A New Farm Bill: Comparing the House and Senate Proposals with Current Law
Congressional research reportMar 12, 2002
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Order Code RL31272
CRS Report for Congress
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A New Farm Bill: Comparing the House and
Senate Proposals with Current Law
Updated March 12, 2002
Agriculture and Food Section
Coordinated by Jean Yavis Jones
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress
A New Farm Bill: Comparing the House and Senate
Proposals with Current Law
Summary
The House and Senate have approved different versions of a new farm bill
(H.R.2646) that will set agriculture and food policy for the next several years (5 years
under the Senate bill; 10 years under the House bill). Meetings between the House and
Senate to discuss differences between the chambers' bills began in early March 2002.
The House passed its bill, entitled the Farm Security Act of 2001 (H.R. 2646), on
October 5, 2001. The Senate farm bill debate continued into the second session of the
107th Congress when a substitute version of S.1731 (the so-called Daschle Substitute)
was approved along with numerous other amendments (including a 397- page
Managers’ Amendment) on February 13, 2002. The much-revised Senate measure was
renumbered H.R.2646, although it retained its title (The Agriculture, Conservation, and
Rural Enhancement Act).
The size of the Senate version -- almost 1400 pages compared to the 379 page
House bill -- is not necessarily a measure of the policy differences between the
chambers. The commodity titles in the two bills retain marketing loan assistance and
fixed, decoupled annual farm payments. They both also add target prices and countercyclical income support (or deficiency payments) for major field crops. Conservation
activities and nutrition programs are enhanced under both bills, although more so in the
Senate bill. Both bills also increase spending above current law baselines. The FY2002
budget resolution allowed for $73.5 billion above the 10-year baseline. The
Congressional Budget Office (CBO) estimates the costs of the House bill at $73.5
billion over baseline. The same amount originally was estimated for the Senate bill until
CBO discovered a $6.1 billion underestimate in its calculations. The revised amount
($79.6 billion) is not the only spending difference from the House bill. The Senate bill
spends its new money more quickly than does the House and also adds another $2.4
billion in “emergency” farm aid for FY2002. The cost and speed of spending are
expected to be major issues in House-Senate Conference committee deliberations.
The Administration has indicated that it prefers the more evenly measured pace of
new spending in the House bill, which spends under half of its new money in the first
5 years. By contrast, the Senate bill would spend well over 60% of its total new money
in the first 5 years (not counting the $6.1 billion underestimate or the $2.4 billion in
emergency farm aid for FY2002). The Administration has not taken a public position
on other differences between the chambers’ bills. Among the most controversial are
Senate provisions that significantly lower the limit on commodity payments to farmers;
restraints on packer ownership of livestock going to slaughter; potential increased
federal control of certain water rights; and a new dairy counter-cyclical-income support
program.
Lawmakers in both chambers are pressing for quick resolution so that farmers can
make their spring planting decisions for 2002 and the Congress can make use of the new
spending for the farm bill allowed by last year’s congressional budget resolution.
Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Legislation in the 107th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Summary Comparison . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Spending and Time-frame. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Administration Views . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Selected Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Commodity program provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Farm Payment Limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Federal Budget and Trade Agreement Issues . . . . . . . . . . . . . . . . . . . . 9
Dairy Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Conservation Programs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Concentration in the livestock sector . . . . . . . . . . . . . . . . . . . . . . . . . 10
Comparison Caveats . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
COMPARISON OF SELECTED PROVISIONS: CURRENT LAW AND
HOUSE AND SENATE FARM BILLS
(H.R. 2646 AND THE SENATE AMENDMENT) . . . . . . . . . . . . . . . . 12
I. COMMODITY PROGRAMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Title: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Definitions: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
A. GRAINS et. al. (Wheat, Corn, Grain Sorghum, Barley, Oats, Upland Cotton, Rice,
Soybeans and Minor Oilseeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
1. Fixed, Decoupled Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2. Counter-Cyclical Deficiency Payments and Target Prices . . . . . . . . . . . 19
3. Marketing Assistance Loans and LDPs . . . . . . . . . . . . . . . . . . . . . . . . . 20
B. OTHER COMMODITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
a. Dry Peas, Lentils and Chickpeas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
b. Grazed Wheat, Barley, and Oats . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
c. High Moisture Corn and Sorghum . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
d. ELS and Seed Cotton . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
e. Hard White Wheat Incentive Payments . . . . . . . . . . . . . . . . . . . . . . . . . .
f. Cotton Competitiveness Provisions for Processors and Exporters . . . . . .
g. Sugar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
h. Peanuts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
i. Wool and Mohair . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
j Honey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
k. Dairy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
l. Tobacco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
m. Specialty Crops . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
23
23
24
24
25
25
25
26
29
31
31
32
37
37
C. PAYMENT LIMITS (Fixed, marketing loan, countercyclical) . . . . . . . . . . . . 38
D. COUNTER-CYCLICAL FARM SAVINGS ACCOUNTS . . . . . . . . . . . . . 39
E. WTO LIMITS ON ALLOWABLE DOMESTIC SUPPORT . . . . . . . . . . . . 40
II. CONSERVATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
A. Environmental Conservation Acreage Program (ECARP) . . . . . . . . . . .
B. Conservation Reserve Program (CRP) . . . . . . . . . . . . . . . . . . . . . . . . .
C. Wetlands Reserve Program (WRP . . . . . . . . . . . . . . . . . . . . . . . . . . . .
D. Environmental Quality Incentives Program . . . . . . . . . . . . . . . . . . . . . .
E. Wildlife Habitat Incentives Program (WHIP . . . . . . . . . . . . . . . . . . . . .
F. Farmland Protection Program (FPP) . . . . . . . . . . . . . . . . . . . . . . . . . . .
G. Other Programs (Including Technical Assistance) . . . . . . . . . . . . . . . .
H. New Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
41
41
42
45
47
50
51
52
54
III. AGRICULTURAL TRADE AND AID . . . . . . . . . . . . . . . . . . . . . . . . . .
A. Agricultural Export Assistance Programs . . . . . . . . . . . . . . . . . . . . . . .
B. Food Aid Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
C. Other Trade Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
64
64
68
74
IV. NUTRITION PROGRAMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
A. Food Stamp Program, . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
B. Commodity Assistance Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
C. Child Nutrition Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
D. Special Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
E. Effective Dates and Cost Estimates . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
V. FARM CREDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
A. Farm Ownership/Real Estate Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
B. Operating Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
C. Emergency Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
D. Administrative Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
E. Department of Agriculture Reorganization Act of 1994 . . . . . . . . . . . . . 110
F. Farm Credit System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
G. Miscellaneous Credit and Finance Provisions . . . . . . . . . . . . . . . . . . . . . 111
VI. RURAL DEVELOPMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
A. Rural Community Advancement Program . . . . . . . . . . . . . . . . . . . . . . . 113
B. Fund for Rural America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
C. Telecommunications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
D. Value-added Agriculture Development . . . . . . . . . . . . . . . . . . . . . . . . . 115
E. Water and Waste Treatment Programs . . . . . . . . . . . . . . . . . . . . . . . . . 116
F. Rural Entrepreneur and Business Investment Programs . . . . . . . . . . . . . 117
G. Strategic Rural and Regional Planning Programs . . . . . . . . . . . . . . . . . . 118
H. Rural America Infrastructure Account . . . . . . . . . . . . . . . . . . . . . . . . . . 119
I. Other Rural Development Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120
VII. RESEARCH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
A. Funding Authorities: USDA In-House Research and Cooperative Extension
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
B. The Initiative for Future Agriculture and Food Systems . . . . . . . . . . . . 123
C. Land Grant Institutions in Insular Areas . . . . . . . . . . . . . . . . . . . . . . . . 124
D. 1890 Land Grant Universities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
E. 1994 Institutions (Tribally Controlled Land Grant Institutions . . . . . . . . 126
F. Priority Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
G. International Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
H. Biotechnology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
I. Research Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
J. Competitive Research Grants Administration . . . . . . . . . . . . . . . . . . . . 129
K. Biosecurity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129
L. Research related to Rural and Beginning Farmers . . . . . . . . . . . . . . . . . 130
M. Miscellaneous Research Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
VIII. FORESTRY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134
A. Forest Landowner Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134
B. Suburban and Community Forestry . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
C. Watershed Forestry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
D. Fire Protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
E. Forest Health Protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136
F. Forestry Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
G. Renewable Resources (RREA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
H. International Forestry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
I. Tribal Forestry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138
J. National Forest Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138
IX. MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139
A. Federal Crop Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139
B. Noninsured Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142
C. Emergency Crop Disaster and Income Loss Assistance . . . . . . . . . . . . . 143
D. Livestock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
E. Migrant and Seasonal Farmworker Assistance . . . . . . . . . . . . . . . . . . . . 144
F. Tree Assistance and Caneberries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
G. Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
H. Anti-trust and Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153
I. Animal Transport, Inspection and Health . . . . . . . . . . . . . . . . . . . . . . . . 154
H. Plant Protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160
J. Pseudorabies Eradication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
K. Preclearance Quarantine Inspections for Hawaii . . . . . . . . . . . . . . . . . . 161
L. Non-Ambulatory Farm Animals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162
M. Animal Welfare Act (nonfarm animals) . . . . . . . . . . . . . . . . . . . . . . . . 162
N. Genetically Engineered Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
O. Pesticides and School Pesticide Management Plans . . . . . . . . . . . . . . . 166
P. Socially Disadvantaged Farmers and Ranchers . . . . . . . . . . . . . . . . . . . . 167
Q. Outreach and Assistance to Geographically Disadvantaged Farmers and
Ranchers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168
R. Farm Marketing Programs
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
S. Studies, Reports and Task Forces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
This report reflects the contributions of the following CRS Analysts:
Farm Bill Provisions
CRS Analyst
Summary and Introduction
Jean Yavis Jones
Commodity Programs
Jasper Womach, Ralph Chite, Remy
Jurenas, Brenda Branaman, Carol
Canada
Conservation
Jeffrey Zinn
Agricultural Trade and Aid
Geoffrey Becker
Nutrition Programs
Joe Richardson
Farm Credit
Jerry Heykoop
Rural Development
Tadlock Cowan
Research
Jean Rawson
Forestry
Ross Gorte
Federal Crop Insurance
Ralph Chite
Energy
Brent Yacobucci
Animal Welfare
Genetically Engineered Food
Alex Segarra
Pesticides
Linda Schierow
For more information, see: CRS Electronic Briefing Book, Agriculture Policy
and the Farm Bill. [http://www.congress.gov/brbk/html/ebagr1.shtml]), and CRS
Report RL31195, The 2002 Farm Bill: Overview and Status..
Individual topic comparisons include the following CRS Reports:
RL31251, Commodity Support Provisions: Comparison of Current Law with
House and Senate Farm Bills by Jasper Womach;.
RL31255, Resource Conservation Title: Comparison of Current Law with
House and Senate Farm Bills by Jeffrey Zinn; and
RL31271, Energy Provisions the Farm Bill: Comparison of Current Law
with House and Senate Farm Bills. by Brent Yacobucci.
A New Farm Bill: Comparing the House and
Senate Proposals with Current Law
Introduction
Consideration of new farm policy began more than a year before the major
provisions of the 1996 farm bill expired. This was due, in large part, to persisting low
prices for many major field commodities and several recent years of multi-billion dollar
farm aid packages approved by the Congress to help offset declining farm income. The
current economic environment is quite different from that existing in 1995-96 when the
last farm bill was considered. Prices for many major commodities are stagnant or
declining, supplies are high, and demand (particularly in previous growth markets
overseas) is not growing at the rates existing in the mid-1990s. Moreover, when the
House and Senate began examining new farm policy options early in 2001, a projected
budget surplus negated the kinds of budget deficit pressures placed on farm program
spending in 1995. The recent recession and costs of the U.S. war against terrorism
could alter this situation. The cost differences between the House and Senate-passed
farm bills (some $6.1 billion over ten years) and the quicker pace of spending in the
Senate farm bill are key issues in the current debate. There is pressure to reach an
agreement in time to assist farmers in making their spring planting decisions, and
concern that failure to enact a new farm bill before the next congressional budget
resolution could put the new money allowed by last year’s budget resolution (+$73.5
billion) in jeopardy.
Background
When the current farm bill was being formulated in 1995 and 1996, the farm
economy was enjoying a boom. Prices for most commodities were at record highs, as
was farm income. Moreover, foreign demand for U.S. agricultural goods was
expanding, particularly in Asia and Latin America. At the same time, in the Congress,
legislators were facing increasing demands for changes in farm policy that would better
control farm program spending and adapt U.S. policies to trade agreements.
The Federal Agricultural Improvement and Reform (FAIR) Act of 1996 (or 1996
Farm bill, was enacted in August 1996, after nearly two years of deliberations, and the
extension of previous law provisions beyond their original 1995 expiration date.1 The
1
Many of the provisions of the 1990 Farm law (P.L. 104-624) were scheduled to expire at the
end of 1995. The transition in 1994 from Democratic to Republican control of the House and
Senate and a new congressional agenda and leaders, delayed completion of a new farm. The
Congress extended the expiring provisions of the 1990 law for an additional year until another
farm law could be enacted in 1996. Many of the key policy changes made by the 1996 law
(continued...)
CRS-2
Agricultural Market Transition Act (AMTA), Title I of the FAIR Act, contained
provisions that capped federal spending, ended land set-asides and target prices for most
commodities, and created a new farm income support system replacing target price
supports. Wheat, feedgrain, cotton, and rice farmers choosing to participate in this new
program were to receive gradually declining fixed, decoupled annual payments (socalled production flexibility contract (PFC) payments, sometimes called AMTA
payments).2 These were provided each year in lump sums, irrespective of market prices
or farmers’ planting decisions.
Opponents of this gradual phase-out of federal assistance worried about what
would happen if prices and markets declined, as began to happen late in 1997. But bill
proponents pointed out that counter-cyclical income relief would remain under the
marketing loan assistance program. Moreover, they contended that farmers getting
Production Flexibility Contract (PFC) payments in good economic times would be able
to put them away for a rainy day to soften the impact of losses during low price periods.
This point also was made in response to those who objected to giving farmers payments
when economic conditions were good.
By 1998 conditions in the farm economy had changed. Prices for many major
commodities began to decline as a financial crisis hit Asia and Latin America (two of
the fastest growth markets for U.S. goods). Moreover, several years of good
worldwide growing conditions had increased supplies and the value of the American
dollar was high relative to other countries, making U.S. goods expensive compared to
competitors. Farm income began to decline, and the Congress stepped in. Seven
emergency farm aid bills approved in 1999, 2000, and 2001 provided nearly $33 billion
in additional federal funds to agriculture (primarily to wheat, feedgrain, oilseed, cotton
and rice farmers). This helped to stabilize farm income and to keep average farm family
income higher than the national average for all U.S. households. However, as the
proportion of net farm income drawn from federal aid approached 50%, many in
Congress and elsewhere began to push for longer term changes to underlying farm
policy that would provide more certainty to farmers than reliance on ad hoc annual
financial aid packages.
Thus, the 107th Congress began to examine agriculture policy and solicit proposals
from the various producer groups shortly after coming into session. Hearings were held
by the House and Senate, and testimony was presented both in Washington and in field
hearings throughout much of 2001. The House passed a bill (H.R. 2646) in October,
2001; the Senate began debate on its farm bill (S.1731) in early December, but was
unable to reach resolution before the adjournment of the first session on December 19,
2001. A much revised Senate bill was passed on February 13, 2002.
1
(...continued)
were authorized through 2002.
2
Payment levels were “decoupled” from target prices, which, in the past, were used to make
payments to farmers when market prices fell below specified targets.
CRS-3
Legislation in the 107th Congress
History
The House Agriculture Committee farm bill (H.R. 2646) was introduced on July
26, 2001. The Committee marked up this bill on July 27 and amended and reported it
on August 2. It was sequentially referred to the House International Relations
Committee, which reported it with amendments on September 10. Floor debate on
H.R.2646 began on October 2 and continued through October 5 when the bill was
passed by a vote of 291-120. The bill was engrossed and sent to the Senate on October
9, 2001
On November 15, 2001, the Senate Agriculture, Nutrition and Forestry Committee
ordered to be reported an original bill (S.1731) in lieu of S.1628, a farm bill introduced
on November 2 by Committee Chairman Harkin. S.1731 was adopted by the
Committee and reported to the Senate on November 27, and placed on the legislative
calendar.3 On November 30, the Senate began debate on a motion to proceed to the
consideration of S.1731. Efforts to speed up consideration and obtain a vote for final
passage on this measure prior to the end of the first session were unsuccessful.4
Several substitute amendments or alternatives to the Committee bill were offered during
debate in the last session. Among these was the Daschle Amendment (#2471),
substituting for the Committee-reported bill. Offered on December 11, it was the
pending vehicle at the end of the first session.
Several substitutes to the Daschle substitute were offered and tabled (i.e.,
effectively rejected) in the first session. The rejected alternatives included:
! An amendment offered by Senator Lugar (# 2473) that would have replaced and
completely revised the commodity provisions of the Daschle substitute and
substantially increased spending for nutrition programs5;
! A substitute amendment offered by Senators Roberts and Cochran (# 2671) that
would have modified the Daschle substitute to reflect some of the concerns
expressed by the Administration (discussed below, and,
! A substitute amendment (# 2678) by Senator Hutchinson (Ark.) offering the
House-passed farm bill (H.R. 2646) as a substitute.
3
The Committee filed a written report on S.1731 on December 7, 2001 (No. 107-117)
4
There were several efforts to invoke cloture in order to cut off debate on this legislation; all
failed. The first (a test vote on the motion to proceed to consideration) failed by a vote of 7326. Subsequent cloture votes failed by lesser votes - 53-45 and 54-43.
5
The Lugar proposal would have established, in lieu of the Senate bill’s target price and
income support provisions, a “whole-farm” income insurance program, available to all crop
and livestock farmers (i.e. livestock and fruit and vegetable growers not now receiving direct
payments). It would have provided for a federal payment equaling 6% of a farm’s receipts
that could be used to pay insurance premiums for guarantees of 80% of average income for
farmers. A pilot project testing this approach in a limited number of states was authorized in
the finally-approved Senate bill.
CRS-4
Early in the second session of the 107th Congress, debate was renewed over the
Senate farm bill (Daschle Substitute Amendment # 2471). On February13, 2002, a
substantially revised bill was approved by the Senate. This version, renumbered as the
Senate amendment to H. R. 2646, reflected some 31 amendments, one of which, the
so-called Managers’ Amendment (#2859), was 397 pages (longer than the entire House
bill of 379 pages). Among the more controversial of the many floor amendments agreed
to was one that lowered limits on farm payments, with savings used to increase
spending for nutrition programs in ways similar to those proposed by the previously
rejected Lugar amendment. Less controversial amendments added livestock feed
assistance, another $2.4 billion in additional emergency farm assistance for FY2002, and
a myriad of new conservation, rural development, research, and animal health and
welfare provisions.
Policy analysts assert that a final bill will have to be agreed upon by late March if
new farm policies are to apply to crop year 2002 production. If there is no new farm
law by that time, another multi-billion dollar farm aid package is possible.
Summary Comparison
Although the House and Senate farm bills described in this report vary from one
another in many respects, there are common features to both. First, although farm
commodity support is the main focus of the two bills and generally has gotten the most
attention, both bills contain much more than farm commodity provisions. Other titles
in the bills cover conservation, trade, nutrition programs, credit, rural development,
research, and forestry. Moreover, both bills seek to reverse some commodity policies
established in the last farm bill that, among other things, eliminated federal target prices
for commodities, and discontinued (in the case of wool, mohair, honey) or gradually
eliminated (in the case of dairy) federal support for some commodities.6 They both
substantially increase funding for farm commodity programs, although in different
amounts. Initial estimates for the Senate farm bill showed it raising commodity program
spending (Title I) by $26.8 billion over five years and by $41.1 billion over ten years.
The addition of $6.1 billion underestimated by CBO brings the revised totals to $30.5
billion and just under $46 billion, respectively, over the 5 and 10 year periods. (This
does not include the additional $2.4 billion in “emergency” assistance the Senate also
added for FY2002 commodity programs.) The House bill adds $25.1 billion to
commodity programs over 5 years, and $48.8 billion over 10 years.
The bills also continue a trend toward increasing federal support for a broader
array of conservation efforts and expanding payments to farmers who engage in
environmentally sensitive farming practices, although the Senate provisions are more
generous in this regard. Both bills also make changes to the food stamp program to
assist states in conforming program rules to those of other welfare programs, to
increase commodity donations to domestic food programs, and in the Senate bill,
restore eligibility to certain legal aliens.
6
The Federal Agriculture Improvement and Reform (FAIR) Act of 1996, P.L. 104-127, was
amended several times to extend the planned expiration date for the dairy price support
program. Congress also restored federal aid for the honey, wool and mohair programs as part
of several “emergency” funding packages enacted to shore up farm income.
CRS-5
Finally, both bills make changes that utilize the $73.5 billion in increased funding
allowed by the budget resolution, although the Senate bill now is estimated to spend
$6.1 billion more than that amount. It also uses up its 10-year funding total more
quickly than does the House, and adds another $2.45 billion in “emergency” farm aid
for FY2002. Some of more significant differences between the bills that are expected
to be the subject of debate in the conference deliberations are described below.
Spending and Time-frame.
The House-passed farm bill has a 10-year life span; the Senate bill authorizes the
programs for 5 years. The time span in the House bill is related to provisions in the
FY2002 Congressional Budget Resolution (H.Con.Res.83) that provided room for
some $73.5 billion in additional spending over the period 2002-2011 for a new farm bill.
The Senate 5-year authorization reflects the more traditional time-frame for multi-year
farm bills, although the new spending is projected over a 10-year period.
The FY2002 Congressional Budget Resolution (H.Con.Res.83) adopted in 2001
made room for additional agriculture spending of $5.5 billion for FY2001, $7.35 billion
in FY2002, and $66.15 billion over the following nine years for food and farm
programs. This provided for a total of $73.5 billion in new budget authority for
FY2002-2011above baseline spending. The expectation was that this new money
would be used to finance a new farm bill and that most of it would go for farm
commodity programs, although this was not required. FY2001 money was spent for
emergency assistance. The allowable spending for FY2002 and beyond was intended
either for emergency farm assistance or a new farm bill.7
Both the House and Senate bills originally were estimated by CBO to cost $73.5
billion over the 10-year period, FY2002-2011. This included funding for farm
commodity programs as well as nutrition programs, trade, research, conservation, and
rural development, among other things. It does not reflect the additional $2.45 billion
in farm “emergency” assistance for FY2002 that the Senate added to its bill.8 It also
does not reflect some $6.1 billion in higher costs that the CBO now says was left out
of earlier projections of the Senate bill commodity provision costs because of an error.
This would bring the new spending in the Senate bill to a total of $79.6 billion.
The Senate bill also spends its new money faster than the House bill -- well over
60% in the first 5 years (FY2002-2006) compared to the House bill which would spend
about half of its new money during that period. Under both bills, well over half of the
new spending goes for commodity programs – $48.8 billion under the House bill and
7
As noted above, the Senate approved a floor amendment to its farm bill that adds $2.4 billion
in “emergency” farm assistance. A waiver to the budget rules requiring offsets of additional
spending for “emergency” reasons was approved by a voice vote so that this additional
spending is not counted against the Senate farm bill for FY2002.
8
A voice vote to waive this additional funding as “emergency” assistance was approved by
the Senate as part of Amendment # 2839); this designation means that the additional funding
does not require offsets in spending elsewhere to conform to budget rules.
CRS-6
$46 billion under the Senate bill.9 Other major spending differences between the two
bills include new budget authority for nutrition and conservation programs. The Senate
raises spending for nutrition programs by $9.3 billion over 10 years, compared to an
increase of $3.7 billion for these program in the House bill. For conservation programs,
the Senate adds $17.4 billion, while the House adds $15.8 billion in new funding over
the next 10 years. Some of the additional funding in the Senate bill for nutrition
program expansion comes from savings in commodity program spending that lowers
the farm payment limit for commodity programs. According to CBO estimates, the
payment limit reduction will lower commodity program spending by $695 million over
10 years. (See later section on payment limit issue.)
Current law estimates project that baseline spending for farm commodity programs
for the next 10 years (that is, the amount of federal spending expected with no changes
in law) will be approximately $97 billion. Using current CBO estimates, the additional
funding provided by commodity program changes in the proposed bills would bring
total spending on farm programs to $145.8 billion under the House bill, and $145.4
billion (including the $2.45 billion in emergency farm assistance added for FY2002)
under the Senate bill.
Administration Views
Like its predecessor, the Bush Administration did not put forward a new farm bill.
In fact, in its first year, the Bush Administration took the position that Congress should
give careful consideration to major farm policy changes before rushing through new
legislation. In other words, it contended that a new farm bill could wait until 2002. A
report issued by the Administration on September 19, 2001, laid out a set of
“principles” for farm policy.10 These principles focused on: (1) the wide differences
among farms and farming practices and the need for better tailored policy to reflect
these differences; (2) the tilt in existing policy toward highly efficient commercial farms
with no direct relationship between federal benefits and a farm’s financial need; and (3)
the need to rely on market rather than government forces over the long term, with short
term aid for “unexpected events” beyond a farmer’s control.
In early October 2001, as the House began floor debate on its farm bill, the Office
of Management and Budget (OMB) issued a Statement of Administration Policy (SAP)
that opposed this legislation. It contended that the House bill encourages
overproduction of commodities, does not target benefits to farmers most in need,
jeopardized global markets, and increases federal spending at a time of economic
uncertainty.
The Administration also objected to the Senate Agriculture Committee farm bill
(S.1731) reported in late November, renewing its concerns about stimulating
overproduction and poor targeting of farm payments. It also reiterated concern about
the bill’s potential to undermine U.S. efforts to phase out foreign countries’ export
9
This amount assumes the $38.9 billion originally estimated by CBO plus the $6.1 billion
CBO has indicated it underestimated for the cost of the commodity provisions in that bill.
10
Food and Agriculture Policy: Taking Stock for the New Century.
CRS-7
subsidies and U.S. ability to meet current trade obligations. Finally, the Administration
took the position that the Senate-reported bill would authorize costly and ineffective
conservation programs, weaken accountability in domestic nutrition programs, and
result in unknown budget costs.
In early January 2002, USDA officials indicated that they expect Congress and the
Bush Administration to agree on a farm bill by early March, 2002. OMB officials
informed the Congress that the President supports the $73.5 billion in additional farm
spending over ten years that was permitted by last year’s congressional budget
resolution. This appears to have removed some of the concerns that failure to enact a
new farm bill before the next budget resolution could risk loss of the new funding for
farm bill programs.
In late February, following passage of the Senate farm bill, the Administration
indicated that it preferred the more gradual approach to new spending in the Housepassed farm bill, to the more rapid use of the new money provided by the Senate
amendment. Administration officials fear the potential for the Senate approach to
exhaust federal farm support in the early years and force substantial amounts of new
spending in later years. On the other hand, USDA officials have expressed concern
about the large amount of new funding in the House bill for farm commodity programs,
and the Administration appears to favor some of the nutrition program provisions in the
Senate bill.
Selected Issues
Commodity program provisions. Both bills maintain a system of fixed annual
payments to wheat, feedgrain and cotton and rice farmers, although the House appears
to provide more assistance in this form than does the Senate.11 Both bills add soybean
growers to those eligible for these fixed payments. Both bills also maintain marketing
loan assistance, but the House bill sets loan rates at, or slightly below, those set under
current law while the Senate substantially raises these rates. On the other hand, while
both bills provide new counter-cyclical income support, the House bill appears to
provide substantially more funding for this supplemental assistance than does the
Senate. In sum, the House approach tends to rely more heavily on fixed annual
payments and greater levels of counter-cyclical income support than the Senate, which
puts more emphasis on higher levels of marketing loan assistance. Both bills maintain
the 1996 policy changes that provided broad planting flexibility to farmers receiving
federal program payments and eliminated annual cropland set-aside tools formerly used
to reduce production to avoid price-depressing surpluses or control federal farm
spending.
11
Official CBO estimates are not available at the time of this report because of the recently
discovered error that underestimated the cost of Senate commodity program provisions by
some $6.1 billion over 10 years. If the full amount of that error is added to the earlier CBO
estimates of the costs of the Senate commodity provisions, the total would be $45.9 billion,
compared to $48.8 billion in the commodity programs cost estimates for the House farm bill.
CRS-8
Farm Payment Limits. Current law limits on payments to farmers are revised
and applied to new programs under both the House and Senate farm bills. The Senate
limitations, which are more stringent than those in the House bill are opposed by most
farm groups.
In general, the farm payment limits first imposed in 1970 have been high enough
so that they rarely resulted in any cut-off of farm payments. Moreover, mechanisms for
getting around the caps have been available. In the late 1990s, however, when it
appeared that loan deficiency payments to some farmers might exceed the limits then
in place, Congress doubled the limit on these payments. 12 The doubled levels have
been operable for the past several years.
A list of farmer payments released by the Environmental Working Group (EWG)
rejuvenated interest in the farm payment limit issue. The EWG data show a large
proportion of federal farm payments, sometimes in quite large amounts, going to small
numbers of large farms and also to some wealthy absentee landlords. This study was
widely reported by the media and reportedly influenced the more stringent payment
limits that were added to the Senate farm bill during floor debate.13
The House bill raises the current law limit on contract payments from $40,000 per
year per person to $50,000. It also sets a maximum of $75,000 in payments for grains,
cotton, and oilseeds, and separately another maximum of $75,000 for peanuts under
the new counter-cyclical income support program it creates. By contrast, the Senate
bill sets a combined maximum per person payment of $75,000 for both fixed payments
and counter-cyclical payments, and applies this limit to all eligible crops, including the
newly eligible peanuts (which are treated separately by the House bill).
Under the marketing loan assistance program, the House bill would raise the
previous farm law limit from $75,000 to $150,000 for wheat, feedgrains, oilseed,
cotton, and rice payments, and would establish separate payment limits of $150,000 for
each of the peanut, honey, wool, and mohair programs.14 The Senate bill establishes
one limit of $150,000 in marketing loan assistance for all of the eligible commodities
(wheat, feedgrains, oilseeds, cotton, rice, honey, wool, lentils, dry peas, and chick peas
15
). It also applies this limit to the value of marketing certificates and loan forfeitures
which, under current law and the House bill, are not counted toward the payment limits.
Additionally, the Senate bill contains language that would prohibit those with adjusted
gross incomes above $2.5 million annually from receiving any farm payments.16 The
12
This followed substantial increases in farm spending enacted under several multi-billion
farm “emergency” aid packages.
13
New York Times, May 18, 2001, Farm Subsidies: Who Gets Fed? Washington Post,
January 24, 2002, More Subsidy Money Going to Fewer Farms. See also, the Environmental
Working Group Farm Subsidy Database at www.ewg.org
14
The farm bill set $75,000 as payment limit for LDPs, but this was doubled by subsequent
legislation when the cap would have cut some farmers off at that level.
15
The Senate bill does not contain assistance for mohair.
16
The lower payment limits were added during Senate floor debate under an amendment
(continued...)
CRS-9
10-year saving from the Senate payment limit provision, as estimated by the CBO, is
$695 million ($405 million over 5 years), most of which is used by the Senate bill to
help fund a food stamp program expansion. Most analysts expect the impact of the
Senate payment limit to be the greatest for large rice and cotton farmers whose federal
payments tend to be larger than those producing other field crops.17
Proponents of limits contend that farm programs benefit most (in terms of federal
dollars) those who need aid the least (i.e., larger, wealthier farmers), while smaller,
high-risk farmers or those ineligible for direct payments (such as fruit, vegetable, and
livestock producers) get little or nothing. They charge that this system encourages the
growth of large corporate farms and helps to drive small and mid-sized farms out of
business. Opponents of payment limits (which include nearly all of the farm and
commodity groups) contend that farm policy should be based on productivity and
efficiency and that payment limits discourage both. They suggest that basing farm
payments on income or need would mean rewarding many farmers who are inefficient
or unwise in their farm management, and would discourage farmers from profitable
efficiencies. Moreover, they point out that many of the farms receiving large payments
also have similarly large costs of production and might not be able to operate as
efficiently or productively if federal support was not tied in some way to output.
Federal Budget and Trade Agreement Issues. The possible return of deficit
spending, or at least substantially depleted budget surpluses because of the War on
Terrorism and an economic slowdown, raises questions about how much funding will
be available for changes in farm policy. There is some concern about whether the
additional money agreed to in the past budget resolution will be honored if a farm bill
is not passed before the next budget resolution. Both the Administration and
congressional leaders, have indicated their intention to honor the additional money
provided for farm policy changes that was allowed by last year’s congressional budget
resolution – some $73.5 billion in additional funding over ten years.
As mentioned earlier, the Administration and the Senate differ over whether the
next farm bill should spend most of additional funding in the early years (and possibly
exhaust this money sooner rather than later) or provide for a more gradual release of
the funds. There is some dispute about how much money should go to commodity
programs versus conservation and nutrition programs. There also is concern that the
new commodity program spending in both bills could exceed the $19 billion cap on
spending for market-distorting domestic support that the U.S. agreed to abide by under
the Uruguay Round Agreement. In response to this concern, both bills contain differing
provisions that provide for some kind of adjustments if the spending cap is breached.
One issue between the chambers is the approach for making determinations that an
adjustment is needed and how the adjustments should work. Some policy analysts
question the mechanics of these adjustment provisions and have expressed doubt about
their practical implementation.
16
(...continued)
(#2826) offered by Senators Dorgan and Grassley
17
Among the reasons are the historically high farm subsidy levels set by Congress for cotton
and rice relative to other field crops, and high input costs for these crops.
CRS-10
Dairy Policy. Disagreement about the extension, or reauthorization of the
Northeast Dairy Compact and its possible extension to other regions of the country
splits along regional lines. The House farm bill does not extend the NE Dairy Compact
(which expired September 30, 2001). Efforts to include an extension of this compact
in S. 1731 threatened to delay or stop deliberations in the Senate and a compromise
proposal was included in the finally approved Senate bill that would replace the NE
Dairy Compact. This alternative would create a new counter-cyclical payment program
for dairy farmers in all states, with one quarter of the $2 billion allotted for the program
going to Northeast states. The earmark of funds for the Northeast is intended to offset
the loss of the higher farm milk prices permitted by the now defunct Compact.
Providing direct federal assistance to dairy farmers (rather than setting prices that pass
along higher costs to processors and consumers) concerns some who worry about
further expansions in farm assistance and the federal budget deficit. Others wonder
how this will be viewed by European and other trading competitors that the U.S. is
putting pressure on to reduce their domestic support programs.
Conservation Programs. Major points of contention include questions about
how much funding should be provided for these programs versus farm commodity
programs, what portion, if any, of the funding should be mandatory, and who should
retain control of water rights when farmers put land into conservation programs
(especially wetland programs).
The Senate bill provides more money for conservation programs ($17.4 billion)
than the House bill ($15.8 billion) over the next ten years. This difference is expected
to be an issue in the Conference Committee, as are some of the new programs in the
Senate bill. Another issue related to conservation is a Senate provision that would
allow USDA to purchase water rights from farmers. This provision evoked considerable
debate about the potential loss of state and local control of water rights to the federal
government through farmer participation in wetlands and other conservation programs.
Moreover, some farm groups have indicated that they would rather have no farm bill
than one that permits greater federal control of water rights. Conversely, some
environmentalists, although supportive of many of the new initiatives in the Senate bill,
worry that the efforts of some to use conservation programs to increase farm payments
may weaken the environmental and conservation standards for participating in these
programs. There also are some concerns that increased payments for various farm
conservation activities may subject U.S. trade negotiators to complaints that the U.S.
is using environmental concerns to circumvent trade agreements that limit domestic
farm support.
Concentration in the livestock sector. A livestock packers amendment offered
by Senator Tim Johnson and others was accepted during Senate floor debate. It would
prohibit meat packers from owning or controlling livestock within 14 days of slaughter.
Designed to help protect livestock producers from price manipulation by large meat
packing companies, this amendment drew fire from some. Opposition centered on the
fact that the amendment did not apply to poultry (a growing competitor to beef and
pork), and that it might endanger the use of marketing contracts. Some believe that
these contracts help producers and processors plan and market their goods to the
benefit of both. However, there are others who see contracts (especially the
confidentiality clauses in them), as a way for processors to unfairly manipulate the
prices they pay for livestock, and keep producer prices low. The restriction is supported
CRS-11
by the American Farm Bureau and Iowa Pork Producers Association, two major farm
interest groups. It is opposed by most meat processors and some livestock producers.
An amendment modifying the meatpacker restrictions to clarify that they do not affect
livestock under marketing contracts was adopted during Senate deliberations. Another
amendment calling for a study of this prohibition also was adopted. The restrictions on
packer ownership are expected to be a sticking point in conference deliberations.
Comparison Caveats
The following table compares current law or policy with selected provisions in the
House-passed farm bill (H.R. 2646) and the Senate Amendment to H.R. 2646 approved
by the Senate. It updates an earlier version that presented the Daschle substitute to S.
1731 (S. Amdt. 2471) for comparison with the House bill. It is intended to assist those
interested in the major issues before the Conference Committee that will be deliberating
on the next farm bill, and to identify the major differences from current law, and
between the House and Senate bills. It is not a comprehensive comparison of all of the
provisions in each of the bills and current law. Covering all of the provisions in these
bills and comparing them to current law and each other is not feasible given the size of
the bills (especially the Senate bill) and the time constraints on its usefulness. Thus, this
report narrows its scope to compare significant changes being proposed and areas of
major difference between each of the chambers’ bills. Judgments about which
provisions to include were made by each of the CRS specialists covering the relevant
titles, with some modifications by the coordinator and additions by the coordinator.
The report presents the comparison under topics, using the Titles of the farm bills
as the organizing theme (although this does not work in all cases because of the
differences in the bills’ configurations). It is presented as much as possible in the same
order as the House and Senate bills, but the sections are not necessarily in the same
order as the bills. Rather, they are grouped by topic. Funding information in this
report is based on CBO estimates, unless otherwise noted. In several instances changes
to one title of a bill impact on other titles. For instance, the commodity payment limit
in the Senate bill (under Title I) allows additional funding for nutrition programs (Title
IV). This is noted in most cases where it occurs, and explains why budget estimates
displayed by title may differ from those displayed by program. Analysts have tried to
cross-reference provisions presented under the outlines categories. The report tries to
follow the order and organization of the House and Senate bill presentations but is not
able to do so in all instances.
CRS-12
Comparison of Selected Provisions: Current Law and House and Senate Farm Bills
(H.R. 2646 and the Senate Amendment)
I. COMMODITY PROGRAMS
COMMODITY PROGRAMS CURRENT LAW/POLICY
Title:
Federal Agriculture Improvement and
Reform (FAIR) Act of 1996 (P.L. 104127) [ Section 101]
HOUSE BILL
Farm Security Act of 2001. [Section 1]
SENATE BILL
Agriculture Conservation and Rural
Enhancement (ACRE) Act of 2001. [Section
1]
Definitions:
1. “Considered Planted” is defined under 1. No provision
the FAIR Act to mean “acreage considered
planted” under Title 5 of the Agricultural
Act of 1949, and other acreage the
Secretary considers fair and equitable.
This includes: (a) any reduced or diverted
acreage; (b) acreage that could not be
planted because of drought, flood or other
natural disaster or condition beyond farmer
control; (c) acreage equal to the difference
between permitted acreage for a crop and
the planted crop if it is devoted to
conservation uses or the production of
commodities permitted under programs for
crop years 1991-1997; (d) any acreage the
Secretary determines is necessary to
establish a fair crop acreage base; (e)
acreage up to 20 percent of crop acreage
base for feed grains or wheat if planted to
dry peas and lentils; and (f) the crop
acreage base if producers forego farm
1. The definition of “Considered Planted”
is revised to mean any acreage planted that
producers were prevented from planting
because of a drought, flood, or other natural
disaster or condition beyond control of the
owner or producer, as determined by the
Secretary, and any acreage not planted to
another contract commodity (except for a
contract commodity produced under an
established practice of double cropping).
[Section 102]
CRS-13
COMMODITY PROGRAMS CURRENT LAW/POLICY
HOUSE BILL
SENATE BILL
payments and do not plant to the crop or
any fruit or vegetable not designated as
industrial or experimental. [Sec. 102(2)of
FAIR Act and Section 503(c) of the
Agricultural Act of 1949 (which is one of
several permanent laws whose provisions
often are suspended or temporarily or
permanently revised or amended by farm
bills)]
2. “Contract” and “Production 2. No Provision
Flexibility Contract” defined to mean a
contract entered into under the terms of
Section 111 of the FAIR Act of 1996,
which establishes fixed , annual, lump sum
payments to farmers. [Section 102(3) of
the FAIR Act]]
2. Defines “Contract” as a contract entered
into under subtitle B, Nonrecourse Marketing
Assistance Loans and Loan Deficiency
Payments. [Section 102]
3 . “Contract Acreage” is defined to mean 3. No Provision
one or more crop acreage bases established
for contract commodities under Title V of
the Agriculture Act of 1949 that would
have been in effect for the 1996 crop but
for the suspension of existing target price
support programs under Section 171 (b)(1)
of the Fair Act of 1996.[Section 102]
3. Redefines “contract acreage” to mean the
acreage determined under section 111(f) of
the bill, which refers to “direct and countercyclical payments.”
(Section 102(4)]
4. “Contract Commodity” is defined to
mean wheat, corn, grain sorghum, barley,
oats, upland cotton, and rice. [Section
102]
5. “Contract Payment” is defined to
mean production flexibility contract
4. “Covered Commodity” replaces 4. “Contract Commodity” is redefined to
“covered” for “contract” and adds soybeans, add oilseeds to current law. [Section 102]
and other oilseeds to current law . [Section
100]
CRS-14
COMMODITY PROGRAMS CURRENT LAW/POLICY
HOUSE BILL
payments to wheat, corn, grain, barley, 5. No provision
oats, upland cotton and rice farmers
[Section 102]
SENATE BILL
5. “ Contract Payment” is a payment made
to wheat, corn, grain sorghum, barley, oats,
upland cotton, rice and oilseed farmers under
Subtitle B, Nonrecourse marketing assistance
loans and loan deficiency payments. [Section
102]
6. “Counter-cyclical Payment”
No provision
6. “Counter-cyclical Payment” means a 6. No definition
payment made to producers under section
105, Availability of Counter-cyclical
Payments. [Section 100]
7. “Fixed Decoupled Payment”
7. “Fixed Decoupled Payment” means a 7. No definition.
payment made to producers under section 104
Availability of Fixed Decoupled Payments.
[Section 100]
8. “Farm Program Payment Yield” 8. “Payment Yield” is the yield established 8. “Payment Yield” means the payment yield
means the farm program payment yield under section 102 for a covered commodity. determined under Section 111(g) [Section
established for the 1995 crop of a contract [Section 100]
102]
commodity under section 505 of the
Agriculture Act of 1949 [Section 101]
9.“Target price
No provision
NOTE: Eliminated for most field commodities
by the AMTA of 1996.
9. “Target Price”means the price per bushel 9. No provision
(or other appropriate unit) of a covered
commodity used to determine the payment
rate for counter-cyclical payments.[Section
100]
CRS-15
COMMODITY PROGRAMS
CURRENT LAW/POLICY
Agricultural Market Transition Act
(AMTA), Title I of the Federal
Agriculture Improvement and Reform
Act of 1996, Subtitles B, C, D, and E,
and miscellaneous agriculture laws.
HOUSE BILL
SENATE BILL
Farm Security Act (FSA) of 2001, Title I,
Subtitles A, B, and D.
Agriculture, Conservation and Rural
Enhancement (ACRE) Act of 2001, Title 1,
Subtitles A and B.
A. GRAINS et. al. (Wheat, Corn, Grain Sorghum, Barley, Oats, Upland Cotton, Rice, Soybeans and Minor Oilseeds)
1. Fixed, Decoupled Payments
a. Eligibility
Eligibility for PFC contracts is extended
to producers previously enrolled in a
grain or cotton program in at least 1 of
the 1991-95 crop years. Conservation
Reserve Program cropland expiring or
terminated after Jan. 1, 1995 is eligible.
Soybeans and minor oilseeds are not
eligible PFC commodities. [Section 111]
[NOTE: Payment limits are covered
under section N]
Farms with existing PFC contracts, and
other producers with a history of contract
crop or oilseed production from 1998-01
are eligible to sign up for fixed, decoupled
payments. Soybeans and minor oilseeds
also are made eligible for what will be
known as “agreement” crops. Provision is
made for expiring CRP acres to be added to
the agreements. [Section 101(a) and
103(a)]
Same as House bill. [Section 111]
Establishes a sign-up period, lasting not
more than 180 days after enactment, during
which producers sign “agreements”
covering crop years 2002 thru 2011 (10
years). [Section 110]
Establishes a sign-up period, that begins not
less 45 days after enactment and lasts for 180
days, during which producers sign “contracts”
covering crop years 2002 thru 2006 (5 years).
[Section 111]
b. Sign-Up Period
The sign-up period is required to begin
not later than 45 days after enactment
and end August 1, 1996. Production
flexibility contracts (PFCs) cover 7 years,
1996 thru 2002 crops. [Section 112]
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d. Conservation and Wetlands
Compliance
Same as current law. [Section 106]
Same as current law. [Section 111 as it
amends Section 111 of FAIR Act]
Farmers are allowed to plant any crop
except fruits and vegetables (other than
lentils, mung beans, and dry peas) on
contract acreage and there are no
planting restrictions on non-contract
acreage. Cropland not planted has to be
devoted to a conserving use to prevent
erosion and can not be converted to nonagricultural uses. [Section 118]
Same planting flexibility allowance as
current law, but wild rice is added to
exceptions. [Section 107]
Same planting flexibility allowance as current
law, but wild rice is added to exceptions
beginning in 2003. [Section 113]
Violations of planting flexibility
limitations generally result in termination
of the contract on each farm in which the
producer has an interest. [Section 116]
No provisions for violations.
For first time, unintentional violations of
planting flexibility limitations, the penalty shall
be a refund or reduction of future payments
amounting to twice the payment amount on
the involved acres. [Section 112]
Producers are required to comply with
already existing conservation
requirements on highly erodible land and
with already existing prohibitions on
draining wetlands for purposes of crop
production. These compliance
requirements did not impose any new
obligations on producers. [Section 111]
e. Planting Flexibility and Limitations
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f. Program Base Acres and Payment
Yields
Each farm’s base acres and payment
yields are used to calculate the program
benefits to the producer. The base acres
and yields for eligible crops are those that
would have applied in 1996 under the
then expiring program. Under the
expiring program, the “acreage base” for
each program crop is the average acres
planted/considered planted the prior 5
years for wheat, feed grains and the prior
3 years for upland cotton, rice. [Section
102]
Program payment yields for each crop
are frozen at 1986 program levels.
[Section 102]
[Note: Soybeans and minor oilseeds are
ineligible under current law and there are
no provisions for establishing base acres
and yields for oilseeds.]
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Base acres for each crop are either the acres
specified in existing contracts, or average
acres planted to eligible crops from 1998
thru 2001. Accommodation is made for
double cropping, peanut acres, and CRP
acres. Base acres cannot exceed total
cropland on a farm. [Section 103]
Same as House bill. [Section 111]
The program payment yield for each crop is
the: payment yield in effect for 2002 under
an existing production flexibility contract; or
a similarly appropriate yield for farms
without past contracts. Oilseed yield is the
average yield from 1998-01, adjusted back
to a 1981-85 equivalent. [Section 102]
Payment acres equal 85% of base acres in
calculating payment amounts. [Section
100(9) and 103(f)]
The program payment yield is either: the yield
specified in existing contracts, or average
yield from 1998 thru 2001. There is no
requirement to adjust yields back to an 198185 equivalent. In calculating payment
amounts, payment acres are 100% of base
acres. [Section 111]
Same as current law. [Section 106(c)]
Same as current law. [Section 111]
g. Change in Farm Ownership or
Operator
Contract obligations can be assumed by
new owners. Otherwise the contract is
terminated. Changing operators does not
affect program acres or yields. [Section
117]
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Farmers who sign production flexibility
contracts (PFC) in 1996 receive fixed
annual payments for 7 years, unrelated to
crops or acreage actually planted. The
payment quantity for each commodity is
85% of the contract acreage times the
payment yield times the payment rate.
[Section 114]
Similar framework to current law.
Farmers who sign “agreements” receive
fixed, decoupled annual payments for 10
years, unrelated to crops or acreage actually
planted. The payment quantity for each
commodity is 85% of payment acres times
the payment yield times the payment rate.
[Section 104]
Similar framework to current law.
Farmers who sign contracts receive fixed,
decoupled annual payments for 5 years,
unrelated to crops or acreage actually planted.
The payment quantity for each commodity is
100% of payment acres times the payment
yield times the payment rate.[Section 111]
Estimated 2002 contract payment rates:
Payment rates are specified for all years as
follows:
Wheat, $0.53/bu
Corn, $0.30/bu
Sorghum, $0.36/bu
Barley, $0.25/bu
Oats, $0.025/bu
Cotton, $0.0667/lb
Rice, $2.35/cwt
Soybeans, $0.42/bu
Minor Oilseeds, $0.0074
Payments rates are specified for 2002/03,
2004/05, 2006 as follows:
Wheat, $0.45, $0.225, $0.113/bu
Corn, $0.27, $0.135, $0.068/bu
Sorghum, $0.31/$0.27, $0.135, $0.068/bu
Barley, $0.20, $0.10, $0.05/bu
Oats, $0.05, 0.$025, $0.013/bu
Cotton, $0.13, $0.065, $0.0325/lb
Rice, $2.45, $2.40, $2.40/cwt
Soybeans, $0.55, $0.275, $0.138/bu
Minor Oilseeds, $0.01, $0.005, $0.0025/bu
Total payments are to be reduced by $100
million on a pro rata basis (about 2% based
on CBO estimates) and these funds are to be
devoted to specified rural development
programs. [Section 943]
No comparable provision.
h. Payment Rates (see also Payment
limits under subsection N of this section)
Wheat, $0.46/bu
Corn, $0.26/bu
Sorghum, $0.31/bu
Barley, $0.20/bu
Oats, $0.021/bu
Cotton, $0.0556/lb
Rice, $2.04/cwt
Soybeans, not a contract crop
Minor Oilseeds, not contract crops
The law does not specify actual payment
rates, but states the total funds available
each year and the allocation share for
each commodity. [Section 113]
No provision
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Not relevant
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FY2002 PFC payments under current law
are to be discontinued after enactment, and
any amount already paid is to be deducted
from the amount due under this Act.
[Section 108]
No explicit reference is made to discontinuing
payments under PFC contracts, or to
payments already made under to old law.
The producer can choose to receive 50% of
the payment on or after December 1 and the
rest will be payed not later than September
30 of each fiscal year. [Section 104(d)]
Same as House bill. [Section 111]
i. Time of Payment
The producer can choose to receive 50%
of the payment on December 15 or
January 15 and the remainder not later
than September 30 of each fiscal year.
[Section 112(d)(1 and 2)]
Alternatively, for FY1999-02, the
producer can choose to receive the full
amount or portions at times during the
fiscal year chosen by the producer.
[Section 112(d)(3) as added by PL 105228, Section 2]
2. Counter-Cyclical Deficiency Payments and Target Prices
a. Eligibility
Eliminates counter-cyclical target price
deficiency payments that were enacted in
1973 and functioned through 1995.
When effective, farmers were paid the
difference between the target price and a
lower season average farm price on a
Restores counter-cyclical target price
deficiency payments that ended in 1995.
Farms that have signed agreements are
eligible to receive counter-cyclical payments
each year that average market prices are less
than target prices. [Section 101]
Same as House bill. [Section 111]
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The payment amount for each commodity is
85% of payment acres times the payment
yield times the payment rate. The payment
rate is the difference between a) the loan
rate (or average market price if it is higher
than the loan rate) plus the fixed decoupled
payment and b) the “target price.”[Section
105]
Same as House bill, except that the payment
amount for each commodity is 100% of
payment acres times the payment yield times
the payment rate. [Section 171]
Target prices are for all years are specified
as follows:
Wheat, $4.04/bu
Corn, $2.78/bu
Sorghum, $2.64/bu
Barley, $2.39/bu
Oats, $1.47/bu
Upland Cotton, $0.736/lb
Rice, $10.82/cwt
Soybeans, $5.86/bu
Minor Oilseeds, $0.1036/lb
Target prices are for all years are specified as
follows:
Wheat, $3.446/bu
Corn, $2.3472/bu
Sorghum, $2.3472/bu
Barley, $2.1973/bu
Oats, $1.5480/bu
Upland Cotton, $0.6793/lb
Rice, $9.2914/cwt
Soybeans, $5.7431/bu
Minor Oilseeds, $0.1049/lb
specified proportion of the a farm’s crop
base acres.
NOTE: Payment limits are discussed
under subsection N of this section.]
b. Target Prices and Payment Rates
Not applicable.
3. Marketing Assistance Loans and LDPs
a. Eligibility
Any wheat, feed grains, upland cotton,
and rice produced on PFC farms is
Marketing assistance loans and loan
deficiency payments (LDPs) are available
Same as House bill. [Section 121, 122]
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eligible for marketing assistance loans or
LDPs, whether or not it is produced on
contract acres. These commodities are
not eligible for loan or LDPs if produced
on farms without contracts. Any oilseed
is eligible for marketing assistance loans
or LDPs, whether or not the farm has a
contract. [Section 131]
[See Payment limits under subsection N.]
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for agreement crops (grains, upland cotton,
oilseeds) on all farms where they are
produced, whether or not they have signed
agreements). [Section 121]
b. Term of Loans
Loans on grains and oilseeds are for 9
months beginning on the first of the
month after the loan date. Loans on
upland cotton are for 10 months
beginning on the first of the month before
the loan date.
Same as current law. [Section 123]
Same as current law. [Section 124]
Same as current law. [Section 124]
Same as current law. [Section 125]
c. Loan Repayment
For grains and oilseeds, marketing
assistance loans can be repaid at the
lesser of the loan rate plus interest, or the
rate determined by USDA that minimize
forfeitures, minimize the accumulation of
CCC-owned stocks, minimize the cost of
storage, and allow for free and
competitive domestic and international
marketing. [Section 134]
For upland cotton, loans can be repaid at
the lesser of the loan rate plus interest, or
the prevailing world market price
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adjusted to U.S. quality and location.
Additional adjustments to the world price
are made when the world price declines
to near the loan rate , and when the price
of U.S. cotton exceeds the price of
competing cotton in the world market.
[Section 134]
In the event of a default on a loan at the
maturity date, the commodity pledged as
collateral reverts to CCC ownership. No
further action is taken against the
borrower because marketing assistance
loans are nonrecourse. [Section 131]
d. Loan Deficiency Payments (LDPs)
Producers with grain, upland cotton, or
oilseeds eligible for marketing assistance
loans instead can choose to receive loan
deficiency payments. The LDP is the
difference between the loan rate and the
loan repayment rate established by the
USDA. [Section 135]
Same as current law. [Section 125]
Same as current law. [Section 126]
Loan rates generally are to be not less than
85% of the moving 5-year Olympic average
of prices received by producers, or more
than:
Fixed, specific loan rates are as follows:
e. Loan Rates
Marketing assistance loans and loan
deficiency payments (LDPs) continue at
1995 rates. Authority is provided for
USDA to lower the loan rates when
stocks accumulate. Loan rates generally
are to be not less than 85% of the moving
5-year Olympic average of prices
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received by producers, or more than:
Wheat, $2.58/bu
Corn, $1.89/bu
Sorghum, $1.69/bu
Barley, $1.71/bu
Oats, $1.14/bu
Cotton, $0.5192/lb
Rice, $6.50/cwt
Soybeans, $5.26
Minor Oilseeds, $0.093/lb
Rice can not be below $6.50, soybeans
can not be below $4.92, minor oilseeds
can not be below $0.87
[Section 132]
P.L. 106-224, Section 206(a)(2) and (3),
made loans and LDPs available on nonPFC farms only for crop year 2000.
Wheat, $2.58/bu
Corn, $1.89/bu
Sorghum, $1.89/bu
Feed Barley, $1.70/bu
Malting Barley, $1.65/bu
Oats, $1.21/bu
Cotton, max $0.5192-min $0.50/lb
Rice, must equal $6.50/cwt
Soybeans, $4.92/bu
Minor Oilseeds, $0.087/lb
[Section 122]
Wheat, $2.9960/bu
Corn, $2.0772/bu
Sorghum, $2.0772/bu
Barley, $1.9973/bu
Retroactively, for the 2001 crops, as was
the case for 2000, LDPs are available on
non-PFC farms that produced contract
crops and oilseeds. [Section 125(f)]
Same as House bill [Section 169]
Same as current law.
Marketing loans and LDPs are available on all
production at the following rates:
Dry Peas, $6.78/cwt
Lentils, $12.79/cwt
Large Chickpeas, $17.44/cwt
Oats, $1.4980/bu
Cotton, $0.5493/lb
Rice, $6.4914/cwt
Soybeans, $5.1931/bu
Minor Oilseeds, $0.0949/lb
[Section 171]
[See Payment limits under Subsection N]
B. OTHER COMMODITIES
a. Dry Peas, Lentils and Chickpeas
1. Marketing Loans and LDPs
No support is authorized for dry peas,
lentils, large chickpeas, small chickpeas.
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Small Chickpeas, $8.10/cwt
The term of each loan is 9 months, beginning
the first day of the month after the loan is
obtained. [Section 171 as it amends Section
111]
b. Grazed Wheat, Barley, and Oats
1. Payments in Lieu of LDPs
P.L. 104-127 made no provision for
LDPs on grazed wheat, barley and oat
acreage. P.L. 106-224, Section 205,
provided for LDPs on grazed acres only
for 2001 crops.
Wheat, barley, and oats that are grazed and
not harvested, but would be eligible for
LDPs if harvested, will receive LDPs under
similar rules to those that apply to harvested
crops. Federal crop insurance is not
allowed on grazed land agreements.
[Section 126]
Similar to House bill, but includes grain
sorghum along with wheat, barley and oats as
eligible crops. [Section 127]
For farms that normally harvest corn or
sorghum in a high moisture condition,
recourse loans are available at rates set by
the USDA. Farms need not have signed
“agreements.” [Section 129(a)]
No provision is made to support high
moisture corn or sorghum.
c. High Moisture Corn and Sorghum
1. Recourse Loans
Recourse loans are available on high
moisture corn and grain sorghum. Loan
rates are determined by the USDA. Only
producers with PFC contracts are
eligible. [Section 137(a)]
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Recourse loans are available for all upland
and ELS seed cotton, at rates set by the
USDA. Farms need not have signed
“agreements.”[Section 129(b)]
No provision is made to support seed cotton.
Same as current law. [Section 122]
Marketing assistance loans for ELS Cotton
are equal to $0.7965/lb.[Section 171]
d. ELS and Seed Cotton
1. Recourse Loans
Recourse loans are available on upland
seed cotton for farms with PFC
contracts, and on any farm producing
ELS seed cotton. [Section 137(b)]
2. Marketing Assistance Loans
Marketing assistance loans for ELS
Cotton are to be not less than 85% of the
moving 5-year Olympic average of prices
received by producers, or more than
$0.7965/lb.[Section 132]
e. Hard White Wheat Incentive Payments
1. Incentive Payments
No special support provision is added for
hard white wheat. However, hard white
wheat, like all other wheat, does qualify
for contract payments and marketing loan
program benefits.
Same as current law, no added support
provision is made for hard white wheat.
For crop year 2003 through 2005, an
additional $40 million is to be paid to
producers to ensure that hard white wheat on
not more than 2 million acres meets minimum
quality standards. [Section 164]
f. Cotton Competitiveness Provisions for Processors and Exporters
1. Marketing Certificates
Marketing certificates or cash payments
are made to domestic users and exporters
of upland cotton whenever the 4-week
Some changes from current law.
Marketing certificates or cash payments are
made to domestic users and exporters of
Same as current law. [Section 121(b)]
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price of U.S. cotton gets too high
compared to world cotton price (i.e.,
1.25¢/lb higher), or is not high enough
compared to the U.S. cotton loan rate
(i.e., less than 130% higher). [Section
136(a)]
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upland cotton whenever the 4-week price of
U.S. cotton gets too high compared to
world cotton (i.e., 1.25¢/lb higher), or is not
high enough compared to the U.S. cotton
loan rate (i.e., less than 134% higher).
[Section 127(a)]
2. Import Quotas
A special import quota is imposed on
upland cotton when U.S. prices exceed
world prices by 1.25¢ for 10 weeks.
[Section 136(b)]
A special import quota is imposed on
upland cotton when U.S. prices exceed
world prices by 1.25¢ for 4 weeks. [Section
127(b)]
Same as current law. [Section 121(b)]
A limited global import quota is imposed
on upland cotton when U.S. prices
average 130% of the previous 3-year
average of U.S. prices. [Section 136(c) ]
Same as current law. [Section 127(b)]
Same as current law. [Section 121(b)]
Retains same nonrecourse loan rates as
current law, 18¢/lb. raw cane, and 22.9¢/lb.
refined beet by preserving Section 156(a) &
(b) of the FAIR Act. [Section 151(a)]
In-process sugar is newly eligible for loan at
80% of full loan rates. [Section 151(e)]
Loan rates may be reduced if competing
Same loan rates as current law.
Same in-process sugar loans as House bill.
[Section 141(e)]
Same authority to reduce loan rates as House
bill. [Section 141(a)]
g. Sugar
1. Price Support Loans
Raw cane sugar and refined beet sugar is
supported with nonrecourse loans at 18¢
and 22.9¢/lb respectively. [Section
156(a) and (b)] The loan rates may be
reduced if negotiated reductions in
support are achieved for other sugar
countries. [Section ]156(c)] A recourse
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loan program when the tariff rate quota
on imports is less than 1.5 million short
tons was eliminated by P.L. 106-387,
Section 836.
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nations sufficiently reduce support. [Section
151(c)]
2. No Net Cost Mandate
No provision mandating no net cost.
Loan programs to be operated at no net cost
by avoiding forfeitures. [Section 151(f)]
Same no cost policy as House bill. [Section
141(f)]
Forfeiture penalty is retained by preserving
Section 156(g) of the FAIR Act.
The loan forfeiture penalty is eliminated.
[Section 141(d)]
No change from current law.
Same as House bill, except authorizes the
USTR in consultation with the USDA to
reallocate any shortfall of sugar not shipped
against a country’s share of its sugar import
quota to other quota-holding countries
[Section 144]
3. Loan Forfeiture Penalty
A forfeiture penalty of 1¢ per pound on
raw cane sugar (an equivalent amount for
beet sugar) is assessed on loan
forfeitures. This effectively reduces the
level of support. [Section 156(g)]
4. Import Quotas
A global import quota of not less than
1.256 million short tons is set each year
by USDA under authority of the
Harmonized Tariff Schedule of the
United States. The quota is allocated
among countries by U.S. Trade
Representative. [HTSUS, chapter 17,
additional U.S. note5. USTR announces
a separate allocation for additional sugar
entering from Mexico as agreed in the
sugar side letter to NAFTA.]
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Sugar marketing allotments are restored and
are to be shared between beet sugar and raw
cane at 54.35% and 45.65%. Allotments
are suspended when imports exceed 1.532
million short tons. [Section 152]
Similar to House bill, but provision is made
for new cane processor entrants (including
mainland states not previously producing
cane). [Section 143]
CCC is authorized to make in-kind
commodity payments from stored
inventories to processors in exchange for
reduced sugar production. [Section 151(f)]
Same authority to make in-kind payments for
reduced production as House bill. [Section
141(f)]
The assessment on all sugar marketings is
eliminated. [Section 151(b)]
Same as House bill. [Section 141(c)]
Interest rate on loans is equal to CCC cost
of funds. This is 1% less than the interest
rate for other commodities. [Section
151(h)]
Same interest rate on loans as House bill.
[Section 141(j)]
5. Marketing Allotments
The authority to impose mandatory
marketing allotments on domestic sugar
production is suspended. [Section
171(a)(1)(E)]
6. In-Kind Payments
No provision.
7. Marketing Assessment
Processors must pay an assessment on all
marketings of sugar to CCC equal to a
specified percentage of the loan rate.
[Section 156(f)] P.L. 106-78, Section
803(b), suspended the assessment for
FY2000 and FY2001. P.L. 107-76,
Section 749, delays remittance of 2002
assessments until September 2, 2002.
8. Interest Rate on Loans
The interest rate on loans is 1% above
the CCC cost of borrowing money.
[Section 163]
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9. Storage Facility Loans
No provisions for storage facility loans.
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Storage facility construction and
improvement loans are to be made available
to processors. [Section 153]
Same as House bill. [Section 142]
Peanut quotas are terminated and farmers
are compensated $1,000/ton (50¢/lb)
($200/ton/year for 5 years). [Section 170]
Similar to House bill, except quota
compensation is $1,100 (55¢/lb)
($220/ton/year for 5 years). [Section 152]
Nonrecourse loans are replaced by
marketing assistance loans. Marketing
assistance loans set at $350/ton (17.5¢/lb)
available for all peanut production without
distinction of end use. [Section 167]
Marketing assistance loan rate set at $400/ton
(20¢/lb) available for all peanut production
without distinction of end use. [Section 151 ]
Support for peanuts designed like that for
grains, cotton, and oilseeds. Rules
Similar to House bill. [Section 151
h. Peanuts
1. Poundage Quotas and Nonrecourse
Loans
National poundage quota is set to reflect
the projected domestic demand for edible
peanuts. [Section 155]
2. Non-recourse Marketing Assistance
Loans
The price of peanuts sold for domestic
edible consumption (quota peanuts) is
supported through nonrecourse loans at
$610/ton (30.5¢/lb). The price of
additional peanuts (nonquota peanuts,
those exported or crushed for oil and
meal) is supported at a competitive level
(set by USDA at $132/ton, 6.6¢/lb, in
2001). [Section 155]
3. Fixed Payments, Counter-Cyclical
Payments
No provisions for fixed payments or for
counter-cyclical payments for peanuts.
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regarding eligibility, sign-up, conservation
and wetlands compliance, planting
flexibility, base acres, payment yields, etc.,
are similar to those that apply to grains,
cotton, and oilseeds.
The assignment of each farm’s acres and
yield to cropland selected by the producer is
done on a one-time basis. [Section 162(b)]
Similar to House bill. [Section 151]
Fixed, decoupled annual payments at the
rate of $36/ton (1.8¢/lb) are made on 85%
of each farm’s history of peanut production.
[Section 163]
Fixed, decoupled contract payments at the
same rate as the House bill. [Section 151]
Counter-cyclical deficiency payments
against a $480/ton (24¢/lb) target price are
made on 85% of each farm’s history of
peanut production. [Section 164]
Counter-cyclical deficiency payments against a
$520/ton (26¢/lb) target price are made on
85% of each farm’s history of peanut
production. [Section 151]
Payments limits for peanuts are treated
separately from those set for other
commodities. Fixed, decoupled payments
for peanuts are subject to a limit of $50,000
per person, per year. The limit on countercyclical target price deficiency payments is
$75,000, and the limit on marketing loan
benefits is $150,000. [Sections 169 and
183]
Payments received for support of peanuts are
subject to the same limits as other crops, and
are included in the payment totals set for other
crops, rather than treated separately as in the
House bill. For all crops, the combination of
fixed, decoupled payments and countercyclical payments is limited to $75,000 per
individual, per year. Marketing loan benefits
are limited to $150,000. Raised limit by and
additional $50,000 for a qualifying married
couple. [Section 169]
3. Peanut Payment Limits
Payment limits are not applicable to
peanuts under current law.
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Marketing loans and LDPs are available to
all producers at the following rates:
Similar to House bill, except no support for
mohair.
Marketing loans and LDPs are available to all
producers at the following rates:
Graded Wool, $1.00/lb
Nongraded Wool and Unshorn Pelts, 40¢/lb
Mohair, (see note below)
[ Sections 123 and 171]
i. Wool and Mohair
1. Marketing Loans and LDPs
Wool and mohair support was phased out
and ended in 1996 by P.L. 103-130,
Section 1, which repealed the National
Wool Act of 1954. However, support
was authorized in several subsequent
years. P.L. 106-78 Section 801(h),
authorized recourse loans on 1999 crop
mohair. P.L. 106-224, Section 204(d),
mandated payments on 1999 crop wool
of $0.20, and on mohair of $0.40/lb. P.L.
106-387, Section 814, authorized
payments of $0.20/lb for wool and $0.40
mohair for crop year 2000, up to $20
million. Again for crop year 2001, P.L.
107-25, Section 5, authorized $16.9
million in direct payments for wool and
mohair at rates determined by
USDA.[Section 132 of the FAIR Act of
1996]
Graded Wool, $1.00/lb
Nongraded Wool, 40¢/lb
Mohair, $4.20/lb
[Section 130]
[Note: Section 123 of the Senate-passed bill
does not include mohair among the list of loan
rates for marketing assistance. However,
section 171 of the same bill includes a loan
rate of $2.00 for mohair. This section
amended the loan rates set under section 123,
and was added to fund improvements in
nutrition assistance. The originally introduced
version of S. 1731 contained a mohair loan
rate, but it was dropped in the Daschle
substitute and a conforming change reflecting
this was not contained in section 171.]
j Honey
1. Marketing Assistance Loans and
LDPs
Honey support is repealed. [Section 171]
Note: This action followed several years
Marketing loans and LDPs at $0.60/lb. The
term of a loan is 12 months, beginning the
first day of the month after the loan is
Marketing loans and LDPs at $0.60/lb. The
term of the loan is 9 months, beginning the
first day of the month after the loan is
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of agriculture appropriations bill language obtained. [Section 131]
preventing USDA from carrying out the
mandatory honey marketing loan
program.
Recourse loans were authorized for the
1998, 1999, and 2000 crops by
respectively P.L. 105-227, Section 1122;
P.L. 106-78, Section 801; and P.L. 106224, Section 204. P.L. 106-387, Section
812, made marketing assistance loans and
LDPs available on 2000 crop honey at
$0.65/lb and outstanding recourse loans
were converted to nonrecourse marketing
loans.
SENATE BILL
obtained.[Section 171]
k. Dairy
1. Dairy Price Support Program
(DPSP)
The 1996 farm bill (P.L. 104-127), as
amended, reauthorizes the DPSP at the
current level of support ($9.90 per
hundredweight (cwt.) of milk). [Section
141]
The DPSP indirectly supports the farm
price of milk through USDA purchases of
surplus cheese, butter and nonfat dry milk
(powder). The law allows the Secretary
of Agriculture to adjust government
purchase prices of butter and powder
twice annually in order to minimize
government expenditures. The FY2002
agriculture appropriations act (P.L. 107-
Extends the DPSP through December 31,
2011 at the current level of support ($9.90
per cwt.). The Secretary would be
permitted to adjust purchase prices of butter
and nonfat dry milk twice annually to
minimize government expenditures on the
program. [Section 141]
Extends the DPSP through December 31,
2006 at the current level of support ($9.90 per
cwt.). The Secretary would be required to
adjust purchase prices of butter and nonfat dry
milk twice annually to minimize government
expenditures on the program. [Section 131]
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76) extended the DPSP through May 31,
2002 [Section 772(a)]
2. The Northeast Dairy Compact and
Counter-Cyclical Payments for Dairy
Farmers
The 1996 farm bill (P.L. 104-127) gave
contingent authority for the six New
England states to create an interstate
dairy compact. [Section 147] The
compact required fluid milk processors in
New England to pay a minimum price
for farm milk used for fluid consumption
that is higher than the minimum price
established under federal regulation.
Compact was established in 1997 at a
minimum price of $16.94 per
hundredweight (cwt.). Legislative
authority expired on September 30, 2001.
No provisions.
Replaces the Northeast Dairy Compact with a
new counter-cyclical payment program for
dairy farmers through September 30, 2005.
Whenever the minimum price for fluid farm
milk falls below a target price of $16.94 per
hundredweight (cwt.) in 12 Northeast states
(ME, NH, VT, CT, RI, MA, NY, NJ, PA,
MD, DE, WV), farmers in these states receive
a direct government payment to compensate
for 45% of the difference between the target
price and the monthly minimum market price
for fluid farm milk. Farmers in all other states
receive a federal payment when the average
market price for farm milk in any quarter falls
short of a 5-year average market price for that
quarter. Each producer receives a payment
equal to 40% of the market price shortfall
from the 5-year average. Total funding over
the life of the program is $500 million for the
Northeast states, and $1.5 billion for all other
states. Payments can be received by a farmer
on up to 8 million lbs. of annual milk
production. [Section 132]
Repeals authority for a recourse loan
program. [Section 142]
No provision.
Separately, emergency authority included
in the agriculture appropriations acts of
FY1999 (P.L. 105-277), FY2000 (P.L.
106-78) and FY2001 (P.L. 106-387)
provided ad-hoc direct government
payments to all dairy farmers in response
to volatile farm milk prices.
3. Recourse Loan Program
P.L. 104-127 permanently authorized a
new recourse loan program to help dairy
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processors balance their inventories, to
be implemented once the dairy price
support program (DPSP) expires.
[Section 142]
P.L. 104-127 originally required the
elimination of the DPSP on January 1,
2000. However, subsequent legislation
extended price support authority.
Recourse loan program was never
implemented, and its authority was
repealed by P.L. 107-76.
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(Subsequent to House passage of H.R.
2646, P.L. 107-76 was enacted which
repealed authority for the recourse loan
program. [Section 772(b)])
4. Dairy Export Incentive Program
The 1985 farm bill (P.L. 99-198) first
authorized the dairy export incentive
program, which helps U.S. exporters
counter subsidized sales by foreign
competitors through cash or commodity
bonuses. [Section 153]
Program has been reauthorized
periodically in subsequent farm bills.
Most recently, the 1996 farm bill (P.L.
104-127) reauthorized the program
through 2002. [Section 148]
Extends program authority through 2011.
[Section 143(a)]
Extends program authority through 2006.
[Section 133(a)]
Reauthorizes the program through
September 30, 2011. [Section 143(b)]
Reauthorizes the program through September
30, 2006. [Section 133(b)]
5. Dairy Indemnity Program
Authorized in 1964, the dairy indemnity
program indemnifies dairy farmers and
processors who, through no fault of their
own, suffer income losses due to
contamination of milk or dairy products
caused by pesticides and certain other
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1) Gives permanent authority to the fluid
milk promotion program; 2) strikes the
statutory definition of a fluid milk product
and use the definition promulgated in USDA
regulations; and 3) changes the definition of
a fluid milk processor for the purpose of the
required assessment, to exclude any fluid
processor that handles less than 3 million
pounds of fluid milk products each month.
[Section 144]
Same as House bill, except that fluid milk
delivered directly to consumer residences does
not count toward the 3 million pound
minimum requirement for the processor
assessment. [Section 134]
Extends the 15-cent assessment to imported
dairy products. The 15-cent assessment is to
be paid to U.S. Customs by the importer on
the equivalent of milk that went into the
manufacturing of the imported product.
Dairy importers are allowed up to 2 seats on
the national Dairy Board. None of the
importer-collected funds can be used for
foreign market promotion. [Section 146]
Same as the House bill. [Section 136]
toxic substances. Legislative authority
expired September 30, 1995. However,
annual appropriations have been made
subsequent to program expiration.
6. Fluid Milk Processor Promotion
Program
The Fluid Milk Promotion Act of 1990
(contained within the 1990 farm bill (P.L.
101-624)), as amended, authorized a
research and promotion program for fluid
milk products. [Sections 1999A-1999R]
The program is funded through an
assessment on fluid milk processors who
handle more than 500,000 lbs. of fluid
milk products each month. The 1996
farm bill (P.L. 101-624) extended
program authority through December 31,
2002. [Section 146]
7. Dairy Promotion and Research
Program
The Dairy Producer Stabilization Act of
1983 authorized a national dairy
producer program for generic dairy
product promotion, research, and
nutrition education. The program is
funded through a mandatory 15-cent per
hundredweight assessment on all milk
produced and marketed in the contiguous
48 states. Dairy farmers administer the
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program through the National Dairy
Promotion and Research Board.
8. Dairy Product Mandatory
Reporting
The Dairy Market Enhancement Act of
2000 (P.L. 106-532) established a
mandatory reporting system for dairy
product inventories and prices. It requires
USDA’s National Agricultural Statistics
Service to regularly collect data on the
prices and inventories of cheese, butter
and nonfat dry milk sold by dairy
manufacturers.
9. Dairy Studies
No provision in current law.
Makes a technical correction to the 2000 act
to include “substantially identical products
designated by the Secretary (of
Agriculture)” as part of the mandatory
reporting system. [Section 145]
Similar to the House bill. [Section 135]
Requires the Secretary of Agriculture to
submit to Congress a comprehensive
economic evaluation of national dairy
policies (i.e., the price support program,
federal milk marketing order, over-order
premiums and state pricing programs, dairy
compacts and export programs) and their
effect on the farm and rural economy,
domestic food and nutrition programs, and
consumer costs. [Section 147]
Requires the Secretary of Agriculture to
conduct studies to be reported to the House
and Senate Agriculture Committees on: 1) the
market effects of terminating all federal dairy
programs relating to price support and supply
management; and 2) the effects of changing
the standard of identity for fluid milk so that
the required minimum protein content of fluid
milk is commensurate with the average nonfat
solids contents of farm milk directly from the
cow. [Section 137]
[Note: California has a standard of identity for
fluid milk that requires a nonfat solids content
higher than the national requirement and
higher than the average content of raw milk
from the cow.]
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l. Tobacco
1. Flue-cured Quota
No provisions.
Same as current law.
Reduces the reserve stock level for flue-cured
in the quota determination formula from the
greater of 100,000 pounds or 10% of the
national marketing quota, to the greater of
75,000 pounds or 10%. [Section 162]
2. Flue-cured Farm Reconstitutions
No provisions
Same as current law.
Allows, for the 2002 crop only, for special
farm reconstitutions that otherwise would
violate the prohibition on flue-cured lease and
transfer of quota. Requires a study of the
prohibition of flue-cured quota lease and
transfer. [Section 163]
m. Specialty Crops
1. Mandatory CCC Purchases
No provisions of P.L. 104-127
specifically authorize or mandate support
for specialty crops. Subsequently,
emergency ad hoc assistance was
mandated for specialty crops. P.L. 106224, Section 203(d), mandated the CCC
spend $200 million for purchases fruits
and vegetables with low prices in 1998
and 1999, including apples, black-eyed
peas, cherries, citrus, caneberries, onions,
melons, peaches, and potatoes. P.L. 106387, Section 811 and Section 816
mandated respectively $100 million in
No Provision
Mandated specialty crop purchases using CCC
funds: $100 million in each of FY2002 and
FY2003, $120 million in FY2004, $140
million in FY2005, and $170 million in
FY2006. Mandated purchases of unspecified
commodities, at $30 million each year.
[Section 163]
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payments to apple growers and $20
million to cranberry growers to
compensate for low prices. P.L. 107-25,
Section 7(b), mandated the CCC to
distribute $133.4 million to states for
support of specialty crops.
C. PAYMENT LIMITS (Fixed, marketing loan, countercyclical)
1. Fixed Payments, and CounterCyclical Payments
a. Fixed contract payments are subject to
a $40,000 per person, per year limit for
grains, cotton, and rice.[Section 115]
(Note: Peanuts and oilseeds not eligible
for contract payments, so no payment
limit for these commodity growers)
a. Combined fixed, decoupled payments for
grains, cotton, and oilseeds are limited to
$50,000 per year per person. [Section 109]
Separate payment limit for peanuts set at
$50,000. [Section 169]
a. Fixed, decoupled commodity payments
combined with counter-cyclical target price
deficiency payments for grains, cotton, rice
oilseeds, and peanuts are subject to a $75,000
per person, per year limit. [Section 169]
b. No countercyclical payments in current
law.
b. Counter-cyclical payments for grains,
cotton, rice and oilseeds are subject to a
$75,000 per person, per year limit. [Section
109] Separately, counter-cyclical payments
for peanuts are limited to $75,000 per
person per year. [Section 169]
b. See above - for both fixed and
countercyclical payments there is a combined
limit of $75,000 per person per year for
payments made to producers of all eligible
crops. No separate limit for peanuts. [Section
169]
Marketing loan benefits for grains, cotton,
and oilseeds combined are subject to a
$150,000 per person, per year limit.
[Section 183] Separately, marketing loan
benefits for peanuts are limited to $150,000.
[Section 169] Separately, marketing loan
benefits for wool and mohair are limited to
Sets a payment limit of $150,000 per person
per year for marketing loan benefits paid for
all commodities (grains, cotton, rice oilseeds,
peanuts, dry peas, lentils, and chickpeas,
wool, and honey). Included in this limit are
marketing loan gains, LDPs, loan forfeiture
gains, and commodity certificate gains.
2. Marketing Loan Benefits
Marketing loan benefits (marketing loan
gains and LDPs) for all crops combined
are subject to a $75,000 per person, per
year limit. [Section 115] The limit was
raised to $150,000 for crop years 1999,
2000, and 2001 by respectively P.L. 10678, sec. 813; P.L. 106-387, sec. 837; and
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P.L. 107-25, sec. 10). Exempt from
payment limits are marketing certificates
sold to farmers at the posted county price
and used to pay off marketing assistance
loans (authorized by P.L. 106-78, sec.
812).
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$150,000. [Section 130(f)] Separately,
marketing loan benefits for honey are limited
to $150,000. [Section 131(f)]
SENATE BILL
[Section 169]
3. Spouse Benefit and 3 Entity Rule
No change is made to existing policy that Same as current law.
allows a spouse to be considered a
separate person or allows one person to
receive payments from 2 additional farms.
Either allowance doubles the limit on
payments.
A spouse allowance of an additional $50,000
is created. The 3-entity rule is replaced by
applying the limits to payments from all
sources (the so-called direct attribution rule.)
[Section NA]
4. Adjusted Gross Income Limit
No provision.
No provision
A person with adjusted gross income in excess
of $2.5 million is ineligible for payments.
[Section NA]
Same as current law.
Creates a 1-year Commission on the
Application of Payment Limitations for
Agriculture to analyze and make
recommendations on payment limits. [Section
NA]
5. Payment Limitation Commission
No provision.
D. COUNTER-CYCLICAL FARM SAVINGS ACCOUNTS
No provision.
Same as current law.
Farm counter-cyclical savings accounts are
authorized as a pilot program in 3 states.
Farms with adjusted gross revenue from
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commodities of at least $50,000 would be able
to contribute an unlimited amount into a
savings account with limited matching federal
contributions (up to $5,000 per fiscal year).
Withdrawals are permitted when adjusted
gross revenue is less than 90% of the previous
5-year average.[Section 114]
(Note: Lugar Amendment 2859)
E. WTO LIMITS ON ALLOWABLE DOMESTIC SUPPORT
There is no upper limit in the law for
spending on commodity support
programs.
If USDA determines that total spending for
commodity support will exceed the limits
accepted by the United States in the
Uruguay Round Agreements, adjustments
may be made to reduce spending to the
limits but not below the allowable limits.
[Section 181(e)]
If USDA notifies Congress that support
program spending will exceed the allowed
limits and that adjustments will be made, all
spending on the designated programs will be
suspended after 18 months unless Congress
disallows the adjustments. [Section 164]
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II. CONSERVATION
CONSERVATION
CURRENT LAW/POLICY
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SENATE BILL
A. Environmental Conservation Acreage Program (ECARP)
Title VII of Food Security Act (FSA) of
1985 as amended by Title III of the
Federal Agriculture Improvement and
Reform (FAIR) Act of 1996.
Title II, Farm Security Act of 2001.
Title II of the Agriculture, Conservation,
and Rural Enhancement Act of 2001.
1. Purpose and Programs. Authorizes
program through long term contacts and
acquisition of easements, to be
implemented through the Conservation
Reserve Program (CRP), Wetlands
Reserve Program (WRP), and
Environmental Quality Incentive Program
(EQIP). [Section 1230(a) of the 1985
FSA as amended by Section 331 of the
1996 FAIR]
No provisions.
Renames ECARP the Comprehensive
Conservation Enhancement Program
(CCEP)and places new name throughout
Section 1230. [Section 207(a)]
Amends Section 1230(a) to reflect changed
placement of conservation programs in 1985
FSA. [Section 211(a)]
Repeals Section 1230A. [Section 207(c)]
[Note: Section 1230A is replaced with new
good faith provisions, discussed below in H
(13) (a).]
Good Faith protection provisions added
as Section 755 of the FY2001
Agriculture Appropriations. [Section
1230A of 1985 FSA, as amended by
Section 331 of 1996 FAIR]
[Note: ECARP is an umbrella under
which the CRP,WRP, and EQIP are
placed.]
2. Priority Areas. Permits the Section
to designate watershed, multistate areas,
or areas of special environmental
sensitivity for enhanced conservation
Repeals section 1230(c). [Section 201(2)]
Adds a new subsection giving priority to
areas where projects could be completed
most rapidly. [Section 211(b)]
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assistance through the CRP, WRP, and
EQIP. [Section 1230(c) of the 1985 FSA
as amended by Section 331 of the 1996
FAIR]
B. Conservation Reserve Program (CRP)
1. Period of Authorization and
Purposes. Authorizes program through
FY2002, and states the purposes are to
conserve and improve soil and water
resources. [Section1231 (a) of the 1985
FSA as amended by Section322(a)(1) of
the 1996 FAIR]
Reauthorizes CRP through FY2011. [Section
211(a)]
Adds wildlife resources to the purposes of the
program. [Section 211(b)]
Reauthorizes CRP through FY2006
[Section 212(a)]
2. Eligibility. Makes certain highly
erodible land, marginal pastureland, and
other cropland eligible. [Section 1231(b)
of the 1985 FSA]
Repeals the limit on enrolling marginal
pastureland to less than 10% of the total
enrolled acres, expands the definition of other
eligible cropland to include threats to soil and
air quality, and makes eligible land in
production for at least 4 years that would
contribute to conservation of ground and
surface water. [Section 212(a)] Adds a new
Section1231(i) that requires balance between
soil erosion, water quality, and wildlife habitat
when reviewing bids, with implementing
regulations to be issued within 180 days of
enactment. [Section 212(d)]
Makes eligible land that has a cropping
history for 3 of the 6 years preceding
enactment (and land enrolled in the CRP on
that date), and adds a new subsection that
makes land enrolled under the continuous
signup and the buffer initiative eligible for
the regular program. [Section 212(b)]
3. Enrollment Ceiling Authorizes
enrollment ceiling at 36.4 million acres.
[Section 1231(d) of the 1985 FSA as
amended by Section 332(b) of the 1996
FAIR.]
Raises ceiling to 39.2 million acres. [Section
212(b)]
Raises ceiling to 41.1 million acres. [Section
212(c)]
[Note: Section 215(a), in the water
conservation provisions, lowers the CRP
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enrollment ceiling to 40.0 million acres, and
Section 215(b) than allows an additional
500,000 acres to be enrolled in the state
Conservation Reserve Enhancement
Program, bringing total enrollment to 40.5
million acres.]
4. Duration of Contract. Allows CRP
contracts for some land devoted to
hardwood trees, shelter belts, wind
breaks, or wildlife corridors to be longer
than the 10 to 15 years allowed for other
contracts. [Section 1231(e)(2) of the
1985 FSA]
No provisions.
Amends Section 1231(e)(2) to allow the
Secretary to extend contracts on hardwood
forests for up to 15 years and limits annual
payments to 50% of the original contract
amount, and allow new contracts of 10 to
30 years. [Section 212(d)]
5. Conservation Priority Areas.
Requires the Section to establish, at the
request of a state, priority watersheds in
specified and other areas where
enrollment would “maximize water
quality and habitat benefits.” [Section
1231(f) of the 1985 FSA]
Allows land enrolled under this subchapter to
be eligible to reenroll in the CRP. [Section
212(c)]
Gives priority to areas where designation
would lead to the most rapid completion of
projects. [Section 212(b)]
6. Enrollment Subcategories.
Authorizes a 500,000 acre pilot
program, with enrollment limited to
150,000 acres in any state for small
wetlands(less than 5 acres) and buffers in
6 specified upper Midwestern states. [A
new Section1231(h), enacted in Title XI
of the FY2001 Agriculture
Appropriations (P.L. 106-387]
Expands the pilot program to all states and
limits enrollment in any state to 150,000
acres. [Section 215]
Deletes “pilot”, reauthorizes the program
through FY2006, and increases the
maximum size of eligible sites from 5 acres
to 10 acres (but only up to 5 acres are
eligible for payments). [Section 212(e)]
7. Duties of Owners and Operators.
Sets limits on commercial uses of lands in
Allows certain economic uses of enrolled
lands if consistent with soil, water, and
Adds a new subsection that allows irrigated
land to be enrolled through the buffer
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the CRP, but allows the Section to permit
harvesting or grazing under very limited
circumstances. [Section 1232(a)(7)]
Sets a goal of planting 1/8 of the land
enrolled each year to trees or habitat.
[Section 1232(c)]
Allows alley-cropping. [Section 1232(d)]
[Section1232(a) (7) of the 1985 FAIR as
amended by the 1990 FACTA, Section
1232(c) of the 1985 FSA, and Section
1232(d) of the 1985 FSA, respectively]
wildlife conservation. These uses include
managed grazing and haying (with reduced
payments), siting of wind turbines, and
harvesting biomass to produce energy (with
reduced payments). Deletes subsections (c)
and (d). [Section 213]
initiative or the CREP at the irrigated land
rate. [Section 212(f)]
Allows participants to plant native prairie
grasses on enrolled marginal pastureland, to
permit harvesting or grazing for
maintenance purposes on lands enrolled
through the buffer initiative or the CREP,
and adds a new subsection that makes crop
production on other highly erodible land a
violation of a CRP contract unless it has a
cropping history or was a building site when
it was purchased. [Section 212(g)]
Adds a new subsection that permits wind
turbines on CRP land (except land enrolled
in the continuous enrollment), with
payments reduced based on the diminished
value for CRP. [Section 212(h)]
8. Payments. Lays out the terms and
conditions for CRP payments.
[Section1234 of the 1985 FSA as
amended by Section1434(a) of the 1990
FACTA)
Payments for easements limited to
$50,000 per year. [Section 1239C(f)]
No provisions.
Adds a new subsection to provide
enrollment and cost sharing payments to
producers who enroll land in the buffer
initiative or through a CREP. [Section
212(i)]
Exempts payments for land enrolled in the
buffer initiative or through a CREP from the
payment limit for easements. [Section
212(j)]
9. County Enrollment Limits. Limits
enrollment in the CRP and WRP to 25%
of county cropland, and limits easements
to 10%; limits may be exceeded if it
would not adversely affect the local
economy or if operators are having
Repeals the provision allowing the Secretary
to exceed the county enrollment limit if
operators are having difficulty meeting
compliance requirements. [Section 244(a)]
Exempts land enrolled under the continuous
signup from county enrollment limit.
[Section 212(k)]
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difficulty meeting compliance
requirements. [Section1243(b) of the
1985 FSA as amended by Section 341 of
the 1996 FAIR.]
10. Funding and Administration.
Provides mandatory funding through the
CCC. [Section1241(a) of the 1985 FSA
as amended by Section341 of the 1996
FACT]
Reauthorizes mandatory funding through
FY2011. [Section241]
Reauthorizes funding from the CCC through
FY2006, and includes funding for technical
assistance in support this program. [Section
211(c)]
11. Study of Economic Effects. No
provisions.
No provisions.
Requires the Secretary to report to the
House and Senate Agriculture Committees
on the economic and social effects of the
CRP on rural communities within 270 days
of enactment. Specifies 3 components of
the analysis. [Section 212(l)]
1. Enrollment. The 1990 FACTA adds
a new Section1237 to the 1985 FSA
establishing the WRP and capping
enrollment at 975,000 acres. [Section
1438] Enrollment allowed through
calendar year 2002. [Section 333(b)(1) of
the 1996FAIR]
Enrollment ceiling increased from
975,000 acres to 1,075,000 acres.)
[Section 808 of the FY2001 Agriculture
Appropriations (P.L. 106-387)]
Allows enrollment of up to 150,000 acres per
calendar year starting in 2002, with any acres
up to the annual limit that is not enrolled can
be enrolled in succeeding years, through
FY2011. [Section 221(a)]
Authorizes enrollment through FY2011.
[Section 221(c)}
Authorizes WRP enrollment through
calendar year 2006. [Section 214(c)] Sets a
maximum enrollment ceiling of 2,225,000
acres, and an annual enrollment ceiling of
250,000 acres, of which up to 25,000 acres
can be enrolled in the new Wetland Reserve
Enhancement Program. [Section 214(b)]
2. Enrollment Options. Requires 1/3
enrollment each using permanent
easements, 30 year easements, and long-
Deletes the 1/3 requirement, and the
distinction between permanent and temporary
easements. [Section 221(b]
Creates a new Wetland Reserve
Enhancement Program that allows
agreements with state and local government,
C. Wetlands Reserve Program (WRP)
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term agreements. [Section1237(b) of the
1985 FSA as amended by Section333(a)
of the 1996 FAIR]
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and non-governmental organizations to
restore wetlands on land in or eligible to be
enrolled in the WRP. [Section 214(d)]
3. Easements and Agreements.
Describes the general terms of easements
and agreements. Prohibits altering
habitat, spraying chemicals and mowing,
any activity that degrades the land, and
any other activity that counters the
purpose of the easement, unless
permitted in the plan. [Section 1237A of
the 1985 FSA as amended by
Section333(d)(1) of the 1996 FAIR]
Replaces the 4 specific prohibitions with a
general statement to allow only changes
permitted in the plan. Deletes subsection (e),
which distinguishes 3 lengths of easements,
and subsection (h), which can require
wetlands to be restored if there is no
easement. [Section 222]
No provisions.
4. Secretarial Duties, including
Technical Assistance. Describes how
cost sharing and technical assistance will
be provided; and how priorities will be
set for determining which bids to accept.
[Section1237C of the 1985 FSA]
Deletes subsection (d), which requires the
Secretary to give priority to using permanent
easements. [Section 223]
Amends Section 1237C(a) to provide funds
from the CCC for technical assistance in
support of the WRP. [Section 214(a)]
Amends Section1237C(a)(2) to add
monitoring and maintenance to the types of
technical assistance provided to participants.
[Section 214(e)]
5. Changes in Ownership. Limits
program entry if ownership changes
occurred during the previous year, and
specifies terms under which easements
can be modified or terminated.
[Section1237E of the 1985 FSA]
Replaces 1990 acquisition date in
Section1237E(a)(2) with provision to make
eligible at any time land acquired through
foreclosure where the previous owner
exercised a right of redemption. [Section 224]
No provisions.
6. Funding. Funding from the CCC is
authorized to implement the WRP.
[Section 1241(a) of the 1985 FSA]
Reauthorizes mandatory funding through
FY2011. [Section 241]
Reauthorizes funding from the CCC through
FY2006, and includes funding for technical
assistance in support of this program.
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[Section 211(c)]
D. Environmental Quality Incentives Program (EQIP)
1. Program Purposes. Identifies 4
programs that EQIP replaces. Specifies
that EQIP maximize environmental
benefits per dollar spent while meeting 4
purposes. [Section 334 of the 1996 FAIR
adds Section1240 to the 1985 FSA]
Deletes reference to the programs that were
replaced; replaces the purpose of responding
to environmental threats with the purpose of
providing environmental benefits; and expands
the benefits to include air quality. [Section
231]
Specifies that EQIP is to promote
production and environmental quality while
maximizing environmental benefits per
dollar spent by assisting producers to meet 6
specified purposes. [Section 213(a)]
2. Definitions. Defines “eligible land”,
“land management practice”, “livestock”,
“producer”, and “structural practice”.
[Section 1240A of the 1985 FSA]
Adds non-industrial private forest land to
“eligible land”, and replaces the notion of
posing an environmental threat with the
notion of providing environmental benefits in
that definition; and “producer” is expanded to
include non-industrial private forestry.
[Section 232]
Adds definitions of “beginning farmer or
rancher”, “comprehensive nutrient
management”, “innovative technology”,
“managed grazing”, “maximum
environmental benefits per dollar
expended”, “practice”, and “program”.
[Section 213(a)]
3. Program Administration.
Authorizes EQIP through 2002; eligible
practices include structural and land
management practices; authorizes
contracts of 5 to 10 years; provides costshare of not more than 75% for structural
practices; prohibits cost sharing to large
livestock operations to construct animal
waste management facilities; provides
incentive payments for land management
practices; provides funding (not to
exceed projected costs) for technical
assistance; and lists types of private
sources to provide technical assistance.
[Section 1240B of the 1985 FSA]
Reauthorizes EQIP through FY2011;
authorizes contracts of 1 to 10 years; repeals
requirement that structural practices be
selected to maximize environmental benefits
per dollar spent; deletes limitation on
payments to large livestock operations to
construct animal waste management facilities;
and adds a new provision to make incentive
payments at an amount and rate to encourage
multiple land management practices, with
emphasis on payments for practices that
address “residue, nutrient, pest, invasive
species, and air quality management.”
[Section 233]
Reauthorizes EQIP through FY2006; adds
comprehensive nutrient management
planning to the list of eligible practices;
allows the Secretary to provide conservation
education to producers; authorizes contracts
of 3 to 10 years; limits producers to 1
contract for structural practices to manage
livestock nutrients through FY2006; limits
large livestock operators to 1 contract for a
waste storage or treatment facility;
authorizes application and evaluation
procedures for selecting applicants;
prohibits bidding down; limits cost sharing
payments to 75% (up to 90% for limited
resource and beginning farmers, or to
address a natural disaster); prohibits
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duplicate cost sharing payments for the
same practice; eliminates (by not including)
the limitation on cost-sharing with large
confined livestock operations for waste
management facilities; permits incentive
payments for technical assistance to certified
individuals to develop comprehensive
nutrient management plans; and specifies
circumstances for terminating contracts.
[Section 213(a)]
4. Evaluation of Offers. Requires the
Secretary to give higher priority to
assistance in priority areas, or to
watersheds, regions, or conservation
priority areas where states or localities
are active partners, and maximize
environmental benefits per dollar spent.
[Section1240C of the 1985 FSA]
Replaces these provisions with general
language about aiding farmers to comply with
environmental laws and encourage
conservation, maximizing the benefits of using
manure and other soil amendments, and
encouraging sustainable grazing systems.
[Section 234]
Adds higher priority also to be given for
special projects initiated by a new
partnership program to address
environmental issues placed in Section
1243(f), and to innovative technologies for
structural or land management practices.
[Section 213(a)]
5. Duties of Producers. Lists 5 duties;
one is a prohibition against practices that
counter the purposes of EQIP.
[Section1240D of the 1985 FSA]
No provisions.
Almost identical to current law, except gives
the Section greater latitude in determining
the appropriate penalty for violations.
[Section 213(a)]
6. Program Plan. Lists the general
contents of plans producers are required
to submit to the Section to participate.
[Section1240E of the 1985 FSA]
Replaces mention of management and
structural practices with providing greater
environmental benefits. [Section 235]
Almost identical to current law. [Section
213(a)]
7. Secretarial Duties. Assigns 5 duties
to the Sec; one is to provide technical
assistance and cost-share or incentive
payments for structural and land
management practices; another is to
Deletes incentive payments from
implementing structural and land management
practices. [Section 236]
Almost identical to current law, except that
it deletes (by not including) the duty of
providing an eligibility assessment. [Section
213(a)]
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8. Payment Limits and Timing. Limits
payments to $10,000 annually and
$50,000 per contract; specifies the annual
limit can be exceeded to maximize the
environmental benefits per dollar spent;
and delays federal expenditures until the
year after the contract has been signed.
[Section 1240G of the 1985 FSA]
Limits payments to $50,000 annually and
$200,000 per contract; deletes language
allowing annual limits to be exceeded to
provide maximum environmental benefit per
dollar spent, and repeals provisions to delay
federal expenditures until the year after the
contract has been signed. [Section 237]
Limits total payments under all contracts to
$30,000 annually. It is also limited to
$90,000 for a 3 year contract, $120,000 for
a 4 year contract, and $150,000 for a
contract that is 4 years or longer. The
Secretary can exceed the $30,000 payment
limit under certain circumstances. [Section
213(a)]
9. Other Provisions. Lays out
temporary transition provisions as EQIP
replaces 4 repealed programs. [Section
1240H of the 1985 FSA]
Replaces current language in Section 1240H,
with provisions that provide $30 million, in
FY2002, $45 million in FY2003, and $60
million annually in FY2004-11 from the CCC
for cost share payments and low interest loans
to encourage ground and surface water
conservation. [Section 238]
Replaces current language in Section1240H
with provisions that provide $100 million
annually from EQIP funds, starting in
FY2003, for competitive innovative
matching grants and specifies examples to
include market systems for pollution
reduction, promoting carbon sequestration
in soil and other Best Management
Practices, and protecting drinking water
quality; permits funds from other sources;
limits funding to 50% of cost; funds
unobligated by April 1 each year can be
spent on other EQIP purposes. Adds new
program as Section 1240I for groundwater
conservation in the southern high plains to
improve irrigation efficiency and reduce
water use using EQIP funds. ($15 million in
FY2003, $25 million in FY2004-5, $35
million in FY2006, and $0 in FY2007) Adds
new pilot programs as Section 1240J for
drinking water supplies, and for nutrient
reduction in the Chesapeake Bay watershed
prepare an eligibility assessment. [Section
1240F of the 1985 FSA]
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using EQIP funds. ($10 million in FY2003,
$15 million in FY2004, $20 million in
FY2005, $25 million in FY2006, and $0 in
FY2007) [Section 213(a)]
10. Funding and Administration.
Provides $200 million annually through
FY2002 from the CCC for EQIP, with
50% of the total going to practices
related to livestock production. [Section
1241 of the 1985 FSA as amended by
several annual agricultural
appropriations laws]
Authorizes mandatory spending through the
CCC through FY2011. [Section 241]
Provides $.2 billion for FY2001, $1.025
billion for FY2002-3, $1.2 billion for FY20046, $1.4 billion for FY2007-9, and $1.5 billion
for FY2010-11. [Section 242]
Reauthorizes the livestock provision through
FY2011. [Section 243]
Provides $.5 billion in FY2002, $1.3 billion
in FY2003, $1.45 billion in FY2004-5, $1.5
billion in FY2006, and $.85 billion in
FY2007; provides funding for technical
assistance from the CCC. [Section 241(b)]
Reauthorizes funding from the CCC through
FY2006, and includes funding for technical
assistance in support of this program.
[Section 211(c)]
E. Wildlife Habitat Incentives Program (WHIP)
1. Period of Authorization. Provides a
total of $50 million from the CCC (from
CRP funding) by the end of FY2002.
[Section387(c) of the 1996 FAIR]
Reauthorizes funding from the CCC at $25
million in FY2002, $30 million in FY2003-4,
$35 million in FY2005-6, $40 million in
FY2007, $45 million in FY2008-9, and $50
million in FY2010-11. [Section 252]
Moves WHIP to Section1240M of the 1985
FSA, reauthorizes funding from the CCC at:
$50 million in FY2002; $225 million in
FY2003; $275 million in FY2004; $325
million in FY2005; $355 million in FY2006;
and $50 million in FY2007; all funding to
remain available until spent. Provides
funding for technical assistance from the
CCC. [Section 217(g)]
2. Establishing WHIP No provisions.
No provisions.
Requires consultation with STCs to
establish WHIP. [Section 217(b)]
3. Cost-sharing Payments. Authorizes
cost sharing payments for several
approved purposes. [Section 387(b)]
No provisions.
Requires the Secretary to use at least 15%
of the cost-sharing funds on endangered and
threatened species. [Section 217(c)]
4. Participation Related to Public
No provisions.
Makes individuals and organizations leasing
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Lands. No provisions.
5. Pilot Program. No provisions.
SENATE BILL
public lands eligible for grants. [Section
217(e)]
Allows funds to be used on public lands if
they will benefit private lands. [Section
217(f)]
No provisions.
Allows the Secretary to use up to 15% of
the funds to enroll land for at least 15 years
to protect “essential plant and animal
habitat.” [Section 217(d)]
1. Funding Level. Provides up to a
total of $35 million from the CCC by
FY2002. [Section388(c) of the 1996
FAIR]
Provides up to $50 million annually through
FY2011 from the CCC. [Section 253(b)]
Moves the FPP to Section 1238H-J of the
1985 FSA[Section 218(a)], and repeals
Section 388 of the 1996 FAIR. [Section
218(c)]
Provides from the CCC: $150 million in
FY2002; $250 million in FY2003; $400
million in FY2004; $450 million in FY2005;
$500 million in FY2006; and $100 million in
FY2007; provides funding for technical
assistance from the CCC; limits the federal
share to 50%, limits the portion of the non
federal share provided by the landowner or
in inkind goods and services to 25%, and
prohibits bidding down. [Section 218(b)]
2. Eligible Land. Makes between
170,000 acres and 340,000 acres eligible
if the soil is prime, unique or productive,
and an offer is pending from a state or
local government to limit non agricultural
uses. [Section 388(a) of the 1996 FAIR]
Deletes the maximum and minimum acreage
limits, and makes historic and archaeological
sites eligible. [Section 253(a)]
Same as Section 253(a); and also defines
eligible land to include cropland, rangeland,
grassland, pasture land and forest land that
is part of an agricultural operation. [Section
218]
F. Farmland Protection Program (FPP)
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3. Conservation Planning. Requires a
conservation plan if the land is highly
erodible; the Section can require
conversion of land to a less intensive use
in the plan. [Section388(b) of the 1996
FAIR]
No provisions.
Identical to current law. [Section 218]
4. Eligible Participants. Makes eligible
any state or local agency that has made
an offer to purchase a conservation
easement. [Section 388(a) of the 1996
FAIR]
Expands eligibility to also include federally
recognized Indian tribes, and non profit
organizations that meet specified
qualifications. [Section 253(c)]
Identical to Section 253(c). [Section 218(a)]
5. New Program Options. No
provisions.
No provisions.
Allows up to $10 million to be spent
annually to provide matching grants for
market development, and technical
assistance to participants. [Section 218(a)]
G. Other Programs (Including Technical Assistance)
1. Resource Conservation and
Development Program (RC&D).
Provides assistance to encourage and
improve the capacity of state and local
governments and non profits in rural
areas to develop and implement
conservation programs. Authorized
through FY2002. [Title III of the
Bankhead-Jones Farm Tenant Act as
amended by §1528-1538 of the 1981
AFA]
Permanently reauthorizes program, and makes
numerous other, mostly minor or technical
amendments. [Section 254]
[Note: Many of the changes in the two bills
are different from each other, but they do not
change the basic intent or operation of the
program.]
Permanently reauthorizes program, and
makes numerous other, mostly minor or
technical amendments. [Section 216]
[Note: Many of the changes in the two bills
are different from each other, but they do
not change the basic intent or operation of
the program.]
2. Small Watershed Rehabilitation
Program. Provides financial and
technical assistance to rehabilitate water
Authorizes $15 million annually in “FY2002
and each succeeding year” to fund the Small
Watershed Rehabilitation Program. [Section
No provisions.
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structures that are nearing or past the end
of their design life. Authorizes
appropriations of $5 million in FY2001,
$10 million in FY2002, $15 million in
FY2003, $25 million in FY2004, and $35
million in FY2005. [Authorized in
Section 313 of the Grain Standards and
Warehouse Improvement Act of 2000]
257]
3. Conservation of Private Grazing
Lands. Provide coordinated technical,
educational, related assistance to
preserve and enhance privately-owned
grazing lands; authorizes 2 demonstration
districts, and authorizes $20 million in
FY1996, $40 million in FY1997, and $60
million in FY1998 and each subsequent
year. [Section 386 of the 1996 FAIR]
Adds encouraging the use of sustainable
grazing systems to the list of activities for
which assistance can be provided. [Section
251]
Moves the program to a new Section 1240P
of the 1985 FSA and, makes numerous
other, mostly minor, changes, and
authorizes $60 million annually through
FY2006. [Section 217(a)]
Repeals provisions establishing program in
Section 386 of the 1996 FAIR. [Section
217(b)]
4. Technical Assistance. Allows
persons who need and apply a
conservation compliance plan to obtain
technical assistance from approved
sources other than NRCS; the Section
must document a rejection of assistance
from those sources [Section 1243(d) of
the 1985 FSA]
Allows producers to seek assistance from
third parties, who have the specified expertise,
and requires the Secretary to develop a system
for approving qualified third parties who
provide technical assistance to EQIP
participants within 6 months of enactment.
[Section 244(b)]
Adds a new Section 1244(f) to the 1985
FSA f) requiring the Secretary to create a
certification program for third parties to
provide technical assistance, specifies
standards for certification, permits the
Section to repay landowners who use third
parties, and establishes an advisory
committee for the certification program.
[Section 204]
5. State Technical Committees (STC)
Creates STCs , lists the composition,
outlines responsibilities to include
providing “information, analysis, and
recommendations” on implementing
conservation provisions (including
No provisions.
Expands membership in STCs to include
expertise in forestry, restates its
responsibilities to mesh with other changes
this legislation makes to conservation
programs, and makes subcommittees and
local working groups working on STC
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several specified topics) to the state
conservationist, and exempts the STC
from FACA meeting requirements.
[Section 1261 of the 1985 FSA]
7. Repeals of Authorized Programs
and Activities. No provisions.
SENATE BILL
business exempt from FACA. [Section 221]
Repeals provisions: creating the Wetlands
Mitigation Banking Program [Section 1222(k)
of the 1985 FSA]; exempting CRP payments
from any limits under the 1985 FSA, the 1990
FACTA, and the 1949 AA [Section
1234(f)(3)]; protecting the base history of
land enrolled in the CRP [Section 1236 of the
1985 FSA]; exempting WRP payments from
any limits under the 1985 FSA, the 1990
FACTA, and the 1949 AA [Section
1237D(c)(3)] and ; creating the
Environmental Easement Program
[Section1239 of the 1985 FSA], the
Conservation Farm Option [Section 1240M of
the 1985 FSA], and the Tree Planting
Initiative [Section1256 of the 1985 FSA]
[Section 261] Repeals the National Natural
Resources Conservation Foundation [Section
351-360 of the 1996 FAIR] [Section 262]
Repeals numerous conservation programs in
current law and reauthorizes them in other
sections of farm law, as noted in the entries
above.
a .Places GRP in Section 1238 of the 1985
FSA creating a 2 million acre grasslands
reserve, split evenly between restored
grasslands and virgin (never cultivated)
grasslands. Section 1238(b)(1) sets minimum
size for enrolled parcels at 50 contiguous
acres east of the 90th meridian and 100
contiguous acres west of the 90th meridian.
a. Places GRP in Section 1238N-P of the
1985 FSA, creating a 2 million acre
grasslands reserve, of which up to 500,000
acres will be native grasslands in tracts of 40
acres or less. Section 1238N sets minimum
size at 40 contiguous acres east of the 98th
meridian and 100 contiguous acres west of
the 98th meridian [Section 219(a)]
H. New Programs
1. Grasslands Reserve Program
(GRP).
a. Reserve Size. No provisions.
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[Section 255(a)]
b. Eligible Lands. No provisions.
b. Defines eligible land to include natural grass
and shrub land that has a potential to serve as
important plant or animal habitat, or has been
historically dominated by natural grass or
shrubland. [Section 255(a)]
b. Same definition of eligible land as in H.R.
2646, except that it also enrolls incidental
additional land that is necessary for the
administrative efficiency of an
easement.[Section 219(a)]
c. Enrollment Options. No provisions.
c. Spends at least 2/3 of funds on contracts of
10 to 20 years, and the remainder on 30 year
or permanent easements. [Section 255(a)]
c. Allows permanent easements, 30 year
easements, the longest easements allowed
by state law, and 30 year rental agreements.
Allows the Secretary to delegate easements
to private conservation organizations, land
trusts, and state agencies. [Section 219(a)]
d. Permitted and Prohibited Uses of
Enrolled Lands. No provisions.
d. Permits contract holders to use common
grazing practices, and permits haying and
mowing outside the bird nesting season, but
prohibits all agricultural production (except
hay) and almost all practices that require
disturbing the land surface in section
1238(A)(b). [Section 255(a)]
d. Similar to H.R. 2646 for permitted and
prohibited uses of enrolled lands. [Section
219(a)]
e. Ranking Criteria for Bids. No
provisions.
e. Requires the Secretary to develop ranking
criteria for reviewing applications, with
emphasis on support for native vegetation,
grazing operations, and plant and animal
diversity, and to set the terms for restoration.
[Section 255(a)]
e. Requires the Secretary to work with
STCs in developing ranking criteria, and to
give priority to grazing operations,
maintaining or restoring biodiversity, and
land under the greatest threat of conversion.
[Section 219(a)]
f. Payment Levels. No provisions.
f. Describes how payment levels are to be set
for each form of participation, sets cost
sharing payments for restoration at 90% for
f. Describes how payment levels are to be
set for each form of participation, provides
that rental agreements be reviewed and
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virgin grasslands and 75% for restored
grasslands, and provides technical assistance.
[Section 255(a)]
adjusted at least once every 5 years, limits
cost-sharing payments to 75% for
restoration, and provides technical
assistance. [Section 219(a)]
g. Penalties for Violation. No
provisions.
g. No provisions.
g. Describes the roles of the Secretary and
the landowner in implementing restoration
agreements, and lists the penalties for
violations, and allows periodic site
inspections. [Section 219(a)]
h. Funding. No provisions.
h. Amends Section 1241 of the 1985 FSA to
provide a total of up to $254 million through
the CCC through FY2011to implement this
program. [Section 255(b)]
h. Amends Section 1241 of the 1985 FSA to
provide such CCC sums as necessary to
implement this program. [Section 219(b)]
2. Farmland Stewardship Program.
No provisions.
Adds this program as a new Section 1239 to
the 1985 FSA. It is to be administered by
NRCS “to more precisely tailor and target”
current conservation programs, using program
funding on a watershed basis, where possible.
Participation requires matching funds, and
can involve other agencies. Participants
submit a management plan and are
encouraged to use easements to implement
conservation management. [Section 256]
[Note: No appropriations are authorized for
this program, so all funding would come from
existing programs]
No provisions.
3. Conservation Security Program
(CSP). No provisions.
No provisions.
Conservation Security Program (CSP).
Authorizes a CSP in Section 1238– 1238B
of the 1985 FSA. It defines 22 terms and
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lists 13 program purposes. To participate,
producers must have an approved plan for
eligible lands (land in the CRP and WRP, or
that has not been in production at least 3 of
the preceding 10 years, is ineligible).
Producers can receive an advance payment
when they enroll, base payments, and bonus
payments for certain practices. Practices
required for each of 3 tiers of participation
are specified, and minimum requirements for
each will be determined at the state level and
approved by the Secretary. Land in an
approved plan will be enrolled in a contract
between FY2003 and FY2006; Tier 1
contracts will be 5 years; Tier II and III
contracts will be 5 to 10 years, and
contracts can be renewed. Total annual
payments are limited to $20,000 for Tier I,
$35,000 for Tier II, and $50,000 for Tier
III. Specified practices are ineligible. State
pilot programs are authorized. [Section 201]
Amends Section 1241 of the 1985 FSA by
adding a new subsection (c) to provide
“such funds as are necessary” from the CCC
through FY2006. [Section 202]
Allows implementation to start on the date
of enactment. [Section 206]
4. Partnerships and Cooperation. No
provisions.
No provisions.
Adds a new Section 1242(f) to the 1985
FSA to allow special projects as
recommended by a state conservationist,
which can respond to meeting the
requirements of specified federal laws or
addressing watersheds or other areas with
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significant environmental problems.
Participants agree to a plan to adjust
implementation of conservation programs to
increase environmental benefits. Funding
uses 5% of EQIP funds annually, with any
unused funds to go to other EQIP activities
that year. [Section 203]
5. Watershed Risk Reduction
Program. No provisions.
No provisions.
Authorizes $15 million annually through
FY2006 to implement a new program to
purchase floodplain easements at
Section1240N of the 1985 FSA. [Section
217(a)]
6. Great Lakes Basin Soil Erosion and
Sediment Control Program. No
provisions.
No provisions.
Authorizes $5 million annually through
FY2006 to implement a new soil erosion
and sediment control program for the Great
Lakes basin at Section 1240O of the 1985
FSA. [Section 217(a)]
7. Water Conservation Program. No
provisions.
No provisions.
Reduces CRP enrollment ceiling from 41.1
million acres to 40.0 million acres. [Section
215(a)]
Authorizes two programs. One will allow
up to 500,000 acres to be enrolled in state
CREPs to contribute to the restoration of a
watercourse or lake, and permit purchasing
or leasing water rights. Priority given to
places where more than 20% of the cost
would be paid from non federal sources, and
promotes any of 4 specified benefits for
wildlife, fish and plants. Protection of state
water laws are specified. Eligible states are
Nevada, California, New Mexico,
Washington, Oregon, New Hampshire, and
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Maine; others can apply to participate.
[Section 215(b)]
Authorizes a new Water Conservation
Program in Section 1240R of the 1985 FSA.
NRCS will provide cost sharing assistance
to increase irrigation efficiency, convert
production to less water-intensive crops,
and acquire water rights. Protection of state
and other water laws required. Nebraska
and South Dakota are ineligible, while the
same 7 states as in the program above are
eligible, and others may apply. Authorizes
funding from the CCC at $25 million in
FY2002, $52 million in FY2003, and $100
million in FY2004-FY2006, with $5 million
allocated each year to monitoring activities.
[Section 215(c)]
8. Grassroots Source Water
Protection Program. No provisions.
No provisions.
Authorizes $5 million annually through
FY2006 in Section 1240Q of the 1985 FSA
for a new program to use technical
assistance capabilities of state rural water
associations that operate wellhead or
groundwater protection programs. [Section
217(a)]
9. Organic Agriculture Research
Trust Fund. No provisions.
No provisions.
Provides $50 million from the CCC in
FY2003, to remain available until spent and
to accrue interest, in FY2003 to establish a
new research fund on organic products.
[Section 231]
10. National Organic Research
Endowment Institute. No provisions.
No provisions.
Establishes a National Organic Research
Endowment Institute to develop and
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implement a plan for research on organic
products using the trust fund (established in
Section 231). [Section 232]
11. Cranberry Acreage Reserve. No
provisions.
No provisions.
Authorizes purchase of permanent
easements on wetlands and buffer strips that
are part of a cranberry operation from
willing sellers. Authorizes $10 million
annually for this activity. [Section 261]
12. Klamath Basin. No provisions.
No provisions.
Authorizes the Secretary to create a federal
task force (membership specified) to
develop a coordinated federal effort to
manage water resources in this basin (6
duties specified). In addition to using
existing programs, the task force will
establish a grant program to carry out its
responsibilities. [Section 262(a) and (b)]
The task force will develop an initial report
within 180 days of enactment, a draft 5-year
plan to implement its duties within 60 days
thereafter, and a final plan within 1 year of
enactment. Eight items to be considered in
the plan are specified. [Section 262(c)]
Consultation with specified non-federal
entities is required. [Section 262(d)]
Authorizes a total of $175 million from the
CCC from FY2003 through FY2006, and
specifies where a small portion of the funds
are to be spent. Funds may not be obligated
after September 30, 2006. [Section 262(e)]
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13. Administrative Requirements for
Conservation Programs
a. Relief for Good Faith Actions. No
provisions.
No provisions.
a. Adds a new Section 1244(a) to the 1985
FSA giving the Secretary the option of
granting relief to conservation program
participants who act in good faith under a
contract, and are subsequently determined
to be in violation. Types of relief and
exceptions are specified. [Section 204]
b. Assistance for Limited Resource
Producers. No provisions.
No provisions.
b. Adds a new Section 1244(b) which
provides necessary funds from the CCC to
assist certain limited resource, socially
disadvantaged, and beginning producers,
and Indian tribes to participate in
conservation programs. The Secretary may
contract with other entities to provide these
services. Adds a new Section 1244(c)
allowing the Secretary to provide incentives
to these producers(except sociallydisadvantaged ones) to participate in
conservation programs. [Section 204]
c. Data Collection and Program
Evaluation.
No provisions.
No provisions.
c. Adds a new Section 1244(d) which
requires the Secretary to collect data that
would permit evaluation of conservation
programs [Section 204]
d. Mediation. No provisions.
No provisions.
d. Adds a new Section 1244(e) which
requires the Secretary to provide mediation
services when an adverse decision is made
about a conservation program. [Section
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204] [Note: Section 1244(f), on technical
assistance, is discussed above in G4.]
e. Adds a new Section 1244(g) to protect
the privacy of personal information about
individuals related to conservation
programs. [Section 204]
e. Privacy of Personal Information. No
provisions.
No provisions.
f. Tribal Lands. No provisions.
No provisions.
f. Adds a new Section 1244(h) which
requires the Secretary to cooperate with a
tribal government when carrying out
conservation programs on tribal lands.
[Section 204]
g. Regional Equity of Conservation
Spending. No provisions.
No provisions.
g. Requires that each state receive a total of
$12 million annually from FY2002 through
FY2006, in conservation funds. Of the
total, $5 million is to be used for EQIP, and
$7 million is to be used for other
conservation programs, with any portion not
obligated by April 1of the fiscal year to be
reobligated to other specified programs.
[Section 241]
14. Assessment of Conservation
Programs. No provisions.
No Provisions.
Assessment of Conservation Programs.
Requires the Secretary to develop a plan to
better coordinate and consolidate the
implementation of conservation programs.
[Section 205(a)]
Requires the Secretary to provide the plan
(and recommendations) to both agriculture
committees within 180 days of enactment.
[Section 205(b)]
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Requires the Secretary to provide a plan
(with a cost estimate) for updating the
national conservation program required by
the Soil and Water Resources Conservation
Act of 1977 to both agriculture committees
within 180 days of enactment, and to report
to both committees of the status of plan
implementation by April 30, 2005. [Section
205(c)]
Requires the Secretary to revise
conservation technical standards within 180
days of enactment , and to update them at
least once every 5 years. [Section 205(d)]
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a. Extends current law, except it increases
required funding to not more than $200
million yearly in CCC funds through
FY2011. [Section 301]
a. Extends current law, except that in
addition to any funds specifically
appropriated for the program, required
funding of not more than $100 million
for FY2002; $120 million for FY2003;
$140 million for FY2004; $180 million
for FY2005; and $200 million for
FY2006 (in CCC funds or equivalent
CCC commodities). [Section 322]
b. No provision.
b. No provision.
b. Priority, for funds in excess of $90
million in any year, for eligible
organizations that have not participated
in the past, and for programs in
emerging markets. [Section 322]
c. No provision.
c. No provision.
c. Mandates new U.S. Quality Export
Initiative (using appropriated MAP,
FMDP funds), to promote U.S. products
with a new “U.S. Quality” seal overseas.
[Section 322]
A. Agricultural Export Assistance Programs
1. Market Access Program (MAP)
a. MAP helps exporters (mainly
nonprofit industry trade associations,
who allocate the funds to others
including agricultural cooperatives and
small businesses) finance promotional
activities overseas (usually for more
consumer-oriented, higher value
products). Required funding of not
more than $90 million yearly in CCC
funds through FY2002. [Agricultural
Trade Act of 1978 as amended by
Section 244 of Federal Agriculture
Improvement and Reform (FAIR) Act
of 1996]
2. Foreign Market Development
Cooperator Program (FMDP)
a.
Extends current law, except sets
a. Extends current law, except sets
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a. FMDP helps U.S. exporters (mainly required funding at $37 million in CCC
through commodity based trade funds yearly through FY2011. [Section
associations) to finance promotional 305]
activities overseas. Statutory authority
(at such sums as necessary) through
FY2002; current funding is $28 million
per year. [Agricultural Trade Act of
1978 as amended by Section 252 of
FAIR Act of 1996]
required funding of $37.5 million for
FY2002; $40 million for FY2003; and
$42.5 million for FY2004 and
subsequent years (in CCC funds or
equivalent CCC commodities). [Section
324]
b. New emphasis on exporting value-added
products to emerging markets. Requires
annual report to Congress on program.
[Section 305]
b. Establishes a priority, for funds above
$35 million in any year, for eligible
organizations that have not participated
in the past, and for programs in
emerging markets. [Section 324]
b. FMDP has focused on promoting
mainly bulk and partially processed
commodities, targeted to foreign
importers/processors rather than highvalue market.
3. Export Enhancement Program
(EEP)
Current law extended through
a. EEP authorizes cash payments or a. Current law extended through FY2011, a.
CCC commodities as bonus subsidies to at current level of up to $478 million per FY2006, at current level of up to $478
million per year. [Section 323]
help exporters sell agricultural products year. [Section 304]
(mainly wheat and other grains) at more
competitive prices in targeted foreign
markets. Authority through FY2002,
with CCC funding at up to $478 million
per year. [Agricultural Trade Act of
1978 as amended by Section 245 of
FAIR Act of 1996]
b. EEP may be used to help mitigate or
offset the effects of unfair trade
practices, now defined as any foreign
b. No expanded definition.
b. Expands the definition of unfair trade
practices to include: (1) pricing practices
by an exporting state trading enterprise
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act or policy that “violates, or is
inconsistent with, the provisions of, or
otherwise denies benefits to the United
States under, any trade agreement...” or
“is unjustifiable, unreasonable, or
discriminatory and burdens or restricts
United States commerce.”
[Agricultural Trade Act of 1978,
Section 102]
4. Dairy Export Incentive Program
(DEIP)
DEIP authorizes cash or CCC Extends current law through 2011. [Title
commodities as bonus subsidies to help I-C, Section 143]
exporters sell specified dairy products
at more competitive prices in targeted
foreign markets. Authority through
FY2002, with CCC funding to provide
commodities to the maximum levels
consistent with U.S. obligations as a
member of the World Trade
Organization. [Food Security Act of
1985 as amended by Section 148 of the
FAIR Act of 1996]
5. Export Credit Guarantees (GSM)
a. Authority through FY2002 with a. Extends current law through 2011.
CCC funding, where USDA guarantees [Section 306]
commercial financing of not less than
$5.5 billion annually of U.S. agricultural
exports. Financing can be used for
short-term credit (GSM-102) for up to
3 years; and for long-term credit
SENATE BILL
that “are not consistent with sound
commercial practices conducted in the
ordinary course of trade,” or (2)
changing U.S. “export terms of trade
through a deliberate change in the dollar
exchange rate of a competing exporter.”
[Section 323]
Extends current law through FY2006.
[Title I-C, Section 133]
a. Extends current law through 2006.
Requires a report to Congress within 1
year on the status of multilateral
negotiations regarding agricultural
export credit programs. [Section 321]
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(GSM-103), for 3-10 years. GSM
programs are used in countries where
needed financing may not be available
without the CCC guarantees. (At least
35% of total credit guarantees must be
to promote processed or high-value
agricultural products.) [Agricultural
Trade Act of 1978 as amended by the
Section 243 of the FAIR Act of 1996]
b. Supplier Credits feature permits b. No change in supplier credit term.
CCC to issue credit guarantees for
repayment of credit made available by a
U.S. exporter to a foreign buyer for up
to 180 days. [Agricultural Trade Act
of 1978 as amended by Section 243 of
the FAIR Act]
b. Permits guarantees of supplier credits
for up to 12 months. [Section 321]
6. Emerging Markets Program
Extends current law through
a. Requires CCC through FY2002 to a. Extends current law through FY2011. a.
FY2006. [Section 332]
offer no less than $1 billion per year in [Section 308]
direct credit, or credit guarantees, for
exports to emerging markets (formerly
emerging democracies). [Food,
Agriculture, Conservation and Trade
Act of 1990 as amended by Section 277
of the FAIR Act of 1996]
b. Requires CCC to provide $10 b. Increases this funding to $13 million b. No increase.
million annually through FY2002 to annually. [Section 308]
send U.S. advisors to emerging
markets. F o o d , A g r i c u l t u r e ,
Conservation and Trade Act of 1990 as
amended by Section 277 of FAIR Act of
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1996]
B. Food Aid Programs
1. P.L. 480 (Food for Peace) General
a. Seeks to combat hunger and a. Extends P.L. 480 (i.e., authority to
encourage development overseas. Title enter into new agreements) through
I makes export credit available on FY2011. [Section 307]
concessional terms (e.g. low interest
rates for up to 30 years); Title II
authorizes donations for emergency
food aid and non-emergency
humanitarian assistance. Authority to
enter into new P.L. 480 agreements
(which are funded mainly through
annual appropriations) is through
FY2002. [Section 408 of P.L. 480
(Agricultural Trade Development and
Assistance Act of 1954) anas amended
by Section 217 of the FAIR Act of
1996]
a. Extends P.L. 480 (i.e., authority to
enter into new agreements) through
FY2006. [Section 312]
b. Congress has stated five specific b. Adds “conflict prevention” as a new b. Adds “conflict prevention” as a new
purpose. [Section 301]
purposes of P.L. 480 (e.g. combat purpose. [Section 307]
hunger, expand international trade,
etc.). [Section 2 of P.L. 480]
c. Food Aid Consultative group
consisting of specified federal officials,
representatives of private voluntary
organizations (PVOs), foreign nongovernment organizations, and
agriculture producer groups, is
authorized through FY2002. [Section
205 of P.L. 480]
c. Extends Food Aid Consultative Group c. Extends Food Aid Consultative
through FY2006; clarifies what the group Group through FY2006. [Section 305]
is to review to include policies and
guidelines. [Section 307]
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2. P.L.480 Assistance Levels and
Funding
Increases the minimum level of
a. Minimum Title II assistance is 2.025 a.
million metric tons (MMT) of assistance to 2.25MMT per year through
agricultural commodities per year FY2011. [Section 307]
through FY2002; AID Administrator
has some authority to waive minimum.
[Section 204 of P.L. 480]
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a. Increases the minimum level of
assistance to 2.1 MMT in FY2002,
2.2MMT in FY2003, 2.3 MMT in
FY2004, 2.4 MMT in FY2005, and 2.5
MMT in FY2006. [Section 304]
b. Limits CCC Title II costs to $1 b. Removes limit on CCC Title II costs. b. Doubles limit on CCC Title II costs
to $2 billion per year. [Section 306]
billion yearly; some Presidential waiver [Section 307]
authority. [Section 206 of P.L. 480]
c. Provides that at least $10 million but
not more than $28 million of Title II
funding per year shall be use to support
eligible organizations (PVOs,
cooperatives, organizations like the
World Food Program, etc.) in
conducting Title II activities. [Section
202 of P.L. 480]
3.
P.L. 480 Operation &
Administration
a. Permits PVOs to sell Title II
commodities in the recipient country
(or a nearby country) to finance
commodity transportation, storage,
c. Replaces dollar designations by setting
support for eligible organizations at not
less than 5% and not more then 10% of
Title II funding. [Section 307]
c. Replaces dollar designations by
setting support for eligible organizations
at not less than 5% and not more than
10% of Title II funding. [Section 302]
a. Authorizes the use of U.S. dollars and
other currencies for monetization in P.L.
480 – and also Food for Progress and
Section 416 programs; permits PVOs to
a. Similar to House [Sections 303, 310,
& 325]. Also, a food aid commodity
sale is to be “at a reasonable market
price in the economy where the
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etc., and local development projects submit multi-country proposals; and commodity is to be sold.” [Section 310]
(“monetization”). [Section 203 of P.L. permits food aid monetization in more than
one country in the region. [Sections 302;
480]
303; 307]
b. The AID Administrator has 45 days b. Increases the time for decisions from 45
to decide on Title II proposals to 120 days. [Section 307]
submitted by eligible organizations or
U.S. field missions. [Section 207 of
P.L. 480]
b. Also increases the time to 120 days.
Contains other timelines for finalizing
program agreements and announcing
programs each year. Permits USDA to
approve an agreement that provides for
direct delivery of commodities to foreign
milling or processing facilities that are
more than 50% U.S.-owned, with cash
proceeds transferred to eligible
organizations for carrying out projects.
[Section 307]
Extends authorization through
c. Authorizes $2 million in each of c. Extends authorization through FY2011. c.
FY2006. [Section 311]
FY2001 and FY2002 to “preposition” [Section 307]
food aid commodities in the U.S. and
foreign countries. [Section 407 of P.L.
480]
Extends authorization through
d. Authorizes appropriations of up to d. Extends authorization through FY2011. d.
FY2006. [Section 308]
$3 million annually through FY2002 for [Section 307]
grants to PVOs and U.S. non-profits
for stockpiling shelf-stable, prepackaged foods. [Section 208 of P.L.
480]
e. Requires USDA (if feasible) to e. No provision.
establish a “micronutrient fortification”
pilot program; authority expires in
e. Extends the authorization as an
ongoing program through FY2006.
[Section 313]
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FY2002. [Section 415 of P.L. 480]
f. No provision.
f. No provision.
4. Certified Institutional Partners
No provision in current law. Currently No provision.
PVOs and cooperatives generally must
undergo the same application
procedures to participate in various
food aid programs each time they apply.
5. Farmer-to-Farmer Program
Requires that no less than 0.4% of P.L. Extends funding authority at current 0.4%
480 funds be used to provide U.S. through FY2011. [Section 307]
farmers and other agricultural experts
technical assistance in developing,
middle income and emerging market
countries. [Title V of P.L. 480 as
amended by Sections 224 and 277 of
the FAIR Act of 1996]
f. Permits President to establish, under
Title II, a “pilot emergency relief
program to provide live lamb to
Afghanistan.” [Section 309.]
Requires AID or USDA, as applicable,
to establish a process enabling PVOs
and cooperatives that can demonstrate
their capacity to carry out the programs
(under P.L. 480; Section 416; or Food
for Progress) to qualify as “certified
institutional partners,” which would
entitle them to use streamlined
application procedures, including
expedited review and approval to
receive commodities for use in more
than one country. [Sections 302; 325;
334]
Extends funding authority through 2006,
and increases minimum funding to 0.5%
of P.L. 480 funds. [Section 314]
6.
CCC (Section 416) Surplus
Donations
Maintains current law, and requires USDA Maintains current law, and permits
Permanent law authorizes the use of to publish in the Federal Register, by USDA to approve an agreement that
CCC-owned surplus commodities for October 31, an estimate of Section 416 provides for direct delivery of
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overseas donations. [Section 416(b) of
the Agricultural Act of 1949 as
amended]
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commodities to be
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