$3,165,000,000, of which— 
"(i) $585,000,000 shall be for direct loans, of 
which— 
"(I) $85,000,000 shall be for farm ownership 
loans under subtitle A; and 
"(II) $500,000,000 shall be for operating loans 
under subtitle B; and 
"(ii) $2,580,000,000 shall be for guaranteed loans, 
of which— 
"(I) $630,000,000 shall be for guarantees of 
farm ownership loans under subtitle A; and 
"(II) $1,950,000,000 shall be for guarantees 
of operating loans under subtitle B. 
"(C) 
FISCAL 
YEAR 
1998.—For 
fiscal 
year 
1998, 
$3,245,000,000, of which— 
"(i) $585,000,000 shall be for direct loans, of 
which— 
"(I) $85,000,000 shall be for farm ownership 
loans under subtitle A; and 
"(II) $500,000,000 shall be for operating loans 
under subtitle B; and 
"(ii) $2,660,000,000 shall be for guaranteed loans, 
of which— 
"(I) $660,000,000 shall be for guarantees of 
farm ownership loans under subtitle A; and 
"(II) $2,000,000,000 shall be for guarantees 
of operating loans under subtitle B. 
"(D) 
FISCAL 
YEAR 
1999.—For 
fiscal 
year 
1999, 
$3,325,000,000, of which— 
"(i) $585,000,000 shall be for direct loans, of 
which— 
"(I) $85,000,000 shall be for farm ownership 
loans under subtitle A; and 
"(II) $500,000,000 shall be for operating loans 
under subtitle B; and 
"(ii) $2,740,000,000 shall be for guaranteed loans, 
of which— 
"(I) $690,000,000 shall be for guarantees of 
farm ownership loans under subtitle A; and 
"(II) $2,050,000,000 shall be for guarantees 
of operating loans under subtitle B. 
"(E) 
FISCAL 
YEAR 
2000.—For 
fiscal 
year 
2000, 
$3,435,000,000, of which— 
"(i) $585,000,000 shall be for direct loans, of 
which— 
"(I) $85,000,000 shall be for farm ownership 
loans under subtitle A; and 
"(II) $500,000,000 shall be for operating loans 
under subtitle B; and 
"(ii) $2,850,000,000 shall be for guaranteed loans, 
of which— 
"(I) $750,000,000 shall be for guarantees of 
farm ownership loans under subtitle A; and 
110 STAT. 1100 
PUBLIC LAW 104-127—APR. 4, 1996 
"(II) $2,100,000,000 shall be for guarantees" 
of operating loans under subtitle B. 
"(F) 
FISCAL 
YEAR 
2001.—For 
fiscal 
year 
2001, 
$3,435,000,000, of which— 
"(i) $585,000,000 shall be for direct loans, of 
which— 
"(I) $85,000,000 shall be for farm ownership 
loans under subtitle A; and 
"(II) $500,000,000 shall be for operating loans 
under subtitle B; and 
"(ii) $2,850,000,000 shall be for guaranteed loans, 
of which— 
"(I) $750,000,000 shall be for guarantees of 
farm ownership loans under subtitle A; and 
"(II) $2,100,000,000 shall be for guarantees 
of operating loans under subtitle B. 
"(G) 
FISCAL 
YEAR 
2002.—For 
fiscal 
year 
2002, 
$3,435,000,000, of which— 
"(i) $585,000,000 shall be for direct loans, of 
which— 
"(I) $85,000,000 shall be for farm ownership 
loans under subtitle A; and 
"(II) $500,000,000 shall be for operating loans 
under subtitle B; and 
"(ii) $2,850,000,000 shall be for guaranteed loans, 
of which— 
"(I) $750,000,000 shall be for guarantees of 
farm ownership loans under subtitle A; and 
"(II) $2,100,000,000 shall be for guarantees 
of operating loans under subtitle B. 
"(2) BEGINNING FARMERS AND RANCHERS.— 
"(A) DIRECT LOANS.— 
"(i) FARM OWNERSHIP LOANS.— 
"(I) IN GENERAL.—Of the amounts made avail-
able under paragraph (1) for direct farm ownership 
loans, the Secretary shall reserve 70 percent for 
qualified beginning farmers and ranchers. 
"(II) DOWN PAYMENT LOANS.—Of the amounts 
reserved for a fiscal year under subclause (I), the 
Secretary shall reserve 60 percent for the down 
payment loan program under section 310E until 
April 1 of the fiscal year. 
"(ii) OPERATING LOANS.—Of the amounts made 
available under paragraph (1) for direct operating 
loans, the Secretary shall reserve for qualified begin-
ning farmers and ranchers— 
"(I) for each of fiscal years 1996 through 1998, 
25 percent; 
"(II) for fiscal year 1999, 30 percent; and 
"(III) for each of fiscal years 2000 through 
2002, 35 percent. 
"(iii) 
FUNDS 
RESERVED UNTIL SEPTEMBER 1.— 
Except as provided in clause (i)(II), funds reserved 
for qualified beginning farmers or ranchers under this 
subparagraph for a fiscal year shall be reserved only 
until September 1 of the fiscal year. 
"(B) GUARANTEED LOANS.— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1101 
"(i) FARM OWNERSHIP LOANS.—Of the amounts 
made available under paragraph (1) for guarantees 
of farm ownership loans, the Secretary shall reserve 
25 percent for qualified beginning farmers and ranch-
ers. 
"(ii) OPERATING LOANS.—Of the amounts made 
available under paragraph (1) for guarantees of operat-
ing loans, the Secretary shall reserve 40 percent for 
qualified beginning farmers and ranchers. 
"(iii) FUNDS 
RESERVED 
UNTIL APRIL i.—Funds 
reserved for qualified beginning farmers or ranchers 
under this subparagraph for a fiscal year shall be 
reserved only until April 1 of the fiscal year. 
"(C) RESERVED FUNDS FOR ALL QUALIFIED BEGINNING 
FARMERS AND RANCHERS.—If a qualified beginning farmer 
or rancher meets the eligibility criteria for receiving a 
direct or guaranteed loan under section 302, 310E, or 311, 
the Secretary shall make or guarantee the loan if sufficient 
funds reserved under this paragraph are available to make 
or guarantee the loan. 
"(3) TRANSFER FOR DOWN PAYMENT LOANS.— 
"(A) IN GENERAL.—^Notwithstanding subsection (a), sub-
ject to subparagraph (B)— 
"(i) beginning on August 1 of each fiscal year, 
the Secretary shall use available unsubsidized guaran-
teed farm operating loan funds to provide direct farm 
ownership loans approved by the Secretary to qualified 
beginning farmers and ranchers under the down pay-
ment loan program established under section 310E, 
if sufficient direct farm ownership loan funds are not 
otherwise available; and 
"(ii) beginning on September 1 of each fiscal year, Effective date, 
the Secretary shall use available unsubsidized guaran-
teed farm operating loan funds to provide direct farm 
ownership loans approved by the Secretary to qualified 
beginning farmers and ranchers, if sufficient direct 
farm ownership loan funds are not otherwise available. 
"(B) LIMITATION.—^The Secretary shall limit the trans-
fer of funds under subparagraph (A) so that all guaranteed 
farm operating loans that have been approved, or will 
be approved, by the Secretary during the fiscal year will 
be made to the extent of available amounts. 
"(4) TRANSFER FOR CREDIT SALES OF FARM INVENTORY PROP-
ERTY.— 
"(A) IN GENERAL.—^Notwithstanding subsection (a), sub-
ject to subparagraphs (B) and (C), beginning on September 
1 of each fiscal year, the Secretary may use available 
funds made available under subtitle C for the fiscal year 
to fund the credit sale of farm real estate in the inventory 
of the Secretary. 
"(B) 
SUPPLEMENTAL APPROPRIATIONS.—^The 
transfer 
authority provided under subparagraph (A) shall not apply 
to any funds made available to the Secretary for any fiscal 
year under an Act making supplemental appropriations. 
"(C) LIMITATION.—^The Secretary shall limit the trans-
fer of funds under subparagraph (A) so that all emergency 
disaster loans that have been approved, or will be approved, 
110 STAT. 1102 
PUBLIC LAW 104-127—APR. 4, 1996 
by the Secretary during the fiscal year will be made to 
the extent of available amounts.". 
SEC. 642. CONTRACTS ON LOAN SECURITY PROPERTIES. 
Section 349 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1997) is amended— 
(1) by striking subsection (b) and inserting the following: 
"(b) CONTRACTS ON LOAN SECURITY PROPERTIES.—Subject to 
subsection (c), the Secretary may enter into a contract related 
to real property for conservation, recreation, or wildlife purposes."; 
(2) in subsection (c)— 
(A) by striking "(c) Such easement" and all that follows 
through "if—" and inserting the following: 
"(c) LIMITATIONS.—The Secretary may enter into a contract 
under subsection (b) if—"; 
(B) in paragraph (2), by adding "and" at the end; 
(C) in paragraph (3)— 
(i) by striking subparagraph (B); 
(ii) by striking "(3)(A)(i)" and inserting "(3)(A)"; 
(iii) by striking "Farmers Home Administration" 
and inserting "Secretary"; 
(iv) by striking "(ii) such easement" and inserting 
"(B) such contract"; and 
(v) by striking "; or" and inserting a period; and 
(D) by striking paragraph (4); 
(3) in subsection (d), by striking "easement" each place 
it appears and inserting "contract"; 
(4) in subsection (e)— 
(A) in paragraph (1)— 
(i) in the matter preceding subparagraph (A), by 
striking "purchase any such easement from the bor-
rower—" and inserting "reduce or forgive the outstand-
ing debt of a borrower—"; 
(ii) by striking "easement" each place it appears 
and inserting "contract"; and 
(iii) by striking "Farmers Home Administration" 
each place it appears and inserting "Secretary"; and 
(B) in paragraph (2)(A), by striking "easement is 
acquired" and inserting "contract is entered into"; 
(5) in subsection (f)— 
(A) in paragraph (1), by striking "acquire easements" 
and inserting "enter into contracts"; and 
(B) in paragraphs (2) and (3), by striking "easements" 
each place it appears and inserting "contracts"; and 
(6) in subsection (g), by striking "an easement acquired" 
and inserting "a contract entered into". 
SEC. 643. LIST OF CERTIFIED LENDERS AND INVENTORY PROPERTY 
DEMONSTRATION PROJECT. 
(a) IN GENERAL.—Section 351 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1999) is amended— 
(1) in subsection (f)— 
(A) by striking "Each Farmers Home Administration 
county supervisor" and inserting "The Secretary"; 
(B) by striking "approved lenders" and inserting "lend-
ers"; and 
(C) by striking "the Farmers Home Administration"; 
and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1103 
(2) by striking subsection (h). 
(b) TECHNICAL AMENDMENT.—Section 1320 of the Food Security 
Act of 1985 (Public Law 99-198; 7 U.S.C. 1999 note) is amended 
by striking "Effective only" and all that follows through "1995, 
the" and inserting "The". 
SEC. 644. HOMESTEAD PROPERTY. 
Section 352(c) of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 2000(c)) is amended— 
(1) in paragraph (1)(A), by striking "90" each place it 
appears and inserting "30"; and 
(2) in paragraph (6)— 
(A) in the first sentence, by striking "Within 30" and 
all that follows through "title," and insert "Not later than 
the date of acquisition of the property securing a loan 
made under this title (or, in the case of real property 
in inventory on the date of enactment of the Federal Agri-
culture Improvement and Reform Act of 1996, not later 
than 5 days after the date of enactment of the Act),"; 
and 
(B) by striking the second sentence. 
SEC. 645. RESTRUCTURING. 
Section 353 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 2001) is amended— 
(1) in subsection (c)— 
(A) in paragraph (3), by striking subparagraph (C) 
and inserting the following: 
"(C) CASH FLOW MARGIN.—For the purpose of assessing 
under subparagraph (A) the ability of a borrower to meet 
debt obligations and continue farming operations, the Sec-
retary shall assume that the borrower needs up to 110 
percent of the amount indicated for pajrment of farm operat-
ing expenses, debt service obligations, and family living 
expenses."; and 
(B) by striking paragraph (6) and inserting the follow-
ing: 
"(6) TERMINATION OF LOAN OBLIGATIONS.—The obligations 
of a borrower to the Secretary under a loan shall terminate 
if— 
"(A) the borrower satisfies the requirements of para-
graphs (1) and (2) of subsection (b); 
"(B) the value of the restructured loan is less than 
the recovery value; and 
"(C) not later than 90 days after receipt of the notifica-
tion described in paragraph (4)(B), the borrower pays (or 
obtains third-party financing to pay) the Secretary an 
amount equal to the current market value."; 
(2) by striking subsection (k); and 
(3) by redesignating subsections (1) through (p) as sub-
sections (k) through (o), respectively. 
SEC. 646. TRANSFER OF INVENTORY LAND FOR CONSERVATION PUR-
POSES. 
Section 354 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 2002) is amended— 
(1) in the matter preceding paragraph (1), by striking "The 
Secretary, without reimbursement," and inserting the following: 
110 STAT. 1104 
PUBLIC LAW 104-127—APR. 4, 1996 
"(a) IN GENERAL.—Subject to subsection (b), the Secretary"; 
(2) by striking paragraph (2) and inserting the following: 
"(2) that is eligible to be disposed of in accordance with 
section 335; and"; and 
(3) by adding at the end the following: 
"(b) CONDITIONS.—The Secretary may not transfer any property 
or interest in property under subsection (a) unless— 
"(1) at least 2 public notices are given of the transfer; 
"(2) if requested, at least 1 public meeting is held prior 
to the transfer; and 
"(3) the Governor and at least 1 elected county official 
of the State and county where the property is located are 
consulted prior to the transfer.". 
SEC. 647. IMPLEMENTATION OF TARGET PARTICIPATION RATES. 
Section 355 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 2003) is amended by adding at the end the following: 
"(f) IMPLEMENTATION CONSISTENT WITH SUPREME COURT HOLD-
ING.—^Not later than 180 days after the date of enactment of this 
subsection, the Secretary shall ensure that the implementation 
of this section is consistent with the holding of the Supreme Court 
in Adarand Constructors, Inc. v. Federico Pena, Secretary of 
Transportation, 115 S. Ct. 2097 (1995).". 
SEC. 648. DELINQUENT BORROWERS. 
(a) PAYMENT OF INTEREST AS A CONDITION OF LOAN SERVICING 
FOR BORROWERS.—The Consolidated Farm and Rural Development 
Act (7 U.S.C. 1921 et seq.) is amended by adding at the end 
the following: 
7 u s e 2008g. 
"SEC. 372. PAYMENT OF INTEREST AS A CONDITION OF LOAN SERVIC-
ING FOR BORROWERS. 
"The Secretary may not reschedule or reamortize a loan for 
a borrower under this title who has not requested consideration 
under section 331D(e) unless the borrower pays a portion, as deter-
mined by the Secretary, of the interest due on the loan.". 
(b) LOAN AND LOAN SERVICING LIMITATIONS.—The Consolidated 
Farm and Rural Development Act (7 U.S.C. 1921 et seq.) (as amend-
ed by subsection (a)) is amended by adding at the end the following: 
7 u s e 2008h. 
"SEC. 373. LOAN AND LOAN SERVICING LIMITATIONS. 
"(a) DELINQUENT BORROWERS PROHIBITED FROM OBTAINING 
DIRECT OPERATING LOANS.—^The Secretary may not make a direct 
operating loan under subtitle B to a borrower who is delinquent 
on any loan made or guaranteed under this title. 
"(b) LOANS PROHIBITED FOR BORROWERS THAT HAVE RECEIVED 
DEBT FORGIVENESS.— 
"(1) IN GENERAL.—Except as provided in paragraph (2), 
the Secretary may not make or guarantee a loan under this 
title to a borrower who received debt forgiveness on a loan 
made or guaranteed under this title. 
"(2) EXCEPTION.—The Secretary may make a direct or 
guaranteed farm operating loan for paying annual farm or 
ranch operating expenses of a borrower who was restructured 
with a write-down under section 353. 
"(c) No MORE THAN 1 DEBT FORGIVENESS FOR A BORROWER 
ON A DIRECT LOAN.—^The Secretary may not provide to a borrower 
debt forgiveness on a direct loan made under this title if the 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1105 
borrower has received debt forgiveness on another direct loan made 
under this title.". 
SEC. 649. SHORT FORM CERTIFICATION OF FARM PROGRAM BOR-
ROWER COMPLIANCE. 
The Consolidated Farm and Rural Development Act (7 U.S.C. 
1921 et seq.) (as amended by section 648) is amended by adding 
at the end the following: 
"SEC. 374. SHORT FORM CERTIFICATION OF FARM PROGRAM BOR- 
7 USC 20081. 
ROWER COMPLIANCE. 
"The Secretary shall develop and utilize a consolidated short 
form for farm program borrowers to use in certifying compliance 
with any applicable provision of law (including a regulation) that 
serves as an eligibility prerequisite for a loan made under this 
title.". 
SEC. 650. CREDIT STUDY. 
7 USC 2001 note. 
(a) IN GENERAL.—The Secretary of Agriculture shall conduct Reports. 
a study and report to the Committee on Agriculture of the House 
of Representatives and the Committee on Agriculture, Nutrition, 
and Forestry of the Senate on the demand for and availability 
of credit in rural areas for agriculture, housing, and rural develop-
ment. 
(b) PURPOSE.—The purpose of the study shall be to ensure 
that Congress has current and comprehensive information to con-
sider as Congress deliberates on rural credit needs and the availabil-
ity of credit to satisfy the needs of rural areas of the United 
States. 
(c) ITEMS IN STUDY.—In conducting the study, the Secretary 
shall Ijase the study on the most current available data and ana-
lyze— 
(1) rural demand for credit from the Farm Credit System, 
the ability of the Farm Credit System to meet the demand, 
and the extent to which the Farm Credit System provides 
loans to satisfy the demand; 
(2) rural demand for credit from the United States banking 
system, the ability of banks to meet the demand, and the 
extent to which banks provide loans to satisfy the demand; 
(3) rural demand for credit from the Secretary, the ability 
of the Secretary to meet the demand, and the extent to which 
the Secretary provides loans to satisfy the demand; 
(4) rural demand for credit from other Federal agencies, 
the ability of the agencies to meet the demand, and the extent 
to which the agencies provide loans to satisfy the demand; 
(5) what measure or measures exist to gauge the overall 
demand for rural credit, the extent to which rural demand 
for credit is satisfied, and what the measures have dem-
onstrated; 
(6) a comparison of the interest rates and terms charged 
by the Farm Credit System Farm Credit Banks, production 
credit associations, and banks for cooperatives with the rates 
and terms charged by the banks of the United States for credit 
of comparable risk and maturity; 
(7) the advantages and disadvantages of the modernization 
and expansion proposals of the Farm Credit System on the 
Farm Credit System, the United States banking system, rural 
110 STAT. 1106 
PUBLIC LAW 104-127—APR. 4, 1996 
users of credit, local rural communities, and the Federal 
Government, including— 
(A) any added risk to the safety and soundness of 
the Farm Credit System that may result from approval 
of a proposal; and 
(B) any positive or adverse impacts on competition 
between the Farm Credit System and the banks of the 
United States in providing credit to rural users; 
(8) the nature and extent of the unsatisfied rural credit 
need that the Farm Credit System proposals are supposed 
to address and what aspects of the present Farm Credit System 
prevent the Farm Credit System from meeting the need; 
(9) the advantages and disadvantages of the proposal by 
commercial bankers to allow banks access to the Farm Credit 
System as a funding source on the Farm Credit System, the 
United States banking system, rural users of credit, local rural 
communities, and the Federal Government, including— 
(A) any added risk to the safety and soundness of 
the Farm Credit System that may result from approval 
of the proposal; and 
(B) any positive or adverse impacts on competition 
between the Farm Credit System and the banks of the 
United States in providing credit to rural users; and 
(10) problems that commercial banks have in obtaining 
capital for lending in rural areas, how access to Farm Credit 
System funds would improve the availability of capital in rural 
areas in ways that cannot be achieved in the system in existence 
on the date of enactment of this Act, and the possible effects 
on the viability of the Farm Credit System of granting banks 
access to Farm Credit System funds. 
(d) INTERAGENCY TASK FORCE.—In completing the study, the 
Secretary shall use, among other things, data and information 
obtained by the interagency task force on rural credit. 
Subtitle E—General Provisions 
SEC. 661. CONFORMING AMENDMENTS. 
(a) Section 307(a) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1927(a)) is amended— 
(1) in paragraph (4), by striking "304(b), 306(a)(1), and 
310B" and inserting "306(a)(1) and 310B"; and 
(2) in paragraph (6)(B)— 
(A) by striking clauses (i), (ii), (iv), and (vii); 
(B) in clause (v), by adding "and" at the end; 
(C) in clause (vi), by striking ", and" at the end and 
inserting a period; and 
(D) by redesignating clauses (iii), (v), and (vi) as clauses 
(i), (ii), and (iii), respectively. 
(b) The second sentence of section 309(g)(1) of the Consolidated 
Farm and Rural Development Act (7 U.S.C. 1929(g)(1)) is amended 
by striking "section 308,". 
(c) Section 309A of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1929a) is amended— 
(1) in the second sentence of subsection (a), by striking 
"304(b), 306(a)(1), 306(a)(14), 310B, and 312(b)" and inserting 
"306(a)(1), 306(a)(14), and 310B"; and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1107 
(2) in the first sentence of subsection (b), by striking "and 
section 308". 
(d) Section 310B(d) of the ConsoUdated Farm and Rural Devel-
opment Act (7 U.S.C. 1932(d)) is amended— 
(1) by striking "sections 304(b), 310B, and 312(b)" each 
place it appears in paragraphs (2), (3), and (4) and inserting 
"this section"; and 
(2) in paragraph (6), by striking "this section, section 304, 
or section 312" and inserting "this section". 
(e) The first sentence of section 310D(a) of the Consolidated 
Farm and Rural Development Act (7 U.S.C. 1934(a)) is amended 
by striking "paragraphs (1) through (5) of section 303(a), or subpara-
graphs (A) through (E) of section 304(a)(1)" and inserting "section 
303(a), or paragraphs (1) through (5) of section 304(a)". 
(f) Section 311(b)(1) of the Consolidated Farm and Rural Devel-
opment Act (7 U.S.C. 1941(b)(1)) is amended by striking "and for 
the purposes specified in section 312". 
(g) Section 316(a) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1946(a)) is amended by striking paragraph 
(3). 
(h) Section 343 of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1991) is amended— 
(1) in subsection (a)(10), by striking "recreation loan (RL) 
under section 304,"; and 
(2) in subsection (b)— 
(A) in the matter preceding paragraph (1), by striking 
"351(h),"; and 
(B) by striking paragraph (4) and inserting the follow-
ing: 
"(4) PRESERVATION LOAN SERVICE PROGRAM.—The term 
'preservation loan service program' means homestead retention 
as authorized under section 352.". 
(i) The first sentence of section 344 of the Consolidated Farm 
and Rural Development Act (7 U.S.C. 1992) is amended by striking 
"304(b), 306(a)(1), 310B, 312(b), or 312(c)" and inserting "306(a)(1), 
310B, or 312(c)". 
(j) Section 353(1) of the Consolidated Farm and Rural Develop-
ment Act (as redesignated by section 645(3)) is amended by striking 
"and subparagraphs (A)(i) and (C)(i) of section 335(e)(1),". 
SEC. 662. ELECTRONIC FILING OF EFFECTIVE FINANCING STATE-
MENTS UNDER THE CLEAR TITLE PROVISIONS OF THE 
FOOD SECURITY ACT OF 1985. 
Section 1324(c)(4) of the Food Security Act of 1985 (7 U.S.C. 
1631(c)(4)) is amended—-
(1) in subparagraph (A), by striking "thereof and inserting 
"of the statement, or, in the case of a State which (under 
the applicable State law provisions of the Uniform Commercial 
Code) allows the electronic filing of financing statements with-
out the signature of the debtor, is an electronically reproduced 
copy of the statement"; and 
(2) in each of subparagraphs (B) and (C), by inserting 
"other than in the case of an electronically reproduced copy 
of the statement," before "is". 
110 STAT. 1108 
PUBLIC LAW 104-127—APR. 4, 1996 
7 u s e 1922 note. 
SEC. 663. EFFECTIVE DATE. 
(a) IN GENERAL.—Except as provided in subsection (b), the 
amendments made by this title shall become effective on the date 
of enactment of this Act. 
(b) DELAYED EFFECTIVE DATES.—^The amendments made by 
sections 601, 606, 611, 612, 622, 623, 625, 633, 640(1), 642, 645(1), 
648(a), and 649 shall become effective 90 days after the date of 
enactment of this Act. 
(c) TRANSITION PROVISION.—^The amendments made by sections 
638 and 644 shall not apply with respect to a complete application 
to acquire inventory property submitted prior to the date of enact-
ment of this Act. 
(d) REGULATIONS.—Notwithstanding any other provision of law, 
regulations to implement the amendments made by this title shall 
be published as interim final rules with request for comments 
and may be made effective immediately on publication. 
TITLE VII—RURAL DEVELOPMENT 
Subtitle A—^Amendments to the Food, Agri-
culture, Conservation, and Trade Act of 
1990 
CHAPTER 
1—GENERAL 
PROVISIONS 
SEC. 701. RURAL INVESTMENT PARTNERSHIPS. 
Subtitle B of title XXIII of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 2007 et seq.) is repealed. 
SEC. 702. WATER AND WASTE FACILITY FINANCING. 
Section 2322 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 1926-1) is repealed. 
SEC. 703. RURAL WASTEWATER CIRCUIT RIDER PROGRAM. 
Section 2324 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (Public Law 101-624; 7 U.S.C. 1926 note) is repealed. 
SEC. 704. TELEMEDICINE AND DISTANCE LEARNING SERVICES IN 
RURAL AREAS. 
Chapter 1 of subtitle D of title XXIII of the Food, Agriculture, 
Conservation, and Trade Act of 1990 (7 U.S.C. 950aaa et seq.) 
is amended to read as follows: 
"CHAPTER 1—TELEMEDICINE AND DISTANCE 
LEARNING SERVICES IN RURAL AREAS 
7 u s e 950aaa. 
"SEC. 2331. PURPOSE. 
"The purpose of this chapter is to encourage and improve 
telemedicine services and distance learning services in rural areas 
through the use of telecommunications, computer networks, and 
related advanced technologies by students, teachers, medical profes-
sionals, and rural residents. 
7 u s e 950aaa-l. 
"SEC. 2332. DEFINITIONS. 
"In this chapter: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1109 
"(1) CONSTRUCT.—^The term 'construct' means to construct, 
acquire, install, improve, or extend a facility or system. 
"(2) COST OF MONEY LOAN.—The term 'cost of money loan' 
means a loan made under this chapter bearing interest at 
a rate equal to the then current cost to the Federal Government 
of loans of similar maturity. 
"(3) SECRETARY.—The term 'Secretary' means the Secretary 
of Agriculture. 
"SEC. 2333. TELEMEDICINE AND DISTANCE LEARNING SERVICES IN 7 USC 950aaa-2. 
RURAL AREAS. 
"(a) SERVICES TO RURAL AREAS.—The Secretary may provide 
financial assistance for the purpose of financing the construction 
of facilities and systems to provide telemedicine services and dis-
tance learning services in rural areas. 
"(b) FINANCIAL ASSISTANCE.— 
"(1) IN GENERAL.—Financial assistance shall consist of 
grants or cost of money loans, or both. 
"(2) FORM.—The Secretary shall determine the portion of 
the financial assistance provided to a recipient that consists 
of grants and the portion that consists of cost of money loans 
so as to result in the maximum feasible repayment to the 
Federal Government of the financial assistance, based on the 
ability to repay of the recipient and full utilization of funds 
made available to carry out this chapter. 
"(c) RECIPIENTS.— 
"(1) IN GENERAL.—The Secretary may provide financial 
assistance under this chapter to— 
"(A) entities using telemedicine services or distance 
learning services; and 
"(B) entities 
providing or proposing to provide 
telemedicine service or distance learning service to other 
persons at rates calculated to ensure that the benefit of 
the financial assistance is passed through to the other 
persons. 
"(2) ELECTRIC OR TELECOMMUNICATIONS BORROWERS.— 
"(A) LOANS TO BORROWERS.—Subject to subparagraph 
(B), the Secretary may provide a cost of money loan under 
this chapter to a borrower of an electric or telecommuni-
cations loan under the Rural Electrification Act of 1936 
(7 U.S.C. 901 et seq.). A borrower receiving a cost of money 
loan under this paragraph shall— 
"(i) make the funds provided available to entities 
that qualify under paragraph (1) for projects satisfying 
the requirements of this chapter; 
"(ii) use the funds provided to acquire, install, 
improve, or extend a system referred to in subsection 
(a); or 
"(iii) use the funds provided to install, improve, 
or extend a facility referred to in subsection (a). 
"(B) LIMITATIONS.—^A borrower of an electric or tele-
communications loan under the Rural Electrification Act 
of 1936 shall— 
"(i) make a system or facility funded 
under 
subparagraph (A) available to entities that qualify 
under paragraph (1); and 
110 STAT. 1110 
PUBLIC LAW 104-127—APR. 4, 1996 
"(ii) neither retain from the proceeds of a loan 
provided under subparagraph (A), nor assess a qualify-
ing entity under paragraph (1), any amount except 
as may be required to pay the actual costs incurred 
in administering the loan or making the system or 
facility available. 
"(3) APPEAL.—If the Secretary rejects the application of 
a borrower who applies for a cost of money loan or grant 
under this section, the borrower may appeal the decision to 
the Secretary not later than 10 days after the borrower is 
notified of the rejection. 
"(4) ASSISTANCE TO PROVIDE OR IMPROVE SERVICES.—Finan-
cial assistance may be provided under this chapter for a facility 
regardless of the location of the facility if the Secretary deter-
mines that the assistance is necessary to provide or improve 
telemedicine services or distance learning services in a rural 
area. 
"(d) PRIORITY.—^The Secretary shall establish procedures to 
prioritize financial assistance under this chapter considering— 
"(1) the need for the assistance in the affected rural area; 
"(2) the financial need of the applicant; 
"(3) the population sparsity of the affected rural area; 
"(4) the local involvement in the project serving the affected 
rural area; 
"(5) geographic diversity among the recipients of financial 
assistance; 
"(6) the utilization of the telecommunications facilities of 
any telecommunications provider serving the affected rural 
area; 
"(7) the portion of total project financing provided by the 
applicant from the funds of the applicant; 
"(8) the portion of project financing provided by the 
applicant with funds obtained from non-Federal sources; 
"(9) the joint utilization of facilities financed by other finan-
cial assistance; 
"(10) the coordination of the proposed project with regional 
projects or networks; 
"(11) service to the greatest practical number of persons 
within the general geographic area covered by the financial 
assistance; 
"(12) conformity with the State strategic plan as prepared 
under section 38 ID of the Consolidated Farm and Rural Devel-
opment Act; and 
"(13) other factors determined appropriate by the Secretary. 
Federal Register, 
"(e) MAXIMUM AMOUNT OF ASSISTANCE TO INDIVIDUAL R E C I P I -
publication. 
ENTS.—The Secretary may establish the maximum amount of finan-
cial assistance to be made available to an individual recipient 
for each fiscal year under this chapter, by publishing notice of 
the maximum amount in the Federal Register not more than 45 
days after funds are made available for the fiscal year to carry 
out this chapter. 
"(f) USE OF FUNDS.—^Financial assistance provided under this 
chapter shall be used for— 
"(1) the development and acquisition of instructional 
programming; 
"(2) the development and acquisition, through lease or pur-
chase, of computer hardware and software, audio and visual 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1111 
equipment, computer network components, telecommunications 
terminal equipment, telecommunications transmission facili-
ties, data terminal equipment, or interactive video equipment, 
or other facilities that would further telemedicine services or 
distance learning services; 
"(3) providing technical assistance and instruction for the 
development or use of the programming, equipment, or facilities 
referred to in paragraphs (1) and (2); or 
"(4) other uses that are consistent with this chapter, as 
determined by the Secretary. 
"(g) SALARIES AND EXPENSES.—Notwithstanding subsection (f), 
financial assistance provided under this chapter shall not be used 
for paying salaries or administrative expenses. 
"(h) EXPEDITING COORDINATED TELEPHONE LOANS.— 
"(1) IN GENERAL.—^The Secretary may establish and carry 
out procedures to ensure that expedited consideration and 
determination is given to applications for loans and advances 
of funds submitted by local exchange carriers under this chapter 
and the Rural Electrification Act of 1936 (7 U.S.C. 901 et 
seq.) to enable the exchange carriers to provide advanced tele-
communications services in rural areas in conjunction with 
any other projects carried out under this chapter. 
"(2) DEADLINE IMPOSED ON SECRETARY.—Not later than 
45 days after the receipt of a completed application for an 
expedited telephone loan under paragraph (1), the Secretary 
shall notify the applicant in writing of the decision of the 
Secretary regarding the application. 
"(i) NOTIFICATION OF LOCAL EXCHANGE CARRIER.— 
"(1) APPLICANTS.—Each applicant for a grant for a 
telemedicine or distance learning project established under this 
chapter shall notify the appropriate local telephone exchange 
carrier regarding the application filed with the Secretary for 
the grant. 
"(2) SECRETARY.—The Secretary shall— 
"(A) publish notice of applications received for grants 
under this chapter for telemedicine or distance learning 
projects; and 
"(B) make the applications available for inspection. 
"SEC. 2334. ADMINISTRATION. 
"(a) NONDUPLICATION.—The Secretary shall ensure that facili-
ties constructed using financial assistance provided under this chap-
ter do not duplicate adequate established telemedicine services 
or distance learning services. 
"(b) LOAN MATURITY.—^The maturities of cost of money loans 
shall be determined by the Secretary, based on the useful life 
of the facility being financed, except that the loan shall not be 
for a period of more than 10 years. 
"(c) LOAN SECURITY AND FEASIBILITY.—The Secretary shall 
make a cost of money loan only if the Secretary determines that 
the security for the loan is reasonably adequate and that the 
loan will be repaid within the period of the loan. 
"(d) ENCOURAGING CONSORTIA.—The Secretary shall encourage 
the development of consortia to provide telemedicine services or 
distance learning services through telecommunications in rural 
areas served by a telecommunications provider. 
Notification. 
7 use 950aaa-3. 
110 STAT. 1112 
PUBLIC LAW 104-127—APR. 4, 1996 
"(e) 
COORDINATION WITH OTHER AGENCIES.—The Secretary 
shall coordinate, to the extent practicable, with other Federal and 
State agencies with similar grant or loan programs to pool resources 
for funding meritorious proposals in rural areas. 
"(f) INFORMATIONAL EFFORTS.—The Secretary shall establish 
and implement procedures to carry out informational efforts to 
advise potential end users located in rural areas of each State 
about the program authorized by this chapter. 
7 u s e 950aaa-4. 
«SEC. 2335. REGULATIONS. 
7 u s e 950aaa-5. 
7 u s e 1932. 
13 u s e 142 note. 
15 u s e 714 note. 
"Not later than 180 days after the date of enactment of the 
Federal Agriculture Improvement and Reform Act of 1996, the 
Secretary shall issue regulations to carry out this chapter. 
"SEC. 2335A. AUTHORIZATION OF APPROPRIATIONS. 
"There are authorized to be appropriated to carry out this 
chapter $100,000,000 for each of fiscal years 1996 through 2002.". 
SEC. 705. L I M I T A T I O N ON AUTHORIZATION OF APPROPRIATIONS FOR 
RURAL TECHNOLOGY GRANTS. 
Section 2347 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (Public Law 101-624; 104 Stat. 4034) is amended— 
(1) by striking "(a) IN GENERAL.—"; and 
(2) by striking subsection (b). 
SEC. 706. DEMONSTRATION PROJECTS. 
Section 2348 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 2662a) is repealed. 
SEC. 707. MONITORING THE ECONOMIC PROGRESS OF RURAL AMER-
ICA. 
Section 2382 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (Pubhc Law 101-624; 13 U.S.C. 141 note) is repealed. 
SEC. 708. ANALYSIS BY OFFICE OF TECHNOLOGY ASSESSMENT. 
Section 2385 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (Public Law 101-624; 7 U.S.C. 950aaa-4 note) is 
repealed. 
SEC. 709. RURAL HEALTH INFRASTRUCTURE IMPROVEMENT. 
Section 2391 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (Public Law 101-624; 7 U.S.C. 2662 note) is repealed. 
SEC. 710. CENSUS OF AGRICULTURE. 
Section 2392 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (Public Law 101-624; 104 Stat. 4057) is repealed. 
SEC. 711. STUDY OF THE TRANSPORTATION OF FERTILIZER AND AGRI-
CULTURAL CHEMICALS TO FARMERS. 
Section 2517 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (Public Law 101-624; 104 Stat. 4077) is repealed. 
CHAPTER 2—ALTERNATIVE AGRICULTURAL RESEARCH 
AND COMMERCIALIZATION 
SEC. 721. DEFINITIONS. 
Section 1657(c) of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (7 U.S.C. 5901(c)) is amended— 
(1) by striking paragraphs (3) and (4); 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1113 
(2) by redesignating paragraph (5) as paragraph (3); 
(3) by redesignating paragraphs (6) through (12) as para-
graphs (7) through (13), respectively; and 
(4) by inserting after paragraph (3) (as redesignated by 
paragraph (2)) the following: 
"(4) CORPORATE BOARD.—^The term 'Corporate Board' means 
the Board of Directors of the Corporation described in section 
1659. 
"(5) CORPORATION.—^The term 'Corporation' means the 
Alternative Agricultural Research and Commercialization Cor-
poration established under section 1658. 
"(6) EXECUTIVE DIRECTOR.—The term 'Executive Director' 
means the Executive Director of the Corporation appointed 
under section 1659(e).". 
SEC. 722. ALTERNATIVE AGRICULTURAL RESEARCH AND COMMER-
CIALIZATION CORPORATION, 
(a) IN GENERAL.—Section 1658 of the Food, Agriculture, Con-
servation, and Trade Act of 1990 (7 U.S.C. 5902) is amended to 
read as follows: 
"SEC. 1658. ALTERNATIVE AGRICULTURAL RESEARCH AND COMMER-
CIALIZATION CORPORATION. 
"(a) ESTABLISHMENT.—To carry out this subtitle, there is cre-
ated a body corporate to be known as the Alternative Agricultural 
Research and Commercialization Corporation, which shall be an 
agency of the United States, within the Department of Agriculture, 
subject to the general supervision and direction of the Secretary, 
except as specifically provided for in this subtitle. 
"(b) PURPOSE.—The purpose of the Corporation is to— 
"(1) expedite the development and market penetration of 
industrial, nonfood, nonfeed products from agricultural and 
forestry materials; and 
"(2) assist the private sector in bridging the gap between 
the results of research into nonfood, nonfeed products and 
the commercialization of the research. 
"(c) PLACE OF INCORPORATION.—^The Corporation shall be incor- District of 
porated in the District of Columbia. 
Columbia. 
"(d) CENTRAL OFFICE.—^The Secretary shall provide facilities 
for the principal office of the Corporation within the Washington, 
D.C., metropolitan area. 
"(e) WHOLLY-OWNED GOVERNMENT CORPORATION.—The Cor-
poration shall be considered a wholly-owned government corporation 
in accordance with chapter 91 of title 31, United States Code. 
"(f) GENERAL POWERS.—In addition to any other powers granted 
to the Corporation under this subtitle, the Corporation— 
"(1) shall have succession in its corporate name; 
"(2) may adopt, alter, and rescind any bylaw and adopt 
and alter a corporate seal, which shall be judicially noticed; 
"(3) may enter into any agreement or contract with a 
person or private or governmental agency, except that the 
Corporation shall not provide any financial assistance unless 
specifically authorized by this subtitle; 
"(4) may lease, purchase, accept a gift or donation of, or 
otherwise acquire, use, own, hold, improve, or otherwise deal 
in or with, and sell, convey, mortgage, pledge, lease, exchange, 
or otherwise dispose of, any property or interest in property, 
as the Corporation considers necessary in the transaction of 
110 STAT. 1114 
PUBLIC LAW 104-127—APR. 4, 1996 
Courts. 
the business of the Corporation, except that this paragraph 
shall not provide authority for carrying out a program of real 
estate investment; 
"(5) may sue and be sued in the corporate name of the 
Corporation, except that— 
"(A) no attachment, injunction, garnishment, or similar 
process shall be issued against the Corporation or property 
of the Corporation; and 
"(B) exclusive original jurisdiction shall reside in the 
district courts of the United States, but the Corporation 
may intervene in any court in any suit, action, or proceed-
ing in which the Corporation has an interest; 
"(6) may independently retain legal representation; 
"(7) may provide for and designate such committees, and 
the functions of the committees, as the Corporate Board consid-
ers necessary or desirable; 
"(8) may indemnify the Executive Director and other offi-
cers of the Corporation, as the Corporate Board considers nec-
essary and desirable, except that the Executive Director and 
officers shall not be indemnified for an act outside the scope 
of employment; 
"(9) may, with the consent of any board, commission, 
independent establishment, or executive department of the Fed-
eral Government, including any field service, use information, 
services, facilities, officials, and employees in carrying out this 
subtitle, and pay for the use, which payments shall be trans-
ferred to the applicable appropriation account that incurred 
the expense; 
"(10) may obtain the services and fix the compensation 
of any consultant and otherwise procure temporary and inter-
mittent services under section 3109(b) of title 5, United States 
Code; 
"(11) may use the United States mails on the same terms 
and conditions as the Executive agencies of the Federal Govern-
ment; 
"(12) shall have the rights, privileges, and immunities of 
the United States with respect to the right to priority of pay-
ment with respect to debts due from bankrupt, insolvent, or 
deceased creditors; 
"(13) may collect or compromise any obligations assigned 
to or held by the Corporation, including any legal or equitable 
rights accruing to the Corporation; 
"(14) shall determine the character of, and necessity for, 
obligations and expenditures of the Corporation and the manner 
in which the obligations and expenditures shall be incurred, 
allowed, and paid, subject to provisions of law specifically 
applicable to Government corporations; 
"(15) may make final and conclusive settlement and adjust-
ment of any claim by or against the Corporation or a fiscal 
officer of the Corporation; 
"(16) may sell assets, loans, and equity interests acquired 
in connection with the financing of projects funded by the 
Corporation; and 
"(17) may exercise all other lawful powers necessarily or 
reasonably related to the establishment of the Corporation to 
carry out this subtitle and the powers, purposes, functions, 
duties, and authorized activities of the Corporation. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1115 
"(g) SPECIFIC POWERS.—TO carry out this subtitle, the Corpora-
tion may— 
"(1) make grants to, and enter into cooperative agreements 
and contracts with, eligible applicants for research, develop-
ment, and demonstration projects in accordance with section 
1660; 
"(2) make loans and interest subsidy payments and invest 
venture capital in accordance with section 1661; 
"(3) collect and disseminate information concerning State, 
regional, and local commercialization projects; 
"(4) search for new nonfood, nonfeed products that may 
be produced from agricultural commodities and for processes 
to produce the products; 
"(5) administer, maintain, and dispense funds from the 
Fund to facilitate the conduct of activities under this subtitle; 
and 
"(6) engage in other activities incident to carrying out the 
functions of the Corporation.". 
(b) 
WHOLLY-OWNED 
GOVERNMENT 
CORPORATION.—Section 
9101(3) of title 31, United States Code, is amended— 
(1) by redesignating subparagraph (N) (relating to the Ura-
nium Enrichment Corporation) as subparagraph (O); and 
(2) by adding at the end the following: 
"(Q) the Alternative 
Agricultural 
Research 
and 
Commercialization Corporation.". 
(c) CONFORMING AMI']NDMENT.—Section 211(b)(5) of the Depart-
ment of Agriculture Reorganization Act of 1994 (7 U.S.C. 6911(b)(5)) 
is amended by striking "Alternative Agricultural Research and 
Commercialization Board" and inserting "Corporate Board of the 
Alternative Agricultural Research and Commercialization Corpora-
tion". 
SEC. 723. BOARD OF DIRECTORS, EMPLOYEES, AND FACILITIES. 
(a) IN GENERAL.—Section 1659 of the Food, Agriculture, Con-
servation, and Trade Act of 1990 (7 U.S.C. 5903) is amended to 
read as follows: 
"SEC. 1659. BOARD OF DIRECTORS, EMPLOYEES, AND FACILITIES. 
"(a) IN GENERAL.—^The powers of the Corporation shall be 
vested in a Corporate Board. 
"(b) 
MEMBERS OF THE CORPORATE BOARD.—^The Corporate 
Board shall consist of 11 members as follows: 
"(1) The Under Secretary of Agriculture for Rural Develop-
ment. 
"(2) The Under Secretary of Agriculture for Research, Edu-
cation, and Economics. 
"(3) 5 members appointed by the Secretary, of whom— 
"(A) at least 1 member shall be a representative of 
the leading scientific disciplines relevant to the activities 
of the Corporation; 
"(B) at least 1 member shall be a producer or processor 
of agricultural commodities; 
"(C) at least 1 member shall be a person who is pri-
vately engaged in the commercialization of new nonfood, 
nonfeed products from agricultural commodities; and 
"(D) at least 1 member shall have expertise in financial 
management. 
110 STAT. 1116 
PUBLIC LAW 104-127—APR. 4, 1996 
A different member shall be appointed pursuant to each 
subparagraph of this paragraph. 
"(4) 2 members appointed by the Secretary who— 
"(A) have expertise in areas of applied research relating 
to the development or commercialization of new nonfood, 
nonfeed products; and 
"(B) shall be appointed from a group of at least 4 
individuals nominated by the Director of the National 
Science Foundation if the nominations are made not later 
than 60 days after the date a vacancy occurs. 
"(5) 2 members appointed by the Secretary who— 
"(A) have expertise in financial and managerial mat-
ters; and 
"(B) shall be appointed from a group of at least 4 
individuals nominated by the Secretary of Commerce if 
the nominations are made not later than 60 days after 
the date a vacancy occurs. 
"(c) RESPONSIBILITIES OF THE CORPORATE BOARD.— 
"(1) IN GENERAL.—The Corporate Board shall— 
"(A) be responsible for the general supervision of the 
Corporation and Regional Centers established under sec-
tion 1663; 
"(B) determine (in consultation with Regional Centers) 
high priority commercialization areas to receive assistance 
under section 1663; 
"(C) review any grant, contract, or cooperative agree-
ment to be made or entered into by the Corporation under 
section 1660 and any financial assistance to be provided 
under section 1661; 
"(D) make the final decision, by majority vote, on 
whether and how to provide assistance to an applicant; 
and 
"(E) develop and establish a budget plan and a long-
term operating plan to carry out this subtitle. 
"(2) AUTHORITY OF THE SECRETARY.— 
"(A) IN GENERAL.—The Secretary shall vacate and 
remand to the Corporate Board for reconsideration any 
decision made pursuant to paragraph (1)(D) if the Secretary 
determines that there has been a violation of subsection 
(j), or any conflict of interest provisions of the bylaws 
of the Corporate Board, with respect to the decision. 
"(B) REASONS.—In the case of any violation and referral 
of a funding decision to the Corporate Board, the Secretary 
shall inform the Corporate Board of the reasons for any 
remand pursuant to subparagraph (A). 
"(d) CHAIRPERSON.—The members of the Corporate Board shall 
select a Chairperson from among the members of the Corporate 
Board. The term of office of the Chairperson shall be 2 years. 
The members referred to in paragraphs (1) and (2) of subsection 
(b) may not serve as Chairperson. 
"(e) EXECUTIVE DIRECTOR.— 
"(1) APPOINTMENT.—^The Corporate Board shall appoint an 
Executive Director, subject to the approval of the Secretary. 
"(2) DUTIES.—The Executive Director shall be the chief 
executive officer of the Corporation, with such power and 
authority as may be conferred by the Corporate Board. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1117 
"(3) COMPENSATION.—^The Executive Director shall receive 
basic pay at the rate provided for level IV of the Executive 
Schedule under section 5315 of title 5, United States Code. 
"(f) OFFICERS.—The Corporate Board shall establish the offices 
and appoint the officers of the Corporation, including a Secretary, 
and define the duties of the officers in a manner consistent with 
this subtitle. 
"(g) MEETINGS.—The Corporate Board shall meet at least 3 
times each fiscal year at the call of the Chairperson or at the 
request of the Executive Director. The location of the meetings 
shall be subject to approval of the Executive Director. A quorum 
of the Corporate Board shall consist of a majority of the members. 
The decisions of the Corporate Board shall be made by majority 
vote. 
"(h) TERM; VACANCIES.— 
"(1) IN GENERAL.—The term of office of a member of the 
Corporate Board shall be 4 years, except that the members 
initially appointed shall be appointed to serve staggered terms. 
A member appointed to fill a vacancy for an unexpired term 
may be appointed only for the remainder of the term. A vacancy 
on the Corporate Board shall be filled in the same manner 
as the original appointment. The Secretary may remove a mem-
ber of the Corporate Board only for cause. 
"(2) TRANSITION MEASURE.—The Secretary may appoint to 
the Corporate Board an individual who, on the day before 
the date of enactment of the Federal Agriculture Improvement 
and Reform Act of 1996, was serving on the former Alternative 
Agricultural Research and Commercialization Board, for a term 
that does not exceed the term for which the individual was 
appointed to the former Board. 
"(i) COMPENSATION.—A member of the Corporate Board who 
is an officer or employee of the United States shall not receive 
any additional compensation by reason of service on the Corporate 
Board. Any other member shall receive, for each day (including 
travel time) the member is engaged in the performance of the 
functions of the Corporate Board, compensation at a rate not to 
exceed the daily equivalent of the annual rate in effect for Level 
IV of the Executive Schedule. A member of the Corporate Board 
shall be reimbursed for travel, subsistence, and other necessary 
expenses incurred by the member in the performance of the duties 
of the member. 
"(j) CONFLICT OF INTEREST; FINANCIAL DISCLOSURE.— 
"(1) CONFLICT OF INTEREST.—Except as provided in para-
graph (3), no member of the Corporate Board shall vote on 
any matter respecting any application, contract, claim, or other 
particular matter pending before the Corporation, in which, 
to the knowledge of the member, the member, spouse, or child 
of the member, partner, or organization in which the member 
is serving as oflicer., director, trustee, partner, or employee, 
or any person or organization with whom the member is nego-
tiating or has any arrangement concerning prospective employ-
ment, has a financial interest. 
"(2) VIOLATIONS.—^Violation of paragraph (1) by a member 
of the Corporate Board shall be cause for removal of the mem-
ber, but shall not impair or otherwise affect the validity of 
any otherwise lawful action by the Corporation in which the 
member participated. 
110 STAT. 1118 
PUBLIC LAW 104-127—APR. 4, 1996 
"(3) EXCEPTIONS.—The prohibitions contained in paragraph 
(1) shall not apply if a member of the Corporate Board advises 
the Corporate Board of the nature of the particular matter 
in which the member proposes to participate, and if the member 
makes a full disclosure of the financial interest, prior to any 
participation, and the Corporate Board determines, by majority 
vote, that the financial interest is too remote or too incon-
sequential to affect the integrity of the member's services to 
the Corporation in that matter. The member involved shall 
not vote on the determination. 
"(4) FINANCIAL DISCLOSURE.—^A Board member shall be 
subject to the financial disclosure requirements set forth in 
subchapter B of chapter XVI of title 5, Code of Federal Regula-
tions (or any corresponding or similar regulation or ruling), 
applicable to a special Government employee (as defined in 
section 202(a) of title 18, United States Code). 
"(k) DELEGATION OF AUTHORITY.— 
"(1) IN GENERAL.—The Corporate Board may, by resolution, 
delegate to the Chairperson, the Executive Director, or any 
other officer or employee any function, power, or duty assigned 
to the Corporation under this subtitle, other than a function, 
power, or duty expressly vested in the Corporate Board by 
subsections (c) through (n). 
"(2) PROHIBITION ON DELEGATION.—Notwithstanding any 
other law, the Secretary and any other officer or employee 
of the United States shall not make any delegation to the 
Corporate Board, the Chairperson, the Executive Director, or 
the Corporation of any power, function, or authority not 
expressly authorized by this subtitle, unless the delegation 
is made pursuant to an authority in law that expressly makes 
reference to this section. 
"(3) REORGANIZATION ACT.—Notwithstanding any other law, 
the President (through authorities provided under chapter 9 
of title 5, United States Code) may not authorize the transfer 
to the Corporation of any power, function, or authority in 
addition to powers, functions, and authorities provided by law. 
"(1) BYLAWS.—Notwithstanding section 1658(f)(2), the Corporate 
Board shall adopt, and may from time to time amend, any bylaw 
that is necessary for the proper management and functioning of 
the Corporation. The Corporate Board shall not adopt any bylaw 
that has not been reviewed and approved by the Secretary. 
"(m) ORGANIZATION.—The Corporate Board shall provide a sys-
tem of organization to fix responsibility and promote efficiency. 
"(n) PERSONNEL AND FACILITIES OF CORPORATION.— 
"(1) APPOINTMENT AND COMPENSATION OF PERSONNEL.— 
The Corporation may select and appoint officers, attorneys, 
employees, and agents, who shall be vested with such powers 
and duties as the Corporation may determine. 
"(2) USE OF FACILITIES AND SERVICES OF THE DEPARTMENT 
OF AGRICULTURE.—Notwithstanding any other provision of law, 
to perform the responsibilities of the Corporation under this 
subtitle, the Corporation may partially or jointly utilize the 
facilities of and the services of employees of the Department 
of Agriculture, without cost to the Corporation. 
"(3) 
GOVERNMENT 
EMPLOYMENT 
LAWS.—^An officer 
or 
employee of the Corporation shall be subject to all laws of 
the United States relating to governmental employment.". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1119 
(b) CONFORMING AMENDMENT.—Section 5315 of title 5, United 
States Code, is amended by adding at the end the following: 
"Executive 
Director 
of the Alternative 
Agricultural 
Research and Commercialization Corporation.". 
SEC. 724. RESEARCH AND DEVELOPMENT GRANTS, CONTRACTS, AND 
AGREEMENTS. 
Section 1660 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5904) is amended— 
(1) by striking "Center" each place it appears and inserting 
"Corporation"; 
(2) in subsection (c), by striking "Board" and inserting 
"Corporate Board"; and 
(3) in subsection (f), by striking "non-Center" and inserting 
"non-Corporation". 
SEC. 725. COMMERCIALIZATION ASSISTANCE. 
Section 1661 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5905) is amended— 
(1) by striking "Center" each place it appears and inserting 
"Corporation"; 
(2) by striking "Board" each place it appears and inserting 
"Corporate Board"; 
(3) by striking subsection (c); 
(4) by redesignating subsections (d), (e), and (f) as sub-
sections (c), (d), and (e), respectively; and 
(5) in subsection (c) (as so redesignated)— 
(A) in the subsection heading of paragraph (1), by 
striking "DIRECTOR" and inserting "EXECUTIVE DIRECTOR"; 
and 
(B) by striking "Director" each place it appears and 
inserting "Executive Director". 
SEC. 726. GENERAL RULES REGARDING THE PROVISION OF ASSIST-
ANCE. 
Section 1662 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5906) is amended— 
(1) by striking "Center" each place it appears (except in 
subsection (b)) and inserting "Corporation"; 
(2) by striking "Board" each place it appears and inserting 
"Corporate Board"; and 
(3) in subsection (b)— 
(A) in the second sentence, by striking "Board, a 
Regional Center, or the Advisory Council" and inserting 
"Board or a Regional Center"; and 
(B) by striking the third sentence. 
SEC. 727. REGIONAL CENTERS. 
Section 1663 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5907) is amended— 
(1) by striking "Board" each place it appears and inserting 
"Corporate Board"; 
(2) in subsection (eX8), by striking "Center" and inserting 
"Corporation"; and 
(3) in subsection (0— 
(A) in paragraph (2), by striking "in consultation with 
the Advisory Council appointed under section 1661(c)"; and 
110 STAT. 1120 
PUBLIC LAW 104-127—APR. 4, 1996 
(B) by striking paragraphs (3) and (4) and inserting 
the following: 
"(3) RECOMMENDATION.—The Regional Director, based on 
the comments of the reviewers, shall make and submit a rec-
ommendation to the Board, which shall not be binding on 
the Board.". 
SEC. 728. ALTERNATIVE AGRICULTURAL RESEARCH AND COMMER-
CIALIZATION REVOLVING FUND. 
Section 1664 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5908) is amended to read as follows: 
"SEC. 1664. ALTERNATIVE AGRICULTURAL RESEARCH AND COMMER-
CIALIZATION REVOLVING FUND. 
"(a) ESTABLISHMENT.—There is established in the Treasury of 
the United States a revolving fund to be known as the Alternative 
Agricultural Research and Commercialization Revolving Fund. The 
Fund shall be available to the Corporation, without fiscal year 
limitation, to carry out this subtitle. 
"(b) CONTENTS OF FUND.—There shall be deposited in the 
Fund— 
"(1) such amounts as may be appropriated or transferred 
to support programs and activities of the Corporation; 
"(2) payments received from any source for products, serv-
ices, or property furnished in connection with the activities 
of the Corporation; 
"(3) fees and royalties collected by the Corporation from 
licensing or other arrangements relating to commercialization 
of products developed through projects funded in whole or part 
by grants, contracts, or cooperative agreements executed by 
the Corporation; 
"(4) proceeds from the sale of assets, loans, and equity 
interests made in furtherance of the purposes of the Corpora-
tion; 
"(5) donations or contributions accepted by the Corporation 
to support authorized programs and activities; and 
"(6) any other funds acquired by the Corporation. 
"(c) FUNDING ALLOCATIONS.—Funding of projects and activities 
under this subtitle shall be subject to the following restrictions: 
"(1) Of the total amount of funds made available for a 
fiscal year under this subtitle— 
"(A) not more than the lesser of 15 percent or 
$3,000,000 may be set aside to be used for authorized 
administrative expenses of the Corporation; 
"(B) not more than 1 percent may be set aside to 
be used for generic studies and specific reviews of individ-
ual proposals for financial assistance; and 
"(C) except as provided in subsection (e), not less than 
84 percent shall be set aside to be awarded to qualified 
applicants who file project applications with, or respond 
to requests for proposals from, the Corporation under sec-
tions 1660 and 1661. 
"(2) Any funds remaining uncommitted at the end of a 
fiscal year shall be credited to the Fund and added to the 
total program funds available to the Corporation for the next 
fiscal year. 
"(d) AUTHORIZED ADMINISTRATIVE EXPENSES.—For the purposes 
of this section, authorized administrative expenses shall include 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1121 
all ordinary and necessary expenses, including all compensation 
for personnel and consultants, expenses for computer usage, or 
space needs of the Corporation and similar expenses. Funds author-
ized for administrative expenses shall not be available for the 
acquisition of real property. 
"(e) PROJECT MONITORING.—The Corporate Board may estab-
lish, in the bylaws of the Corporate Board, that a percentage 
(which shall not exceed 1 percent) of the funds provided under 
subsection (c) for any commercialization project shall be expended 
to ensure that project funds are being utilized in accordance with 
the project agreement. 
"(f) TERMINATION OF THE FUND.—On expiration of the authority 
provided by this subtitle, all assets (after payment of all outstanding 
obligations) of the Fund shall revert to the general fund of the 
Treasury. 
"(g) AUTHORIZATION OF APPROPRIATIONS; CAPITALIZATION.— 
"(1) AUTHORIZATION OF APPROPRIATION.—There are author-
ized to be appropriated to the Fund $75,000,000 for each of 
fiscal years 1996 through 2002. 
"(2) CAPITALIZATION.—^The Executive Director may pay in 
as capital of the Corporation, out of dollar receipts made avail-
able through annual appropriations, $75,000,000 for each of 
fiscal years 1996 through 2002. On the payment of an amount 
of capital by the Executive Director, the Corporation shall 
issue an equivalent amount of capital stock to the Secretary 
of the Treasury. 
"(3) TRANSFER.—All obligations, assets, and related rights 
and responsibilities of the former Alternative Agricultural 
Research and Commercialization Center established under 
former section 1658 of this Act (as in effect on the day before 
the date of enactment of the Federal Agriculture Improvement 
and Reform Act of 1996) are transferred to the Corporation.". 
SEC. 729. PROCUREMENT PREFERENCES FOR PRODUCTS RECEIVING 
CORPORATION ASSISTANCE. 
Subtitle G of title XVI of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 5901 et seq.) is amended by 
adding at the end the following: 
"SEC. 
1665. 
P R O C U R E M E N T 
OF 
ALTERNATIVE 
AGRICULTURAL 
7 USC 5909. 
RESEARCH AND COMMERCIALIZATION PRODUCTS. 
"(a) DEFINITION OF EXECUTIVE AGENCY.—In this section, the 
term 'executive agency' has the meaning provided the term in 
section 4(1) of the Office of Federal Procurement Policy Act (41 
U.S.C. 403(1)). 
"(b) PROCUREMENT.—To further the achievement of the pur-
poses specified in section 1657(b), an executive agency may, for 
any procurement involving the acquisition of property, establish 
set-asides and preferences for property that has been commer-
cialized with assistance provided under this subtitle. 
"(c) SET-ASIDES.—Procurements solely for property may be set 
aside exclusively for products developed with commercialization 
assistance provided under section 1661. 
"(d) PREFERENCES.—Preferences for property developed with 
assistance provided under this subtitle in procurements involving 
the acquisition of property may be— 
"(1) a price preference, if the procurement is solely for 
property, of not greater than a percentage to be determined 
110 STAT. 1122 
PUBLIC LAW 104-127—APR. 4, 1996 
within the sole discretion of the head of the procuring agency; 
or 
"(2) a technical evaluation preference included as an award 
factor or subfactor as determined within the sole discretion 
of the head of the procuring agency. 
"(e) NOTICE.—Each competitive solicitation or invitation for 
bids selected by an executive agency for a set-aside or preference 
under this section shall contain a provision notifying offerors where 
a list of products eligible for the set-aside or preference may be 
obtained. 
"(f) ELIGIBILITY.—Offerors shall receive the set-aside or pref-
erence required under this section if, in the case of products devel-
oped with financial assistance under— 
"(1) section 1660, less than 10 years have elapsed since 
the expiration of the grant, cooperative agreement, or contract; 
"(2) paragraph (1) or (2) of section 1661(a), less than 5 
years have elapsed since the date the loan was made or insured; 
"(3) section 1661(a)(3), less than 5 years have elapsed since 
the date of sale of any remaining government equity interest 
in the company; or 
"(4) section 1661(a)(4), less than 5 years have elapsed since 
the date of the final payment on the repayable grant.". 
7 u s e 5902 note. 
SEC. 730. BUSINESS PLAN AND FEASIBILITY STUDY AND REPORT. 
(a) BUSINESS PLAN.—Not later than 180 days after the date 
of enactment of this Act, the Alternative Agricultural Research 
and Commercialization Corporation established by section 1658 of 
the Food, Agriculture, Conservation, and Trade Act of 1990 shall— 
(1) develop a 5-year business plan pursuant to section 
1659(c)(1)(E) of the Act; and 
(2) submit the plan to the Secretary of Agriculture, the 
Committee on Agriculture of the House of Representatives, 
and the Committee on Agriculture, Nutrition, and Forestry 
of the Senate. 
(b) FEASIBILITY STUDY AND REPORT.— 
(1) STUDY.—^The Secretary of Agriculture shall conduct a 
study of, and prepare a report on, the continued feasibility 
of the Alternative Agricultural Research and Commercialization 
Corporation. In conducting the study, the Secretary shall exam-
ine options for privatizing the Corporation and converting the 
Corporation to a Government-sponsored enterprise. 
(2) REPORT.—^Not later than December 31, 2001, the Sec-
retary shall transmit the report required by paragraph (1) 
to the Committee on Agriculture of the House of Representa-
tives and the Committee on Agriculture, Nutrition, and Forestry 
of the Senate. 
Subtitle B—^Amendments to the Consoli-
dated Farm and Rural Development Act 
CHAPTER 1—GENERAL PROVISIONS 
SEC. 741. WATER AND WASTE FACILITY LOANS AND GRANTS. 
(a) IN GENERAL.—Section 306(a) of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1926(a)) is amended— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1123 
(1) in the first sentence of paragraph (2), by striking 
"$500,000,000" and inserting "$590,000,000"; 
(2) by striking paragraph (7) and inserting the following: 
"(7) DEFINITION OF RURAL AND RURAL AREAS.—For the pur-
pose of water and waste disposal grants and direct and guaran-
teed loans provided under paragraphs (1) and (2), the terms 
'rural' and 'rural area' mean a city, town, or unincorporated 
area that has a population of no more than 10,000 inhabitants."; 
(3) by striking paragraphs (9), (10), and (11) and inserting 
the following: 
"(9) 
CONFORMITY WITH STATE DRINKING WATER STAND-
ARDS.—No Federal funds shall be made available under this 
section for a water system unless the Secretary determines 
that the water system will make significant progress toward 
meeting the standards established under title XIV of the Public 
Health Service Act (commonly known as the 'Safe Drinking 
Water Act') (42 U.S.C. 300f et seq.). 
"(10) CONFORMITY WITH FEDERAL AND STATE WATER POLLU-
TION CONTROL STANDARDS.—No Federal funds shall be made 
available under this section for a water treatment discharge 
or waste disposal system unless the Secretary determines that 
the effluent from the system conforms with applicable Federal 
and State water pollution control standards. 
"(11) RURAL BUSINESS OPPORTUNITY GRANTS.— 
"(A) IN GENERAL.—The Secretary may make grants, 
not to exceed $1,500,000 annually, to public bodies, private 
nonprofit community development corporations or entities, 
or such other agencies as the Secretary may select to 
enable the recipients— 
"(i) to identify and analyze business opportunities, 
including opportunities in export markets, that will 
use local rural economic and human resources; 
"(ii) to identify, train, and provide technical assist-
ance to existing or prospective rural entrepreneurs and 
managers; 
"(iii) to establish business support centers and 
otherwise 
assist 
in 
the 
creation 
of new 
rural 
businesses, the development of methods of financing 
local businesses, and the enhancement of the capacity 
of local individuals and entities to engage in sound 
economic activities; 
"(iv) to conduct regional, community, and local eco-
nomic development planning and coordination, and 
leadership development; and 
"(v) to establish centers for training, technology, 
and trade that will provide training to rural businesses 
in the utilization of interactive communications tech-
nologies to develop international trade opportunities 
and markets. 
"(B) CRITERIA.—In awarding the grants, the Secretary 
shall consider, among other criteria to be established by 
the Secretary— 
"(i) the extent to which the applicant provides 
development services in the rural service area of the 
applicant; and 
110 STAT. 1124 
PUBLIC LAW 104-127—APR. 4, 1996 
"(ii) the capability of the appHcant to accompHsh 
the activities described in the relevant clauses of 
subparagraph (A). 
"(C) COORDINATION.—The Secretary shall ensure, to 
the maximum extent practicable, that assistance provided 
under this paragraph is coordinated with and delivered 
in cooperation with similar services or assistance provided 
to rural residents by the Cooperative State Research, Edu-
cation, and Extension Service or other Federal agencies. 
"(D) AUTHORIZATION OF APPROPRIATIONS.—^There are 
authorized to be appropriated to carry out this paragraph 
$7,500,000 for each of fiscal years 1996 through 2002."; 
(4) by striking paragraphs (14) and (15); 
(5) by redesignating paragraphs (16) through (20) as para-
graphs (14) through (18), respectively; and 
(6) in paragraph (14) (as so redesignated)— 
(A) by striking "(14)(A) The" and inserting the follow-
ing: 
"(14) RURAL WATER AND WASTEWATER TECHNICAL ASSIST-
ANCE AND TRAINING PROGRAMS.— 
"(A) IN GENERAL.—The"; 
(B) in subparagraph (A)— 
(i) by striking "(i) identify" and inserting the follow-
ing: 
"(i) identify"; 
(ii) by striking "(ii) prepare" and inserting the 
following: 
"(ii) prepare"; and 
(iii) by striking "(iii) improve" and inserting the 
following: 
"(iii) improve"; 
(C) in subparagraph (B), by striking "(B) In" and insert-
ing the following: 
"(B) SELECTION PRIORITY.—In"; and 
(D) in subparagraph (C)— 
(i) by striking "(C) Not" and inserting the following: 
"(C) FUNDING.—Not"; and 
(ii) by striking "2 per centum of any funds provided 
in appropriations Acts" and inserting "3 percent of 
any funds appropriated". 
(b) CONFORMING AMENDMENT.—^The second sentence of section 
309A(a) of the Consolidated Farm and Rural Development Act 
(7 U.S.C. 1929a(a)) (as amended by section 661(c)(1)) is amended 
by striking ", 306(a)(14),". 
SEC. 742. EMERGENCY COMMUNITY WATER ASSISTANCE GRANT PRO-
GRAM FOR SMALL COMMUNITIES. 
Section 306A of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1926a) is amended— 
(1) in subsection (e)— 
(A) in paragraph (1)(A), by striking "15,000" and insert-
ing "10,000"; and 
(B) in paragraph (2), by striking "5,000" and inserting 
"3,000"; and 
(2) by striking subsection (i) and inserting the following: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1125 
"(i) AUTHORIZATION OF APPROPRIATIONS.—^There are authorized 
to be appropriated to carry out this section $35,000,000 for each 
of fiscal years 1996 through 2002.". 
SEC. 743. EMERGENCY COMMUNITY WATER ASSISTANCE GRANT PRO-
GRAM FOR SMALLEST COMMUNITIES. 
Section 306B of the ConsoHdated Farm and Rural Development 
Act (7 U.S.C. 1926b) is repealed. 
SEC. 744. AGRICULTURAL CREDIT INSURANCE FUND. 
Section 309(f) of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1929(f)) is amended— 
(1) by striking paragraph (1); and 
(2) by redesignating paragraphs (2) through (6) as para-
graphs (1) through (5), respectively. 
SEC. 745. RURAL DEVELOPMENT INSURANCE FUND. 
Section 309A(g) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1929a(g)) is amended— 
(1) by striking paragraph (1); and 
(2) by redesignating paragraphs (2) through (8) as para-
graphs (1) through (7), respectively. 
SEC. 746. INSURED WATERSHED AND RESOURCE CONSERVATION AND 
DEVELOPMENT LOANS. 
Section 3 lOA of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1931) is repealed. 
SEC. 747. RURAL INDUSTRIALIZATION ASSISTANCE. 
(a) IN GENERAL.—Section 310B of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1932) is amended— 
(1) in the first sentence of subsection (a)— 
(A) by striking "and" at the end of clause (2); and 
(B) by inserting before the period the following: ", 
and (4) to facilitate economic opportunity for industries 
undergoing adjustment from terminated Federal agricul-
tural price and income support programs or increased com-
petition from foreign trade"; 
(2) in subsection (b), by striking "(b)(1)" and all that follows 
through "(2) The" and inserting the following: 
"(b) SOLID WASTE MAJI^JAGEMENT GRANTS.—The"; 
(3) in subsection (c)— 
(A) by striking "(c)(1) The" and inserting the following: 
"(c) RURAL BUSINESS ENTERPRISE GRANTS.— 
"(1) I N GENERAL.—The"; 
(B) in paragraph (1), by inserting "(including nonprofit 
entities)" after "private business enterprises"; 
(C) in paragraph (2)— 
(i) by striking "(2) The" and inserting the following: 
"(2) PASSENGER TRANSPORTATION SERVICES OR FACILITIES.— 
The"; and 
(ii) by striking "make grants" and inserting "award 
grants on a competitive basis"; and 
(D) by adding at the end the following: 
"(3) GRANTS TO AID INDUSTRIES IN ADJUSTING TO TERMI-
NATED FEDERAL AGRICULTURAL PROGRAMS OR INCREASED FOR-
EIGN COMPETITION.—The Secretary may make grants under 
this section to facilitate economic opportunity for industries 
110 STAT. 1126 
PUBLIC LAW 104-127—APR. 4, 1996 
undergoing adjustment from terminated Federal agricultural 
price and income support programs or increased competition 
from foreign trade."; 
(4) by striking subsection (e) and inserting the following: 
"(e) RURAL COOPERATIVE DEVELOPMENT GRANTS.— 
"(1) DEFINITIONS.—In this subsection: 
"(A) NONPROFIT INSTITUTION.—^The term 
'nonprofit 
institution' means any organization or institution, including 
an accredited institution of higher education, no part of 
the net earnings of which inures, or may lawfully inure, 
to the benefit of any private shareholder or individual. 
"(B) UNITED STATES.—The term United States' means 
the several States, the District of Columbia, the Common-
wealth of Puerto Rico, the Virgin Islands, Guam, American 
Samoa, and the other territories and possessions of the 
United States. 
"(2) GRANTS.—The Secretary shall make grants under this 
subsection to nonprofit institutions for the purpose of enabling 
the institutions to establish and operate centers for rural 
cooperative development. 
"(3) GOALS.—The goals of a center funded under this sub-
section shall be to facilitate the creation of jobs in rural areas 
through the development of new rural cooperatives, value added 
processing, and rural businesses. 
"(4) APPLICATION.—^Any nonprofit institution seeking a 
grant under paragraph (2) shall submit to the Secretary an 
application containing a plan for the establishment and oper-
ation by the institution of a center or centers for cooperative 
development. The Secretary may approve the application if 
the plan contains the following: 
"(A) A provision that substantiates that the center 
will effectively serve rural areas in the United States. 
"(B) A provision that the primary objective of the center 
will be to improve the economic condition of rural areas 
through cooperative development. 
"(C) A description of the activities that the center 
will carry out to accomplish the objective. The activities 
may include the following: 
"(i) Programs for applied research and feasibility 
studies that may be useful to individuals, cooperatives, 
small businesses, and other similar entities in rural 
areas served by the center. 
"(ii) Programs for the collection, interpretation, and 
dissemination of information that may be useful to 
individuals, cooperatives, small businesses, and other 
similar entities in rural areas served by the center, 
"(iii) Programs providing training and instruction 
for individuals, cooperatives, small businesses, and 
other similar entities in rural areas served by the 
center. 
"(iv) Programs providing loans and grants to 
individuals, cooperatives, small businesses, and other 
similar entities in rural areas served by the center. 
"(v) Programs 
providing technical 
assistance, 
research services, and advisory services to individuals, 
cooperatives, small businesses, and other similar enti-
ties in rural areas served by the center. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1127 
"(vi) Programs providing for the coordination of 
services and sharing of information among the center. 
"(D) A description of the contributions that the activi-
ties are Hkely to make to the improvement of the economic 
conditions of the rural areas for which the center will 
provide services. 
"(E) Provisions that the center, in carrying out the 
activities, will seek, where appropriate, the advice, partici-
pation, expertise, and assistance of representatives of busi-
ness, industry, 
educational 
institutions, 
the 
Federal 
Government, and State and local governments. 
"(F) Provisions that the center will take all practicable 
steps to develop continuing sources of financial support 
for the center, particularly from sources in the private 
sector. 
"(G) Provisions for— 
"(i) monitoring and evaluating the activities by 
the nonprofit institution operating the center; and 
"(ii) accounting for money received by the institu-
tion under this section. 
"(5) AWARDING GRANTS.—Grants made under paragraph 
(2) shall be made on a competitive basis. In making grants 
under paragraph (2), the Secretary shall give preference to 
grant applications providing for the establishment of centers 
for rural cooperative development that— 
"(A) demonstrate a proven track record in administer-
ing a nationally coordinated, regionally or State-wide oper-
ated project; 
"(B) demonstrate previous expertise in providing tech-
nical assistance in rural areas; 
"(C) demonstrate the ability to assist in the retention 
of businesses, facilitate the establishment of cooperatives 
and new cooperative approaches, and generate employment 
opportunities that will improve the economic conditions 
of rural areas; 
"(D) demonstrate the ability to create horizontal link-
ages among businesses within and among various sectors 
in rural areas of the United States and vertical linkages 
to domestic and international markets; 
"(E) commit to providing technical assistance and other 
services to underserved and economically distressed areas 
in rural areas of the United States; and 
"(F) commit to providing greater than a 25 percent 
matching contribution with private funds and in-kind con-
tributions. 
"(6) 1-YEAR GRANTS; AUTHORITY TO APPROVE GRANT FOR 
1 ADDITIONAL YEAR WITHOUT APPLICATION.—^The Secretary shall 
make grants under this subsection for a period of 1 year. 
The Secretary shall evaluate programs receiving assistance 
under this subsection. If the Secretary determines it to be 
in the best interest of the program, the Secretary may award 
an additional grant to the program for the immediately succeed-
ing year without application for the grant. 
"(7) 
TECHNICAL 
ASSISTANCE 
TO 
PREVENT 
EXCESSIVE 
UNEMPLOYMENT OR UNDEREMPLOYMENT.—In c a r r y i n g OUt t h i s 
subsection, the Secretary may provide technical assistance to 
alleviate or prevent conditions of excessive unemployment, 
110 STAT. 1128 
PUBLIC LAW 104-127—APR. 4, 1996 
underemployment, outmigration, or low employment growth 
in economically distressed rural areas that the Secretary deter-
mines have a substantial need for the assistance. The assistance 
may include planning and feasibility studies, management and 
operational assistance, and studies evaluating the need for 
development potential of projects that increase employment 
and improve economic growth in the areas. 
"(8) GRANTS TO DEFRAY ADMINISTRATIVE COSTS.—^The Sec-
retary may make grants to defray not to exceed 75 percent 
of the costs incurred by organizations and public bodies to 
carry out projects for which grants or loans are made under 
this subsection. For purposes of determining the non-Federal 
share of the costs, the Secretary shall consider contributions 
in cash and in kind, fairly evaluated, including premises, equip-
ment, and services. 
"(9) 
AUTHORIZATION 
OF APPROPRIATIONS.—^There 
are 
authorized to be appropriated to carry out this subsection 
$50,000,000 for each of fiscal years 1996 through 2002."; 
(5) by striking subsections (f), (g), (h), and (i); 
(6) by redesignating subsection (j) &s subsection (f); and 
(7) by adding at the end the following: 
"(g) LOAN GUARANTEES FOR THE PURCHASE OF COOPERATIVE 
STOCK.— 
"(1) DEFINITION OF FARMER.—In this subsection, the term 
'farmer' means any farmer that the Secretary determines is 
a family farmer. 
"(2) LOAN GUARANTEES.—^The Secretary may guarantee 
loans under this section to individual farmers for the purpose 
of purchasing start-up capital stock of a farmer cooperative 
established for the purpose of processing an agricultural 
commodity. 
"(3) ELIGIBILITY.—To be eligible for a loan guarantee under 
this subsection, a farmer must produce the agricultural 
commodity that will be processed by the cooperative.", 
(b) CONFORMING AMENDMENTS.— 
(1) Clause (iii) of section 307(a)(6)(B) of the Consolidated 
Farm and Rural Development Act (7 U.S.C. 1927(a)(6)(B)) (as 
redesignated by section 661(a)(2)) is amended by striking "sub-
sections (d) and (e) of section 310B" and inserting "section 
310B(d)". 
(2) Section 232(c)(2) of the Department of Agriculture 
Reorganization Act of 1994 (7 U.S.C. 6942(c)(2)) is amended— 
(A) by striking "310B(b)(2)" and inserting "310B(b)"; 
and 
(B) by striking "1932(b)(2)" and inserting "1932(b)". 
(3) Section 233(b) of the Department of Agriculture Reorga-
nization Act of 1994 (7 U.S.C. 6943(b)) is amended— 
(A) by striking paragraph (2); and 
(B) by redesignating paragraph (3) as paragraph (2). 
SEC. 748. ADMINISTRATION. 
Section 331(b)(4) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1981(b)(4)) is amended— 
(1) by inserting after "claims" the following: "(including 
debts and claims arising from loan guarantees)"; 
(2) by striking "Farmers Home Administration or" and 
inserting "Consolidated Farm Service Agency, Rural Utilities 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1129 
Service, Rural Housing Service, Rural Business-Cooperative 
Service, or a successor agency, or"; and 
(3) by inserting after "activities under the Housing Act Notification. 
of 1949." the following: "In the case of a security instrument 
entered into under the Rural Electrification Act of 1936 (7 
U.S.C. 901 et seq.), the Secretary shall notify the Attorney 
General of the intent of the Secretary to exercise the authority 
of the Secretary under this paragraph.". 
SEC. 749. AUTHORIZATION OF APPROPRIATIONS. 
(a) IN GENERAL.—Section 338 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1988) is amended— 
(1) by striking subsections (b), (c), (d), and (e); and 
(2) by redesignating subsection (f) as subsection (b). 
(b) CONFORMING AMENDMENTS.— 
(1) The first sentence of section 309(g)(1) of the Consoli-
dated Farm and Rural Development Act (7 U.S.C. 1929(g)(1)) 
is amended by inserting after "section 338(c)" the following: 
"(before the amendment made by section 749(a)(1) of the Fed-
eral Agriculture Improvement and Reform Act of 1996)". 
(2) Section 343(b) of the Consolidated Farm and Rural 
Development Act (7 U.S.C. 1991(b)) is amended by striking 
"338(f)," and inserting "338(b),". 
SEC. 750. TESTIMONY BEFORE CONGRESSIONAL COMMITTEES. 
Section 345 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1993) is repealed. 
SEC. 751. PROHIBITION ON USE OF LOANS FOR CERTAIN PURPOSES. 
Section 363 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 2006e) is amended by adding at the end the following: 
"This section shall not apply to a loan made or guaranteed under 
this title for a utility line.". 
SEC. 
752. 
RURAL 
DEVELOPMENT 
CERTIFIED 
LENDERS 
PROGRAM. 
The Consolidated Farm and Rural Development Act is amended 
by inserting after section 363 (7 U.S.C. 2006e) the following: 
"SEC. 364. RURAL DEVELOPMENT CERTIFIED LENDERS PROGRAM. 
7 USC 2006f. 
"(a) CERTIFIED LENDERS PROGRAM.— 
"(1) IN GENERAL.—^The Secretary may establish a program 
under which the Secretary may guarantee a loan for any rural 
development program that is made by a lender certified by 
the Secretary. 
"(2) 
CERTIFICATION REQUIREMENTS.—^The Secretary 
may 
certify a lender if the lender meets such criteria as the Sec-
retary may prescribe in regulations, including the ability of 
the lender to properly make, service, and liquidate the guaran-
teed loans of the lender. 
"(3) CONDITION OF CERTIFICATION.—^As a condition of certifi-
cation, the Secretary may require the lender to undertake to 
service the guaranteed loan using standards that are not less 
stringent than generally accepted banking standards concerning 
loan servicing that are used by prudent commercial or coopera-
tive lenders. 
"(4) GUARANTEE.—Notwithstanding any other provision of 
law, the Secretary may guarantee not more than 80 percent 
of a loan made by a certified lender described in paragraph 
29-194 O - 96 - 37 : QL 3 Part 1 
110 STAT. 1130 
PUBLIC LAW 104-127—APR. 4, 1996 
(1), if the borrower of the loan meets the eligibihty requirements 
and such other criteria for the loan guarantee that are estab-
lished by the Secretary. 
"(5) CERTIFICATIONS.—^With respect to loans to be guaran-
teed, the Secretary may permit a certified lender to make 
appropriate certifications (as provided in regulations issued 
by the Secretary)— 
"(A) relating to issues such as creditworthiness, repay-
ment ability, adequacy of collateral, and feasibility of the 
operation; and 
"(B) that the borrower is in compliance with all require-
ments of law, including regulations issued by the Secretary. 
"(6) RELATIONSHIP TO OTHER REQUIREMENTS.—^This sub-
section shall not affect the responsibility of the Secretary to 
determine eligibility, review financial information, and other-
wise assess an application. 
"(b) PREFERRED CERTIFIED LENDERS PROGRAM.— 
"(1) IN GENERAL.—The Secretary may establish a preferred 
certified lenders program for lenders who establish their— 
"(A) knowledge of, and experience under, the program 
established under subsection (a); 
"(B) knowledge of the regulations concerning the 
particular guaranteed loan program; and 
"(C) proficiency related to the certified lender program 
requirements. 
"(2) ADDITIONAL LENDING INSTITUTIONS.—The Secretary 
may certify any lending institution as a preferred certified 
lender if the institution meets such additional criteria as the 
Secretary may prescribe by regulation. 
"(3) REVOCATION OF DESIGNATION.—The designation of a 
lender as a preferred certified lender shall be revoked if the 
Secretary determines that the lender is not adhering to the 
rules and regulations applicable to the program or if the loss 
experiences of the preferred certified lender are greater than 
other preferred certified lenders, except that the suspension 
or revocation shall not affect any outstanding guarantee. 
"(4) CONDITION OF CERTIFICATION.—^As a condition of the 
preferred certification, the Secretary shall require the lender 
to undertake to service the loan guaranteed by the Secretary 
under this subsection using generally accepted banking stand-
ards concerning loan servicing employed by prudent commercial 
or cooperative lenders. The Secretary shall, at least annually, 
monitor the performance of each preferred certified lender to 
ensure that the conditions of the certification are being met. 
"(5) EFFECT OF PREFERRED LENDER CERTIFICATION.—Not-
withstanding any other provision of law, the Secretary may— 
"(A) guarantee not more than 80 percent of any 
approved loan made by a preferred certified lender as 
described in this subsection, if the borrower meets the 
eligibility requirements and such other criteria as may 
be applicable to loans guaranteed by the Secretary; and 
"(B) permit preferred certified lenders to make all deci-
sions, with respect to loans to be guaranteed by the Sec-
retary under this subsection relating to creditworthiness, 
the closing, monitoring, collection, and liquidation of loans, 
and to accept appropriate certifications, as provided in 
regulations issued by the Secretary, that the borrower is 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1131 
in compliance with all requirements of law and regulations 
issued by the Secretary.". 
SEC. 753. SYSTEM FOR DELIVERY OF CERTAIN RURAL DEVELOPMENT 
PROGRAMS. 
(a) IN GENERAL.—Section 365 of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 2008) is repealed. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 2375 of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 6613) is amended— 
(A) in subsection (e), by striking ", as defined in section 
365(b)(2) of the Consolidated Farm and Rural Development 
Act,"; and 
(B) by adding at the end the following: 
"(g) 
DEFINITION OF DESIGNATED RURAL DEVELOPMENT PRO-
GRAM.—In this section, the term 'designated rural development 
program' means a program carried out under section 304(b), 306(a), 
or 310B(e) of the Consolidated Farm and Rural Development Act 
(7 U.S.C. 1924(b), 1926(a), and 1932(e)) for which funds are avail-
able at any time during the fiscal year.". 
(2) Paragraph (2) of section 233(b) of the Department of 
Agriculture Reorganization Act of 1994 (7 U.S.C. 6943(b)) (as 
redesignated by section 747(b)(3)(B)) is amended by striking 
"sections 365 through 369 of the Consolidated Farm and Rural 
Development Act (7 U.S.C. 2008-2008d)" and inserting "section 
369 of the Consolidated Farm and Rural Development Act 
(7 U.S.C. 2008d)". 
SEC. 754. STATE RURAL ECONOMIC DEVELOPMENT REVIEW PANEL. 
Section 366 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 2008a) is repealed. 
SEC. 755. LIMITED TRANSFER AUTHORITY OF LOAN AMOUNTS. 
Section 367 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 2008b) is repealed. 
SEC. 756. ALLOCATION AND TRANSFER OF LOAN GUARANTEE AUTHOR-
ITY. 
Section 368 of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 2008c) is repealed. 
SEC. 757. WATER SYSTEMS FOR RURAL AND NATIVE VILLAGES IN 
ALASKA-
The Consolidated Farm and Rural Development Act is amended 
by inserting after section 306C (7 U.S.C. 1926c) the following: 
"SEC. 306D. WATER SYSTEMS FOR RURAL AND NATIVE VILLAGES IN 
7 USC 1926d. 
ALASKA. 
"(a) IN GENERAL.—The Secretary may make grants to the State 
of Alaska for the benefit of rural or Native villages in Alaska 
to provide for the development and construction of water and 
wastewater systems to improve the health and sanitation conditions 
in those villages. 
"(b) MATCHING FUNDS.—To be eligible to receive a grant under 
subsection (a), the State of Alaska shall provide equal matching 
funds from non-Federal sources. 
"(c) CONSULTATION WITH THE STATE OF ALASKA.—^The Secretary 
shall consult with the State of Alaska on a method of prioritizing 
110 STAT. 1132 
PUBLIC LAW 104-127—APR. 4, 1996 
the allocation of grants under subsection (a) according to the needs 
of, and relative health and sanitation conditions in, each village. 
"(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated to carry out this section $15,000,000 for each 
of fiscal years 1996 through 2002.". 
SEC. 758. APPLICATION REQUIREMENTS RELATING TO WATER AND 
WASTE DISPOSAL LOAN AND GRANT PROGRAMS. 
Section 306(a) of the Consolidated Farm and Rural Develop-
7 use 1926. 
ment Act (7 U.S.C. 926(a)) is amended by inserting after paragraph 
(4) the following: 
"(5) APPLICATION REQUIREMENTS.—Not earlier than 60 days 
before a preliminary application is filed for a loan under para-
graph (1) or a grant under paragraph (2) for a water or waste 
disposal purpose, a notice of the intent of the applicant to 
apply for the loan or grant shall be published in a general 
circulation newspaper. The selection of engineers for a project 
design shall be done by a request for proposals by the 
applicant.". 
SEC. 
7
5
9
. 
NATIONAL 
SHEEP 
INDUSTRY 
IMPROVEMENT 
CENTER. 
The Consolidated Farm and Rural Development Act (as amend-
ed by section 649) is amended by adding at the end the following: 
Goats. 
"SEC. 375. NATIONAL SHEEP INDUSTRY IMPROVEMENT CENTER. 
•'• 
"(a) DEFINITIONS.—In this section: 
"(1) BOARD.—The term 'Board' means the Board of Direc-
tors established under subsection (f). 
"(2) CENTER.—The term 'Center' means the National Sheep 
Industry Improvement Center established under subsection (b). 
"(3) ELIGIBLE ENTITY.—^The term 'eligible entity' means an 
entity that promotes the betterment of the United States sheep 
or goat industries and that is— 
"(A) a public, private, or cooperative organization; 
"(B) an association, including a corporation not oper-
ated for profit; 
"(C) a federally recognized Indian Tribe; or 
"(D) a public or quasi-public agency. 
"(4) FUND.—^The term 'Fund' means the National Sheep 
Industry Improvement Center Revolving Fund established 
under subsection (e). 
"(b) ESTABLISHMENT OF CENTER.—The Secretary shall establish 
a National Sheep Industry Improvement Center. 
"(c) PURPOSES.—The purposes of the Center shall be to— 
"(1) promote strategic development activities and collabo-
rative efforts by private and State entities to maximize the 
impact of Federal assistance to strengthen and enhance produc-
tion and marketing of sheep or goat products in the United 
States; 
"(2) optimize the use of available human capital and 
resources within the sheep or goat industries; 
"(3) provide assistance to meet the needs of the sheep 
or goat industry for infrastructure development, business devel-
opment, production, resource development, and market and 
environmental research; 
"(4) advance activities that empower and build the capacity 
of the United States sheep or goat industry to design unique 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1133 
responses to the special needs of the sheep or goat industries 
on both a regional and national basis; and 
"(5) adopt flexible and innovative approaches to solving 
the long-term needs of the United States sheep or goat industry. 
"(d) STRATEGIC PLAN.— 
"(1) IN GENERAL.—The Center shall submit to the Secretary 
an annual strategic plan for the delivery of financial assistance 
provided by the Center. 
"(2) REQUIREMENTS.—^A strategic plan shall identify— 
"(A) goals, methods, and a benchmark for measuring 
the success of carrying out the plan and how the plan 
relates to the national and regional goals of the Center; 
"(B) the amount and sources of Federal and non-Fed-
eral funds that are available for carrying out the plan; 
"(C) funding priorities; 
"(D) selection criteria for funding; and 
"(E) a method of distributing funding. 
"(e) REVOLVING FUND.— 
"(1) ESTABLISHMENT.—^There is established in the Treasury 
the National Sheep Industry Improvement Center Revolving 
Fund. The Fund shall be available to the Center, without 
fiscal year limitation, to carry out the authorized programs 
and activities of the Center under this section. 
"(2) CONTENTS OF FUND.—There shall be deposited in the 
Fund— 
"(A) such amounts as may be appropriated, transferred, 
or otherwise made available to support programs and 
activities of the Center; 
"(B) payments received from any source for products, 
services, or property furnished in connection with the 
activities of the Center; 
"(C) fees and royalties collected by the Center from 
licensing or other arrangements relating to commercializa-
tion of products developed through projects funded, in 
whole or part, by grants, contracts, or cooperative agree-
ments executed by the Center; 
"(D) proceeds from the sale of assets, loans, and equity 
interests made in furtherance of the purposes of the Center; 
"(E) donations or contributions accepted by the Center 
to support authorized programs and activities; and 
"(F) any other funds acquired by the Center. 
"(3) USE OF FUND.— 
"(A) IN GENERAL.—The Center may use amounts in 
the Fund to make grants and loans to eligible entities 
in accordance with a strategic plan submitted under sub-
section (d). 
"(B) CONTINUED EXISTENCE.—The Center shall manage 
the Fund in a manner that ensures that sufficient amounts 
are available in the Fund to carry out subsection (c). 
"(C) DIVERSE AREA.—The Center shall, to the maximum 
extent practicable, use the Fund to serve broad geographic 
areas and regions of diverse production. 
"(D) VARlETi' OF LOANS AND GRANTS.—The Center shall, 
to the maximum extent practicable, use the Fund to provide 
a variety of grants and intermediate- and long-term loans. 
110 STAT. 1134 
PUBLIC LAW 104-127—APR. 4, 1996 
"(E) ADMINISTRATION.—^The Center may not use more 
than 3 percent of the amounts in the Fund for a fiscal 
year for the administration of the Center. 
"(F) INFLUENCING LEGISLATION.—None of the amounts 
in the Fund may be used to influence legislation. 
"(G) ACCOUNTING.—To be eligible to receive amounts 
from the Fund, an entity must agree to account for the 
amounts using generally accepted accounting principles. 
"(H) USES OF FUND.—The Center may use amounts 
in the Fund to— 
"(i) participate with Federal and State agencies 
in financing activities that are in accordance with a 
strategic plan submitted under subsection (d), includ-
ing participation with several States in a regional 
effort; 
"(ii) participate with other public and private fund-
ing sources in financing activities that are in accord-
ance with the strategic plan, including participation 
in a regional effort; 
"(iii) provide security for, or make principal or 
interest payments on, revenue or general obligation 
bonds issued by a State, if the proceeds from the sale 
of the bonds are deposited in the Fund; 
"(iv) accrue interest; 
"(v) guarantee or purchase insurance for local 
obligations to improve credit market access or reduce 
interest rates for a project that is in accordance with 
the strategic plan; or 
"(vi) sell assets, loans, and equity 
interests 
acquired in connection with the financing of projects 
funded by the Center. 
"(4) LOANS.— 
"(A) RATE.—^A loan from the Fund may be made at 
an interest rate that is below the market rate or may 
be interest free. 
"(B) TERM.—^The term of a loan may not exceed the 
shorter of— 
"(i) the useful life of the activity financed; or 
"(ii) 40 years. 
"(C) SOURCE OF REPAYMENT.—^The Center may not 
make a loan from the Fund unless the recipient establishes 
an assured source of repayment. 
"(D) PROCEEDS.—^All payments of principal and interest 
on a loan made from the Fund shall be deposited into 
the Fund. 
"(5) MAINTENANCE OF EFFORT.—^The Center shall use the 
Fund only to supplement and not to supplant Federal, State, 
and private funds expended for rural development. 
"(6) FUNDING.— 
"(A) DEPOSIT OF FUNDS.—^All Federal and non-Federal 
amounts received by the Center to carry out this section 
shall be deposited in the Fund. 
"(B) MANDATORY FUNDS.—Out of any moneys in the 
Treasury not otherwise appropriated, the Secretary of the 
Treasury shall provide to the Center not to exceed 
$20,000,000 to carry out this section. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1135 
"(C) ADDITIONAL FUNDS.—In addition to any funds pro-
vided under subparagraph (B), there is authorized to be 
appropriated $30,000,000 to carry out this section. 
"(D) PRIVATI2;ATION.—No additional Federal funds shall 
be used to carry out this section beginning on the earlier 
of— 
"(i) the date that is 10 years after the date of 
enactment of this section; or 
"(ii) the day after a total of $50,000,000 has been 
made available under subparagraphs (B) and (C) to 
carry out this section. 
"(f) BOARD OF DIRECTORS.— 
"(1) IN GENERAL.—The management of the Center shall 
be vested in a Board of Directors. 
"(2) POWERS.—The Board shall— 
"(A) be responsible for the general supervision of the 
Center; 
"(B) review any grant, loan, contract, or cooperative 
agreement to be made or entered into by the Center and 
any financial assistance provided to the Center; 
"(C) make the final decision, by majority vote, on 
whether and how to provide assistance to an applicant; 
and 
"(D) develop and establish a budget plan and a long-
term operating plan to carry out the goals of the Center. 
"(3) COMPOSITION.—^The Board shall be composed of^ 
"(A) 7 voting members, of whom— 
"(i) 4 members shall be active producers of sheep 
or goats in the United States; 
"(ii) 2 members shall have expertise in finance 
and management; and 
"(iii) 1 member shall have expertise in lamb, wool, 
goat, or goat product marketing; and 
"(B) 2 nonvoting members, of whom— 
"(i) 1 member shall be the Under Secretary of 
Agriculture for Rural Development; and 
"(ii) 1 member shall be the Under Secretary of 
Agriculture for Research, Education, and Economics. 
"(4) NOMINATION.— 
"(A) NOMINATING BODY.—The Secretary shall appoint 
the voting members of the Board from nominations submit-
ted by organizations described in subparagraph (B). 
"(B) NATIONAL ORGANIZATIONS.—^A national organiza-
tion is described in this subparagraph if the organization— 
"(i) consists primarily of active sheep or goat 
producers in the United States; and 
"(ii) has as the primary interest of the organization 
the production of sheep or goats in the United States. 
"(5) TERM OF OFFICE.— 
"(A) IN GENERAL.—Subject to subparagraph (B), the 
term of office of a voting member of the Board shall be 
3 years. 
"(B) STAGGERED INITIAL TERMS.—The initial voting 
members of the Board (other than the chairperson of the 
initially established Board) shall serve for staggered terms 
of 1, 2, and 3 years, as determined by the Secretary. 
110 STAT. 1136 
PUBLIC LAW 104-127—APR. 4, 1996 
"(C) REELECTION.—^A voting member may be reelected 
for not more than 1 additional term. 
"(6) VACANCY.— 
"(A) IN GENERAL.—^A vacancy on the Board shall be 
filled in the same manner as the original Board. 
"(B) REELECTION.—A member elected to fill a vacancy 
for an unexpired term may be reelected for 1 full term. 
"(7) CHAIRPERSON.— 
"(A) IN GENERAL.—The Board shall select a chairperson 
from among the voting members of the Board. 
"(B) TERM.—The term of office of the chairperson shall 
be 2 years. 
"(8) ANNUAL MEETING.— 
"(A) IN GENERAL.—^The Board shall meet not less than 
once each fiscal year at the call of the chairperson or 
at the request of the executive director appointed under 
subsection (g)(1). 
"(B) LOCATION.—^The location of a meeting of the Board 
shall be established by the Board. 
"(9) VOTING.— 
"(A) QUORUM.—^A quorum of the Board shall consist 
of a majority of the voting members. 
"(B) MAJORITY VOTE.—^A decision of the Board shall 
be made by a majority of the voting members of the Board. 
"(10) CONFLICTS OF INTEREST.— 
"(A) IN GENERAL.—Except as provided in subparagraph 
(D), a member of the Board shall not vote on any matter 
respecting any application, contract, claim, or other particu-
lar matter pending before the Board in which, to the knowl-
edge of the member, an interest is held by— 
"(i) the member; 
"(ii) any spouse of the member; 
"(iii) any child of the member; 
"(iv) any partner of the member; 
"(v) any organization in which the member is serv-
ing as an officer, director, trustee, partner, or employee; 
or 
"(vi) any person with whom the member is nego-
tiating or has any arrangement concerning prospective 
employment or with whom the member has a financial 
interest. 
"(B) REMOVAL.—^Any action by a member of the Board 
that violates subparagraph (A) shall be cause for removal 
from the Board. 
"(C) VALIDITY OF ACTION.—^An action by a member 
of the Board that violates subparagraph (A) shall not 
impair or otherwise affect the validity of any otherwise 
lawful action by the Board. 
"(D) DISCLOSURE.— 
"(i) IN GENERAL.—If a member of the Board makes 
a full disclosure of an interest and, prior to any partici-
pation by the member, the Board determines, by major-
ity vote, that the interest is too remote or too incon-
sequential to affect the integrity of any participation 
by the member, the member may participate in the 
matter relating to the interest, except as provided in 
subparagraph (E)(iii). 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1137 
"(ii) VOTE.—^A member that discloses an interest 
under clause (i) shall not vote on a determination 
of whether the member may participate in the matter 
relating to the interest. 
"(E) REMANDS.— 
"(i) IN GENERAL.—The Secretary may vacate and 
remand to the Board for reconsideration any decision 
made pursuant to subsection (e)(3)(H) if the Secretary 
determines that there has been a violation of this 
paragraph or any conflict of interest provision of the 
bylaws of the Board with respect to the decision. 
"(ii) REASONS.—In the case of any violation and 
remand of a funding decision to the Board under clause 
(i), the Secretary shall inform the Board of the reasons 
for the remand. 
"(iii) 
CONFLICTED 
MEMBERS NOT TO VOTE ON 
REMANDED DECISIONS.—If a decision with respect to 
a matter is remanded to the Board by reason of a 
conflict of interest faced by a Board member, the mem-
ber may not participate in any subsequent decision 
with respect to the matter. 
"(11) COMPENSATION.— 
"(A) IN GENERAL.—^A member of the Board shall not 
receive any compensation by reason of service on the Board. 
"(B) EXPENSES.—^A member of the Board shall be 
reimbursed for travel, subsistence, and other necessary 
expenses incurred by the member in the performance of 
a duty of the member. 
"(12) BYLAWS.—The Board shall adopt, and may from time 
to time amend, an}^ bylaw that is necessary for the proper 
management and functioning of the Center. 
"(13) PUBLIC HEARINGS.—Not later than 1 year after the 
date of enactment of this section, the Board shall hold public 
hearings on policy objectives of the program established under 
this section. 
"(14) ORGANIZATIONAL SYSTEM.—^The Board shall provide 
a system of organization to fix responsibility and promote effi-
ciency in carrying out the functions of the Board. 
"(15) USE OF DEPARTMENT OF AGRICULTURE.—The Board 
may, with the consent of the Secretary, utilize the facilities 
of and the services of employees of the Department of Agri-
culture, without cost to the Center. 
"(g) OFFICERS AND EMPLOYEES.— 
"(1) EXECUTIVE DIRECTOR.— 
"(A) IN GENERAL.—The Board shall appoint an execu-
tive director to be the chief executive officer of the Center. 
"(B) TENURE.—The executive director shall serve at 
the pleasure of the Board. 
"(C) COMPENSATION.—Compensation for the executive 
director shall be established by the Board. 
"(2) OTHER OFFICERS AND EMPLOYEES.—^The Board may 
select and appoint officers, attorneys, employees, and agents 
who shall be vested with such powers and duties as the Board 
may determine. 
"(3) DELEGATION.—^The Board may, by resolution, delegate 
to the chairperson, the executive director, or any other officer 
or employee any function, power, or duty of the Board other 
110 STAT. 1138 
PUBLIC LAW 104-127—APR. 4, 1996 
than voting on a grant, loan, contract, agreement, budget, or 
annual strategic plan. 
"(h) CONSULTATION.—To carry out this section, the Board may 
consult with— 
"(1) State departments of agriculture; 
"(2) Federal departments and agencies; 
"(3) nonprofit development corporations; 
"(4) colleges and universities; 
"(5) banking and other credit-related agencies; 
"(6) agriculture and agribusiness organizations; and 
"(7) regional planning and development organizations. 
"(i) OVERSIGHT.— 
"(1) IN GENERAL.—The Secretary shall review and monitor 
compliance by the Board and the Center with this section. 
"(2) SANCTIONS.—If, following notice and opportunity for 
a hearing, the Secretary finds that the Board or the Center 
is not in compliance with this section, the Secretary may— 
"(A) cease making deposits to the Fund; 
"(B) suspend the authority of the Center to withdraw 
funds from the Fund; or 
"(C) impose other appropriate sanctions, including 
recoupment of money improperly expended for purposes 
prohibited or not authorized by this Act and disqualification 
from receipt of financial assistance under this section. 
"(3) 
RESCISSION 
OF 
SANCTIONS.—The Secretary 
shall 
rescind sanctions imposed under paragraph (2) on a finding 
by the Secretary that there is no longer any failure by the 
Board or the Center to comply with this section or that the 
noncompliance will be promptly corrected.". 
SEC. 759A. COOPERATIVE AGREEMENTS. 
Section 607(b) of the Rural Development Act of 1972 (7 U.S.C. 
2204b(b)) is amended by striking paragraph (4) and inserting the 
following: 
"(4) COOPERATIVE AGREEMENTS.— 
"(A) IN GENERAL.—Notwithstanding chapter 63 of title 
31, United States Code, the Secretary may enter into 
cooperative agreements with other Federal agencies. State 
and local governments, and any other organization or 
individual to improve the coordination and effectiveness 
of Federal programs, services, and actions affecting rural 
areas, including the establishment and financing of inter-
agency groups, if the Secretary determines that the objec-
tives of the agreement will serve the mutual interest of 
the parties in rural development activities. 
"(B) COOPERATORS.—Each cooperator, including each 
Federal agency, to the extent that funds are otherwise 
available, may participate in any cooperative agreement 
or working group established pursuant to this paragraph 
by contributing funds or other resources to the Secretary 
to carry out the agreement or functions of the group.". 
SEC. 759B. ELIGIBILITY FOR GRANTS TO BROADCASTING SYSTEMS. 
Section 310B(f) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1932(f)) (as redesignated by section 747(a)(6)) 
is amended by striking "SYSTEMS.—The" and inserting "SYSTEMS.— 
"(1) DEFINITION OF STATEWIDE.—In this subsection, the 
term 'statewide' means having a coverage area of not less 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1139 
than 90 percent of the population of a State and not less 
than 80 percent of the rural land area of the State (as deter-
mined by the Secretary). 
"(2) GRANTS.—The". 
CHAPTER 
2—RURAL 
COMMUNITY 
ADVANCEMENT 
PROGRAM 
SEC. 761. RURAL COMMUNITY ADVANCEMENT PROGRAM. 
The Consolidated Farm and Rural Development Act (7 U.S.C. 
1921 et seq.) is amended by adding at the end the following: 
"Subtitle E—Rural Community 
Advancement Program 
"SEC. 381A. DEFINITIONS. 
"In this subtitle: 
"(1) RURAL AND RURAL AREA.—The terms 'rural' and 'rural 
area' mean, subject to section 306(a)(7), a city, town, or unincor-
porated area that has a population of 50,000 inhabitants or 
less, other than an urbanized area immediately adjacent to 
a city, town, or unincorporated area that has a population 
in excess of 50,000 inhabitants. 
"(2) STATE.—The term 'State' means each of the 50 States, 
the District of Columbia, the Commonwealth of Puerto Rico, 
Guam, the Virgin Islands of the United States, American 
Samoa, the Commonwealth of the Northern Mariana Islands, 
the Trust Territory of the Pacific Islands, and the Federated 
States of Micronesia. 
"(3) STATE DIRECTOR.—The term 'State director' means, 
with respect to a State, the Director of the Rural Economic 
and Community Development State Office. 
"SEC. 381B. ESTABLISHMENT. 
"The Secretary shall establish a rural community advancement 
program to provide grants, loans, loan guarantees, and other assist-
ance to meet the rural development needs of local communities 
in States and federally recognized Indian tribes. 
"SEC. 381C. NATIONAL OBJECTIVES. 
"The national objectives of the program established under this 
subtitle shall be to— 
"(1) promote strategic development activities and collabo-
rative efforts by State and local communities, and federally 
recognized Indian tribes, to maximize the impact of Federal 
assistance; 
"(2) optimize the use of resources; 
"(3) provide assistance in a manner that reflects the 
complexity of rural needs, including the needs for business 
development, health care, education, infrastructure, cultural 
resources, the environment, and housing; 
"(4) advance activities that empower, and build the capacity 
of, State and local communities to design unique responses 
to the special needs of the State and local communities, and 
federally recognized Indian tribes, for rural development assist-
ance; and 
7 u s e 2009. 
7 u s e 2009a. 
7 u s e 2009b. 
110 STAT. 1140 
PUBLIC LAW 104-127—APR. 4, 1996 
"(5) adopt flexible and innovative approaches to solving 
rural development problems. 
7 u s e 2009c. 
"SEC. 381D. STRATEGIC PLANS. 
"(a) IN GENERAL.—The Secretary shall direct each of the Direc-
tors of Rural Economic and Community Development State Offices 
to prepare a strategic plan— 
"(1) for each State for the delivery of assistance under 
this subtitle in the State; and 
"(2) for each federally recognized Indian tribe for the deliv-
ery of assistance under this subtitle to the Indian tribe. 
"(b) ASSISTANCE.— 
"(1) IN GENERAL.—Financial assistance for rural develop-
ment provided under this subtitle for a State or a federally 
recognized Indian tribe shall be used only for orderly commu-
nity development that is consistent with the strategic plan 
of the State or Indian tribe. 
"(2) RURAL AREA.—Assistance under this subtitle may only 
be provided in a rural area. 
"(3) SMALL COMMUNITIES.—In carrying out this subtitle 
in a State, the Secretary shall give priority to communities 
with the smallest populations and lowest per capita income. 
"(c) REVIEW.—The Secretary shall review the strategic plan 
of each State and federally recognized Indian tribe not later than 
60 days after receiving the plan, and at least once every 5 years 
thereafter. 
"(d) CONTENTS.—A strategic plan of a State or federally recog-
nized Indian tribe under this section shall be a plan that— 
"(1) coordinates economic, human, and community develop-
ment plans and related activities proposed for an affected area; 
"(2) provides that the State or federally recognized Indian 
tribe, as appropriate, and an affected community (including 
local institutions and organizations that have contributed to 
the planning process) shall act as full partners in the process 
of developing and implementing the plan; 
"(3) identifies goals, methods, and benchmarks for measur-
ing the success of carrying out the plan and how the plan 
relates to local or regional ecosystems; 
"(4) in the case of a State, provides for the involvement, 
in the preparation of the plan, of State, local, private, and 
public persons, State rural development councils, federally rec-
ognized Indian tribes in the State, and community-based 
organizations; 
"(5) identifies the amount and source of Federal and non-
Federal resources that are available for carrying out the plan; 
and 
"(6) includes such other information as may be required 
by the Secretary. 
7USC2009d. 
"SEC. 381E. RURAL DEVELOPMENT TRUST FUND. 
"(a) ESTABLISHMENT.—There is established in the Treasury of 
the United States a trust fund which shall be known as the Rural 
Development Trust Fund (in this subtitle referred to as the Trust 
Fund'). 
"(b) ACCOUNTS.—There are established in the Trust Fund the 
following accounts: 
"(1) The rural community facilities account. 
"(2) The rural utilities account. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1141 
"(3) The rural business and cooperative development 
account. 
"(4) The national reserve account. 
"(5) The federally recognized Indian tribe account. 
"(c) DEPOSITS INTO ACCOUNTS.—Notwithstanding any other 
provision of law, each fiscal year— 
"(1) all amounts made available to carry out the authorities 
described in subsection (d)(1) for the fiscal year shall be depos-
ited into the rural community facilities account of the Trust 
Fund; 
"(2) all amounts made available to carry out the authorities 
described in subsection (d)(2) for the fiscal year shall be depos-
ited into the rural utilities account of the Trust Fund; and 
"(3) all amounts made available to carry out the authorities 
described in subsection (d)(3) for the fiscal year shall be depos-
ited into the rural business and cooperative development 
account of the Trust Fund. 
"(d) FUNCTION CATEGORIES.—The function categories described 
in this subsection are the following: 
"(1) RURAL COMMUNITY FACILITIES.—The rural community 
development category consists of all amounts made available 
for— 
"(A) community facility direct and guaranteed loans 
under section 306(a)(1); or 
"(B) community facility grants under section 306(a)(19). 
"(2) RURAL UTILITIES.—The rural utilities category consists 
of all amounts made available for— 
"(A) water or waste disposal grants or direct or guaran-
teed loans under paragraph (1) or (2) of section 306(a); 
"(B) rural water or wastewater technical assistance 
and training grants under section 306(a)(14); 
"(C) emergency community water assistance greints 
under section 306A; or 
"(D) solid waste management grants under section 
310B(b). 
"(3) RURAL BUSINESS AND COOPERATIVE DEVELOPMENT.— 
The rural business and cooperative development category con-
sists of all amounts made available for— 
"(A) rural business opportunity grants under section 
306(a)(ll)(A); 
"(B) business and industry guaranteed loans under 
section 310B(a)(l); or 
"(C) rural business enterprise grants or rural edu-
cational network grants under section 310B(c). 
"(e) NATIONAL RESER^^ ACCOUNT.— 
"(1) TRANSFERS INTO ACCOUNT .— 
"(A) INITIAL TRANSFER.—Each fiscal year, the Secretary 
shall transfer to the national reserve account of the Trust 
Fund from each account specified in subsection (c) not 
more than the applicable percentage of the amount depos-
ited in each such account for the fiscal year under sub-
section (c). 
"(B) 
REPOOLING OF UNOBLIGATED FUNDS ALLOCATED 
AMONG THE STATES.—Not earlier than July 15 of each 
fiscal year, the Secretary shall transfer to the national 
reserve account fi'om each account specified in subsection 
(c) any amount in the account that is allocated for any 
110 STAT. 1142 
PUBLIC LAW 104-127—APR. 4, 1996 
State, and has not been obligated by the State director 
or obligated for specific approved projects in the State. 
"(2) USE.—The Secretary may use amounts in the national 
reserve account of the Trust Fund, pursuant to any authority 
described in subsection (d)— 
"(A) in the case of a fiscal year other than fiscal year 
2001 or 2002— 
"(i) to meet situations of exceptional need; 
"(ii) to meet emergency situations; or 
"(iii) to provide funds to entities whose applications 
for funds provided under this subtitle have been 
approved and who have not received funds sufficient 
to meet the needs of the projects described in the 
applications; or 
"(B) in the case of fiscal years 2001 and 2002— 
"(i) to meet situations of exceptional need; or 
"(ii) to meet emergency situations. 
"(3) APPLICABLE PERCENTAGE DEFINED.—In paragraph (1), 
the term 'applicable percentage' means, with respect to a fiscal 
year— 
"(A) 15 percent for fiscal year 1997; 
"(B) 12.5 percent for fiscal year 1998; 
"(C) 10 percent for fiscal year 1999; 
"(D) 7.5 percent for fiscal year 2000; 
"(E) 5 percent for fiscal year 2001; and 
"(F) 5 percent for fiscal year 2002. 
"(f) FEDERALLY RECOGNIZED INDIAN TRIBE ACCOUNT.— 
"(1) TRANSFERS INTO ACCOUNT.—Each fiscal year, the Sec-
retary shall transfer to the federally recognized Indian tribe 
account of the Trust Fund 3 percent of the amount deposited 
into the Trust Fund for the fiscal year under subsection (d). 
"(2) USE OF FUNDS.—The Secretary shall make available 
to federally recognized Indian tribes the amounts in the feder-
ally recognized Indian tribe account for use pursuant to any 
authority described in subsection (d). 
"(g) ALLOCATION AMONG STATES.—The Secretary shall allocate 
the amounts in each account specified in subsection (c) among 
the States in a fair, reasonable, and appropriate manner that takes 
into consideration rural population, levels of income, unemployment, 
and other relevant factors, as determined by the Secretary. 
"(h) AVAILABILITY OF FUNDS ALLOCATED FOR STATES.—The Sec-
retary shall make available to each State the total amount allocated 
for the State under subsection (g) of this section that remains 
after appl3dng section 38IG. 
7 u s e 2009e. 
"SEC. 381F. TRANSFERS OF FUNDS. 
"(a) GENERAL AUTHORITY.—Subject to subsection (b) of this 
section, the State Director of any State may, during any fiscal 
year, transfer from each account specified in section 381E(c) a 
total of not more than 25 percent of the amount in the account 
that is allocated for the State for the fiscal year to any other 
account in which amounts are allocated for the State for the fiscal 
year. 
"(b) LIMITATION.—Except as provided in subsection (c) of this 
section, a transfer otherwise authorized by subsection (a) of this 
section to be made during a fiscal year may not be made to the 
extent that the sum of the amount to be transferred and all amounts 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1143 
so transferred by State directors under subsection (a) of this section 
during the fiscal year exceeds 10 percent of the total amount made 
available to carry out the authorities described in section 381E(d) 
for the fiscal year. 
"(c) EXCEPTIONS.—Subsections (a) and (b) shall not apply to 
a transfer of funds by a State director if the State director certifies 
to the Secretary that— 
"(1) there is an approved application for a project in the 
function category to which the funds are to be transferred 
but funds are not available for the project in the function 
category; and 
"(2)(A) there is no such approved application in the function 
category from which the funds are to be transferred; or 
"(B) the community that would benefit from the project 
has a smaller population and a lesser per capita income than 
any community that would benefit from a project in the function 
category from which the funds are to be transferred. 
"SEC. 381G. GRANTS TO STATES. 
7 USC 2009f. 
"(a) SIMPLE GRANTS.— 
"(1) MANDATORY GRANT.—The Secretary shall make a grant 
to any eligible State for any fiscal year for which the State 
requests a grant under this section in an amount equal to 
5 percent of the total amount allocated for the State under 
section 381E(g). 
"(2) PERMISSIVE GRANT.—Before July 15 of each fiscal year, 
the Secretary may make a grant to any State to defi'ay the 
cost of any subsidy associated with a guarantee provided by 
£in eligible public entity of the State under section 381H in 
an amount that does not exceed 5 percent of the total amount 
allocated for the State under section 381E(g). 
"(3) SOURCE OF FUNDS.—The Secretary shall make grants 
to a State under paragraphs (1) and (2) fi-om amounts allocated 
for the State in the accounts specified in section 381E(c), by 
reducing each such allocated amount by the same percentage. 
"(b) MATCHING GRANTS.— 
"(1) IN GENERAL.—Subject to paragraph (2), the Secretary 
shall make a grant to any eligible State for any fiscal year 
for which the State requests a grant under this section in 
an amount equal to 5 percent of the amount allocated for 
the State for the fiscal year under section 381E(h). 
"(2) ELIGIBILITY.—A State shall be eligible for a grant 
under paragraph (1) if the State makes commitments to the 
Secretary to— 
"(A) expend fi-om non-Federal sources in accordance 
with subsection (c) an amount that is not less than 200 
percent of the amount of the grant; and 
"(B) maintain the amounts paid to the State under 
this subsection and the amount referred to in subparagraph 
(A) in an account separate from all other State funds 
until expended in accordance with subsection (c). 
"(3) SOURCE OF FUNDS.—If the Secretary makes a grant 
under paragraph (1) before July 15 of the fiscal year, the 
grant shall be made from amounts allocated for the State 
in the accounts specified in section 381E(c) for the fiscal year, 
by reducing each allocated amount by the same percentage. 
110 STAT. 1144 
PUBLIC LAW 104-127—APR. 4, 1996 
"(c) USE OF FUNDS.—A State to which funds are provided 
under this section shall use the funds in rural areas for any activity 
authorized under the authorities described in section 381E(d) in 
accordance with the State strategic plan referred to in section 
381D. 
"(d) MAINTENANCE OF EFFORT.—The State shall provide assur-
ances to the Secretary that funds provided to the State under 
this section will be used only to supplement, not to supplant, 
the amount of Federal, State, and local funds otherwise expended 
for rural development assistance in the State. 
"(e) APPEALS.—The Secretary shall provide to a State an oppor-
tunity to appeal any action taken with respect to the State under 
this section. 
"(f) ADMINISTRATIVE COSTS.—Federal funds shall not be used 
for any administrative costs incurred by a State in carrying out 
this subtitle. 
"(g) EXPENDITURE OF FUNDS BY STATE.— 
"(1) IN GENERAL.—Payments to a State from a grant under 
this section for a fiscal year shall be obligated by the State 
in the fiscal year or in the succeeding fiscal year. A State 
shall obligate funds under this section to provide assistance 
to rural areas. 
"(2) FAILURE TO OBLIGATE.—If a State fails to obligate 
payments in accordance with paragraph (1), the Secretary shall 
make an equal reduction in the amount of payments provided 
to the State under this section for the immediately succeeding 
fiscal year. 
"(3) NONCOMPLIANCE.— 
"(A) REVIEW.—The Secretary shall review and monitor 
State compliance with this section. 
"(B) PENALTY.—If the Secretary finds that there has 
been misuse of grant funds provided under this section, 
or noncompliance with any of the terms and conditions 
of a grant, after reasonable notice and opportunity for 
a hearing— 
"(i) the Secretary shall notify the State of the 
finding; and 
"(ii) no further pajonents to the State shall be 
made with respect to the programs funded under this 
section until the Secretary is satisfied that there is 
no longer any failure to comply or that the noncompli-
ance will be promptly corrected. 
"(C) OTHER SANCTIONS.—In the case of a finding of 
noncompliance made pursuant to subparagraph (B), the 
Secretary may, in addition to, or in lieu of, imposing the 
sanctions described in subparagraph (B), impose other 
appropriate sanctions, including recoupment of money 
improperly expended for purposes prohibited or not author-
ized by this section and disqualification from the receipt 
of financial assistance under this section. 
"(h) No ENTITLEMENT TO CONTRACT, GRANT, OR ASSISTANCE.— 
Nothing in this subtitle— 
"(1) entitles any person to assistance or a contract or grant; 
or 
"(2) limits the right of a State to impose additional limita-
tions or conditions on assistance or a contract or grant under 
this section. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1145 
"SEC. 381H. GUARANTEE AND COMMITMENT TO GUARANTEE LOANS. 
7 USC 2009g. 
"(a) DEFINITION OF ELIGIBLE PUBLIC ENTITY.—In this section, 
the term 'eUgible pubHc entity* means any unit of general local 
government. 
"(b) GUARANTEE AND COMMITMENT.—The Secretary, on such 
terms and conditions as the Secretary may prescribe, may guarantee 
and make commitments to guarantee notes or other obligations 
issued by eligible public entities, or by public agencies designated 
by the eligible public entities, for the purposes of financing rural 
development activities authorized and funded under section 38IG. 
"(c) LIMITATION.—The Secretary may not make a guarantee 
or commitment to guarantee with respect to a note or other obliga-
tion if the total amount of outstanding notes or obligations guaran-
teed under this section (excluding any amount repaid under the 
contract entered into under subsection (e)(1)(A)) for issuers in the 
State would exceed an amount equal to 5 times the sum of the 
total amount of grants made to the State under section 381G. 
"(d) PAYMENT OF PRINCIPAL, INTEREST, AND COSTS.—Notwith-
standing any other provision of this subtitle, a State to which 
a grant is made under section 381G may use the grant (including 
program income derived from the grant) to pay principal and 
interest due (including such servicing, underwriting, or other costs 
as may be specified in regulations of the Secretary) on any note 
or other obligation guaranteed under this section. 
"(e) REPAYMENT CONTRACT; SECURITY.— 
"(1) IN GENERAL.—To ensure the repayment of notes or 
other obligations and charges incurred under this section and 
as a condition for receiving the guarantees, the Secretary shall 
require the issuer to— 
"(A) enter into a contract, in a form acceptable to 
the Secretary, for repayment of notes or other obligations 
guaranteed under this section; 
"(B) pledge any grant for which the issuer may become 
eligible under this subtitle; and 
"(C) furnish, at the discretion of the Secretary, such 
other security as may be considered appropriate by the 
Secretary in making the guarantees. 
"(2) SECURITY.—To assist in ensuring the repayment of 
notes or other obligations and charges incurred under this 
section, a State shall pledge any grant for which the State 
may become eligible under this subtitle as security for notes 
or other obligations and charges issued under this section by 
any eligible public entity in the State. 
"(f) PLEDGED GRANTS FOR REPAYMENTS.—Notwithstanding any 
other provision of this subtitle, the Secretary may apply grants 
pledged pursuant to paragraphs (1)(B) and (2) of subsection (e) 
to any repa3nnents due the United States as a result of the guaran-
tees. 
"(g) OUTSTANDING OBLIGATIONS.—The total amount of outstand-
ing obligations guaranteed on a cumulative basis by the Secretary 
pursuant to subsection (b) shall not at any time exceed such amount 
as may be authorized to be appropriated for such purpose for 
any fiscal year. 
"(h) PURCHASE OF GUARANTEED OBLIGATIONS BY FEDERAL 
FINANCING BANK.—Notes or other obligations guaranteed under 
this section may not be purchased by the Federal Financing Bank. 
110 STAT. 1146 
PUBLIC LAW 104-127—APR. 4, 1996 
"(i) FULL FAITH AND CREDIT.—The full faith and credit of the 
United States is pledged to the payment of all guarantees made 
under this section. Ajiy such guarantee made by 'the Secretary 
shall be conclusive evidence of the eligibility of the obligations 
for the guarantee with respect to principal and interest. The validity 
of the guarantee shall be incontestable in the hands of a holder 
of the guaranteed obligations. 
7 use 2009h. 
"SEC. 3811. LOCAL INVOLVEMENT. 
"An application for assistance under this subtitle shall include 
evidence of significant community support for the project for which 
the assistance is requested. In the case of assistance for a commu-
nity facilities or infrastructure project, the evidence shall be in 
the form of a certification of support for the project from each 
affected general purpose local government. 
7 use 2009i. 
"SEC. 381J. INTERSTATE COLLABORATION. 
"The Secretary shall permit the establishment of voluntary 
pooling arrangements among States, and regional fund-sharing 
agreements, to carry out projects receiving assistance under this 
subtitle. 
7 use 2009J. 
"SEC. 381K. ANNUAL REPORT. 
"(a) IN GENERAL.—The Secretary, in collaboration with State, 
local, public, and private entities, State rural development councils, 
and community-based organizations, shall prepare an annual report 
that contains evaluations, assessments, and performance outcomes 
concerning the rural community advancement programs carried 
out under this subtitle. 
"(b) SUBMISSION.—Not later than March 1 of each year, the 
Secretary shall— 
"(1) submit the report required by subsection (a) to Con-
gress and the chief executives of the States participating in 
the program established under this subtitle; and 
"(2) make the report available to State and local partici-
pants. 
7 use 2009k. 
"SEC. 381L. RURAL DEVELOPMENT INTERAGENCY WORKING GROUP. 
"(a) IN GENERAL.—The Secretary shall provide leadership 
within the Executive branch for, and assume responsibility for, 
establishing an interagency working group chaired by the Secretary. 
"(b) DUTIES.—The working group shall establish policy for, 
coordinate, make recommendations with respect to, and evaluate 
the performance of, all Federal rural development efforts. 
7 use 2009/. 
"SEC. 381M. DUTIES OF RURAL ECONOMIC AND COMMUNITY DEVELOP-
MENT STATE OFFICES. 
"In carrying out this subtitle, the Director of a Rural Economic 
and Community Development State Office shall— 
"(1) to the maximum extent practicable, ensure that the 
State strategic plan referred to in section 38ID is implemented; 
"(2) coordinate community development objectives within 
the State; 
"(3) establish links between local. State, and field office 
program administrators of the Department of Agriculture; 
"(4) ensure that recipient communities comply with 
applicable Federal and State laws and requirements; and 
: i % i t - .' 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1147 
"(5) integrate State development programs with assistance 
under this subtitle. 
"SEC. 381N. ELECTRONIC TRANSFER. 
7 USC 2009m. 
"The Secretary shall transfer funds in accordance with this 
subtitle through electronic transfer as soon as practicable after 
the date of enactment of this subtitle. 
"SEC. 3810. RURAL VENTLTRE CAPITAL DEMONSTRATION PROGRAM. 
7 USC 2009n 
"(a) IN GENERAL.—The Secretary may designate for each fiscal 
year up to 10 community development venture capital organizations 
to demonstrate the utility of guarantees to attract increased private 
investment in rural private business enterprises. 
"(b) RURAL BUSINESS INVESTMENT POOL.— 
"(1) ESTABLISHMENT.—To be eligible to participate in the 
demonstration program, an organization referred to in sub-
section (a) shall establish a rural business private investment 
pool (referred to in this subsection as a 'pool') for the purpose 
of making equity investments in rural private business enter-
prises. 
"(2) GUARANTEE.—From amounts in the national reserve 
account of the Trust Fund, the Secretary shall guarantee the 
funds in a pool against loss, except that the guarantee shall 
not exceed an amount equal to 30 percent of the total funds 
in the pool. 
"(3) AMOUNT.—The Secretary shall issue guarantees cover-
ing not more than $15,000,000 of contingent liabilities for each 
of fiscal years 1996 through 2002. 
"(4) TERM.—The term of a guarantee provided under this 
subsection shall not exceed 10 years. 
"(5) SUBMISSION OF PLAN.—TO be ehgible to participate 
in the demonstration program, an organization referred to in 
subsection (a) shall svibmit a plan that describes— 
"(A) potential sources and uses of the pool to be estab-
lished by the organization; 
"(B) the utility of the guarantee authority in attracting 
capital for the pool; and 
"(C) on selection, mechanisms for notif5dng State, local, 
and private nonprofit business development organizations 
and businesses of the existence of the pool. 
"(6) COMPETITION.— 
"(A) IN GENERAL.—The Secretary shall conduct a com-
petition for the designation and establishment of pools. 
"(B) PRIORITY.—In conducting the competition, the Sec-
retary shall give priority to organizations that— 
"(i) have a demonstrated record of performance, 
or have a board and executive director with experience, 
in venture capital, small business equity investment, 
or community development finance; 
"(ii) propose to serve low-income communities; 
"(iii) propose to maintain an average investment 
of not more than $500,000 from the pool of the 
organization; 
"(iv) invest funds statewide or in a multicounty 
region; and 
"(v) propose to target job opportunities resulting 
from the investments primarily to economically dis-
110 STAT. 1148 
PUBLIC LAW 104-127—APR. 4, 1996 
advantaged individuals, as determined by the Sec-
retary. 
"(C) GEOGRAPHIC 
DIVERSITY.—To the extent prac-
ticable, the Secretary shall designate organizations in 
diverse geographic areas.". 
7 use 2204b 
SEC. 762. SIMPLIFIED, UNIFORM APPLICATION FOR ASSISTANCE FROM 
note. 
ALL FEDERAL RURAL DEVELOPMENT PROGRAMS. 
Not later than 1 year after the date of enactment of this 
Act, the Secretary of Agriculture shall develop a streamlined, sim-
plified, and uniform application which shall be used in applying 
for assistance under all of the following: 
(1) Sections 304(b), 306, 306A, 306C, 306D, 310B, and 
375 and subtitle E of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1924(b), 1926, 1926a, 1926c, 1926d, and 
1932). 
(2) Subtitle G of title XVI and sections 2281, 2333, and 
2381 of the Food, Agriculture, Conservation, and Trade Act 
of 1990 (7 U.S.C. 5901-5908, 5177a, 950aaa-2, and 3125b). 
(3) Subtitle C of title IX of the Food, Agriculture, Conserva-
tion, and Trade Act Amendments of 1991 (Public Law 102-
237: 7 U.S.C. 5930 note). 
(4) Section 1323(b) of the Food Security Act of 1985 (PubHc 
Law 99-198; 7 U.S.C. 1932 note). 
(5) Title V and section 603(c) of the Rural Development 
Act of 1972 (7 U.S.C. 2661-2669 and 2204a(c)). 
(6) Sections 5 and 311 and title IV of the Rural Electrifica-
tion Act of 1936 (7 U.S.C. 905, 940a, and 941-950b). 
SEC. 763. COMMUNITY FACILITIES GRANT PROGRAM. 
Section 306(a) of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1926(a)) (as amended by section 741(a)(5)) 
is amended by adding at the end the following: 
"(19) COMMUNITY FACILITIES GRANT PROGRAM.— 
"(A) IN GENERAL.—The Secretary may make grants, 
in a total amount not to exceed $10,000,000 for any fiscal 
year, to associations, units of general local government, 
nonprofit corporations, and federally recognized Indian 
tribes to provide the Federal share of the cost of developing 
specific essential community facilities in rural areas. 
"(B) FEDERAL SHARE.— 
"(i) IN GENERAL.—Except as provided in clauses 
(ii) and (iii), the Secretary shall, by regulation, estab-
lish the amount of the Federal share of the cost of 
the facility under this paragraph. 
"(ii) MAXIMUM AMOUNT.—The amount of a grant 
provided under this paragraph for a facility shall not 
exceed 75 percent of the cost of developing the facility, 
"(iii) GRADUATED SCALE.—The Secretary shall pro-
vide for a graduated scale for the amount of the Federal 
share provided under this paragraph, with higher Fed-
eral shares for facilities in communities that have lower 
community population and income levels, as deter-
mined by the Secretary.". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1149 
Subtitle C—^Amendments to the Rural 
Electrification Act of 1936 
SEC. 771. PURPOSES; INVESTIGATIONS AND REPORTS. 
Section 2 of the Rural Electrification Act of 1936 (7 U.S.C. 
902) is amended— 
(1) by striking "SEC. 2. (a) The Secretary of Agriculture 
is" and inserting the following: 
"SEC. 2. GENERAL AUTHORITY OF THE SECRETARY OF AGRICULTURE. 
"(a) LOANS.—The Secretary of Agriculture (referred to in this 
Act as the 'Secretary*) is"; 
(2) in subsection (a)— 
(A) by striking "and the furnishing" the first place 
it appears and all that follows through "central station 
service"; and 
(B) by striking "systems; to make" and all that follows 
and inserting "systems."; and 
(3) by striking subsection (b) and inserting the following: 
"(b) INVESTIGATIONS AND REPORTS.—The Secretary may make, 
or cause to be made, studies, investigations, and reports regarding 
matters, including financial, technological, and regulatory matters, 
affecting the condition and progress of electric, telecommunications, 
and economic development in rural areas, and publish and dissemi-
nate information with respect to the matters.". 
SEC. 772. AUTHORIZATION OF APPROPRIATIONS. 
(a) IN GENERAL.—Section 3 of the Rural Electrification Act 
of 1936 (7 U.S.C. 903) is amended to read as follows: 
"SEC. 3. AUTHORIZATION OF APPROPRIATIONS. 
"There are authorized to be appropriated such sums as are 
necessary to carry out this Act.". 
(b) CONFORMING AMENDMENTS.— 
(1) Section 301(a) of the Rural Electrification Act of 1936 
(7 U.S.C. 931(a)) is amended— 
(A) by striking "(a)" the first place the term appears; 
and 
(B) in paragraph (3), by striking "notwithstanding sec-
tion 3(a) of title I,". 
(2) Section 302(b)(2) of the Rural Electrification Act of 
1936 (7 U.S.C. 932(b)(2)) is amended by striking "pursuant 
to section 3(a) of this Act". 
(3) The last sentence of section 406(a) of the Rural Elec-
trification Act of 1936 (7 U.S.C. 946(a)) is amended by striking 
"pursuant to section 3(a) of this Act". 
SEC. 773. LOANS FOR ELECTRICAL PLANTS AND TRANSMISSION LINES. 
Section 4 of the Rural Electrification Act of 1936 (7 U.S.C. 
904) is amended— 
(1) in the first sentence— 
(A) by striking "for the furnishing of and all that 
follows through "central station service and"; and 
(B) by striking "the provisions of sections 3(d) and 
3(e) but without regard to the 25 per centum limitation 
therein contained," and inserting "section 3,"; 
110 STAT. 1150 
PUBLIC LAW 104-127—APR. 4, 1996 
7 use 917. 
Regulations. 
(2) in the second sentence, by striking ": Provided 
further, 
That all" and all tha': follows through "loan: And 
provided 
further, That" and insei'ting ", except that"; and 
(3) in the third sentence, by striking "and section 5". 
SEC. 774. LOANS FOR ELECTRICAL AND PLUMBING EQUIPMENT. 
(a) IN GENERAL.—Section 5 of the Rural Electrification Act 
of 1936 (7 U.S.C. 905) is repealed. 
(b) CONFORMING AMENDMENTS.—Section 12(a) of the Rural 
Electrification Act of 1936 (7 U.S.C. 912(a)) is amended— 
(1) by striking ": Provided, however, That" and inserting 
", except that,"; and 
(2) by striking ", and with respect to any loan made under 
section 5," and all that follows through "section 3". 
SEC. 775. TESTIMONY ON BUDGET REQUESTS. 
Section 6 of the Rural Electrification Act of 1936 (7 U.S.C. 
906) is amended by striking the second sentence. 
SEC. 
776. 
TRANSFER OF 
FUNCTIONS 
OF 
ADMINISTRATION CREATED 
BY 
EXECUTIVE 
ORDER. 
Section 8 of the Rural Electrification Act of 1936 (7 U.S.C. 
908) is repealed. 
SEC. 777. ANNUAL REPORT. 
Section 10 of the Rural Electrification Act of 1936 (7 U.S.C. 
910) is repealed. 
SEC. 778. PROHIBITION ON RESTRICTING WATER AND WASTE FACILITY 
SERVICES TO ELECTRIC CUSTOMERS. 
The Rural Electrification Act of 1936 is amended by inserting 
after section 16 (7 U.S.C. 916) the following: 
"SEC. 17. PROHIBITION ON RESTRICTING WATER AND WASTE FACILITY 
SERVICES TO ELECTRIC CUSTOMERS. 
"(a) PROHIBITION.—^Assistance under any rural development 
program administered by the Secretary or any agency of the Depart-
ment of Agriculture shall not be conditioned on any requirement 
that the recipient of the assistance accept or receive electric service 
fi*om any particular utility, supplier, or cooperative. 
"(b) ENSURING COMPLIANCE.—The Secretary shall establish, by 
regulation, adequate safeguards to ensure that assistance under 
any rural development program is not subject to such a condition. 
The safeguards shall include periodic certifications and audits, and 
appropriate measures and sanctions against any person violating, 
or attempting to violate subsection (a). 
"(c) DEFINITION OF RURAL DEVELOPMENT PROGRAMS.—In this 
section, the term 'rural development program' means the following: 
"(1) Sections 304(b), 306, 306A, 306C, 306D, 310B, and 
375 and subtitle E of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1924(b), 1926, 1926a, 1926c, 1926d, and 
1932). 
"(2) Subtitle G of title XVI and sections 2281, 2333, and 
2381 of the Food, Agriculture, Conservation, and Trade Act 
of 1990 (7 U.S.C. 5901-5908, 5177a, 950aaa-2, and 3125b). 
"(3) Subtitle C of title IX of the Food, Agriculture, Conserva-
tion, and Trade Act Amendments of 1991 (Public Law 102-
237; 7 U.S.C. 5930 note). 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1151 
"(4) Section 1323(b) of the Food Security Act of 1985 (Public 
Law 99-198; 7 U.S.C. 1932 note). 
"(5) Title V and section 603(c) of the Rural Development 
Act of 1972 (7 U.S.C. 2661-2669 and 2204a(c)). 
"(6) Sections 5 and 311 and title IV of this Act (7 U.S.C. 
905, 940a, and 941-950b). 
"(d) REGULATIONS.—Not later than 60 days after the date of 
enactment of the Federal Agriculture Improvement and Reform 
Act of 1996, the Secretary shall issue final regulations to ensure 
compliance with subsection (a).". 
SEC. 779. TELEPHONE LOAN TERMS AND CONDITIONS. 
Section 309 of the Rural Electrification Act of 1936 (7 U.S.C. 
939) is amended— 
(1) in subsection (a), by striking "(a) IN GENERAL.—"; and 
(2) by striking subsection (b). 
SEC. 780. PRIVATIZATION PROGRAM. 
Section 311 of the Rural Electrification Act of 1936 (7 U.S.C. 
940a) is repealed. 
SEC. 781. RURAL BUSINESS INCUBATOR FUND. 
(a) IN GENERAL.—Section 502 of the Rural Electrification Act 
of 1936 (7 U.S.C. 950aa-l) is repealed. 
(b) CONFORMING AMENDMENTS.—Section 501 of the Rural Elec-
trification Act of 1936 (7 U.S.C. 950aa) is amended— 
(1) in paragraph (5), by inserting "and" at the end; 
(2) in paragraph (6), by striking "; and" at the end and 
inserting a period; and 
(3) by striking paragraph (7). 
Subtitle D—^Miscellaneous Rural 
Development Provisions 
SEC. 791. INTEREST RATE FORMULA. 
(a) BANKHEAD-JONES FARM TENANT ACT.—Section 32(e) of the 
Bankhead-Jones Farm Tenant Act (7 U.S.C. 1011) is amended 
by striking the fifth sentence and inserting the following: "A loan 
under this subsection shall be made under a contract that provides, 
under such terms and conditions as the Secretary considers appro-
priate, for the repa3anent of the loan in not more than 30 years, 
with interest at a rate not to exceed the current market yield 
for outstanding municipal obligations with remaining periods to 
maturity comparable to the average maturity for the loan, adjusted 
to the nearest Vs of 1 percent.". 
(b) WATERSHED PROTECTION AND FLOOD PREVENTION ACT.— 
Section 8 of the Watershed Protection and Flood Prevention Act 
(16 U.S.C. 1006a) is amended by striking the second sentence 
and inserting the following: "A loan or advance under this section 
shall be made under a contract or agreement that provides, under 
such terms and conditions as the Secretary considers appropriate, 
for the repayment of the loan or advance in not more than 50 
years fi-om the date when the principal benefits of the works of 
improvement first become available, with interest at a rate not 
to exceed the current market 3aeld for outstanding municipal obliga-
110 STAT. 1152 
PUBLIC LAW 104-127—APR. 4, 1996 
tions with remaining periods to maturity comparable to the average 
maturity for the loan, adjusted to the nearest Vs of 1 percent.". 
SEC. 
792. GRANTS FOR FINANCIALLY STRESSED FARMERS, DIS-
LOCATED FARMERS, AND RURAL FAMILIES. 
(a) IN GENERAL.—Section 502 of the Rural Development Act 
of 1972 (7 U.S.C. 2662) is amended by striking subsection (f). 
(b) CONFORMING AMENDMENTS.— 
(1) Section 2389 of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (PubUc Law 101-624; 7 U.S.C. 2662 
note) is amended by striking subsection (d). 
(2) Section 503(c) of the Rural Development Act of 1972 
(7 U.S.C. 2663(c)) is amended— 
(A) in paragraph (1)— 
(i) by striking "(1)"; 
(ii) by striking "section 502(e)" and all that follows 
through "shall be distributed" and inserting "sub-
sections (e), (h), and (i) of section 502 shall be distrib-
uted"; and 
(iii) by striking "objectives of and all that follows 
through "title" and inserting "objectives of subsections 
(e), (h), and (i) of section 502"; and 
(B) by striking paragraph (2). 
7USC2204f. 
SEC. 793. FUND FOR RURAL AMERICA. 
(a) IN GENERAL.—There is established in the Treasury of the 
United States an account to be known as the Fund for Rural 
America (referred to in this section as the "Account") to provide 
funds for activities described in subsection (c). 
(b) FUNDING.— 
(1) IN GENERAL.—On January 1, 1997, October 1, 1998, 
and October 1, 1999, out of any funds in the Treasury not 
otherwise appropriated, the Secretary of the Treasury shall 
transfer $100,000,000 to the Account. 
(2) ENTITLEMENT.— The Secretary of Agriculture (referred 
to in this section as the "Secretary")— 
(A) shall be entitled to receive the funds transferred 
to the Account under paragraph (1); 
(B) shall accept the funds; and 
(C) shall use the funds to carry out this section. 
(3) PURPOSES.—Subject to subsection (d), of the amounts 
transferred to the Account for a fiscal year, the Secretary 
shall make available— 
(A) for activities described in subsection (c)(1), not less 
than V
a and not more than % of the funds in the Account; 
and 
(B) for activities described in subsection (c)(2), all funds 
in the Account not made available by the Secretary for 
activities described in subsection (c)(1). 
(c) ACTIVITIES.— 
(1) RURAL DEVELOPMENT.— 
(A) IN GENERAL.—The Secretary may use the funds 
in the Account for a rural development activity— 
(i) authorized under the Housing Act of 1949 for— 
(I) direct loans to low-income borrowers under 
section 502 (42 U.S.C. 1472); 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1153 
(II) loans for financial assistance for housing 
for domestic farm laborers under section 514 (42 
U.S.C. 1484); 
(III) financial 
assistance for housing for 
domestic farm laborers under section 516 (42 
U.S.C. 1486); 
(IV) payments for elderly who are not now 
receiving rental assist£ince under section 521 (42 
U.S.C. 1490a); 
(V) grants and contracts for mutual and self-
help housing under section 523(b)(1)(A) (42 U.S.C. 
1490c(b)(l)(A)); or 
(VI) grants for rural housing preservation 
under section 533 (42 U.S.C. 1490m); or 
(ii) conducted under any rural development pro-
gram, including a program authorized under— 
(I) the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1921 et seq.); 
(II) subtitle G of title XVI and title XXIII 
of the Food, Agriculture, Conservation, and Trade 
Act of 1990; 
(III) title V of the Rural Development Act of 
1971 (7 U.S.C. 2661 et seq.); or 
(IV) section 1323(b) of the Food Security Act 
of 1985 (Public Law 99-198; 7 U.S.C. 1932 note). 
(B) LIMITATION ON PROGRAMS FUNDED.—The Secretary 
may not expend funds made available to carry out activities 
described in subparagraph (A) for any activity that did 
not receive api)ropriations for fiscal year 1995. Funds 
expended under this section for any program purpose shall 
be spent in accordance with and subject to the applicable 
program limitations, restrictions, and priorities found in 
the underlying program authority and this Act. 
(C) LIMITATION ON HOUSING ASSISTANCE.—Not more 
than 20 percent of the funds made available to carry out 
activities described in subparagraph (A) shall be made 
available to carry out activities described in subparagraph 
(A)(i). 
(D) DISCLOSURE OF ALLOCATION.—For any fiscal year, 
the Secretary shall not disclose the allocation of funds 
under this section for any activity described in subpara-
graph (A) until the date that is 1 day after the date 
of enactment of legislation authorizing appropriations for 
the Department of Agriculture for any period in the fiscal 
year. 
(2) RESEARCH.— 
(A) IN GENERAL.—The Secretary may use the funds 
in the Account for research, extension, and education grants 
to— 
(i) increase international competitiveness, effi-
ciency, and farm profitability; 
(ii) reduce economic and health risks; 
(iii) conserve and enhance natural resources; 
(iv) develop new crops, new crop uses, and new 
agricultural applications of biotechnology; 
(v) enhance animal agricultural resources; 
(vi) preserve plant and animal germplasm; 
29-194 0-96-38:QL3Partl 
110 STAT. 1154 
PUBLIC LAW 104-127—APR. 4, 1996 
(vii) increase economic opportunities in farming 
and rural communities; and 
(viii) expand locally-owned value-added processing. 
(B) ELIGIBLE GRANTEE.—The Secretary may make a 
grant under this paragraph to— 
(i) a Federal research agency; 
(ii) a national laboratory; 
(iii) a college or university or a research foundation 
maintained by a college or university; or 
(iv) a private research organization with an estab-
lished and demonstrated capacity to perform research 
or technology transfer. 
(C) USE OF GRANT.— 
(i) IN GENERAL.—^A grant made under this para-
graph may be used by a grantee for 1 or more of 
the following uses: 
(I) Outcome-oriented research at the discovery 
end of the spectrum to provide breakthrough 
results. 
(II) Exploratory and advanced development 
and technology with well-identified outcomes. 
(III) A national, regional, or multi-State pro-
gram oriented primarily toward extension pro-
grams and education programs demonstrating and 
supporting the competitiveness of United States 
agriculture. 
(ii) SMALLER INSTITUTIONS.—Of the amounts made 
available for activities described in this paragraph, 
not less than 15 percent shall be awarded to colleges, 
universities, or research foundations eligible for a grant 
under subparagraph (B)(iii) that rank in the lowest 
Vs of such colleges, universities, and foundations on 
the basis of Federal research funds received under 
a provision of law other than this section. 
(D) ADMINISTRATION.— 
(i) PRIORITY.—In administering this paragraph, the 
Secretary shall— 
(I) establish criteria for allocating grants based 
on the priorities in subparagraph (A) and in con-
sultation with the National Agricultural Research, 
Extension, Education, and Economics Advisory 
Board established under section 1408 of the 
National Agricultural Research, Extension, and 
Teaching PoHcy Act of 1977 (7 U.S.C. 3123); 
(II) seek and accept proposals for grants; 
(III) determine the relevance and merit of 
proposals through a system of peer review and 
review by the National Agricultural Research, 
Extension, Education, and Economics Advisory 
Board; and 
(IV) award grants on the basis of merit, qual-
ity, and relevance to advancing the purposes of 
federally supported agricultural research, exten-
sion, and education provided in section 1402 of 
the National Agricultural Research, Extension, 
and Teaching Policy Act of 1977 (7 U.S.C. 3101). 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1155 
(ii) COMPETITIVE BASIS.—A grant under this para-
graph shall be awarded on a competitive basis. 
(iii) TERMS.—^A grsmt under this paragraph shall 
have a term that does not exceed 5 years. 
(iv) MATCHING FUNDS.—As a condition of making 
a grant under this paragraph, the Secretary shall 
require the funding of the grant with equal matching 
funds from a non-Federal source if the grant is— 
(I) for applied research that is commodity-spe-
cific; and 
(II) not of national scope. 
(v) DELEGATION.—^The Secretary shall administer 
this section through the Cooperative State Research, 
Education, and Extension Service of the Department 
of Agriculture. 
(vi) AVAILABILITY OF FUNDS.—Funds shall be avail-
able for obligation under this paragraph for a 2-year 
period. 
(vii) AJDMINISTRATIVE COSTS.—The Secretary 
may 
use not more than 4 percent of the funds made avail-
able for activities described in this paragraph for 
administrative costs incurred by the Secretary in carry-
ing out this paragraph. 
(viii) BUILDINGS.—Funds made available for activi-
ties described in this paragraph shall not be used 
for the construction of a new building or the acquisi-
tion, expansion, remodeling, or alteration of an existing 
building (including site grading and improvement and 
architect fees), 
(d) LIMITATIONS.—Amounts in the Account may not be used 
for an activity described in subsection (c) for a fiscal year if the 
program funding level for the fiscal year for the activity is less 
than 90 percent of the amount appropriated for the activity for 
fiscal year 1996, adjusted for inflation. 
SEC. 794. UNDER SECRETARY OF AGRICULTURE FOR RURAL ECO-
NOMIC ANr> COMMUNITY DEVELOPMENT RENAMED THE 
UNDER SECRETARY OF AGRICULTURE FOR RURAL 
DEVELOPMENT. 
(a) IN GENERAL.—Section 231 of the Department of Agriculture 
Reorganization Act of 1994 (7 U.S.C. 6941) is amended— 
(1) in the section heading, by striking "ECONOMIC AND 
COMMUNITY"; and 
(2) by striking "Economic and Community each place such 
term appears in subsections (a), (b), and (c). 
(b) CONFORMING AMENDMENT.—Section 5314 of title 5, United 
States Code, is amended by striking "Economic and Community". 
110 STAT. 1156 
PUBLIC LAW 104-127—APR. 4, 1996 
TITLE YIII—RESEARCH, EXTENSION, 
AND EDUCATION 
Subtitle A—Modification and Extension of 
Activities Under 1977 Act 
SEC. 801. PURPOSES OF AGRICULTURAL RESEARCH, EXTENSION, AND 
EDUCATION. 
Section 1402 of the National Agricultural Research, Extension, 
and Teaching Policy Act of 1977 (7 U.S.C. 3101) is amended to 
read as follows: 
"SEC. 1402. PURPOSES OF AGRICULTURAL RESEARCH, EXTENSION, 
AND EDUCATION. 
"The purposes of federally supported agricultural research, 
extension, and education are to— 
"(1) enhance the competitiveness of the United States agri-
culture and food industry in an increasingly competitive world 
environment; 
"(2) increase the long-term productivity of the United States 
agriculture and food industry while maintaining and enhancing 
the natural resource base on which rural America and the 
United States agricultural economy depend; 
"(3) develop new uses and new products for agricultural 
commodities, such as alternative fuels, and develop new crops; 
"(4) support agricultural research and extension to promote 
economic opportunity in rural communities and to meet the 
increasing demand for information and technology transfer 
throughout the United States agriculture industry; 
"(5) improve risk management in the United States agri-
culture industry; 
"(6) improve the safe production and processing of, and 
adding of value to. United States food and fiber resources 
using methods that maintain the balance between yield and 
environmental soundness; 
"(7) support higher education in agriculture to give the 
next generation of Americans the knowledge, technology, and 
applications necessary to enhance the competitiveness of United 
States agriculture; and 
"(8) maintain an adequate, nutritious, and safe supply of 
food to meet human nutritional needs and requirements.". 
SEC. 802. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, EDU-
CATION, AND ECONOMICS ADVISORY BOARD. 
(a) IN GENERAL.—Section 1408 of the National Agricultural 
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
3123) is amended to read as follows: 
"SEC. 1408. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, EDU-
CATION, AND ECONOMICS ADVISORY BOARD. 
"(a) ESTABLISHMENT.—The Secretary shall establish within the 
Department of Agriculture a board to be known as the 'National 
Agricultural 
Research, 
Extension, 
Education, 
and 
Economics 
Advisory Board'. 
"(b) MEMBERSHIP.— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1157 
"(1) IN GENERAL.—The Advisory Board shall consist of 30 
members, appointed by the Secretary. 
"(2) SELECTION OF MEMBERS.—The Secretary shall appoint 
members of the Advisory Board from nominations submitted 
by organizations, associations, societies, councils, federations, 
groups, and companies fitting the criteria specified in paragraph 
(3). 
"(3) MEMBERSHIP CATEGORIES.—The Advisory Board shall 
consist of members from each of the following categories: 
"(A) 1 member representing a national farm organiza-
tion. 
"(B) 1 member representing farm cooperatives. 
"(C) 1 member actively engaged in the production of 
a food animal commodity. 
"(D) 1 member actively engaged in the production of 
a plant commodity. 
"(E) 1 member representing a national animal commod-
ity organization. 
"(F) 1 member representing a national crop commodity 
organization. 
"(G) 1 member representing a national aquaculture 
association. 
"(H) 1 member representing a national food animal 
science society. 
"(I) 1 member representing a national crop, soil, agron-
omy, horticulture, or weed science society. 
"(J) 1 member representing a national food science 
organization. 
"(K) 1 member representing a national human health 
association. 
"(L) 1 member representing a national nutritional 
science society. 
"(M) 1 member representing the land-grant colleges 
and universities eligible to receive funds under the Act 
of July 2, 1862 (7 U.S.C. 301 et seq.). 
"(N) 1 member representing the land-grant colleges 
and universities eligible to receive funds under the Act 
of August 30, 1890 (7 U.S.C. 321 et seq.), including 
Tuskegee University. 
"(O) 1 member representing the 1994 Institutions (as 
defined in section 532 of the Equity in Educational Land-
Grant Status Act of 1994 (PubHc Law 103-382; 7 U.S.C. 
301 note)). 
"(P) 1 member representing Hispanic-serving institu-
tions. 
"(Q) 1 member representing the American Colleges 
of Veterinary Medicine. 
"(R) 1 member representing that portion of the sci-
entific community not closely associated with agriculture. 
"(S) 1 member engaged in the transportation of food 
and agricultural products to domestic and foreign markets. 
"(T) 1 member representing food retailing and market-
ing interests. 
"(U) 1 member representing food and fiber processors. 
"(V) 1 member actively engaged in rural economic 
development. 
110 STAT. 1158 
PUBLIC LAW 104-127—APR. 4, 1996 
"(W) 1 member representing a national consumer 
interest group. 
"(X) 1 member representing a national forestry group. 
"(Y) 1 member representing a national conservation 
or natural resource group. 
"(Z) 1 member representing private sector organiza-
tions involved in international development. 
"(AA) 1 member representing an agency within the 
Department of Agriculture that lacks research capabilities. 
"(BB) 1 member representing a research agency of 
the Federal Government (other than the Department of 
Agriculture). 
"(CC) 1 member representing a national social science 
association. 
"(DD) 1 member representing national organizations 
directly concerned with agricultural research, education, 
and extension. 
"(4) Ex OFFICIO MEMBERS.—The Secretary, the Under Sec-
retary of Agriculture for Research, Education, and Economics, 
the Administrator of the Agricultural Research Service, the 
Administrator of the Cooperative State Research, Education, 
and Extension Service, the Administrator of the Economic 
Research Service, and the Administrator of the National Agri-
cultural Statistics Service shall serve as ex officio members 
of the Advisory Board. 
"(5) OFFICERS.—At the first meeting of the Advisory Board 
each year, the members shall elect from among the members 
of the Advisory Board a chairperson, vice chairperson, and 
7 additional members to serve on the executive committee 
established under paragraph (6). 
"(6) EXECUTIVE COMMITTEE.—The Advisory Board shall 
establish an executive committee charged with the responsibil-
ity of working with the Secretary and officers and employees 
of the Department of Agriculture to summarize and disseminate 
the recommendations of the Advisory Board. 
"(c) DUTIES.—The Advisory Board shall— 
"(1) review and provide consultation to the Secretary and 
land-grant colleges and universities on long-term and short-
term national policies and priorities, as set forth in section 
1402, relating to agricultural research, extension, education, 
and economics; 
"(2) evaluate the results and effectiveness of agricultural 
research, extension, education, and economics with respect to 
the policies and priorities; 
"(3) review and make recommendations to the Under Sec-
retary of Agriculture for Research, Education, and Economics 
on the research, extension, education, and economics portion 
of the draft strategic plan required under section 306 of title 
5, United States Code; and 
"(4) review the mechanisms of the Department of Agri-
culture for technology assessment (which should be conducted 
by qualified professionals) for the purposes o
f
— 
"(A) performance measurement and evaluation of the 
implementation by the Secretary of the strategic plan 
required under section 306 of title 5, United States Code; 
"(B) implementation of the national research policies 
and priorities set forth in section 1402; and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1159 
"(C) the development of mechanisms for the assessment 
of emerging pubUc and private agricultural research and 
technology transfer initiatives. 
"(d) CONSULTATION.—In carrying out this section, the Advisory 
Board shall solicit opinions and recommendations from persons 
who will benefit from and use federally funded 
agricultural 
research, extension, education, and economics. 
"(e) APPOINTMENT.—A member of the Advisory Board shall 
be appointed by the Secretary for a term of up to 3 years. The 
members of the Advisory Board shall be appointed to serve stag-
gered terms. 
"(f) FEDERAL ADVISORY COMMITTEE ACT.—The Advisory Board 
shall be deemed to have filed a charter for the purpose of section 
9(c) of the Federal Advisory Committee Act (5 U.S.C. App.). 
"(g) TERMINATION.—The Advisory Board shall remain in exist-
ence until September 30, 2002.". 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1404(1) of the National Agricultural Research, 
Extension, and Teaching Pohcy Act of 1977 (7 U.S.C. 3103(1)) 
is amended by striking "National Agricultural Research and 
Extension Users Advisory Board" and inserting "National Agri-
cultural 
Research, 
Extension, 
Education, and Economics 
Advisory Board". 
(2) Section 1410(2) of the National Agricultural Research, 
Extension, and Teaching Pohcy Act of 1977 (7 U.S.C. 3125(2)) 
is amended by striking "the recommendations of the Advisory 
Board developed under section 1408(g)," and inserting "any 
recommendations of the Advisory Board". 
(3) The last sentence of section 4(a) of the Renewable 
Resources Extension Act of 1978 (16 U.S.C. 1673(a)) is amended 
by striking "National Agricultural Research and Extension 
Users Advisory Board" and inserting "National Agricultural 
Research, Extension, Education, and Economics Advisory 
Board". 
SEC. 803. FEDERAL ADVISORY COMMITTEE ACT EXEMPTION FOR FED-
ERAL-STATE COOPERATIVE PROGRAMS. 
Section 1409A of the National Agricultural Research, Extension, 
and Teaching Pohcy Act of 1977 (7 U.S.C. 3124a) is amended 
by adding at the end the following: 
"(e) APPLICABILITY OF FEDERAL ADVISORY COMMITTEE ACT.— 
"(1) 
PUBLIC 
MEETINGS.—All 
meetings 
of any 
entity 
described in paragraph (3) shall be publicly announced in 
advance and shall be open to the public. Detailed minutes Records, 
of meetings and other appropriate records of the activities 
of such an entity shall be kept and made available to the 
public on request. 
"(2) EXEMPTION.—The Federal Advisory Committee Act (5 
U.S.C. App.) and title XVIII of this Act shall not apply to 
any entity described in paragraph (3). 
"(3) ENTITIES DESCRIBED.—This subsection shall apply to 
any committee, board, commission, panel, or task force, or 
similar entity that— 
"(A) is created for the purpose of cooperative efforts 
in agricultural research, extension, or teaching; and 
"(B) consists entirely o
f
— 
"(i) full-time Federal employees; and 
110 STAT. 1160 
PUBLIC LAW 104-127—APR. 4, 1996 
"(ii) one or more individuals who are employed 
by, or are officials o
f
— 
"(I) a State cooperative institution or State 
cooperative agency; or 
"(II) a public college or university or other 
postsecondary institution.". 
SEC. 
804. COORDINATION AND PLANNING OF AGRICULTURAL 
RESEARCH, EXTENSION, AND EDUCATION. 
The National Agricultural Research, Extension, and Teaching 
Policy Act of 1977 is amended by inserting after section 1413 
(7 U.S.C. 3128) the following: 
7 use 3129. 
"SEC. 14I3A. ACCOUNTABILITY. 
"(a) REVIEW OF INFORMATION TECHNOLOGY SYSTEMS.—The Sec-
retary shall conduct a comprehensive review of state-of-the-art 
information technology systems that are available for use in devel-
oping the system required by subsection (b). 
"(b) MONITORING AND EVALUATION SYSTEM.—The Secretary 
shall develop and carry out a system to monitor and evaluate 
agricultural research and extension activities conducted or sup-
ported by the Department of Agriculture that will enable the Sec-
retary to measure the impact and effectiveness of research, exten-
sion, and education programs according to priorities, goals, and 
mandates established by law. In developing the system, the Sec-
retary shall incorporate information transfer technologies to opti-
mize public access to research information. 
"(c) CONSISTENCY WiTH OTHER REQUIREMENTS.—The Secretary 
shall develop and implement the system in a manner consistent 
with the Government Performance and Results Act of 1993 (Public 
Law 103-62; 107 Stat. 285) and amendments made by the Act. 
"(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated such sums as are necessary to carry out this 
section. 
7 use 3129a. 
"SEC. 1413B. FEDERAL ADVISORY COMMITTEE ACT EXEMPTION FOR 
COMPETITIVE RESEARCH, EXTENSION, AND EDUCATION 
PROGRAMS. 
"The Federal Advisory Committee Act (5 U.S.C. App.) and 
title XVIII of this Act shall not apply to any committee, board, 
commission, panel, or task force, or similar entity, created solely 
for the purpose of reviewing applications or proposals requesting 
funding under any competitive research, extension, or education 
program carried out by the Secretary.". 
SEC. 805. GRANTS AND FELLOWSHIPS FOR FOOD AND AGRICULTURAL 
SCIENCES EDUCATION. 
(a) PURPOSE OF GRANTS.—Section 1417(b) of the National Agri-
cultural Research, Extension, and Teaching Policy Act of 1977 (7 
U.S.C. 3152(b)) is amended by striking paragraph (4) and inserting 
the following: 
"(4) to design and implement food and agricultural pro-
grams to build teaching and research capacity at colleges and 
universities having significant minority enrollments;". 
(b) RESEARCH FOUNDATIONS.—Section 1417(c) of the National 
Agricultural Research, Extension, and Teaching Policy Act of 1977 
(7 U.S.C. 3152(c)) is amended by adding at the end the following: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1161 
"(3) RESEARCH FOUNDATIONS.—An eligible college or univer-
sity under subsection (b) includes a research foundation main-
tained by the college or university.". 
(c) EXTENSION OF PROGRAM.—Section 1417(i) of the National 
Agricultural Research, Extension, and Teaching Policy Act of 1977 
(7 U.S.C. 3152(i)) is amended by striking "1995" and inserting 
"1997". 
(d) SECONDARY EDUCATION AND 2-YEAR POSTSECONDARY EDU-
CATION TEACHING PROGRAMS.—Section 1417 of the National Agricul-
tural Research, Extension, and Teaching Policy Act of 1977 (7 
U.S.C. 3152) is amended— 
(1) by redesignating subsections (h) and (i) as subsections 
(i) and (j), respectively; and 
(2) by inserting after subsection (g) the following: 
"(h) SECONDARY EDUCATION AND 2-YEAR POSTSECONDARY EDU-
CATION TEACHING PROGRAMS.— 
"(1) DEFINITIONS.—In this subsection: 
"(A) INSTITUTION OF HIGHER EDUCATION.—The term 
'institution of higher education' has the meaning given 
the term in section 1201(a) of the Higher Education Act 
of 1965 (20 U.S.C. 1141(a)). 
"(B) SECONDARY SCHOOL.—^The term 'secondary school' 
has the meaning given the term in section 14101(25) of 
the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 8801(25)). 
"(2) AGRISCIENCE AND AGRIBUSINESS EDUCATION.—The Sec-
retary shall— 
"(A) promote and strengthen secondary education and 
2-year postsecondary education in agriscience and agri-
business in order to help ensure the existence in the United 
States of a qualified workforce to serve the food and agricul-
tural sciences system; and 
"(B) promote complementary and synergistic linkages 
among secondary, 2-year postsecondary, and higher edu-
cation programs in the food and agricultural sciences in 
order to promote excellence in education and encourage 
more young Americans to pursue and complete a bacca-
laureate or higher degree in the food and agricultural 
sciences. 
"(3) GRANTS.—The Secretary may make competitive or non-
competitive grants, for grant periods not to exceed 5 years, 
to public secondary schools, and institutions of higher education 
that award an associate's degree, that the Secretary determines 
have made a commitment to teaching agriscience and agri-
business— 
"(A) to enhance curricula in agricultural education; 
"(B) to increase faculty teaching competencies; 
"(C) to interest young people in pursuing higher edu-
cation in order to prepare for scientific and professional 
careers in the food and agricultural sciences; 
"(D) to promote the incorporation of agriscience and 
agribusiness subject matter into other instructional pro-
grams, particularly classes in science, business, and 
consumer education; 
"(E) to facilitate joint initiatives by the grant recipient 
with other secondary schools, institutions of higher edu-
cation that award an associate's degree, and institutions 
110 STAT. 1162 
PUBLIC LAW 104-127—APR. 4, 1996 
of higher education that award a bachelor's degree to maxi-
mize the development and use of resources, such as faculty, 
facilities, and equipment, to improve agriscience and agri-
business education; and 
"(F) to support other initiatives designed to meet local, 
State, regional, or national needs related to promoting 
excellence in agriscience and agribusiness education.". 
SEC. 806. GRANTS FOR RESEARCH ON THE PRODUCTION AND MARKET-
ING OF ALCOHOLS AND INDUSTRIAL HYDROCARBONS 
FROM 
AGRICULTURAL 
COMMODITIES 
AND 
FOREST 
PRODUCTS. 
Section 1419(d) of the National Agricultural Research, Exten-
sion, and Teaching Pohcy Act of 1977 (7 U.S.C. 3154(d)) is amended 
by striking "1995" and inserting "1997". 
SEC. 807. POLICY RESEARCH CENTERS. 
The National Agricultural Research, Extension, and Teaching 
Policy Act of 1977 is amended by inserting after section 1419 
(7 U.S.C. 3154) the following: 
7 u s e 3155. 
"SEC. 1419A. POLICY RESEARCH CENTERS. 
"(a) IN GENERAL.—Consistent with this section, the Secretary 
may make grants, competitive grants, and special research grants 
to, and enter into cooperative agreements and other contracting 
instruments with, policy research centers described in subsection 
(b) to conduct research and education programs that are objective, 
operationally independent, and external to the Federal Government 
and that concern the effect of public policies on— 
"(1) the farm and agricultural sectors; 
"(2) the environment; 
"(3) rural families, households, and economies; and 
"(4) consumers, food, and nutrition. 
"(b) ELIGIBLE RECIPIENTS.—State agricultural experiment sta-
tions, colleges and universities, other research institutions and 
organizations, private organizations, corporations, and individuals 
shall be eligible to apply for funding under subsection (a). 
"(c) ACTIVITIES.—Under this section, funding may be provided 
for disciplinary and interdisciplinary research and 
education 
concerning policy research activities consistent with this section, 
including activities that— 
"(1) quantify the implications of public policies and regula-
tions; 
"(2) develop theoretical and research methods; 
"(3) collect and analyze data for policymakers, analysts, 
and individuals; and 
"(4) develop programs to train analysts. 
"(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated such sums as are necessary to carry out this 
section for fiscal years 1996 and 1997.". 
SEC. 808. HUMAN NUTRITION INTERVENTION AND HEALTH PRO-
MOTION RESEARCH PROGRAM. 
The National Agricultural Research, Extension, and Teaching 
Pohcy Act of 1977 is amended by striking section 1424 (7 U.S.C. 
3174) and inserting the following: 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1163 
"SEC. 1424. HUMAN NUTRITION INTERVENTION AND HEALTH PRO- 
7 USC 3174. 
MOTION RESEARCH PROGRAM. 
"(a) AUTHORITY OF SECRETARY.—The Secretary may establish, 
and award grants for projects for, a multi-year research initiative 
on human nutrition intei'vention and health promotion. 
"(b) EMPHASIS OF INITIATIVE.—In administering human nutri-
tion research projects under this section, the Secretary shall give 
specific emphasis to— 
"(1) coordinated longitudinal research assessments of nutri-
tional status; and 
"(2) the implementation of unified, innovative intervention 
strategies, 
to identify and solve problems of nutritional inadequacy and contrib-
ute to the maintenance of health, well-being, performance, and 
productivity of individuals, thereby reducing the need of the individ-
uals to use the health care system and social programs of the 
United States. 
"(c) ADMINISTRATION OF FUNDS.—The Administrator of the Agri-
cultural Research Service shall administer funds made available 
to carry out this section to ensure a coordinated approach to health 
and nutrition research efforts. 
"(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated such sums as are necessary to carry out this 
section for fiscal years 1996 and 1997. 
"SEC. 1424A. PILOT RESEARCH PROGRAM TO COMBINE MEDICAL AND 
7 USC 3174a. 
AGRICULTURAL RESEARCH. 
"(a) FINDINGS.—Congress finds the following: 
"(1) Although medical researchers in recent years have 
demonstrated that there are several naturally occurring com-
pounds in many vegetables and fruits that can aid in the 
prevention of certain forms of cancer, coronary heart disease, 
stroke, and atherosclerosis, there has been almost no research 
conducted to enhance these compounds in food plants by mod-
ern breeding and molecular genetic methods. 
"(2) By linking the appropriate medical and agricultural 
research scientists in a highly-focused, targeted research pro-
gram, it should be possible to develop new varieties of vegeta-
bles and fi*uits that would provide greater prevention of diet-
related diseases that are a major cause of death in the United ' 
States. 
"(b) PILOT RESEARCH PROGRAM.—The Secretary shall conduct, 
through the Cooperative State Research, Education, and Extension 
Service, a pilot research program to link major cancer and heart 
and other circulatory disease research efforts with agricultural 
research efforts to identify compounds in vegetables and fruits 
that prevent these diseases. Using information derived from such 
combined research efforts, the Secretary shall assist in the develop-
ment of new varieties of vegetables and fruits having enhanced 
therapeutic properties for disease prevention. 
"(c) AGREEMENTS.—The Secretary shall carry out the pilot pro-
gram through agreements entered into with land-grant colleges 
or universities, other universities, State agricultural experiment 
stations, the 
State 
cooperative 
extension 
services, 
nonprofit 
organizations with demonstrable expertise, or Federal or State 
governmental entities. The Secretary shall enter into the agree-
ments on a competitive basis. 
110 STAT. 1164 
PUBLIC LAW 104-127—APR. 4, 1996 
"(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated $10,000,000 for fiscal year 1997 to carry out 
the pilot program.". 
SEC. 809. FOOD AND NUTRITION EDUCATION PROGRAM. 
Section 1425(c)(3) of the National Agricultural Research, Exten-
sion, and Teaching Policy Act of 1977 (7 U.S.C. 3175(c)(3)) is amend-
ed by striking "$63,000,000" and all that follows through "fiscal 
year 1995" and inserting ", $83,000,000 for each of fiscal years 
1996 and 1997". 
SEC. 810. PURPOSES AND FINDINGS RELATING TO ANIMAL HEALTH 
AND DISEASE RESEARCH. 
Section 1429 of the National Agricultural Research, Extension, 
and Teaching Policy Act of 1977 (7 U.S.C. 3191) is amended to 
read as follows: 
"SEC. 1429. PURPOSES AND FINDINGS RELATING TO ANIMAL HEALTH 
AND DISEASE RESEARCH. 
"(a) PURPOSES.—The purposes of this subtitle are to— 
"(1) promote the general welfare through the improved 
health and productivity of domestic livestock, poultry, aquatic 
animals, and other income-producing animals that are essential 
to the food supply of the United States and the welfare of 
producers and consumers of animal products; 
"(2) improve the health of horses; 
"(3) facilitate the effective treatment of, and, to the extent 
possible, prevent animal and poultry diseases in both domes-
ticated and wild animals that, if not controlled, would be disas-
trous to the United States livestock and poultry industries 
and endanger the food supply of the United States; 
"(4) improve methods for the control of organisms and 
residues in food products of animal origin that could endanger 
the human food supply; 
"(5) improve the housing and management of animals to 
improve the well-being of livestock production species; 
"(6) minimize livestock and poultry losses due to transpor-
tation and handling; 
"(7) protect human health through control of animal dis-
eases transmissible to humans; 
"(8) improve methods of controlling the births of predators 
and other animals; and 
"(9) otherwise promote the general welfare 
through 
expanded programs of research and extension to improve ani-
mal health. 
"(b) FINDINGS.—Congress finds that— 
"(1) the total animal health and disease research and exten-
sion efforts of State colleges and universities and of the Federal 
Government would be more effective if there were close 
coordination between the efforts; and 
"(2) colleges and universities having accredited schools or 
colleges of veterinary medicine £ind State agricultural experi-
ment stations that conduct animal health and disease research 
are especially vital in training research workers in animal 
health and related disciplines.". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1165 
SEC. 811. ANIMAL HEALTH AND DISEASE CONTINUING RESEARCH. 
Section 1433 of the National Agricultural Research, Extension, 
and Teaching PoUcy Act of 1977 (7 U.S.C. 3195) is amended— 
(1) in the first sentence of subsection (a), by striking "1995" 
and inserting "1997"; 
(2) in subsection (b)(2)— 
(A) by striking "domestic livestock and poultry" each 
place it appears and inserting "domestic livestock, poultry, 
and commercial aquaculture species"; and 
(B) in the second sentence, by striking "horses, and 
poultry" and inserting "horses, poultry, and commercial 
aquaculture species"; 
(3) in subsection (d), by striking "domestic livestock and 
poultry" and inserting "domestic livestock, poultry, 
and 
commercial aquaculture species"; and 
(4) in subsection (f), by striking "domestic livestock and 
poultry" and inserting "domestic livestock, poultry, 
and 
commercial aquaculture species". 
SEC. 812. ANIMAL HEALTH AND DISEASE NATIONAL OR REGIONAL 
RESEARCH. 
Section 1434 of the National Agricultural Research, Extension, 
and Teaching PoUcy Act of 1977 (7 U.S.C. 3196) is amended— 
(1) in subsection (a)— 
(A) by inserting "or national or regional problems relat-
ing to pre-harvest, on-farm food safety, or animal well-
being," after "problems,"; and 
(B) by striking "1995" and inserting "1997"; 
(2) in subsection (b), by striking "eligible institutions" and 
inserting "State agricultural experiment stations, colleges and 
universities, other research institutions and organizations. Fed-
eral agencies, private organizations or corporations, and 
individuals"; 
(3) in subsection (c)— 
(A) in the first sentence, by inserting ", food safety, 
and animal well-being" after "animal health and disease"; 
and 
(B) in the fourth sentence— 
(i) by redesignating paragraphs (2) and (3) as para-
graphs (4) and (5), respectively; and 
(ii) by inserting after paragraph (1) the following: 
"(2) any food safety problem that has a significant pre-
harvest (on-farm) component and is recognized as posing a 
significant health hazard to the consuming public; 
"(3) issues of animal well-being related to production meth-
ods that will improve the housing and management of animals 
to improve the well-being of livestock production species;"; 
(4) in the first sentence of subsection (d), by striking "to 
eligible institutions"; and 
(5) by adding at the end the following: 
"(f) APPLICABILITY OF FEDERAL ADVISORY COMMITTEE ACT.— 
The Federal Advisory Committee Act (5 U.S.C. App.) and title 
XVIII of this Act shall not apply to a panel or board created 
solely for the purpose of reviewing applications or proposals submit-
ted under this subtitle.". 
110 STAT. 1166 
PUBLIC LAW 104-127—APR. 4, 1996 
SEC. 813. GRANT PROGRAM TO UPGRADE AGRICULTURAL AND FOOD 
SCIENCES FACILITIES AT 1890 LAND-GRANT COLLEGES. 
Section 1447(b) of the National Agricultural Research, Exten-
sion, and Teaching Pohcy Act of 1977 (7 U.S.C. 3222b(b)) is amended 
by striking "$8,000,000 for each of the fiscal years 1991 through 
1995" and inserting ", $15,000,000 for each of fiscal years 1996 
and 1997". 
SEC. 
814. 
NATIONAL 
RESEARCH 
AND 
TRAINING 
CENTENNIAL 
CENTERS. 
Section 1448 of the National Agricultural Research, Extension, 
and Teaching Policy Act of 1977 (7 U.S.C. 3222c) is amended— 
(1) in subsection (a)(1), by inserting ", or fiscal years 1996 
and 1997," after "1995"; and 
(2) in subsection (f), by striking "1995" and inserting "1997". 
SEC. 815. PROGRAMS FOR fflSPANIC-SERVING INSTITUTIONS. 
(a) IN GENERAL.—The National Agricultural Research, Exten-
sion, and Teaching Policy Act of 1977 is amended by inserting 
after section 1448 (7 U.S.C. 3222c) the following: 
"Subtitle H—Programs for Hispanic-
Serving Institutions 
7 u s e 3241. 
"SEC. 1455. EDUCATION GRANTS PROGRAMS FOR HISPANIC-SERVING 
INSTITUTIONS. 
"(a) GRANT AUTHORITY.—The Secretary may make competitive 
grants (or grants without regard to any requirement for competition) 
to Hispanic-serving institutions for the purpose of promoting and 
strengthening the ability of Hispanic-serving institutions to carry 
out education, applied research, and related community develop-
ment programs. 
"(b) USE OF GRANT FUNDS.—Grants made under this section 
shall be used— 
"(1) to support the activities of consortia of Hispanic-serving 
institutions to enhance educational equity for underrepresented 
students; 
"(2) to strengthen institutional educational capacities, 
including libraries, curriculum, faculty, scientific instrumenta-
tion, instruction delivery systems, and student recruitment and 
retention, in order to respond to identified State, regional, 
national, or international educational needs in the food and 
agricultural sciences; 
"(3) to attract and support undergraduate and graduate 
students from underrepresented groups in order to prepare 
them for careers related to the food, agricultural, and natural 
resource systems of the United States, beginning with the 
mentoring of students at the high school level and continuing 
with the provision of financial support for students through 
their attainment of a doctoral degree; and 
"(4) to facilitate cooperative initiatives between 2 or more 
Hispanic-serving institutions, or between 
Hispanic-serving 
institutions and units of State government or the private sector, 
to maximize the development and use of resources, such as 
faculty, facilities, and equipment, to improve food and agricul-
tural sciences teaching programs. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1167 
"(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated to make grants under this section $20,000,000 
for fiscal year 1997.". 
(b) HISPANIC-SERVING INSTITUTION DEFINED.—Paragraph (9) of 
section 1404 of the National Agricultural Research, Extension, and 
Teaching Policy Act of 1977 (7 U.S.C. 3103) is amended to read 
as follows: 
"(9) the term 'Hispanic-serving institution' has the meaning 
given the term by section 316(b)(1) of the Higher Education 
Act of 1965 (20 U.S.C. 1059c(b)(l));". 
SEC. 816. INTERNATIONAL AGRICULTURAL RESEARCH AND EXTEN-
SION. 
Section 1458(a)(8) of the National Agricultural Research, Exten-
sion, and Teaching Policy Act of 1977 (7 U.S.C. 3291(a)(8)) is 
amended— 
(1) by striking "establish" and inserting "continue"; and 
(2) by striking "to be". 
SEC. 817. AUTHORIZATION OF APPROPRIATIONS FOR AGRICULTURAL 
RESEARCH PROGRAMS. 
Section 1463 of the National Agricultural Research, Extension, 
and Teaching PoHcy Act of 1977 (7 U.S.C. 3311) is amended by 
striking "1995" both places it appears and inserting "1997". 
SEC. 818. AUTHORIZATION OF APPROPRIATIONS FOR EXTENSION EDU-
CATION. 
Section 1464 of the National Agricultural Research, Extension, 
and Teaching PoHcy Act of 1977 (7 U.S.C. 3312) is amended by 
striking "fiscal year 1995" and inserting "each of fiscal years 1995 
through 1997". 
SEC. 
8
1
9
. 
SUPPLEMENTAL 
AND 
ALTERNATIVE 
CROPS 
RESEARCH. 
(a) EXTENSION OF PROGRAM.—Section 1473D(a) of the National 
Agricultural Research, Extension, and Teaching Policy Act of 1977 
(7 U.S.C. 3319d(a)) is amended by striking "1995" and inserting 
"1997". 
(b) 
ELIMINATION OF PILOT NATURE OF PROGRAM.—Section 
1473D of the National Agricultural Research, Extension, and Teach-
ing Policy Act of 1977 (7 U.S.C. 3319d) is amended— 
(1) in subsection (a), by striking "and pilot"; 
(2) in subsection (c)(2)(B), by striking "at pilot sites" and 
all that follows through "the area"; 
(3) in subsection (c)(2)(C), by striking "from pilot sites"; 
(4) in subsection (c)(2)(D)— 
(A) by striking "near such pilot sites"; and 
(B) by striking "successful pilot program" and inserting 
"successful program"; and 
(5) in paragraph (3), by striking "pilot". 
(c) 
ADDITIONAL 
AUTHORITY.—Section 
1473D(c)(3) 
of 
the 
National Agricultural Research, Extension, and Teaching Policy 
Act of 1977 (7 U.S.C. 3319d(c)(3)) is amended— 
(1) in subparagraph (C), by striking "and" at the end; 
(2) in subparagraph (D), by striking the period at the 
end and inserting a semicolon; and 
(3) by adding at the end the following: 
"(E) to conduct fundamental and applied research related 
to the development of new commercial products derived from 
110 STAT. 1168 
PUBLIC LAW 104-127—APR. 4, 1996 
natural plant material for industrial, medical, and agricultural 
applications; and 
"(F) to participate with colleges and universities, other 
Federal agencies, and private sector entities in conducting 
research described in subparagraph (E).". 
SEC. 820. AQUACULTURE ASSISTANCE PROGRAMS. 
(a) DEFINITION.—Section 1404(3) of the National Agricultural 
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
3103(3)) is amended by inserting "ornamental fish," after "reptile,". 
(b) REPORTS.—Section 
1475 of the National 
Agricultural 
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
3322) is amended— 
(1) by striking subsection (e); and 
(2) by redesignating subsections (f) and (g) as subsections 
(e) and (f), respectively. 
(c) 
AUTHORIZATION OF APPROPRIATIONS FOR AQUACULTURE 
RESEARCH FACILITIES.—Section 1476(b) of the National Agricultural 
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
3323(b)) is amended by striking "1995" and inserting "1997". 
(d) AUTHORIZATION OF APPROPRIATIONS FOR RESEARCH AND 
EXTENSION.—Section 1477 of the National Agricultural Research, 
Extension, and Teaching PoHcy Act of 1977 (7 U.S.C. 3324) is 
amended by striking "1995" and inserting "1997". 
SEC. 821. AUTHORIZATION OF APPROPRIATIONS FOR RANGELAND 
RESEARCH. 
Section 1483(a) of the National Agricultural Research, Exten-
sion, and Teaching Pohcy Act of 1977 (7 U.S.C. 3336(a)) is amended 
by striking "1995" and inserting "1997". 
Subtitle B—^Modification and Extension of 
Activities Under 1990 Act 
SEC. 831. WATER QUALITY RESEARCH, EDUCATION, AND COORDINA-
TION. 
Section 1481(d) of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (7 U.S.C. 5501(d)) is amended by striking "1995" 
and inserting "1997". 
SEC. 832. NATIONAL GENETICS RESOURCES PROGRAM. 
(a) FUNCTIONS.—Section 1632(d) of the Food, Agriculture, Con-
servation, and Trade Act of 1990 (7 U.S.C. 5841(d)) is amended 
by striking paragraph (4) and inserting the following: 
"(4) unless otherwise prohibited by law, have the right 
to make available on request, without charge and without 
regard to the country from which the request originates, the 
genetic material that the program assembles;". 
(b) AUTHORIZATION OF APPROPRIATIONS.—Section 1635(b) of the 
Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
5844(b)) is amended by striking "1995" and inserting "1997". 
SEC. 833. NATIONAL AGRICULTURAL WEATHER INFORMATION SYSTEM. 
Section 1641(c) of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (7 U.S.C. 5855(c)) is amended by striking "1995" 
and inserting "1997". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1169 
SEC. 834. LIVESTOCK PRODUCT SAFETY AND INSPECTION PROGRAM. 
Section 1670(e) of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (7 U.S.C. 5923(e)) is amended by striking "1995" 
and inserting "1997". 
SEC. 835. PLANT GENOME MAPPING PROGRAM. 
Section 1671(g) of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (7 U.S.C. 5924(g)) is amended by inserting 
"for fiscal years 1996 and 1997" after "appropriated". 
SEC. 836. CERTAIN SPECIALIZED RESEARCH PROGRAMS. 
Subsections (d)(4), (e)(4), and (i) of section 1672 of the Food, 
Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5925) 
are each amended by striking "1995" and inserting "1997". 
SEC. 837. AGRICULTURAL TELECOMMUNICATIONS PROGRAM. 
Section 1673(h) of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (7 U.S.C. 5926(h)) is amended by striking "1995" 
and inserting "1997". 
SEC. 838. NATIONAL CENTERS FOR AGRICULTURAL PRODUCT QUALITY 
RESEARCH. 
(a) PURPOSES OF NATIONAL CENTERS.—Section 1675(a) of the 
Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
5928(a)) is amended— 
(1) by redesignating paragraphs (5) and (6) as paragraphs 
(6) and (7), respectively; and 
(2) by inserting after paragraph (4) the following: 
"(5) enhance agricultural competitiveness through product 
quality research and technology implementation;". 
(b) REGIONAL BASIS OF CENTERS.—Section 1675(b) of the Food, 
Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5928(b)) 
is amended by striking paragraph (1) and inserting the following: 
"(1) REGIONAL BASIS.—The centers shall be regionally based 
units that conduct a broad spectrum of research, development, 
£ind education programs to enhance the competitiveness, qual-
ity, safety and wholesomeness of agricultural products.". 
(c) PROGRAM PLAN AND REVIEW.—Section 1675(d) of the Food, 
Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5928(b)) 
is amended— 
(1) in paragraph (1), by striking the second sentence; and 
(2) in paragraph (2), by striking ", but not less" and all 
that follows through "the Secretary". 
(d) AUTHORIZATION OF APPROPRIATIONS.—Section 1675(g)(1) of 
the Food, Agriculture, Conservation, and Trade Act of 1990 (7 
U.S.C. 5928(g)(1)) is amended by striking "1995" and inserting 
"1997". 
SEC. 839. RED MEAT SAFETY RESEARCH CENTER. 
Section 1676 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5929) is amended to read as follows: 
"SEC. 1676. RED MEAT SAFEIY RESEARCH CENTER. 
"(a) ESTABLISHMENT OF CENTER.—The Secretary of Agriculture Grants, 
shall award a grant, on a competitive basis, to a research facility 
described in subsection (b) to establish a red meat safety research 
center. 
110 STAT. 1170 
PUBLIC LAW 104-127—APR. 4, 1996 
"(b) ELIGIBLE RESEARCH FACILITY DESCRIBED.—A research facil-
ity eligible for a grant under subsection (a) is a research facility 
that— 
"(1) is part of a land-grant college or university, or other 
federally supported agricultural research facility, located in 
close proximity to a livestock slaughter and processing facility; 
and 
"(2) is staffed by professionals with a wide diversity of 
scientific expertise covering all aspects of meat science. 
"(c) RESEARCH CONDUCTED.—The red meat safety research cen-
ter established under subsection (a) shall carry out research related 
to general food safety, including— 
"(1) the development of intervention strategies that reduce 
microbiological contamination of carcass surfaces; 
"(2) research regarding microbiological mapping of carcass 
surfaces; and 
"(3) the development of model hazard analysis and critical 
control point plans. 
"(d) ADMINISTRATION OF FUNDS.—The Secretary of Agriculture 
shall administer funds appropriated to carry out this section. 
"(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated such sums as are necessary for fiscal year 
1997 to carry out this section.". 
SEC. 840. INDIAN RESERVATION EXTENSION AGENT PROGRAM. 
Section 1677 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5930) is amended— 
(1) by redesignating subsection (f) as subsection (g); and 
(2) by inserting after subsection (e) the following: 
"(f) REDUCED REGULATORY BURDEN.—On a determination by 
the Secretary of Agriculture that a program carried out under 
this section has been satisfactorily administered for not less than 
2 years, the Secretary shall implement a reduced reapplication 
process for the continued operation of the program in order to 
reduce regulatory burdens on participating university and tribal 
entities.". 
SEC. 841. ASSISTIVE TECHNOLOGY PROGRAM FOR FARMERS WITH 
DISABILITIES. 
Section 1680 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5933) is amended— 
(1) in subsection (a)(6)(B), by striking "1996" and inserting 
"1997"; and 
(2) in subsection (b)(2), by striking "1996" and inserting 
"1997". 
SEC. 842. NATIONAL RURAL INFORMATION CENTER CLEARINGHOUSE. 
Section 2381(e) of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (7 U.S.C. 3125b(e)) is amended by striking 
"1995" and inserting "1997". 
SEC. 843. GLOBAL CLIMATE CHANGE. 
Section 2412 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 6710) is amended by striking "1996" and 
inserting "1997". 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1171 
Subtitle C—Repeal of Certain Activities 
and Authorities 
SEC. 851. SUBCOMMITTEE ON FOOD, AGRICULTURAL, AND FORESTRY 
RESEARCH. 
Section 401(h) of the National Science and Technology Policy, 
Organization, and Priorities Act of 1976 (42 U.S.C. 6651(h)) is 
amended by striking the second through fifth sentences. 
SEC. 852. JOINT COUNCIL ON FOOD AND AGRICULTURAL SCIENCES. 
(a) 
REPEAL.—Section 
1407 of the 
National 
Agricultural 
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
3122) is repealed. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1405 of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3121) 
is amended— 
(A) in paragraph (5), by striking "Joint Council, 
Advisory Board," and inserting "Advisory Board"; and 
(B) in paragraph (11), by striking "the Joint Council,". 
(2) Section 1410(2) of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3125(2)) 
is amended by striking "the recommendations of the Joint 
Council developed under section 1407(f),". 
(3) Section 1412 of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3127) 
is amended— 
(A) in the section heading, by striking "THE JOINT 
COUNCIL, ADVISORY BOARD," and inserting "ADVISORY 
BOARD"; 
(B) in subsection (a)— 
(i) by striking "Joint Council, the Advisory Board," 
and inserting "Advisory Board"; 
(ii) by striking "the cochairpersons of the Joint 
Council and" each place it appears; and 
(iii) in paragraph (2), by striking "one shall serve 
as the executive secretary to the Joint Council, one 
shall serve as the executive secretary to the Advisory 
Board," and inserting "one shall serve as the executive 
secretary to the Advisory Board"; and 
(C) in subsections (b) and (c), by striking "Joint Council, 
Advisory Board," each place it appears and inserting 
"Advisory Board". 
(4) Section 1413 of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3128) 
is amended— 
(A) in subsection (a), by striking "Joint Council, the 
Advisory Board," and inserting "Advisory Board"; and 
(B) in subsection (b), by striking "Joint Council, 
Advisory Board," and inserting "Advisory Board". 
(5) Section 1434(c) of the National Agricultural Research, 
Extension, and Teaching Pohcy Act of 1977 (7 U.S.C. 3196(c)) 
is amended— 
(A) in the second sentence, by striking "Joint Council, 
the Advisory Board," and inserting "Advisory Board"; and 
110 STAT. 1172 
PUBLIC LAW 104-127—APR. 4, 1996 
(B) in the fourth sentence, by striking "the Joint Coun-
cil,". 
SEC. 853. AGRICULTURAL SCIENCE AND TECHNOLOGY REVIEW BOARD. 
(a) REPEAL.—Section 1408A of the National 
Agricultural 
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
3123a) is repealed. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1404 of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103) 
is amended— 
(A) in paragraph (16)(F), by adding "and" at the end; 
(B) in paragraph (17), by striking "; and" at the end 
and inserting a period; and 
(C) by striking paragraph (18). 
(2) Section 1405(12) of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3121(12)) 
is amended by striking ", after coordination with the Technology 
Board,". 
(3) Section 1410(2) of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3125(2)) 
(as amended by section 802(b)(2)) is amended by striking "and 
the recommendations of the Technology Board developed under 
section 1408A(d)". 
(4) Section 1412 of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3127) 
(as amended by section 852(b)(3)) is amended— 
(A) in the section heading, by striking "AND TECH-
NOLOGY BOARD"; 
(B) in subsection (a)— 
(i) by striking "and the Technology Board" each 
place it appears; and 
(ii) in paragraph (2), by striking "and one shall 
serve as the executive secretary to the Technology 
Board"; and 
(C) in subsections (b) and (c), by striking "and Tech-
nology Board" each place it appears. 
(5) Section 1413 of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3128) 
(as amended by section 852(b)(4)) is amended— 
(A) in subsection (a), by striking "or the Technology 
Board"; and 
(B) in subsection (b), by striking "and the Technology 
Board". 
SEC. 854. ANIMAL HEALTH SCIENCE RESEARCH ADVISORY BOARD. 
Section 1432 of the National Agricultural Research, Extension, 
and Teaching Policy Act of 1977 (7 U.S.C. 3194) is repealed. 
SEC. 855. RESIDENT INSTRUCTION PROGRAM AT 1890 LAND-GRANT 
COLLEGES. 
Section 1446 of the National Agricultural Research, Extension, 
and Teaching Policy Act of 1977 (7 U.S.C. 3222a) is repealed. 
SEC. 
8
5
6
. 
GRANTS 
TO 
STATES 
FOR 
INTERNATIONAL 
TRADE 
DEVELOP-
MENT 
CENTERS. 
Section 1458A of the National Agricultural Research, Extension, 
and Teaching Policy Act of 1977 (7 U.S.C. 3292) is repealed. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1173 
SEC. 857. RANGELAND RESEARCH. 
(a) REPORTS.—Section 1481 of the National 
Agricultural 
Research, Extension, and Teaching Pohcy Act of 1977 (7 U.S.C. 
3334) is repealed. 
(b) ADVISORY BOARD.—Section 1482 of the National Agricultural 
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
3335) is repealed. 
SEC. 858. COMPOSTING RESEARCH AND EXTENSION PROGRAM. 
Section 1456 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 3130) is repealed. 
SEC. 859. EDUCATION PROGRAM REGARDING HANDLING OF AGRICUL-
TURAL CHEMICALS AND AGRICULTURAL CHEMICAL 
CONTAINERS. 
(a) REPEAL.—Section 1499A of the Food, Agriculture, Conserva-
tion, and Trade Act of 1990 (7 U.S.C. 3125c) is repealed. 
(b) CONFORMING AMENDMENT.—Section 1499(b) of the Food, 
Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5506(b)) 
is amended by striking "and section 1499A". 
SEC. 
860. PROGRAM ADMINISTRATION REGARDING SUSTAINABLE 
AGRICULTURE RESEARCH AND EDUCATION. 
(a) REPORTING REQUIREMENT.—Section 1622 of the Food, Agri-
culture, Conservation, and Trade Act of 1990 (7 U.S.C. 5812) is 
amended by striking subsection (b). 
(b) ADVISORY COUNCIL.—Section 1622 of the Food, Agriculture, 
Conservation, and Trade Act of 1990 (7 U.S.C. 5812) is amended— 
(1) in subsection (a)— 
(A) by striking paragraph (2); 
(B) in paragraph (3), by striking "subsection (e)" and 
inserting "subsection (b)"; and 
(C) by redesignating paragraphs (3) and (4) as para-
graphs (2) and (3), respectively; 
(2) by striking subsections (c) and (d); 
(3) by redesignating subsection (e) as subsection (b); and 
(4) in subsection (b)(2) (as so redesignated)— 
(A) by striking subparagraph (A); and 
(B) by redesignating subparagraphs (B) through (F) 
as subparagraphs (A) through (E), respectively. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 1619(b) of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 5801(b)) is amended— 
(A) by striking paragraph (7); and 
(B) by redesignating paragraphs (8), (9), and (10) as 
paragraphs (7), (8), and (9), respectively. 
(2) Section 1621(c) of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 5811(c)) is amended— 
(A) in paragraph (1)— 
(i) by striking subparagraph (A); and 
(ii) by redesignating subparagraphs (B) through 
(E) as subparagraphs (A) through (D), respectively; 
and 
(B) in paragraph (2)— 
(i) by striking subparagraph (A); and 
(ii) by redesignating subparagraphs (B) through 
(F) as subparagraphs (A) through (E), respectively. 
110 STAT. 1174 
PUBLIC LAW 104-127—APR. 4, 1996 
(3) Section 1628(b) of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 5831(b)) is amended by striking 
"Advisory Council, the Soil Conservation Service," and inserting 
"Natural Resources Conservation Service". 
SEC. 861. 
RESEARCH REGARDING PRODUCTION, PREPARATION, 
PROCESSING, 
HANDLING, 
AND STORAGE OF 
AGRICUL-
TURAL 
PRODUCTS. 
Subtitle E of title XVI of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 5871 et seq.) is repealed. 
SEC. 862. PLANT AND ANIMAL PEST AND DISEASE CONTROL PROGRAM. 
(a) REPEAL.—Subtitle F of title XVI of the Food, Agriculture, 
Conservation, and Trade Act of 1990 (7 U.S.C. 5881 et seq.) is 
repealed. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 28(b)(2)(A) of the Federal Insecticide, Fungicide, 
and Rodenticide Act (7 U.S.C. 136w-3(b)(2)(A)) is amended 
by striking "and the information required by section 1651 of 
the Food, Agriculture, Conservation, and Trade Act of 1990". 
(2) Section 1627(a)(3) of the Food, Agriculture, Conserva-
tion, and Trade Act of 1990 (7 U.S.C. 5821(a)(3)) is amended 
by striking "and section 1650". 
(3) Section 1628 of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 5831) is amended by striking 
"section 1650," each place it appears in subsections (a) and 
(d). 
(4) Section 1629 of the Food, Agriculture, Conservation, 
and Trade Act of 1990 (7 U.S.C. 5832) is amended by striking 
"section 1650," each place it appears in subsections (f) and 
(g)(ll). 
SEC. 863. CERTAIN SPECIALIZED RESEARCH PROGRAMS. 
Section 1672 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5925) is amended— 
(1) by striking subsections (a), (f), (g), (h), and (j); and 
(2) by redesignating subsections (i) and (k) as subsections 
(f) and (g), respectively. 
SEC. 864. COMMISSION ON AGRICULTURAL RESEARCH FACILITIES. 
Section 1674 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5927) is repealed. 
SEC. 865. SPECIAL GRANT TO STUDY CONSTRAINTS ON AGRICULTURAL 
TRADE. 
Section 1678 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5931) is repealed. 
SEC. 866. PILOT PROJECT TO COORDINATE FOOD AND NUTRITION 
EDUCATION PROGRAMS. 
Section 1679 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5932) is repealed. 
SEC. 
867. 
DEMONSTRATION 
AREAS 
FOR 
RURAL 
ECONOMIC 
DEVELOP-
MENT. 
Section 2348 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 2662a) is repealed. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1175 
SEC. 868. TECHNICAL ADVISORY COMMITTEE REGARDING GLOBAL CLI-
MATE CHANGE, 
Section 2404 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 6703) is repealed. 
SEC. 869. COMMITTEE OF NINE UNDER HATCH ACT OF 1887. 
Section 3(c)3 of the Act of March 2, 1887 (commonly known 
as the "Hatch Act of 1887"; 7 U.S.C. 361c(c)3) is amended by 
striking ", and shall be used" and all that follows through "by 
this paragraph". 
SEC. 870. COTTON CROP REPORTS. 
The Act of May 3, 1924 (43 Stat. 115, chapter 149; 7 U.S.C. 
475), is repealed. 
SEC. 871. RURAL ECONOMIC AND BUSINESS DEVELOPMENT AND ADDI-
TIONAL RESEARCH GRANTS UNDER TITLE V OF RURAL 
DEVELOPMENT ACT OF 1972. 
Section 502 of the Rural Development Act of 1972 (7 U.S.C. 
2662) is amended by striking subsections (g) and (j). 
SEC. 872. HUMAN NUTRITION RESEARCH. 
Section 1452 of the National Agricultural Research, Extension, 
and Teaching Policy Act Amendments of 1985 (Public Law 99-
198; 7 U.S.C. 3173 note) is repealed. 
SEC. 873. GRANTS TO UPGRADE 1890 LAND-GRANT COLLEGE EXTEN-
SION FACrLITIES. 
Section 1416 of the National Agricultural Research, Extension, 
and Teaching Policy Act Amendments of 1981 (7 U.S.C. 3224) 
is repealed. 
SEC. 874. INDIAN SUBSISTENCE FARMING DEMONSTRATION GRANT 
PROGRAM. 
Subtitle C of title IX of the Food, Agriculture, Conservation, 
and Trade Act Amendments of 1991 (Public Law 102-237; 7 U.S.C. 
5930 note) is repealed. 
Subtitle D—^Miscellaneous Research 
Provisions 
SEC. 881. CRITICAL AGRICULTURAL MATERIALS RESEARCH. 
(a) REPORTS.—Section 4 of the Critical Agricultural Materials 
Act (7 U.S.C. 178b) is amended— 
(1) by striking subsection (g); and 
(2) by redesignating subsection (h) as subsection (g). 
(b) AUTHORIZATION OF APPROPRIATIONS.—Section 16(a) 
of 
the 
Critical Agricultural Materials Act (7 U.S.C. 178n(a)) is amended 
by striking "1995" and inserting "1997". 
SEC. 882. MEMORANDUM OF AGREEMENT REGARDING 1994 INSTITU-
TIONS. 
Section 533 of the Equity in Educational Land-Grant Status 
Act of 1994 (Pubhc Law 103-382; 7 U.S.C. 301 note) is amended 
by adding at the end the following: 
"(d) MEMORANDUM OF AGREEMENT.—Not later than January Native 
6, 1997, the Secretary shall develop and implement a formal memo- Americans. 
110 STAT. 1176 
PUBLIC LAW 104-127—APR. 4, 1996 
randum of agreement with the 1994 Institutions to establish pro-
grams to ensure that tribally controlled colleges and Native Amer-
ican communities equitably participate in Department of Agri-
culture emplo)anent, programs, services, and resources.". 
SEC. 883. SMITH-LEVER ACT FUNDING FOR 1890 LAND-GRANT COL-
LEGES, INCLUDING TUSKEGEE UNIVERSITY. 
(a) ELIGIBILITY FOR FUNDS.—Section 3(d) of the Act of May 
8, 1914 (commonly known as the "Smith-Lever Act"; 7 U.S.C. 
343(d)), is amended by adding at the end the following: "A college 
or university eligible to receive funds under the Act of August 
30, 1890 (7 U.S.C. 321 et seq.), including Tuskegee University, 
may apply for and receive directly from the Secretary of Agri-
culture— 
"(1) amounts made available under this subsection after 
September 30, 1995, to carry out programs or initiatives for 
which no funds were made available under this subsection 
for fiscal year 1995, or any previous fiscal year, as determined 
by the Secretary; and 
"(2) amounts made available after September 30, 1995, 
to carry out programs or initiatives funded under this sub-
section prior to that date that are in excess of the highest 
amount made available for the programs or initiatives under 
this subsection for fiscal year 1995, or any previous fiscal 
year, as determined by the Secretary.". 
(b) CONFORMING AMENDMENT.—The third sentence of section 
1444(a) of the National Agricultural Research, Extension, and 
Teaching Policy Act of 1977 (7 U.S.C. 3221(a)) is amended by 
inserting before the period at the end the following: ", except that 
for the purpose of this calculation, the total appropriations shall 
not include amounts made available after September 30, 1995, 
under section 3(d) of that Act (7 U.S.C. 343(d)), to carry out pro-
grams or initiatives for which no funds were made available under 
section 3(d) of that Act for fiscal year 1995, or any previous fiscal 
year, as determined by the Secretary, and shall not include amounts 
made available after September 30, 1995, to carry out programs 
or initiatives funded under section 3(d) of that Act prior to that 
date that are in excess of the highest amount made available 
for the programs or initiatives for fiscal year 1995, or any previous 
fiscal year, as determined by the Secretary". 
SEC. 884. AGRICULTURAL RESEARCH FACILITIES. 
(a) RESEARCH FACILITIES.—The Research Facilities Act (7 
U.S.C. 390 et seq.) is amended to read as follows: 
7 u s e 390 note. 
"SECTION 1. SHORT TITLE. 
"This Act may be cited as the 'Research Facilities Act'. 
7 use 390. 
"SEC. 2. DEFINITIONS. 
"In this Act: 
"(1) AGRICULTURAL RESEARCH FACILITY.—The term 'agricul-
tural research facility means a proposed facility for research 
in food and agricultural sciences for which Federal funds are 
requested by a college, university, or nonprofit institution to 
assist in the construction, alteration, acquisition, moderniza-
tion, renovation, or remodeling of the facility. 
"(2) CONGRESSIONAL AGRICULTURE COMMITTEES.—The t e r m 
'congressional agriculture committees' means the Committee 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1177 
on Appropriations and the Committee on Agriculture of the 
House of Representatives and the Committee on Appropriations 
and the Committee on Agriculture, Nutrition, and Forestry 
of the Senate. 
"(3) FOOD AND AGRICULTURAL SCIENCES.—The term 'food 
and agricultural sciences' means— 
"(A) agriculture, including soil and water conservation 
and use, the use of organic materials to improve soil tilth 
and fertility, plant and animal production and protection, 
and plant and animal health; 
"(B) the processing, distribution, marketing, and utili-
zation of food and agricultural products; 
"(C) forestry, including range management, production 
of forest and range products, multiple use of forests and 
rangelands, and urban forestry; 
"(D) aquaculture (as defined in section 1404(3) of the 
National Agricultural Research, Extension, and Teaching 
Policy Act of 1977 (7 U.S.C. 3103(3)); 
"(E) human nutrition; 
"(F) production inputs, such as energy, to improve 
productivity; and 
"(G) germ plasm collection and preservation. 
"(4) SECRETARY.—The term 'Secretary means the Secretary 
of Agriculture. 
"(5) TASK FORCE.—The term 'task force' means the Strategic 
Planning Task Force established imder section 4. 
"SEC. 3. REVIEW PROCESS. 
7 USC 390a. 
"(a) SUBMISSION TO SECRETARY.—Each proposal for an agricul-
tural research facility shall be submitted to the Secretary for review. 
The Secretary shall review the proposals in the order in which 
the proposals are received. 
"(b) APPLICATION PROCESS.—In consultation with the congres-
sional agriculture committees, the Secretary shall establish an 
application process for the submission of proposals for agricultural 
research facilities. 
"(c) CRITERIA FOR APPROVAL.— 
"(1) DETERMINATION BY SECRETARY.—^With respect to each 
proposal for an agricultural research facility submitted under 
subsection (a), the Secretary shall determine whether the pro-
posal meets the criteria set forth in paragraph (2). 
"(2) CRITERIA.—A proposal for an agricultural research 
facility shall meet the following criteria: 
"(A) NON-FEDERAL SHARE.—The proposal shall certify 
the availability of at least a 50 percent non-Federal share 
of the cost of the facility. The non-Federal share shall 
be paid in cash and may include funding from private 
sources or from units of State or local government. 
"(B) NONDUPLICATION OP FACILITIES.—The proposal 
shall demonstrate how the agricultural research facility 
would be complementary to, and not duplicative of, facilities 
of colleges, universities, and nonprofit institutions, and 
facilities of the Agricultural Research Service, within the 
State and region. 
"(C) NATIONAL RESEARCH PRIORITIES.—The proposal 
shall demonstrate how the agricultural research facility 
would serve— 
29-194 O - 96 - 39 : QL 3 Part 1 
110 STAT. 1178 
PUBLIC LAW 104-127—APR. 4, 1996 
Reports. 
7 use 390b. 
Records. 
"(i) 1 or more of the national research poHcies 
and priorities set forth in section 1402 of the National 
Agricultural Research, Extension, and Teaching Policy 
Act of 1977 (7 U.S.C. 3101); and 
"(ii) regional needs. 
"(D) LONG-TERM SUPPORT.—The proposal shall dem-
onstrate that the recipient college, university, or nonprofit 
institution has the ability and commitment to support the 
long-term, ongoing operating costs of— 
"(i) the agricultural research facility after the facil-
ity is completed; and 
"(ii) each program to be based at the facility. 
"(d) EVALUATION OF PROPOSALS.—Not later than 90 days after 
receiving a proposal under subsection (a), the Secretary shall— 
"(1) evaluate and assess the merits of the proposal, includ-
ing the extent to which the proposal meets the criteria set 
forth in subsection (c); and 
"(2) report to the congressional agriculture committees on 
the results of the evaluation and assessment. 
"SEC. 4. TASK FORCE ON 10-YEAR STRATEGIC PLAN FOR AGRICUL-
TURAL RESEARCH FACILITIES. 
"(a) ESTABLISHMENT.—Not later than 6 months after the date 
of enactment of the Federal Agriculture Improvement and Reform 
Act of 1996, the Secretary shall establish a task force, to be known 
as the 'Strategic Planning Task Force'. The task force shall be 
comprised of 15 members. 
"(b) COMPOSITION.—The Secretary shall select the members 
of the task force from a list of individuals recommended by the 
Advisory Board established under section 1408 of the National 
Agricultural Research, Extension, and Teaching Policy Act of 1977 
(7 U.S.C. 3123). In submitting the hst to the Secretary, the Board 
may recommend for selection individuals (including members of 
the Advisory Board) who have expertise in facilities development, 
modernization, construction, consolidation, and closure. 
"(c) DUTIES.—The task force shall review all currently operating 
agricultural research facilities constructed in whole or in part with 
Federal funds, and all planned agricultural research facilities pro-
posed to be constructed with Federal funds, pursuant to criteria 
established by the Secretary, to ensure that a comprehensive 
research capacity is maintained. 
"(d) 10-YEAR STRATEGIC PLAN.—Not later than 2 years after 
the task force is established, the task force shall prepare and 
submit to the Secretary and the congressional agriculture commit-
tees a 10-year strategic plan, reflecting both national and regional 
perspectives, for development, modernization, construction, consoli-
dation, and closure of Federal agricultural research facilities and 
agricultural research facilities proposed to be constructed with Fed-
eral funds. 
"(e) APPLICABILITY OF FEDERAL ADVISORY COMMITTEE ACT.— 
"(1) PUBLIC MEETINGS.—^All meetings of the task force shall 
be publicly announced in advance and shall be open to the 
public. Detailed minutes of meetings and other appropriate 
records of the activities of the task force shall be kept and 
made available to the public on request. 
"(2) EXEMPTION.—The Federal Advisorj' Committee Act (5 
U.S.C. App.) and title XVIII of the Food and Agriculture Act 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1179 
of 1977 (7 U.S.C. 2281 et seq.) shall not apply to the task 
force. 
"(f) DEFINITION OF AGRICULTURAL RESEARCH FACILITY.—Not-
withstanding section 2(1), in this section the term 'agricultural 
research facility means a facility for research in food and agricul-
tural sciences. 
"SEC. 5. APPLICABILITY OF FEDERAL ADVISORY COMMITTEE ACT. 
7 USC 390c. 
"The Federal Advisory Committee Act (5 U.S.C. App.) and 
title XVIII of the Food and Agriculture Act of 1977 (7 U.S.C. 
2281 et seq.) shall not apply to a panel or board created solely 
for the purpose of reviewing applications or proposals submitted 
under tins Act. 
"SEC. 6. AUTHORIZATION OF APPROPRIATIONS. 
7 USC 390d. 
"(a) IN GENERAL.—Subject to subsection (b), there are author-
ized to be appropriated such sums as are necessary for fiscal years 
1996 and 1997 for the study, plan, design, structure, and related 
costs of agricultural research facilities under this Act. 
"(b) ALLOWABLE ADMINISTRATIVE COSTS.—Not more than 3 per-
cent of the funds made available for any project for an agricultural 
research facility shall be available for administration of the project.". 
(b) APPLICATION OF AMENDMENT.—The amendment made by 7 use 390 note. 
subsection (a), other than section 4 of the Research Facilities Act 
(as amended by subsection (a)), shall not apply to any project 
for an agricultural research facility for which funds have been 
made available for a feasibility study or for any phase of the 
project prior to October 1,1995. 
(c) AUTHORIZATION OF APPROPRIATIONS FOR FEDERAL FACILI-
TIES.—Section 1431 of the National Agricultural Resesirch, Exten-
sion, and Teaching Policy Act Amendments of 1985 (Public Law 
99-198; 99 Stat. 1556) is amended— 
(1) in subsection (a)— 
(A) by striking "(a)"; and 
(B) by striking "1995" and inserting "1997"; and 
(2) by striking subsection (b). 
(d) CONFORMING AMENDMENT.—Section 1463(a) of the National 
Agricultural Research, Extension, and Teaching Policy Act of 1977 
(7 U.S.C. 3311(a)) is amended by striking "1416,". 
SEC. 885. NATIONAL COMPETITIVE RESEARCH INITIATIVE. 
(a) 
AUTHORIZATION OF APPROPRLS^TIONS FOR COMPETITIVE 
GRANTS.—Subsection (b)(10) of the Competitive, Special, and Facili-
ties Research Grant Act (7 U.S.C. 450i(b)(10)) is amended— 
(1) by striking "fiscal year 1995" and inserting "each of 
fiscal years 1995 through 1997"; and 
(2) in subparagraph (B), by striking "20 percent" and insert-
ing "40 percent". 
(b) AVAILABILITY OF FUNDS.—Subsection (b) of the Competitive, 
Special, and Facilities Research Grant Act (7 U.S.C. 450i(b)) is 
amended by adding at the end the following: 
"(11) AVAILABILITY OF FUNDS.—Funds made available under 
paragraph (10) shall be available for obligation for a 2-year period 
beginning on October 1 of the fiscal year for which the funds 
are made available.". 
110 STAT. 1180 
PUBLIC LAW 104-127—APR. 4, 1996 
SEC. 886. RURAL DEVELOPMENT RESEARCH AND EDUCATION. 
Section 502(a) of the Rural Development Act of 1972 (7 U.S.C. 
2662(a)) is amended by inserting after the first sentence the follow-
ing: "The rural development extension programs shall also promote 
coordinated and integrated rural community initiatives 
that 
advance and empower capacity building through leadership develop-
ment, entrepreneurship, business development and management 
training, and strategic planning to increase jobs, income, and quality 
of life in rural communities.". 
SEC. 887. DAIRY GOAT RESEARCH PROGRAM. 
Section 1432(b)(5) of the National Agricultural Research, Exten-
sion, and Teaching Policy Act Amendments of 1981 (Public Law 
97-98; 7 U.S.C. 3222 note) is amended by striking "1995" and 
inserting "1997". 
SEC. 888. COMPETITIVE GRANTS FOR RESEARCH TO ERADICATE AND 
CONTROL BROWN CITRUS APHID AND CITRUS TRISTEZA 
VIRUS. 
Section 1672 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (7 U.S.C. 5925) (as amended by section 863) is amended 
by inserting before subsection (b) the following: 
"(a) BROWN CITRUS APHID AND CITRUS TRISTEZA VIRUS.— 
"(1) 
RESEARCH GRANTS AUTHORIZED.—The Secretary 
of 
Agriculture may make competitive grants available to support 
research for the purpose o
f
— 
"(A) developing methods to eradicate the brown citrus 
aphid and the citrus tristeza virus from citrus crops grown 
in the United States; or 
"(B) adapting citrus crops grown in the United States 
to the brown citrus aphid and the citrus tristeza virus. 
"(2) METHOD OF PROVIDING GRANTS.—Grants authorized 
under this subsection shall be made in the same manner, 
and shall be subject to the same conditions, as provided for 
competitive grants under the Competitive, Special, and Facili-
ties Research Grant Act (7 U.S.C. 450i). 
"(3) 
AUTHORIZATION 
OF APPROPRIATIONS.—There are 
authorized to be appropriated to carry out this subsection 
$3,000,000 for fiscal year 1997.". 
Arkansas. 
SEC. 889. STUTTGART NATIONAL AQUACULTURE RESEARCH CENTER. 
(a) TRANSFER OF FUNCTIONS TO SECRETARY OF AGRICULTURE.— 
(1) PURPOSE.—The first section of PubHc Law 85-342 (16 
U.S.C. 778) is amended— 
(A) by striking "Secretary of the Interior" and all that 
follows through "directed to" and inserting "Secretary of 
Agriculture shall"; 
(B) by striking "an experiment station or stations" 
and inserting "1 or more centers"; and 
(C) in paragraph (5), by striking "Department of Agri-
culture" and inserting "Secretary of the Interior". 
(2) AUTHORITY.—Section 2 of PubHc Law 85-342 (16 U.S.C. 
778a) is amended by striking ", the Secretary and all that 
follows through "authorized" and inserting ", the Secretary 
of Agriculture is authorized". 
(3) ASSISTANCE.—Section 3 of Public Law 85-342 (16 U.S.C. 
778b) is amended— 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1181 
(A) by striking "Secretary of the Interior" and inserting 
"Secretary of Agriculture"; and 
(B) by striking "Department of Agriculture" and insert-
ing "Secretary of the Interior". 
(b) TRANSFER OF FISH FARMING EXPERIMENTAL LABORATORY 
TO DEPARTMENT OF AGRICULTURE.— 
(1) DESIGNATION OF STUTTGART NATIONAL AQUACULTURE 
RESEARCH CENTER.— 
(A) IN GENI':RAL.—The Fish Farming Experimental 
Laboratory in Stuttgart, Arkansas (including the facilities 
in Kelso, Arkansas), shall be known and designated as 
the "Stuttgart National Aquaculture Research Center". 
(B) REFERENCES.—^Any reference in a law, map, regula-
tion, document, paper, or other record of the United States 
to the laboratory referred to in subparagraph (A) shall 
be deemed to be a reference to the "Stuttgart National 
Aquaculture Research Center". 
(2) TRANSFER OF LABORATORY TO DEPARTMENT OF AGRI-
CULTURE.—Subject to section 1531 of title 31, United States 
Code, not later than 90 days after the date of enactment of 
this Act, there are transferred to the Department of Agri-
culture— 
(A) the personnel employed in connection with the 
laboratory referred to in paragraph (1)(A); 
(B) the assets, liabilities, contracts, and real and per-
sonal property of the laboratory; 
(C) the records of the laboratory; and 
(D) 
the 
unexpended 
balance 
of 
appropriations, 
authorizations, allocations, and other funds employed in 
connection with, held in connection with, arising from, 
available to, or to be made available in connection with 
the laboratory. 
(3) NONDUPLICATION OF FACILITIES.—The research center 
referred to in paragraph (1)(A) shall be complementary to, 
and not duplicative of, facilities of colleges, universities, and 
nonprofit institutions, and facilities of the Agricultural Research 
Service, within the State and region, as determined by the 
Administrator of the Service. 
SEC. 
890. EXPANSION OF AUTHORITIES RELATED TO NATIONAL 
ARBORETUM.. 
(a) SOLICITATION OF GIFTS, BENEFITS, AND DEVISES.—The first 
sentence of section 5 of the Act of March 4, 1927 (20 U.S.C. 195), 
is amended by inserting "solicit," after "authorized to". 
(b) CONCESSIONS, FEES, AND VOLUNTARY SERVICES.—The Act 
of March 4, 1927 (20 U.S.C. 191 et seq.), is amended by adding 
at the end the following: 
"SEC. 6. CONCESSIONS, FEES, AND VOLUNTARY SERVICES. 
20 USC 196. 
"(a) IN GENERAL.—Notwithstanding the Federal Property and 
Administrative Services Act of 1949 (40 U.S.C. 471 et seq.) and 
section 321 of the Act of June 30, 1932 (40 U.S.C. 303b), the 
Secretary of Agriculture, in furtherance of the mission of the 
National Arboretum, may— 
"(1) negotiate agreements granting concessions at the 
National Arboretum to nonprofit scientific or educational 
organizations the interests of which are complementary to the 
mission of the National Arboretum, except that the net proceeds 
110 STAT. 1182 
PUBLIC LAW 104-127—APR. 4, 1996 
of the organizations from the concessions shall be used exclu-
sively for research and educational work for the benefit of 
the National Arboretum; 
"(2) provide by concession, on such terms as the Secretary 
of Agriculture considers appropriate and necessary, for commer-
cial services for food, drink, and nursery sales, if an agreement 
for a permanent concession under this paragraph is negotiated 
with a qualified person submitting a proposal after due consid-
eration of all proposals received after the Secretary of Agri-
culture provides reasonable public notice of the intent of the 
Secretary to enter into such an agreement; 
"(3) dispose of excess property, including excess plants and 
fish, in a manner designed to maximize revenue from any 
sale of the property, including by way of public auction, except 
that this paragraph shall not apply to the free dissemination 
of new varieties of seeds and germ plasm in accordance with 
section 520 of the Revised Statutes (commonly known as the 
'Department of Agriculture Organic Act of 1862') (7 U.S.C. 
2201); 
"(4) charge such fees as the Secretary of Agriculture consid-
ers reasonable for temporary use by individuals or groups of 
National Arboretum facilities and grounds for any purpose 
consistent with the mission of the National Arboretum; 
"(5) charge such fees as the Secretary of Agriculture consid-
ers reasonable for the use of the National Arboretum for 
commercial photography or cinematography; 
"(6) publish, in print and electronically and without regard 
to laws relating to printing by the Federal Government, 
informational brochures, books, and other publications concern-
ing the National Arboretum or the collections of the Arboretum; 
and 
"(7) license use of the National Arboretum name and logo 
for public service or commercial uses. 
"(b) USE OF FUNDS.—^Any funds received or collected by the 
Secretary of Agriculture as a result of activities described in sub-
section (a) shall be retained in a special fund in the Treasury 
for the use and benefit of the National Arboretum as the Secretary 
of Agriculture considers appropriate. 
"(c) ACCEPTANCE OF VOLUNTARY SERVICES.—The Secretary of 
Agriculture may accept the voluntary services of organizations 
described in subsection (a)(1), and the voluntary services of individ-
uals (including employees of the National Arboretum), for the bene-
fit of the National Arboretum.". 
Alabama. 
SEC. 891. TRANSFER OF AQUACULTURAL RESEARCH CENTER. 
(a) TRANSFER OF FISH CULTURE LABORATORY TO DEPARTMENT 
OF AGRICULTURE.— 
(1) 
DESIGNATION 
OF 
CLAUDE 
HARRIS 
NATIONAL 
AQUACULTURAL RESEARCH CENTER.— 
(A) IN GENERAL.—The Southeastern Fish Culture Lab-
oratory in Marion, Alabama, shall be known and designated 
as the "Claude Harris National Aquacultural Research Cen-
ter". 
(B) REFERENCES.—Any reference in a law, map, regula-
tion, document, paper, or other record of the United States 
to the laboratory referred to in subparagraph (A) shall 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1183 
be deemed to be a reference to the "Claude Harris National 
Aquacultural Research Center". 
(2) TRANSFER OF LABORATORY TO DEPARTMENT OF AGRI-
CULTURE.—Subject to section 1531 of title 31, United States 
Code, not later than 90 days after the date of enactment of 
this Act, the Secretary of the Interior may transfer, in whole 
or in part, to the Department of Agriculture, with the consent 
of the Secretary of Agriculture— 
(A) the personnel employed in connection with the 
laboratory referred to in paragraph (1); 
(B) the assets, liabilities, contracts, and real and per-
sonal property of the laboratory; 
(C) the records of the laboratory; and 
(D) the unexpended 
balance 
of 
appropriations, 
authorizations, allocations, and other funds employed in 
connection with, held in connection with, arising from, 
available to, or to be made available in connection with 
the laboratory. 
(b) NONDUPLICATION OF FACILITIES.—The research center des-
ignated by subsection (a) shall be complementary to, and not 
duplicative of, facilities of colleges, universities, and nonprofit 
institutions, and facilities of the Agricultural Research Service, 
within the State and region, as determined by the Secretary of 
Agriculture. 
SEC. 892. USE OF REMOTE SENSING DATA AND OTHER DATA TO ANTICI- 7 USC 5935. 
PATE POTENITAL FOOD, FEED, AND FIBER SHORTAGES 
OR EXCESSES AND TO PROVIDE TIMELY INFORMATION 
TO ASSIST FARMERS WITH PLANTING DECISIONS. 
(a) FINDINGS.—Congress finds that— 
(1) remote sensing data can be useful to predict impending 
famine problems and forest infestations in time to allow 
remedial action; 
(2) remote sensing data can inform the agricultural commu-
nity as to the condition of crops and the land that sustains 
those crops; and 
(3) remote sensing data and other data can be valuable, 
when received on a timely basis, in determining the need for 
additional plantings of a particular crop or a substitute crop. 
(b) INFORMATION DEVELOPMENT.—The Secretary of Agriculture 
and the Administrator of the National Aeronautics and Space 
Administration, maximizing private funding and involvement, shall 
provide farmers and other interested persons with timely informa-
tion, through remote sensing, on crop conditions, fertilization and 
irrigation needs, pest infiltration, soil conditions, projected food, 
feed, and fiber production, and any other information available 
through remote sensing. 
(c) COORDINATION.—The Secretary of Agriculture and the 
Administrator of the National Aeronautics and Space Administra-
tion shall jointly develop a proposal to provide farmers and other 
prospective users with supply and demand information for food 
and fibers. 
(d) SUNSET.—The authorities provided by this section shall 
expire 5 years after the date of enactment of this Act. 
SEC. 893. SENSE OF SENATE REGARDING METHYL BROMIDE ALTER-
NATIVE RESEARCH AND EXTENSION ACTIVITIES. 
It is the sense of the Senate that— 
110 STAT. 1184 
PUBLIC LAW 104-127—APR. 4, 1996 
(1) the Department of Agriculture should continue to make 
methyl bromide alternative research and extension activities 
a high priority of the Department; and 
(2) the Department of Agriculture, the Environmental 
Protection Agency, producer and processor 
organizations, 
environmental organizations, and State agencies should con-
tinue their dialogue on the risks and benefits of extending 
the 2001 phaseout deadline. 
Subtitle E—Research Authority After 
Fiscal Year 1997 
SEC. 897. AUTHORIZATION OF APPROPRIATIONS. 
Subject to section 898, there are authorized to be appropriated 
for fiscal years 1998 through 2002 such sums as are necessary 
to carry out the agricultural research, extension, and education 
activities and initiatives of the Department of Agriculture. 
SEC. 898. ACTIVITIES SUBJECT TO AViOLABILITY OF APPROPRIATIONS. 
During each of fiscal years 1998 through 2002, the Secretary 
of Agriculture shall conduct only those agricultural research, exten-
sion, and education activities and initiatives of the Department 
of Agriculture for which funds are specifically provided for the 
fiscal year in an appropriation Act. 
TITLE K—MISCELLANEOUS 
7 use 1
9
0
1 n
o
t
e Subtltlc A—Commercial Transportation of 
Equine for Slaughter 
SEC. 901. FINDINGS. 
Because of the unique and special needs of equine being trans-
ported to slaughter. Congress finds that it is appropriate for the 
Secretary of Agriculture to issue guidelines for the regulation of 
the commercial transportation of equine for slaughter by persons 
regularly engaged in that activity within the United States. 
SEC. 902. DEFINITIONS. 
In this subtitle: 
(1) COMMERCIAL TRANSPORTATION.—The term "commercial 
transportation" means the regular operation for profit of a 
transport business that uses trucks, tractors, trailers, or 
semitrailers, or any combination thereof, propelled or drawn 
by mechanical power on any highway or public road. 
(2) 
EQUINE 
FOR 
SLAUGHTER.—The term 
"equine 
for 
slaughter" means any member of the Equidae family being 
transferred to a slaughter facility, including an assembly point, 
feedlot, or stockyard. 
(3) PERSON.—The term "person"— 
(A) means any individual, partnership, corporation, or 
cooperative association that regularly engages in the 
commercial transportation of equine for slaughter; but 
(B) does not include any individual or other entity 
referred to in subparagraph (A) that occasionally transports 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1185 
equine for slaughter incidental to the principal activity 
of the individual or other entity in production agriculture. 
SEC. 
903. REGULATION OF COMMERCIAL TRANSPORTATION OF 
EQUINE FOR SLAUGHTER. 
(a) IN GENERAL.—Subject to the availability of appropriations, 
the Secretary of Agriculture may issue guidelines for the regulation 
of the commercial transportation of equine for slaughter by persons 
regularly engaged in that activity within the United States. 
(b) ISSUES FOR REVIEW.—In carr5dng out this section, the Sec-
retary of Agriculture shall review the food, water, and rest provided 
to equine for slaughter in transit, the segregation of stallions from 
other equine during transit, and such other issues as the Secretary 
considers appropriate. 
(c) ADDITIONAL AUTHORITY.—In carr3dng out this section, the 
Secretary of Agriculture may— 
(1) require any person to maintain such records and reports 
as the Secretary considers necessary; 
(2) conduct such investigations and inspections as the Sec-
retary considers necessary; and 
(3) establish and enforce appropriate and effective civil 
penalties. 
SEC. 904. LIMITATION OF AUTHORITY TO EQUINE FOR SLAUGHTER. 
Nothing in this subtitle authorizes the Secretary of Agriculture 
to regulate the routine or regulsir transportation, to slaughter or 
elsewhere, of— 
(1) livestock other than equine; or 
(2) poultry. 
SEC. 905. EFFECTIVE DATE. 
This subtitle shall become effective on the first day of the 
first month that begins 30 days or more after the date of enactment 
of this Act. 
Subtitle B—General Provisions 
SEC. 911. INTERSTATE QUARANTINE. 
The fourth sentence of section 8 of the Act of August 20, 
1912 (7 U.S.C. 161), is amended by inserting after "Provided, That" 
the following: "if the Secretary of Agriculture determines under 
this section that it is necessary to quarantine a State entirely 
comprised of islands, the Secretary of Agriculture, in implementing 
the restrictions authorized under this section, shall give consider-
ation to enhancing passenger movement and commerce on and 
between islands in the State: Provided/i/ri/ier. That". 
SEC. 912. COTTON CLASSIFICATION SERVICES. 
(a) EXTENSION OF AUTHORIZATION.—The first sentence of sec-
tion 3a of the Act of March 3, 1927 (commonly known as the 
"Cotton Statistics and Estimates Act") (7 U.S.C. 473a), is amended 
by striking "1996" and inserting "2002". 
(b) COTTON CLASSING OFFICE LOCATIONS.—Section 4 of the Missouri. 
Act of March 3, 1927 (commonly known as the "Cotton Statistics 
and Estimates Act") (7 U.S.C. 474), is amended by adding at the 
end the following: "The Secretary of Agriculture shall maintain 
110 STAT. 1186 
PUBLIC LAW 104-127—APR. 4, 1996 
until at least January 1, 1999, all cotton classing office locations 
in the State of Missouri that existed on January 1, 1996.". 
SEC. 913. PLANT VARIETY PROTECTION FOR CERTAIN TUBER PROPA-
GATED PLANT VARIETIES. 
(a) IN GENERAL.—Section 42(a)(l)(B)(i) of the Plant Variety 
Protection Act (7 U.S.C. 2402(a)(l)(B)(i)) is amended by inserting 
after "filing" the following: ", except that in the case of a tuber 
propagated plant variety the Secretary may waive the 4-year limita-
tion for a period ending 1 year after the date of enactment of 
the Federal Agriculture Improvement and Reform Act of 1996". 
(b) TERM OF PROTECTION.—Section 83(b) of the Plant Variety 
Protection Act (7 U.S.C. 2483(b)) is amended— 
(1) by striking "(b) The term" and inserting the following: 
"(b) TERM.— 
"(1) IN GENERAL.—Except as provided in paragraph (2), 
the term"; 
(2) in the second sentence, by striking "If the certificate" 
and inserting the following: 
"(2) EXCEPTIONS.—If the certificate"; and 
(3) in paragraph (2) (as so designated), by striking "except 
that, in the case" and inserting the following: "except that— 
"(A) in the case of a tuber propagated plant variety 
subject to a waiver granted under section 42(a)(l)(B)(i), 
the term of the plant variety protection shall expire 20 
years after the date of the original grant of the plant 
breeder's rights to the variety outside the United States; 
and 
"(B) in the case". 
SEC. 914. SWINE HEALTH PROTECTION. 
(a) TERMINATION OF STATE PRIMARY ENFORCEMENT RESPON-
SIBILITY.—Section 10 of the Swine Health Protection Act (7 U.S.C. 
3809) is amended— 
(1) by redesignating subsection (c) as subsection (d); and 
(2) by inserting after subsection (b) the following: 
"(c) REQUEST OF STATE OFFICIAL.— 
"(1) IN GENERAL.—On request of the Governor or other 
appropriate official of a State, the Secretary may terminate, 
effective as soon as the Secretary determines is practicable, 
the primary enforcement responsibility of a State under sub-
section (a). In terminating the primary enforcement responsibil-
ity under this subsection, the Secretary shall work with the 
appropriate State official to determine the level of support 
to be provided to the Secretary by the State under this Act. 
"(2) REASSUMPTION.—Nothing in this subsection shall pre-
vent a State from reassuming primary enforcement responsibil-
ity if the Secretary determines that the State meets the require-
ments of subsection (a).". 
(b) ADVISORY COMMITTEE.—The Swine Health Protection Act 
is amended— 
(1) by striking section 11 (7 U.S.C. 3810); and 
(2) by redesignating sections 12, 13, and 14 (7 U.S.C. 
3811, 3812, and 3813) as sections 11, 12, and 13, respectively. 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1187 
SEC. 915. DESIGNATION OF MOUNT PLEASANT NATIONAL SCENIC 
AREA. 
Sections 1, 2, and 3(a)(1) of the George Washington National 
Forest Mount Pleasant Scenic Area Act (Public Law 103-314; 16 
U.S.C. 545 note) are each amended by striking "George Washington 
National Forest Mount Pleasant Scenic Area" and inserting "Mount 
Pleasant National Scenic Area". 
SEC. 916. PSEUDORABIES ERADICATION PROGRAM. 
Section 2506(d) of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (21 U.S.C. 114i(d)) is amended by striking "1995" 
and inserting "2002". 
SEC. 917. COLLECTION AND USE OF AGRICULTURAL QUARANTINE AND 
INSPECTION FEES. 
Section 2509 of the Food, Agriculture, Conservation, and Trade 
Act of 1990 (21 U.S.C. 136a) is amended by striking subsection 
(a) and inserting the following: 
"(a) QUARANTINE AND INSPECTION FEES.— 
"(1) FEES AUTHORIZED.—The Secretary of Agriculture may 
prescribe and collect fees sufficient— 
"(A) to cover the cost of providing agricultural quar-
gintine and inspection services in connection with the 
arrival at a port in the customs territory of the United 
States, or the preclearance or preinspection at a site outside 
the customs territory of the United States, of an inter-
national passenger, commercial vessel, commercial aircraft, 
commercial truck, or railroad car; 
"(B) to cover the cost of administering this subsection; 
and 
"(C) through fiscal year 2002, to maintain a reasonable 
balance in the Agricultural Quarantine Inspection User 
Fee Account established under paragraph (5). 
"(2) LIMITATION.—In setting the fees under paragraph (1), 
the Secretary shall ensure that the amount of the fees is 
commensurate with the costs of agricultural quarantine and 
inspection services with respect to the class of persons or enti-
ties paying the fees. The costs of the services with respect 
to passengers as a class includes the costs of related inspections 
of the aircraft or other vehicle. 
"(3) STATUS OF FEES.—Fees collected under this subsection 
by any person on behalf of the Secretary are held in trust 
for the United States and shall be remitted to the Secretary 
in such manner and at such times as the Secretary may pre-
scribe. 
"(4) LATE PAYMENT PENALTIES.—If a person subject to a 
fee under this subsection fails to pay the fee when due, the 
Secretary shall assess a late payment penalty, and the overdue 
fees shall accrue interest, as required by section 3717 of title 
31, United States Code. 
"(5) AGRICULTURAL 
QUARANTINE 
INSPECTION 
USER FEE 
ACCOUNT.— 
"(A) ESTABLISHMENT.—There is established in the 
Treasury of the United States a fund, to be known as 
the 'Agricultural Quarantine Inspection User Fee Account', 
which shall contain all of the fees collected under this 
110 STAT. 1188 
PUBLIC LAW 104-127—APR. 4, 1996 
subsection and late payment penalties and interest charges 
collected under paragraph (4) through fiscal year 2002. 
"(B) USE OF ACCOUNT.—For each of fiscal years 1996 
through 2002, funds in the Agricultural Quarantine Inspec-
tion User Fee Account shall be available, in such amounts 
as are provided in advance in appropriations Acts, to cover 
the costs associated with the provision of agricultural quar-
antine and inspection services and the administration of 
this subsection. Amoimts made available under this 
subparagraph shall be available until expended. 
"(C) EXCESS FEES.—Fees and other amounts collected 
under this subsection in any of fiscal years 1996 through 
2002 in excess of $100,000,000 shall be available for the 
purposes specified in subparagraph (B) until expended, 
without further appropriation. 
"(6) USE OF AMOUNTS COLLECTED AFTER FISCAL YEAR 2002.— 
After September 30, 2002, the unobligated balance in the Agri-
cultural Quarantine Inspection User Fee Account and fees and 
other amounts collected under this subsection shall be credited 
to the Department of Agriculture accounts that incur the costs 
associated with the provision of agricultural quarantine and 
inspection services and the administration of this subsection. 
The fees and other amounts shall remain available to the 
Secretary until expended without fiscal year limitation. 
"(7) STAFF YEARS.—The number of full-time equivalent posi-
tions in the Department of Agriculture attributable to the provi-
sion of agricultural quarantine and inspection services and 
the administration of this subsection shall not be counted 
toward the limitation on the total number of full-time equiva-
lent positions in all agencies specified in section 5(b) of the 
Federal Workforce Restructuring Act of 1994 (Public Law 103-
226; 5 U.S.C. 3101 note) or other limitation on the total number 
of full-time equivalent positions.". 
SEC. 918. MEAT AND POULTRY INSPECTION. 
(a) ESTABLISHMENT OF SAFE MEAT AND POULTRY INSPECTION 
PANEL.— 
(1) IN GENERAL.—The Federal Meat Inspection Act is 
amended— 
(A) by redesignating section 410 (21 U.S.C. 680) as 
section 411; and 
(B) by inserting after section 409 (21 U.S.C. 679) the 
following: 
21 use 679a. 
"SEC. 410. SAFE MEAT AND POULTRY INSPECTION PANEL. 
"(a) ESTABLISHMENT.—There is established in the Department 
of Agriculture a permanent advisory panel to be known as the 
'Safe Meat and Poultry Inspection Panel' (referred to in this section 
as the 'panel'). 
"(b) DUTIES.— 
"(1) REVIEW AND EVALUATION.—The panel shall review and 
evaluate, as the panel considers necessary, the adequacy, neces-
sity, safety, cost-effectiveness, and scientific merit of— 
"(A) inspection procedures of, and work rules and 
worker relations involving Federal employees employed in, 
plants inspected under this Act; 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1189 
"(B) informal petitions or proposals for changes in 
inspection procedures, processes, and techniques of plants 
inspected under this Act; 
"(C) formal changes in meat inspection regulations 
promulgated under tlus Act, whether in notice, proposed, 
or final form; and 
"(D) such other matters as may be referred to the 
panel by the Secretary regarding the quality or effective-
ness of a safe and cost-effective meat inspection system 
under this Act. 
"(2) REPORTS.— 
"(A) IN GENERAL.—-The panel shall submit to the Sec-
retary a report on the results of each review and evaluation 
carried out under paragraph (1), including such rec-
ommendations as the panel considers appropriate. 
"(B) REPORTS ON FORMAL CHANGES.—In the case of 
a report concerning a formal change in meat inspection 
regulations, the report shall be made within the time limits 
prescribed for formal comments on such changes. 
"(C) PUBLICATION IN FEDERAL REGISTER.—Each report 
of the panel to the Secretary shall be published in the 
Federal Register. 
"(c) SECRETARIAL RESPONSE.—Not later than 90 days after the Federal Register, 
publication of a panel report under subsection (b)(2)(C), the Sec- publication, 
retary shall publish in the Federal Register any response required 
of the Secretary to the report. 
"(d) COMPOSITION OF PANEL.—The panel shall be composed 
of 7 members, not fewer than 5 of whom shall be from the food 
science, meat science, or poultry science profession, appointed to 
staggered terms not to exceed 3 years by the Secretary from nomina-
tions received from the National Institutes of Health and the Fed-
eration of American Societies of Food Animal Science and based 
on the professional qualifications of the nominees. 
"(e) NOMINATIONS.— 
"(1) INITIAL PANEL.—In constituting the initial panel, the 
Secretary shall solicit 6 nominees from the National Institutes 
of Health and 6 nominees from the Federation of American 
Societies of Food Animal Science for membership on the panel. 
"(2) VACANCIES.—^Any subsequent vacancy on the panel 
shall be filled by the Secretary after soliciting 2 nominees 
from the National Institutes of Health and 2 nominees from 
the Federation of American Societies of Food Animal Science. 
"(3) REQUIREMENTS FOR NOMINEES.— 
"(A) IN GENERAL.—Each nominee provided under para-
graph (1) or (2) shall have a background in public health 
issues and a scientific expertise in food, meat, or poultry 
science or in veterinary science. 
"(B) SUBMISSION OF INFORMATION.—The Secretary may 
require nominees to submit such information as the Sec-
retary considers necessary prior to completing the selection 
process 
"(4) ADDITIONAL, NOMINEES.—If any list of nominees pro-
vided under paragraph (1) or (2) is unsatisfactory to the Sec-
retary, the Secretary may request the nominating entities to 
submit an additional list of nominees. 
"(f) TRAVEL EXPENSES.—While away from the home or regular 
place of business of a member of the panel in the performance 
110 STAT. 1190 
PUBLIC LAW 104-127—APR. 4, 1996 
of services for the panel, the member shall be allowed travel 
expenses, including per diem in lieu of subsistence, at the same 
rate as a person employed intermittently in the Government service 
would be allowed under section 5703 of title 5, United States 
Code. 
Regulations. 
"(g) CONFLICTS OF INTEREST.—The Secretary shall promulgate 
regulations regarding conflicts of interest with respect to the mem-
bers of the panel. 
"(h) EXEMPTION.—The Federal Advisory Committee Act (5 
U.S.C. App.) and title XVIII of the Food and Agriculture Act of 
1977 (7 U.S.C. 2281 et seq.) shall not apply to the panel. 
"(i) FUNDING.—From funds available to the Secretary to carry 
out this Act and the Poultry Products Inspection Act (21 U.S.C. 
451 et seq.), the Secretary shall allocate such sums as may be 
necessary to carry out this section.". 
(2) CROSS REFERENCE IN POULTRY PRODUCTS INSPECTION 
ACT.—The Poultry Products Inspection Act (21 U.S.C. 451 et 
seq.) is amended by adding at the end the following: 
21 use 471. 
"SEC. 30. SAFE MEAT AND POULTRY INSPECTION PANEL. 
"(a) REVIEW AND EVALUATION.—The advisory panel known as 
the 'Safe Meat and Poultry Inspection Panel' established by section 
410 of the Federal Meat Inspection Act shall review and evaluate, 
as the panel considers necessary, the adequacy, necessity, safety, 
cost-effectiveness, and scientific merit o
f
— 
"(1) inspection procedures of, and work rules and worker 
relations involving Federal employees employed in, plants 
inspected under this Act; 
"(2) informal petitions or proposals for changes in inspec-
tion procedures, processes, and techniques of plants inspected 
under this Act; 
"(3) formal changes in poultry inspection regulations 
promulgated under this Act, whether in notice, proposed, or 
final form; and 
"(4) such other matters as may be referred to the panel 
by the Secretary regarding the quality or effectiveness of a 
safe and cost-effective poultry inspection system under this 
Act. 
"(b) REPORTS.— 
"(1) IN GENERAL.—The Safe Meat and Poultry Inspection 
Panel shall submit to the Secretary a report on the results 
of each review and evaluation carried out under paragraph 
(1), including such recommendations as the panel considers 
appropriate. 
"(2) REPORTS ON FORMAL CHANGES.—In the case of a report 
concerning a formal change in poultry inspection regulations, 
the report shall be made within the time limits prescribed 
for formal comments on such changes.", 
(b) INTERSTATE SHIPMENT OF STATE-INSPECTED MEAT AND 
POULTRY.—Not later than 90 days after the date of enactment 
of this Act, the Secretary of Agriculture shall submit to Congress 
recommendations concerning the steps necessary to achieve inter-
state shipment o
f
— 
(1) meat inspected under a State meat inspection program 
developed and administered under section 301 of the Federal 
Meat Inspection Act (21 U.S.C. 661); and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1191 
(2) poultry inspected under a State poultry product inspec-
tion program developed and administered under section 5 of 
the Poultry Products Inspection Act (21 U.S.C. 454). 
SEC. 919. REIMBURSABLE AGREEMENTS. 
7 USC 2260a. 
(a) IN GENERAL.—The Secretary of Agriculture (referred to 
in this section as the "Secretar)^") may enter into reimbursable 
fee agreements with persons for preclearance at locations outside 
the United States of plants, plant products, animals, and articles 
for movement into the United States. 
(b) OVERTIME, NIGHT, AND HOLIDAY WORK.—Notwithstanding 
any other provision of law, the Secretary may pay an employee 
of the Department of Agriculture performing services relating to 
imports into and exports from the United States for overtime, 
night, and holiday work performed by the employee at a rate 
of pay established by the Secretary. 
(c) REIMBURSEMENT.— 
(1) IN GENERAL.—The Secretary may require persons for 
whom preclearance services are performed to reimburse the 
Secretary for any amounts paid by the Secretary for perform-
£ince of the services. 
(2) CREDITING OF FUNDS.—All funds collected under para-
graph (1) shall be credited to the account that incurs the 
costs and shall remain available until expended without fiscal 
year limitation. 
(3) LATE PAYMENT PENALTY.— 
(A) IN GENERAL.—On failure of a person to reimburse 
the Secretary for the costs of performance of preclearance 
services— 
(i) the Secretary may assess a late pajnnent pen-
alty; and 
(ii) the overdue funds shall accrue interest in 
accordance with section 3717 of title 31, United States 
Code. 
(B) CREDITING OF FUNDS.—Any late payment penalty 
and any accrued interest collected under this paragraph 
shall be credited to the account that incurs the costs and 
shall remain available until expended without fiscal year 
limitation. 
SEC. 920. OVERSEAS TORT CLAIMS. 
7 USC 2262a. 
(a) IN GENERAL.—^The Secretary of Agriculture may pay a tort 
claim in the manner authorized by section 2672 of title 28, United 
States Code, if the claim arises outside the United States in connec-
tion with activities of individuals who are performing services for 
the Secretary. 
(b) PERIOD FOR PRESENTATION OF CLAIM.—A claim may not 
be allowed under this section unless the claim is presented in 
writing to the Secretary of Agriculture within 2 years after the 
date on which the claim accrues. 
(c) FINALITY.—Notwithstanding any other provision of law, an 
award or denial of a claim by the Secretary of Agriculture under 
this section is final. 
SEC. 921. OPERATION OF GRADUATE SCHOOL OF DEPARTMENT OF 7 USC 2279b. 
AGRICULTURE 
AS 
NONAPPROPRIATED 
FUND 
INSTRUMENTALITY. 
(a) DEFINITIONS.—In this section: 
110 STAT. 1192 
PUBLIC LAW 104-127—APR. 4, 1996 
(1) 
GRADUATE SCHOOL.—The term "Graduate 
School" 
means the Graduate School of the Department of Agriculture. 
(2) BOARD.—The term "Board" means the General Adminis-
tration Board of the Graduate School. 
(3) DIRECTOR.—The term "Director" means the Director 
of the Graduate School. 
(4) SECRETARY.—The term "Secretary" means the Secretary 
of Agriculture. 
(b) OPERATION AS NONAPPROPRIATED FUND INSTRUMENTALITY.— 
On and after the date of enactment of this Act, the Graduate 
School of the Department of Agriculture shall continue to operate 
as a nonappropriated fund instrumentality of the United States 
under the jurisdiction of the Department of Agriculture. 
(c) ACTIVITIES OF GRADUATE SCHOOL.—Under the general 
supervision of the Secretary, the Graduate School shall develop, 
administer, and provide educational, training, and professional 
development activities, including educational activities for Federal 
agencies, Federal employees, nonprofit organizations, other entities, 
and members of the general public. 
(d) FEES AND DONATIONS.— 
(1) COLLECTION OF FEES.—The Graduate School may charge 
and retain fair and reasonable fees for the activities provided 
by the Graduate School. The amount of the fees shall be based 
on the cost of the activities to the Graduate School. 
(2) ACCEPTANCE OF DONATIONS.— 
(A) ACCEPTANCE AND USE AUTHORIZED.—The Graduate 
School may accept, use, hold, dispose, and administer gifts, 
bequests, and devises of money, securities, and other real 
or personal property made for the benefit of, or in connec-
tion with, the Graduate School. 
(B) EXCEPTION.—The Graduate School shall not accept 
a donation from a person that is actively engaged in a 
procurement activity with the Graduate School or has an 
interest that may be substantially affected by the perform-
ance or nonperformance of an official duty of a member 
of the Board or an employee of the Graduate School. 
(3) NOT FEDERAL FUNDS.—Fees collected under paragraph 
(1) and amounts received under paragraph (2) shall not be 
considered to be Federal funds and shall not be required to 
be deposited in the Treasury of the United States. 
(e) GENERAL ADMINISTRATION BOARD AND DIRECTOR.— 
(1) APPOINTMENT AS GOVERNING BOARD.—The Secretary 
shall appoint a General Administration Board to serve as a 
governing board for the Graduate School and to supervise and 
direct the activities of the Graduate School. The Board shall 
be subject to regulation by the Secretary. 
(2) DUTIES OF BOARD.—The Board shall— 
(A) formulate broad policies in accordance with which 
the Graduate School shall be administered; 
(B) take all steps necessary to ensure that the highest 
possible educational standards are maintained by the Grad-
uate School; 
(C) exercise general supervision over the administra-
tion of the Graduate School; and 
(D) establish such bylaws, rules, and procedures as 
may be necessary for the fulfillment of the duties described 
in subparagraphs (A), (B), and (C). 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1193 
(3) APPOINTMENT OF DIRECTOR AND OTHER OFFICERS.—The 
Board shall select a Director and such other officers as the 
Board considers necessary to administer the Graduate School. 
The Director and other officers shall serve on such terms and 
perform such duties as the Board may prescribe. 
(4) DUTIES OF DIRECTOR.—The Director shall be responsible, 
subject to the supervision and direction of the Board, for carry-
ing out the functions of the Graduate School. 
(5) BORROWING AND INVESTMENT AUTHORITY.—The Board 
may authorize the Director— 
(A) to borrow money on the credit of the Graduate 
School; and 
(B) to invest funds held in excess of the current operat-
ing requirements of the Graduate School for purposes of 
maintaining a reasonable reserve. 
(6) LIABILITY.—The Director and the members of the Board 
shall not be held personally liable for any loss or damage 
that may accrue to the funds of the Graduate School as the 
result of any act or exercise of discretion performed in carr3dng 
out their duties under this section. 
(f) EMPLOYEES.—Employees of the Graduate School are employ-
ees of a nonappropriated fund instrumentality and shall not be 
considered to be Federal employees. 
(g) NOT A FEDERAL AGENCY.—The Graduate School shall not 
be considered to be a Federal agency for purposes o
f
— 
(1) the Federal Advisory Committee Act (5 U.S.C. App.); 
(2) section 552 or 552a of title 5, United States Code; 
or 
(3) chapter 171 of title 28, United States Code. 
(h) ACQUISITION AND DISPOSAL OF PROPERTY.—In order to carry 
out the activities of the Graduate School, the Graduate School 
may— 
(1) acquire real property in the District of Columbia and 
in other places by lease, purchase, or otherwise; 
(2) maintain, enlarge, or remodel any such property; 
(3) have sole control of any such property; and 
(4) dispose of real and personal property without regard 
to the Federal Property and Administrative Services Act of 
1949 (40 U.S.C. 471 et seq.). 
(i) CONTRACT AUTHORITY.—The Graduate School may enter 
into contracts without regard to the Federal Property and Adminis-
trative Services Act of 1949 (40 U.S.C. 471 et seq.) or any other 
law that prescribes procedures for the procurement of property 
or services by an executive agency. 
(j) USE OF DEPARTMENT FACILITIES AND RESOURCES.—The 
Graduate School may use the facilities and resources of the Depart-
ment of Agriculture, on the condition that any costs incurred by 
the Department that are attributable solely to Graduate School 
operations and all costs incurred by the Graduate School arising 
out of such operations shall be paid using funds of the Graduate 
School. Federal funds may not be used to pay the costs. 
SEC. 922. STUDENT INTERNSHIP PROGRAMS. 
7 USC 2279c. 
(a) STUDENT INTERN SUBSISTENCE PROGRAM.— 
(1) DEFINITION OF STUDENT INTERN.—In this subsection, 
the term "student intern" means a person who— 
110 STAT. 1194 
PUBLIC LAW 104-127—APR. 4, 1996 
(A) is employed by the Department of Agriculture 
(referred to in this section as the "Department") to assist 
scientific, professional, administrative, or technical employ-
ees of the Department; and 
(B) is a student in good standing at an institution 
of higher education (as defined in section 1201 of the Higher 
Education Act of 1965 (20 U.S.C. 1141)) pursuing a course 
of study related to the field in which the person is employed 
by the Department. 
(2) PAYMENT OF CERTAIN EXPENSES BY THE SECRETARY.— 
The Secretary of Agriculture (referred to in this section as 
the "Secretar/') may, out of user fee funds or funds appro-
priated to any agency of the Department, pay for lodging 
expenses, subsistence expenses, and transportation expenses 
of a student intern at the agency (including expenses of 
transportation to and from the student intern's residence at 
or near the institution of higher education attended by the 
student intern and the official duty station at which the student 
intern is employed). 
(b) 
COOPERATION 
WITH 
ASSOCIATIONS 
OF 
COLLEGES AND 
UNIVERSITIES.— 
(1) AUTHORITY TO COOPERATE.—Notwithstanding chapter 
63 of title 31, United States Code, the Secretary may enter 
into cooperative agreements on an annual basis with 1 or 
more associations of institutions of higher education (as defined 
in section 1201 of the Higher Education Act of 1965 (20 U.S.C. 
1141)) for the purpose of providing for Department participation 
in internship programs for graduate and undergraduate stu-
dents who are selected by the associations from students attend-
ing member institutions of the associations eind other institu-
tions of higher education. 
(2) INTERNSHIP PROGRAM.—An internship progrsma sup-
ported under this subsection (referred to in this subsection 
as an "internship program") shall provide work assignments 
for students within the Department and such other activities 
as the association that enters into the cooperative agreement 
under paragraph (1) with respect to the internship program 
(referred to in this subsection as the "cooperating association") 
and the Secretary shall determine. The nature of Department 
participation in an internship program shall be developed 
jointly by the Secretary and the cooperating association. 
(3) PROGRAM COORDINATION.—The cooperating association 
shall coordinate an internship program, including— 
(A) the recruitment of students; 
(B) arrangements for travel of the students to Washing-
ton, District of Columbia, and to agency field locations; 
(C) the provision of housing for students, if required; 
and 
(D) all activities for the students that take place out-
side the Department work assignments of the students. 
(4) NUMBER AND SELECTION OF STUDENTS.— 
(A) NUMBER.—A cooperative agreement entered into 
under paragraph (1) shall specify the number of students 
that the Department will host each year and a list of 
work assignments to be provided for the students. 
(B) SELECTION.—The cooperating association shall pro-
vide the Department with a pool of student candidates 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1195 
meeting the requirements for each work assignment identi-
fied by the Secretary. Final selection of the students for 
Department internship positions shall be made by the Sec-
retary. 
(5) COST REIMBURSEMENT.—From such amounts as the Sec-
retary determines are available each fiscal year for internship 
programs, and subject to such regulations as the Secretary 
may issue, the Secretary may reimburse a cooperating associa-
tion for the Department share of all direct and indirect costs 
of an internship program, including student stipends, transpor-
tation costs to the internship site, and other costs of an intern-
ship program. 
(6) LEAD AGENCY.—The Secretary may designate a lead 
agency within the Department to carry out this subsection. 
(7) 
INTERAGENCY 
AGREEMENTS.—Agencies 
and 
offices 
within the Department other than the lead agency— 
(A) may enter into interagency agreements with the 
lead agency to provide work assignments for students 
participating in an internship program; and 
(B) shall reimburse the lead agency for the direct and 
indirect costs of each student assigned to the agency under 
an internship program. 
(8) FEDERAL EMPLOYEE STATUS.—A student who partici-
pates in an internship program shall not be considered a Fed-
eral employee, except for purposes of chapter 81 of title 5, 
and chapter 171 of title 28, United States Code. 
SEC. 9
2
3
. CONVEYANCE 
OF 
EXCESS 
FEDERAL 
PERSONAL 
PROPERTY. 7 
USC 
2
2
0
6
a
. 
Notwithstanding any other provision of law, the Secretary of 
Agriculture may— 
(1) convey title to excess Federal personal property owned 
by the Department of Agriculture, with or without monetary 
compensation and for such purposes as are determined by 
the Secretary, to— 
(A) any of the 1994 Institutions (as defined in section 
532 of the Equity in Educational Land-Grant Status Act 
of 1994 (Public Law 103-382; 7 U.S.C. 301 note)); 
(B) any Hispgmic-serving institution (as defined in sec-
tion 316(b) of the Higher Education Act of 1965 (20 U.S.C. 
1059c(b))); and 
(C) any college or university eligible to receive funds 
under the Act of August 30, 1890 (7 U.S.C. 321 et seq.), 
including Tuskegee University; and 
(2) acquire from, exchange with, or dispose of personal 
property to other Federal departments and agencies without 
monetary compensation in furtherance of the purposes of this 
section. 
SEC. 
924. 
CONVEYANCE 
OF 
LAND 
TO 
WHITE 
OAK 
CEMETERY. 
(a) IN GENERAL.— 
(1) RELEASE OF INTEREST.—After execution of the agree-
ment described in subsection (b), the Secretary of Agriculture 
shall release the condition stated in the deed on the land 
described in subsection (c) that the land be used for public 
purposes, and that if the land is not so used, that the land 
revert to the United States. The release shall be on the condi-
tion that the land be used exclusively for cemetery purposes, 
Arkansas. 
110 STAT. 1196 
PUBLIC LAW 104-127—APR. 4, 1996 
Arkansas. 
Maryland. 
and that if the land is not so used, that the land revert to 
the United States. 
(2) BANKHEAD-JONES FARM TENANT ACT.—Section 32(c) of 
the Bankhead-Jones Farm Tenant Act (7 U.S.C. 1011(c)) shall 
not apply to the release under paragraph (1). 
(b) AGREEMENT.—The Secretary of Agriculture shall make the 
release under subsection (a) on execution by the Board of Trustees 
of the University of Arkansas, in consideration of the release, of 
an agreement, satisfactory to the Secretary of Agriculture, that— 
(1) the Board of Trustees will not sell, lease, exchange, 
or otherwise dispose of the land described in subsection (c) 
except to the White Oak Cemetery Association of Washington 
County, Arkansas, or a successor organization, for exclusive 
use for an expansion of the cemetery maintained by the Associa-
tion or successor organization; and 
(2) the proceeds of such a disposition of the land will 
be deposited and held in an account open to inspection by 
the Secretary of Agriculture, and used, if withdrawn from the 
account, for public purposes. 
(c) LAND DESCRIPTION.—The land described in this subsection 
is the land conveyed to the Board of Trustees of the University 
of Arkansas, with certain other land, by deed dated November 
18, 1953, comprising approximately 2.2 acres located within prop-
erty of the University of Arkansas in Washington County, Arkansas, 
commonly known as the "Savor property" and described as follows: 
The part of Section 20, Township 17 north, range 31 west, 
beginning at the north corner of the White Oak Cemetery 
and the University of Arkansas Agricultural Experiment Sta-
tion farm at Washington County road #874, running west 
approximately 330 feet, thence south approximately 135 feet, 
thence southeast approximately 384 feet, thence north approxi-
mately 330 feet to the point of beginning. 
SEC. 925. SALE OF LAND BY THE UNIVERSITY OF ARKANSAS. 
The Act of March 2, 1887 (commonly known as the "Hatch 
Act of 1887") (7 U.S.C. 361a et seq.) shall not apply to the sale 
by the University of Arkansas of the approximately 103.52 acres 
of land in Washington County, Arkansas, owned by the University 
and commonly known as the "Walker Tract", if the sale is made 
on the condition that all of the proceeds of the sale are used 
for agricultural research facilities and programs of the University 
of Arkansas. 
SEC. 926. DESIGNATION OF DALE BUMPERS SMALL FARMS RESEARCH 
CENTER. 
(a) IN GENERAL.—The small farms research facility of the Agri-
cultural Research Service located near Booneville, Arkansas, shall 
be known and designated as the "Dale Bumpers Small Farms 
Research Center". 
(b) REFERENCES.—Any reference in a law, map, regulation, 
document, paper, or other record of the United States to the 
research facility referred to in subsection (a) shall be deemed to 
be a reference to the "Dale Bumpers Small Farms Research Center". 
SEC. 9
2
7
. 
DEPARTMENT OF AGRICULTURE WASHINGTON AREA 
STRATEGIC 
SPACE 
PLAN. 
The Secretary of Agriculture may obligate not more than 
$5,000,000, from funds appropriated for agriculture buildings and 
PUBLIC LAW 104-127—APR. 4, 1996 
110 STAT. 1197 
facilities and rental payments, for the improvement of State and 
local roads relating to the construction of an office complex at 
the Beltsville Agriculture Research Center, Maryland, as part of 
the implementation of the Department of Agriculture Washington 
Area Strategic Space Plan. 
SEC. 928. SEVERABILITY. 
7 USC 7201 note. 
If any provision of this Act or the application thereof to any 
person or circumstance is held invalid, the invalidity shall not 
affect other provisions or applications of this Act that can be given 
effect without regard to the invalid provision or application, and 
to this end the provisions of this Act are severable. 
Approved April 4, 1996. 
LEGISLATIVE HISTORY—H.R. 2854 (S. 1541): 
HOUSE REPORTS: Nos. 104-462, Pt. 1 (Comm. on Agriculture) and 104-494 
(Comm. of Conference). 
CONGRESSIONAL RECORD, Vol. 142 (1996): 
Jan. 31, Feb. 1, 6, 7, S. 1541 considered and passed Senate. 
Feb. 28, 29, H.R. 2854 considered and passed House. 
Mar. 12, considered and passed Senate, amended, in lieu of S. 1541. 
Mar. 27, Senate considered conference report. 
Mar. 28, Senate and House agreed to conference report. 
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 32 (1996): 
Apr. 4, Presidential statement.