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FARM SECURITY AND RURAL INVESTMENT ACT OF 2002
[[Page 116 STAT. 134]]
Public Law 107-171
107th Congress
An Act
To provide for the continuation of agricultural programs through fiscal
year 2007, and for other purposes. <<NOTE: May 13, 2002 - [H.R.
2646]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress <<NOTE: Farm Security and Rural
Investment Act of 2002.>> assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) <<NOTE: 7 USC 7901 note.>> Short Title.--This Act may be cited
as the ``Farm Security and Rural Investment Act of 2002''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--COMMODITY PROGRAMS
Sec. 1001. Definitions.
Subtitle A--Direct Payments and Counter-Cyclical Payments
Sec. 1101. Establishment of base acres and payment acres for a farm.
Sec. 1102. Establishment of payment yield.
Sec. 1103. Availability of direct payments.
Sec. 1104. Availability of counter-cyclical payments.
Sec. 1105. Producer agreement required as condition of provision of
direct
payments and counter-cyclical payments.
Sec. 1106. Planting flexibility.
Sec. 1107. Relation to remaining payment authority under production
flexibility contracts.
Sec. 1108. Period of effectiveness.
Subtitle B--Marketing Assistance Loans and Loan Deficiency Payments
Sec. 1201. Availability of nonrecourse marketing assistance loans for
loan commodities.
Sec. 1202. Loan rates for nonrecourse marketing assistance loans.
Sec. 1203. Term of loans.
Sec. 1204. Repayment of loans.
Sec. 1205. Loan deficiency payments.
Sec. 1206. Payments in lieu of loan deficiency payments for grazed
acreage.
Sec. 1207. Special marketing loan provisions for upland cotton.
Sec. 1208. Special competitive provisions for extra long staple cotton.
Sec. 1209. Availability of recourse loans for high moisture feed grains
and seed
cotton.
Subtitle C--Peanuts
Sec. 1301. Definitions.
Sec. 1302. Establishment of payment yield and base acres for peanuts for
a farm.
Sec. 1303. Availability of direct payments for peanuts.
Sec. 1304. Availability of counter-cyclical payments for peanuts.
Sec. 1305. Producer agreement required as condition on provision of
direct
payments and counter-cyclical payments.
Sec. 1306. Planting flexibility.
Sec. 1307. Marketing assistance loans and loan deficiency payments for
peanuts.
Sec. 1308. Miscellaneous provisions.
Sec. 1309. Termination of marketing quota programs for peanuts and
compensation to peanut quota holders for loss of quota asset
value.
[[Page 116 STAT. 135]]
Sec. 1310. Repeal of superseded price support authority and effect of
repeal.
Subtitle D--Sugar
Sec. 1401. Sugar program.
Sec. 1402. Storage facility loans.
Sec. 1403. Flexible marketing allotments for sugar.
Subtitle E--Dairy
Sec. 1501. Milk price support program.
Sec. 1502. National dairy market loss payments.
Sec. 1503. Dairy export incentive and dairy indemnity programs.
Sec. 1504. Dairy product mandatory reporting.
Sec. 1505. Funding of dairy promotion and research program.
Sec. 1506. Fluid milk promotion.
Sec. 1507. Study of national dairy policy.
Sec. 1508. Studies of effects of changes in approach to national dairy
policy and fluid milk identity standards.
Subtitle F--Administration
Sec. 1601. Administration generally.
Sec. 1602. Suspension of permanent price support authority.
Sec. 1603. Payment limitations.
Sec. 1604. Adjusted gross income limitation.
Sec. 1605. Commission on application of payment limitations.
Sec. 1606. Adjustments of loans.
Sec. 1607. Personal liability of producers for deficiencies.
Sec. 1608. Extension of existing administrative authority regarding
loans.
Sec. 1609. Commodity Credit Corporation Inventory.
Sec. 1610. Reserve stock level.
Sec. 1611. Farm reconstitutions.
Sec. 1612. Assignment of payments.
Sec. 1613. Equitable relief from ineligibility for loans, payments, or
other benefits.
Sec. 1614. Tracking of benefits.
Sec. 1615. Estimates of net farm income.
Sec. 1616. Availability of incentive payments for certain producers.
Sec. 1617. Renewed availability of market loss assistance and certain
emergency assistance to persons that failed to receive
assistance under earlier authorities.
Sec. 1618. Producer retention of erroneously paid loan deficiency
payments and marketing loan gains.
TITLE II--CONSERVATION
Subtitle A--Conservation Security
Sec. 2001. Conservation security program.
Sec. 2002. Conservation compliance.
Sec. 2003. Partnerships and cooperation.
Sec. 2004. Administrative requirements for conservation programs.
Sec. 2005. Reform and assessment of conservation programs.
Sec. 2006. Conforming amendments.
Subtitle B--Conservation Reserve
Sec. 2101. Conservation reserve program.
Subtitle C--Wetlands Reserve Program
Sec. 2201. Reauthorization.
Sec. 2202. Enrollment.
Sec. 2203. Easements and agreements.
Sec. 2204. Changes in ownership; agreement modification; termination.
Subtitle D--Environmental Quality Incentives
Sec. 2301. Environmental quality incentives program.
Subtitle E--Grassland Reserve
Sec. 2401. Grassland reserve program.
Subtitle F--Other Conservation Programs
Sec. 2501. Agricultural management assistance.
Sec. 2502. Grazing, wildlife habitat incentive, source water protection,
and Great Lakes basin programs.
[[Page 116 STAT. 136]]
Sec. 2503. Farmland protection program.
Sec. 2504. Resource conservation and development program.
Sec. 2505. Small watershed rehabilitation program.
Sec. 2506. Use of symbols, slogans, and logos.
Sec. 2507. Desert terminal lakes.
Subtitle G--Conservation Corridor Demonstration Program
Sec. 2601. Definitions.
Sec. 2602. Conservation corridor demonstration program.
Sec. 2603. Implementation of conservation corridor plan.
Sec. 2604. Funding requirements.
Subtitle H--Funding and Administration
Sec. 2701. Funding and administration.
Sec. 2702. Regulations.
TITLE III--TRADE
Subtitle A--Agricultural Trade Development and Assistance Act of 1954
and Related Statutes
Sec. 3001. United States policy.
Sec. 3002. Provision of agricultural commodities.
Sec. 3003. Generation and use of currencies by private voluntary
organizations and cooperatives.
Sec. 3004. Levels of assistance.
Sec. 3005. Food Aid Consultative Group.
Sec. 3006. Maximum level of expenditures.
Sec. 3007. Administration.
Sec. 3008. Assistance for stockpiling and rapid transportation,
delivery, and distribution of shelf-stable prepackaged foods.
Sec. 3009. Sale procedure.
Sec. 3010. Prepositioning.
Sec. 3011. Transportation and related costs.
Sec. 3012. Expiration date.
Sec. 3013. Micronutrient fortification programs.
Sec. 3014. John Ogonowski Farmer-to-Farmer Program.
Subtitle B--Agricultural Trade Act of 1978
Sec. 3101. Exporter assistance initiative.
Sec. 3102. Export credit guarantee program.
Sec. 3103. Market access program.
Sec. 3104. Export enhancement program.
Sec. 3105. Foreign market development cooperator program.
Sec. 3106. Food for progress.
Sec. 3107. McGovern-Dole International Food for Education and Child
Nutrition Program.
Subtitle C--Miscellaneous
Sec. 3201. Surplus commodities for developing or friendly countries.
Sec. 3202. Bill Emerson Humanitarian Trust Act.
Sec. 3203. Emerging markets.
Sec. 3204. Biotechnology and agricultural trade program.
Sec. 3205. Technical assistance for specialty crops.
Sec. 3206. Global market strategy.
Sec. 3207. Report on use of perishable commodities and live animals.
Sec. 3208. Study on fee for services.
Sec. 3209. Sense of Congress concerning foreign assistance programs.
Sec. 3210. Sense of the Senate concerning agricultural trade.
TITLE IV--NUTRITION PROGRAMS
Sec. 4001. Short title.
Subtitle A--Food Stamp Program
Sec. 4101. Encouragement of payment of child support.
Sec. 4102. Simplified definition of income.
Sec. 4103. Standard deduction.
Sec. 4104. Simplified utility allowance.
Sec. 4105. Simplified determination of housing costs.
Sec. 4106. Simplified determination of deductions.
Sec. 4107. Simplified definition of resources.
[[Page 116 STAT. 137]]
Sec. 4108. Alternative issuance systems in disasters.
Sec. 4109. State option to reduce reporting requirements.
Sec. 4110. Cost neutrality for electronic benefit transfer systems.
Sec. 4111. Report on electronic benefit transfer systems.
Sec. 4112. Alternative procedures for residents of certain group
facilities.
Sec. 4113. Redemption of benefits through group living arrangements.
Sec. 4114. Availability of food stamp program applications on the
Internet.
Sec. 4115. Transitional food stamps for families moving from welfare.
Sec. 4116. Grants for simple application and eligibility determination
systems and improved access to benefits.
Sec. 4117. Delivery to retailers of notices of adverse action.
Sec. 4118. Reform of quality control system.
Sec. 4119. Improvement of calculation of State performance measures.
Sec. 4120. Bonuses for States that demonstrate high or most improved
performance.
Sec. 4121. Employment and training program.
Sec. 4122. Reauthorization of food stamp program and food distribution
program on Indian reservations.
Sec. 4123. Expanded grant authority.
Sec. 4124. Consolidated block grants for Puerto Rico and American Samoa.
Sec. 4125. Assistance for community food projects.
Sec. 4126. Availability of commodities for the emergency food assistance
program.
Subtitle B--Commodity Distribution
Sec. 4201. Commodity supplemental food program.
Sec. 4202. Commodity donations.
Sec. 4203. Distribution of surplus commodities to special nutrition
projects.
Sec. 4204. Emergency food assistance.
Subtitle C--Child Nutrition and Related Programs
Sec. 4301. Commodities for school lunch program.
Sec. 4302. Eligibility for free and reduced price meals.
Sec. 4303. Purchases of locally produced foods.
Sec. 4304. Applicability of Buy-American requirement to Puerto Rico.
Sec. 4305. Fruit and vegetable pilot program.
Sec. 4306. Eligibility for assistance under the special supplemental
nutrition program for women, infants, and children.
Sec. 4307. WIC farmers' market nutrition program.
Subtitle D--Miscellaneous
Sec. 4401. Partial restoration of benefits to legal immigrants.
Sec. 4402. Seniors farmers' market nutrition program.
Sec. 4403. Nutrition information and awareness pilot program.
Sec. 4404. Hunger fellowship program.
Sec. 4405. General effective date.
TITLE V--CREDIT
Subtitle A--Farm Ownership Loans
Sec. 5001. Direct loans.
Sec. 5002. Financing of bridge loans.
Sec. 5003. Amount of guarantee of loans for farm operations on tribal
lands.
Sec. 5004. Guarantee of loans made under State beginning farmer or
rancher programs.
Sec. 5005. Down Payment Loan Program.
Sec. 5006. Beginning farmer and rancher contract land sales program.
Subtitle B--Operating Loans
Sec. 5101. Direct loans.
Sec. 5102. Suspension of limitation on period for which borrowers are
eligible for guaranteed assistance.
Subtitle C--Emergency Loans
Sec. 5201. Emergency loans in response to an emergency resulting from
quarantines.
Subtitle D--Administrative Provisions
Sec. 5301. Evaluations of direct and guaranteed loan programs.
Sec. 5302. Eligibility of trusts and limited liability companies for
farm ownership loans, farm operating loans, and emergency
loans.
[[Page 116 STAT. 138]]
Sec. 5303. Debt settlement.
Sec. 5304. Temporary authority to enter into contracts; private
collection agencies.
Sec. 5305. Interest rate options for loans in servicing.
Sec. 5306. Elimination of requirement that Secretary require county
committees to certify in writing that certain loan reviews
have been conducted.
Sec. 5307. Simplified loan guarantee application available for loans of
greater amounts.
Sec. 5308. Inventory property.
Sec. 5309. Administration of certified lenders and preferred certified
lenders programs.
Sec. 5310. Definitions.
Sec. 5311. Loan authorization levels.
Sec. 5312. Reservation of funds for direct operating loans for beginning
farmers and ranchers.
Sec. 5313. Interest rate reduction program.
Sec. 5314. Reamortization of recapture payments.
Sec. 5315. Allocation of certain funds for socially disadvantaged
farmers and ranchers.
Sec. 5316. Waiver of borrower training certification requirement.
Sec. 5317. Timing of loan assessments.
Sec. 5318. Annual review of borrowers.
Sec. 5319. Loan eligibility for borrowers with prior debt forgiveness.
Sec. 5320. Making and servicing of loans by personnel of State, county,
or area committees.
Sec. 5321. Eligibility of employees of State, county, or area committee
for loans and loan guarantees.
Subtitle E--Farm Credit
Sec. 5401. Repeal of burdensome approval requirements.
Sec. 5402. Banks for cooperatives.
Sec. 5403. Insurance corporation premiums.
Subtitle F--General Provisions
Sec. 5501. Technical amendments.
TITLE VI--RURAL DEVELOPMENT
Subtitle A--Consolidated Farm and Rural Development Act
Sec. 6001. Eligibility of rural empowerment zones and rural enterprise
communities for direct and guaranteed loans for essential
community facilities.
Sec. 6002. Water or waste disposal grants.
Sec. 6003. Rural business opportunity grants.
Sec. 6004. Child day care facilities.
Sec. 6005. Rural water and wastewater circuit rider program.
Sec. 6006. Multijurisdictional regional planning organizations.
Sec. 6007. Loan guarantees for certain rural development loans.
Sec. 6008. Tribal college and university essential community facilities.
Sec. 6009. Emergency and imminent community water assistance grant
program.
Sec. 6010. Water and waste facility grants for Native American tribes.
Sec. 6011. Grants for water systems for rural and native villages in
Alaska.
Sec. 6012. Grants to nonprofit organizations to finance the
construction, refurbishing, and servicing of individually-
owned household water well systems in rural areas for
individuals with low or moderate incomes.
Sec. 6013. Loans and loan guarantees for renewable energy systems.
Sec. 6014. Rural business enterprise grants.
Sec. 6015. Rural cooperative development grants.
Sec. 6016. Grants to broadcasting systems.
Sec. 6017. Business and industry loan modifications.
Sec. 6018. Use of rural development loans and grants for other purposes.
Sec. 6019. Simplified application forms for loan guarantees.
Sec. 6020. Definition of rural and rural area.
Sec. 6021. National Rural Development Partnership.
Sec. 6022. Rural telework.
Sec. 6023. Historic barn preservation.
Sec. 6024. Grants for NOAA weather radio transmitters.
Sec. 6025. Grants to train farm workers in new technologies and to train
farm workers in specialized skills necessary for higher value
crops.
Sec. 6026. Rural community advancement program.
Sec. 6027. Delta Regional Authority.
Sec. 6028. Northern Great Plains Regional Authority.
[[Page 116 STAT. 139]]
Sec. 6029. Rural business investment program.
Sec. 6030. Rural strategic investment program.
Sec. 6031. Funding of pending rural development loan and grant
applications.
Subtitle B--Rural Electrification Act of 1936
Sec. 6101. Guarantees for bonds and notes issued for electrification or
telephone purposes.
Sec. 6102. Expansion of 911 access.
Sec. 6103. Enhancement of access to broadband service in rural areas.
Subtitle C--Food, Agriculture, Conservation, and Trade Act of 1990
Sec. 6201. Alternative Agricultural Research and Commercialization
Corporation.
Sec. 6202. Rural electronic commerce extension program.
Sec. 6203. Telemedicine and distance learning services in rural areas.
Subtitle D--SEARCH Grants for Small Communities
Sec. 6301. Definitions.
Sec. 6302. SEARCH grant program.
Sec. 6303. Report.
Sec. 6304. Funding.
Subtitle E--Miscellaneous
Sec. 6401. Value-added agricultural product market development grants.
Sec. 6402. Agriculture innovation center demonstration program.
Sec. 6403. Fund for Rural America.
Sec. 6404. Rural local television broadcast signal loan guarantees.
Sec. 6405. Rural firefighters and emergency personnel grant program.
Sec. 6406. Sense of Congress on rural policy coordination.
TITLE VII--RESEARCH AND RELATED MATTERS
Subtitle A--Extensions
Sec. 7101. National rural information center clearinghouse.
Sec. 7102. Grants and fellowships for food and agricultural sciences
education.
Sec. 7103. Policy research centers.
Sec. 7104. Human nutrition intervention and health promotion research
program.
Sec. 7105. Pilot research program to combine medical and agricultural
research.
Sec. 7106. Nutrition education program.
Sec. 7107. Continuing animal health and disease research programs.
Sec. 7108. Appropriations for research on national or regional problems.
Sec. 7109. Grants to upgrade agricultural and food sciences facilities
at 1890 land-grant colleges, including Tuskegee University.
Sec. 7110. National research and training virtual centers.
Sec. 7111. Hispanic-serving institutions.
Sec. 7112. Competitive grants for international agricultural science and
education programs.
Sec. 7113. University research.
Sec. 7114. Extension service.
Sec. 7115. Supplemental and alternative crops.
Sec. 7116. Aquaculture research facilities.
Sec. 7117. Rangeland research.
Sec. 7118. National genetics resources program.
Sec. 7119. High-priority research and extension initiatives.
Sec. 7120. Nutrient management research and extension initiative.
Sec. 7121. Agricultural telecommunications program.
Sec. 7122. Assistive technology program for farmers with disabilities.
Sec. 7123. Partnerships for high-value agricultural product quality
research.
Sec. 7124. Biobased products.
Sec. 7125. Integrated research, education, and extension competitive
grants program.
Sec. 7126. Equity in Educational Land-Grant Status Act of 1994.
Sec. 7127. 1994 Institution research grants.
Sec. 7128. Endowment for 1994 Institutions.
Sec. 7129. Precision agriculture.
Sec. 7130. Thomas Jefferson Initiative for crop diversification.
Sec. 7131. Support for research regarding diseases of wheat, triticale,
and barley caused by fusarium graminearum or by tilletia
indica.
Sec. 7132. Office of Pest Management Policy.
Sec. 7133. National Agricultural Research, Extension, Education, and
Economics Advisory Board.
Sec. 7134. Grants for research on production and marketing of alcohols
and industrial hydrocarbons from agricultural commodities and
forest products.
[[Page 116 STAT. 140]]
Sec. 7135. Agricultural experiment stations research facilities.
Sec. 7136. Competitive, special, and facilities research grants national
research initiative.
Sec. 7137. Federal agricultural research facilities authorization of
appropriations.
Sec. 7138. Critical agricultural materials research.
Sec. 7139. Aquaculture.
Subtitle B--Modifications
Sec. 7201. Equity in Educational Land-Grant Status Act of 1994.
Sec. 7202. Carryover for experiment stations.
Sec. 7203. Authorization percentages for research and extension formula
funds.
Sec. 7204. Carryover for eligible institutions.
Sec. 7205. Initiative for future agriculture and food systems.
Sec. 7206. Eligibility for integrated grants program.
Sec. 7207. Agricultural Research, Extension, and Education Reform Act of
1998.
Sec. 7208. Food, Agriculture, Conservation, and Trade Act of 1990.
Sec. 7209. National Agricultural Research, Extension, and Teaching
Policy Act of 1977.
Sec. 7210. Biotechnology risk assessment research.
Sec. 7211. Competitive, special, and facilities research grants.
Sec. 7212. Matching funds requirement for research and extension
activities of 1890 Institutions.
Sec. 7213. Matching requirements for research and extension formula
funds for insular area land-grant institutions.
Sec. 7214. Definition of food and agricultural sciences.
Sec. 7215. Federal Extension Service.
Sec. 7216. Policy research centers.
Sec. 7217. Availability of competitive grant funds.
Sec. 7218. Organic agriculture research and extension initiative.
Sec. 7219. Senior scientific research service.
Sec. 7220. Termination of certain schedule a appointments.
Sec. 7221. Biosecurity planning and response programs.
Sec. 7222. Indirect costs for small business innovation research grants.
Sec. 7223. Carbon cycle research.
Subtitle C--Repeal of Certain Activities and Authorities
Sec. 7301. Food Safety Research Information Office and National
Conference.
Sec. 7302. Reimbursement of expenses under Sheep Promotion, Research,
and Information Act of 1994.
Sec. 7303. Market expansion research.
Sec. 7304. National Advisory Board on Agricultural Weather.
Sec. 7305. Agricultural information exchange with Ireland.
Sec. 7306. Pesticide resistance study.
Sec. 7307. Expansion of education study.
Sec. 7308. Task force on 10-year strategic plan for agricultural
research facilities.
Subtitle D--New Authorities
Sec. 7401. Subtitle definitions.
Sec. 7402. Research equipment grants.
Sec. 7403. Joint requests for proposals.
Sec. 7404. Review of Agricultural Research Service.
Sec. 7405. Beginning farmer and rancher development program.
Sec. 7406. Sense of Congress regarding doubling of funding for
agricultural research.
Sec. 7407. Organic production and market data initiatives.
Sec. 7408. International organic research collaboration.
Sec. 7409. Report on producers and handlers of organic agricultural
products.
Sec. 7410. Report on genetically modified pest-protected plants.
Sec. 7411. Study of nutrient banking.
Sec. 7412. Grants for youth organizations.
Subtitle E--Miscellaneous
Sec. 7501. Resident instruction and distance education at institutions
of higher education in United States insular areas.
Sec. 7502. Definitions.
Sec. 7503. Resident instruction and distance education grants program
for insular area institutions of higher education.
Sec. 7504. Declaration of extraordinary emergency and resulting
authorities.
Sec. 7505. Agricultural biotechnology research and development for
developing countries.
Sec. 7506. Land acquisition authority, national peanut research
laboratory, Dawson, Georgia.
[[Page 116 STAT. 141]]
TITLE VIII--FORESTRY
Subtitle A--Cooperative Forestry Assistance Act of 1978
Sec. 8001. Repeal of forestry incentives program and stewardship
incentive program.
Sec. 8002. Establishment of forest land enhancement program.
Sec. 8003. Enhanced community fire protection.
Subtitle B--Amendments to Other Laws
Sec. 8101. Sustainable forestry outreach initiative; renewable resources
extension activities.
Sec. 8102. Office of International Forestry.
Subtitle C--Miscellaneous Provisions
Sec. 8201. McIntire-Stennis cooperative forestry research program.
TITLE IX--ENERGY
Sec. 9001. Definitions.
Sec. 9002. Federal procurement of biobased products.
Sec. 9003. Biorefinery development grants.
Sec. 9004. Biodiesel fuel education program.
Sec. 9005. Energy audit and renewable energy development program.
Sec. 9006. Renewable energy systems and energy efficiency improvements.
Sec. 9007. Hydrogen and fuel cell technologies.
Sec. 9008. Biomass research and development.
Sec. 9009. Cooperative research and extension projects.
Sec. 9010. Continuation of bioenergy program.
TITLE X--MISCELLANEOUS
Subtitle A--Crop Insurance
Sec. 10001. Equal crop insurance treatment of potatoes and sweet
potatoes.
Sec. 10002. Continuous coverage.
Sec. 10003. Quality loss adjustment procedures.
Sec. 10004. Adjusted gross revenue insurance pilot program.
Sec. 10005. Sense of Congress on expansion of crop insurance coverage.
Sec. 10006. Report on specialty crop insurance.
Subtitle B--Disaster Assistance
Sec. 10101. Reference to sea grass and sea oats as crops covered by
noninsured crop disaster assistance program.
Sec. 10102. Emergency grants to assist low-income migrant and seasonal
farmworkers.
Sec. 10103. Emergency loans for seed producers.
Sec. 10104. Assistance for livestock producers.
Sec. 10105. Market loss assistance for apple producers.
Sec. 10106. Market loss assistance for onion producers.
Sec. 10107. Commercial fisheries failure.
Sec. 10108. Study of feasibility of producer indemnification from
Government-caused disasters.
Subtitle C--Tree Assistance Program
Sec. 10201. Definitions.
Sec. 10202. Eligibility.
Sec. 10203. Assistance.
Sec. 10204. Limitations on assistance.
Sec. 10205. Authorization of appropriations.
Subtitle D--Animal Welfare
Sec. 10301. Definition of animal under the Animal Welfare Act.
Sec. 10302. Prohibition on interstate movement of animals for animal
fighting.
Sec. 10303. Penalties and foreign commerce provisions of the Animal
Welfare Act.
Sec. 10304. Report on rats, mice, and birds.
Sec. 10305. Enforcement of Humane Methods of Slaughter Act of 1958.
Subtitle E--Animal Health Protection
Sec. 10401. Short title.
Sec. 10402. Findings.
Sec. 10403. Definitions.
Sec. 10404. Restriction on importation or entry.
[[Page 116 STAT. 142]]
Sec. 10405. Exportation.
Sec. 10406. Interstate movement.
Sec. 10407. Seizure, quarantine, and disposal.
Sec. 10408. Inspections, seizures, and warrants.
Sec. 10409. Detection, control, and eradication of diseases and pests.
Sec. 10410. Veterinary accreditation program.
Sec. 10411. Cooperation.
Sec. 10412. Reimbursable agreements.
Sec. 10413. Administration and claims.
Sec. 10414. Penalties.
Sec. 10415. Enforcement.
Sec. 10416. Regulations and orders.
Sec. 10417. Authorization of appropriations.
Sec. 10418. Repeals and conforming amendments.
Subtitle F--Livestock
Sec. 10501. Transportation of poultry and other animals.
Sec. 10502. Swine contractors.
Sec. 10503. Right to discuss terms of contract.
Sec. 10504. Veterinary training.
Sec. 10505. Pseudorabies eradication program.
Subtitle G--Specialty Crops
Sec. 10601. Marketing orders for caneberries.
Sec. 10602. Availability of section 32 funds.
Sec. 10603. Purchase of specialty crops.
Sec. 10604. Protection for purchasers of farm products.
Sec. 10605. Farmers' market promotion program.
Sec. 10606. National organic certification cost-share program.
Sec. 10607. Exemption of certified organic products from assessments.
Sec. 10608. Cranberry acreage reserve program.
Subtitle H--Administration
Sec. 10701. Initial rate of basic pay for employees of county
committees.
Sec. 10702. Commodity Futures Trading Commission pay comparability.
Sec. 10703. Overtime and holiday pay.
Sec. 10704. Assistant Secretary of Agriculture for Civil Rights.
Sec. 10705. Operation of Graduate School of Department of Agriculture.
Sec. 10706. Implementation funding and information management.
Sec. 10707. Outreach and assistance for socially disadvantaged farmers
and ranchers.
Sec. 10708. Transparency and accountability for socially disadvantaged
farmers and ranchers; public disclosure requirements for
county committee elections.
Subtitle I--General Provisions
Sec. 10801. Cotton classification services.
Sec. 10802. Program of public education regarding use of biotechnology
in producing food for human consumption.
Sec. 10803. Chino Dairy Preserve Project.
Sec. 10804. Grazinglands Research Laboratory.
Sec. 10805. Food and Agricultural Policy Research Institute.
Sec. 10806. Market names for catfish and ginseng.
Sec. 10807. Food Safety Commission.
Sec. 10808. Pasteurization.
Sec. 10809. Rulemaking on labeling of irradiated food; certain
petitions.
Sec. 10810. Penalties for violations of Plant Protection Act.
Sec. 10811. Preclearance quarantine inspections.
Sec. 10812. Connecticut River Atlantic Salmon Commission.
Sec. 10813. Pine Point School.
Sec. 10814. 7-month extension of chapter 12 of title 11 of the United
States Code.
Sec. 10815. Practices involving nonambulatory livestock.
Sec. 10816. Country of origin labeling.
Subtitle J--Miscellaneous Studies and Reports
Sec. 10901. Report on specialty crop purchases.
Sec. 10902. Report on pouched and canned salmon.
Sec. 10903. Study on updating yields.
Sec. 10904. Report on effect of farm program payments.
Sec. 10905. Chiloquin Dam fish passage feasibility study.
[[Page 116 STAT. 143]]
Sec. 10906. Report on geographically disadvantaged farmers and ranchers.
Sec. 10907. Studies on agricultural research and technology.
Sec. 10908. Report on tobacco settlement agreement.
Sec. 10909. Report on sale and use of pesticides for agricultural uses.
Sec. 10910. Review of operation of agricultural and natural resource
programs on tribal trust land.
TITLE I--COMMODITY PROGRAMS
SEC. 1001. DEFINITIONS. <<NOTE: 7 USC 7901.>>
In this title (other than subtitle C):
(1) Agricultural act of 1949.--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
of the Federal Agriculture Improvement and Reform Act of 1996 (7
U.S.C. 7301).
(2) Base acres.--The term ``base acres'', with respect to a
covered commodity on a farm, means the number of acres
established under section 1101 with respect to the covered
commodity on the election made by the owner of the farm under
subsection (a) of such section.
(3) Counter-cyclical payment.--The term ``counter-cyclical
payment'' means a payment made to producers on a farm under
section 1104.
(4) Covered commodity.--The term ``covered commodity'' means
wheat, corn, grain sorghum, barley, oats, upland cotton, rice,
soybeans, and other oilseeds.
(5) Direct payment.--The term ``direct payment'' means a
payment made to producers on a farm under section 1103.
(6) Effective price.--The term ``effective price'', with
respect to a covered commodity for a crop year, means the price
calculated by the Secretary under section 1104 to determine
whether counter-cyclical payments are required to be made for
that crop year.
(7) 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 Secretary, 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 designated 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
experimental purposes.
(8) Loan commodity.--The term `loan commodity' means wheat,
corn, grain sorghum, barley, oats, upland cotton, extra long
staple cotton, rice, soybeans, other oilseeds, wool, mohair,
honey, dry peas, lentils, and small chickpeas.
(9) Other oilseed.--The term ``other oilseed'' means a crop
of sunflower seed, rapeseed, canola, safflower, flaxseed,
mustard seed, or, if designated by the Secretary, another
oilseed.
(10) Payment acres.--The term ``payment acres'' means 85
percent of the base acres of a covered commodity on a
[[Page 116 STAT. 144]]
farm, as established under section 1101, on which direct
payments and counter-cyclical payments are made.
(11) Payment yield.--
(A) In general.--The term ``payment yield'' means
the yield established under section 1102 for a farm for
a covered commodity.
(B) Updated payment yield.--The term ``updated
payment yield'' means the payment yield elected by the
owner of a farm under section 1102(e) to be used in
calculating the counter-cyclical payments for the farm.
(12) Producer.--The term ``producer'' means an owner,
operator, landlord, tenant, or sharecropper that shares in the
risk of producing a crop and is entitled to share in the crop
available for marketing from the farm, or would have shared had
the crop been produced. In determining whether a grower of
hybrid seed is a producer, the Secretary shall not take into
consideration the existence of a hybrid seed contract and shall
ensure that program requirements do not adversely affect the
ability of the grower to receive a payment under this title.
(13) Secretary.--The term ``Secretary'' means the Secretary
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) Target price.--The term ``target price'' means the
price per bushel (or other appropriate unit in the case of
upland cotton, rice, and other oilseeds) of a covered commodity
used to determine the payment rate for counter-cyclical
payments.
(16) United states.--The term ``United States'', when used
in a geographical sense, means all of the States.
Subtitle A--Direct Payments and Counter-Cyclical Payments
SEC. 1101. <<NOTE: 7 USC 7911.>> ESTABLISHMENT OF BASE ACRES AND
PAYMENT ACRES FOR A FARM.
(a) Election by Owner of Base Acres Calculation Method.--
(1) Alternative calculation methods.--For the purpose of
making direct payments and counter-cyclical payments with
respect to a farm, the Secretary shall give an owner of the farm
an opportunity to elect 1 of the following as the method by
which the base acres of all covered commodities on the farm are
to be determined:
(A) Subject to paragraphs (3) and (4), the 4-year
average of the following:
(i) Acreage planted on the farm to covered
commodities for harvest, grazing, haying, silage,
or other similar purposes for the 1998 through
2001 crop years.
(ii) Any acreage on the farm that the
producers were prevented from planting during the
1998 through 2001 crop years to covered
commodities because of
[[Page 116 STAT. 145]]
drought, flood, or other natural disaster, or
other condition beyond the control of the
producers, as determined by the Secretary.
(B) Subject to paragraph (3), the sum of the
following:
(i) The contract acreage (as defined in
section 102 of the Federal Agriculture Improvement
and Reform Act of 1996 (7 U.S.C. 7202)) used by
the Secretary to calculate the fiscal year 2002
payment authorized under section 114 of such Act
(7 U.S.C. 7214) for the covered commodities on the
farm.
(ii) The 4-year average of eligible oilseed
acreage on the farm for the 1998 through 2001 crop
years, as determined by the Secretary under
paragraph (2).
(2) Eligible oilseed acreage.--
(A) Calculation.--For purposes of paragraph
(1)(B)(ii), the eligible acreage for each oilseed on a
farm during each of the 1998 through 2001 crop years
shall be determined in the manner provided in paragraph
(1)(A), except that the total acreage for all oilseeds
on the farm for a crop year may not exceed the
difference between--
(i) the total acreage determined under
paragraph (1)(A) for all covered commodities for
that crop year; and
(ii) the total contract acreage determined
under paragraph (1)(B)(i).
(B) Effect of negative number.--If the subtraction
performed under subparagraph (A) results in a negative
number, the eligible oilseed acreage on the farm for
that crop year shall be zero for purposes of determining
the 4-year average.
(C) Offset of contract acreage.--The owner of a farm
may increase the eligible acreage for an oilseed on the
farm by reducing the contract acreage determined under
paragraph (1)(B)(i) for 1 or more covered commodities on
an acre-for-acre basis, except that the total base
acreage for each oilseed on the farm may not exceed the
4-year average of each oilseed determined under
paragraph (1)(B)(ii).
(3) Inclusion of all 4 years in average.--For the purpose of
determining a 4-year acreage average under this subsection for a
farm, the Secretary shall not exclude any crop year in which a
covered commodity was not planted.
(4) Treatment of multiple planting or prevented planting.--
For the purpose of determining under paragraph (1)(A) the
acreage on a farm that producers planted or were prevented from
planting during the 1998 through 2001 crop years to covered
commodities, if the acreage that was planted or prevented from
being planted was devoted to another covered commodity in the
same crop year (other than a covered commodity produced under an
established practice of double cropping), the owner may elect
the commodity to be used for that crop year in determining the
4-year average, but may not include both the initial commodity
and the subsequent commodity.
(b) Single Election; Time for Election.--
(1) Notice of election opportunity.--As soon as practicable
after the date of enactment of this Act, the Secretary
[[Page 116 STAT. 146]]
shall provide notice to owners of farms regarding their
opportunity to make the election described in subsection (a).
The notice shall include the following:
(A) Notice that the opportunity of an owner to make
the election is being provided only once.
(B) Information regarding the manner in which the
election must be made and the time periods and manner in
which notice of the election must be submitted to the
Secretary.
(2) Election deadline.--Within the time period and in the
manner prescribed pursuant to paragraph (1), the owner of a farm
shall submit to the Secretary notice of the election made by the
owner under subsection (a).
(c) Effect of Failure To Make Election.--If the owner of a farm
fails to make the election under subsection (a) or fails to timely
notify the Secretary of the election made, as required by subsection
(b), the owner shall be deemed to have made the election described in
subsection (a)(1)(B) to determine base acres for all covered commodities
on the farm.
(d) Application of Election to All Covered Commodities.--The
election made under subparagraph (A) or (B) of subsection (a)(1), or
deemed to be made under subsection (c), with respect to a farm shall
apply to all of the covered commodities on the farm.
(e) Treatment of Conservation Reserve Contract Acreage.--
(1) In general.--The Secretary shall provide for an
adjustment, as appropriate, in the base acres for covered
commodities for a farm whenever either of the following
circumstances occurs:
(A) A conservation reserve contract entered into
under section 1231 of the Food Security Act of 1985 (16
U.S.C. 3831) with respect to the farm expires or is
voluntarily terminated.
(B) Cropland is released from coverage under a
conservation reserve contract by the Secretary.
(2) Special payment rules.--For the crop year in which a
base acres adjustment under paragraph (1) is first made, the
owner of the farm shall elect to receive either direct payments
and counter-cyclical payments with respect to the acreage added
to the farm under this subsection or a prorated payment under
the conservation reserve contract, but not both.
(f) Payment Acres.--The payment acres for a covered commodity on a
farm shall be equal to 85 percent of the base acres for the covered
commodity.
(g) Prevention of Excess Base Acres.--
(1) Required reduction.--If the sum of the base acres for a
farm, together with the acreage described in paragraph (2),
exceeds the actual cropland acreage of the farm, the Secretary
shall reduce the base acres for 1 or more covered commodities
for the farm or the base acres for peanuts for the farm under
subtitle C so that the sum of the base acres and acreage
described in paragraph (2) does not exceed the actual cropland
acreage of the farm.
(2) Other acreage.--For purposes of paragraph (1), the
Secretary shall include the following:
[[Page 116 STAT. 147]]
(A) Any base acres for peanuts for the farm under
subtitle C.
(B) Any acreage on the farm enrolled in the
conservation reserve program or wetlands reserve program
under chapter 1 of subtitle D of title XII of the Food
Security Act of 1985 (16 U.S.C. 3830 et seq.).
(C) Any other acreage on the farm enrolled in a
conservation program for which payments are made in
exchange for not producing an agricultural commodity on
the acreage.
(3) Selection of acres.--The Secretary shall give the owner
of the farm the opportunity to select the base acres or the base
acres for peanuts for the farm under subtitle C against which
the reduction required by paragraph (1) will be made.
(4) Exception for double-cropped acreage.--In applying
paragraph (1), the Secretary shall make an exception in the case
of double cropping, as determined by the Secretary.
(5) Coordinated application of requirements.--The Secretary
shall take into account section 1302(f) when applying the
requirements of this subsection.
(h) Permanent Reduction in Base Acres.--The owner of a farm may
reduce, at any time, the base acres for any covered commodity for the
farm. The reduction shall be permanent and made in the manner prescribed
by the Secretary.
SEC. 1102. ESTABLISHMENT OF PAYMENT YIELD.
(a) Establishment and Purpose.--For the purpose of making direct
payments and counter-cyclical payments under this subtitle, the
Secretary shall provide for the establishment of a payment yield for
each farm for each covered commodity in accordance with this section.
(b) Use of Farm Program Payment Yield.--Except as otherwise provided
in this section, the payment yield for each of the 2002 through 2007
crops of a covered commodity for a farm shall be the farm program
payment yield established for the 1995 crop of the covered commodity
under section 505 of the Agricultural Act of 1949 (7 U.S.C. 1465), as
adjusted by the Secretary to account for any additional yield payments
made with respect to that crop under section 505(b)(2) of that Act.
(c) Farms Without Farm Program Payment Yield.--In the case of a farm
for which a farm program payment yield is unavailable for a covered
commodity (other than soybeans or other oilseeds), the Secretary shall
establish an appropriate payment yield for the covered commodity on the
farm taking into consideration the farm program payment yields
applicable to the commodity under subsection (b) for similar farms, but
before the yields for the similar farms are updated as provided in
subsection (e).
(d) Payment Yields for Oilseeds.--
(1) Determination of average yield.--In the case of soybeans
and each other oilseed, the Secretary shall determine the
average yield per planted acre for the oilseed on a farm for the
1998 through 2001 crop years, excluding any crop year in which
the acreage planted to the oilseed was zero.
(2) Adjustment for payment yield.--The payment yield for a
farm for an oilseed shall be equal to the product of the
following:
[[Page 116 STAT. 148]]
(A) The average yield for the oilseed determined
under paragraph (1).
(B) The ratio resulting from dividing the national
average yield for the oilseed for the 1981 through 1985
crops by the national average yield for the oilseed for
the 1998 through 2001 crops.
(3) Use of partial county average yield.--If the yield per
planted acre for a crop of an oilseed for a farm for any of the
1998 through 2001 crop years was less than 75 percent of the
county yield for that oilseed, the Secretary shall assign a
yield for that crop year equal to 75 percent of the county yield
for the purpose of determining the average under paragraph (1).
(e) Opportunity to Partially Update Yields Used to Determine
Counter-Cyclical Payments.--
(1) Election to update.--If the owner of a farm elects to
use the base acres calculation method described in section
1101(a)(1)(A), the owner shall also have a 1-time opportunity to
elect to use 1 of the methods described in paragraph (3) to
partially update the payment yields that would otherwise be used
in calculating any counter-cyclical payments for covered
commodities on the farm.
(2) Time for election.--The election under paragraph (1)
shall be made at the same time and in the same manner as the
Secretary prescribes for the election required under section
1101.
(3) Methods of updating yields.--If the owner of a farm
elects to update yields under this subsection, the payment yield
for a covered commodity on the farm, for the purpose of
calculating counter-cyclical payments only, shall be equal to
the yield determined using either of the following:
(A) The sum of the following:
(i) The payment yield applicable for direct
payments for the covered commodity on the farm.
(ii) 70 percent of the difference between--
(I) the average yield per planted
acre for the crop of the covered
commodity on the farm for the 1998
through 2001 crop years, as determined
by the Secretary, excluding any crop
year in which the acreage planted to the
crop of the covered commodity was zero;
and
(II) the payment yield applicable
for direct payments for the covered
commodity on the farm.
(B) 93.5 percent of the average of the yield per
planted acre for the crop of the covered commodity on
the farm for the 1998 through 2001 crop years, as
determined by the Secretary, excluding any crop year in
which the acreage planted to the crop of the covered
commodity was zero.
(4) Use of partial county average yield.--If the yield per
planted acre for a crop of the covered commodity for a farm for
any of the 1998 through 2001 crop years was less than 75 percent
of the county yield for that commodity, the Secretary shall
assign a yield for that crop year equal to 75 percent of the
county yield for the purpose of determining the average yield
under paragraph (3).
(5) Application of election and method to all covered
commodities.--The owner of a farm may not elect the method
[[Page 116 STAT. 149]]
described in paragraph (3)(A) for 1 covered commodity on the
farm and the method described in paragraph (3)(B) for other
covered commodities on the farm.
SEC. 1103. <<NOTE: 7 USC 7913.>> AVAILABILITY OF DIRECT PAYMENTS.
(a) Payment Required.--For each of the 2002 through 2007 crop years
of each covered commodity, the Secretary shall make direct payments to
producers on farms for which payment yields and base acres are
established.
(b) Payment Rate.--The payment rates used to make direct payments
with respect to covered commodities for a crop year are as follows:
(1) Wheat, $0.52 per bushel.
(2) Corn, $0.28 per bushel.
(3) Grain sorghum, $0.35 per bushel.
(4) Barley, $0.24 per bushel.
(5) Oats, $0.024 per bushel.
(6) Upland cotton, $0.0667 per pound.
(7) Rice, $2.35 per hundredweight.
(8) Soybeans, $0.44 per bushel.
(9) Other oilseeds, $0.0080 per pound.
(c) Payment Amount.--The amount of the direct payment to be paid to
the producers on a farm for a covered commodity for a crop year shall be
equal to the product of the following:
(1) The payment rate specified in subsection (b).
(2) The payment acres of the covered commodity on the farm.
(3) The payment yield for the covered commodity for the
farm.
(d) Time for Payment.--
(1) In general.--The Secretary shall make direct payments--
(A) in the case of the 2002 crop year, as soon as
practicable after the date of enactment of this Act; and
(B) in the case of each of the 2003 through 2007
crop years, not before October 1 of the calendar year in
which the crop of the covered commodity is harvested.
(2) Advance payments.--At the option of the producers on a
farm, up to 50 percent of the direct payment for a covered
commodity for any of the 2003 through 2007 crop years shall be
paid to the producers in advance. The producers shall select the
month within which the advance payment for a crop year will be
made. The month selected may be any month during the period
beginning on December 1 of the calendar year before the calendar
year in which the crop of the covered commodity is harvested
through the month within which the direct payment would
otherwise be made. The producers may change the selected month
for a subsequent advance payment by providing advance notice to
the Secretary.
(3) Repayment of advance payments.--If a producer on a farm
that receives an advance direct payment for a crop year ceases
to be a producer on that farm, or the extent to which the
producer shares in the risk of producing a crop changes, before
the date the remainder of the direct payment is made, the
producer shall be responsible for repaying the Secretary the
applicable amount of the advance payment, as determined by the
Secretary.
[[Page 116 STAT. 150]]
SEC. 1104. <<NOTE: 7 USC 7914.>> AVAILABILITY OF COUNTER-CYCLICAL
PAYMENTS.
(a) Payment Required.--For each of the 2002 through 2007 crop years
for each covered commodity, the Secretary shall make counter-cyclical
payments to producers on farms for which payment yields and base acres
are established with respect to the covered commodity if the Secretary
determines that the effective price for the covered commodity is less
than the target price for the covered commodity.
(b) Effective Price.--For purposes of subsection (a), the effective
price for a covered commodity is equal to the sum of the following:
(1) The higher of the following:
(A) The national average market price received by
producers during the 12-month marketing year for the
covered commodity, as determined by the Secretary.
(B) The national average loan rate for a marketing
assistance loan for the covered commodity in effect for
the applicable period under subtitle B.
(2) The payment rate in effect for the covered commodity
under section 1103 for the purpose of making direct payments
with respect to the covered commodity.
(c) Target Price.--
(1) 2002 and 2003 crop years.--For purposes of the 2002 and
2003 crop years, the target prices for covered commodities shall
be as follows:
(A) Wheat, $3.86 per bushel.
(B) Corn, $2.60 per bushel.
(C) Grain sorghum, $2.54 per bushel.
(D) Barley, $2.21 per bushel.
(E) Oats, $1.40 per bushel.
(F) Upland cotton, $0.7240 per pound.
(G) Rice, $10.50 per hundredweight.
(H) Soybeans, $5.80 per bushel.
(I) Other oilseeds, $0.0980 per pound.
(2) Subsequent crop years.--For purposes of each of the 2004
through 2007 crop years, the target prices for covered
commodities shall be as follows:
(A) Wheat, $3.92 per bushel.
(B) Corn, $2.63 per bushel.
(C) Grain sorghum, $2.57 per bushel.
(D) Barley, $2.24 per bushel.
(E) Oats, $1.44 per bushel.
(F) Upland cotton, $0.7240 per pound.
(G) Rice, $10.50 per hundredweight.
(H) Soybeans, $5.80 per bushel.
(I) Other oilseeds, $0.1010 per pound.
(d) Payment Rate.--The payment rate used to make counter-cyclical
payments with respect to a covered commodity for a crop year shall be
equal to the difference between--
(1) the target price for the covered commodity; and
(2) the effective price determined under subsection (b) for
the covered commodity.
(e) Payment Amount.--If counter-cyclical payments are required to be
paid for any of the 2002 through 2007 crop years of a covered commodity,
the amount of the counter-cyclical payment to be paid to the producers
on a farm for that crop year shall be equal to the product of the
following:
[[Page 116 STAT. 151]]
(1) The payment rate specified in subsection (d).
(2) The payment acres of the covered commodity on the farm.
(3) The payment yield or updated payment yield for the farm,
depending on the election of the owner of the farm under section
1102.
(f) Time for Payments.--
(1) General rule.--If the Secretary determines under
subsection (a) that counter-cyclical payments are required to be
made under this section for the crop of a covered commodity, the
Secretary shall make the counter-cyclical payments for the crop
as soon as practicable after the end of the 12-month marketing
year for the covered commodity.
(2) Availability of partial payments.--If, before the end of
the 12-month marketing year for a covered commodity, the
Secretary estimates that counter-cyclical payments will be
required for the crop of the covered commodity, the Secretary
shall give producers on a farm the option to receive partial
payments of the counter-cyclical payment projected to be made
for that crop of the covered commodity.
(3) Time for partial payments.--
(A) 2002 through 2006 crop years.--When the
Secretary makes partial payments available under
paragraph (2) for a covered commodity for any of the
2002 through 2006 crop years--
(i) the first partial payment for the crop
year shall be made not earlier than October 1,
and, to the maximum extent practicable, not later
than October 31, of the calendar year in which the
crop of the covered commodity is harvested;
(ii) the second partial payment shall be made
not earlier than February 1 of the next calendar
year; and
(iii) the final partial payment shall be made
as soon as practicable after the end of the 12-
month marketing year for the covered commodity.
(B) 2007 crop year.--When the Secretary makes
partial payments available for a covered commodity for
the 2007 crop year--
(i) the first partial payment shall be made
after completion of the first 6 months of the
marketing year for the covered commodity; and
(ii) the final partial payment shall be made
as soon as practicable after the end of the 12-
month marketing year for the covered commodity.
(4) Amount of partial payments.--
(A) 2002 through 2006 crop years.--
(i) First partial payment.--For each of the
2002 through 2006 crop years of a covered
commodity, the first partial payment under
paragraph (3) to the producers on a farm may not
exceed 35 percent of the projected counter-
cyclical payment for the covered commodity for the
crop year, as determined by the Secretary.
(ii) Second partial payment.--The second
partial payment for a covered commodity for a crop
year may not exceed the difference between--
[[Page 116 STAT. 152]]
(I) 70 percent of the projected
counter-cyclical payment (including any
revision thereof) for the crop of the
covered commodity; and
(II) the amount of the payment made
under clause (i).
(iii) Final payment.--The final payment for a
covered commodity for a crop year shall be equal
to the difference between--
(I) the actual counter-cyclical
payment to be made to the producers for
the covered commodity for that crop
year; and
(II) the amount of the partial
payments made to the producers under
clauses (i) and (ii) for that crop year.
(B) 2007 crop year.--
(i) First partial payment.--For the 2007 crop
year, the first partial payment under paragraph
(3) to the producers on a farm may not exceed 40
percent of the projected counter-cyclical payment
for the covered commodity for the crop year, as
determined by the Secretary.
(ii) Final payment.--The final payment for the
2007 crop year shall be equal to the difference
between--
(I) the actual counter-cyclical
payment to be made to the producers for
the covered commodity for that crop
year; and
(II) the amount of the partial
payment made to the producers under
clause (i).
(5) Repayment.--The producers on a farm that receive a
partial payment under this subsection for a crop year shall
repay to the Secretary the amount, if any, by which the total of
the partial payments exceed the actual counter-cyclical payment
to be made for the covered commodity for that crop year.
SEC. 1105. <<NOTE: 7 USC 7915.>> PRODUCER AGREEMENT REQUIRED AS
CONDITION OF PROVISION OF DIRECT PAYMENTS AND COUNTER-
CYCLICAL PAYMENTS.
(a) Compliance With Certain Requirements.--
(1) Requirements.--Before the producers on a farm may
receive direct payments or counter-cyclical payments with
respect to the farm, the producers shall agree, during the crop
year for which the payments are made and in exchange for the
payments--
(A) to comply with applicable conservation
requirements under subtitle B of title XII of the Food
Security Act of 1985 (16 U.S.C. 3811 et seq.);
(B) to comply with applicable wetland protection
requirements under subtitle C of title XII of the Act
(16 U.S.C. 3821 et seq.);
(C) to comply with the planting flexibility
requirements of section 1106;
(D) to use the land on the farm, in a quantity equal
to the attributable base acres for the farm and any base
acres for peanuts for the farm under subtitle C for an
[[Page 116 STAT. 153]]
agricultural or conserving use, and not for a
nonagricultural commercial or industrial use, as
determined by the Secretary; and
(E) to effectively control noxious weeds and
otherwise maintain the land in accordance with sound
agricultural practices, as determined by the Secretary,
if the agricultural or conserving use involves the
noncultivation of any portion of the land referred to in
subparagraph (D).
(2) Compliance.--The Secretary may issue such rules as the
Secretary considers necessary to ensure producer compliance with
the requirements of paragraph (1).
(3) Modification.--At the request of the transferee or
owner, the Secretary may modify the requirements of this
subsection if the modifications are consistent with the
objectives of this subsection, as determined by the Secretary.
(b) Transfer or Change of Interest in Farm.--
(1) Termination.--Except as provided in paragraph (2), a
transfer of (or change in) the interest of the producers on a
farm in base acres for which direct payments or counter-cyclical
payments are made shall result in the termination of the
payments with respect to the base acres, unless the transferee
or owner of the acreage agrees to assume all obligations under
subsection (a). The termination shall take effect on the date
determined by the Secretary.
(2) Exception.--If a producer entitled to a direct payment
or counter-cyclical payment dies, becomes incompetent, or is
otherwise unable to receive the payment, the Secretary shall
make the payment, in accordance with rules issued by the
Secretary.
(c) Acreage Reports.--As a condition on the receipt of any benefits
under this subtitle or subtitle B, the Secretary shall require producers
on a farm to submit to the Secretary annual acreage reports with respect
to all cropland on the farm.
(d) Tenants and Sharecroppers.--In carrying out this subtitle, the
Secretary shall provide adequate safeguards to protect the interests of
tenants and sharecroppers.
(e) Sharing of Payments.--The Secretary shall provide for the
sharing of direct payments and counter-cyclical payments among the
producers on a farm on a fair and equitable basis.
SEC. 1106. <<NOTE: 7 USC 7916.>> PLANTING FLEXIBILITY.
(a) Permitted Crops.--Subject to subsection (b), any commodity or
crop may be planted on base acres on a farm.
(b) Limitations Regarding Certain Commodities.--
(1) General limitation.--The planting of an agricultural
commodity specified in paragraph (3) shall be prohibited on base
acres unless the commodity, if planted, is destroyed before
harvest.
(2) Treatment of trees and other perennials.--The planting
of an agricultural commodity specified in paragraph (3) that is
produced on a tree or other perennial plant shall be prohibited
on base acres.
(3) Covered agricultural commodities.--Paragraphs (1) and
(2) apply to the following agricultural commodities:
(A) Fruits.
(B) Vegetables (other than lentils, mung beans, and
dry peas).
[[Page 116 STAT. 154]]
(C) Wild rice.
(c) Exceptions.--Paragraphs (1) and (2) of subsection (b) shall not
limit the planting of an agricultural commodity specified in paragraph
(3) of that subsection--
(1) in any region in which there is a history of double-
cropping of covered commodities with agricultural commodities
specified in subsection (b)(3), as determined by the Secretary,
in which case the double-cropping shall be permitted;
(2) on a farm that the Secretary determines has a history of
planting agricultural commodities specified in subsection (b)(3)
on base acres, except that direct payments and counter-cyclical
payments shall be reduced by an acre for each acre planted to
such an agricultural commodity; or
(3) by the producers on a farm that the Secretary determines
has an established planting history of a specific agricultural
commodity specified in subsection (b)(3), except that--
(A) the quantity planted may not exceed the average
annual planting history of such agricultural commodity
by the producers on the farm in the 1991 through 1995 or
1998 through 2001 crop years (excluding any crop year in
which no plantings were made), as determined by the
Secretary; and
(B) direct payments and counter-cyclical payments
shall be reduced by an acre for each acre planted to
such agricultural commodity.
(d) Special Rule for 2002 Crop Year.--For the 2002 crop year only,
if the calculation of base acres under section 1101(a) results in total
base acres for a farm in excess of the contract acreage (as defined in
section 102 of the Federal Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7202)) for the farm used to calculate the fiscal year
2002 payment authorized under section 114 of such Act (7 U.S.C. 7214),
paragraphs (1) and (2) of subsection (b) shall not limit the harvesting
of an agricultural commodity specified in paragraph (3) of that
subsection on the excess base acres, except that direct payments and
counter-cyclical payments for the 2002 crop year shall be reduced by an
acre for each acre of the excess base acres planted to such an
agricultural commodity.
SEC. 1107. <<NOTE: 7 USC 7917.>> RELATION TO REMAINING PAYMENT
AUTHORITY UNDER PRODUCTION FLEXIBILITY CONTRACTS.
(a) Termination of Superseded Payment Authority.--Notwithstanding
section 113(a)(7) of the Federal Agriculture Improvement and Reform Act
of 1996 (7 U.S.C. 7213(a)(7)) or any other provision of law, the
Secretary shall not make payments for fiscal year 2002 after the date of
enactment of this Act under a production flexibility contract entered
into under section 111 of that Act (7 U.S.C. 7211) unless requested by
the producer that is a party to the contract.
(b) Contract Payments Made Before Enactment.--If a producer receives
all or any portion of the payment authorized for fiscal year 2002 under
a production flexibility contract, the Secretary shall reduce the amount
of the direct payment otherwise due the producer for the 2002 crop year
under section 1103 by the amount of the fiscal year 2002 payment
received by the producer under the production flexibility contract.
[[Page 116 STAT. 155]]
SEC. 1108. <<NOTE: 7 USC 7918.>> PERIOD OF EFFECTIVENESS.
This subtitle shall be effective beginning with the 2002 crop year
of each covered commodity through the 2007 crop year.
Subtitle B--Marketing Assistance Loans and Loan Deficiency Payments
SEC. 1201. <<NOTE: 7 USC 7931.>> AVAILABILITY OF NONRECOURSE MARKETING
ASSISTANCE LOANS FOR LOAN COMMODITIES.
(a) Nonrecourse Loans Available.--
(1) Availability.--For each of the 2002 through 2007 crops
of each loan commodity, the Secretary shall make available to
producers on a farm nonrecourse marketing assistance loans for
loan commodities produced on the farm.
(2) Terms and conditions.--The marketing assistance loans
shall be made under terms and conditions that are prescribed by
the Secretary and at the loan rate established under section
1202 for the loan commodity.
(b) Eligible Production.--The producers on a farm shall be eligible
for a marketing assistance loan under subsection (a) for any quantity of
a loan commodity produced on the farm.
(c) Treatment of Certain Commingled Commodities.--In carrying out
this subtitle, the Secretary shall make loans to producers on a farm
that would be eligible to obtain a marketing assistance loan, but for
the fact the loan commodity owned by the producers on the farm
commingled with loan commodities of other producers in facilities
unlicensed for the storage of agricultural commodities by the Secretary
or a State licensing authority, if the producers obtaining the loan
agree to immediately redeem the loan collateral in accordance with
section 166 of the Federal Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7286).
(d) Compliance With Conservation and Wetlands Requirements.--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.
(e) Termination of Superseded Loan Authority.--Notwithstanding
section 131 of the Federal Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7231), nonrecourse marketing assistance loans shall not
be made for the 2002 crop of loan commodities under subtitle C of title
I of such Act.
SEC. 1202. <<NOTE: 7 USC 7932.>> LOAN RATES FOR NONRECOURSE MARKETING
ASSISTANCE LOANS.
(a) 2002 and 2003 Crop Years.--For purposes of the 2002 and 2003
crop years, the loan rate for a marketing assistance loan under section
1201 for a loan commodity shall be equal to the following:
(1) In the case of wheat, $2.80 per bushel.
(2) In the case of corn, $1.98 per bushel.
(3) In the case of grain sorghum, $1.98 per bushel.
(4) In the case of barley, $1.88 per bushel.
(5) In the case of oats, $1.35 per bushel.
(6) In the case of upland cotton, $0.52 per pound.
[[Page 116 STAT. 156]]
(7) In the case of extra long staple cotton, $0.7977 per
pound.
(8) In the case of rice, $6.50 per hundredweight.
(9) In the case of soybeans, $5.00 per bushel.
(10) In the case of other oilseeds, $0.0960 per pound.
(11) In the case of graded wool, $1.00 per pound.
(12) In the case of nongraded wool, $0.40 per pound.
(13) In the case of mohair, $4.20 per pound.
(14) In the case of honey, $0.60 per pound.
(15) In the case of dry peas, $6.33 per hundredweight.
(16) In the case of lentils, $11.94 per hundredweight.
(17) In the case of small chickpeas, $7.56 per
hundredweight.
(b) 2004 Through 2007 crop Years.--For purposes of the 2004 through
2007 crop years, the loan rate for a marketing assistance loan under
section 1201 for a loan commodity shall be equal to the following:
(1) In the case of wheat, $2.75 per bushel.
(2) In the case of corn, $1.95 per bushel.
(3) In the case of grain sorghum, $1.95 per bushel.
(4) In the case of barley, $1.85 per bushel.
(5) In the case of oats, $1.33 per bushel.
(6) In the case of upland cotton, $0.52 per pound.
(7) In the case of extra long staple cotton, $0.7977 per
pound.
(8) In the case of rice, $6.50 per hundredweight.
(9) In the case of soybeans, $5.00 per bushel.
(10) In the case of other oilseeds, $0.0930 per pound.
(11) In the case of graded wool, $1.00 per pound.
(12) In the case of nongraded wool, $0.40 per pound.
(13) In the case of mohair, $4.20 per pound.
(14) In the case of honey, $0.60 per pound.
(15) In the case of dry peas, $6.22 per hundredweight.
(16) In the case of lentils, $11.72 per hundredweight.
(17) In the case of small chickpeas, $7.43 per
hundredweight.
SEC. 1203. <<NOTE: 7 USC 7933.>> TERM OF LOANS.
(a) Term of Loan.--In the case of each loan commodity, a marketing
assistance loan under section 1201 shall have a term of 9 months
beginning on the first day of the first month after the month in which
the loan is made.
(b) Extensions Prohibited.--The Secretary may not extend the term of
a marketing assistance loan for any loan commodity.
SEC. 1204. <<NOTE: 7 USC 7934.>> REPAYMENT OF LOANS.
(a) General Rule.--The Secretary shall permit the producers on a
farm to repay a marketing assistance loan under section 1201 for a loan
commodity (other than upland cotton, rice, and extra long staple cotton)
at a rate that is the lesser of--
(1) the loan rate established for the commodity under
section 1202, plus interest (determined in accordance with
section 163 of the Federal Agriculture Improvement and Reform
Act of 1996 (7 U.S.C. 7283)); or
(2) a rate that the Secretary determines will--
(A) minimize potential loan forfeitures;
(B) minimize the accumulation of stocks of the
commodity by the Federal Government;
[[Page 116 STAT. 157]]
(C) minimize the cost incurred by the Federal
Government in storing the commodity;
(D) allow the commodity produced in the United
States to be marketed freely and competitively, both
domestically and internationally; and
(E) minimize discrepancies in marketing loan
benefits across State boundaries and across county
boundaries.
(b) Repayment Rates for Upland Cotton and Rice.--The Secretary shall
permit producers to repay a marketing assistance loan under section 1201
for upland cotton and rice at a rate that is the lesser of--
(1) the loan rate established for the commodity under
section 1202, plus interest (determined in accordance with
section 163 of the Federal Agriculture Improvement and Reform
Act of 1996 (7 U.S.C. 7283)); 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 1202, plus
interest (determined in accordance with section 163 of the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7283)).
(d) Prevailing World Market <<NOTE: Regulations.>> Price.--For
purposes of this section and section 1207, the Secretary shall prescribe
by regulation--
(1) a formula to determine the prevailing world market price
for upland cotton and rice, adjusted to United States quality
and location; and
(2) a mechanism by which the Secretary shall announce
periodically the prevailing world market price for upland cotton
and rice.
(e) Adjustment of Prevailing World Market Price for Upland Cotton.--
(1) In general.--During the period beginning on the date of
the enactment of this Act through July 31, 2008, the prevailing
world market price for upland cotton (adjusted to United States
quality and location) established under subsection (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
established under section 1202, as determined by the
Secretary; and
(B) the Friday through Thursday average price
quotation for the lowest-priced United States growth as
quoted for Middling (M) 1\3/32\-inch cotton delivered
C.I.F. Northern Europe is greater than the Friday
through Thursday average price of the 5 lowest-priced
growths of upland cotton, as quoted for Middling (M)
1\3/32\-inch cotton, delivered C.I.F. Northern Europe
(referred to in this section as the ``Northern Europe
price'').
(2) Further adjustment.--Except as provided in paragraph
(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.
[[Page 116 STAT. 158]]
(B) The current level of cotton export sales and
cotton export shipments.
(C) Other data determined by the Secretary to be
relevant 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
Middling 1\3/32\-inch cotton delivered C.I.F. Northern
Europe; and
(B) the Northern Europe price.
(f) Good Faith Exception to Beneficial Interest Requirement.--For
the 2001 crop year only, in the case of the producers on a farm that
marketed or otherwise lost beneficial interest in a loan commodity for
which a marketing assistance loan was made under section 131 of the
Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7231)
before repaying the loan, the Secretary shall permit the producers to
repay the loan at the appropriate repayment rate that was in effect for
the loan commodity under section 134 of that Act (7 U.S.C. 7234) on the
date that the producers lost beneficial interest, as determined by the
Secretary, if the Secretary determines the producers acted in good
faith.
SEC. 1205. <<NOTE: 7 USC 7935.>> LOAN DEFICIENCY PAYMENTS.
(a) Availability of Loan Deficiency Payments.--
(1) In general.--Except as provided in subsection (d), the
Secretary may make loan deficiency payments available to
producers on a farm that, although eligible to obtain a
marketing assistance loan under section 1201 with respect to a
loan commodity, agree to forgo obtaining the loan for the
commodity in return for loan deficiency payments under this
section.
(2) Unshorn pelts, hay, and silage.--Nongraded wool in the
form of unshorn pelts and hay and silage derived from a loan
commodity are not eligible for a marketing assistance loan under
section 1201. However, effective for the 2002 through 2007 crop
years, the Secretary may make loan deficiency payments available
under this section to producers on a farm that produce unshorn
pelts or hay and silage derived from a loan commodity.
(b) Computation.--A loan deficiency payment for a loan commodity or
commodity referred to in subsection (a)(2) shall be computed by
multiplying--
(1) the payment rate determined under subsection (c) for the
commodity; by
(2) the quantity of the commodity produced by the eligible
producers, excluding any quantity for which the producers obtain
a marketing assistance loan under section 1201.
(c) Payment Rate.--
(1) In general.--In the case of a loan commodity, the
payment rate shall be the amount by which--
(A) the loan rate established under section 1202 for
the loan commodity; exceeds
(B) the rate at which a marketing assistance loan
for the loan commodity may be repaid under section 1204.
[[Page 116 STAT. 159]]
(2) Unshorn pelts.--In the case of unshorn pelts, the
payment rate shall be the amount by which--
(A) the loan rate established under section 1202 for
ungraded wool; exceeds
(B) the rate at which a marketing assistance loan
for ungraded wool may be repaid under section 1204.
(3) hay and silage.--In the case of hay or silage derived
from a loan commodity, the payment rate shall be the amount by
which--
(A) the loan rate established under section 1202 for
the loan commodity from which the hay or silage is
derived; exceeds
(B) the rate at which a marketing assistance loan
for the loan commodity may be repaid under section 1204.
(d) Exception for Extra Long Staple Cotton.--This section shall not
apply with respect to extra long staple cotton.
(e) Effective Date for Payment Rate Determination.--The Secretary
shall determine the amount of the loan deficiency payment to be made
under this section to the producers on a farm with respect to a quantity
of a loan commodity or commodity referred to in subsection (a)(2) using
the payment rate in effect under subsection (c) as of the date the
producers request the payment.
(f) Special Loan Deficiency Payment Rules.--
(1) First-time loan commodities.--For the 2002 crop of wool,
mohair, honey, dry peas, lentils and small chickpeas, in the
case of producers of such a crop that would be eligible for a
loan deficiency payment under this section except for the fact
that the producers lost beneficial interest in the crop prior to
the date of publication of the regulations implementing this
section, the producers shall be eligible for a loan deficiency
payment as of the date producers marketed or otherwise lost
beneficial interest in the crop, as determined by the Secretary.
(2) 2001 crop year.--Section 135 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7235) is amended--
(A) in subsection (a)(2), by striking ``2000 crop
year'' and inserting ``2000 and 2001 crop years''; and
(B) by adding at the end the following:
``(g) Effective Date for Payment Rate Determination.--For the 2001
crop year, the Secretary shall determine the amount of the loan
deficiency payment to be made under this section to the producers on a
farm with respect to a quantity of a loan commodity using the payment
rate in effect under subsection (c) as of the earlier of the following:
``(1) The date on which the producers marketed or otherwise
lost beneficial interest in the crop of the loan commodity, as
determined by the Secretary.
``(2) The date the producers requested the payment.''.
SEC. 1206. <<NOTE: 7 USC 7936.>> PAYMENTS IN LIEU OF LOAN DEFICIENCY
PAYMENTS FOR GRAZED ACREAGE.
(a) Eligible Producers.--
(1) In general.--Effective for the 2002 through 2007 crop
years, in the case of a producer that would be eligible for a
loan deficiency payment under section 1205 for wheat, barley, or
oats, but that elects to use acreage planted to the wheat,
[[Page 116 STAT. 160]]
barley, or oats for the grazing of livestock, the Secretary
shall make a payment to the producer under this section if the
producer enters into an agreement with the Secretary to forgo
any other harvesting of the wheat, barley, or oats on that
acreage.
(2) Grazing of triticale acreage.--Effective for the 2002
through 2007 crop years, with respect to a producer on a farm
that uses acreage planted to triticale for the grazing of
livestock, the Secretary shall make a payment to the producer
under this section if the producer enters into an agreement with
the Secretary to forgo any other harvesting of triticale on that
acreage.
(b) Payment Amount.--
(1) In general.--The amount of a payment made under this
section to a producer on a farm described in subsection (a)(1)
shall be equal to the amount determined by multiplying--
(A) the loan deficiency payment rate determined
under section 1205(c) in effect, as of the date of the
agreement, for the county in which the farm is located;
by
(B) the payment quantity determined by multiplying--
(i) the quantity of the grazed acreage on the
farm with respect to which the producer elects to
forgo harvesting of wheat, barley, or oats; and
(ii) the payment yield in effect for the
calculation of direct payments under subtitle A
with respect to that loan commodity on the farm
or, in the case of a farm without a payment yield
for that loan commodity, an appropriate yield
established by the Secretary in a manner
consistent with section 1102(c).
(2) Grazing of triticale acreage.--The amount of a payment
made under this section to a producer on a farm described in
subsection (a)(2) shall be equal to the amount determined by
multiplying--
(A) the loan deficiency payment rate determined
under section 1205(c) in effect for wheat, as of the
date of the agreement, for the county in which the farm
is located; by
(B) the payment quantity determined by multiplying--
(i) the quantity of the grazed acreage on the
farm with respect to which the producer elects to
forgo harvesting of triticale; and
(ii) the payment yield in effect for the
calculation of direct payments under subtitle A
with respect to wheat on the farm or, in the case
of a farm without a payment yield for wheat, an
appropriate yield established by the Secretary in
a manner consistent with section 1102(c).
(c) Time, Manner, and Availability of Payment.--
(1) Time and manner.--A payment under this section shall be
made at the same time and in the same manner as loan deficiency
payments are made under section 1205.
(2) Availability.--The Secretary shall establish an
availability period for the payments authorized by this section.
In the case of wheat, barley, and oats, the availability period
shall be consistent with the availability period for the
commodity established by the Secretary for marketing assistance
loans authorized by this subtitle.
[[Page 116 STAT. 161]]
(d) Prohibition on Crop Insurance Indemnity or Noninsured Crop
Assistance.--A 2002 through 2007 crop of wheat, barley, oats, or
triticale planted on acreage that a producer elects, in the agreement
required by subsection (a), to use for the grazing of livestock in lieu
of any other harvesting of the crop shall not be eligible for an
indemnity under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.)
or noninsured crop assistance under section 196 of the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333).
SEC. 1207. <<NOTE: 7 USC 7937.>> SPECIAL MARKETING LOAN PROVISIONS FOR
UPLAND COTTON.
(a) Cotton User Marketing Certificates.--
(1) Issuance.--During the period beginning on the date of
the enactment of this Act through July 31, 2008, the Secretary
shall issue marketing certificates or cash payments, at the
option of the recipient, to domestic users and exporters for
documented purchases by domestic users and sales for 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\3/32\-inch cotton, delivered
C.I.F. 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 134 percent of the loan rate for upland
cotton established under section 1202.
(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 fourth 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
Secretary shall establish procedures for redeeming
marketing certificates for cash or marketing or exchange
of the certificates for agricultural commodities owned
by the Commodity Credit Corporation or pledged to the
Commodity Credit Corporation as collateral for a loan in
such manner, and at such price levels, as the Secretary
determines will best effectuate the purposes of cotton
user marketing certificates, including enhancing the
competitiveness and marketability of United States
cotton. Any price restrictions that would otherwise
apply to the disposition 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
(C) Transfers.--Marketing certificates issued to
domestic users and exporters of upland cotton may be
[[Page 116 STAT. 162]]
transferred to other persons in accordance with
regulations issued by the Secretary.
(4) Delayed application of threshold.--Through July 31,
2006, the Secretary shall make the calculations under paragraphs
(1)(A) and (2) without regard to the 1.25 cent threshold
provided under those paragraphs.
(b) Special Import Quota.--
(1) Establishment.--
(A) In general.--The President shall carry out an
import quota program during the period beginning on the
date of the enactment of this Act through July 31, 2008,
as provided in this subsection.
(B) Program requirements.--Except as provided in
subparagraph (C), whenever the Secretary determines and
announces that for any consecutive 4-week period, the
Friday through Thursday average price quotation for the
lowest-priced United States growth, as quoted for
Middling (M) 1\3/32\-inch cotton, delivered C.I.F.
Northern Europe, adjusted for the value of any
certificate 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.
(C) Tight domestic supply.--During any month for
which the Secretary estimates the season-ending United
States upland cotton stocks-to-use ratio, as determined
under subparagraph (D), to be below 16 percent, the
Secretary, in making the determination under
subparagraph (B), shall not adjust the Friday through
Thursday average price quotation for the lowest-priced
United States growth, as quoted for Middling (M) 1\3/
32\-inch cotton, delivered C.I.F. Northern Europe, for
the value of any certificates issued under subsection
(a).
(D) Season-ending united states stocks-to-use
ratio.--For the purposes of making estimates under
subparagraph (C), the Secretary shall, on a monthly
basis, estimate and report the season-ending United
States upland cotton stocks-to-use ratio, excluding
projected raw cotton imports but including the quantity
of raw cotton that has been imported into the United
States during the marketing year.
(E) Delayed application of threshold.--Through July
31, 2006, the Secretary shall make the calculation under
subparagraph (B) without regard to the 1.25 cent
threshold provided under that subparagraph.
(2) Quantity.--The quota shall be equal to one week's
consumption of upland cotton by domestic mills at the seasonally
adjusted average rate of the most recent three months for which
data are available.
(3) Application.--The <<NOTE: Deadlines.>> quota shall apply
to upland cotton purchased not later than 90 days after the date
of the Secretary'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).
[[Page 116 STAT. 163]]
(5) Preferential 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.
(7) Limitation.--The quantity of cotton entered into the
United States during any marketing year under the special import
quota established under this subsection may not exceed the
equivalent of 5 week's consumption of upland cotton by domestic
mills at the seasonally adjusted average rate of the 3 months
immediately preceding the first special import quota established
in any marketing year.
(c) Limited Global Import Quota for Upland Cotton.--
(1) In general.--The President shall carry out an import
quota program that provides that whenever the Secretary
determines and announces that the average price of the base
quality of upland cotton, as determined by the Secretary, in the
designated 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 provision 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) Quantity if prior quota.--If a quota has been
established under this subsection during the preceding
12 months, the quantity of the quota next established
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
[[Page 116 STAT. 164]]
Department of Agriculture, and the Department of
the Treasury--
(I) the carry-over of upland cotton
at the beginning 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 during the
preceding 6 marketing years; or
(bb) cumulative exports of
upland cotton plus outstanding
export sales for the marketing
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 established
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).
SEC. 1208. <<NOTE: 7 USC 7938.>> SPECIAL COMPETITIVE PROVISIONS FOR
EXTRA LONG STAPLE COTTON.
(a) Competitiveness Program.--Notwithstanding any other provision of
law, during the period beginning on the date of the enactment of this
Act through July 31, 2008, the Secretary shall carry out a program--
(1) to maintain and expand the domestic use of extra long
staple cotton produced in the United States;
(2) to increase exports of extra long staple cotton produced
in the United States; and
(3) to ensure that extra long staple cotton produced in the
United States remains competitive in world markets.
(b) Payments Under Program; Trigger.--Under the program, the
Secretary shall make payments available under this section whenever--
(1) for a consecutive 4-week period, the world market price
for the lowest priced competing growth of extra long staple
cotton (adjusted to United States quality and location and for
other factors affecting the competitiveness of such cotton), as
determined by the Secretary, is below the prevailing United
States price for a competing growth of extra long staple cotton;
and
(2) the lowest priced competing growth of extra long staple
cotton (adjusted to United States quality and location and for
other factors affecting the competitiveness of such cotton),
[[Page 116 STAT. 165]]
as determined by the Secretary, is less than 134 percent of the
loan rate for extra long staple cotton.
(c) Eligible Recipients.--The Secretary shall make payments
available under this section to domestic users of extra long staple
cotton produced in the United States and exporters of extra long staple
cotton produced in the United States that enter into an agreement with
the Commodity Credit Corporation to participate in the program under
this section.
(d) Payment Amount.--Payments under this section shall be based on
the amount of the difference in the prices referred to in subsection
(b)(1) during the fourth week of the consecutive 4-week period
multiplied by the amount of documented purchases by domestic users and
sales for export by exporters made in the week following such a
consecutive 4-week period.
(e) Form of Payment.--Payments under this section shall be made
through the issuance of cash or marketing certificates, at the option of
eligible recipients of the payments.
SEC. 1209. <<NOTE: 7 USC 7939.>> 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 2002 through
2007 crops of corn and grain sorghum, the Secretary shall make
available recourse loans, as determined by the Secretary, to
producers on a farm that--
(A) normally harvest all or a portion of their crop
of corn or grain sorghum in a high moisture state;
(B) present--
(i) certified scale tickets from an inspected,
certified 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 certified commercial scales from
which certified scale tickets 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 harvested 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 corn and grain sorghum in a high moisture
state; and
(D) comply with deadlines established by the
Secretary for harvesting the corn or grain sorghum and
submit applications for loans under this subsection
within deadlines established by the Secretary.
(2) Eligibility of acquired feed grains.--A loan under this
subsection shall be made on a quantity of corn 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
[[Page 116 STAT. 166]]
(B) the lower of the farm program payment yield used
to make counter-cyclical payments under subtitle A or
the actual yield on a field, as determined by the
Secretary, that is similar to the field from which the
corn or grain sorghum was obtained.
(3) High moisture state defined.--In this subsection, the
term ``high moisture state'' means corn or grain sorghum having
a moisture content in excess of Commodity Credit Corporation
standards for marketing assistance loans made by the Secretary
under section 1201.
(b) Recourse Loans Available for Seed Cotton.--For each of the 2002
through 2007 crops of upland cotton and extra long staple cotton, the
Secretary shall make available recourse seed cotton loans, as determined
by the Secretary, on any production.
(c) Repayment Rates.--Repayment of a recourse loan made under this
section shall be at the loan rate established for the commodity by the
Secretary, plus interest (determined in accordance with section 163 of
the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C.
7283)).
(d) Termination of Superseded Loan Authority.--Notwithstanding
section 137 of the Federal Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7237), recourse loans shall not be made for the 2002 crop
of corn, grain sorghum, and seed cotton under such section.
Subtitle C--Peanuts
SEC. 1301. <<NOTE: 7 USC 7951.>> DEFINITIONS.
In this subtitle:
(1) Base acres for peanuts.--The term ``base acres for
peanuts'' means the number of acres assigned to a farm by
historic peanut producers pursuant to section 1302(b).
(2) Counter-cyclical payment.--The term ``counter-cyclical
payment'' means a payment made under section 1304.
(3) Effective price.--The term ``effective price'' means the
price calculated by the Secretary under section 1304 for peanuts
to determine whether counter-cyclical payments are required to
be made under that section for a crop year.
(4) Direct payment.--The term ``direct payment'' means a
payment made under section 1303.
(5) Historic peanut producer.--The term ``historic peanut
producer'' means a producer on a farm in the United States that
produced or was prevented from planting peanuts during any or
all of the 1998 through 2001 crop years.
(6) Payment acres.--The term ``payment acres'' means--
(A) for the 2002 crop of peanuts, 85 percent of the
average acreage determined under section 1302(a)(2) for
an historic peanut producer; and
(B) for the 2003 through 2007 crops of peanuts, 85
percent of the base acres for peanuts assigned to a farm
under section 1302(b).
(7) Payment yield.--The term ``payment yield'' means the
yield assigned to a farm by historic peanut producers pursuant
to section 1302(b).
(8) Producer.--The term ``producer'' means an owner,
operator, landlord, tenant, or sharecropper that shares in the
[[Page 116 STAT. 167]]
risk of producing a crop on a farm and is entitled to share in
the crop available for marketing from the farm, or would have
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 contract
and shall ensure that program requirements do not adversely
affect the ability of the grower to receive a payment under this
subtitle.
(9) Secretary.--The term ``Secretary'' means the Secretary
of Agriculture.
(10) 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.
(11) Target price.--The term ``target price'' means the
price per ton of peanuts used to determine the payment rate for
counter-cyclical payments.
(12) United states.--The term ``United States'', when used
in a geographical sense, means all of the States.
SEC. 1302. <<NOTE: 7 USC 7952.>> ESTABLISHMENT OF PAYMENT YIELD AND
BASE ACRES FOR PEANUTS FOR A FARM.
(a) Average Yield and Acreage Average for Historic Peanut
Producers.--
(1) Determination of average yield.--
(A) In general.--The Secretary shall determine, for
each historic peanut producer, the average yield for
peanuts on each farm on which the historic peanut
producer planted peanuts for harvest for the 1998
through 2001 crop years, excluding any crop year in
which the producer did not plant or was prevented from
planting peanuts.
(B) Assigned yields.--For the purposes of
determining the 4-year average yield for an historic
peanut producer under this paragraph, the historic
peanut producer may elect to substitute for a farm, for
not more than 3 of the 1998 through 2001 crop years in
which the producer planted peanuts on the farm, the
average yield for peanuts produced in the county in
which the farm is located for the 1990 through 1997 crop
years.
(2) Determination of acreage average.--
(A) In general.--The Secretary shall determine, for
each historic peanut producer, the 4-year average of the
following:
(i) Acreage planted to peanuts on each farm on
which the historic peanut producer planted peanuts
for harvest for the 1998 through 2001 crop years.
(ii) Any acreage on each farm that the
historic peanut producer was prevented from
planting to peanuts during the 1998 through 2001
crop years because of drought, flood, or other
natural disaster, or other condition beyond the
control of the historic peanut producer, as
determined by the Secretary.
(B) Inclusion of all 4 years in average.--For the
purposes of determining the 4-year acreage average for
an historic peanut producer under this paragraph, the
Secretary shall not exclude any crop year in which the
producer did not plant peanuts.
[[Page 116 STAT. 168]]
(C) Proportional shares.--If more than 1 historic
peanut producer shared in the risk of producing the crop
on a farm, the historic peanut producers shall receive
their proportional share of the number of acres planted
(or prevented from being planted) to peanuts for harvest
on the farm based on the sharing arrangement that was in
effect among the producers for the crop.
(3) Time for determinations.--The Secretary shall make the
determinations required by this subsection as soon as
practicable after the date of enactment of this Act.
(4) Special considerations.--In making the determinations
required by this subsection, the Secretary shall take into
account changes in the number, identity, or interest of
producers sharing in the risk of producing a peanut crop since
the 1998 crop year, including providing a method for the
assignment of average acres and average yield to a farm--
(A) when an historic peanut producer is no longer
living;
(B) when an entity composed of historic peanut
producers has been dissolved; or
(C) in other appropriate situations, as determined
by the Secretary.
(b) Assignment of Average Yields and Average Acreage to Farms.--
(1) Assignment by historic peanut producers.--The Secretary
shall give each historic peanut producer an opportunity to
assign the average peanut yield and average acreage determined
under subsection (a) for each farm of the historic peanut
producer to cropland on that farm or another farm in the same
State or a contiguous State.
(2) Limitation on acreage assignment.--Notwithstanding
paragraph (1), the average acreage determined under subsection
(a)(2) for a farm may not be assigned to a farm in a contiguous
State unless--
(A) the historic peanut producer making the
assignment produced peanuts in that State during at
least 1 of the 1998 through 2001 crop years; or
(B) as of March 31, 2003, the historic peanut
producer is a producer on a farm in that State.
(3) Notice of assignment opportunity.--The Secretary shall
provide notice to historic peanut producers regarding their
opportunity to assign average peanut yields and average acreages
to farms under paragraph (1). The notice shall include the
following:
(A) Notice that the opportunity to make the
assignments is being provided only once.
(B) A description of the limitation in paragraph (2)
on their ability to make the assignments.
(C) Information regarding the manner in which the
assignments must be made and the time periods and manner
in which notice of the assignments must be submitted to
the Secretary.
(4) Assignment deadlines.--Not later than March 31, 2003, an
historic peanut producer shall submit to the Secretary notice of
the assignments made by the producer under this subsection. If
an historic peanut producer fails to submit the
[[Page 116 STAT. 169]]
notice by that date, the notice shall be submitted in such other
manner as the Secretary may prescribe.
(c) Payment Yield.--The average of all of the yields assigned by
historic peanut producers under subsection (b) to a farm shall be
considered to be the payment yield for that farm for the purpose of
making direct payments and counter-cyclical payments under this
subtitle.
(d) Base Acres for Peanuts.--Subject to subsection (e), the total
number of acres assigned by historic peanut producers under subsection
(b) to a farm shall be considered to be the farm's base acres for
peanuts for the purpose of making direct payments and counter-cyclical
payments under this subtitle.
(e) Treatment of Conservation Reserve Contract Acreage.--
(1) In general.--The Secretary shall provide for an
adjustment, as appropriate, in the base acres for peanuts for a
farm whenever either of the following circumstances occur:
(A) A conservation reserve contract entered into
under section 1231 of the Food Security Act of 1985 (16
U.S.C. 3831) with respect to the farm expires or is
voluntarily terminated.
(B) Cropland is released from coverage under a
conservation reserve contract by the Secretary.
(2) Special payment rules.--For the crop year in which a
base acres for peanuts adjustment under paragraph (1) is first
made, the owner of the farm shall elect to receive either direct
payments and counter-cyclical payments with respect to the
acreage added to the farm under this subsection or a prorated
payment under the conservation reserve contract, but not both.
(f) Prevention of Excess Base Acres for Peanuts.--
(1) Required reduction.--If the sum of the base acres for
peanuts for a farm, together with the acreage described in
paragraph (2), exceeds the actual cropland acreage of the farm,
the Secretary shall reduce the base acres for peanuts for the
farm or the base acres for 1 or more covered commodities under
subtitle A for the farm so that the sum of the base acres for
peanuts and acreage described in paragraph (2) does not exceed
the actual cropland acreage of the farm.
(2) Other acreage.--For purposes of paragraph (1), the
Secretary shall include the following:
(A) Any base acres for the farm under subtitle A.
(B) Any acreage on the farm enrolled in the
conservation reserve program or wetlands reserve program
under chapter 1 of subtitle D of title XII of the Food
Security Act of 1985 (16 U.S.C. 3830 et seq.).
(C) Any other acreage on the farm enrolled in a
conservation program for which payments are made in
exchange for not producing an agricultural commodity on
the acreage.
(3) Selection of acres.--The Secretary shall give the owner
of the farm the opportunity to select the base acres for peanuts
or the subtitle A base acres against which the reduction
required by paragraph (1) will be made.
(4) Exception for double-cropped acreage.--In applying
paragraph (1), the Secretary shall make an exception in the case
of double cropping, as determined by the Secretary.
[[Page 116 STAT. 170]]
(5) Coordinated application of requirements.--The Secretary
shall take into account section 1101(g) when applying the
requirements of this subsection.
(g) Permanent Reduction in Base Acres for Peanuts.--The owner of a
farm may reduce, at any time, the base acres for peanuts assigned to the
farm. The reduction shall be permanent and made in the manner prescribed
by the Secretary.
SEC. 1303. <<NOTE: 7 USC 7953.>> AVAILABILITY OF DIRECT PAYMENTS FOR
PEANUTS.
(a) Payment Required.--
(1) 2002 crop year.--For the 2002 crop year, the Secretary
shall make direct payments under this section to historic peanut
producers.
(2) Subsequent crop years.--For each of the 2003 through
2007 crop years for peanuts, the Secretary shall make direct
payments to the producers on a farm to which a payment yield and
base acres for peanuts are assigned under section 1302.
(b) Payment Rate.--The payment rate used to make direct payments
with respect to peanuts for a crop year shall be equal to $36 per ton.
(c) Payment Amount for 2002 Crop Year.--The amount of the direct
payment to be paid to an historic peanut producer for the 2002 crop of
peanuts shall be equal to the product of the following:
(1) The payment rate specified in subsection (b).
(2) The payment acres of the historic peanut producer.
(3) The average peanut yield determined under section
1302(a)(1) for the historic peanut producer.
(d) Payment Amount for Subsequent Crop Years.--The amount of the
direct payment to be paid to the producers on a farm for the 2003
through 2007 crops of peanuts shall be equal to the product of the
following:
(1) The payment rate specified in subsection (b).
(2) The payment acres on the farm.
(3) The payment yield for the farm.
(e) Time for Payment.--
(1) In general.--The Secretary shall make direct payments--
(A) in the case of the 2002 crop year, as soon as
practicable after the date of enactment of this Act; and
(B) <<NOTE: Deadline.>> in the case of each of the
2003 through 2007 crop years, not later than September
30 of the calendar year in which the crop is harvested.
(2) Advance payments.--At the option of the producers on a
farm, up to 50 percent of the direct payment for any of the 2003
through 2007 crop years shall be paid to the producers in
advance. The producers shall select the month within which the
advance payment for a crop year will be made. The month selected
may be any month during the period beginning on December 1 of
the calendar year before the calendar year in which the crop is
harvested through the month within which the direct payment
would otherwise be made. The producers may change the selected
month for a subsequent advance payment by providing advance
notice to the Secretary.
(3) Repayment of advance payments.--If a producer on a farm
that receives an advance direct payment for a crop
[[Page 116 STAT. 171]]
year ceases to be a producer on that farm, or the extent to
which the producer shares in the risk of producing a crop
changes, before the date the remainder of the direct payment is
made, the producer shall be responsible for repaying the
Secretary the applicable amount of the advance payment, as
determined by the Secretary.
SEC. 1304. <<NOTE: 7 USC 7954.>> AVAILABILITY OF COUNTER-CYCLICAL
PAYMENTS FOR PEANUTS.
(a) Payment Required.--
(1) In general.--During the 2002 through 2007 crop years for
peanuts, the Secretary shall make counter-cyclical payments
under this section with respect to peanuts if the Secretary
determines that the effective price for peanuts is less than the
target price for peanuts.
(2) 2002 crop year.--If counter-cyclical payments are
required for the 2002 crop year, the Secretary shall make the
payments to historic peanut producers.
(3) Subsequent crop years.--If counter-cyclical payments are
required for any of the 2003 through 2007 crop years for
peanuts, the Secretary shall make the payments to the producers
on a farm to which a payment yield and base acres for peanuts
are assigned under section 1302.
(b) Effective Price.--For purposes of subsection (a), the effective
price for peanuts is equal to the sum of the following:
(1) The higher of the following:
(A) The national average market price for peanuts
received by producers during the 12-month marketing year
for peanuts, as determined by the Secretary.
(B) The national average loan rate for a marketing
assistance loan for peanuts in effect for the applicable
period under this subtitle.
(2) The payment rate in effect under section 1303 for the
purpose of making direct payments.
(c) Target Price.--For purposes of subsection (a), the target price
for peanuts shall be equal to $495 per ton.
(d) Payment Rate.--The payment rate used to make counter-cyclical
payments for a crop year shall be equal to the difference between--
(1) the target price; and
(2) the effective price determined under subsection (b).
(e) Payment Amount for 2002 Crop Year.--If counter-cyclical payments
are required to be paid for the 2002 crop of peanuts, the amount of the
counter-cyclical payment to be paid to an historic peanut producer for
that crop year shall be equal to the product of the following:
(1) The payment rate specified in subsection (d).
(2) The payment acres of the historic peanut producer.
(3) The average peanut yield determined under section
1302(a)(1) for the historic peanut producer.
(f) Payment Amount for Subsequent Crop Years.--If counter-cyclical
payments are required to be paid for any of the 2003 through 2007 crops
of peanuts, the amount of the counter-cyclical payment to be paid to the
producers on a farm for that crop year shall be equal to the product of
the following:
(1) The payment rate specified in subsection (d).
(2) The payment acres on the farm.
[[Page 116 STAT. 172]]
(3) The payment yield for the farm.
(g) Time for Payments.--
(1) General rule.--If the Secretary determines under
subsection (a) that counter-cyclical payments are required to be
made under this section for a crop year, the Secretary shall
make the counter-cyclical payments as soon as practicable after
the end of the 12-month marketing year for the crop.
(2) Availability of partial payments.--If, before the end of
the 12-month marketing year, the Secretary estimates that
counter-cyclical payments will be required under this section
for a crop year, the Secretary shall give producers on a farm
(or, in the case of the 2002 crop year, historic peanut
producers) the option to receive partial payments of the
counter-cyclical payment projected to be made for that crop.
(3) Time for partial payments.--
(A) 2002 through 2006 crop years.--When the
Secretary makes partial payments available under
paragraph (2) for any of the 2002 through 2006 crop
years--
(i) the first partial payment for the crop
year shall be made not earlier than October 1,
and, to the maximum extent practicable, not later
than October 31, of the calendar year in which the
crop is harvested;
(ii) the second partial payment shall be made
not earlier than February 1 of the next calendar
year; and
(iii) the final partial payment shall be made
as soon as practicable after the end of the 12-
month marketing year for that crop.
(B) 2007 crop year.--When the Secretary makes
partial payments available for the 2007 crop year--
(i) the first partial payment shall be made
after completion of the first 6 months of the
marketing year for that crop; and
(ii) the final partial payment shall be made
as soon as practicable after the end of the 12-
month marketing year for that crop.
(4) Amount of partial payments.--
(A) 2002 crop year.--
(i) First partial payment.--In the case of the
2002 crop year, the first partial payment under
paragraph (3) to an historic peanut producer may
not exceed 35 percent of the projected counter-
cyclical payment for the crop year, as determined
by the Secretary.
(ii) Second partial payment.--The second
partial payment may not exceed the difference
between--
(I) 70 percent of the projected
counter-cyclical payment (including any
revision thereof) for the 2002 crop
year; and
(II) the amount of the payment made
under clause (i).
(iii) Final payment.--The final payment shall
be equal to the difference between--
(I) the actual counter-cyclical
payment to be made to the historic
peanut producer; and
(II) the amount of the partial
payments made to the historic peanut
producer under clauses (i) and (ii).
[[Page 116 STAT. 173]]
(B) 2003 through 2006 crop years.--
(i) First partial payment.--For each of the
2003 through 2006 crop years, the first partial
payment under paragraph (3) to the producers on a
farm may not exceed 35 percent of the projected
counter-cyclical payment for the crop year, as
determined by the Secretary.
(ii) Second partial payment.--The second
partial payment for a crop year may not exceed the
difference between--
(I) 70 percent of the projected
counter-cyclical payment (including any
revision thereof) for the crop year; and
(II) the amount of the payment made
under clause (i).
(iii) Final payment.--The final payment for a
crop year shall be equal to the difference
between--
(I) the actual counter-cyclical
payment to be made to the producers for
that crop year; and
(II) the amount of the partial
payments made to the producers under
clauses (i) and (ii) for that crop year.
(C) 2007 crop year.--
(i) First partial payment.--For the 2007 crop
year, the first partial payment under paragraph
(3) to the producers on a farm may not exceed 40
percent of the projected counter-cyclical payment
for the crop year, as determined by the Secretary.
(ii) Final payment.--The final payment for the
2007 crop year shall be equal to the difference
between--
(I) the actual counter-cyclical
payment to be made to the producers for
that crop year; and
(II) the amount of the partial
payment made to the producers under
clause (i).
(5) Repayment.--The producers on a farm (or, in the case of
the 2002 crop year, historic peanut producers) that receive a
partial payment under this subsection for a crop year shall
repay to the Secretary the amount, if any, by which the total of
the partial payments exceed the actual counter-cyclical payment
to be made for that crop year.
SEC. 1305. <<NOTE: 7 USC 7955.>> PRODUCER AGREEMENT REQUIRED AS
CONDITION ON PROVISION OF DIRECT PAYMENTS AND COUNTER-
CYCLICAL PAYMENTS.
(a) Compliance With Certain Requirements.--
(1) Requirements.--Before the producers on a farm may
receive direct payments or counter-cyclical payments under this
subtitle with respect to the farm, the producers shall agree,
during the crop year for which the payments are made and in
exchange for the payments--
(A) to comply with applicable conservation
requirements under subtitle B of title XII of the Food
Security Act of 1985 (16 U.S.C. 3811 et seq.);
(B) to comply with applicable wetland protection
requirements under subtitle C of title XII of that Act
(16 U.S.C. 3821 et seq.);
[[Page 116 STAT. 174]]
(C) to comply with the planting flexibility
requirements of section 1306;
(D) to use the land on the farm, in a quantity equal
to the attributable base acres for peanuts and any base
acres for the farm under subtitle A, for an agricultural
or conserving use, and not for a nonagricultural
commercial or industrial use, as determined by the
Secretary; and
(E) to effectively control noxious weeds and
otherwise maintain the land in accordance with sound
agricultural practices, as determined by the Secretary,
if the agricultural or conserving use involves the
noncultivation of any portion of the land referred to in
subparagraph (D).
(2) Compliance.--The Secretary may issue such rules as the
Secretary considers necessary to ensure producer compliance with
the requirements of paragraph (1).
(3) Modification.--At the request of the transferee or
owner, the Secretary may modify the requirements of this
subsection if the modifications are consistent with the
objectives of this subsection, as determined by the Secretary.
(b) Transfer or Change of Interest in Farm.--
(1) Termination.--Except as provided in paragraph (2), a
transfer of (or change in) the interest of the producers on a
farm in the base acres for peanuts for which direct payments or
counter-cyclical payments are made shall result in the
termination of the payments with respect to those acres, unless
the transferee or owner of the acreage agrees to assume all
obligations under subsection (a). The termination shall take
effect on the date determined by the Secretary.
(2) Exception.--If a producer entitled to a direct payment
or counter-cyclical payment dies, becomes incompetent, or is
otherwise unable to receive the payment, the Secretary shall
make the payment, in accordance with rules issued by the
Secretary.
(c) Acreage Reports.--As a condition on the receipt of direct
payments, counter-cyclical payments, marketing assistance loans, or loan
deficiency payments under this subtitle, the Secretary shall require the
producers on a farm to which a payment yield and base acres for peanuts
are assigned under section 1302 to submit to the Secretary annual
acreage reports with respect to all cropland on the farm.
(d) Tenants and Sharecroppers.--In carrying out this subtitle, the
Secretary shall provide adequate safeguards to protect the interests of
tenants and sharecroppers.
(e) Sharing of Payments.--The Secretary shall provide for the
sharing of direct payments and counter-cyclical payments among the
producers on a farm on a fair and equitable basis.
SEC. 1306. <<NOTE: 7 USC 7956.>> PLANTING FLEXIBILITY.
(a) Permitted Crops.--Subject to subsection (b), any commodity or
crop may be planted on the base acres for peanuts on a farm.
(b) Limitations Regarding Certain Commodities.--
(1) General limitation.--The planting of an agricultural
commodity specified in paragraph (2) shall be prohibited on base
acres for peanuts unless the commodity, if planted, is destroyed
before harvest.
[[Page 116 STAT. 175]]
(2) Treatment of trees and other perennials.--The planting
of an agricultural commodity specified in paragraph (3) that is
produced on a tree or other perennial plant shall be prohibited
on base acres for peanuts.
(3) Covered agricultural commodities.--Paragraphs (1) and
(2) apply to the following agricultural commodities:
(A) Fruits.
(B) Vegetables (other than lentils, mung beans, and
dry peas).
(C) Wild rice.
(c) Exceptions.--Paragraphs (1) and (2) of subsection (b) shall not
limit the planting of an agricultural commodity specified in paragraph
(3) of that subsection--
(1) in any region in which there is a history of double-
cropping of peanuts with agricultural commodities specified in
subsection (b)(3), as determined by the Secretary, in which case
the double-cropping shall be permitted;
(2) on a farm that the Secretary determines has a history of
planting agricultural commodities specified in subsection (b)(3)
on the base acres for peanuts, except that direct payments and
counter-cyclical payments shall be reduced by an acre for each
acre planted to such an agricultural commodity; or
(3) by the producers on a farm that the Secretary determines
has an established planting history of a specific agricultural
commodity specified in subsection (b)(3), except that--
(A) the quantity planted may not exceed the average
annual planting history of such agricultural commodity
by the producers on the farm in the 1991 through 1995 or
1998 through 2001 crop years (excluding any crop year in
which no plantings were made), as determined by the
Secretary; and
(B) direct payments and counter-cyclical payments
shall be reduced by an acre for each acre planted to
such agricultural commodity.
SEC. 1307. <<NOTE: 7 USC 7957.>> MARKETING ASSISTANCE LOANS AND LOAN
DEFICIENCY PAYMENTS FOR PEANUTS.
(a) Nonrecourse Loans Available.--
(1) Availability.--For each of the 2002 through 2007 crops
of peanuts, the Secretary shall make available to producers on a
farm nonrecourse marketing assistance loans for peanuts 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 subsection (b).
(2) Eligible production.--The producers on a farm shall be
eligible for a marketing assistance loan under this subsection
for any quantity of peanuts produced on the farm.
(3) Treatment of certain commingled commodities.--In
carrying out this subsection, the Secretary shall make loans to
producers on a farm that would be eligible to obtain a marketing
assistance loan, but for the fact the peanuts owned by the
producers on the farm are commingled with other peanuts in
facilities unlicensed for the storage of agricultural
commodities by the Secretary or a State licensing authority, if
the producers obtaining the loan agree to immediately redeem the
loan collateral in accordance with section 166 of the Federal
[[Page 116 STAT. 176]]
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7286).
(4) Options for obtaining loan.--A marketing assistance loan
under this subsection, and loan deficiency payments under
subsection (e), may be obtained at the option of the producers
on a farm through--
(A) a designated marketing association or marketing
cooperative of producers that is approved by the
Secretary; or
(B) the Farm Service Agency.
(5) Storage of loan peanuts.--As a condition on the
Secretary's approval of an individual or entity to provide
storage for peanuts for which a marketing assistance loan is
made under this section, the individual or entity shall agree--
(A) to provide such storage on a nondiscriminatory
basis; and
(B) to comply with such additional requirements as
the Secretary considers appropriate to accomplish the
purposes of this section and promote fairness in the
administration of the benefits of this section.
(6) Payment of peanut storage costs.--Effective for the 2002
through 2006 crops of peanuts, to ensure proper storage of
peanuts for which a loan is made under this section, the
Secretary shall use the funds of the Commodity Credit
Corporation to pay storage, handling, and other associated
costs. This authority terminates beginning with the 2007 crop of
peanuts.
(7) Marketing.--A marketing association or cooperative may
market peanuts for which a loan is made under this section in
any manner that conforms to consumer needs, including the
separation of peanuts by type and quality.
(b) Loan Rate.--The loan rate for a marketing assistance loan under
for peanuts subsection (a) shall be equal to $355 per ton.
(c) Term of Loan.--
(1) In general.--A marketing assistance loan for peanuts
under subsection (a) shall have a term of 9 months beginning on
the first day of the first month after the month in which the
loan is made.
(2) Extensions prohibited.--The Secretary may not extend the
term of a marketing assistance loan for peanuts under subsection
(a).
(d) Repayment Rate.--
(1) In general.--The Secretary shall permit producers on a
farm to repay a marketing assistance loan for peanuts under
subsection (a) at a rate that is the lesser of--
(A) the loan rate established for peanuts under
subsection (b), plus interest (determined in accordance
with section 163 of the Federal Agriculture Improvement
and Reform Act of 1996 (7 U.S.C. 7283)); or
(B) a rate that the Secretary determines will--
(i) minimize potential loan forfeitures;
(ii) minimize the accumulation of stocks of
peanuts by the Federal Government;
(iii) minimize the cost incurred by the
Federal Government in storing peanuts; and
(iv) allow peanuts produced in the United
States to be marketed freely and competitively,
both domestically and internationally.
[[Page 116 STAT. 177]]
(2) Good faith exception to beneficial interest
requirement.--For the 2002 crop year only, in the case of the
producers on a farm that marketed or otherwise lost beneficial
interest in the peanuts for which a marketing assistance loan
was made under this section before repaying the loan, the
Secretary shall permit the producers to repay the loan at the
applicable repayment rate that was in effect for peanuts under
this subsection on the date that the producers lost beneficial
interest, as determined by the Secretary, if the Secretary
determines the producers acted in good faith.
(e) Loan Deficiency Payments.--
(1) Availability.--The Secretary may make loan deficiency
payments available to producers on a farm that, although
eligible to obtain a marketing assistance loan for peanuts under
subsection (a), agree to forgo obtaining the loan for the
peanuts in return for loan deficiency payments under this
subsection.
(2) Computation.--A loan deficiency payment under this
subsection shall be computed by multiplying--
(A) the payment rate determined under paragraph (3)
for peanuts; by
(B) the quantity of the peanuts produced by the
producers, excluding any quantity for which the
producers obtain a marketing assistance loan under
subsection (a).
(3) Payment rate.--For purposes of this subsection, the
payment rate shall be the amount by which--
(A) the loan rate established under subsection (b);
exceeds
(B) the rate at which a loan may be repaid under
subsection (d).
(4) Effective date for payment rate determination.--
(A) In general.--The Secretary shall determine the
amount of the loan deficiency payment to be made under
this subsection to the producers on a farm with respect
to a quantity of peanuts using the payment rate in
effect under paragraph (3) as of the date the producers
request the payment.
(B) Special rule for 2002 crop year.--For the 2002
crop year only, the Secretary shall determine the amount
of the loan deficiency payment to be made under this
subsection to the producers on a farm with respect to a
quantity of peanuts using the payment rate in effect
under paragraph (3) as of the earlier of the following:
(i) The date on which the producers marketed
or otherwise lost beneficial interest in the crop,
as determined by the Secretary.
(ii) The date the producers request the
payment.
(f) Compliance With Conservation and Wetlands Requirements.--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 that Act (16 U.S.C. 3821 et seq.)
during the term of the loan.
(g) Reimbursable Agreements and Payment of Administrative
Expenses.--The Secretary may implement any reimbursable agreements or
provide for the payment of administrative expenses
[[Page 116 STAT. 178]]
under this subtitle only in a manner that is consistent with such
activities in regard to other commodities.
SEC. 1308. <<NOTE: 7 USC 7958.>> MISCELLANEOUS PROVISIONS.
(a) Mandatory Inspection.--All peanuts marketed in the United States
shall be officially inspected and graded by Federal or Federal-State
inspectors.
(b) Termination of Peanut Administrative Committee.--The Peanut
Administrative Committee established under Marketing Agreement No. 146
issued pursuant to the Agricultural Adjustment Act (7 U.S.C. 601 et
seq.), reenacted with amendments by the Agricultural Marketing Agreement
Act of 1937, is terminated.
(c) Peanut Standards Board.--
(1) Establishment and purpose.--The Secretary shall
establish a Peanut Standards Board for the purpose of advising
the Secretary regarding the establishment of quality and
handling standards for domestically produced and imported
peanuts.
(2) Membership and appointment.--
(A) Total members.--The Board shall consist of 18
members, with representation equally divided between
peanut producers and peanut industry representatives.
(B) Appointment process for producers.--The
Secretary shall appoint--
(i) 3 producers from the Southeast (Alabama,
Georgia, and Florida) peanut producing region;
(ii) 3 producers from the Southwest (Texas,
Oklahoma, and New Mexico) peanut producing region;
and
(iii) 3 producers from the Virginia/Carolina
(Virginia and North Carolina) peanut producing
region.
(C) Appointment process for industry
representatives.--The Secretary shall appoint 3 peanut
industry representatives from each of the 3 peanut
producing regions in the United States.
(3) Terms.--
(A) In general.--A member of the Board shall serve a
3-year term.
(B) Initial appointment.--In making the initial
appointments to the Board, the Secretary shall stagger
the terms of the members so that--
(i) 1 producer member and peanut industry
member from each peanut producing region serves a
1-year term;
(ii) 1 producer member and peanut industry
member from each peanut producing region serves a
2-year term; and
(iii) 1 producer member and peanut industry
member from each peanut producing region serves a
3-year term.
(4) Consultation required.--The Secretary shall consult with
the Board in advance whenever the Secretary establishes or
changes, or considers the establishment of or a change to,
quality and handling standards for peanuts.
(5) Federal advisory committee act.--The Federal Advisory
Committee Act (5 U.S.C. App.) shall not apply to the Board.
[[Page 116 STAT. 179]]
(d) Priority.--The Secretary shall make identifying and combating
the presence of all quality concerns related to peanuts a priority in
the development of quality and handling standards for peanuts and in the
inspection of domestically produced and imported peanuts. The Secretary
shall consult with appropriate Federal and State agencies to provide
adequate safeguards against all quality concerns related to peanuts.
(e) Consistent Standards.--Imported peanuts shall be subject to the
same quality and handling standards as apply to domestically produced
peanuts.
(f) Authorization of Appropriations.--
(1) In general.--In addition to other funds that are
available to carry out this section, there is authorized to be
appropriated such sums as are necessary to carry out this
section.
(2) Treatment of board expenses.--The expenses of the Peanut
Standards Board shall not be counted toward any general
limitation on the expenses of advisory committees, panels,
commissions, and task forces of the Department of Agriculture,
whether enacted before, on, or after the date of enactment of
this Act, unless the limitation specifically refers to this
paragraph and specifically includes the Peanut Standards Board
within the general limitation.
(g) Transition Rule.--
(1) Temporary designation of peanut administrative committee
members.--Notwithstanding the appointment process specified in
subsection (c) for the Peanut Standards Board, during the
transition period, the Secretary may designate persons serving
as members of the Peanut Administrative Committee on the day
before the date of enactment of this Act to serve as members of
the Peanut Standards Board for the purpose of carrying out the
duties of the Board described in this section.
(2) Funds.--The Secretary may transfer any funds available
to carry out the activities of the Peanut Administrative
Committee to the Peanut Standards Board to carry out the duties
of the Board described in this section.
(3) Transition period.--In paragraph (1), the term
``transition period'' means the period beginning on the date of
enactment of this Act and ending on the earlier of--
(A) the date the Secretary appoints the members of
the Peanut Standards Board pursuant to subsection (c);
or
(B) 180 days after the date of enactment of this
Act.
(h) Effective Date.--This section shall take effect with the 2002
crop of peanuts.
SEC. 1309. <<NOTE: 7 USC 7959.>> TERMINATION OF MARKETING QUOTA
PROGRAMS FOR PEANUTS AND COMPENSATION TO PEANUT QUOTA
HOLDERS FOR LOSS OF QUOTA ASSET VALUE.
(a) Repeal of Marketing Quota.--
(1) Repeal.--Part VI of subtitle B of title III of the
Agricultural Adjustment Act of 1938 (7 U.S.C. 1357-1359a),
relating to peanuts, is repealed.
(2) Treatment of 2001 crop.--Part VI of subtitle B of title
III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1357-
1359a), as in effect on the day before the date of enactment of
this Act, shall continue to apply with respect to the
[[Page 116 STAT. 180]]
2001 crop of peanuts notwithstanding the amendment made by
paragraph (1). Section 1308(g)(2) shall also apply to the 2001
crop of peanuts.
(b) Compensation Contract Required.--
(1) In general.--The Secretary shall offer to enter into a
contract with each person that the Secretary determines is an
eligible peanut quota holder under subsection (f) for the
purpose of providing compensation for the lost value of the
quota on account of the repeal of the marketing quota program
for peanuts under subsection (a).
(2) Payment period.--The Secretary shall make payments under
the contracts during fiscal years 2002 through 2006.
(c) Time for Payment.--
(1) Payment in installments.--The payments required under
the contracts shall be provided in 5 equal installments not
later than September 30 of each of fiscal years 2002 through
2006.
(2) Single payment.--At the request of an eligible peanut
quota holder entitled to payments under a contract, the
Secretary shall provide the entire payment amount determined
under subsection (d) with respect to the eligible peanut quota
holder for the 5 fiscal years in a single lump sum during the
fiscal year specified by the eligible peanut quota holder.
(d) Payment Amount.--The amount of the payment for a fiscal year to
an eligible peanut quota holder under a contract shall be equal to the
product obtained by multiplying--
(1) $0.11 per pound; by
(2) the number of pounds of quota with respect to which the
person qualifies as a peanut quota holder under subsection (f).
(e) Assignment of 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 the payments made
under the contracts. A person making an assignment of the payment, or
the assignee, shall provide the Secretary with notice, in such manner as
the Secretary may require, of any assignment made under this subsection.
(f) Eligible Peanut Quota Holder.--
(1) In general.--Except as otherwise provided in this
subsection, the Secretary shall consider a person to be an
eligible peanut quota holder for the purposes of this section if
the person, as of the date of enactment of this Act, owned a
farm that, also as of that date, was eligible for a permanent
peanut quota under section 358-1(b) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1358-1(b)), irrespective of
temporary leases, transfers of quotas for seed, or quotas for
experimental purposes.
(2) Effect of purchase contract.--If there was a written
contract for the purchase of all or a portion of a farm
described in paragraph (1) as of the date of enactment of this
Act and the parties to the sale are unable to agree to the
disposition of eligibility for payments under this section, the
Secretary, taking into account any incomplete permanent transfer
of quota that has otherwise been agreed to, shall provide for
the equitable division of the payments among the parties by
adjusting the determination of who is the eligible peanut quota
holder with respect to particular pounds of the quota.
[[Page 116 STAT. 181]]
(3) Effect of agreement for permanent quota transfer.--If
the Secretary determines that there was in existence, as of the
date of enactment of this Act, an agreement for the permanent
transfer of quota, but that the transfer was not completed by
that date, the Secretary shall consider the peanut quota holder
to be the party to the agreement who, as of that date, was the
owner of the farm to which the quota was to be transferred.
(4) Protected bases.--A person that owns a farm with a
peanut poundage quota which is protected under a conservation
reserve program contract entered into under section 1231 of the
Food Security Act of 1985 (16 U.S.C. 3831) shall be considered
to be an eligible quota holder with respect to the protected
poundage.
(5) Secretarial discretion.--Notwithstanding the preceding
paragraphs, the Secretary may declare a person to be the
eligible peanut quota holder with respect to certain pounds of
quota or otherwise for purposes of this section if the Secretary
considers the declaration is needed to insure a fair and
equitable administration of the payments provided for in this
section, so long as the Secretary does not, in exercising this
authority, effectively increase the total quota in excess of the
quota that was available to all producers for the 2001 crop year
for other than seed or experimental use.
(6) Limitation on quantity of quota held.--A person shall be
considered an eligible peanut quota holder for purposes of this
section only with respect to that number of permanent pounds
that qualifies the person as a peanut quota holder under one of
the preceding paragraphs. The determination of the peanut
poundage amount for which the person qualifies shall be made
based on the 2001 crop quota levels and shall take into account
sales of the farm that occurred before the date of enactment of
this Act and any permanent transfers of quota that took place
before that date, consistent with the preceding paragraphs. The
Secretary shall not take into account, or allow eligibility for,
quotas for seed, granted as experimental quotas, or obtained by
temporary lease or transfer.
(g) Successions in Payment Eligibility and Attachment of Eligibility
to Persons.--
(1) Eligibility attaches to persons.--Once a person is
eligible for payments under this section, as determined under
subsection (f), the continued eligibility of the person for the
payments does not run with a farm, but shall remain with the
person for the term of this section irrespective of whether the
person sells, or continues to have an interest in, the farm that
had the quota that qualified the person as an eligible peanut
quota holder under subsection (f) and irrespective of whether
the person has a continuing interest in the production of
peanuts.
(2) Succession.--If a person eligible for payments under
this section dies, in the case of an individual, or ceases to
exist, in the case of other persons, the payment eligibility of
the person shall pass to the person's personal or organizational
successor, as determined by the Secretary.
(h) Conforming Amendments.--
[[Page 116 STAT. 182]]
(1) Administrative provisions.--Section 361 of the
Agricultural Adjustment Act of 1938 (7 U.S.C. 1361) is amended
by striking ``peanuts,''.
(2) Adjustment of quotas.--Section 371 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1371) is amended--
(A) in the first sentence of subsection (a), by
striking ``peanuts,''; and
(B) in the first sentence of subsection (b), by
striking ``peanuts''.
(3) Reports and records.--Section 373 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1373) is amended--
(A) in the first sentence of subsection (a)--
(i) by striking ``peanuts,'' each place it
appears;
(ii) by inserting ``and'' after ``from
producers,''; and
(iii) by striking ``for producers, all'' and
all that follows through the period at the end of
the sentence and inserting ``for producers.''; and
(B) in subsection (b), by striking ``peanuts,''.
(4) Eminent domain.--Section 378(c) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1378(c)) is amended in the
first sentence--
(A) by striking ``cotton,'' and inserting ``cotton
and''; and
(B) by striking ``and peanuts,''.
SEC. 1310. <<NOTE: 7 USC 7960.>> REPEAL OF SUPERSEDED PRICE SUPPORT
AUTHORITY AND EFFECT OF REPEAL.
(a) Repeal of Price Support Authority.--
(1) In general.--Section 155 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7271) is repealed.
(2) Conforming amendments.--The Agricultural Act of 1949 (7
U.S.C. 1441 et seq.) is amended--
(A) in section 101(b) (7 U.S.C. 1441(b)), by
striking ``and peanuts''; and
(B) in section 408(c) (7 U.S.C. 1428(c)), by
striking ``peanuts,''.
(3) Technical amendment.--The chapter heading of chapter 2
of subtitle D of the Federal Agriculture Improvement and Reform
Act of 1996 (7 U.S.C. prec. 7271) is amended by striking
``PEANUTS AND''.
(b) Disposal.--Notwithstanding any other provision of law or
previous declaration made by the Secretary, the Secretary shall ensure
that the disposal of all peanuts for which a loan for the 2001 crop of
peanuts was made under section 155 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7271) before the date of
enactment of this Act is carried out in a manner that prevents price
disruptions in the domestic and international markets for peanuts.
(c) Treatment of Crop Insurance Policies for 2002 Crop Year.--
(1) Applicability.--This subsection shall apply for the 2002
crop year only notwithstanding any other provision of law or
crop insurance policy.
(2) Price election.--The nonquota price election for
segregation I, II, and III peanuts shall be 17.75 cents per
pound
[[Page 116 STAT. 183]]
and shall be used for all aspects of the policy relating to the
calculations of premium, liability, and indemnities.
(3) Quality Adjustment.--For the purposes of quality
adjustment only, the average support price per pound of peanuts
shall be a price equal to 17.75 cents per pound. Quality under
the crop insurance policy for peanuts shall be adjusted under
procedures issued by the Federal Crop Insurance Corporation.
Subtitle D--Sugar
SEC. 1401. SUGAR PROGRAM.
(a) Extension and Modification of Existing Sugar Program.--Section
156 of the Federal Agriculture Improvement and Reform Act of 1996 (7
U.S.C. 7272) is amended to read as follows:
``SEC. 156. SUGAR PROGRAM.
``(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) Loan Rate Adjustments.--
``(1) In general.--The Secretary may 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 growing, 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
subsection as far in advance as is practicable.
``(4) Definitions.--In this subsection:
``(A) Agreement on agriculture.--The term
``Agreement 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)), or
any amendatory or successor agreement.
``(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
subparagraph (A) that the Secretary determines
produce the greatest quantity of sugar.
``(d) Term of Loans.--
[[Page 116 STAT. 184]]
``(1) In general.--A loan under this section during any
fiscal year shall be made available not earlier than the
beginning 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.--
``(1) Nonrecourse loans.--The Secretary shall carry out this
section through the use of nonrecourse loans.
``(2) Processor assurances.--
``(A) In general.--The Secretary shall obtain from
each processor that receives a loan under this section
such assurances as the Secretary 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 the sugar beets and
sugarcane delivered by producers to the processor.
``(B) Minimum payments.--
``(i) In general.--Subject to clause (ii), the
Secretary may establish appropriate minimum
payments for purposes of this paragraph.
``(ii) Limitation.--In the case of sugar
beets, the minimum payment established under
clause (i) shall not exceed the rate of payment
provided for under the applicable contract between
a sugar beet producer and a sugar beet processor.
``(iii) Effect of disaster.--The Secretary may
not bar a beet sugar processor from eligibility to
obtain a loan under this section because of the
failure of the processor to provide the
appropriate minimum payment established under this
subsection if the failure--
``(I) occurred during a crop year
prior to the date of enactment of the
Farm Security and Rural Investment Act
of 2002; and
``(II) was related, at least in
part, to the effects of a natural
disaster, including damage from freeze.
``(3) Administration.--The Secretary may not impose or
enforce any prenotification requirement, or similar
administrative requirement not otherwise in effect on the date
of enactment of the Farm Security and Rural Investment Act of
2002, that has the effect of preventing a processor from
electing to forfeit the loan collateral (of an acceptable grade
and quality) on the maturity of the loan.
``(f) Loans for In-Process Sugar.--
[[Page 116 STAT. 185]]
``(1) Definition of in-process sugars and syrups.--In this
subsection, the term `in-process sugars and syrups' does not
include raw sugar, liquid sugar, invert sugar, invert syrup, or
other finished product that is otherwise eligible for a loan
under subsection (a) or (b).
``(2) Availability.--The Secretary shall make nonrecourse
loans available to processors of a crop of domestically grown
sugarcane and sugar beets for in-process sugars and syrups
derived from the crop.
``(3) Loan rate.--The loan rate shall be equal to 80 percent
of the loan rate applicable to raw cane sugar or refined beet
sugar, as determined by the Secretary on the basis of the source
material for the in-process sugars and syrups.
``(4) Further processing on forfeiture.--
``(A) In general.--As a condition of the forfeiture
of in-process sugars and syrups serving as collateral
for a loan under paragraph (2), the processor shall,
within such reasonable time period as the Secretary may
prescribe and at no cost to the Commodity Credit
Corporation, convert the in-process sugars and syrups
into raw cane sugar or refined beet sugar of acceptable
grade and quality for sugars eligible for loans under
subsection (a) or (b).
``(B) Transfer to corporation.--Once the in-process
sugars and syrups are fully processed into raw cane
sugar or refined beet sugar, the processor shall
transfer the sugar to the Commodity Credit Corporation.
``(C) Payment to processor.--On transfer of the
sugar, the Secretary shall make a payment to the
processor in an amount equal to the amount obtained by
multiplying--
``(i) the difference between--
``(I) the loan rate for raw cane
sugar or refined beet sugar, as
appropriate; and
``(II) the loan rate the processor
received under paragraph (3); by
``(ii) the quantity of sugar transferred to
the Secretary.
``(5) Loan conversion.--If the processor does not forfeit
the collateral as described in paragraph (4), but instead
further processes the in-process sugars and syrups into raw cane
sugar or refined beet sugar and repays the loan on the in-
process sugars and syrups, the processor may obtain a loan under
subsection (a) or (b) for the raw cane sugar or refined beet
sugar, as appropriate.
``(6) Term of loan.--The term of a loan made under this
subsection for a quantity of in-process sugars and syrups, when
combined with the term of a loan made with respect to the raw
cane sugar or refined beet sugar derived from the in-process
sugars and syrups, may not exceed 9 months, consistent with
subsection (d).
``(g) Avoiding Forfeitures; Corporation Inventory Disposition.--
``(1) In general.--Subject to subsection (e)(3), to the
maximum extent practicable, the Secretary shall operate the
program established under this section at no cost to the Federal
Government by avoiding the forfeiture of sugar to the Commodity
Credit Corporation.
[[Page 116 STAT. 186]]
``(2) Inventory disposition.--
``(A) In general.--To carry out paragraph (1), the
Commodity Credit Corporation may accept bids to obtain
raw cane sugar or refined beet sugar in the inventory of
the Commodity Credit Corporation from (or otherwise make
available such commodities, on appropriate terms and
conditions, to) processors of sugarcane and processors
of sugar beets (acting in conjunction with the producers
of the sugarcane or sugar beets processed by the
processors) in return for the reduction of production of
raw cane sugar or refined beet sugar, as appropriate.
``(B) Additional authority.--The authority provided
under this paragraph is in addition to any authority of
the Commodity Credit Corporation under any other law.
``(h) Information Reporting.--
``(1) Duty of processors and refiners to report.--A
sugarcane processor, cane sugar refiner, and sugar beet
processor 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,
distribution, and stock levels of sugar.
``(2) Duty of producers to report.--
``(A) Proportionate share states.--As a condition of
a loan made to a processor for the benefit of a
producer, the Secretary shall require each producer of
sugarcane located in a State (other than the
Commonwealth of Puerto Rico) in which there are in
excess of 250 producers of sugarcane to report, in the
manner prescribed by the Secretary, the sugarcane yields
and acres planted to sugarcane of the producer.
``(B) Other states.--The Secretary may require each
producer of sugarcane or sugar beets not covered by
subparagraph (A) to report, in a manner prescribed by
the Secretary, the yields of, and acres planted to,
sugarcane or sugar beets, respectively, of the producer.
``(3) Duty of importers to report.--
``(A) In general.--Except as provided in
subparagraph (B), the Secretary shall require an
importer of sugars, syrups, or molasses to be used for
human consumption or to be used for the extraction of
sugar for human consumption to report, in the manner
prescribed by the Secretary, the quantities of the
products imported by the importer and the sugar content
or equivalent of the products.
``(B) Tariff-rate quotas.--Subparagraph (A) shall
not apply to sugars, syrups, or molasses that are within
the quantities of tariff-rate quotas that are subject to
the lower rate of duties.
``(4) Penalty.--Any 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.
``(5) Monthly reports.--Taking into consideration the
information received under this subsection, the Secretary shall
publish on a monthly basis composite data on production,
imports, distribution, and stock levels of sugar.
[[Page 116 STAT. 187]]
``(i) Substitution of Refined Sugar.--For purposes of Additional
U.S. Note 6 to chapter 17 of the Harmonized Tariff Schedule of the
United States and the reexport programs and polyhydric alcohol program
administered by the Secretary, all refined sugars (whether derived from
sugar beets or sugarcane) produced by cane sugar refineries and beet
sugar processors shall be fully substitutable for the export of sugar
and sugar-containing products under those programs.
``(j) Effective Period.--This section shall be effective only for
the 1996 through 2007 crops of sugar beets and sugarcane.''.
(b) Effective <<NOTE: 7 USC 7272 note.>> Date of Assessment
Termination.--Subsection (f) of section 156 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7272(f)), as in effect
immediately before the enactment of the Farm Security and Rural
Investment Act of 2002, is deemed to have been repealed effective as of
October 1, 2001.
(c) Interest Rate.--Section 163 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7283) is amended--
(1) by inserting ``(a) In General.--'' before
``Notwithstanding''; and
(2) by adding at the end the following:
``(b) Sugar.--For purposes of this section, raw cane sugar, refined
beet sugar, and in-process sugar eligible for a loan under section 156
shall not be considered an agricultural commodity.''.
SEC. 1402. <<NOTE: 7 USC 7971.>> STORAGE FACILITY LOANS.
(a) In General.--Notwithstanding any other provision of law and as
soon as practicable after the date of enactment of this Act, the
Commodity Credit Corporation shall amend part 1436 of title 7, Code of
Federal Regulations, to establish a sugar storage facility loan program
to provide financing for processors of domestically-produced sugarcane
and sugar beets to construct or upgrade storage and handling facilities
for raw sugars and refined sugars.
(b) Eligible Processors.--A storage facility loan described in
subsection (a) shall be made available to any processor of domestically
produced sugarcane or sugar beets that (as determined by the
Secretary)--
(1) has a satisfactory credit history;
(2) has a need for increased storage capacity, taking into
account the effects of marketing allotments; and
(3) demonstrates an ability to repay the loan.
(c) Term of Loans.--A storage facility loan described in subsection
(a) shall--
(1) have a minimum term of 7 years; and
(2) be in such amounts and on such terms and conditions
(including terms and conditions relating to downpayments,
collateral, and eligible facilities) as are normal, customary,
and appropriate for the size and commercial nature of the
borrower.
SEC. 1403. FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR.
Part VII of subtitle B of title III of the Agricultural Adjustment
Act of 1938 (7 U.S.C. 359aa et seq.) is amended to read as follows:
[[Page 116 STAT. 188]]
``PART VII--FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR
``SEC. 359a. <<NOTE: 7 USC 1359aa.>> DEFINITIONS.
``In this part:
``(1) Mainland state.--The term `mainland State' means a
State other than an offshore State.
``(2) Offshore state.--The term `offshore State' means a
sugarcane producing State located outside of the continental
United States.
``(3) State.--Notwithstanding section 301, the term `State'
means--
``(A) a State;
``(B) the District of Columbia; and
``(C) the Commonwealth of Puerto Rico.
``(4) United states.--The term `United States', when used in
a geographical sense, means all of the States.
``SEC. 359b. <<NOTE: 7 USC 1359bb.>> FLEXIBLE MARKETING ALLOTMENTS FOR
SUGAR.
``(a) Sugar Estimates.--
``(1) In <<NOTE: Deadline.>> general.--Not later than August
1 before the beginning of each of the 2002 through 2007 crop
years, the Secretary shall estimate--
``(A) the quantity of sugar that will be consumed in
the United States during the crop year;
``(B) the quantity of sugar that would provide for
reasonable carryover stocks;
``(C) the quantity of sugar that will be available
from carry-in stocks for consumption in the United
States during the crop year;
``(D) the quantity of sugar that will be available
from the domestic processing of sugarcane and sugar
beets; and
``(E) the quantity of sugars, syrups, and molasses
that will be imported for human consumption or to be
used for the extraction of sugar for human consumption
in the United States during the crop year, whether such
articles are under a tariff-rate quota or are in excess
or outside of a tariff-rate quota.
``(2) Exclusion.--The estimates under this subsection shall
not apply to sugar imported for the production of polyhydric
alcohol or to any sugar refined and reexported in refined form
or in products containing sugar.
``(3) Reestimates.--The Secretary shall make reestimates of
sugar consumption, stocks, production, and imports for a crop
year as necessary, but no later than the beginning of each of
the second through fourth quarters of the crop year.
``(b) Sugar Allotments.--
``(1) In general.--By the beginning of each crop year, the
Secretary shall establish for that crop year appropriate
allotments under section 359c for the marketing by processors of
sugar processed from sugar beets and from domestically produced
sugarcane at a level that the Secretary estimates will result in
no forfeitures of sugar to the Commodity Credit Corporation
under the loan program for sugar established under section 156
of the Federal Agriculture Improvement and Reform Act of 1996 (7
U.S.C. 7272).
[[Page 116 STAT. 189]]
``(2) Products.--The Secretary may include sugar products,
whose majority content is sucrose for human consumption, derived
from sugarcane, sugar beets, molasses, or sugar in the
allotments under paragraph (1) if the Secretary determines it to
be appropriate for purposes of this part.
``(c) Prohibitions.--
``(1) In general.--During any crop year or portion thereof
for which marketing allotments have been established, no
processor of sugar beets or sugarcane shall market a quantity of
sugar in excess of the allocation established for such
processor, except to enable another processor to fulfill an
allocation established for such other processor or to facilitate
the exportation of such sugar.
``(2) Civil penalty.--Any processor who knowingly violates
paragraph (1) shall be liable to the Commodity Credit
Corporation for a civil penalty in an amount equal to 3 times
the United States market value, at the time of the commission of
the violation, of that quantity of sugar involved in the
violation.
``(3) Definition of market.--For purposes of this part, the
term `market' shall mean to sell or otherwise dispose of in
commerce in the United States (including the forfeiture of sugar
under the loan program for sugar under section 156 of the
Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C.
7272) and, with respect to any integrated processor and refiner,
the movement of raw cane sugar into the refining process).
``SEC. 359c. <<NOTE: 7 USC 1359cc.>> ESTABLISHMENT OF FLEXIBLE
MARKETING ALLOTMENTS.
``(a) In General.--The Secretary shall establish flexible marketing
allotments for sugar for any crop year in which the allotments are
required under section 359b(b) in accordance with this section.
``(b) Overall Allotment Quantity.--
``(1) In general.--The Secretary shall establish the overall
quantity of sugar to be allotted for the crop year (in this part
referred to as the `overall allotment quantity') by deducting
from the sum of the estimated sugar consumption and reasonable
carryover stocks (at the end of the crop year) for the crop
year, as determined under section 359b(a)--
``(A) 1,532,000 short tons, raw value; and
``(B) carry-in stocks of sugar, including sugar in
Commodity Credit Corporation inventory.
``(2) Adjustment.--The Secretary shall adjust the overall
allotment quantity to avoid the forfeiture of sugar to the
Commodity Credit Corporation.
``(c) Marketing Allotment for Sugar Derived from Sugar Beets and
Sugar Derived from Sugarcane.--The overall allotment quantity for the
crop year shall be allotted between--
``(1) sugar derived from sugar beets by establishing a
marketing allotment for a crop year at a quantity equal to the
product of multiplying the overall allotment quantity for the
crop year by 54.35 percent; and
``(2) sugar derived from sugarcane by establishing a
marketing allotment for a crop year at a quantity equal to the
product of multiplying the overall allotment quantity for the
crop year by 45.65 percent.
[[Page 116 STAT. 190]]
``(d) Filling Cane Sugar and Beet Sugar Allotments.--
``(1) Cane sugar.--Each marketing allotment for cane sugar
established under this section may only be filled with sugar
processed from domestically grown sugarcane.
``(2) Beet sugar.--Each marketing allotment for beet sugar
established under this section may only be filled with sugar
domestically processed from sugar beets.
``(e) State Cane Sugar Allotments.--
``(1) In general.--The allotment for sugar derived from
sugarcane shall be further allotted, among the States in the
United States in which sugarcane is produced, after a hearing
(if requested by the affected sugarcane processors and growers)
and on such notice as the Secretary by regulation may prescribe,
in a fair and equitable manner as provided in this subsection
and section 359d(b)(1)(D).
``(2) Offshore allotment.--
``(A) Collectively.--Prior to the allotment of sugar
derived from sugarcane to any other State, 325,000 short
tons, raw value shall be allotted to the offshore
States.
``(B) Individually.--The collective offshore State
allotment provided for under subparagraph (A) shall be
further allotted among the offshore States in which
sugarcane is produced, after a hearing (if requested by
the affected sugarcane processors and growers) and on
such notice as the Secretary by regulation may
prescribe, in a fair and equitable manner on the basis
of--
``(i) past marketings of sugar, based on the
average of the 2 highest years of production of
raw cane sugar from the 1996 through 2000 crops;
``(ii) the ability of processors to market the
sugar covered under the allotments for the crop
year; and
``(iii) past processings of sugar from
sugarcane, based on the 3-year average of the 1998
through 2000 crop years.
``(3) Mainland allotment.--The allotment for sugar derived
from sugarcane, less the amount provided for under paragraph
(2), shall be allotted among the mainland States in the United
States in which sugarcane is produced, after a hearing (if
requested by the affected sugarcane processors and growers) and
on such notice as the Secretary by regulation may prescribe, in
a fair and equitable manner on the basis of--
``(A) past marketings of sugar, based on the average
of the 2 highest years of production of raw cane sugar
from the 1996 through 2000 crops;
``(B) the ability of processors to market the sugar
covered under the allotments for the crop year; and
``(C) past processings of sugar from sugarcane,
based on the 3 crop years with the greatest processings
(in the mainland States collectively) during the 1991
through 2000 crop years.
``(f) Filling Cane Sugar Allotments.--Except as provided in section
359e, a State cane sugar allotment established under subsection (e) for
a crop year may be filled only with sugar processed from sugarcane grown
in the State covered by the allotment.
``(g) Adjustment of Marketing Allotments.--
[[Page 116 STAT. 191]]
``(1) In general.--The Secretary shall, based on reestimates
under section 359b(a)(3), adjust upward or downward marketing
allotments in a fair and equitable manner, as the Secretary
determines appropriate, to reflect changes in estimated sugar
consumption, stocks, production, or imports.
``(2) Allocation to processors.--In the case of any increase
or decrease in an allotment, each allocation to a processor of
the allotment under section 359d, and each proportionate share
established with respect to the allotment under section 359f(c),
shall be increased or decreased by the same percentage that the
allotment is increased or decreased.
``(3) Carry-over of reductions.--Whenever a marketing
allotment for a crop year is required to be reduced during the
crop year under this subsection, if, at the time of the
reduction, the quantity of sugar marketed exceeds the
processor's reduced allocation, the allocation of an allotment
next established for the processor shall be reduced by the
quantity of the excess sugar marketed.
``(h) Suspension of Allotments.--Whenever the Secretary estimates or
reestimates under section 359b(a), or has reason to believe, that
imports of sugars, syrups or molasses for human consumption or to be
used for the extraction of sugar for human consumption, whether under a
tariff-rate quota or in excess or outside of a tariff-rate quota, will
exceed 1,532,000 short tons (raw value equivalent) (excluding any
imports attributable to reassignment under paragraph (1)(D) or (2)(C) of
section 359e(b)), and that the imports would lead to a reduction of the
overall allotment quantity, the Secretary shall suspend the marketing
allotments established under this section until such time as the imports
have been restricted, eliminated, or reduced to or below the level of
1,532,000 short tons (raw value equivalent).
``SEC. 359d. <<NOTE: 7 USC 1359dd.>> ALLOCATION OF MARKETING ALLOTMENTS.
``(a) Allocation to Processors.--Whenever marketing allotments are
established for a crop year under section 359c, in order to afford all
interested persons an equitable opportunity to market sugar under an
allotment, the Secretary shall allocate each such allotment among the
processors covered by the allotment.
``(b) Hearing and Notice.--
``(1) Cane sugar.--
``(A) In general.--The Secretary shall make
allocations for cane sugar after a hearing, if requested
by the affected sugarcane processors and growers, and on
such notice as the Secretary by regulation may
prescribe, in such manner and in such quantities as to
provide a fair, efficient, and equitable distribution of
the allocations under this paragraph. Each such
allocation shall be subject to adjustment under section
359c(g).
``(B) Multiple processor states.--Except as provided
in subparagraphs (C) and (D), the Secretary shall
allocate the allotment for cane sugar among multiple
cane sugar processors in a single State based on--
``(i) past marketings of sugar, based on the
average of the 2 highest years of production of
raw cane sugar from among the 1996 through 2000
crops;
[[Page 116 STAT. 192]]
``(ii) the ability of processors to market
sugar covered by that portion of the allotment
allocated for the crop year; and
``(iii) past processings of sugar from
sugarcane, based on the average of the 3 highest
years of production during the 1996 through 2000
crop years.
``(C) Talisman processing facility.--In the case of
allotments under subparagraph (B) attributable to the
operations of the Talisman processing facility before
the date of enactment of this subparagraph, the
Secretary shall allocate the allotment among processors
in the State under subparagraph (A) in accordance with
the agreements of March 25 and 26, 1999, between the
affected processors and the Secretary of the Interior.
``(D) Proportionate share states.--In the case of
States subject to section 359f(c), the Secretary shall
allocate the allotment for cane sugar among multiple
cane sugar processors in a single State based on--
``(i) past marketings of sugar, based on the
average of the 2 highest years of production of
raw cane sugar from among the 1997 through 2001
crop years;
``(ii) the ability of processors to market
sugar covered by that portion of the allotments
allocated for the crop year; and
``(iii) past processings of sugar from
sugarcane, based on the average of the 2 highest
crop years of crop production during the 1997
through 2001 crop years.
``(E) New entrants.--
``(i) In general.--Notwithstanding
subparagraphs (B) and (D), the Secretary, on
application of any processor that begins
processing sugarcane on or after the date of
enactment of this subparagraph, and after a
hearing (if requested by the affected sugarcane
processors and growers) and on such notice as the
Secretary by regulation may prescribe, may provide
the processor with an allocation that provides a
fair, efficient and equitable distribution of the
allocations from the allotment for the State in
which the processor is located.
``(ii) Proportionate share states.--In the
case of proportionate share States, the Secretary
shall establish proportionate shares in a quantity
sufficient to produce the sugarcane required to
satisfy the allocations.
``(iii) Limitations.--The allotment for a new
processor under this subparagraph shall not
exceed--
``(I) in the case of the first crop
year of operation of a new processor,
50,000 short tons (raw value); and
``(II) in the case of each
subsequent crop year of operation of the
new processor, a quantity established by
the Secretary in accordance with this
subparagraph and the criteria described
in subparagraph (B) or (D), as
applicable.
``(iv) New entrant states.--
``(I) In general.--Notwithstanding
subparagraphs (A) and (C) of section
359c(e)(3), to
[[Page 116 STAT. 193]]
accommodate an allocation under clause
(i) to a new processor located in a new
entrant mainland State, the Secretary
shall provide the new entrant mainland
State with an allotment.
``(II) Effect on other allotments.--
The allotment to any new entrant
mainland State shall be subtracted, on a
pro rata basis, from the allotments
otherwise allotted to each mainland
State under section 359c(e)(3).
``(v) Adverse effects.--Before providing an
initial processor allocation or State allotment to
a new entrant processor or a new entrant State
under this subparagraph, the Secretary shall take
into consideration any adverse effects that the
provision of the allocation or allotment may have
on existing cane processors and producers in
mainland States.
``(vi) Ability to market.--Consistent with
section 359c and this section, any processor
allocation or State allotment made to a new
entrant processor or to a new entrant State under
this subparagraph shall be provided only after the
applicant processor, or the applicable processors
in the State, have demonstrated the ability to
process, produce, and market (including the
transfer or delivery of the raw cane sugar to a
refinery for further processing or marketing) raw
cane sugar for the crop year for which the
allotment is applicable.
``(vii) Prohibition.--Not more than 1
processor allocation provided under this
subparagraph may be applicable to any individual
sugar processing facility.
``(F) Transfer of ownership.--Except as otherwise
provided in section 359f(c)(8), if a sugarcane processor
is sold or otherwise transferred to another owner or is
closed as part of an affiliated corporate group
processing consolidation, the Secretary shall transfer
the allotment allocation for the processor to the
purchaser, new owner, successor in interest, or any
remaining processor of an affiliated entity, as
applicable, of the processor.
``(2) Beet sugar.--
``(A) In general.--Except as otherwise provided in
this paragraph and sections 359c(g), 359e(b), and
359f(b), the Secretary shall make allocations for beet
sugar among beet sugar processors for each crop year
that allotments are in effect on the basis of the
adjusted weighted average quantity of beet sugar
produced by the processors for each of the 1998 through
2000 crop years, as determined under this paragraph.
``(B) Quantity.--The quantity of an allocation made
for a beet sugar processor for a crop year under
subparagraph (A) shall bear the same ratio to the
quantity of allocations made for all beet sugar
processors for the crop year as the adjusted weighted
average quantity of beet sugar produced by the processor
(as determined under subparagraphs (C) and (D)) bears to
the total of the adjusted weighted average quantities of
beet sugar produced by all processors (as so
determined).
[[Page 116 STAT. 194]]
``(C) Weighted average quantity.--Subject to
subparagraph (D), the weighted quantity of beet sugar
produced by a beet sugar processor during each of the
1998 through 2000 crop years shall be (as determined by
the Secretary)--
``(i) in the case of the 1998 crop year, 25
percent of the quantity of beet sugar produced by
the processor during the crop year;
``(ii) in the case of the 1999 crop year, 35
percent of the quantity of beet sugar produced by
the processor during the crop year; and
``(iii) in the case of the 2000 crop year, 40
percent of the quantity of beet sugar produced by
the processor (including any quantity of sugar
received from the Commodity Credit Corporation)
during the crop year.
``(D) Adjustments.--
``(i) In general.--The Secretary shall adjust
the weighted average quantity of beet sugar
produced by a beet sugar processor during the 1998
through 2000 crop years under subparagraph (C) if
the Secretary determines that the processor--
``(I) during the 1996 through 2000
crop years, opened a sugar beet
processing factory;
``(II) during the 1998 through 2000
crop years, closed a sugar beet
processing factory;
``(III) during the 1998 through 2000
crop years, constructed a molasses
desugarization facility; or
``(IV) during the 1998 through 2000
crop years, suffered substantial quality
losses on sugar beets stored during any
such crop year.
``(ii) Quantity.--The quantity of beet sugar
produced by a beet sugar processor under
subparagraph (C) shall be--
``(I) in the case of a processor
that opened a sugar beet processing
factory, increased by 1.25 percent of
the total of the adjusted weighted
average quantities of beet sugar
produced by all processors during the
1998 through 2000 crop years (without
consideration of any adjustment under
this subparagraph) for each sugar beet
processing factory that is opened by the
processor;
``(II) in the case of a processor
that closed a sugar beet processing
factory, decreased by 1.25 percent of
the total of the adjusted weighted
average quantities of beet sugar
produced by all processors during the
1998 through 2000 crop years (without
consideration of any adjustment under
this subparagraph) for each sugar beet
processing factory that is closed by the
processor;
``(III) in the case of a processor
that constructed a molasses
desugarization facility, increased by
0.25 percent of the total of the
adjusted weighted average quantities of
beet sugar produced by all processors
during the 1998 through 2000 crop years
(without consideration of any adjustment
under this subparagraph) for each
[[Page 116 STAT. 195]]
molasses desugarization facility that is
constructed by the processor; and
``(IV) in the case of a processor
that suffered substantial quality losses
on stored sugar beets, increased by 1.25
percent of the total of the adjusted
weighted average quantities of beet
sugar produced by all processors during
the 1998 through 2000 crop years
(without consideration of any adjustment
under this subparagraph).
``(E) Permanent termination of operations of a
processor.--If a processor of beet sugar has been
dissolved, liquidated in a bankruptcy proceeding, or
otherwise has permanently terminated operations (other
than in conjunction with a sale or other disposition of
the processor or the assets of the processor), the
Secretary shall--
``(i) eliminate the allocation of the
processor provided under this section; and
``(ii) distribute the allocation to other beet
sugar processors on a pro rata basis.
``(F) Sale of all assets of a processor to another
processor.--If a processor of beet sugar (or all of the
assets of the processor) is sold to another processor of
beet sugar, the Secretary shall transfer the allocation
of the seller to the buyer unless the allocation has
been distributed to other sugar beet processors under
subparagraph (E).
``(G) Sale of factories of a processor to another
processor.--
``(i) In general.--Subject to subparagraphs
(E) and (F), if 1 or more factories of a processor
of beet sugar (but not all of the assets of the
processor) are sold to another processor of beet
sugar during a crop year, the Secretary shall
assign a pro rata portion of the allocation of the
seller to the allocation of the buyer to reflect
the historical contribution of the production of
the sold factory or factories to the total
allocation of the seller.
``(ii) Application of allocation.--The
assignment of the allocation under clause (i)
shall apply--
``(I) during the remainder of the
crop year during which the sale
described in clause (i) occurs (referred
to in this subparagraph as the `initial
crop year'); and
``(II) each subsequent crop year
(referred in this subparagraph as a
`subsequent crop year'), subject to
clause (iii).
``(iii) Subsequent crop years.--
``(I) In general.--The assignment of
the allocation under clause (i) shall
apply during each subsequent crop year
unless the acquired factory or factories
continue in operation for less than the
initial crop year and the first
subsequent crop year.
``(II) Reassignment.--If the
acquired factory or factories do not
continue in operation for the complete
initial crop year and the first
subsequent
[[Page 116 STAT. 196]]
crop year, the Secretary shall reassign
the temporary allocation to other
processors of beet sugar on a pro rata
basis.
``(iv) Use of other factories to fill
allocation.--If the transferred allocation to the
buyer for the purchased factory or factories
cannot be filled by the production of the
purchased factory or factories for the initial
crop year or a subsequent crop year, the remainder
of the transferred allocation may be filled by
beet sugar produced by the buyer from other
factories of the buyer.
``(H) New entrants starting production or reopening
factories.--
``(i) In general.--Except as provided by
clause (ii), if an individual or entity that does
not have an allocation of beet sugar under this
part (referred to in this paragraph as a `new
entrant') starts processing sugar beets after the
date of enactment of this subparagraph, or
acquires and reopens a factory that produced beet
sugar during previous crop years that (at the time
of acquisition) has no allocation associated with
the factory under this part, the Secretary shall--
``(I) assign an allocation for beet
sugar to the new entrant that provides a
fair and equitable distribution of the
allocations for beet sugar; and
``(II) reduce the allocations for
beet sugar of all other processors on a
pro rata basis to reflect the new
allocation.
``(ii) Exception.--If a new entrant acquires
and reopens a factory that previously produced
beet sugar from sugar beets and from sugar beet
molasses but the factory last processed sugar
beets during the 1997 crop year and the new
entrant starts to process sugar beets at such
factory after the date of enactment of this
clause, the Secretary shall--
``(I) assign an allocation for beet
sugar to the new entrant that is not
less than the greater of 1.67 percent of
the total of the adjusted weighted
average quantities of beet sugar
produced by all processors during the
1998 through 2000 crop years as
determined under subsection (b)(2)(C),
or 1,500,000 hundredweights; and
``(II) reduce the allocations for
beet sugar of all other processors on a
pro rata basis to reflect the new
allocation.
``(I) New entrants acquiring ongoing factories with
production history.--If a new entrant acquires a factory
that has production history during the period of the
1998 through 2000 crop years and that is producing beet
sugar at the time the allocations are made from a
processor that has an allocation of beet sugar, the
Secretary shall transfer a portion of the allocation of
the seller to the new entrant to reflect the historical
contribution of the production of the sold factory to
the total allocation of the seller.
[[Page 116 STAT. 197]]
``SEC. 359e. <<NOTE: 7 USC 1359ee.>> REASSIGNMENT OF DEFICITS.
``(a) Estimates of Deficits.--At any time allotments are in effect
under this part, the Secretary, from time to time, shall determine
whether (in view of then-current inventories of sugar, the estimated
production of sugar and expected marketings, and other pertinent
factors) any processor of sugarcane will be unable to market the sugar
covered by the portion of the State cane sugar allotment allocated to
the processor and whether any processor of sugar beets will be unable to
market sugar covered by the portion of the beet sugar allotment
allocated to the processor.
``(b) Reassignment of Deficits.--
``(1) Cane sugar.--If the Secretary determines that any
sugarcane processor who has been allocated a share of a State
cane sugar allotment will be unable to market the processor's
allocation of the State's allotment for the crop year--
``(A) the Secretary first shall reassign the
estimated quantity of the deficit to the allocations for
other processors within that State, depending on the
capacity of each other processor to fill the portion of
the deficit to be assigned to it and taking into account
the interests of producers served by the processors;
``(B) if after the reassignments the deficit cannot
be completely eliminated, the Secretary shall reassign
the estimated quantity of the deficit proportionately to
the allotments for other cane sugar States, depending on
the capacity of each other State to fill the portion of
the deficit to be assigned to it, with the reassigned
quantity to each State to be allocated among processors
in that State in proportion to the allocations of the
processors;
``(C) if after the reassignments the deficit cannot
be completely eliminated, the Secretary shall reassign
the estimated quantity of the deficit to the Commodity
Credit Corporation and shall sell such quantity of sugar
from inventories of the Corporation unless the Secretary
determines that such sales would have a significant
effect on the price of sugar; and
``(D) if after the reassignments and sales, the
deficit cannot be completely eliminated, the Secretary
shall reassign the remainder to imports.
``(2) Beet sugar.--If the Secretary determines that a sugar
beet processor who has been allocated a share of the beet sugar
allotment will be unable to market that allocation--
``(A) the Secretary first shall reassign the
estimated quantity of the deficit to the allotments for
other sugar beet processors, depending on the capacity
of each other processor to fill the portion of the
deficit to be assigned to it and taking into account the
interests of producers served by the processors;
``(B) if after the reassignments the deficit cannot
be completely eliminated, the Secretary shall reassign
the estimated quantity of the deficit to the Commodity
Credit Corporation and shall sell such quantity of sugar
from inventories of the Corporation unless the Secretary
determines that such sales would have a significant
effect on the price of sugar; and
[[Page 116 STAT. 198]]
``(C) if after the reassignments and sales, the
deficit cannot be completely eliminated, the Secretary
shall reassign the remainder to imports.
``(3) Corresponding increase.--The allocation of each
processor receiving a reassigned quantity of an allotment under
this subsection for a crop year shall be increased to reflect
the reassignment.
``SEC. 359f. <<NOTE: 7 USC 1359ff.>> PROVISIONS APPLICABLE TO
PRODUCERS.
``(a) Processor Assurances.--
``(1) In general.--If allotments for a crop year are
allocated to processors under section 359d, the Secretary shall
obtain from the processors such assurances as the Secretary
considers adequate that the allocation will be shared among
producers served by the processor in a fair and equitable manner
that adequately reflects producers' production histories.
``(2) Arbitration.--
``(A) In general.--Any dispute between a processor
and a producer, or group of producers, with respect to
the sharing of the allocation to the processor shall be
resolved through arbitration by the Secretary on the
request of either party.
``(B) Period.--The <<NOTE: Deadlines.>> arbitration
shall, to the maximum extent practicable, be--
``(i) commenced not more than 45 days after
the request; and
``(ii) completed not more than 60 days after
the request.
``(b) Sugar Beet Processing Facility Closures.--
``(1) In general.--If a sugar beet processing facility is
closed and the sugar beet growers that previously delivered
beets to the facility elect to deliver their beets to another
processing company, the growers may petition the Secretary to
modify allocations under this part to allow the delivery.
``(2) Increased allocation for processing company.--The
Secretary may increase the allocation to the processing company
to which the growers elect to deliver their sugar beets, with
the approval of the processing company, to a level that does not
exceed the processing capacity of the processing company, to
accommodate the change in deliveries.
``(3) Decreased allocation for closed company.--The
increased allocation shall be deducted from the allocation to
the company that owned the processing facility that has been
closed and the remaining allocation shall be unaffected.
``(4) Timing.--The <<NOTE: Deadline.>> determinations of the
Secretary on the issues raised by the petition shall be made
within 60 days after the filing of the petition.
``(c) Proportionate Shares of Certain Allotments.--
``(1) In general.--
``(A) States affected.--In any case in which a State
allotment is established under section 359c(f) and there
are in excess of 250 sugarcane producers in the State
(other than Puerto Rico), the Secretary shall make a
determination under subparagraph (B).
``(B) Determination.--The Secretary shall determine,
for each State allotment described in subparagraph (A),
whether the production of sugarcane, in the absence of
[[Page 116 STAT. 199]]
proportionate shares, will be greater than the quantity
needed to enable processors to fill the allotment and
provide a normal carryover inventory of sugar.
``(2) Establishment of proportionate shares.--If the
Secretary determines under paragraph (1) that the quantity of
sugarcane produced by producers in the area covered by a State
allotment for a crop year will be in excess of the quantity
needed to enable processors to fill the allotment for the crop
year and provide a normal carryover inventory of sugar, the
Secretary shall establish a proportionate share for each
sugarcane-producing farm that limits the acreage of sugarcane
that may be harvested on the farm for sugar or seed during the
crop year the allotment is in effect as provided in this
subsection. Each such proportionate share shall be subject to
adjustment under paragraph (7) and section 359c(g).
``(3) Method of determining.--For purposes of determining
proportionate shares for any crop of sugarcane:
``(A) The Secretary shall establish the State's per-
acre yield goal for a crop of sugarcane at a level (not
less than the average per-acre yield in the State for
the 2 highest years from among the 1999, 2000, and 2001
crop years, as determined by the Secretary) that will
ensure an adequate net return per pound to producers in
the State, taking into consideration any available
production research data that the Secretary considers
relevant.
``(B) The Secretary shall adjust the per-acre yield
goal by the average recovery rate of sugar produced from
sugarcane by processors in the State.
``(C) The Secretary shall convert the State
allotment for the crop year involved into a State
acreage allotment for the crop by dividing the State
allotment by the per-acre yield goal for the State, as
established under subparagraph (A) and as further
adjusted under subparagraph (B).
``(D) The Secretary shall establish a uniform
reduction percentage for the crop by dividing the State
acreage allotment, as determined for the crop under
subparagraph (C), by the sum of all adjusted acreage
bases in the State, as determined by the Secretary.
``(E) The uniform reduction percentage for the crop,
as determined under subparagraph (D), shall be applied
to the acreage base for each sugarcane-producing farm in
the State to determine the farm's proportionate share of
sugarcane acreage that may be harvested for sugar or
seed.
``(4) Acreage base.--For purposes of this subsection, the
acreage base for each sugarcane-producing farm shall be
determined by the Secretary, as follows:
``(A) The acreage base for any farm shall be the
number of acres that is equal to the average of the
acreage planted and considered planted for harvest for
sugar or seed on the farm in the 2 highest of the 1999,
2000, and 2001 crop years.
``(B) Acreage planted to sugarcane that producers on
a farm were unable to harvest to sugarcane for sugar or
seed because of drought, flood, other natural disaster,
or other condition beyond the control of the producers
may
[[Page 116 STAT. 200]]
be considered as harvested for the production of sugar
or seed for purposes of this paragraph.
``(5) Violation.--
``(A) In general.--Whenever proportionate shares are
in effect in a State for a crop of sugarcane, producers
on a farm shall not knowingly harvest, or allow to be
harvested, for sugar or seed an acreage of sugarcane in
excess of the farm's proportionate share for the crop
year, or otherwise violate proportionate share
regulations issued by the Secretary under section
359h(a).
``(B) Determination of violation.--No producer shall
be considered to have violated subparagraph (A) unless
the processor of the sugarcane harvested by such
producer from acreage in excess of the proportionate
share of the farm markets an amount of sugar that
exceeds the allocation of such processor for a crop
year.
``(C) Civil penalty.--Any producer on a farm who
violates subparagraph (A) by knowingly harvesting, or
allowing to be harvested, an acreage of sugarcane in
excess of the farm's proportionate share shall be liable
to the Commodity Credit Corporation for a civil penalty
equal to one and one-half times the United States market
value of the quantity of sugar that is marketed by the
processor of such sugarcane in excess of the allocation
of such processor for the crop year. The Secretary shall
prorate penalties imposed under this subparagraph in a
fair and equitable manner among all the producers of
sugarcane harvested from excess acreage that is acquired
by such processor.
``(6) Waiver.--Notwithstanding the preceding subparagraph,
the Secretary may authorize the county and State committees
established under section 8(b) of the Soil Conservation and
Domestic Allotment Act (16 U.S.C. 590h(b)) to waive or modify
deadlines and other proportionate share requirements in cases in
which lateness or failure to meet the other requirements does
not affect adversely the operation of proportionate shares.
``(7) Adjustments.--Whenever the Secretary determines that,
because of a natural disaster or other condition beyond the
control of producers that adversely affects a crop of sugarcane
subject to proportionate shares, the amount of sugarcane
produced by producers subject to the proportionate shares will
not be sufficient to enable processors in the State to meet the
State's cane sugar allotment and provide a normal carryover
inventory of sugar, the Secretary may uniformly allow producers
to harvest an amount of sugarcane in excess of their
proportionate share, or suspend proportionate shares entirely,
as necessary to enable processors to meet the State allotment
and provide a normal carryover inventory of sugar.
``(8) Processing facility closures.--
``(A) In general.--If a sugarcane processing
facility subject to this subsection is closed and the
sugarcane growers that delivered sugarcane to the
facility prior to closure elect to deliver their
sugarcane to another processing company, the growers may
petition the Secretary to modify allocations under this
part to allow the delivery.
[[Page 116 STAT. 201]]
``(B) Increased allocation for processing company.--
The Secretary may increase the allocation to the
processing company to which the growers elect to deliver
the sugarcane, with the approval of the processing
company, to a level that does not exceed the processing
capacity of the processing company, to accommodate the
change in deliveries.
``(C) Decreased allocation for closed company.--The
increased allocation shall be deducted from the
allocation to the company that owned the processing
facility that has been closed and the remaining
allocation shall be unaffected.
``(D) Timing.--The <<NOTE: Deadline.>>
determinations of the Secretary on the issues raised by
the petition shall be made within 60 days after the
filing of the petition.
``SEC. 359g. <<NOTE: 7 USC 1359gg.>> SPECIAL RULES.
``(a) Transfer of Acreage Base History.--For the purpose of
establishing proportionate shares for sugarcane farms under section
359f(c), the Secretary, on application of any producer, with the written
consent of all owners of a farm, may transfer the acreage base history
of the farm to any other parcels of land of the applicant.
``(b) Preservation of Acreage Base History.--If for reasons beyond
the control of a producer on a farm, the producer is unable to harvest
an acreage of sugarcane for sugar or seed with respect to all or a
portion of the proportionate share established for the farm under
section 359f(c), the Secretary, on the application of the producer and
with the written consent of all owners of the farm, may preserve for a
period of not more than 5 consecutive years the acreage base history of
the farm to the extent of the proportionate share involved. The
Secretary may permit the proportionate share to be redistributed to
other farms, but no acreage base history for purposes of establishing
acreage bases shall accrue to the other farms by virtue of the
redistribution of the proportionate share.
``(c) Revisions of Allocations and Proportionate Shares.--The
Secretary, after such notice as the Secretary by regulation may
prescribe, may revise or amend any allocation of a marketing allotment
under section 359d, or any proportionate share established or adjusted
for a farm under section 359f(c), on the same basis as the initial
allocation or proportionate share was required to be established.
``(d) Transfers of Mill Allocations.--
``(1) Transfer authorized.--A producer in a proportionate
share State, upon written consent from all crop-share owners (or
the representative of the crop-share owners) of a farm, and from
the processing company holding the applicable allocation for
such shares, may deliver sugarcane to another processing company
if the additional delivery, when combined with such other
processing company's existing deliveries, does not exceed the
processing capacity of the company.
``(2) Allocation adjustment.--Notwithstanding section 359d,
the Secretary shall adjust the allocations of each of such
processing companies affected by a transfer under paragraph (1)
to reflect the change in deliveries, based on the product of--
[[Page 116 STAT. 202]]
``(A) the number of acres of proportionate shares
being transferred; and
``(B) the State's per acre yield goal established
under section 359f(c)(3).
``SEC. 359h. <<NOTE: 7 USC 1359hh.>> REGULATIONS; VIOLATIONS;
PUBLICATION OF SECRETARY'S DETERMINATIONS; JURISDICTION OF
THE COURTS; UNITED STATES ATTORNEYS.
``(a) Regulations.--The Secretary or the Commodity Credit
Corporation, as appropriate, shall issue such regulations as may be
necessary to carry out the authority vested in the Secretary in
administering this part.
``(b) Violation.--Any person knowingly violating any regulation of
the Secretary issued under subsection (a) shall be subject to a civil
penalty of not more than $5,000 for each violation.
``(c) Publication in Federal Register.--Each determination issued by
the Secretary to establish, adjust, or suspend allotments under this
part shall be promptly published in the Federal Register and shall be
accompanied by a statement of the reasons for the determination.
``(d) Jurisdiction of Courts; United States Attorneys.--
``(1) Jurisdiction of courts.--The several district courts
of the United States are vested with jurisdiction specifically
to enforce, and to prevent and restrain any person from
violating, this part or any regulation issued thereunder.
``(2) United states attorneys.--Whenever the Secretary shall
so request, it shall be the duty of the several United States
attorneys, in their respective districts, to institute
proceedings to enforce the remedies and to collect the penalties
provided for in this part. The Secretary may elect not to refer
to a United States attorney any violation of this part or
regulation when the Secretary determines that the administration
and enforcement of this part would be adequately served by
written notice or warning to any person committing the
violation.
``(e) Nonexclusivity of Remedies.--The remedies and penalties
provided for in this part shall be in addition to, and not exclusive of,
any remedies or penalties existing at law or in equity.
``SEC. 359i. <<NOTE: 7 USC 1359ii.>> APPEALS.
``(a) In General.--An appeal may be taken to the Secretary from any
decision under section 359d establishing allocations of marketing
allotments, or under section 359f, by any person adversely affected by
reason of any such decision.
``(b) Procedure.--
``(1) Notice of appeal.--Any such appeal shall be taken by
filing with the Secretary, within 20 days after the decision
complained of is effective, notice in writing of the appeal and
a statement of the reasons therefor. Unless a later date is
specified by the Secretary as part of the Secretary's decision,
the decision complained of shall be considered to be effective
as of the date on which announcement of the decision is made.
The Secretary shall deliver a copy of any notice of appeal to
each person shown by the records of the Secretary to be
adversely affected by reason of the decision appealed, and shall
at all times thereafter permit any such person to inspect and
make copies of appellant's reasons for the appeal and shall on
application permit the person to intervene in the appeal.
[[Page 116 STAT. 203]]
``(2) Hearing.--The Secretary shall provide each appellant
an opportunity for a hearing before an administrative law judge
in accordance with sections 554 and 556 of title 5, United
States Code. The expenses for conducting the hearing shall be
reimbursed by the Commodity Credit Corporation.
``(c) Special Appeal Process Regarding Beet Sugar Allocations.--
``(1) Appeal authorized.--Beginning after the 2006 crop
year, a processor that has an allocation of the beet sugar
allotment under this part (referred to in this subsection as a
`petitioner') may file a notice of appeal with the Secretary
regarding the petitioner's beet sugar allocation. Except as
provided in paragraph (2), the Secretary shall consider the
appeal if the notice alleges that any processor that has a beet
sugar allocation has failed to fill at least 82.5 percent of its
allocation of the beet sugar allotment with sugar produced by it
or received from the Commodity Credit Corporation in 2 out of
the 3 crop years preceding the crop year in which the appeal is
filed. A processor that is alleged to have failed to fill at
least 82.5 percent of its allocation shall be allowed to fully
participate in the appeal.
``(2) Exceptions.--An appeal under paragraph (1) shall not
be based on the failure of a processor to fill at least 82.5
percent of its allocation because of drought, flood, hail, or
other weather disaster, as determined by the Secretary. The
determination by the Secretary shall not require a formal
disaster declaration.
``(3) Response to appeal.--Upon the petitioner making an
appeal to the Secretary, and upon a review by the Secretary of
how processors have filled their allocations, the Secretary
may--
``(A) assign an increased allocation for beet sugar
to the petitioner that provides a fair and equitable
distribution of the allocations for beet sugar, taking
into account--
``(i) production history during the period
beginning on April 4, 1996, and through the date
of enactment of the Farm Security and Rural
Investment Act of 2002;
``(ii) capital investment during that period;
``(iii) increases in United States sugar
consumption; and
``(iv) the ability or inability of processors
to fill the allocations they have received under
this part; and
``(B) reduce, correspondingly, the allocation for
beet sugar of each processor determined to have failed
to fill at least 82.5 percent of its allocation of the
beet sugar allotment as described in paragraph (1).
``(4) Filing deadline.--For purposes of the filing deadline
specified in subsection (b)(1), the 20-day period shall commence
on the date on which the Secretary announces the allocations for
the subsequent crop year or October 1, whichever is earlier.
``SEC. 359j. <<NOTE: 7 USC 1359jj.>> ADMINISTRATION.
``(a) Use of Certain Agencies.--In carrying out this part, the
Secretary may use the services of local committees of sugar beet or
sugarcane producers, sugarcane processors, or sugar beet
[[Page 116 STAT. 204]]
processors, State and county committees established under section 8(b)
of the Soil Conservation and Domestic Allotment Act (16 U.S.C. 590h(b)),
and the departments and agencies of the United States Government.
``(b) Use of Commodity Credit Corporation.--The Secretary shall use
the services, facilities, funds, and authorities of the Commodity Credit
Corporation to carry out this part.
``SEC. 359k. <<NOTE: 7 USC 1359kk.>> REALLOCATING SUGAR QUOTA IMPORT
SHORTFALLS.
``(a) In General.--Notwithstanding any other provision of law, on or
after June 1 of each of the 2002 through 2007 calendar years, the United
States Trade Representative, in consultation with the Secretary, shall
determine the amount of the quota of cane sugar used by each qualified
supplying country for that crop year, and may reallocate the unused
quota for that crop year among qualified supplying countries.
``(b) Qualified Supplying Country Defined.--In this section, the
term `qualified supplying country' means one of the following foreign
countries that is allowed to export cane sugar to the United States
under an agreement or any other country with which the United States has
an agreement relating to the importation of cane sugar:
Argentina
Australia
Barbados
Belize
Bolivia
Brazil
Colombia
Republic of the Congo
Costa Rica
Dominican Republic
Ecuador
El Salvador
Fiji
Gabon
Guatemala
Guyana
Haiti
Honduras
India
Cote D'Ivoire, formerly known as
the Ivory Coast
Jamaica
Madagascar
Malawi
Mauritius
Mexico
Mozambique
Nicaragua
Panama
Papua New Guinea
Paraguay
Peru
Philippines
St. Kitts and Nevis
South Africa
Swaziland
Taiwan
Thailand
Trinidad-Tobago
Uruguay
Zimbabwe.''.
[[Page 116 STAT. 205]]
Subtitle E--Dairy
SEC. 1501. <<NOTE: 7 USC 7981.>> MILK PRICE SUPPORT PROGRAM.
(a) Support Activities.--During the period beginning on June 1,
2002, and ending on December 31, 2007, 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 produced
from the milk.
(b) Rate.--During the period specified in subsection (a), the price
of milk shall be supported at a rate equal to $9.90 per hundredweight
for milk containing 3.67 percent butterfat.
(c) Purchase Prices.--
(1) Uniform 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.
(2) Sufficient prices.--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 Purchase 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 Secretary 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) Commodity Credit Corporation.--The Secretary shall carry out the
program authorized by this section through the Commodity Credit
Corporation.
SEC. 1502. <<NOTE: 7 USC 7982.>> NATIONAL DAIRY MARKET LOSS PAYMENTS.
(a) Definitions.--In this section:
(1) Class i milk.--The term `Class I milk' means milk
(including milk components) classified as Class I milk under a
Federal milk marketing order.
(2) Eligible production.--The term `eligible production'
means milk produced by a producer in a participating State.
(3) Federal milk marketing order.--The term `Federal milk
marketing order' means an 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.
[[Page 116 STAT. 206]]
(4) Participating state.--The term `participating State'
means each State.
(5) Producer.--The term `producer' means an individual or
entity that directly or indirectly (as determined by the
Secretary)--
(A) shares in the risk of producing milk; and
(B) makes contributions (including land, labor,
management, equipment, or capital) to the dairy farming
operation of the individual or entity that are at least
commensurate with the share of the individual or entity
of the proceeds of the operation.
(b) Payments.--The <<NOTE: Contracts.>> Secretary shall offer to
enter into contracts with producers on a dairy farm located in a
participating State under which the producers receive payments on
eligible production.
(c) Amount.--Payments to a producer under this section shall be
calculated by multiplying (as determined by the Secretary)--
(1) the payment quantity for the producer during the
applicable month established under subsection (d);
(2) the amount equal to--
(A) $16.94 per hundredweight; less
(B) the Class I milk price per hundredweight in
Boston under the applicable Federal milk marketing
order; by
(3) 45 percent.
(d) Payment Quantity.--
(1) In general.--Subject to paragraph (2), the payment
quantity for a producer during the applicable month under this
section shall be equal to the quantity of eligible production
marketed by the producer during the month.
(2) Limitation.--The payment quantity for all producers on a
single dairy operation during the months of the applicable
fiscal year for which the producers receive payments under
subsection (b) shall not exceed 2,400,000 pounds. For purposes
of determining whether producers are producers on separate dairy
operations or a single dairy operation, the Secretary shall
apply the same standards as were applied in implementing the
dairy program under section 805 of the Agriculture, Rural
Development, Food and Drug Administration, and Related Agencies
Appropriations Act, 2001 (as enacted into law by Public Law 106-
387; 114 Stat. 1549A-50).
(3) Reconstitution.--The Secretary shall promulgate
regulations to ensure that a producer does not reconstitute a
dairy operation for the sole purpose of receiving additional
payments under this section.
(e) Payments.--A <<NOTE: Deadline.>> payment under a contract under
this section shall be made on a monthly basis not later than 60 days
after the last day of the month for which the payment is made.
(f) Signup.--The <<NOTE: Contracts.>> Secretary shall offer to enter
into contracts under this section during the period beginning on the
date that is 60 days after the date of enactment of this Act and ending
on September 30, 2005.
(g) Duration of Contract.--
(1) In general.--Except as provided in paragraph (2) and
subsection (h), any contract entered into by producers on a
dairy farm under this section shall cover eligible production
marketed by the producers on the dairy farm during the period
starting with the first day of month the producers on the
[[Page 116 STAT. 207]]
dairy farm enter into the contract and ending on September 30,
2005.
(2) Violations.--If a producer violates the contract, the
Secretary may--
(A) terminate the contract and allow the producer to
retain any payments received under the contract; or
(B) allow the contract to remain in effect and
require the producer to repay a portion of the payments
received under the contract based on the severity of the
violation.
(h) Transition Rule.--In addition to any payment that is otherwise
available under this section, if the producers on a dairy farm enter
into a contract under this section, the Secretary shall make a payment
in accordance with the formula specified in subsection (c) on the
quantity of eligible production of the producer marketed during the
period beginning on December 1, 2001, and ending on the last day of the
month preceding the month the producers on the dairy farm entered into
the contract.
SEC. 1503. DAIRY EXPORT INCENTIVE AND DAIRY INDEMNITY PROGRAMS.
(a) Dairy Export Incentive Program.--Section 153(a) of the Food
Security Act of 1985 (15 U.S.C. 713a-14(a)) is amended by striking
``2002'' and inserting ``2007''.
(b) Dairy Indemnity Program.--Section 3 of Public Law 90-484 (7
U.S.C. 450l) is amended by striking ``1995'' and inserting ``2007''.
SEC. 1504. DAIRY PRODUCT MANDATORY REPORTING.
Section 272(1) of the Agricultural Marketing Act of 1946 (7 U.S.C.
1637a(1)) is amended--
(1) by striking ``means manufactured dairy products'' and
inserting ``means--
``(A) manufactured dairy products'';
(2) by striking the period at the end and inserting ``;
and''; and
(3) by adding at the end the following:
``(B) substantially identical products designated by
the Secretary.''.
SEC. 1505. FUNDING OF DAIRY PROMOTION AND RESEARCH PROGRAM.
(a) Definitions.--Section 111 of the Dairy Production Stabilization
Act of 1983 (7 U.S.C. 4502) is amended--
(1) in subsection (k), by striking ``and'' at the end;
(2) in subsection (l), by striking the period at the end and
inserting a semicolon; and
(3) by adding at the end the following:
``(m) the term `imported dairy product' means any dairy
product that is imported into the United States (as defined in
subsection (l)), including dairy products imported into the
United States in the form of--
``(1) milk, cream, and fresh and dried dairy
products;
``(2) butter and butterfat mixtures;
``(3) cheese; and
``(4) casein and mixtures;
``(n) the term `importer' means a person that imports an
imported dairy product into the United States; and
``(o) the term `Customs' means the United States Customs
Service.''.
[[Page 116 STAT. 208]]
(b) Representation of Importers on Board.--Section 113(b) of the
Dairy Production Stabilization Act of 1983 (7 U.S.C. 4504(b)) is
amended--
(1) by inserting ``National Dairy Promotion and Research
Board.--'' after ``(b)'';
(2) by designating the first through ninth sentences as
paragraphs (1) through (5) and paragraphs (7) through (10),
respectively, and indenting the paragraphs appropriately;
(3) in paragraph (2) (as so designated), by striking
``Members'' and inserting ``Except as provided in paragraph (6),
the members'';
(4) by inserting after paragraph (5) (as so designated) the
following:
``(6) Importers.--
``(A) Initial representation.--In making initial
appointments to the Board of importer representatives,
the Secretary shall appoint 2 members who represent
importers of dairy products and are subject to
assessments under the order.
``(B) Subsequent representation.--At least once
every 3 years after the initial appointment of importer
representatives under subparagraph (A), the Secretary
shall review the average volume of domestic production
of dairy products compared to the average volume of
imports of dairy products into the United States during
the previous 3 years and, on the basis of that review,
shall reapportion importer representation on the Board
to reflect the proportional share of the United States
market by domestic production and imported dairy
products.
``(C) Additional members; nominations.--The members
appointed under this paragraph--
``(i) shall be in addition to the total number
of members appointed under paragraph (2); and
``(ii) shall be appointed from nominations
submitted by importers under such procedures as
the Secretary determines to be appropriate.''; and
(5) in paragraph (8) (as so designated), by striking ``is
produced'' and inserting ``is produced as well as importers of
dairy products''.
(c) Budgets.--Section 113(e) of the Dairy Production Stabilization
Act of 1983 (7 U.S.C. 4504(e)) is amended--
(1) by striking ``(e)'' and inserting:
``(e) Budgets.--
``(1) Preparation and submission.--'';
(2) by striking the last sentence; and
(3) by adding at the end the following:
``(2) Foreign market efforts.--The order shall authorize the
Board to expend in the maintenance and expansion of foreign
markets an amount not to exceed the amount collected from United
States producers for a fiscal year. Of those funds, for each of
the 2002 through 2007 fiscal years, the Board's budget may
provide for the expenditure of revenues available to the Board
to develop international markets for, and to promote within such
markets, the consumption of dairy products produced or
manufactured in the United States.''.
[[Page 116 STAT. 209]]
(d) Importer Assessment.--Section 113(g) of the Dairy Production
Stabilization Act of 1983 (7 U.S.C. 4504(g)) is amended--
(1) by inserting ``Assessments.--'' after ``(g)'';
(2) by designating the first through fifth sentences as
paragraphs (1) through (5), respectively, and indenting
appropriately;
(3) in paragraph (3) (as so designated)--
(A) by inserting ``for milk produced in the United
States and imported dairy products'' after ``The rate of
assessment''; and
(B) by inserting before the period at the end the
following: ``, as determined by the Secretary''; and
(4) by adding at the end the following:
``(6) Importers.--
``(A) In general.--The order shall provide that each
importer of imported dairy products shall pay an
assessment to the Board in the manner prescribed by the
order.
``(B) Time for payment.--The assessment on imported
dairy products shall be paid by the importer to Customs
at the time the entry documents are filed with Customs.
Customs shall remit the assessments to the Board. For
purposes of this subparagraph, the term `importer'
includes persons who hold title to foreign-produced
dairy products immediately upon release by Customs, as
well as persons who act on behalf of others, as agents,
brokers, or consignees, to secure the release of dairy
products from Customs.
``(C) Use of assessments on imported dairy
products.--Assessments collected on imported dairy
products shall not be used for foreign market
promotion.''.
(e) Records.--Section 113(k) of the Dairy Production Stabilization
Act of 1983 (7 U.S.C. 4504(k)) is amended in the first sentence by
striking ``person receiving'' and inserting ``importer of imported dairy
products, each person receiving''.
(f) Importer Eligibility To Vote in Referendum.--Section 116(b) of
the Dairy Promotion Stabilization Act of 1983 (7 U.S.C. 4507(b)) is
amended--
(1) in the first sentence--
(A) by inserting after ``of producers'' the
following: ``and importers''; and
(B) by inserting after ``the producers'' the
following: ``and importers''; and
(2) in the second sentence, by inserting after ``commercial
use'' the following: ``and importers voting in the referendum
(who have been engaged in the importation of dairy products
during the same representative period, as determined by the
Secretary)''.
(g) Order Implementation and International Trade Obligations.--
Section 112 of the Dairy Promotion Stabilization Act of 1983 (7 U.S.C.
4503) is amended by adding at the end the following:
``(d) Order Implementation and International Trade Obligations.--The
Secretary, in consultation with the United States Trade Representative,
shall ensure that the order is implemented in a manner consistent with
the international trade obligations of the Federal Government.''.
[[Page 116 STAT. 210]]
(h) Conforming Amendments To Reflect Addition of Importers.--The
Dairy Production Stabilization Act of 1983 is amended--
(1) in section 110(b) (7 U.S.C. 4501(b))--
(A) in the first sentence--
(i) by inserting after ``commercial use'' the
following: ``and on imported dairy products''; and
(ii) by striking ``products produced in the
United States.'' and inserting ``products.''; and
(B) in the second sentence, by inserting after
``produce milk'' the following: ``or the right of any
person to import dairy products''; and
(2) in section 111(d) (7 U.S.C. 4502(d)), by striking
``produced in the United States''.
SEC. 1506. FLUID MILK PROMOTION.
(a) Definition of Fluid Milk Product.--Section 1999C of the Fluid
Milk Promotion Act of 1990 (7 U.S.C. 6402) is amended by striking
paragraph (3) and inserting the following:
``(3) Fluid milk product.--The term `fluid milk product' has
the meaning given the term in--
``(A) section 1000.15 of title 7, Code of Federal
Regulations, subject to such amendments as may be made
by the Secretary; or
``(B) any successor regulation.''.
(b) Definition of Fluid Milk Processor.--Section 1999C(4) of the
Fluid Milk Promotion Act of 1990 (7 U.S.C. 6402(4)) is amended by
striking ``500,000 pounds of fluid milk products in consumer-type
packages per month'' and inserting ``3,000,000 pounds of fluid milk
products in consumer-type packages per month (excluding products
delivered directly to the place of residence of a consumer)''.
(c) Elimination of Order Termination Date.--Section 1999O of the
Fluid Milk Promotion Act of 1990 (7 U.S.C. 6414) is amended--
(1) by striking subsection (a); and
(2) by redesignating subsections (b) and (c) as subsections
(a) and (b), respectively.
SEC. 1507. <<NOTE: 7 USC 7983.>> STUDY OF NATIONAL DAIRY POLICY.
(a) Study Required.--The Secretary of Agriculture shall conduct a
comprehensive economic evaluation of the potential direct and indirect
effects of the various elements of the national dairy policy, including
an examination of the effect of the national dairy policy on--
(1) farm price stability, farm profitability and viability,
and local rural economies in the United States;
(2) child, senior, and low-income nutrition programs,
including impacts on schools and institutions participating in
the programs, on program recipients, and other factors; and
(3) the wholesale and retail cost of fluid milk, dairy
farms, and milk utilization.
(b) Report.--Not <<NOTE: Deadline.>> later than 1 year after the
date of enactment of this Act, the Secretary shall submit to the
Committee on Agriculture of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the Senate a report
describing the results of the study required by this section.
[[Page 116 STAT. 211]]
(c) National Dairy Policy Defined.--In this section, the term
``national dairy policy'' means the dairy policy of the United States as
evidenced by the following policies and programs:
(1) 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 Act of 1937.
(2) Interstate dairy compacts (including proposed compacts
described in H.R. 1827 and S. 1157, as introduced in the 107th
Congress).
(3) Over-order premiums and State pricing programs.
(4) Direct payments to milk producers.
(5) Federal milk price support program established under
section 1401.
(6) Export programs regarding milk and dairy products, such
as the dairy export incentive program established under section
153 of the Food Security Act of 1985 (15 U.S.C. 713a-14).
SEC. 1508. <<NOTE: 7 USC 7984.>> STUDIES OF EFFECTS OF CHANGES IN
APPROACH TO NATIONAL DAIRY POLICY AND FLUID MILK IDENTITY
STANDARDS.
(a) Federal Dairy Policy Changes.--The Secretary of Agriculture
shall conduct a study of the effects of--
(1) terminating all Federal programs relating to price
support and supply management for milk; and
(2) granting the consent of Congress to cooperative efforts
by States to manage milk prices and supply.
(b) Fluid Milk Identity Standards.--The Secretary shall conduct a
study of the effects of including in the standard of identity for fluid
milk a required minimum protein content that is commensurate with the
average nonfat solids content of bovine milk produced in the United
States.
(c) Reports.--Not <<NOTE: Deadline.>> later than 1 year after the
date of enactment of this Act, the Secretary shall submit to the
Committee on Agriculture of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the Senate a report
describing the results of the studies required by this section.
Subtitle F--Administration
SEC. 1601. <<NOTE: 7 USC 7991.>> ADMINISTRATION GENERALLY.
(a) Use of Commodity Credit Corporation.--The Secretary shall use
the funds, facilities, and authorities of the Commodity Credit
Corporation to carry out this title.
(b) Determinations by Secretary.--A determination made by the
Secretary under this title shall be final and conclusive.
(c) Regulations.--
(1) In general.--Not <<NOTE: Deadline.>> later than 90 days
after the date of the enactment of this Act, the Secretary and
the Commodity Credit Corporation, as appropriate, shall
promulgate such regulations as are necessary to implement this
title.
(2) Procedure.--The <<NOTE: Regulations.>> promulgation of
the regulations and administration of this title shall be made
without regard to--
(A) chapter 35 of title 44, United States Code
(commonly know as the ``Paperwork Reduction Act'');
[[Page 116 STAT. 212]]
(B) the Statement of Policy 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
(C) the notice and comment provisions of section 553
of title 5, United States Code.
(3) Congressional review of agency rulemaking.--In carrying
out this subsection, the Secretary shall use the authority
provided under section 808 of title 5, United States Code.
(d) Treatment of Advance Payment Option.--The protection that was
afforded producers that had an option to elect to accelerate the receipt
of any payment under a production flexibility contract payable under the
Federal Agriculture Improvement and Reform Act of 1996, as provided by
section 525 of Public 106-170 (113 Stat. 1928; 7 U.S.C. 7212 note),
shall also apply to the option to receive--
(1) the advance payment of direct payments and counter-
cyclical payments under subtitle A and subtitle C; and
(2) the single payment of compensation for eligible peanut
quota holders under section 1310.
(e) Adjustment Authority Related to Uruguay Round Compliance.--
(1) Required determination; adjustment.--If the Secretary
determines that expenditures under subtitles A through E that
are subject to the total allowable domestic support levels under
the Uruguay Round Agreements (as defined in section 2 of the
Uruguay Round Agreements Act (19 U.S.C. 3501)), as in effect on
the date of enactment of this Act, will exceed such allowable
levels for any applicable reporting period, the Secretary shall,
to the maximum extent practicable, make adjustments in the
amount of such expenditures during that period to ensure that
such expenditures do not exceed such allowable levels.
(2) Congressional notification.--Before making any
adjustment under paragraph (1), the Secretary shall submit to
the Committee on Agriculture, Nutrition, and Forestry of the
Senate and the Committee on Agriculture of the House of
Representatives a report describing the determination made under
that paragraph and the extent of the adjustment to be made.
SEC. 1602. <<NOTE: 7 USC 7992.>> SUSPENSION OF PERMANENT PRICE SUPPORT
AUTHORITY.
(a) Agricultural Adjustment Act of 1938.--The following provisions
of the Agricultural Adjustment Act of 1938 shall not be applicable to
the 2002 through 2007 crops of covered commodities, peanuts, and sugar
and shall not be applicable to milk during the period beginning on the
date of enactment of this Act through December 31, 2007:
(1) Parts II through V of subtitle B of title III (7 U.S.C.
1326-1351).
(2) In the case of upland cotton, section 377 (7 U.S.C.
1377).
(3) Subtitle D of title III (7 U.S.C. 1379a-1379j).
(4) Title IV (7 U.S.C. 1401-1407).
(b) Agricultural Act of 1949.--The following provisions of the
Agricultural Act of 1949 shall not be applicable to the 2002
[[Page 116 STAT. 213]]
through 2007 crops of covered commodities, peanuts, and sugar and shall
not be applicable to milk during the period beginning on the date of
enactment of this Act and through December 31, 2007:
(1) Section 101 (7 U.S.C. 1441).
(2) Section 103(a) (7 U.S.C. 1444(a)).
(3) Section 105 (7 U.S.C. 1444b).
(4) Section 107 (7 U.S.C. 1445a).
(5) Section 110 (7 U.S.C. 1445e).
(6) Section 112 (7 U.S.C. 1445g).
(7) Section 115 (7 U.S.C. 1445k).
(8) Section 201 (7 U.S.C. 1446).
(9) Title III (7 U.S.C. 1447-1449).
(10) Title IV (7 U.S.C. 1421-1433d), other than sections
404, 412, and 416 (7 U.S.C. 1424, 1429, and 1431).
(11) Title V (7 U.S.C. 1461-1469).
(12) Title VI (7 U.S.C. 1471-1471j).
(c) Suspension of Certain Quota Provisions.--The joint resolution
entitled ``A joint resolution relating to corn and wheat marketing
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 2002
through 2007.
(d) Conforming Amendment.--Section 171(a)(1) of the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7301(a)(1)) is
amended by striking ``2002'' the first place appears and inserting
``2001''.
SEC. 1603. PAYMENT LIMITATIONS.
(a) Limitation on Amounts Received.--Section 1001 of the Food
Security Act of 1985 (7 U.S.C. 1308) is amended by striking the section
heading, ``Sec. 1001.'', and all that follows through the end of
paragraph (4) and inserting the following:
``SEC. 1001. PAYMENT LIMITATIONS.
``(a) Definitions.--In this section:
``(1) Covered commodity.--The term `covered commodity' has
the meaning given that term in section 1001 of the Farm Security
and Rural Investment Act of 2002.
``(2) Loan commodity.--The term `loan commodity' has the
meaning given that term in section 1001 of the Farm Security and
Rural Investment Act of 2002, except that the term does not
include wool, mohair, or honey.
``(3) Secretary.--The term `Secretary' means the Secretary
of Agriculture.
``(b) Limitation on Direct Payments.--
``(1) Covered commodities.--The total amount of direct
payments made to a person during any crop year under subtitle A
of title I of the Farm Security and Rural Investment Act of 2002
for 1 or more covered commodities may not exceed $40,000.
``(2) Peanuts.--The total amount of direct payments made to
a person during any crop year under subtitle C of title I of the
Farm Security and Rural Investment Act of 2002 may not exceed
$40,000.
``(c) Limitation on Counter-Cyclical Payments.--
``(1) Covered commodities.--The total amount of counter-
cyclical payments made to a person during any crop year under
[[Page 116 STAT. 214]]
subtitle A of title I of the Farm Security and Rural Investment
Act of 2002 for 1 or more covered commodities may not exceed
$65,000.
``(2) Peanuts.--The total amount of counter-cyclical
payments made to a person during any crop year under subtitle C
of title I of the Farm Security and Rural Investment Act of 2002
may not exceed $65,000.
``(d) Limitation on Marketing Loan Gains and Loan Deficiency
Payments.--
``(1) Loan commodities.--The total amount of the following
gains and payments that a person may receive during any crop
year may not exceed $75,000:
``(A) Any gain realized by a producer from repaying
a marketing assistance loan for 1 or more loan
commodities under subtitle B of title I of the Farm
Security and Rural Investment Act of 2002 at a lower
level than the original loan rate established for the
loan commodity under that subtitle.
``(B) Any loan deficiency payments received for 1 or
more loan commodities under that subtitle.
``(2) Other commodities.--The total amount of the following
gains and payments that a person may receive during any crop
year may not exceed $75,000:
``(A) Any gain realized by a producer from repaying
a marketing assistance loan for peanuts, wool, mohair,
or honey under subtitle B or C of title I of the Farm
Security and Rural Investment Act of 2002 at a lower
level than the original loan rate established for the
commodity under those subtitles.
``(B) Any loan deficiency payments received for
peanuts, wool, mohair, and honey under those
subtitles.''.
(b) Clerical and Conforming Amendments to Section 1001.--Section
1001 of the Food Security Act of 1985 (7 U.S.C. 1308) is amended--
(1) in paragraph (5)--
(A) by striking ``(5)'' and inserting ``(e)
Definition of Person.--''
(B) by redesignating subparagraphs (A) through (E)
as paragraphs (1) through (5), respectively;
(C) in paragraph (1), as so redesignated--
(i) by redesignating clauses (i) and (ii) as
subparagraphs (A) and (B), respectively; and
(ii) by striking the second sentence; and
(D) in paragraph (2), as so redesignated--
(i) by redesignating clause (i) as
subparagraph (A) and, in such subparagraph (as so
redesignated)--
(I) by striking ``subparagraph (A),
subject to clause (ii)'' and inserting
``paragraph (1), subject to subparagraph
(B)''; and
(II) by redesignating subclauses
(I), (II), and (III), as clauses (i),
(ii), and (iii), respectively;
(ii) by redesignating clause (ii) as
subparagraph (B) and, in such subparagraph (as so
redesignated), by redesignating subclauses (I),
(II), and (III), as clauses (i), (ii), and (iii),
respectively; and
(iii) by redesignating clause (iii) as
subparagraph (C) and, in such subparagraph (as so
redesignated)--
[[Page 116 STAT. 215]]
(I) by striking ``as described in
paragraphs (1) and (2)'' and inserting
``as described in subsections (b), (c),
and (d)''; and
(II) by redesignating subclauses (I)
and (II) as clauses (i) and (ii),
respectively;
(2) in paragraph (6), by striking ``(6)'' and inserting
``(f) Public Schools.--''; and
(3) in paragraph (7), by striking ``(7)'' and inserting
``(g) Time Limits; Reliance.--''.
(c) Conforming Amendments to Other laws.--
(1) Section 1001A of the Food Security Act of 1985 (7 U.S.C.
1308-1) is amended--
(A) in subsections (a)(1) and (b)(2)(B), by striking
``section 1001(5)(B)(i)(II)'' and inserting ``section
1001(e)(2)(A)(ii)''; and
(B) in subsections (a)(1) and (b)(1), by striking
``section 1001(5)(B)(i)'' and inserting ``section
1001(e)(2)(A)''; and
(2) Section 1001B of the Food Security Act of 1985 (7 U.S.C.
1308-2) is amended by striking ``as described in paragraphs (1)
and (2)'' and inserting ``as described in subsections (b), (c),
and (d)''.
(3) Section 1001C(a) of the Food Security Act of 1985 (7
U.S.C. 1308-3(a)) is amended by inserting ``title I of the Farm
Security and Rural Investment Act of 2002,'' after ``made
available under''.
(d) Transition.--Section 1001 of the Food Security Act of 1985 (7
U.S.C. 1308), as in effect on the day before the date of the enactment
of this Act, shall continue to apply with respect to the 2001 crop of
any covered commodity.
SEC. 1604. ADJUSTED GROSS INCOME LIMITATION.
The Food Security Act of 1985 is amended--
(1) by redesignating section 1001D (7 U.S.C. 1308-4) and
section 1001E (7 U.S.C. 1308-5) as sections 1001E and 1001F,
respectively; and
(2) by inserting after section 1001C (7 U.S.C. 1308-3) the
following:
``SEC. 1001D. <<NOTE: 7 USC 1308-3a.>> ADJUSTED GROSS INCOME
LIMITATION.
``(a) Definition of Average Adjusted Gross Income.--
``(1) In general.--In this section, the term `average
adjusted gross income', with respect to an individual or entity
(for purposes of this section, as defined in section
1001(e)(2)(A)(ii)), means the 3-year average of the adjusted
gross income or comparable measure of the individual or entity
over the 3 preceding tax years, as determined by the Secretary.
``(2) Special rules for certain individuals and entities.--
In the case of an entity that is not required to file a Federal
income tax return or an individual or entity that did not have
taxable income in 1 or more of the tax years used to determine
the average under paragraph (1), the Secretary shall provide, by
regulation, a method for determining the average adjusted gross
income of the individual or entity for purposes of this section.
``(b) Limitation.--
``(1) In general.--Notwithstanding any other provision of
law, an individual or entity shall not be eligible to receive
any benefit described in paragraph (2) during a crop year
[[Page 116 STAT. 216]]
if the average adjusted gross income of the individual or entity
exceeds $2,500,000, unless not less than 75 percent of the
average adjusted gross income of the individual or entity is
derived from farming, ranching, or forestry operations, as
determined by the Secretary.
``(2) Covered benefits.--Paragraph (1) applies with respect
to the following:
``(A) A direct payment or counter-cyclical payment
under subtitle A or C of title I of the Farm Security
and Rural Investment Act of 2002.
``(B) A marketing loan gain or payment described in
section 1001(d) of this Act.
``(C) A payment under any program under title XII of
this Act or title II of the Farm Security and Rural
Investment Act of 2002.
``(c) Certification.--To comply with the limitation under subsection
(b), an individual or entity shall provide to the Secretary--
``(1) a certification by a certified public accountant or
another third party that is acceptable to the Secretary that the
average adjusted gross income of the individual or entity does
not exceed the limitation specified in that subsection; or
``(2) information and documentation regarding the adjusted
gross income of the individual or entity through other
procedures established by the Secretary.
``(d) Commensurate Reduction.--In the case of a benefit described in
subsection (b)(2) made in a crop year to an entity, general partnership,
or joint venture, the amount of the benefit shall be reduced by an
amount that is commensurate with the direct and indirect ownership
interest in the entity, general partnership, or joint venture of each
individual who has an average adjusted gross income in excess of the
limitation specified in subsection (b) for the average of the 3
preceding crop years.
``(e) Effective Period.--This section shall apply only during the
2003 through 2007 crop years.''.
SEC. 1605. <<NOTE: 7 USC 7993.>> COMMISSION ON APPLICATION OF PAYMENT
LIMITATIONS.
(a) Establishment.--There is established a commission to be known as
the ``Commission on the Application of Payment Limitations for
Agriculture'' (referred to in this section as the ``Commission'').
(b) Duties.--The Commission shall conduct a study on the potential
impacts of further payment limitations on the receipt of direct
payments, counter-cyclical payments, and marketing loan gains and loan
deficiency payments on--
(1) farm income;
(2) land values;
(3) rural communities;
(4) agribusiness infrastructure;
(5) planting decisions of producers affected; and
(6) supply and prices of covered commodities, loan
commodities, specialty crops (including fruits and vegetables),
and other agricultural commodities.
(c) Membership.--
(1) Composition.--The Commission shall be composed of 10
members as follows:
(A) 3 members appointed by the Secretary.
[[Page 116 STAT. 217]]
(B) 3 members appointed by the Committee on
Agriculture, Nutrition, and Forestry of the Senate.
(C) 3 members appointed by the Committee on
Agriculture of the House of Representatives.
(D) The Chief Economist of the Department of
Agriculture.
(2) Federal government employment.--The membership of the
Commission may include 1 or more employees of the Department of
Agriculture or other Federal agencies.
(3) Date of appointments.--
The <<NOTE: Deadline.>> appointment of a member of the
Commission shall be made not later than 60 days after the date
of enactment of this Act.
(4) Term; vacancies.--
(A) Term.--A member shall be appointed for the life
of the Commission.
(B) Vacancies.--A vacancy on the Commission--
(i) shall not affect the powers of the
Commission; and
(ii) shall be filled in the same manner as the
original appointment was made.
(5) Initial meeting.--Not <<NOTE: Deadline.>> later than 30
days after the date on which all members of the Commission have
been appointed, the Commission shall hold the initial meeting of
the Commission.
(d) Quorum.--A majority of the members of the Commission shall
constitute a quorum for the transaction of business, but a lesser number
of members may hold hearings.
(e) Chairperson.--The Secretary shall appoint 1 of the members of
the Commission to serve as Chairperson of the Commission.
(f) Report.--Not <<NOTE: Deadline.>> later than 1 year after the
date of enactment of this Act, 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 study required by subsection (b),
including such recommendations as the Commission considers appropriate.
(g) Hearings.--The Commission may hold such hearings, meet and act
at such times and places, take such testimony, and receive such evidence
as the Commission considers advisable to carry out this section.
(h) Information From Federal Agencies.--The Commission may secure
directly from a Federal agency such information as the Commission
considers necessary to carry out this section. On request of the
Chairperson of the Commission, the head of the agency shall provide the
information to the Commission.
(i) Postal Services.--The Commission may use the United States mails
in the same manner and under the same conditions as other agencies of
the Federal Government.
(j) Assistance From Secretary.--The Secretary may provide to the
Commission appropriate office space and such reasonable administrative
and support services as the Commission may request.
(k) Compensation of Members.--
(1) Non-federal employees.--A member of the Commission who
is not an officer or employee of the Federal Government shall be
compensated at a rate equal to the daily equivalent of the
annual rate of basic pay prescribed for level IV
[[Page 116 STAT. 218]]
of the Executive Schedule under section 5315 of title 5, United
States Code, for each day (including travel time) during which
the member is engaged in the performance of the duties of the
Commission.
(2) Federal employees.--A member of the Commission who is an
officer or employee of the Federal Government shall serve
without compensation in addition to the compensation received
for the services of the member as an officer or employee of the
Federal Government.
(3) Travel Expenses.--A member of the Commission shall be
allowed travel expenses, including per diem in lieu of
subsistence, at rates authorized for an employee of an agency
under subchapter I of chapter 57 of title 5, United States Code,
while away from the home or regular place of business of the
member in the performance of the duties of the Commission.
(l) Federal Advisory Committee Act.--The Federal Advisory Committee
Act (5 U.S.C. App.) shall not apply to the Commission or any proceeding
of the Commission.
SEC. 1606. ADJUSTMENTS OF LOANS.
Section 162(b) of the Federal Agriculture Improvement and Reform Act
of 1996 (7 U.S.C. 7282(b)) is amended by striking ``this title'' and
inserting ``this title and title I of the Farm Security and Rural
Investment Act of 2002''.
SEC. 1607. PERSONAL LIABILITY OF PRODUCERS FOR DEFICIENCIES.
Section 164 of the Federal Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7284) is amended by striking ``this title'' each places
it appears and inserting ``this title and title I of the Farm Security
and Rural Investment Act of 2002''.
SEC. 1608. EXTENSION OF EXISTING ADMINISTRATIVE AUTHORITY REGARDING
LOANS.
Section 166 of the Federal Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7286) is amended--
(1) in subsection (a), by striking ``subtitle C'' and
inserting ``subtitle C of this title and subtitle B and C of
title I of the Farm Security and Rural Investment Act of 2002'';
and
(2) in subsection (c)(1), by striking ``subtitle C'' and
inserting ``subtitle C of this title and subtitle B and C of
title I of the Farm Security and Rural Investment Act of 2002''.
SEC. 1609. COMMODITY CREDIT CORPORATION INVENTORY.
Section 5 of the Commodity Credit Corporation Charter Act (15 U.S.C.
714c) is amended in the last sentence by inserting before the period at
the end the following: ``(including, at the option of the Corporation,
the use of private sector entities)''.
SEC. 1610. RESERVE STOCK LEVEL.
Section 301(b)(14)(C) of the Agricultural Adjustment Act of 1938 (7
U.S.C. 1301(b)(14)(C)) is amended--
(1) in clause (i), by striking ``100,000,000'' and inserting
``60,000,000''; and
(2) in clause (ii), by striking ``15 percent'' and inserting
``10 percent''.
SEC. 1611. FARM RECONSTITUTIONS.
(a) In General.--Section 316(a)(1)(A)(ii) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1314b(a)(1)(A)(ii)) is amended
[[Page 116 STAT. 219]]
by adding at the end the following: ``Notwithstanding any other
provision of law, for the 2002 crop only, the Secretary shall allow
special farm reconstitutions, in lieu of lease and transfer of
allotments and quotas, under this section, in accordance with such
conditions as are established by the Secretary.''.
(b) <<NOTE: 7 USC 7994.>> Study.--
(1) In general.--The Secretary shall conduct a study on the
effects on the limitation on producers to move quota to a farm
other than the farm to which the quota was initially assigned
under part I of subtitle B of title III of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1311 et seq.).
(2) Report.--Not <<NOTE: Deadline.>> later than 90 days
after the date of enactment of this Act, the Secretary shall
submit to the Committee on Agriculture of the House of
Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate a report on the results of the study.
SEC. 1612. <<NOTE: 7 USC 7995.>> ASSIGNMENT OF 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 payments made under the authority of this Act. The
producer making the assignment, or the assignee, shall provide the
Secretary with notice, in such manner as the Secretary may require, of
any assignment made under this section.
SEC. 1613. <<NOTE: 7 USC 7996.>> EQUITABLE RELIEF FROM INELIGIBILITY FOR
LOANS, PAYMENTS, OR OTHER BENEFITS.
(a) Definitions.--In this section:
(1) Agricultural commodity.--The term ``agricultural
commodity'' means any agricultural commodity, food, feed, fiber,
or livestock that is subject to a covered program.
(2) Covered program.--
(A) In general.--The term ``covered program''
means--
(i) a program administered by the Secretary
under which price or income support, or production
or market loss assistance, is provided to
producers of agricultural commodities; and
(ii) a conservation program administered by
the Secretary.
(B) Exclusions.--The term ``covered program'' does
not include--
(i) an agricultural credit program carried out
under the Consolidated Farm and Rural Development
Act (7 U.S.C. 1921 et seq.); or
(ii) the crop insurance program carried out
under the Federal Crop Insurance Act (7 U.S.C.
1501 et seq.).
(3) Participant.--The term ``participant'' means a
participant in a covered program.
(4) State conservationist.--The term ``State
Conservationist'' means the State Conservationist with respect
to a program administered by the Natural Resources Conservation
Service.
(5) State director.--The term ``State Director'' means the
State Executive Director of the Farm Service Agency with respect
to a program administered by the Farm Service Agency.
(b) Equitable Relief.--The Secretary may provide relief to any
participant that is determined to be not in compliance with the
requirements of a covered program, and therefore ineligible
[[Page 116 STAT. 220]]
for a loan, payment, or other benefit under the covered program, if the
participant--
(1) acting in good faith, relied on the action or advice of
the Secretary (including any authorized representative of the
Secretary) to the detriment of the participant; or
(2) failed to comply fully with the requirements of the
covered program, but made a good faith effort to comply with the
requirements.
(c) Forms of Relief.--The Secretary may authorize a participant in a
covered program to--
(1) retain loans, payments, or other benefits received under
the covered program;
(2) continue to receive loans, payments, and other benefits
under the covered program;
(3) continue to participate, in whole or in part, under any
contract executed under the covered program;
(4) in the case of a conservation program, reenroll all or
part of the land covered by the program; and
(5) receive such other equitable relief as the Secretary
determines to be appropriate.
(d) Remedial Action.--As a condition of receiving relief under this
section, the Secretary may require the participant to take actions
designed to remedy any failure to comply with the covered program.
(e) Equitable Relief by State Directors and State
Conservationists.--
(1) In general.--A State Director, in the case of programs
administered by the State Director, and the State
Conservationist, in the case of programs administered by the
State Conservationist, may grant relief to a participant in
accordance with subsections (b) through (d) if--
(A) the amount of loans, payments, and benefits for
which relief will be provided to the participant under
this subsection is less than $20,000;
(B) the total amount of loans, payments, and
benefits for which relief has been previously provided
to the participant under this subsection is not more
than $5,000; and
(C) the total amount of loans, payments, and
benefits for which relief is provided to similarly
situated participants under this subsection is not more
than $1,000,000, as determined by the Secretary.
(2) Consultation, approval, and reversal.--The decision by a
State Director or State Conservationist to grant relief under
this subsection--
(A) shall not require prior approval by the
Administrator of the Farm Service Agency, the Chief of
the Natural Resources Conservation Service, or any other
officer or employee of the Agency or Service;
(B) shall be made only after consultation with, and
the approval of, the Office of General Counsel of the
Department of Agriculture; and
(C) is subject to reversal only by the Secretary
(who may not delegate the reversal authority).
(3) Nonapplicability.--The authority of a State Director or
State Conservationist under this subsection does not apply to
the administration of--
(A) payment limitations under--
[[Page 116 STAT. 221]]
(i) sections 1001 through 1001F of the Food
Security Act of 1985 (7 U.S.C. 1308 et seq.); or
(ii) a conservation program administered by
the Secretary.
(B) highly erodible land and wetland conservation
requirements under subtitle B or C of title XII of the
Food Security Act of 1985 (16 U.S.C. 3811 et seq.).
(4) Other authority.--The authority provided to a State
Director and State Conservationist under this subsection is in
addition to any other applicable authority and does not limit
other authority provided by law or the Secretary.
(f) Judicial Review.--A discretionary decision by the Secretary, the
State Director, or the State Conservationist under this section shall be
final, and shall not be subject to review under chapter 7 of title 5,
United States Code.
(g) Reports.--Not <<NOTE: Deadline.>> later than February 1 of each
year, the Secretary shall submit to the Committee on Agriculture of the
House of Representatives and the Committee on Agriculture, Nutrition,
and Forestry of the Senate a report that describes for the previous
calendar year--
(1) the number of requests for equitable relief under
subsections (b) and (e) and the disposition of the requests; and
(2) the number of requests for equitable relief under
section 278(d) of the Department of Agriculture Reorganization
Act of 1994 (7 U.S.C. 6998(d)) and the disposition of the
requests.
(h) Relationship to Other Law.--The authority provided in this
section is in addition to any other authority provided in this or any
other Act.
(i) Finality Rule.--Section 281(a) of the Department of Agriculture
Reorganization Act of 1994 (7 U.S.C. 7001(a)) is amended--
(1) by striking ``Consolidated Farm Service Agency'' each
place it appears and inserting ``Farm Service Agency'';
(2) in paragraph (1)--
(A) by striking ``This subsection'' and inserting
the following:
``(A) In general.--Except as provided in
subparagraph (B), this subsection''; and
(B) by adding at the end the following:
``(B) Nonapplicability.--This subsection does not
apply to--
``(i) a function performed under section 376
of the Consolidated Farm and Rural Development
Act; or
``(ii) a function performed under a
conservation program administered by the Natural
Resources Conservation Service.''; and
(3) in paragraph (2), by inserting ``, before the end of the
90-day period,'' after ``unless the decision''.
(j) Conforming Amendments.--
(1) Section 326 of the Food and Agriculture Act of 1962 (7
U.S.C. 1339a) is repealed.
(2) Section 278(d) of the Department of Agriculture
Reorganization Act of 1994 (7 U.S.C. 6998(d)) is amended in the
first sentence by striking ``section 326 of the Food and
Agriculture Act of 1962 (7 U.S.C. 1339a)'' and inserting
``section 1613 of the Farm Security and Rural Investment Act of
2002''.
(3) Section 1230A of the Food Security Act of 1985 (16
U.S.C. 3830a) is repealed.
[[Page 116 STAT. 222]]
SEC. 1614. <<NOTE: 7 USC 7997.>> TRACKING OF BENEFITS.
As soon as practicable after the date of enactment of this Act, the
Secretary shall establish procedures to track the benefits provided,
directly or indirectly, to individuals and entities under titles I and
II and the amendments made by those titles.
SEC. 1615. <<NOTE: 7 USC 7998.>> ESTIMATES OF NET FARM INCOME.
In each issuance of projections of net farm income, the Secretary
shall include (as determined by the Secretary)--
(1) an estimate of the net farm income earned by commercial
producers in the United States; and
(2) an estimate of the net farm income attributable to
commercial producers of each of the following:
(A) Livestock.
(B) Loan commodities.
(C) Agricultural commodities other than loan
commodities.
SEC. 1616. <<NOTE: 7 USC 7999.>> AVAILABILITY OF INCENTIVE PAYMENTS FOR
CERTAIN PRODUCERS.
(a) Incentive Payments Required.--Subject to subsection (b), the
Secretary shall make available a total of $20,000,000 of funds of the
Commodity Credit Corporation during the 2003 through 2005 crop years to
provide incentive payments to producers of hard white wheat.
(b) Conditions on Implementation.--The Secretary shall implement
subsection (a)--
(1) only with regard to production that meets minimum
quality criteria; and
(2) on not more than 2,000,000 acres or the equivalent
volume of production.
(c) Demand for Wheat.--To be eligible to obtain an incentive payment
under subsection (a), a producer shall demonstrate to the satisfaction
of the Secretary that buyers and end-users are available for the wheat
to be covered by the incentive payment.
SEC. 1617. <<NOTE: 7 USC 8000.>> RENEWED AVAILABILITY OF MARKET LOSS
ASSISTANCE AND CERTAIN EMERGENCY ASSISTANCE TO PERSONS THAT
FAILED TO RECEIVE ASSISTANCE UNDER EARLIER AUTHORITIES.
(a) Authority to Provide Assistance.--The Secretary of Agriculture
may use such funds of the Commodity Credit Corporation as are necessary
to provide market loss assistance and other emergency assistance under a
provision of law specified in subsection (c) to persons that, as
determined by the Secretary)--
(1) were eligible to receive the assistance under the
provision of law; but
(2) did not receive the assistance before October 1, 2001.
(b) Limitation.--The amount of assistance provided under a provision
of law specified in subsection (c) and this section to a person shall
not exceed the amount of assistance the person would have been eligible
to receive under the provision had the claim of the producer under the
provision been timely resolved.
(c) Covered Market Loss Assistance Authorities.--The following
provisions of law are covered by this section:
(1) Sections 1, 2, 3, 4, and 5 of Public Law 107-25 (115
Stat. 201).
[[Page 116 STAT. 223]]
(2) Sections 805, 806, and 814 of the Agriculture, Rural
Development, Food and Drug Administration, and Related Agencies
Appropriations Act, 2001 (as enacted into law by Public Law 106-
387; 114 Stat. 1549).
(3) Sections 201, 202, 204(a), 204(d), 257, and 259 of the
Agricultural Risk Protection Act of 2000 (Public Law 106-224; 7
U.S.C. 1421 note).
(4) Sections 802, 803(a), 804, and 805 of the Agriculture,
Rural Development, Food and Drug Administration, and Related
Agencies Appropriations Act, 2000 (Public Law 106-78; 113 Stat.
1135).
(5) The livestock indemnity program under the heading
``Commodity Credit Corporation Fund'' in chapter 1 of title I of
the 1999 Emergency Supplemental Appropriations Act (Public 106-
31; 113 Stat. 59).
(6) Section 1111(a) of the Agriculture, Rural Development,
Food and Drug Administration, and Related Agencies
Appropriations Act, 1999 (as contained in section 101(a) of
division A of Public Law 105-277; 112 Stat. 2681-44).
SEC. 1618. <<NOTE: 7 USC 8001.>> PRODUCER RETENTION OF ERRONEOUSLY PAID
LOAN DEFICIENCY PAYMENTS AND MARKETING LOAN GAINS.
Notwithstanding any other provision of law, the Secretary and the
Commodity Credit Corporation shall not require producers in Erie County,
Pennsylvania, to repay loan deficiency payments and marketing loan gains
erroneously paid or determined to have been earned by the Commodity
Credit Corporation for certain 1998 and 1999 crops under subtitle C of
title I of the Federal Agriculture Improvement and Reform Act of 1996 (7
U.S.C. 7231 et seq.). In the case of a producer who has already made the
repayment on or before the date of the enactment of this Act, the
Commodity Credit Corporation shall reimburse the producer for the full
amount of the repayment.
TITLE II--CONSERVATION
Subtitle A--Conservation Security
SEC. 2001. CONSERVATION SECURITY PROGRAM.
(a) In General.--Subtitle D of title XII of the Food Security Act of
1985 (16 U.S.C. 3830 et seq.) is amended by inserting after chapter 1
the following:
``CHAPTER 2--CONSERVATION SECURITY AND FARMLAND PROTECTION
``Subchapter A--Conservation Security Program
``SEC. 1238. <<NOTE: 16 USC 3838.>> DEFINITIONS.
``In this subchapter:
``(1) Base payment.--The term `base payment' means an amount
that is--
``(A) determined in accordance with the rate
described in section 1238C(b)(1)(A); and
[[Page 116 STAT. 224]]
``(B) paid to a producer under a conservation
security contract in accordance with clause (i) of
subparagraph (C), (D), or (E) of section 1238C(b)(1), as
appropriate.
``(2) Beginning farmer or rancher.--The term `beginning
farmer or rancher' has the meaning given the term under section
343(a) of the Consolidated Farm and Rural Development Act (7
U.S.C. 1991(a)).
``(3) Conservation practice.--The term `conservation
practice' means a conservation farming practice described in
section 1238A(d)(4) that--
``(A) requires planning, implementation, management,
and maintenance; and
``(B) promotes 1 or more of the purposes described
in section 1238A(a).
``(4) Conservation security contract.--The term
`conservation security contract' means a contract described in
section 1238A(e).
``(5) Conservation security plan.--The term `conservation
security plan' means a plan described in section 1238A(c).
``(6) Conservation security program.--The term `conservation
security program' means the program established under section
1238A(a).
``(7) Enhanced payment.--The term `enhanced payment' means
the amount paid to a producer under a conservation security
contract that is equal to the amount described in section
1238C(b)(1)(C)(iii).
``(8) Nondegradation standard.--The term `nondegradation
standard' means the level of measures required to adequately
protect, and prevent degradation of, 1 or more natural
resources, as determined by the Secretary in accordance with the
quality criteria described in handbooks of the Natural Resources
Conservation Service.
``(9) Producer.--
``(A) In general.--The term `producer' means an
owner, operator, landlord, tenant, or sharecropper
that--
``(i) shares in the risk of producing any crop
or livestock; and
``(ii) is entitled to share in the crop or
livestock available for marketing from a farm (or
would have shared had the crop or livestock been
produced).
``(B) Hybrid seed growers.--In determining whether a
grower of hybrid seed is a producer, the Secretary shall
not take into consideration the existence of a hybrid
seed contract.
``(10) Resource-conserving crop rotation.--The term
`resource-conserving crop rotation' means a crop rotation that--
``(A) includes at least 1 resource-conserving crop
(as defined by the Secretary);
``(B) reduces erosion;
``(C) improves soil fertility and tilth;
``(D) interrupts pest cycles; and
``(E) in applicable areas, reduces depletion of soil
moisture (or otherwise reduces the need for irrigation).
``(11) Resource management system.--The term `resource
management system' means a system of conservation practices and
management relating to land or water use that is designed to
prevent resource degradation and permit sustained use of
[[Page 116 STAT. 225]]
land, water, and other natural resources, as defined in
accordance with the technical guide of the Natural Resources
Conservation Service.
``(12) Secretary.--The term `Secretary' means the Secretary
of Agriculture, acting through the Chief of the Natural
Resources Conservation Service.
``(13) Tier i conservation security contract.--The term
`Tier I conservation security contract' means a contract
described in section 1238A(d)(5)(A).
``(14) Tier ii conservation security contract.--The term
`Tier II conservation security contract' means a contract
described in section 1238A(d)(5)(B).
``(15) Tier iii conservation security contract.--The term
`Tier III conservation security contract' means a contract
described in section 1238A(d)(5)(C).
``SEC. 1238A. <<NOTE: 16 USC 3838a.>> CONSERVATION SECURITY PROGRAM.
``(a) In General.--The Secretary shall establish and, for each of
fiscal years 2003 through 2007, carry out a conservation security
program to assist producers of agricultural operations in promoting, as
is applicable with respect to land to be enrolled in the program,
conservation and improvement of the quality of soil, water, air, energy,
plant and animal life, and any other conservation purposes, as
determined by the Secretary.
``(b) Eligibility.--
``(1) Eligible producers.--To be eligible to participate in
the conservation security program (other than to receive
technical assistance under section 1238C(g) for the development
of conservation security contracts), a producer shall--
``(A) develop and submit to the Secretary, and
obtain the approval of the Secretary of, a conservation
security plan that meets the requirements of subsection
(c)(1); and
``(B) enter into a conservation security contract
with the Secretary to carry out the conservation
security plan.
``(2) Eligible land.--Except as provided in paragraph (3),
private agricultural land (including cropland, grassland,
prairie land, improved pasture land, and rangeland), land under
the jurisdiction of an Indian tribe (as defined by the
Secretary), and forested land that is an incidental part of an
agricultural operation shall be eligible for enrollment in the
conservation security program.
``(3) Exclusions.--
``(A) Conservation reserve program.--Land enrolled
in the conservation reserve program under subchapter B
of chapter 1 shall not be eligible for enrollment in the
conservation security program.
``(B) Wetlands reserve program.--Land enrolled in
the wetlands reserve program established under
subchapter C of chapter 1 shall not be eligible for
enrollment in the conservation security program.
``(C) Grassland reserve program.--Land enrolled in
the grassland reserve program established under
subchapter C of chapter 2 shall not be eligible for
enrollment in the conservation security program.
``(D) Conversion to cropland.--Land that is used for
crop production after the date of enactment of this
subchapter that had not been planted, considered to be
[[Page 116 STAT. 226]]
planted, or devoted to crop production for at least 4 of
the 6 years preceding that date (except for land
enrolled in the conservation reserve program under
subchapter B of chapter 1) or that has been maintained
using long-term crop rotation practices, as determined
by the Secretary, shall not be the basis for any payment
under the conservation security program.
``(4) Economic uses.--The Secretary shall permit a producer
to implement, with respect to all eligible land covered by a
conservation security plan, economic uses that--
``(A) maintain the agricultural nature of the land;
and
``(B) are consistent with the natural resource and
conservation objectives of the conservation security
program.
``(c) Conservation Security Plans.--
``(1) In general.--A conservation security plan shall--
``(A) identify the designated land and resources to
be conserved under the conservation security plan;
``(B) describe the tier of conservation security
contract, and the particular conservation practices to
be implemented, maintained, or improved, in accordance
with subsection (d) on the land covered by the
conservation security contract for the specified term;
and
``(C) contain a schedule for the implementation,
maintenance, or improvement of the conservation
practices described in the conservation security plan
during the term of the conservation security contract.
``(2) Resource planning.--The Secretary may assist producers
that enter into conservation security contracts in developing a
comprehensive, long-term strategy for improving and maintaining
all natural resources of the agricultural operation of the
producer.
``(d) Conservation Contracts and Practices.--
``(1) In general.--
``(A) Establishment of tiers.--The Secretary shall
establish, and offer to eligible producers, 3 tiers of
conservation contracts under which a payment under this
subchapter may be received.
``(B) Eligible conservation practices.--
``(i) In general.--The Secretary shall make
eligible for payment under a conservation security
contract land management, vegetative, and
structural practices.
``(ii) Determination.--In determining the
eligibility of a practice described in clause (i),
the Secretary shall require, to the maximum extent
practicable, that the lowest cost alternatives be
used to fulfill the purposes of the conservation
security plan, as determined by the Secretary.
``(2) On-farm research and demonstration or pilot testing.--
With respect to land enrolled in the conservation security
program, the Secretary may approve a conservation security plan
that includes--
``(A) on-farm conservation research and
demonstration activities; and
``(B) pilot testing of new technologies or
innovative conservation practices.
[[Page 116 STAT. 227]]
``(3) Use of handbook and guides; state and local
conservation concerns.--
``(A) Use of handbook and guides.--In determining
eligible conservation practices and the criteria for
implementing or maintaining the conservation practices
under the conservation security program, the Secretary
shall use the National Handbook of Conservation
Practices of the Natural Resources Conservation Service.
``(B) State and local conservation priorities.--The
conservation priorities of a State or locality in which
an agricultural operation is situated shall be
determined by the State Conservationist, in consultation
with--
``(i) the State technical committee
established under subtitle G; and
``(ii) local agricultural producers and
conservation working groups.
``(4) Conservation practices.--Conservation practices that
may be implemented by a producer under a conservation security
contract (as appropriate for the agricultural operation of a
producer) include--
``(A) nutrient management;
``(B) integrated pest management;
``(C) water conservation (including through
irrigation) and water quality management;
``(D) grazing, pasture, and rangeland management;
``(E) soil conservation, quality, and residue
management;
``(F) invasive species management;
``(G) fish and wildlife habitat conservation,
restoration, and management;
``(H) air quality management;
``(I) energy conservation measures;
``(J) biological resource conservation and
regeneration;
``(K) contour farming;
``(L) strip cropping;
``(M) cover cropping;
``(N) controlled rotational grazing;
``(O) resource-conserving crop rotation;
``(P) conversion of portions of cropland from a
soil-depleting use to a soil-conserving use, including
production of cover crops;
``(Q) partial field conservation practices;
``(R) native grassland and prairie protection and
restoration; and
``(S) any other conservation practices that the
Secretary determines to be appropriate and comparable to
other conservation practices described in this
paragraph.
``(5) Tiers.--Subject to paragraph (6), to carry out this
subsection, the Secretary shall establish the following 3 tiers
of conservation contracts:
``(A) Tier i conservation security contracts.--A
conservation security plan for land enrolled under a
Tier I conservation security contract shall--
``(i) be for a period of 5 years; and
``(ii) include conservation practices
appropriate for the agricultural operation, that,
at a minimum (as determined by the Secretary)--
[[Page 116 STAT. 228]]
``(I) address at least 1 significant
resource of concern for the enrolled
portion of the agricultural operation at
a level that meets the appropriate
nondegradation standard; and
``(II) cover active management of
conservation practices that are
implemented or maintained under the
conservation security contract.
``(B) Tier ii conservation security contracts.--A
conservation security plan for land enrolled under a
Tier II conservation security contract shall--
``(i) be for a period of not less than 5 nor
more than 10 years, as determined by the producer;
``(ii) include conservation practices
appropriate for the agricultural operation, that,
at a minimum--
``(I) address at least 1 significant
resource of concern for the entire
agricultural operation, as determined by
the Secretary, at a level that meets the
appropriate nondegradation standard; and
``(II) cover active management of
conservation practices that are
implemented or maintained under the
conservation security contract.
``(C) Tier iii conservation security contracts.--A
conservation security plan for land enrolled under a
Tier III conservation security contract shall--
``(i) be for a period of not less than 5 nor
more than 10 years, as determined by the producer;
and
``(ii) include conservation practices
appropriate for the agricultural operation that,
at a minimum--
``(I) apply a resource management
system that meets the appropriate
nondegradation standard for all
resources of concern of the entire
agricultural operation, as determined by
the Secretary; and
``(II) cover active management of
conservation practices that are
implemented or maintained under the
conservation security contract.
``(6) Minimum requirements.--The minimum requirements for
each tier of conservation contracts implemented under paragraph
(5) shall be determined and approved by the Secretary.
``(e) Conservation Security Contracts.--
``(1) In general.--On approval of a conservation security
plan of a producer, the Secretary shall enter into a
conservation security contract with the producer to enroll the
land covered by the conservation security plan in the
conservation security program.
``(2) Modification.--
``(A) Optional modifications.--A producer may apply
to the Secretary for a modification of the conservation
security contract of the producer that is consistent
with the purposes of the conservation security program.
``(B) Other modifications.--
``(i) In general.--The Secretary may, in
writing, require a producer to modify a
conservation security contract before the
expiration of the conservation security contract
if the Secretary determines that a change made to
the type, size, management, or other aspect of the
agricultural operation of the producer would,
[[Page 116 STAT. 229]]
without the modification of the contract,
significantly interfere with achieving the
purposes of the conservation security program.
``(ii) Participation in other programs.--If
appropriate payment reductions and other
adjustments (as determined by the Secretary) are
made to the conservation security contract of a
producer, the producer may--
``(I) simultaneously participate
in--
``(aa) the conservation
security program;
``(bb) the conservation
reserve program under subchapter
B of chapter 1; and
``(cc) the wetlands reserve
program under subchapter C of
chapter 1; and
``(II) may remove land enrolled in
the conservation security program for
enrollment in a program described in
item (bb) or (cc) of subclause (I).
``(3) Termination.--
``(A) Optional termination.--A producer may
terminate a conservation security contract and retain
payments received under the conservation security
contract, if--
``(i) the producer is in full compliance with
the terms and conditions (including any
maintenance requirements) of the conservation
security contract as of the date of the
termination; and
``(ii) the Secretary determines that
termination of the contract would not defeat the
purposes of the conservation security plan of the
producer.
``(B) Other termination.--A producer that is
required to modify a conservation security contract
under paragraph (2)(B)(i) may, in lieu of modifying the
contract--
``(i) terminate the conservation security
contract; and
``(ii) retain payments received under the
conservation security contract, if the producer
has fully complied with the terms and conditions
of the conservation security contract before
termination of the contract, as determined by the
Secretary.
``(4) Renewal.--
``(A) In general.--Except as provided in
subparagraph (B), at the option of a producer, the
conservation security contract of the producer may be
renewed for an additional period of not less than 5 nor
more than 10 years.
``(B) Tier i renewals.--In the case of a Tier I
conservation security contract of a producer, the
producer may renew the contract only if the producer
agrees--
``(i) to apply additional conservation
practices that meet the nondegradation standard on
land already enrolled in the conservation security
program; or
``(ii) to adopt new conservation practices
with respect to another portion of the
agricultural operation that address resource
concerns and meet the nondegradation standard
under the terms of the Tier I conservation
security contract.
``(f) Noncompliance Due to Circumstances Beyond the Control of
Producers.--The Secretary shall include in the conservation security
contract a provision, and may permit modification
[[Page 116 STAT. 230]]
of a conservation security contract under subsection (e)(1), to ensure
that a producer shall not be considered in violation of a conservation
security contract for failure to comply with the conservation security
contract due to circumstances beyond the control of the producer,
including a disaster or related condition, as determined by the
Secretary.
``SEC. 1238B. <<NOTE: 16 USC 3838b.>> DUTIES OF PRODUCERS.
``Under a conservation security contract, a producer shall agree,
during the term of the conservation security contract--
``(1) to implement the applicable conservation security plan
approved by the Secretary;
``(2) to maintain, and make available to the Secretary at
such times as the Secretary may request, appropriate records
showing the effective and timely implementation of the
conservation security plan;
``(3) not to engage in any activity that would interfere
with the purposes of the conservation security program; and
``(4) on the violation of a term or condition of the
conservation security contract--
``(A) if the Secretary determines that the violation
warrants termination of the conservation security
contract--
``(i) to forfeit all rights to receive
payments under the conservation security contract;
and
``(ii) to refund to the Secretary all or a
portion of the payments received by the producer
under the conservation security contract,
including any advance payments and interest on the
payments, as determined by the Secretary; or
``(B) if the Secretary determines that the violation
does not warrant termination of the conservation
security contract, to refund to the Secretary, or accept
adjustments to, the payments provided to the producer,
as the Secretary determines to be appropriate.
``SEC. 1238C. <<NOTE: 16 USC 3838c.>> DUTIES OF THE SECRETARY.
``(a) Timing of Payments.--The Secretary shall make payments under a
conservation security contract as soon as practicable after October 1 of
each fiscal year.
``(b) Annual Payments.--
``(1) Criteria for determining amount of payments.--
``(A) Base payment.--A base payment under this
paragraph shall be (as determined by the Secretary)--
``(i) the average national per-acre rental
rate for a specific land use during the 2001 crop
year; or
``(ii) another appropriate rate for the 2001
crop year that ensures regional equity.
``(B) Payments.--A payment for a conservation
practice under this paragraph shall be determined in
accordance with subparagraphs (C) through (E).
``(C) Tier i conservation security contracts.--The
payment for a Tier I conservation security contract
shall consist of the total of the following amounts:
``(i) An amount equal to 5 percent of the
applicable base payment for land covered by the
contract.
``(ii) An amount that does not exceed 75
percent (or, in the case of a beginning farmer or
rancher, 90 percent) of the average county costs
of practices
[[Page 116 STAT. 231]]
for the 2001 crop year that are included in the
conservation security contract, as determined by
the Secretary, including the costs of--
``(I) the adoption of new
management, vegetative, and land-based
structural practices;
``(II) the maintenance of existing
land management and vegetative
practices; and
``(III) the maintenance of existing
land-based structural practices that are
approved by the Secretary but not
already covered by a Federal or State
maintenance requirement.
``(iii) An enhanced payment that is determined
by the Secretary in a manner that ensures equity
across regions of the United States, if the
producer--
``(I) implements or maintains
multiple conservation practices that
exceed minimum requirements for the
applicable tier of participation
(including practices that involve a
change in land use, such as resource-
conserving crop rotation, managed
rotational grazing, or conservation
buffer practices);
``(II) addresses local conservation
priorities in addition to resources of
concern for the agricultural operation;
``(III) participates in an on-farm
conservation research, demonstration, or
pilot project;
``(IV) participates in a watershed
or regional resource conservation plan
that involves at least 75 percent of
producers in a targeted area; or
``(V) carries out assessment and
evaluation activities relating to
practices included in a conservation
security plan.
``(D) Tier ii conservation security contracts.--The
payment for a Tier II conservation security contract
shall consist of the total of the following amounts:
``(i) An amount equal to 10 percent of the
applicable base payment for land covered by the
conservation security contract.
``(ii) An amount that does not exceed 75
percent (or, in the case of a beginning farmer or
rancher, 90 percent) of the average county cost of
adopting or maintaining practices for the 2001
crop year that are included in the conservation
security contract, as described in subparagraph
(C)(ii).
``(iii) An enhanced payment that is determined
in accordance with subparagraph (C)(iii).
``(E) Tier iii conservation security contracts.--The
payment for a Tier III conservation security contract
shall consist of the total of the following amounts:
``(i) An amount equal to 15 percent of the
base payment for land covered by the conservation
security contract.
``(ii) An amount that does not exceed 75
percent (or, in the case of a beginning farmer or
rancher, 90 percent) of the average county cost of
adopting or maintaining practices for the 2001
crop year that
[[Page 116 STAT. 232]]
are included in the conservation security
contract, as described in subparagraph (C)(ii).
``(iii) An enhanced payment that is determined
in accordance with subparagraph (C)(iii).
``(2) Limitation on payments.--
``(A) In general.--Subject to paragraphs (1) and
(3), the Secretary shall make an annual payment,
directly or indirectly, to an individual or entity
covered by a conservation security contract in an amount
not to exceed--
``(i) in the case of a Tier I conservation
security contract, $20,000;
``(ii) in the case of a Tier II conservation
security contract, $35,000; or
``(iii) in the case of a Tier III conservation
security contract, $45,000.
``(B) Limitation on base payments.--In applying the
payment limitation under each of clauses (i), (ii), and
(iii) of subparagraph (A), an individual or entity may
not receive, directly or indirectly, payments described
in clause (i) of paragraph (1)(C), (1)(D), or (1)(E), as
appropriate, in an amount that exceeds--
``(i) in the case of Tier I contracts, 25
percent of the applicable payment limitation; or
``(ii) in the case of Tier II contracts and
Tier III contracts, 30 percent of the applicable
payment limitation.
``(C) Other usda payments.--A producer shall not
receive payments under the conservation security program
and any other conservation program administered by the
Secretary for the same practices on the same land.
``(D) Commensurate share.--To be eligible to receive
a payment under this subchapter, an individual or entity
shall make contributions (including contributions of
land, labor, management, equipment, or capital) to the
operation of the farm that are at least commensurate
with the share of the proceeds of the operation of the
individual or entity.
``(3) Equipment or facilities.--A payment to a producer
under this subchapter shall not be provided for--
``(A) construction or maintenance of animal waste
storage or treatment facilities or associated waste
transport or transfer devices for animal feeding
operations; or
``(B) the purchase or maintenance of equipment or a
non-land based structure that is not integral to a land-
based practice, as determined by the Secretary.
``(c) Minimum Practice Requirement.--In determining a payment under
subsection (b) for a producer that receives a payment under another
program administered by the Secretary that is contingent on complying
with requirements under subtitle B or C (relating to the use of highly
erodible land or wetland), a payment under this subchapter on land
subject to those requirements shall be for practices only to the extent
that the practices exceed minimum requirements for the producer under
those subtitles, as determined by the Secretary.
``(d) Regulations.--The Secretary shall promulgate regulations
that--
[[Page 116 STAT. 233]]
``(1) provide for adequate safeguards to protect the
interests of tenants and sharecroppers, including provision for
sharing payments, on a fair and equitable basis; and
``(2) prescribe such other rules as the Secretary determines
to be necessary to ensure a fair and reasonable application of
the limitations established under subsection (b).
``(e) Transfer or Change of Interest in Land Subject to Conservation
Security Contract.--
``(1) In general.--Except as provided in paragraph (2), the
transfer, or change in the interest, of a producer in land
subject to a conservation security contract shall result in the
termination of the conservation security contract.
``(2) Transfer of duties and <<NOTE: Deadline.>> rights.--
Paragraph (1) shall not apply if, not later than 60 days after
the date of the transfer or change in the interest in land, the
transferee of the land provides written notice to the Secretary
that all duties and rights under the conservation security
contract have been transferred to, and assumed by, the
transferee.
``(f) Enrollment Procedure.--In entering into conservation security
contracts with producers under this subchapter, the Secretary shall not
use competitive bidding or any similar procedure.
``(g) Technical Assistance.--For each of fiscal years 2003 through
2007, the Secretary shall provide technical assistance to producers for
the development and implementation of conservation security contracts,
in an amount not to exceed 15 percent of amounts expended for the fiscal
year.''.
(b) Regulations.-- <<NOTE: Deadline. 16 USC 3838 note.>> Not later
than 270 days after the date of enactment of this Act, the Secretary of
Agriculture shall promulgate regulations implementing the amendment made
by subsection (a).
SEC. 2002. CONSERVATION COMPLIANCE.
(a) Highly Erodible Land.--Section 1211 of the Food Security Act of
1985 (16 U.S.C. 3811) is amended--
(1) by striking the section heading and all that follows
through ``Except as provided in'' and inserting the following:
``SEC. 1211. PROGRAM INELIGIBILITY.
``(a) In General.--Except as provided in''; and
(2) by adding at the end the following:
``(b) Highly Erodible Land.--The Secretary shall have, and shall not
delegate to any private person or entity, authority to determine whether
a person has complied with this subtitle.''.
(b) Wetland.--Section 1221 of the Food Security Act of 1985 (16
U.S.C. 3821) is amended by adding at the end the following:
``(e) Wetland.--The Secretary shall have, and shall not delegate to
any private person or entity, authority to determine whether a person
has complied with this subtitle.''.
SEC. 2003. PARTNERSHIPS AND COOPERATION.
Section 1243 of the Food Security Act of 1985 (16 U.S.C. 3843) is
amended by adding at the end the following:
``(f) Partnerships and Cooperation.--
``(1) In general.--In carrying out any program under
subtitle D, the Secretary may use resources provided under that
subtitle to enter into stewardship agreements with State and
local agencies, Indian tribes, and nongovernmental organizations
and to designate special projects, as recommended by the State
Conservationist, after consultation with the State
[[Page 116 STAT. 234]]
technical committee, to enhance technical and financial
assistance provided to owners, operators, and producers to
address natural resource issues related to agricultural
production.
``(2) Criteria for special projects.--The purposes of
special projects carried out under this subsection shall be to
encourage--
``(A) producers to cooperate in the installation and
maintenance of conservation practices that affect
multiple agricultural operations;
``(B) the sharing of information and technical and
financial resources among producers;
``(C) cumulative conservation benefits in geographic
areas; and
``(D) the development and demonstration of
innovative conservation methods.
``(3) Incentives.--To realize the purposes of the special
projects under paragraph (1), the Secretary may provide special
incentives to owners, operators, and producers participating in
the special projects to encourage partnerships and enrollments
of optimal conservation value.
``(4) Flexibility.--
``(A) In general.--The Secretary may enter into
stewardship agreements with States (including State
agencies and units of local government), Indian tribes,
and nongovernmental organizations that have a history of
working with agricultural producers to allow greater
flexibility to adjust the application of eligibility
criteria, approved practices, innovative conservation
practices, and other elements of the programs under this
title to better reflect unique local circumstances and
purposes in a manner that is consistent with--
``(i) conservation enhancement and long-term
productivity of the natural resource base; and
``(ii) the purposes and requirements of this
title.
``(B) Plan.--Each party to a stewardship agreement
under subparagraph (A) shall submit to the Secretary,
for approval by the Secretary, a special project area
plan for each program to be carried out by the party
that includes--
``(i) a description of the requested resources
and adjustments to program implementation
(including a description of how those adjustments
will accelerate the achievement of conservation
benefits);
``(ii) an analysis of the contribution those
adjustments will make to the effectiveness of
programs in achieving the purposes of the special
project;
``(iii) a timetable for reevaluating the need
for or performance of the proposed adjustments;
``(iv) a description of non-Federal programs
and resources that will contribute to achieving
the purposes of the special project; and
``(v) a plan for the evaluation of progress
toward the purposes of the special project.
``(5) Funding.--
``(A) In general.--In addition to resources from
programs under subtitle D, subject to subparagraph (B),
the Secretary shall use not more than 5 percent of the
funds
[[Page 116 STAT. 235]]
made available for each fiscal year under section
1241(a) to carry out activities that are authorized
under conservation programs under subtitle D.
``(B) Unused funding.--Any funds made available for
a fiscal year under subparagraph (A) that are not
obligated by April 1 of the fiscal year may be used to
carry out other activities under conservation programs
under subtitle D during the fiscal year in which the
funding becomes available.''.
SEC. 2004. ADMINISTRATIVE REQUIREMENTS FOR CONSERVATION PROGRAMS.
(a) In General.--Subtitle E of title XII of the Food Security Act of
1985 (16 U.S.C. 3841 et seq.) is amended by adding at the end the
following:
``SEC. 1244. <<NOTE: 16 USC 3844.>> ADMINISTRATIVE REQUIREMENTS FOR
CONSERVATION PROGRAMS.
``(a) Beginning Farmers and Ranchers and Indian Tribes.--In carrying
out any conservation program administered by the Secretary, the
Secretary may provide to beginning farmers and ranchers and Indian
tribes (as those terms are defined in section 1238) and limited resource
agricultural producers incentives to participate in the conservation
program to--
``(1) foster new farming and ranching opportunities; and
``(2) enhance environmental stewardship over the long term.
``(b) Privacy of Personal Information Relating to Natural Resources
Conservation Programs.--
``(1) Information received for technical and financial
assistance.--
``(A) In general.--In accordance with section
552(b)(3) of title 5, United States Code, except as
provided in subparagraph (C) and paragraph (2),
information described in subparagraph (B)--
``(i) shall not be considered to be public
information; and
``(ii) shall not be released to any person or
Federal, State, local agency or Indian tribe (as
defined by the Secretary) outside the Department
of Agriculture.
``(B) Information.--The information referred to in
subparagraph (A) is information--
``(i) provided to the Secretary or a
contractor of the Secretary (including information
provided under subtitle D) for the purpose of
providing technical or financial assistance to an
owner, operator, or producer with respect to any
natural resources conservation program
administered by the Natural Resources Conservation
Service or the Farm Service Agency; and
``(ii) that is proprietary (within the meaning
of section 552(b)(4) of title 5, United States
Code) to the agricultural operation or land that
is a part of an agricultural operation of the
owner, operator, or producer.
``(C) Exception.--Nothing in this section affects
the availability of payment information (including
payment amounts and the names and addresses of
recipients of payments) under section 552 of title 5,
United States Code.
``(2) Exceptions.--
[[Page 116 STAT. 236]]
``(A) Release and disclosure for enforcement.--The
Secretary may release or disclose to the Attorney
General information covered by paragraph (1) to the
extent necessary to enforce the natural resources
conservation programs referred to in paragraph
(1)(B)(i).
``(B) Disclosure to cooperating persons and
agencies.--
``(i) In general.--The Secretary may release
or disclose information covered by paragraph (1)
to a person or Federal, State, local, or tribal
agency working in cooperation with the Secretary
in providing technical and financial assistance
described in paragraph (1)(B)(i) or collecting
information from data gathering sites.
``(ii) Use of information.--The person or
Federal, State, local, or tribal agency that
receives information described in clause (i) may
release the information only for the purpose of
assisting the Secretary--
``(I) in providing the requested
technical or financial assistance; or
``(II) in collecting information
from data gathering sites.
``(C) Statistical and aggregate information.--
Information covered by paragraph (1) may be disclosed to
the public if the information has been transformed into
a statistical or aggregate form without naming any--
``(i) individual owner, operator, or producer;
or
``(ii) specific data gathering site.
``(D) Consent of owner, operator, or producer.--
``(i) In general.--An owner, operator, or
producer may consent to the disclosure of
information described in paragraph (1).
``(ii) Condition of other programs.--The
participation of the owner, operator, or producer
in, and the receipt of any benefit by the owner,
operator, or producer under, this title or any
other program administered by the Secretary may
not be conditioned on the owner, operator, or
producer providing consent under this paragraph.
``(3) Violations; penalties.--Section 1770(c) shall apply
with respect to the release of information collected in any
manner or for any purpose prohibited by this subsection.
``(4) Data collection, disclosure, and review.--Nothing in
this subsection--
``(A) affects any procedure for data collection or
disclosure through the National Resources Inventory; or
``(B) limits the authority of Congress or the
General Accounting Office to review information
collected or disclosed under this subsection.''.
(b) National Resources Inventory.--Section 1770 of the Food Security
Act of 1985 (7 U.S.C. 2276) is amended--
(1) in subsection (a)--
(A) in paragraph (1), by striking ``or'' at the end;
(B) in paragraph (2), by striking the period and
inserting ``; or''; and
(C) by adding at the end the following:
[[Page 116 STAT. 237]]
``(3) in the case of information collected under the
authority described in subsection (d)(12), disclose the
information to any person or any Federal, State, local, or
tribal agency outside the Department of Agriculture, unless the
information has been converted into a statistical or aggregate
form that does not allow the identification of the person that
supplied particular information.''; and
(2) in subsection (d)--
(A) in paragraph (9), by striking ``or'' at the end;
(B) in paragraph (11), by striking the period and
inserting ``; or''; and
(C) by adding at the end the following:
``(12) section 302 of the Rural Development Act of 1972 (7
U.S.C. 1010a) regarding the authority to collect data for the
National Resources Inventory.''.
SEC. 2005. <<NOTE: 16 USC 3801 note.>> REFORM AND ASSESSMENT OF
CONSERVATION PROGRAMS.
(a) In General.--The Secretary of Agriculture shall develop a plan
to coordinate land retirement and agricultural working land conservation
programs that are administered by the Secretary to achieve the goals
of--
(1) eliminating redundancy;
(2) streamlining program delivery; and
(3) improving services provided to agricultural producers
(including the reevaluation of the provision of technical
assistance).
(b) Report.--Not <<NOTE: Deadline.>> later than December 31, 2005,
the Secretary of Agriculture shall submit to the Committee on
Agriculture of the House of Representatives and the Committee on
Agriculture, Nutrition, and Forestry of the Senate, a report that
describes--
(1) the plan developed under subsection (a); and
(2) the means by which the Secretary intends to achieve the
goals described in subsection (a).
SEC. 2006. CONFORMING AMENDMENTS.
(a) Chapter 1 of subtitle D of title XII of the Food Security Act of
1985 (16 U.S.C. 3830 et seq.) is amended by striking the chapter heading
and inserting the following:
``CHAPTER 1--COMPREHENSIVE CONSERVATION ENHANCEMENT PROGRAM''.
(b) Section 1230 of the Food Security Act of 1985 (16 U.S.C. 3830)
is amended--
(1) in the section heading, by striking ``environmental
conservation acreage reserve program'' and inserting
``comprehensive conservation enhancement program'';
(2) in subsection (a)(1), by striking ``an environmental
conservation acreage reserve program'' and inserting ``a
comprehensive conservation enhancement program'';
(3) by striking subsection (c); and
(4) by striking ``ECARP'' each place it appears and
inserting ``CCEP''.
(c) Section 1230A of the Food Security Act of 1985 (16 U.S.C. 3830a)
is repealed.
(d) Section 1243 of the Food Security Act of 1985 (16 U.S.C. 3843)
is amended by striking the section heading and inserting the following:
[[Page 116 STAT. 238]]
``SEC. 1243. ADMINISTRATION OF CCEP.''.
Subtitle B--Conservation Reserve
SEC. 2101. CONSERVATION RESERVE PROGRAM.
(a) In General.--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.) is amended
to read as follows:
``Subchapter B--Conservation Reserve
``SEC. 1231. <<NOTE: 16 USC 3831.>> CONSERVATION RESERVE.
``(a) In General.--Through the 2007 calendar year, the Secretary
shall formulate and carry out a conservation reserve program under which
land is enrolled through the use of contracts to assist owners and
operators of land specified in subsection (b) to conserve and improve
the soil, water, and wildlife resources of such land.
``(b) Eligible Land.--The Secretary may include in the program
established under this subchapter--
``(1) highly erodible cropland that--
``(A)(i) if permitted to remain untreated could
substantially reduce the agricultural production
capability for future generations; or
``(ii) cannot be farmed in accordance with a plan
that complies with the requirements of subtitle B; and
``(B) the Secretary determines had a cropping
history or was considered to be planted for 4 of the 6
years preceding the date of enactment of the Farm
Security and Rural Investment Act of 2002 (except for
land enrolled in the conservation reserve program as of
that date).
``(2) marginal pasture land converted to wetland or
established as wildlife habitat prior to November 28, 1990;
``(3) marginal pasture land to be devoted to appropriate
vegetation, including trees, in or near riparian areas, or
devoted to similar water quality purposes (including marginal
pastureland converted to wetland or established as wildlife
habitat);
``(4) cropland that is otherwise ineligible if the Secretary
determines that--
``(A) if permitted to remain in agricultural
production, the land would--
``(i) contribute to the degradation of soil,
water, or air quality; or
``(ii) pose an on-site or off-site
environmental threat to soil, water, or air
quality;
``(B) the land is a--
``(i) newly-created, permanent grass sod
waterway; or
``(ii) a contour grass sod strip established
and maintained as part of an approved conservation
plan;
``(C) the land will be devoted to newly established
living snow fences, permanent wildlife habitat,
windbreaks, shelterbelts, or filterstrips devoted to
trees or shrubs; or
``(D) the land poses an off-farm environmental
threat, or a threat of continued degradation of
productivity due to soil salinity, if permitted to
remain in production; and
[[Page 116 STAT. 239]]
``(E) enrollment of the land would facilitate a net
savings in groundwater or surface water resources of the
agricultural operation of the producer;
``(5) the portion of land in a field not enrolled in the
conservation reserve in a case in which more than 50 percent of
the land in the field is enrolled as a buffer, if--
``(A) the land is enrolled as part of the buffer;
and
``(B) the remainder of the field is--
``(i) infeasible to farm; and
``(ii) enrolled at regular rental rates.
``(c) Planting Status of Certain Land.--For purposes of determining
the eligibility of land to be placed in the conservation reserve
established under this subchapter, land shall be considered to be
planted to an agricultural commodity during a crop year if--
``(1) during the crop year, the land was devoted to a
conserving use; or
``(2)(A) during the crop year or during any of the 2 years
preceding the crop year, the land was enrolled in the water bank
program; and
``(B) the contract of the owner or operator of the cropland
expired or will expire in calendar year 2000, 2001, or 2002.
``(d) Maximum Enrollment.--The Secretary may maintain up to
39,200,000 acres in the conservation reserve at any 1 time during the
2002 through 2007 calendar years (including contracts extended by the
Secretary pursuant to section 1437(c) of the Food, Agriculture,
Conservation, and Trade Act of 1990 ( 16 U.S.C. 3831 note; Public Law
101-624)).
``(e) Duration of Contract.--
``(1) In general.--For the purpose of carrying out this
subchapter, the Secretary shall enter into contracts of not less
than 10, nor more than 15, years.
``(2) Certain land.--
``(A) In general.--In the case of land devoted to
hardwood trees, shelterbelts, windbreaks, or wildlife
corridors under a contract entered into under this
subchapter after October 1, 1990, and land devoted to
such uses under contracts modified under section 1235A,
the owner or operator of the land may, within the
limitations prescribed under this section, specify the
duration of the contract.
``(B) Hardwood trees.--In the case of land that is
devoted to hardwood trees under a contract entered into
under this subchapter prior to October 1, 1990, the
Secretary may extend the contract for a term of not to
exceed 5 years, as agreed to by the owner or operator of
such land and the Secretary.
``(3) 1-year extension.--In the case of a contract described
in paragraph (1) the term of which expires during calendar year
2002, an owner or operator of land enrolled under the contract
may extend the contract for 1 additional year.
``(f) Conservation Priority Areas.--
``(1) Designation.--On application by the appropriate State
agency, the Secretary shall designate watershed areas of the
Chesapeake Bay Region (Pennsylvania, Maryland, and Virginia),
the Great Lakes Region, the Long Island Sound Region, and other
areas of special environmental sensitivity as conservation
priority areas.
[[Page 116 STAT. 240]]
``(2) Eligible watersheds.--Watersheds eligible for
designation under this subsection shall include areas with
actual and significant adverse water quality or habitat impacts
related to agricultural production activities.
``(3) Expiration.--Conservation priority area designation
under this subsection shall expire after 5 years, subject to
redesignation, except that the Secretary may withdraw a
watershed's designation--
``(A) on application by the appropriate State
agency; or
``(B) in the case of an area covered by this
subsection, if the Secretary finds that the area no
longer contains actual and significant adverse water
quality or habitat impacts related to agricultural
production activities.
``(4) Duty of secretary.--In carrying out this subsection,
the Secretary shall attempt to maximize water quality and
habitat benefits in the watersheds described in paragraph (1) by
promoting a significant level of enrollment of land within the
watersheds in the program under this subchapter by whatever
means the Secretary determines are appropriate and consistent
with the purposes of this subchapter.
``(g) Multi-Year Grasses and Legumes.--For purposes of this
subchapter, alfalfa and other multi-year grasses and legumes in a
rotation practice, approved by the Secretary, shall be considered
agricultural commodities.
``(h) Pilot Program for Enrollment of Wetland and Buffer Acreage in
Conservation Reserve.--
``(1) Program.--
``(A) In general.--During the 2002 through 2007
calendar years, the Secretary shall carry out a program
in each State under which the Secretary shall include
eligible acreage described in paragraph (2) in the
program established under this subchapter.
``(B) Participation among states.-The Secretary
shall ensure, to the maximum extent practicable, that
owners and operators in each State have an equitable
opportunity to participate in the pilot program
established under this subsection.
``(2) Eligible acreage.--
``(A) In general.--Subject to subparagraphs (B)
through (D), an owner or operator may enroll in the
conservation reserve under this subsection--
``(i) a wetland (including a converted wetland
described in section 1222(b)(1)(A)) that was
cropped during at least 3 of the immediately
preceding 10 crop years; and
``(ii) buffer acreage that--
``(I) is contiguous to the wetland
described in clause (i);
``(II) is used to protect the
wetland; and
``(III) is of such width as the
Secretary determines is necessary to
protect the wetland, taking into
consideration and accommodating the
farming practices (including the
straightening of boundaries to
accommodate machinery) used with respect
to the cropland that surrounds the
wetland.
[[Page 116 STAT. 241]]
``(B) Exclusions.--An owner or operator may not
enroll in the conservation reserve under this
subsection--
``(i) any wetland, or land on a floodplain,
that is, or is adjacent to, a perennial riverine
system wetland identified on the final national
wetland inventory map of the Secretary of the
Interior; or
``(ii) in the case of an area that is not
covered by the final national inventory map, any
wetland, or land on a floodplain, that is adjacent
to a perennial stream identified on a 1-24,000
scale map of the United States Geological Survey.
``(C) Program limitations.--
``(i) In general.--The Secretary may enroll in
the conservation reserve under this subsection not
more than--
``(I) 100,000 acres in any 1 State
referred to in paragraph (1); and
``(II) not more than a total of
1,000,000 acres.
``(ii) Relationship to program maximum.--
Subject to clause (iii), for the purposes of
subsection (d), any acreage enrolled in the
conservation reserve under this subsection shall
be considered acres maintained in the conservation
reserve.
``(iii) Relationship to other enrolled
acreage.--Acreage enrolled under this subsection
shall not affect for any fiscal year the quantity
of--
``(I) acreage enrolled to establish
conservation buffers as part of the
program announced on March 24, 1998 (63
Fed. Reg. 14109); or
``(II) acreage enrolled into the
conservation reserve enhancement program
announced on May 27, 1998 (63 Fed. Reg.
28965).
``(iv) Review; potential increase in
enrollment acreage.--Not <<NOTE: Deadline.>> later
than 3 years after the date of enactment of this
clause, the Secretary shall--
``(I) conduct a review of the
program under this subsection with
respect to each State that has enrolled
land in the program; and
``(II) notwithstanding clause
(i)(I), increase the number of acres
that may be enrolled by a State under
clause (i)(I) to not more than 150,000
acres, as determined by the Secretary.
``(D) Owner or operator limitations.--
``(i) Wetland.--
``(I) In general.--The maximum size
of any wetland described in subparagraph
(A)(i) of an owner or operator enrolled
in the conservation reserve under this
subsection shall be 10 contiguous acres,
of which not more than 5 acres shall be
eligible for payment.
``(II) Coverage.--All acres
described in subclause (I) (including
acres that are ineligible for payment)
shall be covered by the conservation
contract.
``(ii) Buffer acreage.--The maximum size of
any buffer acreage described in subparagraph
(A)(ii) of an
[[Page 116 STAT. 242]]
owner or operator enrolled in the conservation
reserve under this subsection shall be the greater
of--
``(I) 3 times the size of any
wetland described in subparagraph (A)(i)
to which the buffer acreage is
contiguous; or
``(II) 150 feet on either side of
the wetland.
``(iii) Tracts.--The maximum size of any
eligible acreage described in subparagraph (A) in
a tract (as determined by the Secretary) of an
owner or operator enrolled in the conservation
reserve under this subsection shall be 40 acres.
``(3) Duties of owners and operators.--Under a contract
entered into under this subsection, during the term of the
contract, an owner or operator of a farm or ranch shall agree--
``(A) to restore the hydrology of the wetland within
the eligible acreage to the maximum extent practicable,
as determined by the Secretary;
``(B) to establish vegetative cover (which may
include emerging vegetation in water) on the eligible
acreage, as determined by the Secretary; and
``(C) to carry out other duties described in section
1232.
``(4) Duties of the secretary.--
``(A) In general.--Except as provided in
subparagraphs (B) and (C), in return for a contract
entered into by an owner or operator under this
subsection, the Secretary shall make payments and
provide assistance to the owner or operator in
accordance with sections 1233 and 1234.
``(B) Continuous signup.--The Secretary shall use
continuous signup under section 1234(c)(2)(B) to
determine the acceptability of contract offers and the
amount of rental payments under this subsection.
``(C) Incentives.--The amounts payable to owners and
operators in the form of rental payments under contracts
entered into under this subsection shall reflect
incentives that are provided to owners and operators to
enroll filterstrips in the conservation reserve under
section 1234.
``(i) Eligibility for Consideration.--On the expiration of a
contract entered into under this subchapter, the land subject to the
contract shall be eligible to be considered for reenrollment in the
conservation reserve.
``(j) Balance of Natural Resource Purposes.--In determining the
acceptability of contract offers under this subchapter, the Secretary
shall ensure, to the maximum extent practicable, an equitable balance
among the conservation purposes of soil erosion, water quality, and
wildlife habitat.
``SEC. 1232. DUTIES OF OWNERS AND OPERATORS.
``(a) In General.--Under <<NOTE: 16 USC 3832.>> the terms of a
contract entered into under this subchapter, during the term of the
contract, an owner or operator of a farm or ranch shall agree--
``(1) to implement a plan approved by the local conservation
district (or in an area not located within a conservation
district, a plan approved by the Secretary) for converting
eligible land normally devoted to the production of an
agricultural commodity on the farm or ranch to a less intensive
use (as defined by the Secretary), such as pasture, permanent
grass, legumes,
[[Page 116 STAT. 243]]
forbs, shrubs, or trees, substantially in accordance with a
schedule outlined in the plan;
``(2) to place highly erodible cropland subject to the
contract in the conservation reserve established under this
subchapter;
``(3) not to use the land for agricultural purposes, except
as permitted by the Secretary;
``(4) to establish approved vegetative cover (which may
include emerging vegetation in water), water cover for the
enhancement of wildlife, or, where practicable, maintain
existing cover on the land, except that--
``(A) the water cover shall not include ponds for
the purpose of watering livestock, irrigating crops, or
raising fish for commercial purposes; and
``(B) the Secretary shall not terminate the contract
for failure to establish approved vegetative or water
cover on the land if--
``(i) the failure to plant the cover was due
to excessive rainfall or flooding;
``(ii) the land subject to the contract that
could practicably be planted to the cover is
planted to the cover; and
``(iii) the land on which the owner or
operator was unable to plant the cover is planted
to the cover after the wet conditions that
prevented the planting subsides;
``(5) on a violation of a term or condition of the contract
at any time the owner or operator has control of the land--
``(A) to forfeit all rights to receive rental
payments and cost sharing payments under the contract
and to refund to the Secretary any rental payments and
cost sharing payments received by the owner or operator
under the contract, together with interest on the
payments as determined by the Secretary, if the
Secretary, after considering the recommendations of the
soil conservation district and the Natural Resources
Conservation Service, determines that the violation is
of such nature as to warrant termination of the
contract; or
``(B) to refund to the Secretary, or accept
adjustments to, the rental payments and cost sharing
payments provided to the owner or operator, as the
Secretary considers appropriate, if the Secretary
determines that the violation does not warrant
termination of the contract;
``(6) on the transfer of the right and interest of the owner
or operator in land subject to the contract--
``(A) to forfeit all rights to rental payments and
cost sharing payments under the contract; and
``(B) to refund to the United States all rental
payments and cost sharing payments received by the owner
or operator, or accept such payment adjustments or make
such refunds as the Secretary considers appropriate and
consistent with the objectives of this subchapter;
unless the transferee of the land agrees with the Secretary to
assume all obligations of the contract, except that no refund of
rental payments and cost sharing payments shall be required if
the land is purchased by or for the United States Fish and
Wildlife Service, or the transferee and the Secretary agree
[[Page 116 STAT. 244]]
to modifications to the contract, in a case in which the
modifications are consistent with the objectives of the program,
as determined by the Secretary;
``(7) not to conduct any harvesting or grazing, nor
otherwise make commercial use of the forage, on land that is
subject to the contract, nor adopt any similar practice
specified in the contract by the Secretary as a practice that
would tend to defeat the purposes of the contract, except that
the Secretary may permit, consistent with the conservation of
soil, water quality, and wildlife habitat (including habitat
during nesting seasons for birds in the area)--
``(A) managed harvesting and grazing (including the
managed harvesting of biomass), except that in
permitting managed harvesting and grazing, the
Secretary--
``(i) shall, in coordination with the State
technical committee--
``(I) develop appropriate vegetation
management requirements; and
``(II) identify periods during which
harvesting and grazing under this
paragraph may be conducted;
``(ii) may permit harvesting and grazing or
other commercial use of the forage on the land
that is subject to the contract in response to a
drought or other emergency; and
``(iii) shall, in the case of routine managed
harvesting or grazing or harvesting or grazing
conducted in response to a drought or other
emergency, reduce the rental payment otherwise
payable under the contract by an amount
commensurate with the economic value of the
activity; and
``(B) the installation of wind turbines, except that
in permitting the installation of wind turbines, the
Secretary shall determine the number and location of
wind turbines that may be installed, taking into
account--
``(i) the location, size, and other physical
characteristics of the land;
``(ii) the extent to which the land contains
wildlife and wildlife habitat; and
``(iii) the purposes of the conservation
reserve program under this subchapter;
``(8) not to conduct any planting of trees on land that is
subject to the contract unless the contract specifies that the
harvesting and commercial sale of trees such as Christmas trees
are prohibited, nor otherwise make commercial use of trees on
land that is subject to the contract unless it is expressly
permitted in the contract, nor adopt any similar practice
specified in the contract by the Secretary as a practice that
would tend to defeat the purposes of the contract, except that
no contract shall prohibit activities consistent with customary
forestry practice, such as pruning, thinning, or stand
improvement of trees, on land converted to forestry use;
``(9) not to adopt any practice specified by the Secretary
in the contract as a practice that would tend to defeat the
purposes of this subchapter; and
``(10) to comply with such additional provisions as the
Secretary determines are desirable and are included in the
contract
[[Page 116 STAT. 245]]
to carry out this subchapter or to facilitate the practical
administration of this subchapter.
``(b) Conservation Plans.--The plan referred to in subsection
(a)(1)--
``(1) shall set forth--
``(A) the conservation measures and practices to be
carried out by the owner or operator during the term of
the contract; and
``(B) the commercial use, if any, to be permitted on
the land during the term; and
``(2) may provide for the permanent retirement of any
existing cropland base and allotment history for the land.
``(c) Foreclosure.--
``(1) In general.--Notwithstanding any other provision of
law, an owner or operator who is a party to a contract entered
into under this subchapter may not be required to make
repayments to the Secretary of amounts received under the
contract if the land that is subject to the contract has been
foreclosed on and the Secretary determines that forgiving the
repayments is appropriate in order to provide fair and equitable
treatment.
``(2) Resumption of control.--
``(A) In general.--This subsection shall not void
the responsibilities of an owner or operator under the
contract if the owner or operator resumes control over
the land that is subject to the contract within the
period specified in the contract.
``(B) Contract.--On the resumption of the control
over the land by the owner or operator, the provisions
of the contract in effect on the date of the foreclosure
shall apply.
``SEC. 1233. <<NOTE: 16 USC 3833.>> DUTIES OF THE SECRETARY.
``In return for a contract entered into by an owner or operator
under section 1232, the Secretary shall--
``(1) share the cost of carrying out the conservation
measures and practices set forth in the contract for which the
Secretary determines that cost sharing is appropriate and in the
public interest; and
``(2) for a period of years not in excess of the term of the
contract, pay an annual rental payment in an amount necessary to
compensate for--
``(A) the conversion of highly erodible cropland
normally devoted to the production of an agricultural
commodity on a farm or ranch to a less intensive use;
and
``(B) the retirement of any cropland base and
allotment history that the owner or operator agrees to
retire permanently.
``SEC. 1234. <<NOTE: 16 USC 3834.>> PAYMENTS.
``(a) Timing.--The Secretary shall provide payment for obligations
incurred by the Secretary under a contract entered into under this
subchapter--
``(1) with respect to any cost-sharing payment obligation
incurred by the Secretary, as soon as practicable after the
obligation is incurred; and
``(2) with respect to any annual rental payment obligation
incurred by the Secretary--
``(A) as soon as practicable after October 1 of each
calendar year; or
[[Page 116 STAT. 246]]
``(B) at the option of the Secretary, at any time
prior to such date during the year that the obligation
is incurred.
``(b) Federal Percentage of Cost Sharing Payments.--
``(1) In general.--In making cost sharing payments to an
owner or operator under a contract entered into under this
subchapter, the Secretary shall pay 50 percent of the cost of
establishing water quality and conservation measures and
practices required under each contract for which the Secretary
determines that cost sharing is appropriate and in the public
interest.
``(2) Limitation.--The Secretary shall not make any payment
to an owner or operator under this subchapter to the extent that
the total amount of cost sharing payments provided to the owner
or operator from all sources would exceed 100 percent of the
total cost of establishing measures and practices described in
paragraph (1).
``(3) Hardwood trees, windbreaks, shelterbelts, and wildlife
corridors.--
``(A) Applicability.--This paragraph applies to--
``(i) land devoted to the production of
hardwood trees, windbreaks, shelterbelts, or
wildlife corridors under a contract entered into
under this subchapter after November 28, 1990; and
``(ii) land converted to such production under
section 1235A.
``(B) Payments.--In making cost share payments to an
owner or operator of land described in subparagraph (A),
the Secretary shall pay 50 percent of the reasonable and
necessary costs, as determined by the Secretary,
incurred by the owner or operator for maintaining trees
or shrubs, including the cost of replanting (if the
trees or shrubs were lost due to conditions beyond the
control of the owner or operator), during not less than
the 2-year, and not more than the 4-year, period
beginning on the date of the planting of the trees or
shrubs, as determined appropriate by the Secretary.
``(4) Hardwood tree planting.--The Secretary may permit
owners or operators that contract to devote at least 10 acres of
land to the production of hardwood trees under this subchapter
to extend the planting of the trees over a 3-year period if at
least \1/3\ of the trees are planted in each of the first 2
years.
``(5) Other federal cost share assistance.--An owner or
operator shall not be eligible to receive or retain cost share
assistance under this subsection if the owner or operator
receives any other Federal cost share assistance with respect to
the land under any other provision of law.
``(c) Annual Rental Payments.--
``(1) In general.--In determining the amount of annual
rental payments to be paid to owners and operators for
converting highly erodible cropland normally devoted to the
production of an agricultural commodity to less intensive use,
the Secretary may consider, among other things, the amount
necessary to encourage owners or operators of highly erodible
cropland to participate in the program established by this
subchapter.
[[Page 116 STAT. 247]]
``(2) Method of determination.--The amounts payable to
owners or operators in the form of rental payments under
contracts entered into under this subchapter may be determined
through--
``(A) the submission of bids for such contracts by
owners and operators in such manner as the Secretary may
prescribe; or
``(B) such other means as the Secretary determines
are appropriate.
``(3) Acceptance of contract offers.--In determining the
acceptability of contract offers, the Secretary may--
``(A) take into consideration the extent to which
enrollment of the land that is the subject of the
contract offer would improve soil resources, water
quality, wildlife habitat, or provide other
environmental benefits; and
``(B) establish different criteria in various States
and regions of the United States based on the extent to
which water quality or wildlife habitat may be improved
or erosion may be abated.
``(4) Hardwood tree acreage.--In the case of acreage
enrolled in the conservation reserve established under this
subchapter that is to be devoted to hardwood trees, the
Secretary may consider bids for contracts under this subsection
on a continuous basis.
``(d) Cash or In-Kind Payments.--
``(1) In general.--Except as otherwise provided in this
section, payments under this subchapter--
``(A) shall be made in cash or in commodities in
such amount and on such time schedule as is agreed on
and specified in the contract; and
``(B) may be made in advance of determination of
performance.
``(2) Method of providing in-kind payments.--If the payment
to an owner or operator is made with in-kind commodities, the
payment shall be made by the Commodity Credit Corporation--
``(A) by delivery of the commodity involved to the
owner or operator at a warehouse or other similar
facility located in the county in which the highly
erodible cropland is located or at such other location
as is agreed to by the Secretary and the owner or
operator;
``(B) by the transfer of negotiable warehouse
receipts; or
``(C) by such other method, including the sale of
the commodity in commercial markets, as is determined by
the Secretary to be appropriate to enable the owner or
operator to receive efficient and expeditious possession
of the commodity.
``(3) Cash payments.--
``(A) Commodity credit corporation stocks.--If
stocks of a commodity acquired by the Commodity Credit
Corporation are not readily available to make full
payment in kind to the owner or operator, the Secretary
may substitute full or partial payment in cash for
payment in kind.
``(B) Special conservation reserve enhancement
program.--Payments to an owner or operator under a
[[Page 116 STAT. 248]]
special conservation reserve enhancement program
described in subsection (f)(4) shall be in the form of
cash only.
``(e) Payments on Death, Disability, or Succession.--If an owner or
operator that is entitled to a payment under a contract entered into
under this subchapter dies, becomes incompetent, is otherwise unable to
receive the payment, or is succeeded by another person that renders or
completes the required performance, the Secretary shall make the
payment, in accordance with regulations prescribed by the Secretary and
without regard to any other provision of law, in such manner as the
Secretary determines is fair and reasonable in light of all of the
circumstances.
``(f) Payment Limitation for Rental Payments.--
``(1) In general.--The total amount of rental payments,
including rental payments made in the form of in-kind
commodities, made to a person under this subchapter for any
fiscal year may not exceed $50,000.
``(2) Regulations.--
``(A) In general.--The Secretary shall promulgate
regulations--
``(i) defining the term `person' as used in
this subsection; and
``(ii) providing such terms and conditions as
the Secretary determines necessary to ensure a
fair and reasonable application of the limitation
established by this subsection.
``(B) Corporations and stockholders.--The
regulations promulgated by the Secretary on December 18,
1970, under section 101 of the Agricultural Act of 1970
(7 U.S.C. 1307), shall be used to determine whether
corporations and their stockholders may be considered as
separate persons under this subsection.
``(3) Other payments.--Rental payments received by an owner
or operator shall be in addition to, and not affect, the total
amount of payments that the owner or operator is otherwise
eligible to receive under the Farm Security and Rural Investment
Act of 2002.
``(4) Special conservation reserve enhancement program.--
``(A) In general.--The provisions of this subsection
that limit payments to any person, and section 1305(d)
of the Agricultural Reconciliation Act of 1987 (7 U.S.C.
1308 note; Public Law 100-203), shall not be applicable
to payments received by a State, political subdivision,
or agency thereof in connection with agreements entered
into under a special conservation reserve enhancement
program carried out by that entity that has been
approved by the Secretary.
``(B) Agreements.--The Secretary may enter into such
agreements for payments to States (including political
subdivisions and agencies of States) that the Secretary
determines will advance the purposes of this subchapter.
``(g) Other State or Local Assistance.--In addition to any payment
under this subchapter, an owner or operator may receive cost share
assistance, rental payments, or tax benefits from a State or subdivision
thereof for enrolling land in the conservation reserve program.
[[Page 116 STAT. 249]]
``SEC. 1235. <<NOTE: 16 USC 3835.>> CONTRACTS.
``(a) Ownership or Operation Requirements.--
``(1) In general.--Except as provided in paragraph (2), no
contract shall be entered into under this subchapter concerning
land with respect to which the ownership has changed in the 1-
year period preceding the first year of the contract period
unless--
``(A) the new ownership was acquired by will or
succession as a result of the death of the previous
owner;
``(B) the new ownership was acquired before January
1, 1985;
``(C) the Secretary determines that the land was
acquired under circumstances that give adequate
assurance that the land was not acquired for the purpose
of placing the land in the program established by this
subchapter; or
``(D) the ownership change occurred due to
foreclosure on the land and the owner of the land
immediately before the foreclosure exercises a right of
redemption from the mortgage holder in accordance with
State law.
``(2) Exceptions.--Paragraph (1) shall not--
``(A) prohibit the continuation of an agreement by a
new owner after an agreement has been entered into under
this subchapter; or
``(B) require a person to own the land as a
condition of eligibility for entering into the contract
if the person--
``(i) has operated the land to be covered by a
contract under this section for at least 1 year
preceding the date of the contract or since
January 1, 1985, whichever is later; and
``(ii) controls the land for the contract
period.
``(b) Sales or Transfers.--If, during the term of a contract entered
into under this subchapter, an owner or operator of land subject to the
contract sells or otherwise transfers the ownership or right of
occupancy of the land, the new owner or operator of the land may--
``(1) continue the contract under the same terms or
conditions;
``(2) enter into a new contract in accordance with this
subchapter; or
``(3) elect not to participate in the program established by
this subchapter.
``(c) Modifications.--
``(1) In general.--The Secretary may modify a contract
entered into with an owner or operator under this subchapter
if--
``(A) the owner or operator agrees to the
modification; and
``(B) the Secretary determines that the modification
is desirable--
``(i) to carry out this subchapter;
``(ii) to facilitate the practical
administration of this subchapter; or
``(iii) to achieve such other goals as the
Secretary determines are appropriate, consistent
with this subchapter.
[[Page 116 STAT. 250]]
``(2) Production of agricultural commodities.--The Secretary
may modify or waive a term or condition of a contract entered
into under this subchapter in order to permit all or part of the
land subject to such contract to be devoted to the production of
an agricultural commodity during a crop year, subject to such
conditions as the Secretary determines are appropriate.
``(d) Termination.--
``(1) In general.--The Secretary may terminate a contract
entered into with an owner or operator under this subchapter
if--
``(A) the owner or operator agrees to the
termination; and
``(B) the Secretary determines that the termination
would be in the public interest.
``(2) Notice to congressional committees.--At least 90 days
before taking any action to terminate under paragraph (1) all
conservation reserve contracts entered into under this
subchapter, the Secretary shall provide to the Committee on
Agriculture of the House of Representatives and the Committee on
Agriculture, Nutrition, and Forestry of the Senate written
notice of the action.
``(e) Early Termination by Owner or Operator.--
``(1) Early termination.--
``(A) In general.--The Secretary shall allow a
participant that entered into a contract under this
subchapter before January 1, 1995, to terminate the
contract at any time if the contract has been in effect
for at least 5 years.
``(B) Liability for contract violation.--The
termination shall not relieve the participant of
liability for a contract violation occurring before the
date of the termination.
``(C) Notice to secretary.--The participant shall
provide the Secretary with reasonable notice of the
desire of the participant to terminate the contract.
``(2) Certain land excepted.--The following land 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 land of high environmental value
(including wetland), 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)(C).
``(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.
``(5) Renewed enrollment.--The termination of a contract
entered into under this subchapter shall not affect the ability
of the owner or operator that requested the termination to
submit a subsequent bid to enroll the land that was subject to
the contract into the conservation reserve.
[[Page 116 STAT. 251]]
``(6) Conservation requirements.--If land that was subject
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 land in the area, except that the requirements may not
be more onerous than the requirements imposed on other land.
``SEC. 1235A. <<NOTE: 16 USC 3835a.>> CONVERSION OF LAND SUBJECT TO
CONTRACT TO OTHER CONSERVING USES.
``(a) Conversion to Trees.--
``(1) In general.--The Secretary shall permit an owner or
operator that has entered into a contract under this subchapter
that is in effect on November 28, 1990, to convert areas of
highly erodible cropland that are subject to the contract, and
that are devoted to vegetative cover, from that use to hardwood
trees, windbreaks, shelterbelts, or wildlife corridors.
``(2) Terms.--
``(A) Extension of contract.--With respect to a
contract that is modified under this section that
provides for the planting of hardwood trees, windbreaks,
shelterbelts, or wildlife corridors, if the original
term of the contract was less than 15 years, the owner
or operator may extend the contract to a term of not to
exceed 15 years.
``(B) Cost share assistance.--The Secretary shall
pay 50 percent of the cost of establishing conservation
measures and practices authorized under this subsection
for which the Secretary determines the cost sharing is
appropriate and in the public interest.
``(b) Conversion to Wetland.--The Secretary shall permit an owner or
operator that has entered into a contract under this subchapter that is
in effect on November 28, 1990, to restore areas of highly erodible
cropland that are devoted to vegetative cover under the contract to
wetland if--
``(1) the areas are prior converted wetland;
``(2) the owner or operator of the areas enters into an
agreement to provide the Secretary with a long-term or permanent
easement under subchapter C covering the areas;
``(3) there is a high probability that the prior converted
area can be successfully restored to wetland status; and
``(4) the restoration of the areas otherwise meets the
requirements of subchapter C.
``(c) Limitation.--The Secretary shall not incur, through a
conversion under this section, any additional expense on the acres,
including the expense involved in the original establishment of the
vegetative cover, that would result in cost share for costs under this
section in excess of the costs that would have been subject to cost
share for the new practice had that practice been the original practice.
``(d) Condition of Contract.--An owner or operator shall as a
condition of entering into a contract under subsection (a) participate
in the Forest Stewardship Program established under section 5 of the
Cooperative Forestry Assistance Act of 1978 (16 U.S.C. 2103a).''.
[[Page 116 STAT. 252]]
(b) Study <<NOTE: 16 USC 3831 note.>> on Economic Effects.--
(1) In general.--Not later than 18 months after the date of
enactment of this Act, the Secretary of Agriculture shall submit
to the Committee on Agriculture of the House of Representatives
and the Committee on Agriculture, Nutrition, and Forestry of the
Senate a report that describes the economic and social effects
on rural communities resulting from the conservation reserve
program established under subchapter B of chapter 1 of subtitle
D of title XII of the Food Security Act of 1985 (16 U.S.C. 3831
et seq.).
(2) Components.--The study under paragraph (1) shall include
analyses of--
(A) the impact that enrollments in the conservation
reserve program have on rural businesses, civic
organizations, and community services (such as schools,
public safety, and infrastructure), particularly in
communities with a large percentage of whole farm
enrollments;
(B) the effect that those enrollments have on rural
population and beginning farmers (including a
description of any connection between the rate of
enrollment and the incidence of absentee ownership);
(C)(i) the manner in which differential per acre
payment rates potentially impact the types of land (by
productivity) enrolled;
(ii) changes to the per acre payment rates that may
affect that impact; and
(iii) the manner in which differential per acre
payment rates could facilitate retention of productive
agricultural land in agriculture; and
(D) the effect of enrollment on opportunities for
recreational activities (including hunting and fishing).
Subtitle C--Wetlands Reserve Program
SEC. 2201. REAUTHORIZATION.
Section 1237(c) of the Food Security Act of 1985 (16 U.S.C. 3837(c))
is amended by striking ``2002'' and inserting ``2007''.
SEC. 2202. ENROLLMENT.
Section 1237 of the Food Security Act of 1985 (16 U.S.C. 3837) is
amended--
(1) 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
2,275,000 acres, of which, to the maximum extent practicable,
the Secretary shall enroll 250,000 acres in each calendar year.
``(2) Methods of enrollment.--The Secretary shall enroll
acreage into the wetlands reserve program through the use of
permanent easements, 30-year easements, restoration cost share
agreements, or any combination of those options.''; and
(2) by striking subsection (g).
SEC. 2203. EASEMENTS AND AGREEMENTS.
Section 1237A of the Food Security Act of 1985 (16 U.S.C. 3837a) is
amended by striking subsection (h).
[[Page 116 STAT. 253]]
SEC. 2204. CHANGES IN OWNERSHIP; AGREEMENT MODIFICATION; TERMINATION.
Section 1237E(a) of the Food Security Act of 1985 (16 U.S.C.
3837e(a)) is amended by striking paragraph (2) and inserting the
following:
``(2)(A) the ownership change occurred because of
foreclosure on the land; and
``(B) immediately before the foreclosure, the owner of the
land exercises a right of redemption from the mortgage holder in
accordance with State law; or''.
Subtitle D--Environmental Quality Incentives
SEC. 2301. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.
Chapter 4 of subtitle D of title XII of the Food Security Act of
1985 (16 U.S.C. 3839aa et seq.) is amended to read as follows:
``SEC. 1240. <<NOTE: 16 USC 3839aa.>> PURPOSES.
``The purposes of the environmental quality incentives program
established by this chapter are to promote agricultural production and
environmental quality as compatible goals, and to optimize environmental
benefits, by--
``(1) assisting producers in complying with local, State,
and national regulatory requirements concerning--
``(A) soil, water, and air quality;
``(B) wildlife habitat; and
``(C) surface and ground water conservation;
``(2) avoiding, to the maximum extent practicable, the need
for resource and regulatory programs by assisting producers in
protecting soil, water, air, and related natural resources and
meeting environmental quality criteria established by Federal,
State, tribal, and local agencies;
``(3) providing flexible assistance to producers to install
and maintain conservation practices that enhance soil, water,
related natural resources (including grazing land and wetland),
and wildlife while sustaining production of food and fiber;
``(4) assisting producers to make beneficial, cost effective
changes to cropping systems, grazing management, nutrient
management associated with livestock, pest or irrigation
management, or other practices on agricultural land; and
``(5) consolidating and streamlining conservation planning
and regulatory compliance processes to reduce administrative
burdens on producers and the cost of achieving environmental
goals.
``SEC. 1240A. <<NOTE: 16 USC 3839aa-1.>> DEFINITIONS.
``In this chapter:
``(1) Beginning farmer or rancher.--The term `beginning
farmer or rancher' has the meaning provided under section 343(a)
of the Consolidated Farm and Rural Development Act (7 U.S.C.
1999(a)).
``(2) Eligible land.--
``(A) In general.--The term `eligible land' means
land on which agricultural commodities or livestock are
produced.
[[Page 116 STAT. 254]]
``(B) Inclusions.--The term `eligible land'
includes--
``(i) cropland;
``(ii) grassland;
``(iii) rangeland;
``(iv) pasture land;
``(v) private, nonindustrial forest land; and
``(vi) other agricultural land that the
Secretary determines poses a serious threat to
soil, air, water, or related resources.
``(3) Land management practice.--The term `land management
practice' means a site-specific nutrient or manure management,
integrated pest management, irrigation management, tillage or
residue management, grazing management, air quality management,
or other land management practice carried out on eligible land
that the Secretary determines is needed to protect from
degradation, in the most cost-effective manner, water, soil, or
related resources.
``(4) Livestock.--The term `livestock' means dairy cattle,
beef cattle, laying hens, broilers, turkeys, swine, sheep, and
other such animals as are determined by the Secretary.
``(5) Practice.--The term `practice' means 1 or more
structural practices, land management practices, and
comprehensive nutrient management planning practices.
``(6) Structural practice.--The term `structural practice'
means--
``(A) the establishment on eligible land of a site-
specific animal waste management facility, terrace,
grassed waterway, contour grass strip, filterstrip,
tailwater pit, permanent wildlife habitat, constructed
wetland, 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.
``SEC. 1240B. <<NOTE: 16 USC 3839aa-2.>> ESTABLISHMENT AND
ADMINISTRATION OF ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.
``(a) Establishment.--
``(1) In general.--During each of the 2002 through 2007
fiscal years, the Secretary shall provide cost-share payments
and incentive payments to producers that enter into contracts
with the Secretary under the program.
``(2) Eligible practices.--With respect to practices
implemented under this chapter--
``(A) a producer that implements a structural
practice in accordance with this chapter shall be
eligible to receive cost-share payments; and
``(B) a producer that implements a land management
practice, or develops a comprehensive nutrient
management plan, in accordance with this chapter shall
be eligible to receive incentive payments.
``(b) Practices and Term.--
``(1) Practices.--A contract under this chapter may apply to
1 or more structural practices, land management practices, and
comprehensive nutrient management practices.
``(2) Term.--A contract under this chapter shall have a term
that--
[[Page 116 STAT. 255]]
``(A) at a minimum, is equal to the period beginning
on the date on which the contract is entered into and
ending on the date that is 1 year after the date on
which all practices under the contract have been
implemented; but
``(B) not to exceed 10 years.
``(c) Bidding Down.--If the Secretary determines that the
environmental values of 2 or more applications for cost-share payments
or incentive payments are comparable, the Secretary shall not assign a
higher priority to the application only because it would present the
least cost to the program established under the program.
``(d) Cost-Share Payments.--
``(1) In general.--Except as provided in paragraph (2), the
cost-share payments provided to a producer proposing to
implement 1 or more practices under the program shall be not
more than 75 percent of the cost of the practice, as determined
by the Secretary.
``(2) Exceptions.--
``(A) Limited resource and beginning farmers.--The
Secretary may increase the amount provided to a producer
under paragraph (1) to not more than 90 percent if the
producer is a limited resource or beginning farmer or
rancher, as determined by the Secretary.
``(B) Cost-share assistance from other sources.--
Except as provided in paragraph (3), any cost-share
payments received by a producer from a State or private
organization or person for the implementation of 1 or
more practices on eligible land of the producer shall be
in addition to the payments provided to the producer
under paragraph (1).
``(3) Other payments.--A producer shall not be eligible for
cost-share payments for practices on eligible land under the
program if the producer receives cost-share payments or other
benefits for the same practice on the same land under chapter 1
and the program.
``(e) Incentive Payments.--
``(1) In general.--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.
``(2) Special rule.--In determining the amount and rate of
incentive payments, the Secretary may accord great significance
to a practice that promotes residue, nutrient, pest, invasive
species, or air quality management.
``(f) Modification or Termination of Contracts.--
``(1) Voluntary modification or termination.--The Secretary
may modify or terminate a contract entered into with a producer
under this chapter if--
``(A) the producer agrees to the modification or
termination; 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 determines that
the producer violated the contract.
[[Page 116 STAT. 256]]
``(g) Allocation of Funding.--For each of fiscal years 2002 through
2007, 60 percent of the funds made available for cost-share payments and
incentive payments under this chapter shall be targeted at practices
relating to livestock production.
``SEC. 1240C. <<NOTE: 16 USC 3839aa-3.>> EVALUATION OF OFFERS AND
PAYMENTS.
``In evaluating applications for cost-share payments and incentive
payments, the Secretary shall accord a higher priority to assistance and
payments that--
``(1) encourage the use by producers of cost-effective
conservation practices; and
``(2) address national conservation priorities.
``SEC. 1240D. <<NOTE: 16 USC 3839aa-4.>> DUTIES OF PRODUCERS.
``To receive technical assistance, cost-share payments, or incentive
payments under the program, a producer shall agree--
``(1) to implement an environmental quality incentives
program plan (including a comprehensive nutrient management
plan, if applicable) that describes conservation and
environmental purposes to be achieved through 1 or more
practices that are approved by the Secretary;
``(2) not to conduct any practices on the farm or ranch that
would tend to defeat the purposes of the program;
``(3) on the violation of a term or condition of the
contract at anytime the producer has control of the land--
``(A) if the Secretary determines that the violation
warrants termination of the contract--
``(i) to forfeit all rights to receive
payments under the contract; and
``(ii) to refund to the Secretary all or a
portion of the payments received by the owner or
operator under the contract, including any
interest on the payments, as determined by the
Secretary; or
``(B) if the Secretary determines that the violation
does not warrant termination of the contract, to refund
to the Secretary, or accept adjustments to, the payments
provided to the owner or operator, as the Secretary
determines to be appropriate;
``(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
payments and incentive payments received under the program, as
determined by the Secretary;
``(5) to supply information as required by the Secretary to
determine compliance with the program plan and requirements of
the program; and
``(6) to comply with such additional provisions as the
Secretary determines are necessary to carry out the program
plan.
``SEC. 1240E. <<NOTE: 16 USC 3839aa-5.>> ENVIRONMENTAL QUALITY
INCENTIVES PROGRAM PLAN.
``(a) In General.--To be eligible to receive cost-share payments or
incentive payments under the program, a producer shall submit to the
Secretary for approval a plan of operations that--
``(1) specifies practices covered under the program;
``(2) includes such terms and conditions as the Secretary
considers necessary to carry out the program, including a
[[Page 116 STAT. 257]]
description of the purposes to be met by the implementation of
the plan; and
``(3) in the case of a confined livestock feeding operation,
provides for development and implementation of a comprehensive
nutrient management plan, if applicable.
``(b) Avoidance of Duplication.--The Secretary shall, to the maximum
extent practicable, eliminate duplication of planning activities under
the program under this chapter and comparable conservation programs.
``SEC. 1240F. <<NOTE: 16 USC 3839aa-6.>> DUTIES OF THE SECRETARY.
``To the extent appropriate, the Secretary shall assist a producer
in achieving the conservation and environmental goals of a program plan
by--
``(1) providing cost-share payments or incentive payments
for developing and implementing 1 or more practices, as
appropriate; and
``(2) providing the producer with information and training
to aid in implementation of the plan.
``SEC. 1240G. <<NOTE: 16 USC 3839aa-7.>> LIMITATION ON PAYMENTS.
``An individual or entity may not receive, directly or indirectly,
cost-share or incentive payments under this chapter that, in the
aggregate, exceed $450,000 for all contracts entered into under this
chapter by the individual or entity during the period of fiscal years
2002 through 2007, regardless of the number of contracts entered into
under this chapter by the individual or entity.
``SEC. 1240H. <<NOTE: 16 USC 3839aa-8.>> CONSERVATION INNOVATION GRANTS.
``(a) In General.--The Secretary may pay the cost of competitive
grants that are intended to stimulate innovative approaches to
leveraging Federal investment in environmental enhancement and
protection, in conjunction with agricultural production, through the
program.
``(b) Use.--The Secretary may provide grants under this section to
governmental and nongovernmental organizations and persons, on a
competitive basis, to carry out projects that--
``(1) involve producers that are eligible for payments or
technical assistance under the program;
``(2) implement projects, such as--
``(A) market systems for pollution reduction; and
``(B) innovative conservation practices, including
the storing of carbon in the soil; and
``(3) leverage funds made available to carry out the program
under this chapter with matching funds provided by State and
local governments and private organizations to promote
environmental enhancement and protection in conjunction with
agricultural production.
``(c) Cost Share.--The amount of a grant made under this section to
carry out a project shall not exceed 50 percent of the cost of the
project.
``SEC. 1240I. <<NOTE: 16 USC 3839aa-9.>> GROUND AND SURFACE WATER
CONSERVATION.
``(a) Establishment.--In carrying out the program under this
chapter, subject to subsection (b), the Secretary shall promote ground
and surface water conservation by providing cost-share payments,
incentive payments, and loans to producers to carry out
[[Page 116 STAT. 258]]
eligible water conservation activities with respect to the agricultural
operations of producers, to--
``(1) improve irrigation systems;
``(2) enhance irrigation efficiencies;
``(3) convert to--
``(A) the production of less water-intensive
agricultural commodities; or
``(B) dryland farming;
``(4) improve the storage of water through measures such as
water banking and groundwater recharge;
``(5) mitigate the effects of drought; or
``(6) institute other measures that improve groundwater and
surface water conservation, as determined by the Secretary, in
the agricultural operations of producers.
``(b) Net Savings.--The Secretary may provide assistance to a
producer under this section only if the Secretary determines that the
assistance will facilitate a conservation measure that results in a net
savings in groundwater or surface water resources in the agricultural
operation of the producer.
``(c) Funding.--Of the funds of the Commodity Credit Corporation, in
addition to amounts made available under section 1241(a)(6) to carry out
this chapter, the Secretary shall use--
``(1) to carry out this section--
``(A) $25,000,000 for fiscal year 2002;
``(B) $45,000,000 for fiscal year 2003; and
``(C) $60,000,000 for each of fiscal years 2004
through 2007; and
``(2) $50,000,000 to carry out water conservation activities
in Klamath Basin, California and Oregon, to be made available as
soon as practicable after the date of enactment of this
section.''.
Subtitle E--Grassland Reserve
SEC. 2401. GRASSLAND RESERVE PROGRAM.
Chapter 2 of the Food Security Act of 1985 (as amended by section
2001) is amended by adding at the end the following:
``Subchapter C--Grassland Reserve Program
``SEC. 1238N. <<NOTE: 16 USC 3838n.>> GRASSLAND RESERVE PROGRAM.
``(a) Establishment.--The Secretary shall establish a grassland
reserve program (referred to in this subchapter as the `program') to
assist owners in restoring and conserving eligible land described in
subsection (c).
``(b) Enrollment Conditions.--
``(1) Maximum enrollment.--The total number of acres
enrolled in the program shall not exceed 2,000,000 acres of
restored or improved grassland, rangeland, and pastureland.
``(2) Methods of enrollment.--
``(A) In general.--Except as provided in
subparagraph (B), the Secretary shall enroll in the
program from a willing owner not less than 40 contiguous
acres of land through the use of--
``(i) a 10-year, 15-year, or 20-year rental
agreement;
[[Page 116 STAT. 259]]
``(ii)(I) a 30-year rental agreement or
permanent or 30-year easement; or
``(II) in a State that imposes a maximum
duration for easements, an easement for the
maximum duration allowed under State law.
``(B) Waiver.--The Secretary may enroll in the
program such parcels of land that are less than 40 acres
as the Secretary determines are appropriate to achieve
the purposes of the program.
``(3) Limitation on use of easements and rental
agreements.--Of the total amount of funds expended under the
program to acquire easements and rental agreements described in
paragraph (2)(A)--
``(A) not more than 40 percent shall be used for
rental agreements described in paragraph (2)(A)(i); and
``(B) not more than 60 percent shall be used for
easements and rental agreements described in paragraph
(2)(A)(ii).
``(c) Eligible Land.--Land shall be eligible to be enrolled in the
program if the Secretary determines that the land is private land that
is--
``(1) grassland, land that contains forbs, or shrubland
(including improved rangeland and pastureland); or
``(2) land that--
``(A) is located in an area that has been
historically dominated by grassland, forbs, or
shrubland; and
``(B) has potential to serve as habitat for animal
or plant populations of significant ecological value if
the land is--
``(i) retained in the current use of the land;
or
``(ii) restored to a natural condition; or
``(3) land that is incidental to land described in paragraph
(1) or (2), if the incidental land is determined by the
Secretary to be necessary for the efficient administration of an
agreement or easement.
``SEC. 1238O. <<NOTE: 16 USC 3838o.>> REQUIREMENTS RELATING TO
EASEMENTS AND AGREEMENTS.
``(a) Requirements of Landowner.--
``(1) In general.--To be eligible to enroll land in the
program through the grant of an easement, the owner of the land
shall enter into an agreement with the Secretary--
``(A) to grant an easement that applies to the land
to the Secretary;
``(B) to create and record an appropriate deed
restriction in accordance with applicable State law to
reflect the easement;
``(C) to provide a written statement of consent to
the easement signed by persons holding a security
interest or any vested interest in the land;
``(D) to provide proof of unencumbered title to the
underlying fee interest in the land that is the subject
of the easement; and
``(E) to comply with the terms of the easement and
restoration agreement.
[[Page 116 STAT. 260]]
``(2) Agreements.--To be eligible to enroll land in the
program under an agreement, the owner or operator of the land
shall agree--
``(A) to comply with the terms of the agreement
(including any related restoration agreements); and
``(B) to the suspension of any existing cropland
base and allotment history for the land under a program
administered by the Secretary.
``(b) Terms of Easement or Rental Agreement.--An easement or rental
agreement under subsection (a) shall--
``(1) permit--
``(A) common grazing practices, including
maintenance and necessary cultural practices, on the
land in a manner that is consistent with maintaining the
viability of grassland, forb, and shrub species common
to that locality;
``(B) subject to appropriate restrictions during the
nesting season for birds in the local area that are in
significant decline or are conserved in accordance with
Federal or State law, as determined by the Natural
Resources Conservation Service State conservationist,
haying, mowing, or harvesting for seed production; and
``(C) fire rehabilitation and construction of fire
breaks and fences (including placement of the posts
necessary for fences);
``(2) prohibit--
``(A) the production of crops (other than hay),
fruit trees, vineyards, or any other agricultural
commodity that requires breaking the soil surface; and
``(B) except as permitted under this subsection or
subsection (d), the conduct of any other activity that
would disturb the surface of the land covered by the
easement or rental agreement; and
``(3) include such additional provisions as the Secretary
determines are appropriate to carry out or facilitate the
administration of this subchapter.
``(c) Evaluation and Ranking of Easement and Rental Agreement
Applications.--
``(1) In general.--The Secretary shall establish criteria to
evaluate and rank applications for easements and rental
agreements under this subchapter.
``(2) Considerations.--In establishing the criteria, the
Secretary shall emphasize support for--
``(A) grazing operations;
``(B) plant and animal biodiversity; and
``(C) grassland, land that contains forbs, and
shrubland under the greatest threat of conversion.
``(d) Restoration Agreements.--
``(1) In general.--The Secretary shall prescribe the terms
of a restoration agreement by which grassland, land that
contains forbs, or shrubland that is subject to an easement or
rental agreement entered into under the program shall be
restored.
``(2) Requirements.--The restoration agreement shall
describe the respective duties of the owner and the Secretary
(including the Federal share of restoration payments and
technical assistance).
[[Page 116 STAT. 261]]
``(e) Violations.--On a violation of the terms or conditions of an
easement, rental agreement, or restoration agreement entered into under
this section--
``(1) the easement or rental agreement shall remain in
force; and
``(2) the Secretary may require the owner to refund all or
part of any payments received by the owner under this
subchapter, with interest on the payments as determined
appropriate by the Secretary.
``SEC. 1238P. <<NOTE: 16 USC 3838p.>> DUTIES OF SECRETARY.
``(a) In general.--In return for the granting of an easement, or the
execution of a rental agreement, by an owner under this subchapter, the
Secretary shall, in accordance with this section--
``(1) make easement or rental agreement payments to the
owner in accordance with subsection (b); and
``(2) make payments to the owner for the Federal share of
the cost of restoration in accordance with subsection (c).
``(b) Payments.--
``(1) Easement payments.--
``(A) Amount.--In return for the granting of an
easement by an owner under this subchapter, the
Secretary shall make easement payments to the owner in
an amount equal to--
``(i) in the case of a permanent easement, the
fair market value of the land less the grazing
value of the land encumbered by the easement; and
``(ii) in the case of a 30-year easement or an
easement for the maximum duration allowed under
applicable State law, 30 percent of the fair
market value of the land less the grazing value of
the land for the period during which the land is
encumbered by the easement.
``(B) Schedule.--Easement payments may be provided
in not less than 1 payment nor more than 10 annual
payments of equal or unequal amount, as agreed to by the
Secretary and the owner.
``(2) Rental agreement payments.--In return for entering
into a rental agreement by an owner under this subchapter, the
Secretary shall make annual payments to the owner during the
term of the rental agreement in an amount that is not more than
75 percent of the grazing value of the land covered by the
contract.
``(c) Federal Share of Restoration.--The Secretary shall make
payments to an owner under this section of not more than--
``(1) in the case of grassland, land that contains forbs, or
shrubland that has never been cultivated, 90 percent of the
costs of carrying out measures and practices necessary to
restore functions and values of that land; or
``(2) in the case of restored grassland, land that contains
forbs, or shrubland, 75 percent of those costs.
``(d) Payments to Others.--If an owner that is entitled to a payment
under this subchapter dies, becomes incompetent, is otherwise unable to
receive the payment, or is succeeded by another person who renders or
completes the required performance, the Secretary shall make the
payment, in accordance with regulations promulgated by the Secretary and
without regard to any other
[[Page 116 STAT. 262]]
provision of law, in such manner as the Secretary determines is fair and
reasonable in light of all the circumstances.
``SEC. 1238Q. <<NOTE: 16 USC 3838q.>> DELEGATION TO PRIVATE
ORGANIZATIONS.
``(a) In General.--The Secretary may permit a private conservation
or land trust organization (referred to in this section as a `private
organization') or a State agency to hold and enforce an easement under
this subchapter, in lieu of the Secretary, subject to the right of the
Secretary to conduct periodic inspections and enforce the easement, if--
``(1) the Secretary determines that granting the permission
will promote protection of grassland, land that contains forbs,
and shrubland;
``(2) the owner authorizes the private organization or State
agency to hold and enforce the easement; and
``(3) the private organization or State agency agrees to
assume the costs incurred in administering and enforcing the
easement, including the costs of restoration or rehabilitation
of the land as specified by the owner and the private
organization or State agency.
``(b) Application.--A private organization or State agency that
seeks to hold and enforce an easement under this subchapter shall apply
to the Secretary for approval.
``(c) Approval by Secretary.--The Secretary may approve a private
organization to hold and enforce an easement under this subchapter if
(as determined by the Secretary) the private organization--
``(1)(A) is an organization described in section 501(c)(3)
of the Internal Revenue Code of 1986 that is exempt from
taxation under section 501(a) of that Code; or
``(B) is described in section 509(a)(3), and is controlled
by an organization described in section 509(a)(2), of that Code;
``(2) has the relevant experience necessary to administer
grassland and shrubland easements;
``(3) has a charter that describes the commitment of the
private organization to conserving ranchland, agricultural land,
or grassland for grazing and conservation purposes; and
``(4) has the resources necessary to effectuate the purposes
of the charter.
``(d) Reassignment.--
``(1) In general.--If a private organization holding an
easement on land under this subchapter terminates, not later
than 30 days after termination of the private organization, the
owner of the land shall reassign the easement to--
``(A) a new private organization that is approved by
the Secretary; or
``(B) the Secretary.
``(2) Notification of secretary.--
``(A) In general.--If <<NOTE: Deadline.>> the
easement is reassigned to a new private organization,
not later than 60 days after the date of reassignment,
the owner and the new organization shall notify the
Secretary in writing that a reassignment for termination
has been made.
``(B) Failure to notify.--If the owner and the new
organization fail to notify the Secretary of the
reassignment in accordance with subparagraph (A), the
easement shall revert to the control of the
Secretary.''.
[[Page 116 STAT. 263]]
Subtitle F--Other Conservation Programs
SEC. 2501. AGRICULTURAL MANAGEMENT ASSISTANCE.
Section 524 of the Federal Crop Insurance Act (7 U.S.C. 1524) is
amended by striking subsection (b) and inserting the following:
``(b) Agricultural Management Assistance.--
``(1) Authority.--The Secretary shall provide financial
assistance to producers in the States of Connecticut, Delaware,
Maryland, Massachusetts, Maine, Nevada, New Hampshire, New
Jersey, New York, Pennsylvania, Rhode Island, Utah, Vermont,
West Virginia, and Wyoming.
``(2) Uses.--A producer may use financial assistance
provided under this subsection to--
``(A) construct or improve--
``(i) watershed management structures; or
``(ii) irrigation structures;
``(B) plant trees to form windbreaks or to improve
water quality;
``(C) mitigate financial risk through production or
marketing diversification or resource conservation
practices, including--
``(i) soil erosion control;
``(ii) integrated pest management;
``(iii) organic farming; or
``(iv) to develop and implement a plan to
create marketing opportunities for the producer,
including through value-added processing;
``(D) enter into futures, hedging, or options
contracts in a manner designed to help reduce
production, price, or revenue risk;
``(E) enter into agricultural trade options as a
hedging transaction to reduce production, price, or
revenue risk; or
``(F) conduct any other activity relating to an
activity described in subparagraphs (A) through (E), as
determined by the Secretary.
``(3) Payment limitation.--The total amount of payments made
to a person (as defined in section 1001(5) of the Food Security
Act (7 U.S.C. 1308(5))) under this subsection for any year may
not exceed $50,000.
``(4) Commodity credit corporation.--
``(A) In general.--The Secretary shall carry out
this subsection through the Commodity Credit
Corporation.
``(B) Funding.--
``(i) In general.--Except as provided in
clause (ii), the Commodity Credit Corporation
shall make available to carry out this subsection
not less than $10,000,000 for each fiscal year.
``(ii) Exception.--For each of fiscal years
2003 through 2007, the Commodity Credit
Corporation shall make available to carry out this
subsection $20,000,000.''.
[[Page 116 STAT. 264]]
SEC. 2502. GRAZING, WILDLIFE HABITAT INCENTIVE, SOURCE WATER PROTECTION,
AND GREAT LAKES BASIN PROGRAMS.
(a) In General.--Chapter 5 of subtitle D of title XII of the Food
Security Act of 1985 (16 U.S.C. 3839bb et seq.) is amended to read as
follows:
``CHAPTER 5--OTHER CONSERVATION PROGRAMS
``SEC. 1240M. <<NOTE: 16 USC 3839bb.>> CONSERVATION OF PRIVATE GRAZING
LAND.
``(a) 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
assistance 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
systems through grazing land conservation 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.
``(b) 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.
``(c) 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
local conservation districts, to enable the landowners,
managers, 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
technologies;
``(C) managing resources on private grazing land,
including--
[[Page 116 STAT. 265]]
``(i) planning, managing, and treating private
grazing 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 land;
``(H) identifying the opportunities and encouraging
the diversification of private grazing land enterprises;
and
``(I) encouraging the use of sustainable grazing
systems, such as year-round, rotational, or managed
grazing.
``(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.--Personnel
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.
``(d) Grazing Technical Assistance Self-Help.--
``(1) Findings.--Congress finds that--
``(A) there is a severe lack of technical assistance
for farmers and ranchers that graze livestock;
``(B) Federal budgetary constraints preclude any
significant expansion, and may force a reduction of,
current levels of technical support; and
``(C) farmers and ranchers have a history of
cooperatively 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 recommendation of the
grazing land conservation initiative steering committee.
``(3) Procedure.--
``(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
proposal if the Secretary determines that the proposal--
[[Page 116 STAT. 266]]
``(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 April 4, 1996.
``(D) Area included.--The area proposed to be
included in a grazing management district shall be
determined by the Secretary on the basis of an
application 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 demonstration basis, a grazing management
district.
``(F) Activities.--The activities of a grazing
management district shall be scientifically sound
activities, as determined by the Secretary in
consultation with a technical advisory committee
composed of ranchers, farmers, and technical experts.
``(e) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $60,000,000 for each of fiscal
years 2002 through 2007.
``SEC. 1240N. <<NOTE: 16 USC 3839bb-1.>> WILDLIFE HABITAT INCENTIVE
PROGRAM.
``(a) In General.--The <<NOTE: Establishment.>> Secretary, in
consultation with the State technical committees established under
section 1261, shall establish within the Natural Resources Conservation
Service a program to be known as the wildlife habitat incentive program
(referred to in this section as the `program').
``(b) Cost-Share Payments.--
``(1) In general.--Under the program, the Secretary shall
make cost-share payments to landowners to develop--
``(A) upland wildlife habitat;
``(B) wetland wildlife habitat;
``(C) habitat for threatened and endangered species;
``(D) fish habitat; and
``(E) other types of wildlife habitat approved by
the Secretary.
``(2) Increased cost share for long-term agreements.--
``(A) In general.--In a case in which the Secretary
enters into an agreement or contract to protect and
restore plant and animal habitat that has a term of at
least 15 years, the Secretary may provide cost-share
payments in addition to amounts provided under paragraph
(1).
``(B) Funding limitation.--The Secretary may use,
for a fiscal year, not more than 15 percent of funds
made available under section 1241(a)(7) for the fiscal
year to carry out contracts and agreements described in
subparagraph (A).
``(c) Regional Equity.--In carrying out this section, the Secretary
shall, to the maximum extent practicable, ensure that regional issues of
concern relating to wildlife habitat are addressed in an appropriate
manner.
[[Page 116 STAT. 267]]
``SEC. 1240O. <<NOTE: 16 USC 3839bb-2.>> GRASSROOTS SOURCE WATER
PROTECTION PROGRAM.
``(a) In General.--The Secretary shall establish a national
grassroots water protection program to more effectively use onsite
technical assistance capabilities of each State rural water association
that, as of the date of enactment of this section, operates a wellhead
or groundwater protection program in the State.
``(b) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $5,000,000 for each of fiscal
years 2002 through 2007.
``SEC. 1240P. <<NOTE: 16 USC 3839bb-3.>> GREAT LAKES BASIN PROGRAM FOR
SOIL EROSION AND SEDIMENT CONTROL.
``(a) In General.--The Secretary, in consultation with the Great
Lakes Commission created by Article IV of the Great Lakes Basin Compact
(82 Stat. 415) and in cooperation with the Administrator of the
Environmental Protection Agency and the Secretary of the Army, may carry
out the Great Lakes basin program for soil erosion and sediment control
(referred to in this section as the `program').
``(b) Assistance.--In carrying out the program, the Secretary may--
``(1) provide project demonstration grants, provide
technical assistance, and carry out information and education
programs to improve water quality in the Great Lakes basin by
reducing soil erosion and improving sediment control; and
``(2) provide a priority for projects and activities that
directly reduce soil erosion or improve sediment control.
``(c) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $5,000,000 for each of fiscal
years 2002 through 2007.''.
(b) Conforming Amendment.--Sections 386 and 387 of the Federal
Agriculture Improvement and Reform Act of 1996 (16 U.S.C. 2005b, 3836a)
are repealed.
SEC. 2503. FARMLAND PROTECTION PROGRAM.
(a) In General.--Chapter 2 of the Food Security Act of 1985 (as
amended by section 2001) is amended by adding at the end the following:
``Subchapter B--Farmland Protection Program
``SEC. 1238H. <<NOTE: 16 USC 3838h.>> DEFINITIONS.
``In this subchapter:
``(1) Eligible entity.--The term `eligible entity' means--
``(A) any agency of any State or local government or
an Indian tribe (including a farmland protection board
or land resource council established under State law);
or
``(B) any organization that--
``(i) is organized for, and at all times since
the formation of the organization has been
operated principally for, 1 or more of the
conservation purposes specified in clause (i),
(ii), (iii), or (iv) of section 170(h)(4)(A) of
the Internal Revenue Code of 1986;
``(ii) is an organization described in section
501(c)(3) of that Code that is exempt from
taxation under section 501(a) of that Code;
[[Page 116 STAT. 268]]
``(iii) is described in section 509(a)(2) of
that Code; or
``(iv) is described in section 509(a)(3), and
is controlled by an organization described in
section 509(a)(2), of that Code.
``(2) Eligible land.--
``(A) In general.--The term `eligible land' means
land on a farm or ranch that--
``(i)(I) has prime, unique, or other
productive soil; or
``(II) contains historical or archaeological
resources; and
``(ii) is subject to a pending offer for
purchase from an eligible entity.
``(B) Inclusions.--The term `eligible land'
includes, on a farm or ranch--
``(i) cropland;
``(ii) rangeland;
``(iii) grassland;
``(iv) pasture land; and
``(v) forest land that is an incidental part
of an agricultural operation, as determined by the
Secretary.
``(3) Indian tribe.--The term `Indian tribe' has the meaning
given the term in section 4 of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. 450b).
``(4) Program.--The term `program' means the farmland
protection program established under section 1238I(a).
``SEC. 1238I. <<NOTE: 16 USC 3838i.>> FARMLAND PROTECTION.
``(a) In General.--The Secretary, acting through the Natural
Resources Conservation Service, shall establish and carry out a farmland
protection program under which the Secretary shall purchase conservation
easements or other interests in eligible land that is subject to a
pending offer from an eligible entity 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
subchapter 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) Cost Sharing.--
``(1) Farmland protection.--
``(A) Share provided under this subsection.--The
share of the cost of purchasing a conservation easement
or other interest in eligible land described in
subsection (a) provided under section 1241(d) shall not
exceed 50 percent of the appraised fair market value of
the conservation easement or other interest in eligible
land.
``(B) Share not provided under this subsection.--As
part of the share of the cost of purchasing a
conservation easement or other interest in eligible land
described in subsection (a) that is not provided under
section 1241(d), an eligible entity may include a
charitable donation by the private landowner from which
the eligible land is to be purchased of not more than 25
percent of the fair
[[Page 116 STAT. 269]]
market value of the conservation easement or other
interest in eligible land.
``(2) Bidding down.--If the Secretary determines that 2 or
more applications for the purchase of a conservation easement or
other interest in eligible land described in subsection (a) are
comparable in achieving the purposes of this section, the
Secretary shall not assign a higher priority to any 1 of those
applications solely on the basis of lesser cost to the farmland
protection program established under subsection (a).
``SEC. 1238J. <<NOTE: 16 USC 3838j.>> FARM VIABILITY PROGRAM.
``(a) In General.--The Secretary may provide to eligible entities
identified by the Secretary grants for use in carrying out farm
viability programs developed by the eligible entities and approved by
the Secretary.
``(b) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary to carry out this section such sums as are
necessary for each of fiscal years 2002 through 2007.''.
(b) Conforming Amendments.--
(1) In general.--
(A) Section 388 of the Federal Agriculture
Improvement and Reform Act of 1996 (16 U.S.C. 3830 note;
Public Law 104-127) is repealed.
(B) Section 211 of the Agriculture Risk Protection
Act of 2000 (16 U.S.C. 3830 note; Public Law 106-224) is
amended--
(i) by striking subsection (a); and
(ii) in subsection (b)--
(I) by striking the subsection
designation and the subsection heading;
(II) by redesignating paragraphs
(1), (2), and (3) as subsections (a),
(b), and (c), respectively, and
indenting appropriately;
(III) in subsection (a) (as so
redesignated), by redesignating
subparagraphs (A), (B), and (C) as
paragraphs (1), (2), and (3),
respectively, and indenting
appropriately;
(IV) in subsection (b) (as so
redesignated), by striking
``assistance'' and inserting
``Assistance''; and
(V) by striking ``subsection'' each
place it appears and inserting
``section''.
(2) Effect <<NOTE: 16 USC 3830 note.>> on contracts.--The
amendment made by paragraph (1)(A) shall have no effect on any
contract entered into under section 388 of the Federal
Agriculture Improvement and Reform Act of 1996 (16 U.S.C. 3830
note) that is in effect as of the date of enactment of this Act.
SEC. 2504. RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM.
Subtitle H of title XV of the Agriculture and Food Act of 1981 (16
U.S.C. 3451 et seq.) is amended to read as follows:
[[Page 116 STAT. 270]]
``Subtitle H--Resource Conservation and Development Program
``SEC. 1528. <<NOTE: 16 USC 3451.>> DEFINITIONS.
``In this subtitle:
``(1) Area plan.--The term `area plan' means a resource
conservation and use plan developed through a planning process
by a council for a designated area of 1 or more States, or of
land under the jurisdiction of an Indian tribe, that includes 1
or more of the following elements:
``(A) A land conservation element, the purpose of
which is to control erosion and sedimentation.
``(B) A water management element that provides 1 or
more clear environmental or conservation benefits, the
purpose of which is to provide for--
``(i) the conservation, use, and quality of
water, including irrigation and rural water
supplies;
``(ii) the mitigation of floods and high water
tables;
``(iii) the repair and improvement of
reservoirs;
``(iv) the improvement of agricultural water
management; and
``(v) the improvement of water quality.
``(C) A community development element, the purpose
of which is to improve--
``(i) the development of resources-based
industries;
``(ii) the protection of rural industries from
natural resource hazards;
``(iii) the development of adequate rural
water and waste disposal systems;
``(iv) the improvement of recreation
facilities;
``(v) the improvement in the quality of rural
housing;
``(vi) the provision of adequate health and
education facilities;
``(vii) the satisfaction of essential
transportation and communication needs; and
``(viii) the promotion of food security,
economic development, and education.
``(D) A land management element, the purpose of
which is--
``(i) energy conservation, including the
production of energy crops;
``(ii) the protection of agricultural land, as
appropriate, from conversion to other uses;
``(iii) farmland protection; and
``(iv) the protection of fish and wildlife
habitats.
``(2) Board.--The term `Board' means the Resource
Conservation and Development Policy Advisory Board established
under section 1533(a).
``(3) Council.--The term `council' means a nonprofit entity
(including an affiliate of the entity) operating in a State that
is--
``(A) established by volunteers or representatives
of States, local units of government, Indian tribes, or
local nonprofit organizations to carry out an area plan
in a designated area; and
[[Page 116 STAT. 271]]
``(B) designated by the chief executive officer or
legislature of the State to receive technical assistance
and financial assistance under this subtitle.
``(4) Designated area.--The term `designated area' means a
geographic area designated by the Secretary to receive technical
assistance and financial assistance under this subtitle.
``(5) Financial assistance.--The term `financial assistance'
means a grant or loan provided by the Secretary (or the
Secretary and other Federal agencies) to, or a cooperative
agreement entered into by the Secretary (or the Secretary and
other Federal agencies) with, a council, or association of
councils, to carry out an area plan in a designated area,
including assistance provided for planning, analysis,
feasibility studies, training, education, and other activities
necessary to carry out the area plan.
``(6) Indian tribe.--The term `Indian tribe' has the meaning
given the term in section 4 of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. 450b).
``(7) Local unit of government.--The term `local unit of
government' means--
``(A) any county, city, town, township, parish,
village, or other general-purpose subdivision of a
State; and
``(B) any local or regional special district or
other limited political subdivision of a State,
including any soil conservation district, school
district, park authority, and water or sanitary
district.
``(8) Nonprofit organization.--The term `nonprofit
organization' means any organization that is--
``(A) described in section 501(c) of the Internal
Revenue Code of 1986; and
``(B) exempt from taxation under section 501(a) of
the Internal Revenue Code of 1986.
``(9) Planning process.--The term `planning process' means
actions taken by a council to develop and carry out an effective
area plan in a designated area, including development of the
area plan, goals, purposes, policies, implementation activities,
evaluations and reviews, and the opportunity for public
participation in the actions.
``(10) Project.--The term `project' means a project that is
carried out by a council to achieve any of the elements of an
area plan.
``(11) Secretary.--The term `Secretary' means the Secretary
of Agriculture.
``(12) State.--The term `State' means--
``(A) any State;
``(B) the District of Columbia; or
``(C) any territory or possession of the United
States.
``(13) Technical assistance.--The term `technical
assistance' means any service provided by the Secretary or agent
of the Secretary, including--
``(A) inventorying, evaluating, planning, designing,
supervising, laying out, and inspecting projects;
``(B) providing maps, reports, and other documents
associated with the services provided;
``(C) providing assistance for the long-term
implementation of area plans; and
[[Page 116 STAT. 272]]
``(D) providing services of an agency of the
Department of Agriculture to assist councils in
developing and carrying out area plans.
``SEC. 1529. <<NOTE: 16 USC 3452.>> RESOURCE CONSERVATION AND
DEVELOPMENT PROGRAM.
``The <<NOTE: Establishment.>> Secretary shall establish a resource
conservation and development program under which the Secretary shall
provide technical assistance and financial assistance to councils to
develop and carry out area plans and projects in designated areas--
``(1) to conserve and improve the use of land, develop
natural resources, and improve and enhance the social, economic,
and environmental conditions in primarily rural areas of the
United States; and
``(2) to encourage and improve the capability of State,
units of government, Indian tribes, nonprofit organizations, and
councils to carry out the purposes described in paragraph (1).
``SEC. 1530. <<NOTE: 16 USC 3453.>> SELECTION OF DESIGNATED AREAS.
``The Secretary shall select designated areas for assistance under
this subtitle on the basis of the elements of area plans.
``SEC. 1531. <<NOTE: 16 USC 3454.>> POWERS OF THE SECRETARY.
``In carrying out this subtitle, the Secretary may--
``(1) provide technical assistance to any council to assist
in developing and implementing an area plan for a designated
area;
``(2) cooperate with other departments and agencies of the
Federal Government, States, local units of government, local
Indian tribes, and local nonprofit organizations in conducting
surveys and inventories, disseminating information, and
developing area plans;
``(3) assist in carrying out an area plan approved by the
Secretary for any designated area by providing technical
assistance and financial assistance to any council; and
``(4) enter into agreements with councils in accordance with
section 1532.
``SEC. 1532. <<NOTE: 16 USC 3455.>> ELIGIBILITY; TERMS AND CONDITIONS.
``(a) Eligibility.--Technical assistance and financial assistance
may be provided by the Secretary under this subtitle to any council to
assist in carrying out a project specified in an area plan approved by
the Secretary only if--
``(1) the council agrees in writing--
``(A) to carry out the project; and
``(B) to finance or arrange for financing of any
portion of the cost of carrying out the project for
which financial assistance is not provided by the
Secretary under this subtitle;
``(2) the project is included in an area plan and is
approved by the council;
``(3) the Secretary determines that assistance is necessary
to carry out the area plan;
``(4) the project provided for in the area plan is
consistent with any comprehensive plan for the area;
``(5) the cost of the land or an interest in the land
acquired or to be acquired under the plan by any State, local
unit of government, Indian tribe, or local nonprofit
organization
[[Page 116 STAT. 273]]
is borne by the State, local unit of government, Indian tribe,
or local nonprofit organization, respectively; and
``(6) the State, local unit of government, Indian tribe, or
local nonprofit organization participating in the area plan
agrees to maintain and operate the project.
``(b) Loans.--
``(1) In general.--Subject to paragraphs (2) and (3), a loan
made under this subtitle shall be made on such terms and
conditions as the Secretary may prescribe.
``(2) Term.--A loan for a project made under this subtitle
shall have a term of not more than 30 years after the date of
completion of the project.
``(3) Interest rate.--A loan made under this subtitle shall
bear interest at the average rate of interest paid by the United
States on obligations of a comparable term, as determined by the
Secretary of the Treasury.
``(c) Approval by Secretary.--Technical assistance and financial
assistance under this subtitle may not be made available to a council to
carry out an area plan unless the area plan has been submitted to and
approved by the Secretary.
``(d) Withdrawal.--The Secretary may withdraw technical assistance
and financial assistance with respect to any area plan if the Secretary
determines that the assistance is no longer necessary or that sufficient
progress has not been made toward developing or implementing the
elements of the area plan.
``SEC. 1533. <<NOTE: 16 USC 3456.>> RESOURCE CONSERVATION AND
DEVELOPMENT POLICY ADVISORY BOARD.
``(a) Establishment.--The Secretary shall establish within the
Department of Agriculture a Resource Conservation and Development Policy
Advisory Board.
``(b) Composition.--
``(1) In general.--The Board shall be composed of at least 7
employees of the Department of Agriculture selected by the
Secretary.
``(2) Chairperson.--A member of the Board shall be
designated by the Secretary to serve as chairperson of the
Board.
``(c) Duties.--The Board shall advise the Secretary regarding the
administration of this subtitle, including the formulation of policies
for carrying out this subtitle.
``SEC. 1534. <<NOTE: 16 USC 3457.>> EVALUATION OF PROGRAM.
``(a) In General.--The Secretary, in consultation with councils,
shall evaluate the program established under this subtitle to determine
whether the program is effectively meeting the needs of, and the
purposes identified by, States, units of government, Indian tribes,
nonprofit organizations, and councils participating in, or served by,
the program.
``(b) Report.--Not <<NOTE: Deadline.>> later than June 30, 2005, the
Secretary shall submit to the Committee on Agriculture of the House of
Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate a report describing the results of the
evaluation, together with any recommendations of the Secretary for
continuing, terminating, or modifying the program.
[[Page 116 STAT. 274]]
``SEC. 1535. <<NOTE: 16 USC 3458.>> LIMITATION ON ASSISTANCE.
``In carrying out this subtitle, the Secretary shall provide
technical assistance and financial assistance with respect to not more
than 450 active designated areas.
``SEC. 1536. <<NOTE: 16 USC 3459.>> SUPPLEMENTAL AUTHORITY OF THE
SECRETARY.
``The authority of the Secretary under this subtitle to assist
councils in the development and implementation of area plans shall be
supplemental to, and not in lieu of, any authority of the Secretary
under any other provision of law.
``SEC. 1537. <<NOTE: 16 USC 3460.>> AUTHORIZATION OF APPROPRIATIONS.
``(a) In General.--There are authorized to be such sums as are
necessary to carry out this subtitle.
``(b) Loans.--The Secretary shall not use more than $15,000,000 of
any funds made available for a fiscal year to make loans under this
subtitle.
``(c) Availability.--Funds appropriated to carry out this subtitle
shall remain available until expended.''.
SEC. 2505. SMALL WATERSHED REHABILITATION PROGRAM.
Section 14 of the Watershed Protection and Flood Prevention Act (16
U.S.C. 1012) is amended by striking subsection (h) and inserting the
following:
``(h) Funding.--
``(1) Funds of commodity credit corporation.--In carrying
out this section, of the funds of the Commodity Credit
Corporation, the Secretary shall make available, to remain
available until expended--
``(A) $45,000,000 for fiscal year 2003;
``(B) $50,000,000 for fiscal year 2004;
``(C) $55,000,000 for fiscal year 2005;
``(D) $60,000,000 for fiscal year 2006;
``(E) $65,000,000 for fiscal year 2007; and
``(F) $0 for fiscal year 2008.
``(2) Authorization of appropriations.--In addition to
amounts made available under paragraph (1), there are authorized
to be appropriated to the Secretary to carry out this section,
to remain available until expended--
``(A) $45,000,000 for fiscal year 2003;
``(B) $55,000,000 for fiscal year 2004;
``(C) $65,000,000 for fiscal year 2005;
``(D) $75,000,000 for fiscal year 2006; and
``(E) $85,000,000 for fiscal year 2007.''.
SEC. 2506. USE OF SYMBOLS, SLOGANS, AND LOGOS.
Section 356 of the Federal Agriculture Improvement Act of 1996 (16
U.S.C. <<NOTE: 16 USC 5805.>> 5801 et seq.) is amended--
(1) in subsection (c)--
(A) by redesignating paragraphs (4) through (7) as
paragraphs (5) through (8), respectively; and
(B) by inserting after paragraph (3) the following:
``(4) on the written approval of the Secretary, to use,
license, or transfer symbols, slogans, and logos of the
Foundation (exclusive of any symbol or logo of a governmental
entity);''; and
(2) in subsection (d), by adding at the end the following:
``(3) Use of symbols, slogans, and logos of the
foundation.--
[[Page 116 STAT. 275]]
``(A) In general.--The Secretary may authorize the
Foundation to use, license, or transfer symbols,
slogans, and logos of the Foundation.
``(B) Income.--
``(i) In general.--All revenue received by the
Foundation from the use, licensing, or transfer of
symbols, slogans, and logos of the Foundation
shall be transferred to the Secretary.
``(ii) Conservation operations.--The Secretary
shall transfer all revenue received under clause
(i) to the account within the Natural Resources
Conservation Service that is used to carry out
conservation operations.''.
SEC. 2507. <<NOTE: 43 USC 2211 note.>> DESERT TERMINAL LAKES.
``(a) In General.--Subject to subsection (b), as soon as practicable
after the date of enactment of this Act, the Secretary of Agriculture
shall transfer $200,000,000 of the funds of the Commodity Credit
Corporation to the Bureau of Reclamation Water and Related Resources
Account, which funds shall--
``(1) be used by the Secretary of the Interior, acting
through the Commissioner of Reclamation, to provide water to at-
risk natural desert terminal lakes; and
``(2) remain available until expended.
``(b) Limitation.--The funds described in subsection (a) shall not
be used to purchase or lease water rights.
Subtitle G--Conservation Corridor Demonstration Program
SEC. 2601. <<NOTE: 16 USC 3801 note.>> DEFINITIONS.
In this subtitle:
(1) Delmarva peninsula.--The term ``Delmarva Peninsula''
means land in the States of Delaware, Maryland, and Virginia
located on the east side of the Chesapeake Bay.
(2) Demonstration program.--The term ``demonstration
program'' means the Conservation Corridor Demonstration Program
established under this subtitle.
(3) Conservation corridor plan; plan.--The terms
``conservation corridor plan'' and ``plan'' mean a conservation
corridor plan required to be submitted and approved as a
condition for participation in the demonstration program.
(4) Secretary.--The term ``Secretary'' means the Secretary
of Agriculture.
SEC. 2602. <<NOTE: 16 USC 3801 note.>> CONSERVATION CORRIDOR
DEMONSTRATION PROGRAM.
(a) Establishment.--The Secretary shall carry out a demonstration
program, to be known as the ``Conservation Corridor Demonstration
Program'', under which any of the States of Delaware, Maryland, and
Virginia, a local government of any 1 of those States with jurisdiction
over land on the Delmarva Peninsula, or a combination of those States,
may submit a conservation corridor plan to integrate agriculture and
forestry conservation programs of the Department of Agriculture with
State and local efforts to address farm conservation needs.
(b) Submission of Conservation Corridor Plan.--
[[Page 116 STAT. 276]]
(1) Submission and proposal.--To be eligible to participate
in the demonstration program, a State, local government, or
combination of States referred to in subsection (a) shall--
(A) submit to the Secretary a conservation corridor
plan that--
(i) proposes specific criteria and commitment
of resources in the geographic region designated
in the plan; and
(ii) describes how the linkage of Federal,
State, and local resources will improve--
(I) the economic viability of
agriculture; and
(II) the environmental integrity of
the watersheds in the Delmarva
Peninsula; and
(B) demonstrate to the Secretary that, in developing
the plan, the State, local government, or combination of
States has solicited and taken into account the views of
local residents.
(2) Draft memorandum of agreement.--If the conservation
corridor plan is submitted by more than 1 State, the plan shall
provide a draft memorandum of agreement among entities in each
submitting State.
(c) Review <<NOTE: Deadline.>> of Plan.--Not later than 90 days
after the date of receipt of a conservation corridor plan, the
Secretary--
(1) shall review the plan; and
(2) may approve the plan for implementation under this
subtitle if the Secretary determines that the plan meets the
requirements specified in subsection (d).
(d) Criteria for Approval.--The Secretary may approve a conservation
corridor plan only if, as determined by the Secretary, the plan provides
for each of the following:
(1) Voluntary actions.--Actions taken under the plan--
(A) are voluntary;
(B) require the consent of willing landowners; and
(C) provide a mechanism by which the landowner may
withdraw such consent without adverse consequences other
than the loss of any payments to the landowner
conditioned on continued enrollment of the land.
(2) Land of high conservation value.--Criteria specified in
the plan ensure that land enrolled in each conservation program
incorporated through the plan are of exceptionally high
conservation value, as determined by the Secretary.
(3) No effect on unenrolled land.--The enrollment of land in
a conservation program incorporated through the plan will
neither--
(A) adversely affect any adjacent land not so
enrolled; nor
(B) create any buffer zone on such unenrolled land.
(4) Greater benefits.--The conservation programs
incorporated through the plan provide benefits greater than the
benefits that would likely be achieved through individual
application of the conservation programs.
(5) Sufficient staffing.--Staffing, considering both Federal
and non-Federal resources, is sufficient to ensure success of
the plan.
[[Page 116 STAT. 277]]
SEC. 2603. <<NOTE: 16 USC 3801 note.>> IMPLEMENTATION OF CONSERVATION
CORRIDOR PLAN.
(a) Memorandum of Agreement.--On approval of a conservation corridor
plan, the Secretary may enter into a memorandum of agreement with the
State, local government, or combination of States that submitted the
plan to--
(1) guarantee specific program resources for implementation
of the plan;
(2) establish various compensation rates to the extent that
the parties to the agreement consider justified; and
(3) provide streamlined and integrated paperwork
requirements.
(b) Continued Compliance With Plan Approval Criteria.--The Secretary
shall terminate the memorandum of agreement entered into under
subsection (a) with respect to an approved conservation corridor plan
and cease the provision of resources for implementation of the plan if
the Secretary determines that, in the implementation of the plan--
(1) the State, local government, or combination of States
that submitted the plan has deviated from--
(A) the plan;
(B) the criteria specified in section 2602(d) on
which approval of the plan was conditioned; or
(C) the cost-sharing requirements of section 2604(a)
or any other condition of the plan; or
(2) the economic viability of agriculture in the geographic
region designated in the plan is being hindered.
(c) Progress Report.--At the end of the 3-year period that begins on
the date on which funds are first provided with respect to a
conservation corridor plan under the demonstration program, the State,
local government, or combination of States that submitted the plan shall
submit to the Secretary--
(1) a report on the effectiveness of the activities carried
out under the plan; and
(2) an evaluation of the economic viability of agriculture
in the geographic region designated in the plan.
(d) Duration.--The demonstration program shall be carried out for
not less than 3 nor more than 5 years beginning on the date on which
funds are first provided under the demonstration program.
SEC. 2604. <<NOTE: 16 USC 3801 note.>> FUNDING REQUIREMENTS.
(a) Cost Sharing.--
(1) Required non-federal share.--Subject to paragraph (2),
as a condition on the approval of a conservation corridor plan,
the Secretary shall require the State and local participants to
contribute financial resources sufficient to cover at least 50
percent of the total cost of the activities carried out under
the plan.
(2) Exception.--The Secretary may reduce the cost-sharing
requirement in the case of a specific project or activity under
the demonstration program on good cause and on demonstration
that the project or activity is likely to achieve extraordinary
natural resource benefits.
(b) Reservation of Funds.--The Secretary may consider directing
funds on a priority basis to the demonstration program and to projects
in areas identified by the plan.
[[Page 116 STAT. 278]]
(c) Authorization of Appropriations.--There are authorized to be
appropriated such sums as are necessary to carry out this subtitle for
each of fiscal years 2002 through 2007.
Subtitle H--Funding and Administration
SEC. 2701. FUNDING AND ADMINISTRATION.
Subtitle E of the Food Security Act of 1985 is amended by striking
sections 1241 and 1242 (16 U.S.C. 3841, 3842) and inserting the
following:
``SEC. 1241. <<NOTE: 16 USC 3841.>> COMMODITY CREDIT CORPORATION.
``(a) In General.--For each of fiscal years 2002 through 2007, the
Secretary shall use the funds, facilities, and authorities of the
Commodity Credit Corporation to carry out the following programs under
subtitle D (including the provision of technical assistance):
``(1) The conservation reserve program under subchapter B of
chapter 1.
``(2) The wetlands reserve program under subchapter C of
chapter 1.
``(3) The conservation security program under subchapter A
of chapter 2.
``(4) The farmland protection program under subchapter B of
chapter 2, using, to the maximum extent practicable--
``(A) $50,000,000 in fiscal year 2002;
``(B) $100,000,000 in fiscal year 2003;
``(C) $125,000,000 in each of fiscal years 2004 and
2005;
``(D) $100,000,000 in fiscal year 2006; and
``(E) $97,000,000 in fiscal year 2007.
``(5) The grassland reserve program under subchapter C of
chapter 2, using, to the maximum extent practicable $254,000,000
for the period of fiscal years 2003 through 2007.
``(6) The environmental quality incentives program under
chapter 4, using, to the maximum extent practicable--
``(A) $400,000,000 in fiscal year 2002;
``(B) $700,000,000 in fiscal year 2003;
``(C) $1,000,000,000 in fiscal year 2004;
``(D) $1,200,000,000 in each of fiscal years 2005
and 2006; and
``(E) $1,300,000,000 in fiscal year 2007.
``(7) The wildlife habitat incentives program under section
1240N, using, to the maximum extent practicable--
``(A) $15,000,000 in fiscal year 2002;
``(B) $30,000,000 in fiscal year 2003;
``(C) $60,000,000 in fiscal year 2004; and
``(D) $85,000,000 in each of fiscal years 2005
through 2007.
``(b) Section 11.--Nothing in this section affects the limit on
expenditures for technical assistance imposed by section 11 of the
Commodity Credit Corporation Charter Act (15 U.S.C. 714i).
``(c) Regional Equity.-