Farm Bill (2002)

PUBLIC LAW 107–171—MAY 13, 2002

FARM SECURITY AND RURAL INVESTMENT
ACT OF 2002

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116 STAT. 134

PUBLIC LAW 107–171—MAY 13, 2002

Public Law 107–171
107th Congress
An Act
May 13, 2002
[H.R. 2646]
Farm Security
and Rural
Investment Act
of 2002.
7 USC 7901 note.

To provide for the continuation of agricultural programs through fiscal year 2007,
and for other purposes.

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Farm Security
and Rural Investment Act of 2002’’.
(b) TABLE OF CONTENTS.—The table of contents of this Act
is as follows:
Sec. 1. Short title; table of contents.
TITLE I—COMMODITY PROGRAMS
Sec. 1001. Definitions.
Subtitle A—Direct Payments and Counter-Cyclical Payments
Establishment of base acres and payment acres for a farm.
Establishment of payment yield.
Availability of direct payments.
Availability of counter-cyclical payments.
Producer agreement required as condition of provision of direct
payments and counter-cyclical payments.
Sec. 1106. Planting flexibility.
Sec. 1107. Relation to remaining payment authority under production flexibility
contracts.
Sec. 1108. Period of effectiveness.
Sec.
Sec.
Sec.
Sec.
Sec.

1101.
1102.
1103.
1104.
1105.

Subtitle B—Marketing Assistance Loans and Loan Deficiency Payments
Sec. 1201. Availability of nonrecourse marketing assistance loans for loan commodities.
Sec. 1202. Loan rates for nonrecourse marketing assistance loans.
Sec. 1203. Term of loans.
Sec. 1204. Repayment of loans.
Sec. 1205. Loan deficiency payments.
Sec. 1206. Payments in lieu of loan deficiency payments for grazed acreage.
Sec. 1207. Special marketing loan provisions for upland cotton.
Sec. 1208. Special competitive provisions for extra long staple cotton.
Sec. 1209. Availability of recourse loans for high moisture feed grains and seed
cotton.

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Sec.
Sec.
Sec.
Sec.
Sec.

1301.
1302.
1303.
1304.
1305.

Sec.
Sec.
Sec.
Sec.

1306.
1307.
1308.
1309.

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Subtitle C—Peanuts
Definitions.
Establishment of payment yield and base acres for peanuts for a farm.
Availability of direct payments for peanuts.
Availability of counter-cyclical payments for peanuts.
Producer agreement required as condition on provision of direct
payments and counter-cyclical payments.
Planting flexibility.
Marketing assistance loans and loan deficiency payments for peanuts.
Miscellaneous provisions.
Termination of marketing quota programs for peanuts and compensation
to peanut quota holders for loss of quota asset value.

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PUBLIC LAW 107–171—MAY 13, 2002

116 STAT. 135

Sec. 1310. Repeal of superseded price support authority and effect of repeal.
Subtitle D—Sugar
Sec. 1401. Sugar program.
Sec. 1402. Storage facility loans.
Sec. 1403. Flexible marketing allotments for sugar.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

1501.
1502.
1503.
1504.
1505.
1506.
1507.
1508.

Subtitle E—Dairy
Milk price support program.
National dairy market loss payments.
Dairy export incentive and dairy indemnity programs.
Dairy product mandatory reporting.
Funding of dairy promotion and research program.
Fluid milk promotion.
Study of national dairy policy.
Studies of effects of changes in approach to national dairy policy and
fluid milk identity standards.

Subtitle F—Administration
Administration generally.
Suspension of permanent price support authority.
Payment limitations.
Adjusted gross income limitation.
Commission on application of payment limitations.
Adjustments of loans.
Personal liability of producers for deficiencies.
Extension of existing administrative authority regarding loans.
Commodity Credit Corporation Inventory.
Reserve stock level.
Farm reconstitutions.
Assignment of payments.
Equitable relief from ineligibility for loans, payments, or other benefits.
Tracking of benefits.
Estimates of net farm income.
Availability of incentive payments for certain producers.
Renewed availability of market loss assistance and certain emergency
assistance to persons that failed to receive assistance under earlier authorities.
Sec. 1618. Producer retention of erroneously paid loan deficiency payments and
marketing loan gains.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

1601.
1602.
1603.
1604.
1605.
1606.
1607.
1608.
1609.
1610.
1611.
1612.
1613.
1614.
1615.
1616.
1617.

TITLE II—CONSERVATION
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

2001.
2002.
2003.
2004.
2005.
2006.

Subtitle A—Conservation Security
Conservation security program.
Conservation compliance.
Partnerships and cooperation.
Administrative requirements for conservation programs.
Reform and assessment of conservation programs.
Conforming amendments.

Subtitle B—Conservation Reserve
Sec. 2101. Conservation reserve program.
Sec.
Sec.
Sec.
Sec.

2201.
2202.
2203.
2204.

Subtitle C—Wetlands Reserve Program
Reauthorization.
Enrollment.
Easements and agreements.
Changes in ownership; agreement modification; termination.

Subtitle D—Environmental Quality Incentives
Sec. 2301. Environmental quality incentives program.
Subtitle E—Grassland Reserve
Sec. 2401. Grassland reserve program.
Subtitle F—Other Conservation Programs
Sec. 2501. Agricultural management assistance.
Sec. 2502. Grazing, wildlife habitat incentive, source water protection, and Great
Lakes basin programs.

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116 STAT. 136

PUBLIC LAW 107–171—MAY 13, 2002

Sec.
Sec.
Sec.
Sec.
Sec.

2503.
2504.
2505.
2506.
2507.

Farmland protection program.
Resource conservation and development program.
Small watershed rehabilitation program.
Use of symbols, slogans, and logos.
Desert terminal lakes.

Sec.
Sec.
Sec.
Sec.

2601.
2602.
2603.
2604.

Subtitle G—Conservation Corridor Demonstration Program
Definitions.
Conservation corridor demonstration program.
Implementation of conservation corridor plan.
Funding requirements.

Subtitle H—Funding and Administration
Sec. 2701. Funding and administration.
Sec. 2702. Regulations.
TITLE III—TRADE
Subtitle A—Agricultural Trade Development and Assistance Act of 1954 and
Related Statutes
Sec. 3001. United States policy.
Sec. 3002. Provision of agricultural commodities.
Sec. 3003. Generation and use of currencies by private voluntary organizations and
cooperatives.
Sec. 3004. Levels of assistance.
Sec. 3005. Food Aid Consultative Group.
Sec. 3006. Maximum level of expenditures.
Sec. 3007. Administration.
Sec. 3008. Assistance for stockpiling and rapid transportation, delivery, and distribution of shelf-stable prepackaged foods.
Sec. 3009. Sale procedure.
Sec. 3010. Prepositioning.
Sec. 3011. Transportation and related costs.
Sec. 3012. Expiration date.
Sec. 3013. Micronutrient fortification programs.
Sec. 3014. John Ogonowski Farmer-to-Farmer Program.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

3101.
3102.
3103.
3104.
3105.
3106.
3107.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

3201.
3202.
3203.
3204.
3205.
3206.
3207.
3208.
3209.
3210.

Subtitle B—Agricultural Trade Act of 1978
Exporter assistance initiative.
Export credit guarantee program.
Market access program.
Export enhancement program.
Foreign market development cooperator program.
Food for progress.
McGovern-Dole International Food for Education and Child Nutrition
Program.
Subtitle C—Miscellaneous
Surplus commodities for developing or friendly countries.
Bill Emerson Humanitarian Trust Act.
Emerging markets.
Biotechnology and agricultural trade program.
Technical assistance for specialty crops.
Global market strategy.
Report on use of perishable commodities and live animals.
Study on fee for services.
Sense of Congress concerning foreign assistance programs.
Sense of the Senate concerning agricultural trade.
TITLE IV—NUTRITION PROGRAMS

Sec. 4001. Short title.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

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4101.
4102.
4103.
4104.
4105.
4106.
4107.

Subtitle A—Food Stamp Program
Encouragement of payment of child support.
Simplified definition of income.
Standard deduction.
Simplified utility allowance.
Simplified determination of housing costs.
Simplified determination of deductions.
Simplified definition of resources.

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PUBLIC LAW 107–171—MAY 13, 2002
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

4108.
4109.
4110.
4111.
4112.
4113.
4114.
4115.
4116.

Sec.
Sec.
Sec.
Sec.

4117.
4118.
4119.
4120.

116 STAT. 137

Sec.
Sec.
Sec.
Sec.

4123.
4124.
4125.
4126.

Alternative issuance systems in disasters.
State option to reduce reporting requirements.
Cost neutrality for electronic benefit transfer systems.
Report on electronic benefit transfer systems.
Alternative procedures for residents of certain group facilities.
Redemption of benefits through group living arrangements.
Availability of food stamp program applications on the Internet.
Transitional food stamps for families moving from welfare.
Grants for simple application and eligibility determination systems and
improved access to benefits.
Delivery to retailers of notices of adverse action.
Reform of quality control system.
Improvement of calculation of State performance measures.
Bonuses for States that demonstrate high or most improved performance.
Employment and training program.
Reauthorization of food stamp program and food distribution program on
Indian reservations.
Expanded grant authority.
Consolidated block grants for Puerto Rico and American Samoa.
Assistance for community food projects.
Availability of commodities for the emergency food assistance program.

Sec.
Sec.
Sec.
Sec.

4201.
4202.
4203.
4204.

Subtitle B—Commodity Distribution
Commodity supplemental food program.
Commodity donations.
Distribution of surplus commodities to special nutrition projects.
Emergency food assistance.

Sec. 4121.
Sec. 4122.

Subtitle C—Child Nutrition and Related Programs
Commodities for school lunch program.
Eligibility for free and reduced price meals.
Purchases of locally produced foods.
Applicability of Buy-American requirement to Puerto Rico.
Fruit and vegetable pilot program.
Eligibility for assistance under the special supplemental nutrition program for women, infants, and children.
Sec. 4307. WIC farmers’ market nutrition program.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

4301.
4302.
4303.
4304.
4305.
4306.

Sec.
Sec.
Sec.
Sec.
Sec.

4401.
4402.
4403.
4404.
4405.

Subtitle D—Miscellaneous
Partial restoration of benefits to legal immigrants.
Seniors farmers’ market nutrition program.
Nutrition information and awareness pilot program.
Hunger fellowship program.
General effective date.
TITLE V—CREDIT
Subtitle A—Farm Ownership Loans

Sec.
Sec.
Sec.
Sec.

5001.
5002.
5003.
5004.

Direct loans.
Financing of bridge loans.
Amount of guarantee of loans for farm operations on tribal lands.
Guarantee of loans made under State beginning farmer or rancher programs.
Sec. 5005. Down Payment Loan Program.
Sec. 5006. Beginning farmer and rancher contract land sales program.
Subtitle B—Operating Loans
Sec. 5101. Direct loans.
Sec. 5102. Suspension of limitation on period for which borrowers are eligible for
guaranteed assistance.
Subtitle C—Emergency Loans
Sec. 5201. Emergency loans in response to an emergency resulting from quarantines.
Subtitle D—Administrative Provisions
Sec. 5301. Evaluations of direct and guaranteed loan programs.
Sec. 5302. Eligibility of trusts and limited liability companies for farm ownership
loans, farm operating loans, and emergency loans.

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116 STAT. 138
Sec.
Sec.
Sec.
Sec.

PUBLIC LAW 107–171—MAY 13, 2002
5303.
5304.
5305.
5306.

Sec. 5307.
Sec. 5308.
Sec. 5309.
Sec. 5310.
Sec. 5311.
Sec. 5312.
Sec. 5313.
Sec. 5314.
Sec. 5315.
Sec.
Sec.
Sec.
Sec.
Sec.

5316.
5317.
5318.
5319.
5320.

Sec. 5321.

Debt settlement.
Temporary authority to enter into contracts; private collection agencies.
Interest rate options for loans in servicing.
Elimination of requirement that Secretary require county committees to
certify in writing that certain loan reviews have been conducted.
Simplified loan guarantee application available for loans of greater
amounts.
Inventory property.
Administration of certified lenders and preferred certified lenders programs.
Definitions.
Loan authorization levels.
Reservation of funds for direct operating loans for beginning farmers
and ranchers.
Interest rate reduction program.
Reamortization of recapture payments.
Allocation of certain funds for socially disadvantaged farmers and ranchers.
Waiver of borrower training certification requirement.
Timing of loan assessments.
Annual review of borrowers.
Loan eligibility for borrowers with prior debt forgiveness.
Making and servicing of loans by personnel of State, county, or area
committees.
Eligibility of employees of State, county, or area committee for loans and
loan guarantees.

Subtitle E—Farm Credit
Sec. 5401. Repeal of burdensome approval requirements.
Sec. 5402. Banks for cooperatives.
Sec. 5403. Insurance corporation premiums.
Subtitle F—General Provisions
Sec. 5501. Technical amendments.
TITLE VI—RURAL DEVELOPMENT
Subtitle A—Consolidated Farm and Rural Development Act
Sec. 6001. Eligibility of rural empowerment zones and rural enterprise communities for direct and guaranteed loans for essential community facilities.
Sec. 6002. Water or waste disposal grants.
Sec. 6003. Rural business opportunity grants.
Sec. 6004. Child day care facilities.
Sec. 6005. Rural water and wastewater circuit rider program.
Sec. 6006. Multijurisdictional regional planning organizations.
Sec. 6007. Loan guarantees for certain rural development loans.
Sec. 6008. Tribal college and university essential community facilities.
Sec. 6009. Emergency and imminent community water assistance grant program.
Sec. 6010. Water and waste facility grants for Native American tribes.
Sec. 6011. Grants for water systems for rural and native villages in Alaska.
Sec. 6012. Grants to nonprofit organizations to finance the construction, refurbishing, and servicing of individually-owned household water well systems in rural areas for individuals with low or moderate incomes.
Sec. 6013. Loans and loan guarantees for renewable energy systems.
Sec. 6014. Rural business enterprise grants.
Sec. 6015. Rural cooperative development grants.
Sec. 6016. Grants to broadcasting systems.
Sec. 6017. Business and industry loan modifications.
Sec. 6018. Use of rural development loans and grants for other purposes.
Sec. 6019. Simplified application forms for loan guarantees.
Sec. 6020. Definition of rural and rural area.
Sec. 6021. National Rural Development Partnership.
Sec. 6022. Rural telework.
Sec. 6023. Historic barn preservation.
Sec. 6024. Grants for NOAA weather radio transmitters.
Sec. 6025. Grants to train farm workers in new technologies and to train farm
workers in specialized skills necessary for higher value crops.
Sec. 6026. Rural community advancement program.
Sec. 6027. Delta Regional Authority.
Sec. 6028. Northern Great Plains Regional Authority.

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116 STAT. 139

Sec. 6029. Rural business investment program.
Sec. 6030. Rural strategic investment program.
Sec. 6031. Funding of pending rural development loan and grant applications.
Subtitle B—Rural Electrification Act of 1936
Sec. 6101. Guarantees for bonds and notes issued for electrification or telephone
purposes.
Sec. 6102. Expansion of 911 access.
Sec. 6103. Enhancement of access to broadband service in rural areas.
Subtitle C—Food, Agriculture, Conservation, and Trade Act of 1990
Sec. 6201. Alternative Agricultural Research and Commercialization Corporation.
Sec. 6202. Rural electronic commerce extension program.
Sec. 6203. Telemedicine and distance learning services in rural areas.
Sec.
Sec.
Sec.
Sec.

6301.
6302.
6303.
6304.

Subtitle D—SEARCH Grants for Small Communities
Definitions.
SEARCH grant program.
Report.
Funding.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

6401.
6402.
6403.
6404.
6405.
6406.

Subtitle E—Miscellaneous
Value-added agricultural product market development grants.
Agriculture innovation center demonstration program.
Fund for Rural America.
Rural local television broadcast signal loan guarantees.
Rural firefighters and emergency personnel grant program.
Sense of Congress on rural policy coordination.
TITLE VII—RESEARCH AND RELATED MATTERS

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

7101.
7102.
7103.
7104.
7105.
7106.
7107.
7108.
7109.

Sec. 7110.
Sec. 7111.
Sec. 7112.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

7113.
7114.
7115.
7116.
7117.
7118.
7119.
7120.
7121.
7122.
7123.
7124.
7125.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

7126.
7127.
7128.
7129.
7130.
7131.

Sec. 7132.
Sec. 7133.
Sec. 7134.

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Subtitle A—Extensions
National rural information center clearinghouse.
Grants and fellowships for food and agricultural sciences education.
Policy research centers.
Human nutrition intervention and health promotion research program.
Pilot research program to combine medical and agricultural research.
Nutrition education program.
Continuing animal health and disease research programs.
Appropriations for research on national or regional problems.
Grants to upgrade agricultural and food sciences facilities at 1890 landgrant colleges, including Tuskegee University.
National research and training virtual centers.
Hispanic-serving institutions.
Competitive grants for international agricultural science and education
programs.
University research.
Extension service.
Supplemental and alternative crops.
Aquaculture research facilities.
Rangeland research.
National genetics resources program.
High-priority research and extension initiatives.
Nutrient management research and extension initiative.
Agricultural telecommunications program.
Assistive technology program for farmers with disabilities.
Partnerships for high-value agricultural product quality research.
Biobased products.
Integrated research, education, and extension competitive grants program.
Equity in Educational Land-Grant Status Act of 1994.
1994 Institution research grants.
Endowment for 1994 Institutions.
Precision agriculture.
Thomas Jefferson Initiative for crop diversification.
Support for research regarding diseases of wheat, triticale, and barley
caused by fusarium graminearum or by tilletia indica.
Office of Pest Management Policy.
National Agricultural Research, Extension, Education, and Economics
Advisory Board.
Grants for research on production and marketing of alcohols and industrial hydrocarbons from agricultural commodities and forest products.

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Sec. 7135. Agricultural experiment stations research facilities.
Sec. 7136. Competitive, special, and facilities research grants national research initiative.
Sec. 7137. Federal agricultural research facilities authorization of appropriations.
Sec. 7138. Critical agricultural materials research.
Sec. 7139. Aquaculture.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

7201.
7202.
7203.
7204.
7205.
7206.
7207.
7208.
7209.

Sec. 7210.
Sec. 7211.
Sec. 7212.
Sec. 7213.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

7214.
7215.
7216.
7217.
7218.
7219.
7220.
7221.
7222.
7223.

Subtitle B—Modifications
Equity in Educational Land-Grant Status Act of 1994.
Carryover for experiment stations.
Authorization percentages for research and extension formula funds.
Carryover for eligible institutions.
Initiative for future agriculture and food systems.
Eligibility for integrated grants program.
Agricultural Research, Extension, and Education Reform Act of 1998.
Food, Agriculture, Conservation, and Trade Act of 1990.
National Agricultural Research, Extension, and Teaching Policy Act of
1977.
Biotechnology risk assessment research.
Competitive, special, and facilities research grants.
Matching funds requirement for research and extension activities of
1890 Institutions.
Matching requirements for research and extension formula funds for insular area land-grant institutions.
Definition of food and agricultural sciences.
Federal Extension Service.
Policy research centers.
Availability of competitive grant funds.
Organic agriculture research and extension initiative.
Senior scientific research service.
Termination of certain schedule a appointments.
Biosecurity planning and response programs.
Indirect costs for small business innovation research grants.
Carbon cycle research.

Subtitle C—Repeal of Certain Activities and Authorities
Sec. 7301. Food Safety Research Information Office and National Conference.
Sec. 7302. Reimbursement of expenses under Sheep Promotion, Research, and Information Act of 1994.
Sec. 7303. Market expansion research.
Sec. 7304. National Advisory Board on Agricultural Weather.
Sec. 7305. Agricultural information exchange with Ireland.
Sec. 7306. Pesticide resistance study.
Sec. 7307. Expansion of education study.
Sec. 7308. Task force on 10-year strategic plan for agricultural research facilities.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

7401.
7402.
7403.
7404.
7405.
7406.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

7407.
7408.
7409.
7410.
7411.
7412.

Subtitle D—New Authorities
Subtitle definitions.
Research equipment grants.
Joint requests for proposals.
Review of Agricultural Research Service.
Beginning farmer and rancher development program.
Sense of Congress regarding doubling of funding for agricultural research.
Organic production and market data initiatives.
International organic research collaboration.
Report on producers and handlers of organic agricultural products.
Report on genetically modified pest-protected plants.
Study of nutrient banking.
Grants for youth organizations.

Subtitle E—Miscellaneous
Sec. 7501. Resident instruction and distance education at institutions of higher
education in United States insular areas.
Sec. 7502. Definitions.
Sec. 7503. Resident instruction and distance education grants program for insular
area institutions of higher education.
Sec. 7504. Declaration of extraordinary emergency and resulting authorities.
Sec. 7505. Agricultural biotechnology research and development for developing
countries.
Sec. 7506. Land acquisition authority, national peanut research laboratory, Dawson, Georgia.

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TITLE VIII—FORESTRY
Subtitle A—Cooperative Forestry Assistance Act of 1978
Sec. 8001. Repeal of forestry incentives program and stewardship incentive program.
Sec. 8002. Establishment of forest land enhancement program.
Sec. 8003. Enhanced community fire protection.
Subtitle B—Amendments to Other Laws
Sec. 8101. Sustainable forestry outreach initiative; renewable resources extension
activities.
Sec. 8102. Office of International Forestry.
Subtitle C—Miscellaneous Provisions
Sec. 8201. McIntire-Stennis cooperative forestry research program.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

9001.
9002.
9003.
9004.
9005.
9006.
9007.
9008.
9009.
9010.

TITLE IX—ENERGY
Definitions.
Federal procurement of biobased products.
Biorefinery development grants.
Biodiesel fuel education program.
Energy audit and renewable energy development program.
Renewable energy systems and energy efficiency improvements.
Hydrogen and fuel cell technologies.
Biomass research and development.
Cooperative research and extension projects.
Continuation of bioenergy program.
TITLE X—MISCELLANEOUS

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

10001.
10002.
10003.
10004.
10005.
10006.

Subtitle A—Crop Insurance
Equal crop insurance treatment of potatoes and sweet potatoes.
Continuous coverage.
Quality loss adjustment procedures.
Adjusted gross revenue insurance pilot program.
Sense of Congress on expansion of crop insurance coverage.
Report on specialty crop insurance.

Subtitle B—Disaster Assistance
Sec. 10101. Reference to sea grass and sea oats as crops covered by noninsured
crop disaster assistance program.
Sec. 10102. Emergency grants to assist low-income migrant and seasonal farmworkers.
Sec. 10103. Emergency loans for seed producers.
Sec. 10104. Assistance for livestock producers.
Sec. 10105. Market loss assistance for apple producers.
Sec. 10106. Market loss assistance for onion producers.
Sec. 10107. Commercial fisheries failure.
Sec. 10108. Study of feasibility of producer indemnification from Governmentcaused disasters.

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Sec.
Sec.
Sec.
Sec.
Sec.

10201.
10202.
10203.
10204.
10205.

Subtitle C—Tree Assistance Program
Definitions.
Eligibility.
Assistance.
Limitations on assistance.
Authorization of appropriations.

Sec.
Sec.
Sec.
Sec.
Sec.

10301.
10302.
10303.
10304.
10305.

Subtitle D—Animal Welfare
Definition of animal under the Animal Welfare Act.
Prohibition on interstate movement of animals for animal fighting.
Penalties and foreign commerce provisions of the Animal Welfare Act.
Report on rats, mice, and birds.
Enforcement of Humane Methods of Slaughter Act of 1958.

Sec.
Sec.
Sec.
Sec.

10401.
10402.
10403.
10404.

Subtitle E—Animal Health Protection
Short title.
Findings.
Definitions.
Restriction on importation or entry.

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Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

10405.
10406.
10407.
10408.
10409.
10410.
10411.
10412.
10413.
10414.
10415.
10416.
10417.
10418.

Exportation.
Interstate movement.
Seizure, quarantine, and disposal.
Inspections, seizures, and warrants.
Detection, control, and eradication of diseases and pests.
Veterinary accreditation program.
Cooperation.
Reimbursable agreements.
Administration and claims.
Penalties.
Enforcement.
Regulations and orders.
Authorization of appropriations.
Repeals and conforming amendments.

Sec.
Sec.
Sec.
Sec.
Sec.

10501.
10502.
10503.
10504.
10505.

Subtitle F—Livestock
Transportation of poultry and other animals.
Swine contractors.
Right to discuss terms of contract.
Veterinary training.
Pseudorabies eradication program.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

10601.
10602.
10603.
10604.
10605.
10606.
10607.
10608.

Subtitle G—Specialty Crops
Marketing orders for caneberries.
Availability of section 32 funds.
Purchase of specialty crops.
Protection for purchasers of farm products.
Farmers’ market promotion program.
National organic certification cost-share program.
Exemption of certified organic products from assessments.
Cranberry acreage reserve program.

Subtitle H—Administration
Initial rate of basic pay for employees of county committees.
Commodity Futures Trading Commission pay comparability.
Overtime and holiday pay.
Assistant Secretary of Agriculture for Civil Rights.
Operation of Graduate School of Department of Agriculture.
Implementation funding and information management.
Outreach and assistance for socially disadvantaged farmers and ranchers.
Sec. 10708. Transparency and accountability for socially disadvantaged farmers
and ranchers; public disclosure requirements for county committee elections.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

10701.
10702.
10703.
10704.
10705.
10706.
10707.

Subtitle I—General Provisions
Sec. 10801. Cotton classification services.
Sec. 10802. Program of public education regarding use of biotechnology in producing food for human consumption.
Sec. 10803. Chino Dairy Preserve Project.
Sec. 10804. Grazinglands Research Laboratory.
Sec. 10805. Food and Agricultural Policy Research Institute.
Sec. 10806. Market names for catfish and ginseng.
Sec. 10807. Food Safety Commission.
Sec. 10808. Pasteurization.
Sec. 10809. Rulemaking on labeling of irradiated food; certain petitions.
Sec. 10810. Penalties for violations of Plant Protection Act.
Sec. 10811. Preclearance quarantine inspections.
Sec. 10812. Connecticut River Atlantic Salmon Commission.
Sec. 10813. Pine Point School.
Sec. 10814. 7-month extension of chapter 12 of title 11 of the United States Code.
Sec. 10815. Practices involving nonambulatory livestock.
Sec. 10816. Country of origin labeling.
Sec.
Sec.
Sec.
Sec.
Sec.

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10901.
10902.
10903.
10904.
10905.

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Subtitle J—Miscellaneous Studies and Reports
Report on specialty crop purchases.
Report on pouched and canned salmon.
Study on updating yields.
Report on effect of farm program payments.
Chiloquin Dam fish passage feasibility study.

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Sec.
Sec.
Sec.
Sec.
Sec.

10906.
10907.
10908.
10909.
10910.

116 STAT. 143

Report on geographically disadvantaged farmers and ranchers.
Studies on agricultural research and technology.
Report on tobacco settlement agreement.
Report on sale and use of pesticides for agricultural uses.
Review of operation of agricultural and natural resource programs on
tribal trust land.

TITLE I—COMMODITY PROGRAMS
SEC. 1001. DEFINITIONS.

7 USC 7901.

In this title (other than subtitle C):
(1) AGRICULTURAL ACT OF 1949.—The term ‘‘Agricultural
Act of 1949’’ means the Agricultural Act of 1949 (7 U.S.C.
1421 et seq.), as in effect prior to the suspensions under section
171 of the Federal Agriculture Improvement and Reform Act
of 1996 (7 U.S.C. 7301).
(2) BASE ACRES.—The term ‘‘base acres’’, with respect to
a covered commodity on a farm, means the number of acres
established under section 1101 with respect to the covered
commodity on the election made by the owner of the farm
under subsection (a) of such section.
(3) COUNTER-CYCLICAL PAYMENT.—The term ‘‘countercyclical payment’’ means a payment made to producers on
a farm under section 1104.
(4) COVERED COMMODITY.—The term ‘‘covered commodity’’
means wheat, corn, grain sorghum, barley, oats, upland cotton,
rice, soybeans, and other oilseeds.
(5) DIRECT PAYMENT.—The term ‘‘direct payment’’ means
a payment made to producers on a farm under section 1103.
(6) EFFECTIVE PRICE.—The term ‘‘effective price’’, with
respect to a covered commodity for a crop year, means the
price calculated by the Secretary under section 1104 to determine whether counter-cyclical payments are required to be
made for that crop year.
(7) EXTRA LONG STAPLE COTTON.—The term ‘‘extra long
staple cotton’’ means cotton that—
(A) is produced from pure strain varieties of the
Barbadense species or any hybrid thereof, or other similar
types of extra long staple cotton, designated by the Secretary, having characteristics needed for various end uses
for which United States upland cotton is not suitable and
grown in irrigated cotton-growing regions of the United
States designated by the Secretary or other areas designated by the Secretary as suitable for the production
of the varieties or types; and
(B) is ginned on a roller-type gin or, if authorized
by the Secretary, ginned on another type gin for experimental purposes.
(8) LOAN COMMODITY.—The term ‘loan commodity’ means
wheat, corn, grain sorghum, barley, oats, upland cotton, extra
long staple cotton, rice, soybeans, other oilseeds, wool, mohair,
honey, dry peas, lentils, and small chickpeas.
(9) OTHER OILSEED.—The term ‘‘other oilseed’’ means a
crop of sunflower seed, rapeseed, canola, safflower, flaxseed,
mustard seed, or, if designated by the Secretary, another oilseed.
(10) PAYMENT ACRES.—The term ‘‘payment acres’’ means
85 percent of the base acres of a covered commodity on a

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farm, as established under section 1101, on which direct payments and counter-cyclical payments are made.
(11) PAYMENT YIELD.—
(A) IN GENERAL.—The term ‘‘payment yield’’ means
the yield established under section 1102 for a farm for
a covered commodity.
(B) UPDATED PAYMENT YIELD.—The term ‘‘updated payment yield’’ means the payment yield elected by the owner
of a farm under section 1102(e) to be used in calculating
the counter-cyclical payments for the farm.
(12) PRODUCER.—The term ‘‘producer’’ means an owner,
operator, landlord, tenant, or sharecropper that shares in the
risk of producing a crop and is entitled to share in the crop
available for marketing from the farm, or would have shared
had the crop been produced. In determining whether a grower
of hybrid seed is a producer, the Secretary shall not take
into consideration the existence of a hybrid seed contract and
shall ensure that program requirements do not adversely affect
the ability of the grower to receive a payment under this
title.
(13) SECRETARY.—The term ‘‘Secretary’’ means the Secretary of Agriculture.
(14) STATE.—The term ‘‘State’’ means each of the several
States of the United States, the District of Columbia, the
Commonwealth of Puerto Rico, and any other territory or
possession of the United States.
(15) TARGET PRICE.—The term ‘‘target price’’ means the
price per bushel (or other appropriate unit in the case of upland
cotton, rice, and other oilseeds) of a covered commodity used
to determine the payment rate for counter-cyclical payments.
(16) UNITED STATES.—The term ‘‘United States’’, when used
in a geographical sense, means all of the States.

Subtitle A—Direct Payments and CounterCyclical Payments
7 USC 7911.

SEC. 1101. ESTABLISHMENT OF BASE ACRES AND PAYMENT ACRES
FOR A FARM.

(a) ELECTION BY OWNER OF BASE ACRES CALCULATION
METHOD.—
(1) ALTERNATIVE CALCULATION METHODS.—For the purpose
of making direct payments and counter-cyclical payments with
respect to a farm, the Secretary shall give an owner of the
farm an opportunity to elect 1 of the following as the method
by which the base acres of all covered commodities on the
farm are to be determined:
(A) Subject to paragraphs (3) and (4), the 4-year average of the following:
(i) Acreage planted on the farm to covered commodities for harvest, grazing, haying, silage, or other
similar purposes for the 1998 through 2001 crop years.
(ii) Any acreage on the farm that the producers
were prevented from planting during the 1998 through
2001 crop years to covered commodities because of

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drought, flood, or other natural disaster, or other condition beyond the control of the producers, as determined
by the Secretary.
(B) Subject to paragraph (3), the sum of the following:
(i) The contract acreage (as defined in section 102
of the Federal Agriculture Improvement and Reform
Act of 1996 (7 U.S.C. 7202)) used by the Secretary
to calculate the fiscal year 2002 payment authorized
under section 114 of such Act (7 U.S.C. 7214) for
the covered commodities on the farm.
(ii) The 4-year average of eligible oilseed acreage
on the farm for the 1998 through 2001 crop years,
as determined by the Secretary under paragraph (2).
(2) ELIGIBLE OILSEED ACREAGE.—
(A) CALCULATION.—For purposes of paragraph
(1)(B)(ii), the eligible acreage for each oilseed on a farm
during each of the 1998 through 2001 crop years shall
be determined in the manner provided in paragraph (1)(A),
except that the total acreage for all oilseeds on the farm
for a crop year may not exceed the difference between—
(i) the total acreage determined under paragraph
(1)(A) for all covered commodities for that crop year;
and
(ii) the total contract acreage determined under
paragraph (1)(B)(i).
(B) EFFECT OF NEGATIVE NUMBER.—If the subtraction
performed under subparagraph (A) results in a negative
number, the eligible oilseed acreage on the farm for that
crop year shall be zero for purposes of determining the
4-year average.
(C) OFFSET OF CONTRACT ACREAGE.—The owner of a
farm may increase the eligible acreage for an oilseed on
the farm by reducing the contract acreage determined
under paragraph (1)(B)(i) for 1 or more covered commodities
on an acre-for-acre basis, except that the total base acreage
for each oilseed on the farm may not exceed the 4-year
average of each oilseed determined under paragraph
(1)(B)(ii).
(3) INCLUSION OF ALL 4 YEARS IN AVERAGE.—For the purpose
of determining a 4-year acreage average under this subsection
for a farm, the Secretary shall not exclude any crop year
in which a covered commodity was not planted.
(4) TREATMENT OF MULTIPLE PLANTING OR PREVENTED
PLANTING.—For the purpose of determining under paragraph
(1)(A) the acreage on a farm that producers planted or were
prevented from planting during the 1998 through 2001 crop
years to covered commodities, if the acreage that was planted
or prevented from being planted was devoted to another covered
commodity in the same crop year (other than a covered commodity produced under an established practice of double cropping), the owner may elect the commodity to be used for that
crop year in determining the 4-year average, but may not
include both the initial commodity and the subsequent commodity.
(b) SINGLE ELECTION; TIME FOR ELECTION.—
(1) NOTICE OF ELECTION OPPORTUNITY.—As soon as practicable after the date of enactment of this Act, the Secretary

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shall provide notice to owners of farms regarding their opportunity to make the election described in subsection (a). The
notice shall include the following:
(A) Notice that the opportunity of an owner to make
the election is being provided only once.
(B) Information regarding the manner in which the
election must be made and the time periods and manner
in which notice of the election must be submitted to the
Secretary.
(2) ELECTION DEADLINE.—Within the time period and in
the manner prescribed pursuant to paragraph (1), the owner
of a farm shall submit to the Secretary notice of the election
made by the owner under subsection (a).
(c) EFFECT OF FAILURE TO MAKE ELECTION.—If the owner
of a farm fails to make the election under subsection (a) or fails
to timely notify the Secretary of the election made, as required
by subsection (b), the owner shall be deemed to have made the
election described in subsection (a)(1)(B) to determine base acres
for all covered commodities on the farm.
(d) APPLICATION OF ELECTION TO ALL COVERED COMMODITIES.—
The election made under subparagraph (A) or (B) of subsection
(a)(1), or deemed to be made under subsection (c), with respect
to a farm shall apply to all of the covered commodities on the
farm.
(e) TREATMENT OF CONSERVATION RESERVE CONTRACT ACREAGE.—
(1) IN GENERAL.—The Secretary shall provide for an adjustment, as appropriate, in the base acres for covered commodities
for a farm whenever either of the following circumstances
occurs:
(A) A conservation reserve contract entered into under
section 1231 of the Food Security Act of 1985 (16 U.S.C.
3831) with respect to the farm expires or is voluntarily
terminated.
(B) Cropland is released from coverage under a conservation reserve contract by the Secretary.
(2) SPECIAL PAYMENT RULES.—For the crop year in which
a base acres adjustment under paragraph (1) is first made,
the owner of the farm shall elect to receive either direct payments and counter-cyclical payments with respect to the acreage added to the farm under this subsection or a prorated
payment under the conservation reserve contract, but not both.
(f) PAYMENT ACRES.—The payment acres for a covered commodity on a farm shall be equal to 85 percent of the base acres
for the covered commodity.
(g) PREVENTION OF EXCESS BASE ACRES.—
(1) REQUIRED REDUCTION.—If the sum of the base acres
for a farm, together with the acreage described in paragraph
(2), exceeds the actual cropland acreage of the farm, the Secretary shall reduce the base acres for 1 or more covered
commodities for the farm or the base acres for peanuts for
the farm under subtitle C so that the sum of the base acres
and acreage described in paragraph (2) does not exceed the
actual cropland acreage of the farm.
(2) OTHER ACREAGE.—For purposes of paragraph (1), the
Secretary shall include the following:

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(A) Any base acres for peanuts for the farm under
subtitle C.
(B) Any acreage on the farm enrolled in the conservation reserve program or wetlands reserve program under
chapter 1 of subtitle D of title XII of the Food Security
Act of 1985 (16 U.S.C. 3830 et seq.).
(C) Any other acreage on the farm enrolled in a conservation program for which payments are made in
exchange for not producing an agricultural commodity on
the acreage.
(3) SELECTION OF ACRES.—The Secretary shall give the
owner of the farm the opportunity to select the base acres
or the base acres for peanuts for the farm under subtitle C
against which the reduction required by paragraph (1) will
be made.
(4) EXCEPTION FOR DOUBLE-CROPPED ACREAGE.—In
applying paragraph (1), the Secretary shall make an exception
in the case of double cropping, as determined by the Secretary.
(5) COORDINATED APPLICATION OF REQUIREMENTS.—The
Secretary shall take into account section 1302(f) when applying
the requirements of this subsection.
(h) PERMANENT REDUCTION IN BASE ACRES.—The owner of a
farm may reduce, at any time, the base acres for any covered
commodity for the farm. The reduction shall be permanent and
made in the manner prescribed by the Secretary.
SEC. 1102. ESTABLISHMENT OF PAYMENT YIELD.

(a) ESTABLISHMENT AND PURPOSE.—For the purpose of making
direct payments and counter-cyclical payments under this subtitle,
the Secretary shall provide for the establishment of a payment
yield for each farm for each covered commodity in accordance with
this section.
(b) USE OF FARM PROGRAM PAYMENT YIELD.—Except as otherwise provided in this section, the payment yield for each of the
2002 through 2007 crops of a covered commodity for a farm shall
be the farm program payment yield established for the 1995 crop
of the covered commodity under section 505 of the Agricultural
Act of 1949 (7 U.S.C. 1465), as adjusted by the Secretary to account
for any additional yield payments made with respect to that crop
under section 505(b)(2) of that Act.
(c) FARMS WITHOUT FARM PROGRAM PAYMENT YIELD.—In the
case of a farm for which a farm program payment yield is unavailable for a covered commodity (other than soybeans or other oilseeds),
the Secretary shall establish an appropriate payment yield for
the covered commodity on the farm taking into consideration the
farm program payment yields applicable to the commodity under
subsection (b) for similar farms, but before the yields for the similar
farms are updated as provided in subsection (e).
(d) PAYMENT YIELDS FOR OILSEEDS.—
(1) DETERMINATION OF AVERAGE YIELD.—In the case of soybeans and each other oilseed, the Secretary shall determine
the average yield per planted acre for the oilseed on a farm
for the 1998 through 2001 crop years, excluding any crop year
in which the acreage planted to the oilseed was zero.
(2) ADJUSTMENT FOR PAYMENT YIELD.—The payment yield
for a farm for an oilseed shall be equal to the product of
the following:

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(A) The average yield for the oilseed determined under
paragraph (1).
(B) The ratio resulting from dividing the national average yield for the oilseed for the 1981 through 1985 crops
by the national average yield for the oilseed for the 1998
through 2001 crops.
(3) USE OF PARTIAL COUNTY AVERAGE YIELD.—If the yield
per planted acre for a crop of an oilseed for a farm for any
of the 1998 through 2001 crop years was less than 75 percent
of the county yield for that oilseed, the Secretary shall assign
a yield for that crop year equal to 75 percent of the county
yield for the purpose of determining the average under paragraph (1).
(e) OPPORTUNITY TO PARTIALLY UPDATE YIELDS USED TO DETERMINE COUNTER-CYCLICAL PAYMENTS.—
(1) ELECTION TO UPDATE.—If the owner of a farm elects
to use the base acres calculation method described in section
1101(a)(1)(A), the owner shall also have a 1-time opportunity
to elect to use 1 of the methods described in paragraph (3)
to partially update the payment yields that would otherwise
be used in calculating any counter-cyclical payments for covered
commodities on the farm.
(2) TIME FOR ELECTION.—The election under paragraph
(1) shall be made at the same time and in the same manner
as the Secretary prescribes for the election required under
section 1101.
(3) METHODS OF UPDATING YIELDS.—If the owner of a farm
elects to update yields under this subsection, the payment
yield for a covered commodity on the farm, for the purpose
of calculating counter-cyclical payments only, shall be equal
to the yield determined using either of the following:
(A) The sum of the following:
(i) The payment yield applicable for direct payments for the covered commodity on the farm.
(ii) 70 percent of the difference between—
(I) the average yield per planted acre for the
crop of the covered commodity on the farm for
the 1998 through 2001 crop years, as determined
by the Secretary, excluding any crop year in which
the acreage planted to the crop of the covered
commodity was zero; and
(II) the payment yield applicable for direct
payments for the covered commodity on the farm.
(B) 93.5 percent of the average of the yield per planted
acre for the crop of the covered commodity on the farm
for the 1998 through 2001 crop years, as determined by
the Secretary, excluding any crop year in which the acreage
planted to the crop of the covered commodity was zero.
(4) USE OF PARTIAL COUNTY AVERAGE YIELD.—If the yield
per planted acre for a crop of the covered commodity for a
farm for any of the 1998 through 2001 crop years was less
than 75 percent of the county yield for that commodity, the
Secretary shall assign a yield for that crop year equal to 75
percent of the county yield for the purpose of determining
the average yield under paragraph (3).
(5) APPLICATION OF ELECTION AND METHOD TO ALL COVERED
COMMODITIES.—The owner of a farm may not elect the method

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described in paragraph (3)(A) for 1 covered commodity on the
farm and the method described in paragraph (3)(B) for other
covered commodities on the farm.
SEC. 1103. AVAILABILITY OF DIRECT PAYMENTS.

7 USC 7913.

(a) PAYMENT REQUIRED.—For each of the 2002 through 2007
crop years of each covered commodity, the Secretary shall make
direct payments to producers on farms for which payment yields
and base acres are established.
(b) PAYMENT RATE.—The payment rates used to make direct
payments with respect to covered commodities for a crop year
are as follows:
(1) Wheat, $0.52 per bushel.
(2) Corn, $0.28 per bushel.
(3) Grain sorghum, $0.35 per bushel.
(4) Barley, $0.24 per bushel.
(5) Oats, $0.024 per bushel.
(6) Upland cotton, $0.0667 per pound.
(7) Rice, $2.35 per hundredweight.
(8) Soybeans, $0.44 per bushel.
(9) Other oilseeds, $0.0080 per pound.
(c) PAYMENT AMOUNT.—The amount of the direct payment to
be paid to the producers on a farm for a covered commodity for
a crop year shall be equal to the product of the following:
(1) The payment rate specified in subsection (b).
(2) The payment acres of the covered commodity on the
farm.
(3) The payment yield for the covered commodity for the
farm.
(d) TIME FOR PAYMENT.—
(1) IN GENERAL.—The Secretary shall make direct
payments—
(A) in the case of the 2002 crop year, as soon as
practicable after the date of enactment of this Act; and
(B) in the case of each of the 2003 through 2007
crop years, not before October 1 of the calendar year in
which the crop of the covered commodity is harvested.
(2) ADVANCE PAYMENTS.—At the option of the producers
on a farm, up to 50 percent of the direct payment for a covered
commodity for any of the 2003 through 2007 crop years shall
be paid to the producers in advance. The producers shall select
the month within which the advance payment for a crop year
will be made. The month selected may be any month during
the period beginning on December 1 of the calendar year before
the calendar year in which the crop of the covered commodity
is harvested through the month within which the direct payment would otherwise be made. The producers may change
the selected month for a subsequent advance payment by providing advance notice to the Secretary.
(3) REPAYMENT OF ADVANCE PAYMENTS.—If a producer on
a farm that receives an advance direct payment for a crop
year ceases to be a producer on that farm, or the extent to
which the producer shares in the risk of producing a crop
changes, before the date the remainder of the direct payment
is made, the producer shall be responsible for repaying the
Secretary the applicable amount of the advance payment, as
determined by the Secretary.

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116 STAT. 150
7 USC 7914.

PUBLIC LAW 107–171—MAY 13, 2002

SEC. 1104. AVAILABILITY OF COUNTER-CYCLICAL PAYMENTS.

(a) PAYMENT REQUIRED.—For each of the 2002 through 2007
crop years for each covered commodity, the Secretary shall make
counter-cyclical payments to producers on farms for which payment
yields and base acres are established with respect to the covered
commodity if the Secretary determines that the effective price for
the covered commodity is less than the target price for the covered
commodity.
(b) EFFECTIVE PRICE.—For purposes of subsection (a), the effective price for a covered commodity is equal to the sum of the
following:
(1) The higher of the following:
(A) The national average market price received by
producers during the 12-month marketing year for the
covered commodity, as determined by the Secretary.
(B) The national average loan rate for a marketing
assistance loan for the covered commodity in effect for
the applicable period under subtitle B.
(2) The payment rate in effect for the covered commodity
under section 1103 for the purpose of making direct payments
with respect to the covered commodity.
(c) TARGET PRICE.—
(1) 2002 AND 2003 CROP YEARS.—For purposes of the 2002
and 2003 crop years, the target prices for covered commodities
shall be as follows:
(A) Wheat, $3.86 per bushel.
(B) Corn, $2.60 per bushel.
(C) Grain sorghum, $2.54 per bushel.
(D) Barley, $2.21 per bushel.
(E) Oats, $1.40 per bushel.
(F) Upland cotton, $0.7240 per pound.
(G) Rice, $10.50 per hundredweight.
(H) Soybeans, $5.80 per bushel.
(I) Other oilseeds, $0.0980 per pound.
(2) SUBSEQUENT CROP YEARS.—For purposes of each of the
2004 through 2007 crop years, the target prices for covered
commodities shall be as follows:
(A) Wheat, $3.92 per bushel.
(B) Corn, $2.63 per bushel.
(C) Grain sorghum, $2.57 per bushel.
(D) Barley, $2.24 per bushel.
(E) Oats, $1.44 per bushel.
(F) Upland cotton, $0.7240 per pound.
(G) Rice, $10.50 per hundredweight.
(H) Soybeans, $5.80 per bushel.
(I) Other oilseeds, $0.1010 per pound.
(d) PAYMENT RATE.—The payment rate used to make countercyclical payments with respect to a covered commodity for a crop
year shall be equal to the difference between—
(1) the target price for the covered commodity; and
(2) the effective price determined under subsection (b) for
the covered commodity.
(e) PAYMENT AMOUNT.—If counter-cyclical payments are
required to be paid for any of the 2002 through 2007 crop years
of a covered commodity, the amount of the counter-cyclical payment
to be paid to the producers on a farm for that crop year shall
be equal to the product of the following:

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(1) The payment rate specified in subsection (d).
(2) The payment acres of the covered commodity on the
farm.
(3) The payment yield or updated payment yield for the
farm, depending on the election of the owner of the farm under
section 1102.
(f) TIME FOR PAYMENTS.—
(1) GENERAL RULE.—If the Secretary determines under subsection (a) that counter-cyclical payments are required to be
made under this section for the crop of a covered commodity,
the Secretary shall make the counter-cyclical payments for
the crop as soon as practicable after the end of the 12-month
marketing year for the covered commodity.
(2) AVAILABILITY OF PARTIAL PAYMENTS.—If, before the end
of the 12-month marketing year for a covered commodity, the
Secretary estimates that counter-cyclical payments will be
required for the crop of the covered commodity, the Secretary
shall give producers on a farm the option to receive partial
payments of the counter-cyclical payment projected to be made
for that crop of the covered commodity.
(3) TIME FOR PARTIAL PAYMENTS.—
(A) 2002 THROUGH 2006 CROP YEARS.—When the Secretary makes partial payments available under paragraph
(2) for a covered commodity for any of the 2002 through
2006 crop years—
(i) the first partial payment for the crop year shall
be made not earlier than October 1, and, to the maximum extent practicable, not later than October 31,
of the calendar year in which the crop of the covered
commodity is harvested;
(ii) the second partial payment shall be made not
earlier than February 1 of the next calendar year;
and
(iii) the final partial payment shall be made as
soon as practicable after the end of the 12-month marketing year for the covered commodity.
(B) 2007 CROP YEAR.—When the Secretary makes partial payments available for a covered commodity for the
2007 crop year—
(i) the first partial payment shall be made after
completion of the first 6 months of the marketing year
for the covered commodity; and
(ii) the final partial payment shall be made as
soon as practicable after the end of the 12-month marketing year for the covered commodity.
(4) AMOUNT OF PARTIAL PAYMENTS.—
(A) 2002 THROUGH 2006 CROP YEARS.—
(i) FIRST PARTIAL PAYMENT.—For each of the 2002
through 2006 crop years of a covered commodity, the
first partial payment under paragraph (3) to the producers on a farm may not exceed 35 percent of the
projected counter-cyclical payment for the covered commodity for the crop year, as determined by the Secretary.
(ii) SECOND PARTIAL PAYMENT.—The second partial
payment for a covered commodity for a crop year may
not exceed the difference between—

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(I) 70 percent of the projected counter-cyclical
payment (including any revision thereof) for the
crop of the covered commodity; and
(II) the amount of the payment made under
clause (i).
(iii) FINAL PAYMENT.—The final payment for a covered commodity for a crop year shall be equal to the
difference between—
(I) the actual counter-cyclical payment to be
made to the producers for the covered commodity
for that crop year; and
(II) the amount of the partial payments made
to the producers under clauses (i) and (ii) for that
crop year.
(B) 2007 CROP YEAR.—
(i) FIRST PARTIAL PAYMENT.—For the 2007 crop
year, the first partial payment under paragraph (3)
to the producers on a farm may not exceed 40 percent
of the projected counter-cyclical payment for the covered commodity for the crop year, as determined by
the Secretary.
(ii) FINAL PAYMENT.—The final payment for the
2007 crop year shall be equal to the difference
between—
(I) the actual counter-cyclical payment to be
made to the producers for the covered commodity
for that crop year; and
(II) the amount of the partial payment made
to the producers under clause (i).
(5) REPAYMENT.—The producers on a farm that receive
a partial payment under this subsection for a crop year shall
repay to the Secretary the amount, if any, by which the total
of the partial payments exceed the actual counter-cyclical payment to be made for the covered commodity for that crop
year.

7 USC 7915.

SEC. 1105. PRODUCER AGREEMENT REQUIRED AS CONDITION OF
PROVISION OF DIRECT PAYMENTS AND COUNTERCYCLICAL PAYMENTS.

(a) COMPLIANCE WITH CERTAIN REQUIREMENTS.—
(1) REQUIREMENTS.—Before the producers on a farm may
receive direct payments or counter-cyclical payments with
respect to the farm, the producers shall agree, during the
crop year for which the payments are made and in exchange
for the payments—
(A) to comply with applicable conservation requirements under subtitle B of title XII of the Food Security
Act of 1985 (16 U.S.C. 3811 et seq.);
(B) to comply with applicable wetland protection
requirements under subtitle C of title XII of the Act (16
U.S.C. 3821 et seq.);
(C) to comply with the planting flexibility requirements
of section 1106;
(D) to use the land on the farm, in a quantity equal
to the attributable base acres for the farm and any base
acres for peanuts for the farm under subtitle C for an

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agricultural or conserving use, and not for a nonagricultural commercial or industrial use, as determined
by the Secretary; and
(E) to effectively control noxious weeds and otherwise
maintain the land in accordance with sound agricultural
practices, as determined by the Secretary, if the agricultural or conserving use involves the noncultivation of any
portion of the land referred to in subparagraph (D).
(2) COMPLIANCE.—The Secretary may issue such rules as
the Secretary considers necessary to ensure producer compliance with the requirements of paragraph (1).
(3) MODIFICATION.—At the request of the transferee or
owner, the Secretary may modify the requirements of this subsection if the modifications are consistent with the objectives
of this subsection, as determined by the Secretary.
(b) TRANSFER OR CHANGE OF INTEREST IN FARM.—
(1) TERMINATION.—Except as provided in paragraph (2),
a transfer of (or change in) the interest of the producers on
a farm in base acres for which direct payments or countercyclical payments are made shall result in the termination
of the payments with respect to the base acres, unless the
transferee or owner of the acreage agrees to assume all obligations under subsection (a). The termination shall take effect
on the date determined by the Secretary.
(2) EXCEPTION.—If a producer entitled to a direct payment
or counter-cyclical payment dies, becomes incompetent, or is
otherwise unable to receive the payment, the Secretary shall
make the payment, in accordance with rules issued by the
Secretary.
(c) ACREAGE REPORTS.—As a condition on the receipt of any
benefits under this subtitle or subtitle B, the Secretary shall require
producers on a farm to submit to the Secretary annual acreage
reports with respect to all cropland on the farm.
(d) TENANTS AND SHARECROPPERS.—In carrying out this subtitle, the Secretary shall provide adequate safeguards to protect
the interests of tenants and sharecroppers.
(e) SHARING OF PAYMENTS.—The Secretary shall provide for
the sharing of direct payments and counter-cyclical payments among
the producers on a farm on a fair and equitable basis.
SEC. 1106. PLANTING FLEXIBILITY.

7 USC 7916.

(a) PERMITTED CROPS.—Subject to subsection (b), any commodity or crop may be planted on base acres on a farm.
(b) LIMITATIONS REGARDING CERTAIN COMMODITIES.—
(1) GENERAL LIMITATION.—The planting of an agricultural
commodity specified in paragraph (3) shall be prohibited on
base acres unless the commodity, if planted, is destroyed before
harvest.
(2) TREATMENT OF TREES AND OTHER PERENNIALS.—The
planting of an agricultural commodity specified in paragraph
(3) that is produced on a tree or other perennial plant shall
be prohibited on base acres.
(3) COVERED AGRICULTURAL COMMODITIES.—Paragraphs (1)
and (2) apply to the following agricultural commodities:
(A) Fruits.
(B) Vegetables (other than lentils, mung beans, and
dry peas).

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(C) Wild rice.
(c) EXCEPTIONS.—Paragraphs (1) and (2) of subsection (b) shall
not limit the planting of an agricultural commodity specified in
paragraph (3) of that subsection—
(1) in any region in which there is a history of doublecropping of covered commodities with agricultural commodities
specified in subsection (b)(3), as determined by the Secretary,
in which case the double-cropping shall be permitted;
(2) on a farm that the Secretary determines has a history
of planting agricultural commodities specified in subsection
(b)(3) on base acres, except that direct payments and countercyclical payments shall be reduced by an acre for each acre
planted to such an agricultural commodity; or
(3) by the producers on a farm that the Secretary determines has an established planting history of a specific agricultural commodity specified in subsection (b)(3), except that—
(A) the quantity planted may not exceed the average
annual planting history of such agricultural commodity
by the producers on the farm in the 1991 through 1995
or 1998 through 2001 crop years (excluding any crop year
in which no plantings were made), as determined by the
Secretary; and
(B) direct payments and counter-cyclical payments
shall be reduced by an acre for each acre planted to such
agricultural commodity.
(d) SPECIAL RULE FOR 2002 CROP YEAR.—For the 2002 crop
year only, if the calculation of base acres under section 1101(a)
results in total base acres for a farm in excess of the contract
acreage (as defined in section 102 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7202)) for the
farm used to calculate the fiscal year 2002 payment authorized
under section 114 of such Act (7 U.S.C. 7214), paragraphs (1)
and (2) of subsection (b) shall not limit the harvesting of an agricultural commodity specified in paragraph (3) of that subsection on
the excess base acres, except that direct payments and countercyclical payments for the 2002 crop year shall be reduced by an
acre for each acre of the excess base acres planted to such an
agricultural commodity.
7 USC 7917.

SEC. 1107. RELATION TO REMAINING PAYMENT AUTHORITY UNDER
PRODUCTION FLEXIBILITY CONTRACTS.

(a) TERMINATION OF SUPERSEDED PAYMENT AUTHORITY.—Notwithstanding section 113(a)(7) of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7213(a)(7)) or any other
provision of law, the Secretary shall not make payments for fiscal
year 2002 after the date of enactment of this Act under a production
flexibility contract entered into under section 111 of that Act (7
U.S.C. 7211) unless requested by the producer that is a party
to the contract.
(b) CONTRACT PAYMENTS MADE BEFORE ENACTMENT.—If a producer receives all or any portion of the payment authorized for
fiscal year 2002 under a production flexibility contract, the Secretary shall reduce the amount of the direct payment otherwise
due the producer for the 2002 crop year under section 1103 by
the amount of the fiscal year 2002 payment received by the producer
under the production flexibility contract.

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SEC. 1108. PERIOD OF EFFECTIVENESS.

7 USC 7918.

This subtitle shall be effective beginning with the 2002 crop
year of each covered commodity through the 2007 crop year.

Subtitle B—Marketing Assistance Loans
and Loan Deficiency Payments
SEC. 1201. AVAILABILITY OF NONRECOURSE MARKETING ASSISTANCE
LOANS FOR LOAN COMMODITIES.

7 USC 7931.

(a) NONRECOURSE LOANS AVAILABLE.—
(1) AVAILABILITY.—For each of the 2002 through 2007 crops
of each loan commodity, the Secretary shall make available
to producers on a farm nonrecourse marketing assistance loans
for loan commodities produced on the farm.
(2) TERMS AND CONDITIONS.—The marketing assistance
loans shall be made under terms and conditions that are prescribed by the Secretary and at the loan rate established under
section 1202 for the loan commodity.
(b) ELIGIBLE PRODUCTION.—The producers on a farm shall be
eligible for a marketing assistance loan under subsection (a) for
any quantity of a loan commodity produced on the farm.
(c) TREATMENT OF CERTAIN COMMINGLED COMMODITIES.—In
carrying out this subtitle, the Secretary shall make loans to producers on a farm that would be eligible to obtain a marketing
assistance loan, but for the fact the loan commodity owned by
the producers on the farm commingled with loan commodities of
other producers in facilities unlicensed for the storage of agricultural commodities by the Secretary or a State licensing authority,
if the producers obtaining the loan agree to immediately redeem
the loan collateral in accordance with section 166 of the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7286).
(d) COMPLIANCE WITH CONSERVATION AND WETLANDS REQUIREMENTS.—As a condition of the receipt of a marketing assistance
loan under subsection (a), the producer shall comply with applicable
conservation requirements under subtitle B of title XII of the Food
Security Act of 1985 (16 U.S.C. 3811 et seq.) and applicable wetland
protection requirements under subtitle C of title XII of the Act
(16 U.S.C. 3821 et seq.) during the term of the loan.
(e) TERMINATION OF SUPERSEDED LOAN AUTHORITY.—Notwithstanding section 131 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7231), nonrecourse marketing assistance loans shall not be made for the 2002 crop of loan commodities
under subtitle C of title I of such Act.
SEC. 1202. LOAN RATES FOR NONRECOURSE MARKETING ASSISTANCE
LOANS.

7 USC 7932.

(a) 2002 AND 2003 CROP YEARS.—For purposes of the 2002
and 2003 crop years, the loan rate for a marketing assistance
loan under section 1201 for a loan commodity shall be equal to
the following:
(1) In the case of wheat, $2.80 per bushel.
(2) In the case of corn, $1.98 per bushel.
(3) In the case of grain sorghum, $1.98 per bushel.
(4) In the case of barley, $1.88 per bushel.
(5) In the case of oats, $1.35 per bushel.
(6) In the case of upland cotton, $0.52 per pound.

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(7) In the case of extra long staple cotton, $0.7977 per
pound.
(8) In the case of rice, $6.50 per hundredweight.
(9) In the case of soybeans, $5.00 per bushel.
(10) In the case of other oilseeds, $0.0960 per pound.
(11) In the case of graded wool, $1.00 per pound.
(12) In the case of nongraded wool, $0.40 per pound.
(13) In the case of mohair, $4.20 per pound.
(14) In the case of honey, $0.60 per pound.
(15) In the case of dry peas, $6.33 per hundredweight.
(16) In the case of lentils, $11.94 per hundredweight.
(17) In the case of small chickpeas, $7.56 per hundredweight.
(b) 2004 THROUGH 2007 CROP YEARS.—For purposes of the
2004 through 2007 crop years, the loan rate for a marketing assistance loan under section 1201 for a loan commodity shall be equal
to the following:
(1) In the case of wheat, $2.75 per bushel.
(2) In the case of corn, $1.95 per bushel.
(3) In the case of grain sorghum, $1.95 per bushel.
(4) In the case of barley, $1.85 per bushel.
(5) In the case of oats, $1.33 per bushel.
(6) In the case of upland cotton, $0.52 per pound.
(7) In the case of extra long staple cotton, $0.7977 per
pound.
(8) In the case of rice, $6.50 per hundredweight.
(9) In the case of soybeans, $5.00 per bushel.
(10) In the case of other oilseeds, $0.0930 per pound.
(11) In the case of graded wool, $1.00 per pound.
(12) In the case of nongraded wool, $0.40 per pound.
(13) In the case of mohair, $4.20 per pound.
(14) In the case of honey, $0.60 per pound.
(15) In the case of dry peas, $6.22 per hundredweight.
(16) In the case of lentils, $11.72 per hundredweight.
(17) In the case of small chickpeas, $7.43 per hundredweight.
7 USC 7933.

SEC. 1203. TERM OF LOANS.

(a) TERM OF LOAN.—In the case of each loan commodity, a
marketing assistance loan under section 1201 shall have a term
of 9 months beginning on the first day of the first month after
the month in which the loan is made.
(b) EXTENSIONS PROHIBITED.—The Secretary may not extend
the term of a marketing assistance loan for any loan commodity.
7 USC 7934.

SEC. 1204. REPAYMENT OF LOANS.

(a) GENERAL RULE.—The Secretary shall permit the producers
on a farm to repay a marketing assistance loan under section
1201 for a loan commodity (other than upland cotton, rice, and
extra long staple cotton) at a rate that is the lesser of—
(1) the loan rate established for the commodity under section 1202, plus interest (determined in accordance with section
163 of the Federal Agriculture Improvement and Reform Act
of 1996 (7 U.S.C. 7283)); or
(2) a rate that the Secretary determines will—
(A) minimize potential loan forfeitures;
(B) minimize the accumulation of stocks of the commodity by the Federal Government;

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(C) minimize the cost incurred by the Federal Government in storing the commodity;
(D) allow the commodity produced in the United States
to be marketed freely and competitively, both domestically
and internationally; and
(E) minimize discrepancies in marketing loan benefits
across State boundaries and across county boundaries.
(b) REPAYMENT RATES FOR UPLAND COTTON AND RICE.—The
Secretary shall permit producers to repay a marketing assistance
loan under section 1201 for upland cotton and rice at a rate that
is the lesser of—
(1) the loan rate established for the commodity under section 1202, plus interest (determined in accordance with section
163 of the Federal Agriculture Improvement and Reform Act
of 1996 (7 U.S.C. 7283)); or
(2) the prevailing world market price for the commodity
(adjusted to United States quality and location), as determined
by the Secretary.
(c) REPAYMENT RATES FOR EXTRA LONG STAPLE COTTON.—
Repayment of a marketing assistance loan for extra long staple
cotton shall be at the loan rate established for the commodity
under section 1202, plus interest (determined in accordance with
section 163 of the Federal Agriculture Improvement and Reform
Act of 1996 (7 U.S.C. 7283)).
(d) PREVAILING WORLD MARKET PRICE.—For purposes of this
section and section 1207, the Secretary shall prescribe by
regulation—
(1) a formula to determine the prevailing world market
price for upland cotton and rice, adjusted to United States
quality and location; and
(2) a mechanism by which the Secretary shall announce
periodically the prevailing world market price for upland cotton
and rice.
(e) ADJUSTMENT OF PREVAILING WORLD MARKET PRICE FOR
UPLAND COTTON.—
(1) IN GENERAL.—During the period beginning on the date
of the enactment of this Act through July 31, 2008, the prevailing world market price for upland cotton (adjusted to United
States quality and location) established under subsection (d)
shall be further adjusted if—
(A) the adjusted prevailing world market price is less
than 115 percent of the loan rate for upland cotton established under section 1202, as determined by the Secretary;
and
(B) the Friday through Thursday average price
quotation for the lowest-priced United States growth as
quoted for Middling (M) 13⁄32-inch cotton delivered C.I.F.
Northern Europe is greater than the Friday through Thursday average price of the 5 lowest-priced growths of upland
cotton, as quoted for Middling (M) 13⁄32-inch cotton, delivered C.I.F. Northern Europe (referred to in this section
as the ‘‘Northern Europe price’’).
(2) FURTHER ADJUSTMENT.—Except as provided in paragraph (3), the adjusted prevailing world market price for upland
cotton shall be further adjusted on the basis of some or all
of the following data, as available:
(A) The United States share of world exports.

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(B) The current level of cotton export sales and cotton
export shipments.
(C) Other data determined by the Secretary to be relevant in establishing an accurate prevailing world market
price for upland cotton (adjusted to United States quality
and location).
(3) LIMITATION ON FURTHER ADJUSTMENT.—The adjustment
under paragraph (2) may not exceed the difference between—
(A) the Friday through Thursday average price for
the lowest-priced United States growth as quoted for Middling 13⁄32-inch cotton delivered C.I.F. Northern Europe;
and
(B) the Northern Europe price.
(f) GOOD FAITH EXCEPTION TO BENEFICIAL INTEREST REQUIREMENT.—For the 2001 crop year only, in the case of the producers
on a farm that marketed or otherwise lost beneficial interest in
a loan commodity for which a marketing assistance loan was made
under section 131 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7231) before repaying the loan, the
Secretary shall permit the producers to repay the loan at the
appropriate repayment rate that was in effect for the loan commodity under section 134 of that Act (7 U.S.C. 7234) on the date
that the producers lost beneficial interest, as determined by the
Secretary, if the Secretary determines the producers acted in good
faith.
7 USC 7935.

SEC. 1205. LOAN DEFICIENCY PAYMENTS.

(a) AVAILABILITY OF LOAN DEFICIENCY PAYMENTS.—
(1) IN GENERAL.—Except as provided in subsection (d), the
Secretary may make loan deficiency payments available to producers on a farm that, although eligible to obtain a marketing
assistance loan under section 1201 with respect to a loan commodity, agree to forgo obtaining the loan for the commodity
in return for loan deficiency payments under this section.
(2) UNSHORN PELTS, HAY, AND SILAGE.—Nongraded wool
in the form of unshorn pelts and hay and silage derived from
a loan commodity are not eligible for a marketing assistance
loan under section 1201. However, effective for the 2002
through 2007 crop years, the Secretary may make loan deficiency payments available under this section to producers on
a farm that produce unshorn pelts or hay and silage derived
from a loan commodity.
(b) COMPUTATION.—A loan deficiency payment for a loan commodity or commodity referred to in subsection (a)(2) shall be computed by multiplying—
(1) the payment rate determined under subsection (c) for
the commodity; by
(2) the quantity of the commodity produced by the eligible
producers, excluding any quantity for which the producers
obtain a marketing assistance loan under section 1201.
(c) PAYMENT RATE.—
(1) IN GENERAL.—In the case of a loan commodity, the
payment rate shall be the amount by which—
(A) the loan rate established under section 1202 for
the loan commodity; exceeds
(B) the rate at which a marketing assistance loan
for the loan commodity may be repaid under section 1204.

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(2) UNSHORN PELTS.—In the case of unshorn pelts, the
payment rate shall be the amount by which—
(A) the loan rate established under section 1202 for
ungraded wool; exceeds
(B) the rate at which a marketing assistance loan
for ungraded wool may be repaid under section 1204.
(3) HAY AND SILAGE.—In the case of hay or silage derived
from a loan commodity, the payment rate shall be the amount
by which—
(A) the loan rate established under section 1202 for
the loan commodity from which the hay or silage is derived;
exceeds
(B) the rate at which a marketing assistance loan
for the loan commodity may be repaid under section 1204.
(d) EXCEPTION FOR EXTRA LONG STAPLE COTTON.—This section
shall not apply with respect to extra long staple cotton.
(e) EFFECTIVE DATE FOR PAYMENT RATE DETERMINATION.—The
Secretary shall determine the amount of the loan deficiency payment to be made under this section to the producers on a farm
with respect to a quantity of a loan commodity or commodity
referred to in subsection (a)(2) using the payment rate in effect
under subsection (c) as of the date the producers request the payment.
(f) SPECIAL LOAN DEFICIENCY PAYMENT RULES.—
(1) FIRST-TIME LOAN COMMODITIES.—For the 2002 crop of
wool, mohair, honey, dry peas, lentils and small chickpeas,
in the case of producers of such a crop that would be eligible
for a loan deficiency payment under this section except for
the fact that the producers lost beneficial interest in the crop
prior to the date of publication of the regulations implementing
this section, the producers shall be eligible for a loan deficiency
payment as of the date producers marketed or otherwise lost
beneficial interest in the crop, as determined by the Secretary.
(2) 2001 CROP YEAR.—Section 135 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7235) is
amended—
(A) in subsection (a)(2), by striking ‘‘2000 crop year’’
and inserting ‘‘2000 and 2001 crop years’’; and
(B) by adding at the end the following:
‘‘(g) EFFECTIVE DATE FOR PAYMENT RATE DETERMINATION.—
For the 2001 crop year, the Secretary shall determine the amount
of the loan deficiency payment to be made under this section to
the producers on a farm with respect to a quantity of a loan
commodity using the payment rate in effect under subsection (c)
as of the earlier of the following:
‘‘(1) The date on which the producers marketed or otherwise
lost beneficial interest in the crop of the loan commodity, as
determined by the Secretary.
‘‘(2) The date the producers requested the payment.’’.
SEC. 1206. PAYMENTS IN LIEU OF LOAN DEFICIENCY PAYMENTS FOR
GRAZED ACREAGE.

7 USC 7936.

(a) ELIGIBLE PRODUCERS.—
(1) IN GENERAL.—Effective for the 2002 through 2007 crop
years, in the case of a producer that would be eligible for
a loan deficiency payment under section 1205 for wheat, barley,
or oats, but that elects to use acreage planted to the wheat,

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barley, or oats for the grazing of livestock, the Secretary shall
make a payment to the producer under this section if the
producer enters into an agreement with the Secretary to forgo
any other harvesting of the wheat, barley, or oats on that
acreage.
(2) GRAZING OF TRITICALE ACREAGE.—Effective for the 2002
through 2007 crop years, with respect to a producer on a
farm that uses acreage planted to triticale for the grazing
of livestock, the Secretary shall make a payment to the producer
under this section if the producer enters into an agreement
with the Secretary to forgo any other harvesting of triticale
on that acreage.
(b) PAYMENT AMOUNT.—
(1) IN GENERAL.—The amount of a payment made under
this section to a producer on a farm described in subsection
(a)(1) shall be equal to the amount determined by multiplying—
(A) the loan deficiency payment rate determined under
section 1205(c) in effect, as of the date of the agreement,
for the county in which the farm is located; by
(B) the payment quantity determined by multiplying—
(i) the quantity of the grazed acreage on the farm
with respect to which the producer elects to forgo harvesting of wheat, barley, or oats; and
(ii) the payment yield in effect for the calculation
of direct payments under subtitle A with respect to
that loan commodity on the farm or, in the case of
a farm without a payment yield for that loan commodity, an appropriate yield established by the Secretary in a manner consistent with section 1102(c).
(2) GRAZING OF TRITICALE ACREAGE.—The amount of a payment made under this section to a producer on a farm described
in subsection (a)(2) shall be equal to the amount determined
by multiplying—
(A) the loan deficiency payment rate determined under
section 1205(c) in effect for wheat, as of the date of the
agreement, for the county in which the farm is located;
by
(B) the payment quantity determined by multiplying—
(i) the quantity of the grazed acreage on the farm
with respect to which the producer elects to forgo harvesting of triticale; and
(ii) the payment yield in effect for the calculation
of direct payments under subtitle A with respect to
wheat on the farm or, in the case of a farm without
a payment yield for wheat, an appropriate yield established by the Secretary in a manner consistent with
section 1102(c).
(c) TIME, MANNER, AND AVAILABILITY OF PAYMENT.—
(1) TIME AND MANNER.—A payment under this section shall
be made at the same time and in the same manner as loan
deficiency payments are made under section 1205.
(2) AVAILABILITY.—The Secretary shall establish an availability period for the payments authorized by this section.
In the case of wheat, barley, and oats, the availability period
shall be consistent with the availability period for the commodity established by the Secretary for marketing assistance
loans authorized by this subtitle.

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(d) PROHIBITION ON CROP INSURANCE INDEMNITY OR NONCROP ASSISTANCE.—A 2002 through 2007 crop of wheat,
barley, oats, or triticale planted on acreage that a producer elects,
in the agreement required by subsection (a), to use for the grazing
of livestock in lieu of any other harvesting of the crop shall not
be eligible for an indemnity under the Federal Crop Insurance
Act (7 U.S.C. 1501 et seq.) or noninsured crop assistance under
section 196 of the Federal Agriculture Improvement and Reform
Act of 1996 (7 U.S.C. 7333).
INSURED

SEC. 1207. SPECIAL MARKETING LOAN PROVISIONS FOR UPLAND
COTTON.

7 USC 7937.

(a) COTTON USER MARKETING CERTIFICATES.—
(1) ISSUANCE.—During the period beginning on the date
of the enactment of this Act through July 31, 2008, the Secretary shall issue marketing certificates or cash payments,
at the option of the recipient, to domestic users and exporters
for documented purchases by domestic users and sales for
export by exporters made in the week following a consecutive
4-week period in which—
(A) the Friday through Thursday average price
quotation for the lowest-priced United States growth, as
quoted for Middling (M) 13⁄32-inch cotton, delivered C.I.F.
Northern Europe exceeds the Northern Europe price by
more than 1.25 cents per pound; and
(B) the prevailing world market price for upland cotton
(adjusted to United States quality and location) does not
exceed 134 percent of the loan rate for upland cotton established under section 1202.
(2) VALUE OF CERTIFICATES OR PAYMENTS.—The value of
the marketing certificates or cash payments shall be based
on the amount of the difference (reduced by 1.25 cents per
pound) in the prices during the fourth week of the consecutive
4-week period multiplied by the quantity of upland cotton
included in the documented sales.
(3) ADMINISTRATION OF MARKETING CERTIFICATES.—
(A) REDEMPTION, MARKETING, OR EXCHANGE.—The Secretary shall establish procedures for redeeming marketing
certificates for cash or marketing or exchange of the certificates for agricultural commodities owned by the Commodity
Credit Corporation or pledged to the Commodity Credit
Corporation as collateral for a loan in such manner, and
at such price levels, as the Secretary determines will best
effectuate the purposes of cotton user marketing certificates, including enhancing the competitiveness and marketability of United States cotton. Any price restrictions that
would otherwise apply to the disposition of agricultural
commodities by the Commodity Credit Corporation shall
not apply to the redemption of certificates under this subsection.
(B) DESIGNATION OF COMMODITIES AND PRODUCTS.—
To the extent practicable, the Secretary shall permit owners
of certificates to designate the commodities and products,
including storage sites, the owners would prefer to receive
in exchange for certificates
(C) TRANSFERS.—Marketing certificates issued to
domestic users and exporters of upland cotton may be

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transferred to other persons in accordance with regulations
issued by the Secretary.
(4) DELAYED APPLICATION OF THRESHOLD.—Through July
31, 2006, the Secretary shall make the calculations under paragraphs (1)(A) and (2) without regard to the 1.25 cent threshold
provided under those paragraphs.
(b) SPECIAL IMPORT QUOTA.—
(1) ESTABLISHMENT.—
(A) IN GENERAL.—The President shall carry out an
import quota program during the period beginning on the
date of the enactment of this Act through July 31, 2008,
as provided in this subsection.
(B) PROGRAM REQUIREMENTS.—Except as provided in
subparagraph (C), whenever the Secretary determines and
announces that for any consecutive 4-week period, the Friday through Thursday average price quotation for the
lowest-priced United States growth, as quoted for Middling
(M) 13⁄32-inch cotton, delivered C.I.F. Northern Europe,
adjusted for the value of any certificate issued under subsection (a), exceeds the Northern Europe price by more
than 1.25 cents per pound, there shall immediately be
in effect a special import quota.
(C) TIGHT DOMESTIC SUPPLY.—During any month for
which the Secretary estimates the season-ending United
States upland cotton stocks-to-use ratio, as determined
under subparagraph (D), to be below 16 percent, the Secretary, in making the determination under subparagraph
(B), shall not adjust the Friday through Thursday average
price quotation for the lowest-priced United States growth,
as quoted for Middling (M) 13⁄32-inch cotton, delivered C.I.F.
Northern Europe, for the value of any certificates issued
under subsection (a).
(D) SEASON-ENDING UNITED STATES STOCKS-TO-USE
RATIO.—For the purposes of making estimates under
subparagraph (C), the Secretary shall, on a monthly basis,
estimate and report the season-ending United States
upland cotton stocks-to-use ratio, excluding projected raw
cotton imports but including the quantity of raw cotton
that has been imported into the United States during the
marketing year.
(E) DELAYED APPLICATION OF THRESHOLD.—Through
July 31, 2006, the Secretary shall make the calculation
under subparagraph (B) without regard to the 1.25 cent
threshold provided under that subparagraph.
(2) QUANTITY.—The quota shall be equal to one week’s
consumption of upland cotton by domestic mills at the seasonally adjusted average rate of the most recent three months
for which data are available.
(3) APPLICATION.—The quota shall apply to upland cotton
purchased not later than 90 days after the date of the Secretary’s announcement under paragraph (1) and entered into
the United States not later than 180 days after the date.
(4) OVERLAP.—A special quota period may be established
that overlaps any existing quota period if required by paragraph
(1), except that a special quota period may not be established
under this subsection if a quota period has been established
under subsection (c).

Deadlines.

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(5) PREFERENTIAL TARIFF TREATMENT.—The quantity under
a special import quota shall be considered to be an in-quota
quantity for purposes of—
(A) section 213(d) of the Caribbean Basin Economic
Recovery Act (19 U.S.C. 2703(d));
(B) section 204 of the Andean Trade Preference Act
(19 U.S.C. 3203);
(C) section 503(d) of the Trade Act of 1974 (19 U.S.C.
2463(d)); and
(D) General Note 3(a)(iv) to the Harmonized Tariff
Schedule.
(6) DEFINITION.—In this subsection, the term ‘‘special
import quota’’ means a quantity of imports that is not subject
to the over-quota tariff rate of a tariff-rate quota.
(7) LIMITATION.—The quantity of cotton entered into the
United States during any marketing year under the special
import quota established under this subsection may not exceed
the equivalent of 5 week’s consumption of upland cotton by
domestic mills at the seasonally adjusted average rate of the
3 months immediately preceding the first special import quota
established in any marketing year.
(c) LIMITED GLOBAL IMPORT QUOTA FOR UPLAND COTTON.—
(1) IN GENERAL.—The President shall carry out an import
quota program that provides that whenever the Secretary determines and announces that the average price of the base quality
of upland cotton, as determined by the Secretary, in the designated spot markets for a month exceeded 130 percent of
the average price of such quality of cotton in the markets
for the preceding 36 months, notwithstanding any other provision of law, there shall immediately be in effect a limited
global import quota subject to the following conditions:
(A) QUANTITY.—The quantity of the quota shall be
equal to 21 days of domestic mill consumption of upland
cotton at the seasonally adjusted average rate of the most
recent 3 months for which data are available.
(B) QUANTITY IF PRIOR QUOTA.—If a quota has been
established under this subsection during the preceding 12
months, the quantity of the quota next established under
this subsection shall be the smaller of 21 days of domestic
mill consumption calculated under subparagraph (A) or
the quantity required to increase the supply to 130 percent
of the demand.
(C) PREFERENTIAL TARIFF TREATMENT.—The quantity
under a limited global import quota shall be considered
to be an in-quota quantity for purposes of—
(i) section 213(d) of the Caribbean Basin Economic
Recovery Act (19 U.S.C. 2703(d));
(ii) section 204 of the Andean Trade Preference
Act (19 U.S.C. 3203);
(iii) section 503(d) of the Trade Act of 1974 (19
U.S.C. 2463(d)); and
(iv) General Note 3(a)(iv) to the Harmonized Tariff
Schedule.
(D) DEFINITIONS.—In this subsection:
(i) SUPPLY.—The term ‘‘supply’’ means, using the
latest official data of the Bureau of the Census, the

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PUBLIC LAW 107–171—MAY 13, 2002
Department of Agriculture, and the Department of the
Treasury—
(I) the carry-over of upland cotton at the beginning of the marketing year (adjusted to 480-pound
bales) in which the quota is established;
(II) production of the current crop; and
(III) imports to the latest date available during
the marketing year.
(ii) DEMAND.—The term ‘‘demand’’ means—
(I) the average seasonally adjusted annual rate
of domestic mill consumption during the most
recent 3 months for which data are available; and
(II) the larger of—
(aa) average exports of upland cotton
during the preceding 6 marketing years; or
(bb) cumulative exports of upland cotton
plus outstanding export sales for the marketing year in which the quota is established.
(iii) LIMITED GLOBAL IMPORT QUOTA.—The term
‘‘limited global import quota’’ means a quantity of
imports that is not subject to the over-quota tariff
rate of a tariff-rate quota.
(E) QUOTA ENTRY PERIOD.—When a quota is established under this subsection, cotton may be entered under
the quota during the 90-day period beginning on the date
the quota is established by the Secretary.
(2) NO OVERLAP.—Notwithstanding paragraph (1), a quota
period may not be established that overlaps an existing quota
period or a special quota period established under subsection
(b).

7 USC 7938.

SEC. 1208. SPECIAL COMPETITIVE PROVISIONS FOR EXTRA LONG
STAPLE COTTON.

(a) COMPETITIVENESS PROGRAM.—Notwithstanding any other
provision of law, during the period beginning on the date of the
enactment of this Act through July 31, 2008, the Secretary shall
carry out a program—
(1) to maintain and expand the domestic use of extra long
staple cotton produced in the United States;
(2) to increase exports of extra long staple cotton produced
in the United States; and
(3) to ensure that extra long staple cotton produced in
the United States remains competitive in world markets.
(b) PAYMENTS UNDER PROGRAM; TRIGGER.—Under the program,
the Secretary shall make payments available under this section
whenever—
(1) for a consecutive 4-week period, the world market price
for the lowest priced competing growth of extra long staple
cotton (adjusted to United States quality and location and
for other factors affecting the competitiveness of such cotton),
as determined by the Secretary, is below the prevailing United
States price for a competing growth of extra long staple cotton;
and
(2) the lowest priced competing growth of extra long staple
cotton (adjusted to United States quality and location and
for other factors affecting the competitiveness of such cotton),

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as determined by the Secretary, is less than 134 percent of
the loan rate for extra long staple cotton.
(c) ELIGIBLE RECIPIENTS.—The Secretary shall make payments
available under this section to domestic users of extra long staple
cotton produced in the United States and exporters of extra long
staple cotton produced in the United States that enter into an
agreement with the Commodity Credit Corporation to participate
in the program under this section.
(d) PAYMENT AMOUNT.—Payments under this section shall be
based on the amount of the difference in the prices referred to
in subsection (b)(1) during the fourth week of the consecutive 4week period multiplied by the amount of documented purchases
by domestic users and sales for export by exporters made in the
week following such a consecutive 4-week period.
(e) FORM OF PAYMENT.—Payments under this section shall be
made through the issuance of cash or marketing certificates, at
the option of eligible recipients of the payments.
SEC. 1209. AVAILABILITY OF RECOURSE LOANS FOR HIGH MOISTURE
FEED GRAINS AND SEED COTTON.

7 USC 7939.

(a) HIGH MOISTURE FEED GRAINS.—
(1) RECOURSE LOANS AVAILABLE.—For each of the 2002
through 2007 crops of corn and grain sorghum, the Secretary
shall make available recourse loans, as determined by the
Secretary, to producers on a farm that—
(A) normally harvest all or a portion of their crop
of corn or grain sorghum in a high moisture state;
(B) present—
(i) certified scale tickets from an inspected, certified commercial scale, including a licensed warehouse,
feedlot, feed mill, distillery, or other similar entity
approved by the Secretary, pursuant to regulations
issued by the Secretary; or
(ii) field or other physical measurements of the
standing or stored crop in regions of the United States,
as determined by the Secretary, that do not have certified commercial scales from which certified scale
tickets may be obtained within reasonable proximity
of harvest operation;
(C) certify that they were the owners of the feed grain
at the time of delivery to, and that the quantity to be
placed under loan under this subsection was in fact harvested on the farm and delivered to, a feedlot, feed mill,
or commercial or on-farm high-moisture storage facility,
or to a facility maintained by the users of corn and grain
sorghum in a high moisture state; and
(D) comply with deadlines established by the Secretary
for harvesting the corn or grain sorghum and submit
applications for loans under this subsection within deadlines established by the Secretary.
(2) ELIGIBILITY OF ACQUIRED FEED GRAINS.—A loan under
this subsection shall be made on a quantity of corn or grain
sorghum of the same crop acquired by the producer equivalent
to a quantity determined by multiplying—
(A) the acreage of the corn or grain sorghum in a
high moisture state harvested on the producer’s farm; by

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(B) the lower of the farm program payment yield used
to make counter-cyclical payments under subtitle A or the
actual yield on a field, as determined by the Secretary,
that is similar to the field from which the corn or grain
sorghum was obtained.
(3) HIGH MOISTURE STATE DEFINED.—In this subsection,
the term ‘‘high moisture state’’ means corn or grain sorghum
having a moisture content in excess of Commodity Credit Corporation standards for marketing assistance loans made by
the Secretary under section 1201.
(b) RECOURSE LOANS AVAILABLE FOR SEED COTTON.—For each
of the 2002 through 2007 crops of upland cotton and extra long
staple cotton, the Secretary shall make available recourse seed
cotton loans, as determined by the Secretary, on any production.
(c) REPAYMENT RATES.—Repayment of a recourse loan made
under this section shall be at the loan rate established for the
commodity by the Secretary, plus interest (determined in accordance
with section 163 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7283)).
(d) TERMINATION OF SUPERSEDED LOAN AUTHORITY.—Notwithstanding section 137 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7237), recourse loans shall not be
made for the 2002 crop of corn, grain sorghum, and seed cotton
under such section.

Subtitle C—Peanuts
7 USC 7951.

SEC. 1301. DEFINITIONS.

In this subtitle:
(1) BASE ACRES FOR PEANUTS.—The term ‘‘base acres for
peanuts’’ means the number of acres assigned to a farm by
historic peanut producers pursuant to section 1302(b).
(2) COUNTER-CYCLICAL PAYMENT.—The term ‘‘countercyclical payment’’ means a payment made under section 1304.
(3) EFFECTIVE PRICE.—The term ‘‘effective price’’ means
the price calculated by the Secretary under section 1304 for
peanuts to determine whether counter-cyclical payments are
required to be made under that section for a crop year.
(4) DIRECT PAYMENT.—The term ‘‘direct payment’’ means
a payment made under section 1303.
(5) HISTORIC PEANUT PRODUCER.—The term ‘‘historic peanut producer’’ means a producer on a farm in the United
States that produced or was prevented from planting peanuts
during any or all of the 1998 through 2001 crop years.
(6) PAYMENT ACRES.—The term ‘‘payment acres’’ means—
(A) for the 2002 crop of peanuts, 85 percent of the
average acreage determined under section 1302(a)(2) for
an historic peanut producer; and
(B) for the 2003 through 2007 crops of peanuts, 85
percent of the base acres for peanuts assigned to a farm
under section 1302(b).
(7) PAYMENT YIELD.—The term ‘‘payment yield’’ means the
yield assigned to a farm by historic peanut producers pursuant
to section 1302(b).
(8) PRODUCER.—The term ‘‘producer’’ means an owner,
operator, landlord, tenant, or sharecropper that shares in the

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risk of producing a crop on a farm and is entitled to share
in the crop available for marketing from the farm, or would
have shared had the crop been produced. In determining
whether a grower of hybrid seed is a producer, the Secretary
shall not take into consideration the existence of a hybrid
seed contract and shall ensure that program requirements do
not adversely affect the ability of the grower to receive a payment under this subtitle.
(9) SECRETARY.—The term ‘‘Secretary’’ means the Secretary
of Agriculture.
(10) STATE.—The term ‘‘State’’ means each of the several
States of the United States, the District of Columbia, the
Commonwealth of Puerto Rico, and any other territory or
possession of the United States.
(11) TARGET PRICE.—The term ‘‘target price’’ means the
price per ton of peanuts used to determine the payment rate
for counter-cyclical payments.
(12) UNITED STATES.—The term ‘‘United States’’, when used
in a geographical sense, means all of the States.
SEC. 1302. ESTABLISHMENT OF PAYMENT YIELD AND BASE ACRES
FOR PEANUTS FOR A FARM.
NUT

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7 USC 7952.

(a) AVERAGE YIELD AND ACREAGE AVERAGE FOR HISTORIC PEAPRODUCERS.—
(1) DETERMINATION OF AVERAGE YIELD.—
(A) IN GENERAL.—The Secretary shall determine, for
each historic peanut producer, the average yield for peanuts
on each farm on which the historic peanut producer planted
peanuts for harvest for the 1998 through 2001 crop years,
excluding any crop year in which the producer did not
plant or was prevented from planting peanuts.
(B) ASSIGNED YIELDS.—For the purposes of determining
the 4-year average yield for an historic peanut producer
under this paragraph, the historic peanut producer may
elect to substitute for a farm, for not more than 3 of
the 1998 through 2001 crop years in which the producer
planted peanuts on the farm, the average yield for peanuts
produced in the county in which the farm is located for
the 1990 through 1997 crop years.
(2) DETERMINATION OF ACREAGE AVERAGE.—
(A) IN GENERAL.—The Secretary shall determine, for
each historic peanut producer, the 4-year average of the
following:
(i) Acreage planted to peanuts on each farm on
which the historic peanut producer planted peanuts
for harvest for the 1998 through 2001 crop years.
(ii) Any acreage on each farm that the historic
peanut producer was prevented from planting to peanuts during the 1998 through 2001 crop years because
of drought, flood, or other natural disaster, or other
condition beyond the control of the historic peanut
producer, as determined by the Secretary.
(B) INCLUSION OF ALL 4 YEARS IN AVERAGE.—For the
purposes of determining the 4-year acreage average for
an historic peanut producer under this paragraph, the Secretary shall not exclude any crop year in which the producer did not plant peanuts.

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(C) PROPORTIONAL SHARES.—If more than 1 historic
peanut producer shared in the risk of producing the crop
on a farm, the historic peanut producers shall receive their
proportional share of the number of acres planted (or prevented from being planted) to peanuts for harvest on the
farm based on the sharing arrangement that was in effect
among the producers for the crop.
(3) TIME FOR DETERMINATIONS.—The Secretary shall make
the determinations required by this subsection as soon as practicable after the date of enactment of this Act.
(4) SPECIAL CONSIDERATIONS.—In making the determinations required by this subsection, the Secretary shall take into
account changes in the number, identity, or interest of producers sharing in the risk of producing a peanut crop since
the 1998 crop year, including providing a method for the assignment of average acres and average yield to a farm—
(A) when an historic peanut producer is no longer
living;
(B) when an entity composed of historic peanut producers has been dissolved; or
(C) in other appropriate situations, as determined by
the Secretary.
(b) ASSIGNMENT OF AVERAGE YIELDS AND AVERAGE ACREAGE
TO FARMS.—
(1) ASSIGNMENT BY HISTORIC PEANUT PRODUCERS.—The Secretary shall give each historic peanut producer an opportunity
to assign the average peanut yield and average acreage determined under subsection (a) for each farm of the historic peanut
producer to cropland on that farm or another farm in the
same State or a contiguous State.
(2) LIMITATION ON ACREAGE ASSIGNMENT.—Notwithstanding paragraph (1), the average acreage determined under
subsection (a)(2) for a farm may not be assigned to a farm
in a contiguous State unless—
(A) the historic peanut producer making the assignment produced peanuts in that State during at least 1
of the 1998 through 2001 crop years; or
(B) as of March 31, 2003, the historic peanut producer
is a producer on a farm in that State.
(3) NOTICE OF ASSIGNMENT OPPORTUNITY.—The Secretary
shall provide notice to historic peanut producers regarding their
opportunity to assign average peanut yields and average acreages to farms under paragraph (1). The notice shall include
the following:
(A) Notice that the opportunity to make the assignments is being provided only once.
(B) A description of the limitation in paragraph (2)
on their ability to make the assignments.
(C) Information regarding the manner in which the
assignments must be made and the time periods and
manner in which notice of the assignments must be submitted to the Secretary.
(4) ASSIGNMENT DEADLINES.—Not later than March 31,
2003, an historic peanut producer shall submit to the Secretary
notice of the assignments made by the producer under this
subsection. If an historic peanut producer fails to submit the

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notice by that date, the notice shall be submitted in such
other manner as the Secretary may prescribe.
(c) PAYMENT YIELD.—The average of all of the yields assigned
by historic peanut producers under subsection (b) to a farm shall
be considered to be the payment yield for that farm for the purpose
of making direct payments and counter-cyclical payments under
this subtitle.
(d) BASE ACRES FOR PEANUTS.—Subject to subsection (e), the
total number of acres assigned by historic peanut producers under
subsection (b) to a farm shall be considered to be the farm’s base
acres for peanuts for the purpose of making direct payments and
counter-cyclical payments under this subtitle.
(e) TREATMENT OF CONSERVATION RESERVE CONTRACT ACREAGE.—
(1) IN GENERAL.—The Secretary shall provide for an adjustment, as appropriate, in the base acres for peanuts for a farm
whenever either of the following circumstances occur:
(A) A conservation reserve contract entered into under
section 1231 of the Food Security Act of 1985 (16 U.S.C.
3831) with respect to the farm expires or is voluntarily
terminated.
(B) Cropland is released from coverage under a conservation reserve contract by the Secretary.
(2) SPECIAL PAYMENT RULES.—For the crop year in which
a base acres for peanuts adjustment under paragraph (1) is
first made, the owner of the farm shall elect to receive either
direct payments and counter-cyclical payments with respect
to the acreage added to the farm under this subsection or
a prorated payment under the conservation reserve contract,
but not both.
(f) PREVENTION OF EXCESS BASE ACRES FOR PEANUTS.—
(1) REQUIRED REDUCTION.—If the sum of the base acres
for peanuts for a farm, together with the acreage described
in paragraph (2), exceeds the actual cropland acreage of the
farm, the Secretary shall reduce the base acres for peanuts
for the farm or the base acres for 1 or more covered commodities
under subtitle A for the farm so that the sum of the base
acres for peanuts and acreage described in paragraph (2) does
not exceed the actual cropland acreage of the farm.
(2) OTHER ACREAGE.—For purposes of paragraph (1), the
Secretary shall include the following:
(A) Any base acres for the farm under subtitle A.
(B) Any acreage on the farm enrolled in the conservation reserve program or wetlands reserve program under
chapter 1 of subtitle D of title XII of the Food Security
Act of 1985 (16 U.S.C. 3830 et seq.).
(C) Any other acreage on the farm enrolled in a conservation program for which payments are made in
exchange for not producing an agricultural commodity on
the acreage.
(3) SELECTION OF ACRES.—The Secretary shall give the
owner of the farm the opportunity to select the base acres
for peanuts or the subtitle A base acres against which the
reduction required by paragraph (1) will be made.
(4) EXCEPTION FOR DOUBLE-CROPPED ACREAGE.—In
applying paragraph (1), the Secretary shall make an exception
in the case of double cropping, as determined by the Secretary.

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(5) COORDINATED APPLICATION OF REQUIREMENTS.—The
Secretary shall take into account section 1101(g) when applying
the requirements of this subsection.
(g) PERMANENT REDUCTION IN BASE ACRES FOR PEANUTS.—
The owner of a farm may reduce, at any time, the base acres
for peanuts assigned to the farm. The reduction shall be permanent
and made in the manner prescribed by the Secretary.
7 USC 7953.

Deadline.

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SEC. 1303. AVAILABILITY OF DIRECT PAYMENTS FOR PEANUTS.

(a) PAYMENT REQUIRED.—
(1) 2002 CROP YEAR.—For the 2002 crop year, the Secretary
shall make direct payments under this section to historic peanut
producers.
(2) SUBSEQUENT CROP YEARS.—For each of the 2003 through
2007 crop years for peanuts, the Secretary shall make direct
payments to the producers on a farm to which a payment
yield and base acres for peanuts are assigned under section
1302.
(b) PAYMENT RATE.—The payment rate used to make direct
payments with respect to peanuts for a crop year shall be equal
to $36 per ton.
(c) PAYMENT AMOUNT FOR 2002 CROP YEAR.—The amount of
the direct payment to be paid to an historic peanut producer for
the 2002 crop of peanuts shall be equal to the product of the
following:
(1) The payment rate specified in subsection (b).
(2) The payment acres of the historic peanut producer.
(3) The average peanut yield determined under section
1302(a)(1) for the historic peanut producer.
(d) PAYMENT AMOUNT FOR SUBSEQUENT CROP YEARS.—The
amount of the direct payment to be paid to the producers on
a farm for the 2003 through 2007 crops of peanuts shall be equal
to the product of the following:
(1) The payment rate specified in subsection (b).
(2) The payment acres on the farm.
(3) The payment yield for the farm.
(e) TIME FOR PAYMENT.—
(1) IN GENERAL.—The Secretary shall make direct
payments—
(A) in the case of the 2002 crop year, as soon as
practicable after the date of enactment of this Act; and
(B) in the case of each of the 2003 through 2007
crop years, not later than September 30 of the calendar
year in which the crop is harvested.
(2) ADVANCE PAYMENTS.—At the option of the producers
on a farm, up to 50 percent of the direct payment for any
of the 2003 through 2007 crop years shall be paid to the
producers in advance. The producers shall select the month
within which the advance payment for a crop year will be
made. The month selected may be any month during the period
beginning on December 1 of the calendar year before the calendar year in which the crop is harvested through the month
within which the direct payment would otherwise be made.
The producers may change the selected month for a subsequent
advance payment by providing advance notice to the Secretary.
(3) REPAYMENT OF ADVANCE PAYMENTS.—If a producer on
a farm that receives an advance direct payment for a crop

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year ceases to be a producer on that farm, or the extent to
which the producer shares in the risk of producing a crop
changes, before the date the remainder of the direct payment
is made, the producer shall be responsible for repaying the
Secretary the applicable amount of the advance payment, as
determined by the Secretary.
SEC. 1304. AVAILABILITY OF COUNTER-CYCLICAL PAYMENTS FOR PEANUTS.

7 USC 7954.

(a) PAYMENT REQUIRED.—
(1) IN GENERAL.—During the 2002 through 2007 crop years
for peanuts, the Secretary shall make counter-cyclical payments
under this section with respect to peanuts if the Secretary
determines that the effective price for peanuts is less than
the target price for peanuts.
(2) 2002 CROP YEAR.—If counter-cyclical payments are
required for the 2002 crop year, the Secretary shall make
the payments to historic peanut producers.
(3) SUBSEQUENT CROP YEARS.—If counter-cyclical payments
are required for any of the 2003 through 2007 crop years
for peanuts, the Secretary shall make the payments to the
producers on a farm to which a payment yield and base acres
for peanuts are assigned under section 1302.
(b) EFFECTIVE PRICE.—For purposes of subsection (a), the effective price for peanuts is equal to the sum of the following:
(1) The higher of the following:
(A) The national average market price for peanuts
received by producers during the 12-month marketing year
for peanuts, as determined by the Secretary.
(B) The national average loan rate for a marketing
assistance loan for peanuts in effect for the applicable
period under this subtitle.
(2) The payment rate in effect under section 1303 for the
purpose of making direct payments.
(c) TARGET PRICE.—For purposes of subsection (a), the target
price for peanuts shall be equal to $495 per ton.
(d) PAYMENT RATE.—The payment rate used to make countercyclical payments for a crop year shall be equal to the difference
between—
(1) the target price; and
(2) the effective price determined under subsection (b).
(e) PAYMENT AMOUNT FOR 2002 CROP YEAR.—If counter-cyclical
payments are required to be paid for the 2002 crop of peanuts,
the amount of the counter-cyclical payment to be paid to an historic
peanut producer for that crop year shall be equal to the product
of the following:
(1) The payment rate specified in subsection (d).
(2) The payment acres of the historic peanut producer.
(3) The average peanut yield determined under section
1302(a)(1) for the historic peanut producer.
(f) PAYMENT AMOUNT FOR SUBSEQUENT CROP YEARS.—If
counter-cyclical payments are required to be paid for any of the
2003 through 2007 crops of peanuts, the amount of the countercyclical payment to be paid to the producers on a farm for that
crop year shall be equal to the product of the following:
(1) The payment rate specified in subsection (d).
(2) The payment acres on the farm.

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PUBLIC LAW 107–171—MAY 13, 2002
(3) The payment yield for the farm.
(g) TIME FOR PAYMENTS.—
(1) GENERAL RULE.—If the Secretary determines under subsection (a) that counter-cyclical payments are required to be
made under this section for a crop year, the Secretary shall
make the counter-cyclical payments as soon as practicable after
the end of the 12-month marketing year for the crop.
(2) AVAILABILITY OF PARTIAL PAYMENTS.—If, before the end
of the 12-month marketing year, the Secretary estimates that
counter-cyclical payments will be required under this section
for a crop year, the Secretary shall give producers on a farm
(or, in the case of the 2002 crop year, historic peanut producers)
the option to receive partial payments of the counter-cyclical
payment projected to be made for that crop.
(3) TIME FOR PARTIAL PAYMENTS.—
(A) 2002 THROUGH 2006 CROP YEARS.—When the Secretary makes partial payments available under paragraph
(2) for any of the 2002 through 2006 crop years—
(i) the first partial payment for the crop year shall
be made not earlier than October 1, and, to the maximum extent practicable, not later than October 31,
of the calendar year in which the crop is harvested;
(ii) the second partial payment shall be made not
earlier than February 1 of the next calendar year;
and
(iii) the final partial payment shall be made as
soon as practicable after the end of the 12-month marketing year for that crop.
(B) 2007 CROP YEAR.—When the Secretary makes partial payments available for the 2007 crop year—
(i) the first partial payment shall be made after
completion of the first 6 months of the marketing year
for that crop; and
(ii) the final partial payment shall be made as
soon as practicable after the end of the 12-month marketing year for that crop.
(4) AMOUNT OF PARTIAL PAYMENTS.—
(A) 2002 CROP YEAR.—
(i) FIRST PARTIAL PAYMENT.—In the case of the
2002 crop year, the first partial payment under paragraph (3) to an historic peanut producer may not
exceed 35 percent of the projected counter-cyclical payment for the crop year, as determined by the Secretary.
(ii) SECOND PARTIAL PAYMENT.—The second partial
payment may not exceed the difference between—
(I) 70 percent of the projected counter-cyclical
payment (including any revision thereof) for the
2002 crop year; and
(II) the amount of the payment made under
clause (i).
(iii) FINAL PAYMENT.—The final payment shall be
equal to the difference between—
(I) the actual counter-cyclical payment to be
made to the historic peanut producer; and
(II) the amount of the partial payments made
to the historic peanut producer under clauses (i)
and (ii).

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(B) 2003 THROUGH 2006 CROP YEARS.—
(i) FIRST PARTIAL PAYMENT.—For each of the 2003
through 2006 crop years, the first partial payment
under paragraph (3) to the producers on a farm may
not exceed 35 percent of the projected counter-cyclical
payment for the crop year, as determined by the Secretary.
(ii) SECOND PARTIAL PAYMENT.—The second partial
payment for a crop year may not exceed the difference
between—
(I) 70 percent of the projected counter-cyclical
payment (including any revision thereof) for the
crop year; and
(II) the amount of the payment made under
clause (i).
(iii) FINAL PAYMENT.—The final payment for a crop
year shall be equal to the difference between—
(I) the actual counter-cyclical payment to be
made to the producers for that crop year; and
(II) the amount of the partial payments made
to the producers under clauses (i) and (ii) for that
crop year.
(C) 2007 CROP YEAR.—
(i) FIRST PARTIAL PAYMENT.—For the 2007 crop
year, the first partial payment under paragraph (3)
to the producers on a farm may not exceed 40 percent
of the projected counter-cyclical payment for the crop
year, as determined by the Secretary.
(ii) FINAL PAYMENT.—The final payment for the
2007 crop year shall be equal to the difference
between—
(I) the actual counter-cyclical payment to be
made to the producers for that crop year; and
(II) the amount of the partial payment made
to the producers under clause (i).
(5) REPAYMENT.—The producers on a farm (or, in the case
of the 2002 crop year, historic peanut producers) that receive
a partial payment under this subsection for a crop year shall
repay to the Secretary the amount, if any, by which the total
of the partial payments exceed the actual counter-cyclical payment to be made for that crop year.
SEC. 1305. PRODUCER AGREEMENT REQUIRED AS CONDITION ON
PROVISION OF DIRECT PAYMENTS AND COUNTERCYCLICAL PAYMENTS.

7 USC 7955.

(a) COMPLIANCE WITH CERTAIN REQUIREMENTS.—
(1) REQUIREMENTS.—Before the producers on a farm may
receive direct payments or counter-cyclical payments under this
subtitle with respect to the farm, the producers shall agree,
during the crop year for which the payments are made and
in exchange for the payments—
(A) to comply with applicable conservation requirements under subtitle B of title XII of the Food Security
Act of 1985 (16 U.S.C. 3811 et seq.);
(B) to comply with applicable wetland protection
requirements under subtitle C of title XII of that Act (16
U.S.C. 3821 et seq.);

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(C) to comply with the planting flexibility requirements
of section 1306;
(D) to use the land on the farm, in a quantity equal
to the attributable base acres for peanuts and any base
acres for the farm under subtitle A, for an agricultural
or conserving use, and not for a nonagricultural commercial
or industrial use, as determined by the Secretary; and
(E) to effectively control noxious weeds and otherwise
maintain the land in accordance with sound agricultural
practices, as determined by the Secretary, if the agricultural or conserving use involves the noncultivation of any
portion of the land referred to in subparagraph (D).
(2) COMPLIANCE.—The Secretary may issue such rules as
the Secretary considers necessary to ensure producer compliance with the requirements of paragraph (1).
(3) MODIFICATION.—At the request of the transferee or
owner, the Secretary may modify the requirements of this subsection if the modifications are consistent with the objectives
of this subsection, as determined by the Secretary.
(b) TRANSFER OR CHANGE OF INTEREST IN FARM.—
(1) TERMINATION.—Except as provided in paragraph (2),
a transfer of (or change in) the interest of the producers on
a farm in the base acres for peanuts for which direct payments
or counter-cyclical payments are made shall result in the termination of the payments with respect to those acres, unless
the transferee or owner of the acreage agrees to assume all
obligations under subsection (a). The termination shall take
effect on the date determined by the Secretary.
(2) EXCEPTION.—If a producer entitled to a direct payment
or counter-cyclical payment dies, becomes incompetent, or is
otherwise unable to receive the payment, the Secretary shall
make the payment, in accordance with rules issued by the
Secretary.
(c) ACREAGE REPORTS.—As a condition on the receipt of direct
payments, counter-cyclical payments, marketing assistance loans,
or loan deficiency payments under this subtitle, the Secretary shall
require the producers on a farm to which a payment yield and
base acres for peanuts are assigned under section 1302 to submit
to the Secretary annual acreage reports with respect to all cropland
on the farm.
(d) TENANTS AND SHARECROPPERS.—In carrying out this subtitle, the Secretary shall provide adequate safeguards to protect
the interests of tenants and sharecroppers.
(e) SHARING OF PAYMENTS.—The Secretary shall provide for
the sharing of direct payments and counter-cyclical payments among
the producers on a farm on a fair and equitable basis.
7 USC 7956.

SEC. 1306. PLANTING FLEXIBILITY.

(a) PERMITTED CROPS.—Subject to subsection (b), any commodity or crop may be planted on the base acres for peanuts
on a farm.
(b) LIMITATIONS REGARDING CERTAIN COMMODITIES.—
(1) GENERAL LIMITATION.—The planting of an agricultural
commodity specified in paragraph (2) shall be prohibited on
base acres for peanuts unless the commodity, if planted, is
destroyed before harvest.

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(2) TREATMENT OF TREES AND OTHER PERENNIALS.—The
planting of an agricultural commodity specified in paragraph
(3) that is produced on a tree or other perennial plant shall
be prohibited on base acres for peanuts.
(3) COVERED AGRICULTURAL COMMODITIES.—Paragraphs (1)
and (2) apply to the following agricultural commodities:
(A) Fruits.
(B) Vegetables (other than lentils, mung beans, and
dry peas).
(C) Wild rice.
(c) EXCEPTIONS.—Paragraphs (1) and (2) of subsection (b) shall
not limit the planting of an agricultural commodity specified in
paragraph (3) of that subsection—
(1) in any region in which there is a history of doublecropping of peanuts with agricultural commodities specified
in subsection (b)(3), as determined by the Secretary, in which
case the double-cropping shall be permitted;
(2) on a farm that the Secretary determines has a history
of planting agricultural commodities specified in subsection
(b)(3) on the base acres for peanuts, except that direct payments
and counter-cyclical payments shall be reduced by an acre
for each acre planted to such an agricultural commodity; or
(3) by the producers on a farm that the Secretary determines has an established planting history of a specific agricultural commodity specified in subsection (b)(3), except that—
(A) the quantity planted may not exceed the average
annual planting history of such agricultural commodity
by the producers on the farm in the 1991 through 1995
or 1998 through 2001 crop years (excluding any crop year
in which no plantings were made), as determined by the
Secretary; and
(B) direct payments and counter-cyclical payments
shall be reduced by an acre for each acre planted to such
agricultural commodity.
SEC. 1307. MARKETING ASSISTANCE LOANS AND LOAN DEFICIENCY
PAYMENTS FOR PEANUTS.

7 USC 7957.

(a) NONRECOURSE LOANS AVAILABLE.—
(1) AVAILABILITY.—For each of the 2002 through 2007 crops
of peanuts, the Secretary shall make available to producers
on a farm nonrecourse marketing assistance loans for peanuts
produced on the farm. The loans shall be made under terms
and conditions that are prescribed by the Secretary and at
the loan rate established under subsection (b).
(2) ELIGIBLE PRODUCTION.—The producers on a farm shall
be eligible for a marketing assistance loan under this subsection
for any quantity of peanuts produced on the farm.
(3) TREATMENT OF CERTAIN COMMINGLED COMMODITIES.—
In carrying out this subsection, the Secretary shall make loans
to producers on a farm that would be eligible to obtain a
marketing assistance loan, but for the fact the peanuts owned
by the producers on the farm are commingled with other peanuts in facilities unlicensed for the storage of agricultural
commodities by the Secretary or a State licensing authority,
if the producers obtaining the loan agree to immediately redeem
the loan collateral in accordance with section 166 of the Federal

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Agriculture Improvement and Reform Act of 1996 (7 U.S.C.
7286).
(4) OPTIONS FOR OBTAINING LOAN.—A marketing assistance
loan under this subsection, and loan deficiency payments under
subsection (e), may be obtained at the option of the producers
on a farm through—
(A) a designated marketing association or marketing
cooperative of producers that is approved by the Secretary;
or
(B) the Farm Service Agency.
(5) STORAGE OF LOAN PEANUTS.—As a condition on the
Secretary’s approval of an individual or entity to provide storage
for peanuts for which a marketing assistance loan is made
under this section, the individual or entity shall agree—
(A) to provide such storage on a nondiscriminatory
basis; and
(B) to comply with such additional requirements as
the Secretary considers appropriate to accomplish the purposes of this section and promote fairness in the administration of the benefits of this section.
(6) PAYMENT OF PEANUT STORAGE COSTS.—Effective for the
2002 through 2006 crops of peanuts, to ensure proper storage
of peanuts for which a loan is made under this section, the
Secretary shall use the funds of the Commodity Credit Corporation to pay storage, handling, and other associated costs. This
authority terminates beginning with the 2007 crop of peanuts.
(7) MARKETING.—A marketing association or cooperative
may market peanuts for which a loan is made under this
section in any manner that conforms to consumer needs,
including the separation of peanuts by type and quality.
(b) LOAN RATE.—The loan rate for a marketing assistance loan
under for peanuts subsection (a) shall be equal to $355 per ton.
(c) TERM OF LOAN.—
(1) IN GENERAL.—A marketing assistance loan for peanuts
under subsection (a) shall have a term of 9 months beginning
on the first day of the first month after the month in which
the loan is made.
(2) EXTENSIONS PROHIBITED.—The Secretary may not
extend the term of a marketing assistance loan for peanuts
under subsection (a).
(d) REPAYMENT RATE.—
(1) IN GENERAL.—The Secretary shall permit producers on
a farm to repay a marketing assistance loan for peanuts under
subsection (a) at a rate that is the lesser of—
(A) the loan rate established for peanuts under subsection (b), plus interest (determined in accordance with
section 163 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7283)); or
(B) a rate that the Secretary determines will—
(i) minimize potential loan forfeitures;
(ii) minimize the accumulation of stocks of peanuts
by the Federal Government;
(iii) minimize the cost incurred by the Federal
Government in storing peanuts; and
(iv) allow peanuts produced in the United States
to be marketed freely and competitively, both domestically and internationally.

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(2) GOOD FAITH EXCEPTION TO BENEFICIAL INTEREST
REQUIREMENT.—For the 2002 crop year only, in the case of
the producers on a farm that marketed or otherwise lost beneficial interest in the peanuts for which a marketing assistance
loan was made under this section before repaying the loan,
the Secretary shall permit the producers to repay the loan
at the applicable repayment rate that was in effect for peanuts
under this subsection on the date that the producers lost beneficial interest, as determined by the Secretary, if the Secretary
determines the producers acted in good faith.
(e) LOAN DEFICIENCY PAYMENTS.—
(1) AVAILABILITY.—The Secretary may make loan deficiency
payments available to producers on a farm that, although
eligible to obtain a marketing assistance loan for peanuts under
subsection (a), agree to forgo obtaining the loan for the peanuts
in return for loan deficiency payments under this subsection.
(2) COMPUTATION.—A loan deficiency payment under this
subsection shall be computed by multiplying—
(A) the payment rate determined under paragraph (3)
for peanuts; by
(B) the quantity of the peanuts produced by the producers, excluding any quantity for which the producers
obtain a marketing assistance loan under subsection (a).
(3) PAYMENT RATE.—For purposes of this subsection, the
payment rate shall be the amount by which—
(A) the loan rate established under subsection (b);
exceeds
(B) the rate at which a loan may be repaid under
subsection (d).
(4) EFFECTIVE DATE FOR PAYMENT RATE DETERMINATION.—
(A) IN GENERAL.—The Secretary shall determine the
amount of the loan deficiency payment to be made under
this subsection to the producers on a farm with respect
to a quantity of peanuts using the payment rate in effect
under paragraph (3) as of the date the producers request
the payment.
(B) SPECIAL RULE FOR 2002 CROP YEAR.—For the 2002
crop year only, the Secretary shall determine the amount
of the loan deficiency payment to be made under this
subsection to the producers on a farm with respect to
a quantity of peanuts using the payment rate in effect
under paragraph (3) as of the earlier of the following:
(i) The date on which the producers marketed or
otherwise lost beneficial interest in the crop, as determined by the Secretary.
(ii) The date the producers request the payment.
(f) COMPLIANCE WITH CONSERVATION AND WETLANDS REQUIREMENTS.—As a condition of the receipt of a marketing assistance
loan under subsection (a), the producer shall comply with applicable
conservation requirements under subtitle B of title XII of the Food
Security Act of 1985 (16 U.S.C. 3811 et seq.) and applicable wetland
protection requirements under subtitle C of title XII of that Act
(16 U.S.C. 3821 et seq.) during the term of the loan.
(g) REIMBURSABLE AGREEMENTS AND PAYMENT OF ADMINISTRATIVE EXPENSES.—The Secretary may implement any reimbursable
agreements or provide for the payment of administrative expenses

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under this subtitle only in a manner that is consistent with such
activities in regard to other commodities.
7 USC 7958.

SEC. 1308. MISCELLANEOUS PROVISIONS.

(a) MANDATORY INSPECTION.—All peanuts marketed in the
United States shall be officially inspected and graded by Federal
or Federal-State inspectors.
(b) TERMINATION OF PEANUT ADMINISTRATIVE COMMITTEE.—
The Peanut Administrative Committee established under Marketing
Agreement No. 146 issued pursuant to the Agricultural Adjustment
Act (7 U.S.C. 601 et seq.), reenacted with amendments by the
Agricultural Marketing Agreement Act of 1937, is terminated.
(c) PEANUT STANDARDS BOARD.—
(1) ESTABLISHMENT AND PURPOSE.—The Secretary shall
establish a Peanut Standards Board for the purpose of advising
the Secretary regarding the establishment of quality and handling standards for domestically produced and imported peanuts.
(2) MEMBERSHIP AND APPOINTMENT.—
(A) TOTAL MEMBERS.—The Board shall consist of 18
members, with representation equally divided between peanut producers and peanut industry representatives.
(B) APPOINTMENT PROCESS FOR PRODUCERS.—The Secretary shall appoint—
(i) 3 producers from the Southeast (Alabama,
Georgia, and Florida) peanut producing region;
(ii) 3 producers from the Southwest (Texas, Oklahoma, and New Mexico) peanut producing region; and
(iii) 3 producers from the Virginia/Carolina (Virginia and North Carolina) peanut producing region.
(C) APPOINTMENT PROCESS FOR INDUSTRY REPRESENTATIVES.—The Secretary shall appoint 3 peanut industry representatives from each of the 3 peanut producing regions
in the United States.
(3) TERMS.—
(A) IN GENERAL.—A member of the Board shall serve
a 3-year term.
(B) INITIAL APPOINTMENT.—In making the initial
appointments to the Board, the Secretary shall stagger
the terms of the members so that—
(i) 1 producer member and peanut industry
member from each peanut producing region serves a
1-year term;
(ii) 1 producer member and peanut industry
member from each peanut producing region serves a
2-year term; and
(iii) 1 producer member and peanut industry
member from each peanut producing region serves a
3-year term.
(4) CONSULTATION REQUIRED.—The Secretary shall consult
with the Board in advance whenever the Secretary establishes
or changes, or considers the establishment of or a change to,
quality and handling standards for peanuts.
(5) FEDERAL ADVISORY COMMITTEE ACT.—The Federal
Advisory Committee Act (5 U.S.C. App.) shall not apply to
the Board.

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(d) PRIORITY.—The Secretary shall make identifying and combating the presence of all quality concerns related to peanuts a
priority in the development of quality and handling standards for
peanuts and in the inspection of domestically produced and
imported peanuts. The Secretary shall consult with appropriate
Federal and State agencies to provide adequate safeguards against
all quality concerns related to peanuts.
(e) CONSISTENT STANDARDS.—Imported peanuts shall be subject
to the same quality and handling standards as apply to domestically
produced peanuts.
(f) AUTHORIZATION OF APPROPRIATIONS.—
(1) IN GENERAL.—In addition to other funds that are available to carry out this section, there is authorized to be appropriated such sums as are necessary to carry out this section.
(2) TREATMENT OF BOARD EXPENSES.—The expenses of the
Peanut Standards Board shall not be counted toward any general limitation on the expenses of advisory committees, panels,
commissions, and task forces of the Department of Agriculture,
whether enacted before, on, or after the date of enactment
of this Act, unless the limitation specifically refers to this
paragraph and specifically includes the Peanut Standards
Board within the general limitation.
(g) TRANSITION RULE.—
(1) TEMPORARY DESIGNATION OF PEANUT ADMINISTRATIVE
the appointment
COMMITTEE
MEMBERS.—Notwithstanding
process specified in subsection (c) for the Peanut Standards
Board, during the transition period, the Secretary may designate persons serving as members of the Peanut Administrative Committee on the day before the date of enactment of
this Act to serve as members of the Peanut Standards Board
for the purpose of carrying out the duties of the Board described
in this section.
(2) FUNDS.—The Secretary may transfer any funds available to carry out the activities of the Peanut Administrative
Committee to the Peanut Standards Board to carry out the
duties of the Board described in this section.
(3) TRANSITION PERIOD.—In paragraph (1), the term ‘‘transition period’’ means the period beginning on the date of enactment of this Act and ending on the earlier of—
(A) the date the Secretary appoints the members of
the Peanut Standards Board pursuant to subsection (c);
or
(B) 180 days after the date of enactment of this Act.
(h) EFFECTIVE DATE.—This section shall take effect with the
2002 crop of peanuts.
SEC. 1309. TERMINATION OF MARKETING QUOTA PROGRAMS FOR PEANUTS AND COMPENSATION TO PEANUT QUOTA HOLDERS
FOR LOSS OF QUOTA ASSET VALUE.

7 USC 7959.

(a) REPEAL OF MARKETING QUOTA.—
(1) REPEAL.—Part VI of subtitle B of title III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1357–1359a), relating
to peanuts, is repealed.
(2) TREATMENT OF 2001 CROP.—Part VI of subtitle B of
title III of the Agricultural Adjustment Act of 1938 (7 U.S.C.
1357–1359a), as in effect on the day before the date of enactment of this Act, shall continue to apply with respect to the

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PUBLIC LAW 107–171—MAY 13, 2002

2001 crop of peanuts notwithstanding the amendment made
by paragraph (1). Section 1308(g)(2) shall also apply to the
2001 crop of peanuts.
(b) COMPENSATION CONTRACT REQUIRED.—
(1) IN GENERAL.—The Secretary shall offer to enter into
a contract with each person that the Secretary determines
is an eligible peanut quota holder under subsection (f) for
the purpose of providing compensation for the lost value of
the quota on account of the repeal of the marketing quota
program for peanuts under subsection (a).
(2) PAYMENT PERIOD.—The Secretary shall make payments
under the contracts during fiscal years 2002 through 2006.
(c) TIME FOR PAYMENT.—
(1) PAYMENT IN INSTALLMENTS.—The payments required
under the contracts shall be provided in 5 equal installments
not later than September 30 of each of fiscal years 2002 through
2006.
(2) SINGLE PAYMENT.—At the request of an eligible peanut
quota holder entitled to payments under a contract, the Secretary shall provide the entire payment amount determined
under subsection (d) with respect to the eligible peanut quota
holder for the 5 fiscal years in a single lump sum during
the fiscal year specified by the eligible peanut quota holder.
(d) PAYMENT AMOUNT.—The amount of the payment for a fiscal
year to an eligible peanut quota holder under a contract shall
be equal to the product obtained by multiplying—
(1) $0.11 per pound; by
(2) the number of pounds of quota with respect to which
the person qualifies as a peanut quota holder under subsection
(f).
(e) ASSIGNMENT OF PAYMENTS.—The provisions of section 8(g)
of the Soil Conservation and Domestic Allotment Act (16 U.S.C.
590h(g)), relating to assignment of payments, shall apply to the
payments made under the contracts. A person making an assignment of the payment, or the assignee, shall provide the Secretary
with notice, in such manner as the Secretary may require, of
any assignment made under this subsection.
(f) ELIGIBLE PEANUT QUOTA HOLDER.—
(1) IN GENERAL.—Except as otherwise provided in this subsection, the Secretary shall consider a person to be an eligible
peanut quota holder for the purposes of this section if the
person, as of the date of enactment of this Act, owned a farm
that, also as of that date, was eligible for a permanent peanut
quota under section 358–1(b) of the Agricultural Adjustment
Act of 1938 (7 U.S.C. 1358–1(b)), irrespective of temporary
leases, transfers of quotas for seed, or quotas for experimental
purposes.
(2) EFFECT OF PURCHASE CONTRACT.—If there was a written
contract for the purchase of all or a portion of a farm described
in paragraph (1) as of the date of enactment of this Act and
the parties to the sale are unable to agree to the disposition
of eligibility for payments under this section, the Secretary,
taking into account any incomplete permanent transfer of quota
that has otherwise been agreed to, shall provide for the equitable division of the payments among the parties by adjusting
the determination of who is the eligible peanut quota holder
with respect to particular pounds of the quota.

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PUBLIC LAW 107–171—MAY 13, 2002
(3) EFFECT OF AGREEMENT FOR PERMANENT
TRANSFER.—If the Secretary determines that there was

116 STAT. 181
QUOTA

in existence, as of the date of enactment of this Act, an agreement
for the permanent transfer of quota, but that the transfer
was not completed by that date, the Secretary shall consider
the peanut quota holder to be the party to the agreement
who, as of that date, was the owner of the farm to which
the quota was to be transferred.
(4) PROTECTED BASES.—A person that owns a farm with
a peanut poundage quota which is protected under a conservation reserve program contract entered into under section 1231
of the Food Security Act of 1985 (16 U.S.C. 3831) shall be
considered to be an eligible quota holder with respect to the
protected poundage.
(5) SECRETARIAL DISCRETION.—Notwithstanding the preceding paragraphs, the Secretary may declare a person to be
the eligible peanut quota holder with respect to certain pounds
of quota or otherwise for purposes of this section if the Secretary
considers the declaration is needed to insure a fair and equitable administration of the payments provided for in this section, so long as the Secretary does not, in exercising this
authority, effectively increase the total quota in excess of the
quota that was available to all producers for the 2001 crop
year for other than seed or experimental use.
(6) LIMITATION ON QUANTITY OF QUOTA HELD.—A person
shall be considered an eligible peanut quota holder for purposes
of this section only with respect to that number of permanent
pounds that qualifies the person as a peanut quota holder
under one of the preceding paragraphs. The determination of
the peanut poundage amount for which the person qualifies
shall be made based on the 2001 crop quota levels and shall
take into account sales of the farm that occurred before the
date of enactment of this Act and any permanent transfers
of quota that took place before that date, consistent with the
preceding paragraphs. The Secretary shall not take into
account, or allow eligibility for, quotas for seed, granted as
experimental quotas, or obtained by temporary lease or
transfer.
(g) SUCCESSIONS IN PAYMENT ELIGIBILITY AND ATTACHMENT
OF ELIGIBILITY TO PERSONS.—
(1) ELIGIBILITY ATTACHES TO PERSONS.—Once a person is
eligible for payments under this section, as determined under
subsection (f), the continued eligibility of the person for the
payments does not run with a farm, but shall remain with
the person for the term of this section irrespective of whether
the person sells, or continues to have an interest in, the farm
that had the quota that qualified the person as an eligible
peanut quota holder under subsection (f) and irrespective of
whether the person has a continuing interest in the production
of peanuts.
(2) SUCCESSION.—If a person eligible for payments under
this section dies, in the case of an individual, or ceases to
exist, in the case of other persons, the payment eligibility
of the person shall pass to the person’s personal or organizational successor, as determined by the Secretary.
(h) CONFORMING AMENDMENTS.—

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116 STAT. 182

PUBLIC LAW 107–171—MAY 13, 2002
(1) ADMINISTRATIVE PROVISIONS.—Section 361 of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1361) is amended
by striking ‘‘peanuts,’’.
(2) ADJUSTMENT OF QUOTAS.—Section 371 of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1371) is amended—
(A) in the first sentence of subsection (a), by striking
‘‘peanuts,’’; and
(B) in the first sentence of subsection (b), by striking
‘‘peanuts’’.
(3) REPORTS AND RECORDS.—Section 373 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1373) is amended—
(A) in the first sentence of subsection (a)—
(i) by striking ‘‘peanuts,’’ each place it appears;
(ii) by inserting ‘‘and’’ after ‘‘from producers,’’; and
(iii) by striking ‘‘for producers, all’’ and all that
follows through the period at the end of the sentence
and inserting ‘‘for producers.’’; and
(B) in subsection (b), by striking ‘‘peanuts,’’.
(4) EMINENT DOMAIN.—Section 378(c) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1378(c)) is amended in the
first sentence—
(A) by striking ‘‘cotton,’’ and inserting ‘‘cotton and’’;
and
(B) by striking ‘‘and peanuts,’’.

7 USC 7960.

SEC. 1310. REPEAL OF SUPERSEDED PRICE SUPPORT AUTHORITY AND
EFFECT OF REPEAL.

(a) REPEAL OF PRICE SUPPORT AUTHORITY.—
(1) IN GENERAL.—Section 155 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7271) is
repealed.
(2) CONFORMING AMENDMENTS.—The Agricultural Act of
1949 (7 U.S.C. 1441 et seq.) is amended—
(A) in section 101(b) (7 U.S.C. 1441(b)), by striking
‘‘and peanuts’’; and
(B) in section 408(c) (7 U.S.C. 1428(c)), by striking
‘‘peanuts,’’.
(3) TECHNICAL AMENDMENT.—The chapter heading of
chapter 2 of subtitle D of the Federal Agriculture Improvement
and Reform Act of 1996 (7 U.S.C. prec. 7271) is amended
by striking ‘‘PEANUTS AND’’.
(b) DISPOSAL.—Notwithstanding any other provision of law or
previous declaration made by the Secretary, the Secretary shall
ensure that the disposal of all peanuts for which a loan for the
2001 crop of peanuts was made under section 155 of the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7271)
before the date of enactment of this Act is carried out in a manner
that prevents price disruptions in the domestic and international
markets for peanuts.
(c) TREATMENT OF CROP INSURANCE POLICIES FOR 2002 CROP
YEAR.—
(1) APPLICABILITY.—This subsection shall apply for the
2002 crop year only notwithstanding any other provision of
law or crop insurance policy.
(2) PRICE ELECTION.—The nonquota price election for segregation I, II, and III peanuts shall be 17.75 cents per pound

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116 STAT. 183

and shall be used for all aspects of the policy relating to
the calculations of premium, liability, and indemnities.
(3) QUALITY ADJUSTMENT.—For the purposes of quality
adjustment only, the average support price per pound of peanuts shall be a price equal to 17.75 cents per pound. Quality
under the crop insurance policy for peanuts shall be adjusted
under procedures issued by the Federal Crop Insurance Corporation.

Subtitle D—Sugar
SEC. 1401. SUGAR PROGRAM.

(a) EXTENSION AND MODIFICATION OF EXISTING SUGAR PROGRAM.—Section 156 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7272) is amended to read as follows:
‘‘SEC. 156. SUGAR PROGRAM.

‘‘(a) SUGARCANE.—The Secretary shall make loans available
to processors of domestically grown sugarcane at a rate equal to
18 cents per pound for raw cane sugar.
‘‘(b) SUGAR BEETS.—The Secretary shall make loans available
to processors of domestically grown sugar beets at a rate equal
to 22.9 cents per pound for refined beet sugar.
‘‘(c) LOAN RATE ADJUSTMENTS.—
‘‘(1) IN GENERAL.—The Secretary may reduce the loan rate
specified in subsection (a) for domestically grown sugarcane
and subsection (b) for domestically grown sugar beets if the
Secretary determines that negotiated reductions in export subsidies and domestic subsidies provided for sugar of other major
sugar growing, producing, and exporting countries in the aggregate exceed the commitments made as part of the Agreement
on Agriculture.
‘‘(2) EXTENT OF REDUCTION.—The Secretary shall not reduce
the loan rate under subsection (a) or (b) below a rate that
provides an equal measure of support to that provided by
other major sugar growing, producing, and exporting countries,
based on an examination of both domestic and export subsidies
subject to reduction in the Agreement on Agriculture.
‘‘(3) ANNOUNCEMENT OF REDUCTION.—The Secretary shall
announce any loan rate reduction to be made under this subsection as far in advance as is practicable.
‘‘(4) DEFINITIONS.—In this subsection:
‘‘(A) AGREEMENT ON AGRICULTURE.—The term ‘‘Agreement on Agriculture’’ means the Agreement on Agriculture
referred to in section 101(d)(2) of the Uruguay Round
Agreements Act (19 U.S.C. 3511(d)(2)), or any amendatory
or successor agreement.
‘‘(B) MAJOR SUGAR COUNTRIES.—The term ‘‘major sugar
growing, producing, and exporting countries’’ means—
‘‘(i) the countries of the European Union; and
‘‘(ii) the 10 foreign countries not covered by
subparagraph (A) that the Secretary determines
produce the greatest quantity of sugar.
‘‘(d) TERM OF LOANS.—

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116 STAT. 184

PUBLIC LAW 107–171—MAY 13, 2002
‘‘(1) IN GENERAL.—A loan under this section during any
fiscal year shall be made available not earlier than the beginning of the fiscal year and shall mature at the earlier of—
‘‘(A) the end of the 9-month period beginning on the
first day of the first month after the month in which
the loan is made; or
‘‘(B) the end of the fiscal year in which the loan is
made.
‘‘(2) SUPPLEMENTAL LOANS.—In the case of a loan made
under this section in the last 3 months of a fiscal year, the
processor may repledge the sugar as collateral for a second
loan in the subsequent fiscal year, except that the second
loan shall—
‘‘(A) be made at the loan rate in effect at the time
the second loan is made; and
‘‘(B) mature in 9 months less the quantity of time
that the first loan was in effect.
‘‘(e) LOAN TYPE; PROCESSOR ASSURANCES.—
‘‘(1) NONRECOURSE LOANS.—The Secretary shall carry out
this section through the use of nonrecourse loans.
‘‘(2) PROCESSOR ASSURANCES.—
‘‘(A) IN GENERAL.—The Secretary shall obtain from
each processor that receives a loan under this section such
assurances as the Secretary considers adequate to ensure
that the processor will provide payments to producers that
are proportional to the value of the loan received by the
processor for the sugar beets and sugarcane delivered by
producers to the processor.
‘‘(B) MINIMUM PAYMENTS.—
‘‘(i) IN GENERAL.—Subject to clause (ii), the Secretary may establish appropriate minimum payments
for purposes of this paragraph.
‘‘(ii) LIMITATION.—In the case of sugar beets, the
minimum payment established under clause (i) shall
not exceed the rate of payment provided for under
the applicable contract between a sugar beet producer
and a sugar beet processor.
‘‘(iii) EFFECT OF DISASTER.—The Secretary may not
bar a beet sugar processor from eligibility to obtain
a loan under this section because of the failure of
the processor to provide the appropriate minimum payment established under this subsection if the failure—
‘‘(I) occurred during a crop year prior to the
date of enactment of the Farm Security and Rural
Investment Act of 2002; and
‘‘(II) was related, at least in part, to the effects
of a natural disaster, including damage from
freeze.
‘‘(3) ADMINISTRATION.—The Secretary may not impose or
enforce any prenotification requirement, or similar administrative requirement not otherwise in effect on the date of enactment of the Farm Security and Rural Investment Act of 2002,
that has the effect of preventing a processor from electing
to forfeit the loan collateral (of an acceptable grade and quality)
on the maturity of the loan.
‘‘(f) LOANS FOR IN-PROCESS SUGAR.—

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116 STAT. 185

‘‘(1) DEFINITION OF IN-PROCESS SUGARS AND SYRUPS.—In
this subsection, the term ‘in-process sugars and syrups’ does
not include raw sugar, liquid sugar, invert sugar, invert syrup,
or other finished product that is otherwise eligible for a loan
under subsection (a) or (b).
‘‘(2) AVAILABILITY.—The Secretary shall make nonrecourse
loans available to processors of a crop of domestically grown
sugarcane and sugar beets for in-process sugars and syrups
derived from the crop.
‘‘(3) LOAN RATE.—The loan rate shall be equal to 80 percent
of the loan rate applicable to raw cane sugar or refined beet
sugar, as determined by the Secretary on the basis of the
source material for the in-process sugars and syrups.
‘‘(4) FURTHER PROCESSING ON FORFEITURE.—
‘‘(A) IN GENERAL.—As a condition of the forfeiture of
in-process sugars and syrups serving as collateral for a
loan under paragraph (2), the processor shall, within such
reasonable time period as the Secretary may prescribe
and at no cost to the Commodity Credit Corporation, convert the in-process sugars and syrups into raw cane sugar
or refined beet sugar of acceptable grade and quality for
sugars eligible for loans under subsection (a) or (b).
‘‘(B) TRANSFER TO CORPORATION.—Once the in-process
sugars and syrups are fully processed into raw cane sugar
or refined beet sugar, the processor shall transfer the sugar
to the Commodity Credit Corporation.
‘‘(C) PAYMENT TO PROCESSOR.—On transfer of the
sugar, the Secretary shall make a payment to the processor
in an amount equal to the amount obtained by
multiplying—
‘‘(i) the difference between—
‘‘(I) the loan rate for raw cane sugar or refined
beet sugar, as appropriate; and
‘‘(II) the loan rate the processor received under
paragraph (3); by
‘‘(ii) the quantity of sugar transferred to the Secretary.
‘‘(5) LOAN CONVERSION.—If the processor does not forfeit
the collateral as described in paragraph (4), but instead further
processes the in-process sugars and syrups into raw cane sugar
or refined beet sugar and repays the loan on the in-process
sugars and syrups, the processor may obtain a loan under
subsection (a) or (b) for the raw cane sugar or refined beet
sugar, as appropriate.
‘‘(6) TERM OF LOAN.—The term of a loan made under this
subsection for a quantity of in-process sugars and syrups, when
combined with the term of a loan made with respect to the
raw cane sugar or refined beet sugar derived from the inprocess sugars and syrups, may not exceed 9 months, consistent
with subsection (d).
‘‘(g) AVOIDING FORFEITURES; CORPORATION INVENTORY DISPOSITION.—
‘‘(1) IN GENERAL.—Subject to subsection (e)(3), to the maximum extent practicable, the Secretary shall operate the program established under this section at no cost to the Federal
Government by avoiding the forfeiture of sugar to the Commodity Credit Corporation.

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(2) INVENTORY DISPOSITION.—
‘‘(A) IN GENERAL.—To carry out paragraph (1), the
Commodity Credit Corporation may accept bids to obtain
raw cane sugar or refined beet sugar in the inventory
of the Commodity Credit Corporation from (or otherwise
make available such commodities, on appropriate terms
and conditions, to) processors of sugarcane and processors
of sugar beets (acting in conjunction with the producers
of the sugarcane or sugar beets processed by the processors)
in return for the reduction of production of raw cane sugar
or refined beet sugar, as appropriate.
‘‘(B) ADDITIONAL AUTHORITY.—The authority provided
under this paragraph is in addition to any authority of
the Commodity Credit Corporation under any other law.
‘‘(h) INFORMATION REPORTING.—
‘‘(1) DUTY OF PROCESSORS AND REFINERS TO REPORT.—A
sugarcane processor, cane sugar refiner, and sugar beet processor shall furnish the Secretary, on a monthly basis, such
information as the Secretary may require to administer sugar
programs, including the quantity of purchases of sugarcane,
sugar beets, and sugar, and production, importation, distribution, and stock levels of sugar.
‘‘(2) DUTY OF PRODUCERS TO REPORT.—
‘‘(A) PROPORTIONATE SHARE STATES.—As a condition
of a loan made to a processor for the benefit of a producer,
the Secretary shall require each producer of sugarcane
located in a State (other than the Commonwealth of Puerto
Rico) in which there are in excess of 250 producers of
sugarcane to report, in the manner prescribed by the Secretary, the sugarcane yields and acres planted to sugarcane
of the producer.
‘‘(B) OTHER STATES.—The Secretary may require each
producer of sugarcane or sugar beets not covered by
subparagraph (A) to report, in a manner prescribed by
the Secretary, the yields of, and acres planted to, sugarcane
or sugar beets, respectively, of the producer.
‘‘(3) DUTY OF IMPORTERS TO REPORT.—
‘‘(A) IN GENERAL.—Except as provided in subparagraph
(B), the Secretary shall require an importer of sugars,
syrups, or molasses to be used for human consumption
or to be used for the extraction of sugar for human
consumption to report, in the manner prescribed by the
Secretary, the quantities of the products imported by the
importer and the sugar content or equivalent of the products.
‘‘(B) TARIFF-RATE QUOTAS.—Subparagraph (A) shall not
apply to sugars, syrups, or molasses that are within the
quantities of tariff-rate quotas that are subject to the lower
rate of duties.
‘‘(4) PENALTY.—Any person willfully failing or refusing to
furnish the information, or furnishing willfully any false
information, shall be subject to a civil penalty of not more
than $10,000 for each such violation.
‘‘(5) MONTHLY REPORTS.—Taking into consideration the
information received under this subsection, the Secretary shall
publish on a monthly basis composite data on production,
imports, distribution, and stock levels of sugar.

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‘‘(i) SUBSTITUTION OF REFINED SUGAR.—For purposes of Additional U.S. Note 6 to chapter 17 of the Harmonized Tariff Schedule
of the United States and the reexport programs and polyhydric
alcohol program administered by the Secretary, all refined sugars
(whether derived from sugar beets or sugarcane) produced by cane
sugar refineries and beet sugar processors shall be fully substitutable for the export of sugar and sugar-containing products under
those programs.
‘‘(j) EFFECTIVE PERIOD.—This section shall be effective only
for the 1996 through 2007 crops of sugar beets and sugarcane.’’.
(b) EFFECTIVE DATE OF ASSESSMENT TERMINATION.—Subsection
(f) of section 156 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7272(f)), as in effect immediately
before the enactment of the Farm Security and Rural Investment
Act of 2002, is deemed to have been repealed effective as of October
1, 2001.
(c) INTEREST RATE.—Section 163 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7283) is amended—
(1) by inserting ‘‘(a) IN GENERAL.—’’ before ‘‘Notwithstanding’’; and
(2) by adding at the end the following:
‘‘(b) SUGAR.—For purposes of this section, raw cane sugar,
refined beet sugar, and in-process sugar eligible for a loan under
section 156 shall not be considered an agricultural commodity.’’.
SEC. 1402. STORAGE FACILITY LOANS.

7 USC 7272 note.

7 USC 7971.

(a) IN GENERAL.—Notwithstanding any other provision of law
and as soon as practicable after the date of enactment of this
Act, the Commodity Credit Corporation shall amend part 1436
of title 7, Code of Federal Regulations, to establish a sugar storage
facility loan program to provide financing for processors of domestically-produced sugarcane and sugar beets to construct or upgrade
storage and handling facilities for raw sugars and refined sugars.
(b) ELIGIBLE PROCESSORS.—A storage facility loan described
in subsection (a) shall be made available to any processor of domestically produced sugarcane or sugar beets that (as determined by
the Secretary)—
(1) has a satisfactory credit history;
(2) has a need for increased storage capacity, taking into
account the effects of marketing allotments; and
(3) demonstrates an ability to repay the loan.
(c) TERM OF LOANS.—A storage facility loan described in subsection (a) shall—
(1) have a minimum term of 7 years; and
(2) be in such amounts and on such terms and conditions
(including terms and conditions relating to downpayments,
collateral, and eligible facilities) as are normal, customary,
and appropriate for the size and commercial nature of the
borrower.
SEC. 1403. FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR.

Part VII of subtitle B of title III of the Agricultural Adjustment
Act of 1938 (7 U.S.C. 359aa et seq.) is amended to read as follows:

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PUBLIC LAW 107–171—MAY 13, 2002

‘‘PART VII—FLEXIBLE MARKETING
ALLOTMENTS FOR SUGAR
7 USC 1359aa.

‘‘SEC. 359a. DEFINITIONS.

‘‘In this part:
‘‘(1) MAINLAND STATE.—The term ‘mainland State’ means
a State other than an offshore State.
‘‘(2) OFFSHORE STATE.—The term ‘offshore State’ means
a sugarcane producing State located outside of the continental
United States.
‘‘(3) STATE.—Notwithstanding section 301, the term ‘State’
means—
‘‘(A) a State;
‘‘(B) the District of Columbia; and
‘‘(C) the Commonwealth of Puerto Rico.
‘‘(4) UNITED STATES.—The term ‘United States’, when used
in a geographical sense, means all of the States.
7 USC 1359bb.

‘‘SEC. 359b. FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR.

‘‘(a) SUGAR ESTIMATES.—
‘‘(1) IN GENERAL.—Not later than August 1 before the beginning of each of the 2002 through 2007 crop years, the Secretary
shall estimate—
‘‘(A) the quantity of sugar that will be consumed in
the United States during the crop year;
‘‘(B) the quantity of sugar that would provide for
reasonable carryover stocks;
‘‘(C) the quantity of sugar that will be available from
carry-in stocks for consumption in the United States during
the crop year;
‘‘(D) the quantity of sugar that will be available from
the domestic processing of sugarcane and sugar beets; and
‘‘(E) the quantity of sugars, syrups, and molasses that
will be imported for human consumption or to be used
for the extraction of sugar for human consumption in the
United States during the crop year, whether such articles
are under a tariff-rate quota or are in excess or outside
of a tariff-rate quota.
‘‘(2) EXCLUSION.—The estimates under this subsection shall
not apply to sugar imported for the production of polyhydric
alcohol or to any sugar refined and reexported in refined form
or in products containing sugar.
‘‘(3) REESTIMATES.—The Secretary shall make reestimates
of sugar consumption, stocks, production, and imports for a
crop year as necessary, but no later than the beginning of
each of the second through fourth quarters of the crop year.
‘‘(b) SUGAR ALLOTMENTS.—
‘‘(1) IN GENERAL.—By the beginning of each crop year,
the Secretary shall establish for that crop year appropriate
allotments under section 359c for the marketing by processors
of sugar processed from sugar beets and from domestically
produced sugarcane at a level that the Secretary estimates
will result in no forfeitures of sugar to the Commodity Credit
Corporation under the loan program for sugar established under
section 156 of the Federal Agriculture Improvement and Reform
Act of 1996 (7 U.S.C. 7272).

Deadline.

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‘‘(2) PRODUCTS.—The Secretary may include sugar products,
whose majority content is sucrose for human consumption,
derived from sugarcane, sugar beets, molasses, or sugar in
the allotments under paragraph (1) if the Secretary determines
it to be appropriate for purposes of this part.
‘‘(c) PROHIBITIONS.—
‘‘(1) IN GENERAL.—During any crop year or portion thereof
for which marketing allotments have been established, no processor of sugar beets or sugarcane shall market a quantity
of sugar in excess of the allocation established for such processor, except to enable another processor to fulfill an allocation
established for such other processor or to facilitate the exportation of such sugar.
‘‘(2) CIVIL PENALTY.—Any processor who knowingly violates
paragraph (1) shall be liable to the Commodity Credit Corporation for a civil penalty in an amount equal to 3 times the
United States market value, at the time of the commission
of the violation, of that quantity of sugar involved in the violation.
‘‘(3) DEFINITION OF MARKET.—For purposes of this part,
the term ‘market’ shall mean to sell or otherwise dispose of
in commerce in the United States (including the forfeiture
of sugar under the loan program for sugar under section 156
of the Federal Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7272) and, with respect to any integrated processor and refiner, the movement of raw cane sugar into the
refining process).
‘‘SEC. 359c. ESTABLISHMENT OF FLEXIBLE MARKETING ALLOTMENTS.

7 USC 1359cc.

‘‘(a) IN GENERAL.—The Secretary shall establish flexible marketing allotments for sugar for any crop year in which the allotments are required under section 359b(b) in accordance with this
section.
‘‘(b) OVERALL ALLOTMENT QUANTITY.—
‘‘(1) IN GENERAL.—The Secretary shall establish the overall
quantity of sugar to be allotted for the crop year (in this
part referred to as the ‘overall allotment quantity’) by deducting
from the sum of the estimated sugar consumption and reasonable carryover stocks (at the end of the crop year) for the
crop year, as determined under section 359b(a)—
‘‘(A) 1,532,000 short tons, raw value; and
‘‘(B) carry-in stocks of sugar, including sugar in Commodity Credit Corporation inventory.
‘‘(2) ADJUSTMENT.—The Secretary shall adjust the overall
allotment quantity to avoid the forfeiture of sugar to the Commodity Credit Corporation.
‘‘(c) MARKETING ALLOTMENT FOR SUGAR DERIVED FROM SUGAR
BEETS AND SUGAR DERIVED FROM SUGARCANE.—The overall allotment quantity for the crop year shall be allotted between—
‘‘(1) sugar derived from sugar beets by establishing a marketing allotment for a crop year at a quantity equal to the
product of multiplying the overall allotment quantity for the
crop year by 54.35 percent; and
‘‘(2) sugar derived from sugarcane by establishing a marketing allotment for a crop year at a quantity equal to the
product of multiplying the overall allotment quantity for the
crop year by 45.65 percent.

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‘‘(d) FILLING CANE SUGAR AND BEET SUGAR ALLOTMENTS.—
‘‘(1) CANE SUGAR.—Each marketing allotment for cane
sugar established under this section may only be filled with
sugar processed from domestically grown sugarcane.
‘‘(2) BEET SUGAR.—Each marketing allotment for beet sugar
established under this section may only be filled with sugar
domestically processed from sugar beets.
‘‘(e) STATE CANE SUGAR ALLOTMENTS.—
‘‘(1) IN GENERAL.—The allotment for sugar derived from
sugarcane shall be further allotted, among the States in the
United States in which sugarcane is produced, after a hearing
(if requested by the affected sugarcane processors and growers)
and on such notice as the Secretary by regulation may prescribe, in a fair and equitable manner as provided in this
subsection and section 359d(b)(1)(D).
‘‘(2) OFFSHORE ALLOTMENT.—
‘‘(A) COLLECTIVELY.—Prior to the allotment of sugar
derived from sugarcane to any other State, 325,000 short
tons, raw value shall be allotted to the offshore States.
‘‘(B) INDIVIDUALLY.—The collective offshore State allotment provided for under subparagraph (A) shall be further
allotted among the offshore States in which sugarcane is
produced, after a hearing (if requested by the affected
sugarcane processors and growers) and on such notice as
the Secretary by regulation may prescribe, in a fair and
equitable manner on the basis of—
‘‘(i) past marketings of sugar, based on the average
of the 2 highest years of production of raw cane sugar
from the 1996 through 2000 crops;
‘‘(ii) the ability of processors to market the sugar
covered under the allotments for the crop year; and
‘‘(iii) past processings of sugar from sugarcane,
based on the 3-year average of the 1998 through 2000
crop years.
‘‘(3) MAINLAND ALLOTMENT.—The allotment for sugar
derived from sugarcane, less the amount provided for under
paragraph (2), shall be allotted among the mainland States
in the United States in which sugarcane is produced, after
a hearing (if requested by the affected sugarcane processors
and growers) and on such notice as the Secretary by regulation
may prescribe, in a fair and equitable manner on the basis
of—
‘‘(A) past marketings of sugar, based on the average
of the 2 highest years of production of raw cane sugar
from the 1996 through 2000 crops;
‘‘(B) the ability of processors to market the sugar covered under the allotments for the crop year; and
‘‘(C) past processings of sugar from sugarcane, based
on the 3 crop years with the greatest processings (in the
mainland States collectively) during the 1991 through 2000
crop years.
‘‘(f) FILLING CANE SUGAR ALLOTMENTS.—Except as provided
in section 359e, a State cane sugar allotment established under
subsection (e) for a crop year may be filled only with sugar processed
from sugarcane grown in the State covered by the allotment.
‘‘(g) ADJUSTMENT OF MARKETING ALLOTMENTS.—

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116 STAT. 191

‘‘(1) IN GENERAL.—The Secretary shall, based on
reestimates under section 359b(a)(3), adjust upward or downward marketing allotments in a fair and equitable manner,
as the Secretary determines appropriate, to reflect changes
in estimated sugar consumption, stocks, production, or imports.
‘‘(2) ALLOCATION TO PROCESSORS.—In the case of any
increase or decrease in an allotment, each allocation to a processor of the allotment under section 359d, and each proportionate share established with respect to the allotment under
section 359f(c), shall be increased or decreased by the same
percentage that the allotment is increased or decreased.
‘‘(3) CARRY-OVER OF REDUCTIONS.—Whenever a marketing
allotment for a crop year is required to be reduced during
the crop year under this subsection, if, at the time of the
reduction, the quantity of sugar marketed exceeds the processor’s reduced allocation, the allocation of an allotment next
established for the processor shall be reduced by the quantity
of the excess sugar marketed.
‘‘(h) SUSPENSION OF ALLOTMENTS.—Whenever the Secretary
estimates or reestimates under section 359b(a), or has reason to
believe, that imports of sugars, syrups or molasses for human
consumption or to be used for the extraction of sugar for human
consumption, whether under a tariff-rate quota or in excess or
outside of a tariff-rate quota, will exceed 1,532,000 short tons (raw
value equivalent) (excluding any imports attributable to reassignment under paragraph (1)(D) or (2)(C) of section 359e(b)), and
that the imports would lead to a reduction of the overall allotment
quantity, the Secretary shall suspend the marketing allotments
established under this section until such time as the imports have
been restricted, eliminated, or reduced to or below the level of
1,532,000 short tons (raw value equivalent).
‘‘SEC. 359d. ALLOCATION OF MARKETING ALLOTMENTS.

7 USC 1359dd.

‘‘(a) ALLOCATION TO PROCESSORS.—Whenever marketing allotments are established for a crop year under section 359c, in order
to afford all interested persons an equitable opportunity to market
sugar under an allotment, the Secretary shall allocate each such
allotment among the processors covered by the allotment.
‘‘(b) HEARING AND NOTICE.—
‘‘(1) CANE SUGAR.—
‘‘(A) IN GENERAL.—The Secretary shall make allocations for cane sugar after a hearing, if requested by the
affected sugarcane processors and growers, and on such
notice as the Secretary by regulation may prescribe, in
such manner and in such quantities as to provide a fair,
efficient, and equitable distribution of the allocations under
this paragraph. Each such allocation shall be subject to
adjustment under section 359c(g).
‘‘(B) MULTIPLE PROCESSOR STATES.—Except as provided
in subparagraphs (C) and (D), the Secretary shall allocate
the allotment for cane sugar among multiple cane sugar
processors in a single State based on—
‘‘(i) past marketings of sugar, based on the average
of the 2 highest years of production of raw cane sugar
from among the 1996 through 2000 crops;

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(ii) the ability of processors to market sugar covered by that portion of the allotment allocated for
the crop year; and
‘‘(iii) past processings of sugar from sugarcane,
based on the average of the 3 highest years of production during the 1996 through 2000 crop years.
‘‘(C) TALISMAN PROCESSING FACILITY.—In the case of
allotments under subparagraph (B) attributable to the operations of the Talisman processing facility before the date
of enactment of this subparagraph, the Secretary shall
allocate the allotment among processors in the State under
subparagraph (A) in accordance with the agreements of
March 25 and 26, 1999, between the affected processors
and the Secretary of the Interior.
‘‘(D) PROPORTIONATE SHARE STATES.—In the case of
States subject to section 359f(c), the Secretary shall allocate
the allotment for cane sugar among multiple cane sugar
processors in a single State based on—
‘‘(i) past marketings of sugar, based on the average
of the 2 highest years of production of raw cane sugar
from among the 1997 through 2001 crop years;
‘‘(ii) the ability of processors to market sugar covered by that portion of the allotments allocated for
the crop year; and
‘‘(iii) past processings of sugar from sugarcane,
based on the average of the 2 highest crop years of
crop production during the 1997 through 2001 crop
years.
‘‘(E) NEW ENTRANTS.—
‘‘(i) IN GENERAL.—Notwithstanding subparagraphs
(B) and (D), the Secretary, on application of any processor that begins processing sugarcane on or after the
date of enactment of this subparagraph, and after a
hearing (if requested by the affected sugarcane processors and growers) and on such notice as the Secretary
by regulation may prescribe, may provide the processor
with an allocation that provides a fair, efficient and
equitable distribution of the allocations from the allotment for the State in which the processor is located.
‘‘(ii) PROPORTIONATE SHARE STATES.—In the case
of proportionate share States, the Secretary shall
establish proportionate shares in a quantity sufficient
to produce the sugarcane required to satisfy the allocations.
‘‘(iii) LIMITATIONS.—The allotment for a new processor under this subparagraph shall not exceed—
‘‘(I) in the case of the first crop year of operation of a new processor, 50,000 short tons (raw
value); and
‘‘(II) in the case of each subsequent crop year
of operation of the new processor, a quantity established by the Secretary in accordance with this
subparagraph and the criteria described in
subparagraph (B) or (D), as applicable.
‘‘(iv) NEW ENTRANT STATES.—
‘‘(I) IN GENERAL.—Notwithstanding subparagraphs (A) and (C) of section 359c(e)(3), to

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accommodate an allocation under clause (i) to a
new processor located in a new entrant mainland
State, the Secretary shall provide the new entrant
mainland State with an allotment.
‘‘(II) EFFECT ON OTHER ALLOTMENTS.—The
allotment to any new entrant mainland State shall
be subtracted, on a pro rata basis, from the allotments otherwise allotted to each mainland State
under section 359c(e)(3).
‘‘(v) ADVERSE EFFECTS.—Before providing an initial
processor allocation or State allotment to a new entrant
processor or a new entrant State under this subparagraph, the Secretary shall take into consideration any
adverse effects that the provision of the allocation or
allotment may have on existing cane processors and
producers in mainland States.
‘‘(vi) ABILITY TO MARKET.—Consistent with section
359c and this section, any processor allocation or State
allotment made to a new entrant processor or to a
new entrant State under this subparagraph shall be
provided only after the applicant processor, or the
applicable processors in the State, have demonstrated
the ability to process, produce, and market (including
the transfer or delivery of the raw cane sugar to a
refinery for further processing or marketing) raw cane
sugar for the crop year for which the allotment is
applicable.
‘‘(vii) PROHIBITION.—Not more than 1 processor
allocation provided under this subparagraph may be
applicable to any individual sugar processing facility.
‘‘(F) TRANSFER OF OWNERSHIP.—Except as otherwise
provided in section 359f(c)(8), if a sugarcane processor is
sold or otherwise transferred to another owner or is closed
as part of an affiliated corporate group processing consolidation, the Secretary shall transfer the allotment allocation
for the processor to the purchaser, new owner, successor
in interest, or any remaining processor of an affiliated
entity, as applicable, of the processor.
‘‘(2) BEET SUGAR.—
‘‘(A) IN GENERAL.—Except as otherwise provided in
this paragraph and sections 359c(g), 359e(b), and 359f(b),
the Secretary shall make allocations for beet sugar among
beet sugar processors for each crop year that allotments
are in effect on the basis of the adjusted weighted average
quantity of beet sugar produced by the processors for each
of the 1998 through 2000 crop years, as determined under
this paragraph.
‘‘(B) QUANTITY.—The quantity of an allocation made
for a beet sugar processor for a crop year under subparagraph (A) shall bear the same ratio to the quantity of
allocations made for all beet sugar processors for the crop
year as the adjusted weighted average quantity of beet
sugar produced by the processor (as determined under subparagraphs (C) and (D)) bears to the total of the adjusted
weighted average quantities of beet sugar produced by
all processors (as so determined).

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(C) WEIGHTED AVERAGE QUANTITY.—Subject to
subparagraph (D), the weighted quantity of beet sugar
produced by a beet sugar processor during each of the
1998 through 2000 crop years shall be (as determined
by the Secretary)—
‘‘(i) in the case of the 1998 crop year, 25 percent
of the quantity of beet sugar produced by the processor
during the crop year;
‘‘(ii) in the case of the 1999 crop year, 35 percent
of the quantity of beet sugar produced by the processor
during the crop year; and
‘‘(iii) in the case of the 2000 crop year, 40 percent
of the quantity of beet sugar produced by the processor
(including any quantity of sugar received from the
Commodity Credit Corporation) during the crop year.
‘‘(D) ADJUSTMENTS.—
‘‘(i) IN GENERAL.—The Secretary shall adjust the
weighted average quantity of beet sugar produced by
a beet sugar processor during the 1998 through 2000
crop years under subparagraph (C) if the Secretary
determines that the processor—
‘‘(I) during the 1996 through 2000 crop years,
opened a sugar beet processing factory;
‘‘(II) during the 1998 through 2000 crop years,
closed a sugar beet processing factory;
‘‘(III) during the 1998 through 2000 crop years,
constructed a molasses desugarization facility; or
‘‘(IV) during the 1998 through 2000 crop years,
suffered substantial quality losses on sugar beets
stored during any such crop year.
‘‘(ii) QUANTITY.—The quantity of beet sugar produced by a beet sugar processor under subparagraph
(C) shall be—
‘‘(I) in the case of a processor that opened
a sugar beet processing factory, increased by 1.25
percent of the total of the adjusted weighted average quantities of beet sugar produced by all processors during the 1998 through 2000 crop years
(without consideration of any adjustment under
this subparagraph) for each sugar beet processing
factory that is opened by the processor;
‘‘(II) in the case of a processor that closed
a sugar beet processing factory, decreased by 1.25
percent of the total of the adjusted weighted average quantities of beet sugar produced by all processors during the 1998 through 2000 crop years
(without consideration of any adjustment under
this subparagraph) for each sugar beet processing
factory that is closed by the processor;
‘‘(III) in the case of a processor that constructed a molasses desugarization facility,
increased by 0.25 percent of the total of the
adjusted weighted average quantities of beet sugar
produced by all processors during the 1998 through
2000 crop years (without consideration of any
adjustment under this subparagraph) for each

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116 STAT. 195

molasses desugarization facility that is constructed
by the processor; and
‘‘(IV) in the case of a processor that suffered
substantial quality losses on stored sugar beets,
increased by 1.25 percent of the total of the
adjusted weighted average quantities of beet sugar
produced by all processors during the 1998 through
2000 crop years (without consideration of any
adjustment under this subparagraph).
‘‘(E) PERMANENT TERMINATION OF OPERATIONS OF A
PROCESSOR.—If a processor of beet sugar has been dissolved, liquidated in a bankruptcy proceeding, or otherwise
has permanently terminated operations (other than in
conjunction with a sale or other disposition of the processor
or the assets of the processor), the Secretary shall—
‘‘(i) eliminate the allocation of the processor provided under this section; and
‘‘(ii) distribute the allocation to other beet sugar
processors on a pro rata basis.
‘‘(F) SALE OF ALL ASSETS OF A PROCESSOR TO ANOTHER
PROCESSOR.—If a processor of beet sugar (or all of the
assets of the processor) is sold to another processor of
beet sugar, the Secretary shall transfer the allocation of
the seller to the buyer unless the allocation has been
distributed to other sugar beet processors under subparagraph (E).
‘‘(G) SALE OF FACTORIES OF A PROCESSOR TO ANOTHER
PROCESSOR.—
‘‘(i) IN GENERAL.—Subject to subparagraphs (E)
and (F), if 1 or more factories of a processor of beet
sugar (but not all of the assets of the processor) are
sold to another processor of beet sugar during a crop
year, the Secretary shall assign a pro rata portion
of the allocation of the seller to the allocation of the
buyer to reflect the historical contribution of the
production of the sold factory or factories to the total
allocation of the seller.
‘‘(ii) APPLICATION OF ALLOCATION.—The assignment of the allocation under clause (i) shall apply—
‘‘(I) during the remainder of the crop year
during which the sale described in clause (i) occurs
(referred to in this subparagraph as the ‘initial
crop year’); and
‘‘(II) each subsequent crop year (referred in
this subparagraph as a ‘subsequent crop year’),
subject to clause (iii).
‘‘(iii) SUBSEQUENT CROP YEARS.—
‘‘(I) IN GENERAL.—The assignment of the
allocation under clause (i) shall apply during each
subsequent crop year unless the acquired factory
or factories continue in operation for less than
the initial crop year and the first subsequent crop
year.
‘‘(II) REASSIGNMENT.—If the acquired factory
or factories do not continue in operation for the
complete initial crop year and the first subsequent

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crop year, the Secretary shall reassign the temporary allocation to other processors of beet sugar
on a pro rata basis.
‘‘(iv) USE OF OTHER FACTORIES TO FILL ALLOCATION.—If the transferred allocation to the buyer for
the purchased factory or factories cannot be filled by
the production of the purchased factory or factories
for the initial crop year or a subsequent crop year,
the remainder of the transferred allocation may be
filled by beet sugar produced by the buyer from other
factories of the buyer.
‘‘(H) NEW ENTRANTS STARTING PRODUCTION OR
REOPENING FACTORIES.—
‘‘(i) IN GENERAL.—Except as provided by clause
(ii), if an individual or entity that does not have an
allocation of beet sugar under this part (referred to
in this paragraph as a ‘new entrant’) starts processing
sugar beets after the date of enactment of this subparagraph, or acquires and reopens a factory that produced
beet sugar during previous crop years that (at the
time of acquisition) has no allocation associated with
the factory under this part, the Secretary shall—
‘‘(I) assign an allocation for beet sugar to the
new entrant that provides a fair and equitable
distribution of the allocations for beet sugar; and
‘‘(II) reduce the allocations for beet sugar of
all other processors on a pro rata basis to reflect
the new allocation.
‘‘(ii) EXCEPTION.—If a new entrant acquires and
reopens a factory that previously produced beet sugar
from sugar beets and from sugar beet molasses but
the factory last processed sugar beets during the 1997
crop year and the new entrant starts to process sugar
beets at such factory after the date of enactment of
this clause, the Secretary shall—
‘‘(I) assign an allocation for beet sugar to the
new entrant that is not less than the greater of
1.67 percent of the total of the adjusted weighted
average quantities of beet sugar produced by all
processors during the 1998 through 2000 crop
years as determined under subsection (b)(2)(C),
or 1,500,000 hundredweights; and
‘‘(II) reduce the allocations for beet sugar of
all other processors on a pro rata basis to reflect
the new allocation.
‘‘(I) NEW ENTRANTS ACQUIRING ONGOING FACTORIES
WITH PRODUCTION HISTORY.—If a new entrant acquires a
factory that has production history during the period of
the 1998 through 2000 crop years and that is producing
beet sugar at the time the allocations are made from a
processor that has an allocation of beet sugar, the Secretary
shall transfer a portion of the allocation of the seller to
the new entrant to reflect the historical contribution of
the production of the sold factory to the total allocation
of the seller.

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‘‘SEC. 359e. REASSIGNMENT OF DEFICITS.

7 USC 1359ee.

‘‘(a) ESTIMATES OF DEFICITS.—At any time allotments are in
effect under this part, the Secretary, from time to time, shall
determine whether (in view of then-current inventories of sugar,
the estimated production of sugar and expected marketings, and
other pertinent factors) any processor of sugarcane will be unable
to market the sugar covered by the portion of the State cane
sugar allotment allocated to the processor and whether any processor of sugar beets will be unable to market sugar covered by
the portion of the beet sugar allotment allocated to the processor.
‘‘(b) REASSIGNMENT OF DEFICITS.—
‘‘(1) CANE SUGAR.—If the Secretary determines that any
sugarcane processor who has been allocated a share of a State
cane sugar allotment will be unable to market the processor’s
allocation of the State’s allotment for the crop year—
‘‘(A) the Secretary first shall reassign the estimated
quantity of the deficit to the allocations for other processors
within that State, depending on the capacity of each other
processor to fill the portion of the deficit to be assigned
to it and taking into account the interests of producers
served by the processors;
‘‘(B) if after the reassignments the deficit cannot be
completely eliminated, the Secretary shall reassign the estimated quantity of the deficit proportionately to the allotments for other cane sugar States, depending on the
capacity of each other State to fill the portion of the deficit
to be assigned to it, with the reassigned quantity to each
State to be allocated among processors in that State in
proportion to the allocations of the processors;
‘‘(C) if after the reassignments the deficit cannot be
completely eliminated, the Secretary shall reassign the estimated quantity of the deficit to the Commodity Credit
Corporation and shall sell such quantity of sugar from
inventories of the Corporation unless the Secretary determines that such sales would have a significant effect on
the price of sugar; and
‘‘(D) if after the reassignments and sales, the deficit
cannot be completely eliminated, the Secretary shall
reassign the remainder to imports.
‘‘(2) BEET SUGAR.—If the Secretary determines that a sugar
beet processor who has been allocated a share of the beet
sugar allotment will be unable to market that allocation—
‘‘(A) the Secretary first shall reassign the estimated
quantity of the deficit to the allotments for other sugar
beet processors, depending on the capacity of each other
processor to fill the portion of the deficit to be assigned
to it and taking into account the interests of producers
served by the processors;
‘‘(B) if after the reassignments the deficit cannot be
completely eliminated, the Secretary shall reassign the estimated quantity of the deficit to the Commodity Credit
Corporation and shall sell such quantity of sugar from
inventories of the Corporation unless the Secretary determines that such sales would have a significant effect on
the price of sugar; and

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‘‘(C) if after the reassignments and sales, the deficit
cannot be completely eliminated, the Secretary shall
reassign the remainder to imports.
‘‘(3) CORRESPONDING INCREASE.—The allocation of each
processor receiving a reassigned quantity of an allotment under
this subsection for a crop year shall be increased to reflect
the reassignment.

7 USC 1359ff.

‘‘SEC. 359f. PROVISIONS APPLICABLE TO PRODUCERS.

‘‘(a) PROCESSOR ASSURANCES.—
‘‘(1) IN GENERAL.—If allotments for a crop year are allocated
to processors under section 359d, the Secretary shall obtain
from the processors such assurances as the Secretary considers
adequate that the allocation will be shared among producers
served by the processor in a fair and equitable manner that
adequately reflects producers’ production histories.
‘‘(2) ARBITRATION.—
‘‘(A) IN GENERAL.—Any dispute between a processor
and a producer, or group of producers, with respect to
the sharing of the allocation to the processor shall be
resolved through arbitration by the Secretary on the
request of either party.
‘‘(B) PERIOD.—The arbitration shall, to the maximum
extent practicable, be—
‘‘(i) commenced not more than 45 days after the
request; and
‘‘(ii) completed not more than 60 days after the
request.
‘‘(b) SUGAR BEET PROCESSING FACILITY CLOSURES.—
‘‘(1) IN GENERAL.—If a sugar beet processing facility is
closed and the sugar beet growers that previously delivered
beets to the facility elect to deliver their beets to another
processing company, the growers may petition the Secretary
to modify allocations under this part to allow the delivery.
‘‘(2) INCREASED ALLOCATION FOR PROCESSING COMPANY.—
The Secretary may increase the allocation to the processing
company to which the growers elect to deliver their sugar
beets, with the approval of the processing company, to a level
that does not exceed the processing capacity of the processing
company, to accommodate the change in deliveries.
‘‘(3) DECREASED ALLOCATION FOR CLOSED COMPANY.—The
increased allocation shall be deducted from the allocation to
the company that owned the processing facility that has been
closed and the remaining allocation shall be unaffected.
‘‘(4) TIMING.—The determinations of the Secretary on the
issues raised by the petition shall be made within 60 days
after the filing of the petition.
‘‘(c) PROPORTIONATE SHARES OF CERTAIN ALLOTMENTS.—
‘‘(1) IN GENERAL.—
‘‘(A) STATES AFFECTED.—In any case in which a State
allotment is established under section 359c(f) and there
are in excess of 250 sugarcane producers in the State
(other than Puerto Rico), the Secretary shall make a determination under subparagraph (B).
‘‘(B) DETERMINATION.—The Secretary shall determine,
for each State allotment described in subparagraph (A),
whether the production of sugarcane, in the absence of

Deadlines.

Deadline.

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proportionate shares, will be greater than the quantity
needed to enable processors to fill the allotment and provide
a normal carryover inventory of sugar.
‘‘(2) ESTABLISHMENT OF PROPORTIONATE SHARES.—If the
Secretary determines under paragraph (1) that the quantity
of sugarcane produced by producers in the area covered by
a State allotment for a crop year will be in excess of the
quantity needed to enable processors to fill the allotment for
the crop year and provide a normal carryover inventory of
sugar, the Secretary shall establish a proportionate share for
each sugarcane-producing farm that limits the acreage of sugarcane that may be harvested on the farm for sugar or seed
during the crop year the allotment is in effect as provided
in this subsection. Each such proportionate share shall be subject to adjustment under paragraph (7) and section 359c(g).
‘‘(3) METHOD OF DETERMINING.—For purposes of determining proportionate shares for any crop of sugarcane:
‘‘(A) The Secretary shall establish the State’s per-acre
yield goal for a crop of sugarcane at a level (not less
than the average per-acre yield in the State for the 2
highest years from among the 1999, 2000, and 2001 crop
years, as determined by the Secretary) that will ensure
an adequate net return per pound to producers in the
State, taking into consideration any available production
research data that the Secretary considers relevant.
‘‘(B) The Secretary shall adjust the per-acre yield goal
by the average recovery rate of sugar produced from sugarcane by processors in the State.
‘‘(C) The Secretary shall convert the State allotment
for the crop year involved into a State acreage allotment
for the crop by dividing the State allotment by the peracre yield goal for the State, as established under subparagraph (A) and as further adjusted under subparagraph
(B).
‘‘(D) The Secretary shall establish a uniform reduction
percentage for the crop by dividing the State acreage allotment, as determined for the crop under subparagraph (C),
by the sum of all adjusted acreage bases in the State,
as determined by the Secretary.
‘‘(E) The uniform reduction percentage for the crop,
as determined under subparagraph (D), shall be applied
to the acreage base for each sugarcane-producing farm
in the State to determine the farm’s proportionate share
of sugarcane acreage that may be harvested for sugar
or seed.
‘‘(4) ACREAGE BASE.—For purposes of this subsection, the
acreage base for each sugarcane-producing farm shall be determined by the Secretary, as follows:
‘‘(A) The acreage base for any farm shall be the number
of acres that is equal to the average of the acreage planted
and considered planted for harvest for sugar or seed on
the farm in the 2 highest of the 1999, 2000, and 2001
crop years.
‘‘(B) Acreage planted to sugarcane that producers on
a farm were unable to harvest to sugarcane for sugar
or seed because of drought, flood, other natural disaster,
or other condition beyond the control of the producers may

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PUBLIC LAW 107–171—MAY 13, 2002
be considered as harvested for the production of sugar
or seed for purposes of this paragraph.
‘‘(5) VIOLATION.—
‘‘(A) IN GENERAL.—Whenever proportionate shares are
in effect in a State for a crop of sugarcane, producers
on a farm shall not knowingly harvest, or allow to be
harvested, for sugar or seed an acreage of sugarcane in
excess of the farm’s proportionate share for the crop year,
or otherwise violate proportionate share regulations issued
by the Secretary under section 359h(a).
‘‘(B) DETERMINATION OF VIOLATION.—No producer shall
be considered to have violated subparagraph (A) unless
the processor of the sugarcane harvested by such producer
from acreage in excess of the proportionate share of the
farm markets an amount of sugar that exceeds the allocation of such processor for a crop year.
‘‘(C) CIVIL PENALTY.—Any producer on a farm who
violates subparagraph (A) by knowingly harvesting, or
allowing to be harvested, an acreage of sugarcane in excess
of the farm’s proportionate share shall be liable to the
Commodity Credit Corporation for a civil penalty equal
to one and one-half times the United States market value
of the quantity of sugar that is marketed by the processor
of such sugarcane in excess of the allocation of such processor for the crop year. The Secretary shall prorate penalties imposed under this subparagraph in a fair and equitable manner among all the producers of sugarcane harvested from excess acreage that is acquired by such processor.
‘‘(6) WAIVER.—Notwithstanding the preceding subparagraph, the Secretary may authorize the county and State
committees established under section 8(b) of the Soil Conservation and Domestic Allotment Act (16 U.S.C. 590h(b)) to waive
or modify deadlines and other proportionate share requirements
in cases in which lateness or failure to meet the other requirements does not affect adversely the operation of proportionate
shares.
‘‘(7) ADJUSTMENTS.—Whenever the Secretary determines
that, because of a natural disaster or other condition beyond
the control of producers that adversely affects a crop of sugarcane subject to proportionate shares, the amount of sugarcane
produced by producers subject to the proportionate shares will
not be sufficient to enable processors in the State to meet
the State’s cane sugar allotment and provide a normal carryover
inventory of sugar, the Secretary may uniformly allow producers to harvest an amount of sugarcane in excess of their
proportionate share, or suspend proportionate shares entirely,
as necessary to enable processors to meet the State allotment
and provide a normal carryover inventory of sugar.
‘‘(8) PROCESSING FACILITY CLOSURES.—
‘‘(A) IN GENERAL.—If a sugarcane processing facility
subject to this subsection is closed and the sugarcane
growers that delivered sugarcane to the facility prior to
closure elect to deliver their sugarcane to another processing company, the growers may petition the Secretary
to modify allocations under this part to allow the delivery.

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‘‘(B) INCREASED ALLOCATION FOR PROCESSING COMPANY.—The Secretary may increase the allocation to the
processing company to which the growers elect to deliver
the sugarcane, with the approval of the processing company, to a level that does not exceed the processing capacity
of the processing company, to accommodate the change
in deliveries.
‘‘(C) DECREASED ALLOCATION FOR CLOSED COMPANY.—
The increased allocation shall be deducted from the allocation to the company that owned the processing facility
that has been closed and the remaining allocation shall
be unaffected.
‘‘(D) TIMING.—The determinations of the Secretary on
the issues raised by the petition shall be made within
60 days after the filing of the petition.
‘‘SEC. 359g. SPECIAL RULES.

Deadline.

7 USC 1359gg.

‘‘(a) TRANSFER OF ACREAGE BASE HISTORY.—For the purpose
of establishing proportionate shares for sugarcane farms under
section 359f(c), the Secretary, on application of any producer, with
the written consent of all owners of a farm, may transfer the
acreage base history of the farm to any other parcels of land
of the applicant.
‘‘(b) PRESERVATION OF ACREAGE BASE HISTORY.—If for reasons
beyond the control of a producer on a farm, the producer is unable
to harvest an acreage of sugarcane for sugar or seed with respect
to all or a portion of the proportionate share established for the
farm under section 359f(c), the Secretary, on the application of
the producer and with the written consent of all owners of the
farm, may preserve for a period of not more than 5 consecutive
years the acreage base history of the farm to the extent of the
proportionate share involved. The Secretary may permit the proportionate share to be redistributed to other farms, but no acreage
base history for purposes of establishing acreage bases shall accrue
to the other farms by virtue of the redistribution of the proportionate share.
‘‘(c) REVISIONS OF ALLOCATIONS AND PROPORTIONATE SHARES.—
The Secretary, after such notice as the Secretary by regulation
may prescribe, may revise or amend any allocation of a marketing
allotment under section 359d, or any proportionate share established or adjusted for a farm under section 359f(c), on the same
basis as the initial allocation or proportionate share was required
to be established.
‘‘(d) TRANSFERS OF MILL ALLOCATIONS.—
‘‘(1) TRANSFER AUTHORIZED.—A producer in a proportionate
share State, upon written consent from all crop-share owners
(or the representative of the crop-share owners) of a farm,
and from the processing company holding the applicable allocation for such shares, may deliver sugarcane to another processing company if the additional delivery, when combined with
such other processing company’s existing deliveries, does not
exceed the processing capacity of the company.
‘‘(2) ALLOCATION ADJUSTMENT.—Notwithstanding section
359d, the Secretary shall adjust the allocations of each of such
processing companies affected by a transfer under paragraph
(1) to reflect the change in deliveries, based on the product
of—

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(A) the number of acres of proportionate shares being
transferred; and
‘‘(B) the State’s per acre yield goal established under
section 359f(c)(3).

7 USC 1359hh.

‘‘SEC.

359h.

REGULATIONS; VIOLATIONS; PUBLICATION OF SECRETARY’S DETERMINATIONS; JURISDICTION OF THE
COURTS; UNITED STATES ATTORNEYS.

‘‘(a) REGULATIONS.—The Secretary or the Commodity Credit
Corporation, as appropriate, shall issue such regulations as may
be necessary to carry out the authority vested in the Secretary
in administering this part.
‘‘(b) VIOLATION.—Any person knowingly violating any regulation
of the Secretary issued under subsection (a) shall be subject to
a civil penalty of not more than $5,000 for each violation.
‘‘(c) PUBLICATION IN FEDERAL REGISTER.—Each determination
issued by the Secretary to establish, adjust, or suspend allotments
under this part shall be promptly published in the Federal Register
and shall be accompanied by a statement of the reasons for the
determination.
‘‘(d) JURISDICTION OF COURTS; UNITED STATES ATTORNEYS.—
‘‘(1) JURISDICTION OF COURTS.—The several district courts
of the United States are vested with jurisdiction specifically
to enforce, and to prevent and restrain any person from violating, this part or any regulation issued thereunder.
‘‘(2) UNITED STATES ATTORNEYS.—Whenever the Secretary
shall so request, it shall be the duty of the several United
States attorneys, in their respective districts, to institute proceedings to enforce the remedies and to collect the penalties
provided for in this part. The Secretary may elect not to refer
to a United States attorney any violation of this part or regulation when the Secretary determines that the administration
and enforcement of this part would be adequately served by
written notice or warning to any person committing the violation.
‘‘(e) NONEXCLUSIVITY OF REMEDIES.—The remedies and penalties provided for in this part shall be in addition to, and not
exclusive of, any remedies or penalties existing at law or in equity.
7 USC 1359ii.

‘‘SEC. 359i. APPEALS.

‘‘(a) IN GENERAL.—An appeal may be taken to the Secretary
from any decision under section 359d establishing allocations of
marketing allotments, or under section 359f, by any person
adversely affected by reason of any such decision.
‘‘(b) PROCEDURE.—
‘‘(1) NOTICE OF APPEAL.—Any such appeal shall be taken
by filing with the Secretary, within 20 days after the decision
complained of is effective, notice in writing of the appeal and
a statement of the reasons therefor. Unless a later date is
specified by the Secretary as part of the Secretary’s decision,
the decision complained of shall be considered to be effective
as of the date on which announcement of the decision is made.
The Secretary shall deliver a copy of any notice of appeal
to each person shown by the records of the Secretary to be
adversely affected by reason of the decision appealed, and shall
at all times thereafter permit any such person to inspect and
make copies of appellant’s reasons for the appeal and shall
on application permit the person to intervene in the appeal.

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‘‘(2) HEARING.—The Secretary shall provide each appellant
an opportunity for a hearing before an administrative law judge
in accordance with sections 554 and 556 of title 5, United
States Code. The expenses for conducting the hearing shall
be reimbursed by the Commodity Credit Corporation.
‘‘(c) SPECIAL APPEAL PROCESS REGARDING BEET SUGAR ALLOCATIONS.—
‘‘(1) APPEAL AUTHORIZED.—Beginning after the 2006 crop
year, a processor that has an allocation of the beet sugar
allotment under this part (referred to in this subsection as
a ‘petitioner’) may file a notice of appeal with the Secretary
regarding the petitioner’s beet sugar allocation. Except as provided in paragraph (2), the Secretary shall consider the appeal
if the notice alleges that any processor that has a beet sugar
allocation has failed to fill at least 82.5 percent of its allocation
of the beet sugar allotment with sugar produced by it or
received from the Commodity Credit Corporation in 2 out of
the 3 crop years preceding the crop year in which the appeal
is filed. A processor that is alleged to have failed to fill at
least 82.5 percent of its allocation shall be allowed to fully
participate in the appeal.
‘‘(2) EXCEPTIONS.—An appeal under paragraph (1) shall
not be based on the failure of a processor to fill at least
82.5 percent of its allocation because of drought, flood, hail,
or other weather disaster, as determined by the Secretary.
The determination by the Secretary shall not require a formal
disaster declaration.
‘‘(3) RESPONSE TO APPEAL.—Upon the petitioner making
an appeal to the Secretary, and upon a review by the Secretary
of how processors have filled their allocations, the Secretary
may—
‘‘(A) assign an increased allocation for beet sugar to
the petitioner that provides a fair and equitable distribution of the allocations for beet sugar, taking into account—
‘‘(i) production history during the period beginning
on April 4, 1996, and through the date of enactment
of the Farm Security and Rural Investment Act of
2002;
‘‘(ii) capital investment during that period;
‘‘(iii) increases in United States sugar consumption; and
‘‘(iv) the ability or inability of processors to fill
the allocations they have received under this part;
and
‘‘(B) reduce, correspondingly, the allocation for beet
sugar of each processor determined to have failed to fill
at least 82.5 percent of its allocation of the beet sugar
allotment as described in paragraph (1).
‘‘(4) FILING DEADLINE.—For purposes of the filing deadline
specified in subsection (b)(1), the 20-day period shall commence
on the date on which the Secretary announces the allocations
for the subsequent crop year or October 1, whichever is earlier.
‘‘SEC. 359j. ADMINISTRATION.

7 USC 1359jj.

‘‘(a) USE OF CERTAIN AGENCIES.—In carrying out this part,
the Secretary may use the services of local committees of sugar
beet or sugarcane producers, sugarcane processors, or sugar beet

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processors, State and county committees established under section
8(b) of the Soil Conservation and Domestic Allotment Act (16 U.S.C.
590h(b)), and the departments and agencies of the United States
Government.
‘‘(b) USE OF COMMODITY CREDIT CORPORATION.—The Secretary
shall use the services, facilities, funds, and authorities of the Commodity Credit Corporation to carry out this part.
7 USC 1359kk.

‘‘SEC. 359k. REALLOCATING SUGAR QUOTA IMPORT SHORTFALLS.

‘‘(a) IN GENERAL.—Notwithstanding any other provision of law,
on or after June 1 of each of the 2002 through 2007 calendar
years, the United States Trade Representative, in consultation with
the Secretary, shall determine the amount of the quota of cane
sugar used by each qualified supplying country for that crop year,
and may reallocate the unused quota for that crop year among
qualified supplying countries.
‘‘(b) QUALIFIED SUPPLYING COUNTRY DEFINED.—In this section,
the term ‘qualified supplying country’ means one of the following
foreign countries that is allowed to export cane sugar to the United
States under an agreement or any other country with which the
United States has an agreement relating to the importation of
cane sugar:
Argentina
Australia
Barbados
Belize
Bolivia
Brazil
Colombia
Republic of the Congo
Costa Rica
Dominican Republic
Ecuador
El Salvador
Fiji
Gabon
Guatemala
Guyana
Haiti
Honduras
India
Cote D’Ivoire, formerly known as the Ivory Coast
Jamaica
Madagascar
Malawi
Mauritius
Mexico
Mozambique
Nicaragua
Panama
Papua New Guinea
Paraguay
Peru
Philippines
St. Kitts and Nevis
South Africa
Swaziland
Taiwan
Thailand
Trinidad-Tobago
Uruguay
Zimbabwe.’’.

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116 STAT. 205

Subtitle E—Dairy
7 USC 7981.

SEC. 1501. MILK PRICE SUPPORT PROGRAM.

(a) SUPPORT ACTIVITIES.—During the period beginning on June
1, 2002, and ending on December 31, 2007, the Secretary of Agriculture shall support the price of milk produced in the 48 contiguous
States through the purchase of cheese, butter, and nonfat dry
milk produced from the milk.
(b) RATE.—During the period specified in subsection (a), the
price of milk shall be supported at a rate equal to $9.90 per
hundredweight for milk containing 3.67 percent butterfat.
(c) PURCHASE PRICES.—
(1) UNIFORM PRICES.—The support purchase prices under
this section for each of the products of milk (butter, cheese,
and nonfat dry milk) announced by the Secretary shall be
the same for all of that product sold by persons offering to
sell the product to the Secretary.
(2) SUFFICIENT PRICES.—The purchase prices shall be sufficient to enable plants of average efficiency to pay producers,
on average, a price that is not less than the rate of price
support for milk in effect under subsection (b).
(d) SPECIAL RULE FOR BUTTER AND NONFAT DRY MILK PURCHASE PRICES.—
(1) ALLOCATION OF PURCHASE PRICES.—The Secretary may
allocate the rate of price support between the purchase prices
for nonfat dry milk and butter in a manner that will result
in the lowest level of expenditures by the Commodity Credit
Corporation or achieve such other objectives as the Secretary
considers appropriate. Not later than 10 days after making
or changing an allocation, the Secretary shall notify the Committee on Agriculture of the House of Representatives and
the Committee on Agriculture, Nutrition, and Forestry of the
Senate of the allocation. Section 553 of title 5, United States
Code, shall not apply with respect to the implementation of
this section.
(2) TIMING OF PURCHASE PRICE ADJUSTMENTS.—The Secretary may make any such adjustments in the purchase prices
for nonfat dry milk and butter the Secretary considers to be
necessary not more than twice in each calendar year.
(e) COMMODITY CREDIT CORPORATION.—The Secretary shall
carry out the program authorized by this section through the Commodity Credit Corporation.
SEC. 1502. NATIONAL DAIRY MARKET LOSS PAYMENTS.

7 USC 7982.

(a) DEFINITIONS.—In this section:
(1) CLASS I MILK.—The term ‘Class I milk’ means milk
(including milk components) classified as Class I milk under
a Federal milk marketing order.
(2) ELIGIBLE PRODUCTION.—The term ‘eligible production’
means milk produced by a producer in a participating State.
(3) FEDERAL MILK MARKETING ORDER.—The term ‘Federal
milk marketing order’ means an order issued under section
8c of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted
with amendments by the Agricultural Marketing Agreement
Act of 1937.

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116 STAT. 206

Contracts.

Deadline.

Contracts.

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(4) PARTICIPATING STATE.—The term ‘participating State’
means each State.
(5) PRODUCER.—The term ‘producer’ means an individual
or entity that directly or indirectly (as determined by the Secretary)—
(A) shares in the risk of producing milk; and
(B) makes contributions (including land, labor,
management, equipment, or capital) to the dairy farming
operation of the individual or entity that are at least
commensurate with the share of the individual or entity
of the proceeds of the operation.
(b) PAYMENTS.—The Secretary shall offer to enter into contracts
with producers on a dairy farm located in a participating State
under which the producers receive payments on eligible production.
(c) AMOUNT.—Payments to a producer under this section shall
be calculated by multiplying (as determined by the Secretary)—
(1) the payment quantity for the producer during the
applicable month established under subsection (d);
(2) the amount equal to—
(A) $16.94 per hundredweight; less
(B) the Class I milk price per hundredweight in Boston
under the applicable Federal milk marketing order; by
(3) 45 percent.
(d) PAYMENT QUANTITY.—
(1) IN GENERAL.—Subject to paragraph (2), the payment
quantity for a producer during the applicable month under
this section shall be equal to the quantity of eligible production
marketed by the producer during the month.
(2) LIMITATION.—The payment quantity for all producers
on a single dairy operation during the months of the applicable
fiscal year for which the producers receive payments under
subsection (b) shall not exceed 2,400,000 pounds. For purposes
of determining whether producers are producers on separate
dairy operations or a single dairy operation, the Secretary
shall apply the same standards as were applied in implementing the dairy program under section 805 of the Agriculture,
Rural Development, Food and Drug Administration, and
Related Agencies Appropriations Act, 2001 (as enacted into
law by Public Law 106–387; 114 Stat. 1549A–50).
(3) RECONSTITUTION.—The Secretary shall promulgate
regulations to ensure that a producer does not reconstitute
a dairy operation for the sole purpose of receiving additional
payments under this section.
(e) PAYMENTS.—A payment under a contract under this section
shall be made on a monthly basis not later than 60 days after
the last day of the month for which the payment is made.
(f) SIGNUP.—The Secretary shall offer to enter into contracts
under this section during the period beginning on the date that
is 60 days after the date of enactment of this Act and ending
on September 30, 2005.
(g) DURATION OF CONTRACT.—
(1) IN GENERAL.—Except as provided in paragraph (2) and
subsection (h), any contract entered into by producers on a
dairy farm under this section shall cover eligible production
marketed by the producers on the dairy farm during the period
starting with the first day of month the producers on the

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dairy farm enter into the contract and ending on September
30, 2005.
(2) VIOLATIONS.—If a producer violates the contract, the
Secretary may—
(A) terminate the contract and allow the producer to
retain any payments received under the contract; or
(B) allow the contract to remain in effect and require
the producer to repay a portion of the payments received
under the contract based on the severity of the violation.
(h) TRANSITION RULE.—In addition to any payment that is
otherwise available under this section, if the producers on a dairy
farm enter into a contract under this section, the Secretary shall
make a payment in accordance with the formula specified in subsection (c) on the quantity of eligible production of the producer
marketed during the period beginning on December 1, 2001, and
ending on the last day of the month preceding the month the
producers on the dairy farm entered into the contract.
SEC. 1503. DAIRY EXPORT INCENTIVE AND DAIRY INDEMNITY PROGRAMS.

(a) DAIRY EXPORT INCENTIVE PROGRAM.—Section 153(a) of the
Food Security Act of 1985 (15 U.S.C. 713a–14(a)) is amended by
striking ‘‘2002’’ and inserting ‘‘2007’’.
(b) DAIRY INDEMNITY PROGRAM.—Section 3 of Public Law 90–
484 (7 U.S.C. 450l) is amended by striking ‘‘1995’’ and inserting
‘‘2007’’.
SEC. 1504. DAIRY PRODUCT MANDATORY REPORTING.

Section 272(1) of the Agricultural Marketing Act of 1946 (7
U.S.C. 1637a(1)) is amended—
(1) by striking ‘‘means manufactured dairy products’’ and
inserting ‘‘means—
‘‘(A) manufactured dairy products’’;
(2) by striking the period at the end and inserting ‘‘; and’’;
and
(3) by adding at the end the following:
‘‘(B) substantially identical products designated by the
Secretary.’’.
SEC. 1505. FUNDING OF DAIRY PROMOTION AND RESEARCH PROGRAM.

(a) DEFINITIONS.—Section 111 of the Dairy Production Stabilization Act of 1983 (7 U.S.C. 4502) is amended—
(1) in subsection (k), by striking ‘‘and’’ at the end;
(2) in subsection (l), by striking the period at the end
and inserting a semicolon; and
(3) by adding at the end the following:
‘‘(m) the term ‘imported dairy product’ means any dairy
product that is imported into the United States (as defined
in subsection (l)), including dairy products imported into the
United States in the form of—
‘‘(1) milk, cream, and fresh and dried dairy products;
‘‘(2) butter and butterfat mixtures;
‘‘(3) cheese; and
‘‘(4) casein and mixtures;
‘‘(n) the term ‘importer’ means a person that imports an
imported dairy product into the United States; and
‘‘(o) the term ‘Customs’ means the United States Customs
Service.’’.

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(b) REPRESENTATION OF IMPORTERS ON BOARD.—Section 113(b)
of the Dairy Production Stabilization Act of 1983 (7 U.S.C. 4504(b))
is amended—
(1) by inserting ‘‘NATIONAL DAIRY PROMOTION AND
RESEARCH BOARD.—’’ after ‘‘(b)’’;
(2) by designating the first through ninth sentences as
paragraphs (1) through (5) and paragraphs (7) through (10),
respectively, and indenting the paragraphs appropriately;
(3) in paragraph (2) (as so designated), by striking ‘‘Members’’ and inserting ‘‘Except as provided in paragraph (6), the
members’’;
(4) by inserting after paragraph (5) (as so designated) the
following:
‘‘(6) IMPORTERS.—
‘‘(A) INITIAL REPRESENTATION.—In making initial
appointments to the Board of importer representatives,
the Secretary shall appoint 2 members who represent
importers of dairy products and are subject to assessments
under the order.
‘‘(B) SUBSEQUENT REPRESENTATION.—At least once
every 3 years after the initial appointment of importer
representatives under subparagraph (A), the Secretary
shall review the average volume of domestic production
of dairy products compared to the average volume of
imports of dairy products into the United States during
the previous 3 years and, on the basis of that review,
shall reapportion importer representation on the Board
to reflect the proportional share of the United States
market by domestic production and imported dairy products.
‘‘(C) ADDITIONAL MEMBERS; NOMINATIONS.—The members appointed under this paragraph—
‘‘(i) shall be in addition to the total number of
members appointed under paragraph (2); and
‘‘(ii) shall be appointed from nominations submitted by importers under such procedures as the Secretary determines to be appropriate.’’; and
(5) in paragraph (8) (as so designated), by striking ‘‘is
produced’’ and inserting ‘‘is produced as well as importers of
dairy products’’.
(c) BUDGETS.—Section 113(e) of the Dairy Production Stabilization Act of 1983 (7 U.S.C. 4504(e)) is amended—
(1) by striking ‘‘(e)’’ and inserting:
‘‘(e) BUDGETS.—
‘‘(1) PREPARATION AND SUBMISSION.—’’;
(2) by striking the last sentence; and
(3) by adding at the end the following:
‘‘(2) FOREIGN MARKET EFFORTS.—The order shall authorize
the Board to expend in the maintenance and expansion of
foreign markets an amount not to exceed the amount collected
from United States producers for a fiscal year. Of those funds,
for each of the 2002 through 2007 fiscal years, the Board’s
budget may provide for the expenditure of revenues available
to the Board to develop international markets for, and to promote within such markets, the consumption of dairy products
produced or manufactured in the United States.’’.

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(d) IMPORTER ASSESSMENT.—Section 113(g) of the Dairy Production Stabilization Act of 1983 (7 U.S.C. 4504(g)) is amended—
(1) by inserting ‘‘ASSESSMENTS.—’’ after ‘‘(g)’’;
(2) by designating the first through fifth sentences as paragraphs (1) through (5), respectively, and indenting appropriately;
(3) in paragraph (3) (as so designated)—
(A) by inserting ‘‘for milk produced in the United States
and imported dairy products’’ after ‘‘The rate of assessment’’; and
(B) by inserting before the period at the end the following: ‘‘, as determined by the Secretary’’; and
(4) by adding at the end the following:
‘‘(6) IMPORTERS.—
‘‘(A) IN GENERAL.—The order shall provide that each
importer of imported dairy products shall pay an assessment to the Board in the manner prescribed by the order.
‘‘(B) TIME FOR PAYMENT.—The assessment on imported
dairy products shall be paid by the importer to Customs
at the time the entry documents are filed with Customs.
Customs shall remit the assessments to the Board. For
purposes of this subparagraph, the term ‘importer’ includes
persons who hold title to foreign-produced dairy products
immediately upon release by Customs, as well as persons
who act on behalf of others, as agents, brokers, or consignees, to secure the release of dairy products from Customs.
‘‘(C) USE OF ASSESSMENTS ON IMPORTED DAIRY PRODUCTS.—Assessments collected on imported dairy products
shall not be used for foreign market promotion.’’.
(e) RECORDS.—Section 113(k) of the Dairy Production Stabilization Act of 1983 (7 U.S.C. 4504(k)) is amended in the first sentence
by striking ‘‘person receiving’’ and inserting ‘‘importer of imported
dairy products, each person receiving’’.
(f) IMPORTER ELIGIBILITY TO VOTE IN REFERENDUM.—Section
116(b) of the Dairy Promotion Stabilization Act of 1983 (7 U.S.C.
4507(b)) is amended—
(1) in the first sentence—
(A) by inserting after ‘‘of producers’’ the following: ‘‘and
importers’’; and
(B) by inserting after ‘‘the producers’’ the following:
‘‘and importers’’; and
(2) in the second sentence, by inserting after ‘‘commercial
use’’ the following: ‘‘and importers voting in the referendum
(who have been engaged in the importation of dairy products
during the same representative period, as determined by the
Secretary)’’.
(g) ORDER IMPLEMENTATION AND INTERNATIONAL TRADE
OBLIGATIONS.—Section 112 of the Dairy Promotion Stabilization
Act of 1983 (7 U.S.C. 4503) is amended by adding at the end
the following:
‘‘(d) ORDER IMPLEMENTATION AND INTERNATIONAL TRADE
OBLIGATIONS.—The Secretary, in consultation with the United
States Trade Representative, shall ensure that the order is implemented in a manner consistent with the international trade obligations of the Federal Government.’’.

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(h) CONFORMING AMENDMENTS TO REFLECT ADDITION OF
IMPORTERS.—The Dairy Production Stabilization Act of 1983 is
amended—
(1) in section 110(b) (7 U.S.C. 4501(b))—
(A) in the first sentence—
(i) by inserting after ‘‘commercial use’’ the following: ‘‘and on imported dairy products’’; and
(ii) by striking ‘‘products produced in the United
States.’’ and inserting ‘‘products.’’; and
(B) in the second sentence, by inserting after ‘‘produce
milk’’ the following: ‘‘or the right of any person to import
dairy products’’; and
(2) in section 111(d) (7 U.S.C. 4502(d)), by striking ‘‘produced in the United States’’.
SEC. 1506. FLUID MILK PROMOTION.

(a) DEFINITION OF FLUID MILK PRODUCT.—Section 1999C of
the Fluid Milk Promotion Act of 1990 (7 U.S.C. 6402) is amended
by striking paragraph (3) and inserting the following:
‘‘(3) FLUID MILK PRODUCT.—The term ‘fluid milk product’
has the meaning given the term in—
‘‘(A) section 1000.15 of title 7, Code of Federal Regulations, subject to such amendments as may be made by
the Secretary; or
‘‘(B) any successor regulation.’’.
(b) DEFINITION OF FLUID MILK PROCESSOR.—Section 1999C(4)
of the Fluid Milk Promotion Act of 1990 (7 U.S.C. 6402(4)) is
amended by striking ‘‘500,000 pounds of fluid milk products in
consumer-type packages per month’’ and inserting ‘‘3,000,000
pounds of fluid milk products in consumer-type packages per month
(excluding products delivered directly to the place of residence of
a consumer)’’.
(c) ELIMINATION OF ORDER TERMINATION DATE.—Section 1999O
of the Fluid Milk Promotion Act of 1990 (7 U.S.C. 6414) is
amended—
(1) by striking subsection (a); and
(2) by redesignating subsections (b) and (c) as subsections
(a) and (b), respectively.
7 USC 7983.

Deadline.

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SEC. 1507. STUDY OF NATIONAL DAIRY POLICY.

(a) STUDY REQUIRED.—The Secretary of Agriculture shall conduct a comprehensive economic evaluation of the potential direct
and indirect effects of the various elements of the national dairy
policy, including an examination of the effect of the national dairy
policy on—
(1) farm price stability, farm profitability and viability,
and local rural economies in the United States;
(2) child, senior, and low-income nutrition programs,
including impacts on schools and institutions participating in
the programs, on program recipients, and other factors; and
(3) the wholesale and retail cost of fluid milk, dairy farms,
and milk utilization.
(b) REPORT.—Not later than 1 year after the date of enactment
of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on
Agriculture, Nutrition, and Forestry of the Senate a report
describing the results of the study required by this section.

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(c) NATIONAL DAIRY POLICY DEFINED.—In this section, the term
‘‘national dairy policy’’ means the dairy policy of the United States
as evidenced by the following policies and programs:
(1) Federal milk marketing orders issued under section
8c of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted
with amendments by the Agricultural Marketing Act of 1937.
(2) Interstate dairy compacts (including proposed compacts
described in H.R. 1827 and S. 1157, as introduced in the 107th
Congress).
(3) Over-order premiums and State pricing programs.
(4) Direct payments to milk producers.
(5) Federal milk price support program established under
section 1401.
(6) Export programs regarding milk and dairy products,
such as the dairy export incentive program established under
section 153 of the Food Security Act of 1985 (15 U.S.C. 713a–
14).
SEC. 1508. STUDIES OF EFFECTS OF CHANGES IN APPROACH TO
NATIONAL DAIRY POLICY AND FLUID MILK IDENTITY
STANDARDS.

(a) FEDERAL DAIRY POLICY CHANGES.—The Secretary of Agriculture shall conduct a study of the effects of—
(1) terminating all Federal programs relating to price support and supply management for milk; and
(2) granting the consent of Congress to cooperative efforts
by States to manage milk prices and supply.
(b) FLUID MILK IDENTITY STANDARDS.—The Secretary shall conduct a study of the effects of including in the standard of identity
for fluid milk a required minimum protein content that is commensurate with the average nonfat solids content of bovine milk produced in the United States.
(c) REPORTS.—Not later than 1 year after the date of enactment
of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on
Agriculture, Nutrition, and Forestry of the Senate a report
describing the results of the studies required by this section.

7 USC 7984.

Deadline.

Subtitle F—Administration
SEC. 1601. ADMINISTRATION GENERALLY.

7 USC 7991.

(a) USE OF COMMODITY CREDIT CORPORATION.—The Secretary
shall use the funds, facilities, and authorities of the Commodity
Credit Corporation to carry out this title.
(b) DETERMINATIONS BY SECRETARY.—A determination made
by the Secretary under this title shall be final and conclusive.
(c) REGULATIONS.—
(1) IN GENERAL.—Not later than 90 days after the date
of the enactment of this Act, the Secretary and the Commodity
Credit Corporation, as appropriate, shall promulgate such regulations as are necessary to implement this title.
(2) PROCEDURE.—The promulgation of the regulations and
administration of this title shall be made without regard to—
(A) chapter 35 of title 44, United States Code (commonly know as the ‘‘Paperwork Reduction Act’’);

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Regulations.

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(B) the Statement of Policy of the Secretary of Agriculture effective July 24, 1971 (36 Fed. Reg. 13804),
relating to notices of proposed rulemaking and public
participation in rulemaking; and
(C) the notice and comment provisions of section 553
of title 5, United States Code.
(3) CONGRESSIONAL REVIEW OF AGENCY RULEMAKING.—In
carrying out this subsection, the Secretary shall use the
authority provided under section 808 of title 5, United States
Code.
(d) TREATMENT OF ADVANCE PAYMENT OPTION.—The protection
that was afforded producers that had an option to elect to accelerate
the receipt of any payment under a production flexibility contract
payable under the Federal Agriculture Improvement and Reform
Act of 1996, as provided by section 525 of Public 106–170 (113
Stat. 1928; 7 U.S.C. 7212 note), shall also apply to the option
to receive—
(1) the advance payment of direct payments and countercyclical payments under subtitle A and subtitle C; and
(2) the single payment of compensation for eligible peanut
quota holders under section 1310.
(e) ADJUSTMENT AUTHORITY RELATED TO URUGUAY ROUND
COMPLIANCE.—
(1) REQUIRED DETERMINATION; ADJUSTMENT.—If the Secretary determines that expenditures under subtitles A through
E that are subject to the total allowable domestic support
levels under the Uruguay Round Agreements (as defined in
section 2 of the Uruguay Round Agreements Act (19 U.S.C.
3501)), as in effect on the date of enactment of this Act, will
exceed such allowable levels for any applicable reporting period,
the Secretary shall, to the maximum extent practicable, make
adjustments in the amount of such expenditures during that
period to ensure that such expenditures do not exceed such
allowable levels.
(2) CONGRESSIONAL NOTIFICATION.—Before making any
adjustment under paragraph (1), the Secretary shall submit
to the Committee on Agriculture, Nutrition, and Forestry of
the Senate and the Committee on Agriculture of the House
of Representatives a report describing the determination made
under that paragraph and the extent of the adjustment to
be made.
7 USC 7992.

SEC. 1602. SUSPENSION OF PERMANENT PRICE SUPPORT AUTHORITY.

(a) AGRICULTURAL ADJUSTMENT ACT OF 1938.—The following
provisions of the Agricultural Adjustment Act of 1938 shall not
be applicable to the 2002 through 2007 crops of covered commodities, peanuts, and sugar and shall not be applicable to milk during
the period beginning on the date of enactment of this Act through
December 31, 2007:
(1) Parts II through V of subtitle B of title III (7 U.S.C.
1326–1351).
(2) In the case of upland cotton, section 377 (7 U.S.C.
1377).
(3) Subtitle D of title III (7 U.S.C. 1379a–1379j).
(4) Title IV (7 U.S.C. 1401–1407).
(b) AGRICULTURAL ACT OF 1949.—The following provisions of
the Agricultural Act of 1949 shall not be applicable to the 2002

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through 2007 crops of covered commodities, peanuts, and sugar
and shall not be applicable to milk during the period beginning
on the date of enactment of this Act and through December 31,
2007:
(1) Section 101 (7 U.S.C. 1441).
(2) Section 103(a) (7 U.S.C. 1444(a)).
(3) Section 105 (7 U.S.C. 1444b).
(4) Section 107 (7 U.S.C. 1445a).
(5) Section 110 (7 U.S.C. 1445e).
(6) Section 112 (7 U.S.C. 1445g).
(7) Section 115 (7 U.S.C. 1445k).
(8) Section 201 (7 U.S.C. 1446).
(9) Title III (7 U.S.C. 1447–1449).
(10) Title IV (7 U.S.C. 1421–1433d), other than sections
404, 412, and 416 (7 U.S.C. 1424, 1429, and 1431).
(11) Title V (7 U.S.C. 1461–1469).
(12) Title VI (7 U.S.C. 1471–1471j).
(c) SUSPENSION OF CERTAIN QUOTA PROVISIONS.—The joint resolution entitled ‘‘A joint resolution relating to corn and wheat marketing quotas under the Agricultural Adjustment Act of 1938, as
amended’’, approved May 26, 1941 (7 U.S.C. 1330 and 1340), shall
not be applicable to the crops of wheat planted for harvest in
the calendar years 2002 through 2007.
(d) CONFORMING AMENDMENT.—Section 171(a)(1) of the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C.
7301(a)(1)) is amended by striking ‘‘2002’’ the first place appears
and inserting ‘‘2001’’.
SEC. 1603. PAYMENT LIMITATIONS.

(a) LIMITATION ON AMOUNTS RECEIVED.—Section 1001 of the
Food Security Act of 1985 (7 U.S.C. 1308) is amended by striking
the section heading, ‘‘SEC. 1001.’’, and all that follows through
the end of paragraph (4) and inserting the following:
‘‘SEC. 1001. PAYMENT LIMITATIONS.

‘‘(a) DEFINITIONS.—In this section:
‘‘(1) COVERED COMMODITY.—The term ‘covered commodity’
has the meaning given that term in section 1001 of the Farm
Security and Rural Investment Act of 2002.
‘‘(2) LOAN COMMODITY.—The term ‘loan commodity’ has
the meaning given that term in section 1001 of the Farm
Security and Rural Investment Act of 2002, except that the
term does not include wool, mohair, or honey.
‘‘(3) SECRETARY.—The term ‘Secretary’ means the Secretary
of Agriculture.
‘‘(b) LIMITATION ON DIRECT PAYMENTS.—
‘‘(1) COVERED COMMODITIES.—The total amount of direct
payments made to a person during any crop year under subtitle
A of title I of the Farm Security and Rural Investment Act
of 2002 for 1 or more covered commodities may not exceed
$40,000.
‘‘(2) PEANUTS.—The total amount of direct payments made
to a person during any crop year under subtitle C of title
I of the Farm Security and Rural Investment Act of 2002
may not exceed $40,000.
‘‘(c) LIMITATION ON COUNTER-CYCLICAL PAYMENTS.—
‘‘(1) COVERED COMMODITIES.—The total amount of countercyclical payments made to a person during any crop year under

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subtitle A of title I of the Farm Security and Rural Investment
Act of 2002 for 1 or more covered commodities may not exceed
$65,000.
‘‘(2) PEANUTS.—The total amount of counter-cyclical payments made to a person during any crop year under subtitle
C of title I of the Farm Security and Rural Investment Act
of 2002 may not exceed $65,000.
‘‘(d) LIMITATION ON MARKETING LOAN GAINS AND LOAN DEFICIENCY PAYMENTS.—
‘‘(1) LOAN COMMODITIES.—The total amount of the following
gains and payments that a person may receive during any
crop year may not exceed $75,000:
‘‘(A) Any gain realized by a producer from repaying
a marketing assistance loan for 1 or more loan commodities
under subtitle B of title I of the Farm Security and Rural
Investment Act of 2002 at a lower level than the original
loan rate established for the loan commodity under that
subtitle.
‘‘(B) Any loan deficiency payments received for 1 or
more loan commodities under that subtitle.
‘‘(2) OTHER COMMODITIES.—The total amount of the following gains and payments that a person may receive during
any crop year may not exceed $75,000:
‘‘(A) Any gain realized by a producer from repaying
a marketing assistance loan for peanuts, wool, mohair,
or honey under subtitle B or C of title I of the Farm
Security and Rural Investment Act of 2002 at a lower
level than the original loan rate established for the commodity under those subtitles.
‘‘(B) Any loan deficiency payments received for peanuts,
wool, mohair, and honey under those subtitles.’’.
(b) CLERICAL AND CONFORMING AMENDMENTS TO SECTION
1001.—Section 1001 of the Food Security Act of 1985 (7 U.S.C.
1308) is amended—
(1) in paragraph (5)—
(A) by striking ‘‘(5)’’ and inserting ‘‘(e) DEFINITION OF
PERSON.—’’
(B) by redesignating subparagraphs (A) through (E)
as paragraphs (1) through (5), respectively;
(C) in paragraph (1), as so redesignated—
(i) by redesignating clauses (i) and (ii) as subparagraphs (A) and (B), respectively; and
(ii) by striking the second sentence; and
(D) in paragraph (2), as so redesignated—
(i) by redesignating clause (i) as subparagraph (A)
and, in such subparagraph (as so redesignated)—
(I) by striking ‘‘subparagraph (A), subject to
clause (ii)’’ and inserting ‘‘paragraph (1), subject
to subparagraph (B)’’; and
(II) by redesignating subclauses (I), (II), and
(III), as clauses (i), (ii), and (iii), respectively;
(ii) by redesignating clause (ii) as subparagraph
(B) and, in such subparagraph (as so redesignated),
by redesignating subclauses (I), (II), and (III), as
clauses (i), (ii), and (iii), respectively; and
(iii) by redesignating clause (iii) as subparagraph
(C) and, in such subparagraph (as so redesignated)—

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(I) by striking ‘‘as described in paragraphs
(1) and (2)’’ and inserting ‘‘as described in subsections (b), (c), and (d)’’; and
(II) by redesignating subclauses (I) and (II)
as clauses (i) and (ii), respectively;
(2) in paragraph (6), by striking ‘‘(6)’’ and inserting ‘‘(f)
PUBLIC SCHOOLS.—’’; and
(3) in paragraph (7), by striking ‘‘(7)’’ and inserting ‘‘(g)
TIME LIMITS; RELIANCE.—’’.
(c) CONFORMING AMENDMENTS TO OTHER LAWS.—
(1) Section 1001A of the Food Security Act of 1985 (7
U.S.C. 1308–1) is amended—
(A) in subsections (a)(1) and (b)(2)(B), by striking ‘‘section
1001(5)(B)(i)(II)’’
and
inserting
‘‘section
1001(e)(2)(A)(ii)’’; and
(B) in subsections (a)(1) and (b)(1), by striking ‘‘section
1001(5)(B)(i)’’ and inserting ‘‘section 1001(e)(2)(A)’’; and
(2) Section 1001B of the Food Security Act of 1985 (7
U.S.C. 1308–2) is amended by striking ‘‘as described in paragraphs (1) and (2)’’ and inserting ‘‘as described in subsections
(b), (c), and (d)’’.
(3) Section 1001C(a) of the Food Security Act of 1985 (7
U.S.C. 1308–3(a)) is amended by inserting ‘‘title I of the Farm
Security and Rural Investment Act of 2002,’’ after ‘‘made available under’’.
(d) TRANSITION.—Section 1001 of the Food Security Act of 1985
(7 U.S.C. 1308), as in effect on the day before the date of the
enactment of this Act, shall continue to apply with respect to
the 2001 crop of any covered commodity.
SEC. 1604. ADJUSTED GROSS INCOME LIMITATION.

The Food Security Act of 1985 is amended—
(1) by redesignating section 1001D (7 U.S.C. 1308–4) and
section 1001E (7 U.S.C. 1308–5) as sections 1001E and 1001F,
respectively; and
(2) by inserting after section 1001C (7 U.S.C. 1308–3) the
following:
‘‘SEC. 1001D. ADJUSTED GROSS INCOME LIMITATION.

7 USC 1308–3a.

‘‘(a) DEFINITION OF AVERAGE ADJUSTED GROSS INCOME.—
‘‘(1) IN GENERAL.—In this section, the term ‘average
adjusted gross income’, with respect to an individual or entity
(for purposes of this section, as defined in section
1001(e)(2)(A)(ii)), means the 3-year average of the adjusted
gross income or comparable measure of the individual or entity
over the 3 preceding tax years, as determined by the Secretary.
‘‘(2) SPECIAL RULES FOR CERTAIN INDIVIDUALS AND ENTITIES.—In the case of an entity that is not required to file
a Federal income tax return or an individual or entity that
did not have taxable income in 1 or more of the tax years
used to determine the average under paragraph (1), the Secretary shall provide, by regulation, a method for determining
the average adjusted gross income of the individual or entity
for purposes of this section.
‘‘(b) LIMITATION.—
‘‘(1) IN GENERAL.—Notwithstanding any other provision of
law, an individual or entity shall not be eligible to receive
any benefit described in paragraph (2) during a crop year

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if the average adjusted gross income of the individual or entity
exceeds $2,500,000, unless not less than 75 percent of the
average adjusted gross income of the individual or entity is
derived from farming, ranching, or forestry operations, as determined by the Secretary.
‘‘(2) COVERED BENEFITS.—Paragraph (1) applies with
respect to the following:
‘‘(A) A direct payment or counter-cyclical payment
under subtitle A or C of title I of the Farm Security
and Rural Investment Act of 2002.
‘‘(B) A marketing loan gain or payment described in
section 1001(d) of this Act.
‘‘(C) A payment under any program under title XII
of this Act or title II of the Farm Security and Rural
Investment Act of 2002.
‘‘(c) CERTIFICATION.—To comply with the limitation under subsection (b), an individual or entity shall provide to the Secretary—
‘‘(1) a certification by a certified public accountant or
another third party that is acceptable to the Secretary that
the average adjusted gross income of the individual or entity
does not exceed the limitation specified in that subsection;
or
‘‘(2) information and documentation regarding the adjusted
gross income of the individual or entity through other procedures established by the Secretary.
‘‘(d) COMMENSURATE REDUCTION.—In the case of a benefit
described in subsection (b)(2) made in a crop year to an entity,
general partnership, or joint venture, the amount of the benefit
shall be reduced by an amount that is commensurate with the
direct and indirect ownership interest in the entity, general partnership, or joint venture of each individual who has an average
adjusted gross income in excess of the limitation specified in subsection (b) for the average of the 3 preceding crop years.
‘‘(e) EFFECTIVE PERIOD.—This section shall apply only during
the 2003 through 2007 crop years.’’.
7 USC 7993.

SEC. 1605. COMMISSION ON APPLICATION OF PAYMENT LIMITATIONS.

(a) ESTABLISHMENT.—There is established a commission to be
known as the ‘‘Commission on the Application of Payment Limitations for Agriculture’’ (referred to in this section as the ‘‘Commission’’).
(b) DUTIES.—The Commission shall conduct a study on the
potential impacts of further payment limitations on the receipt
of direct payments, counter-cyclical payments, and marketing loan
gains and loan deficiency payments on—
(1) farm income;
(2) land values;
(3) rural communities;
(4) agribusiness infrastructure;
(5) planting decisions of producers affected; and
(6) supply and prices of covered commodities, loan commodities, specialty crops (including fruits and vegetables), and other
agricultural commodities.
(c) MEMBERSHIP.—
(1) COMPOSITION.—The Commission shall be composed of
10 members as follows:
(A) 3 members appointed by the Secretary.

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(B) 3 members appointed by the Committee on Agriculture, Nutrition, and Forestry of the Senate.
(C) 3 members appointed by the Committee on Agriculture of the House of Representatives.
(D) The Chief Economist of the Department of Agriculture.
(2) FEDERAL GOVERNMENT EMPLOYMENT.—The membership
of the Commission may include 1 or more employees of the
Department of Agriculture or other Federal agencies.
(3) DATE OF APPOINTMENTS.—The appointment of a member
of the Commission shall be made not later than 60 days after
the date of enactment of this Act.
(4) TERM; VACANCIES.—
(A) TERM.—A member shall be appointed for the life
of the Commission.
(B) VACANCIES.—A vacancy on the Commission—
(i) shall not affect the powers of the Commission;
and
(ii) shall be filled in the same manner as the
original appointment was made.
(5) INITIAL MEETING.—Not later than 30 days after the
date on which all members of the Commission have been
appointed, the Commission shall hold the initial meeting of
the Commission.
(d) QUORUM.—A majority of the members of the Commission
shall constitute a quorum for the transaction of business, but a
lesser number of members may hold hearings.
(e) CHAIRPERSON.—The Secretary shall appoint 1 of the members of the Commission to serve as Chairperson of the Commission.
(f) REPORT.—Not later than 1 year after the date of enactment
of this Act, the Commission shall submit to the President, the
Committee on Agriculture of the House of Representatives, and
the Committee on Agriculture, Nutrition, and Forestry of the Senate
a report containing the results of the study required by subsection
(b), including such recommendations as the Commission considers
appropriate.
(g) HEARINGS.—The Commission may hold such hearings, meet
and act at such times and places, take such testimony, and receive
such evidence as the Commission considers advisable to carry out
this section.
(h) INFORMATION FROM FEDERAL AGENCIES.—The Commission
may secure directly from a Federal agency such information as
the Commission considers necessary to carry out this section. On
request of the Chairperson of the Commission, the head of the
agency shall provide the information to the Commission.
(i) POSTAL SERVICES.—The Commission may use the United
States mails in the same manner and under the same conditions
as other agencies of the Federal Government.
(j) ASSISTANCE FROM SECRETARY.—The Secretary may provide
to the Commission appropriate office space and such reasonable
administrative and support services as the Commission may
request.
(k) COMPENSATION OF MEMBERS.—
(1) NON-FEDERAL EMPLOYEES.—A member of the Commission who is not an officer or employee of the Federal Government shall be compensated at a rate equal to the daily equivalent of the annual rate of basic pay prescribed for level IV

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of the Executive Schedule under section 5315 of title 5, United
States Code, for each day (including travel time) during which
the member is engaged in the performance of the duties of
the Commission.
(2) FEDERAL EMPLOYEES.—A member of the Commission
who is an officer or employee of the Federal Government shall
serve without compensation in addition to the compensation
received for the services of the member as an officer or employee
of the Federal Government.
(3) TRAVEL EXPENSES.—A member of the Commission shall
be allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for an employee of an agency under
subchapter I of chapter 57 of title 5, United States Code,
while away from the home or regular place of business of
the member in the performance of the duties of the Commission.
(l) FEDERAL ADVISORY COMMITTEE ACT.—The Federal Advisory
Committee Act (5 U.S.C. App.) shall not apply to the Commission
or any proceeding of the Commission.
SEC. 1606. ADJUSTMENTS OF LOANS.

Section 162(b) of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7282(b)) is amended by striking
‘‘this title’’ and inserting ‘‘this title and title I of the Farm Security
and Rural Investment Act of 2002’’.
SEC. 1607. PERSONAL LIABILITY OF PRODUCERS FOR DEFICIENCIES.

Section 164 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7284) is amended by striking ‘‘this
title’’ each places it appears and inserting ‘‘this title and title
I of the Farm Security and Rural Investment Act of 2002’’.
SEC. 1608. EXTENSION OF EXISTING ADMINISTRATIVE AUTHORITY
REGARDING LOANS.

Section 166 of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7286) is amended—
(1) in subsection (a), by striking ‘‘subtitle C’’ and inserting
‘‘subtitle C of this title and subtitle B and C of title I of
the Farm Security and Rural Investment Act of 2002’’; and
(2) in subsection (c)(1), by striking ‘‘subtitle C’’ and
inserting ‘‘subtitle C of this title and subtitle B and C of
title I of the Farm Security and Rural Investment Act of 2002’’.
SEC. 1609. COMMODITY CREDIT CORPORATION INVENTORY.

Section 5 of the Commodity Credit Corporation Charter Act
(15 U.S.C. 714c) is amended in the last sentence by inserting
before the period at the end the following: ‘‘(including, at the option
of the Corporation, the use of private sector entities)’’.
SEC. 1610. RESERVE STOCK LEVEL.

Section 301(b)(14)(C) of the Agricultural Adjustment Act of
1938 (7 U.S.C. 1301(b)(14)(C)) is amended—
(1) in clause (i), by striking ‘‘100,000,000’’ and inserting
‘‘60,000,000’’; and
(2) in clause (ii), by striking ‘‘15 percent’’ and inserting
‘‘10 percent’’.
SEC. 1611. FARM RECONSTITUTIONS.

(a) IN GENERAL.—Section 316(a)(1)(A)(ii) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1314b(a)(1)(A)(ii)) is amended

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by adding at the end the following: ‘‘Notwithstanding any other
provision of law, for the 2002 crop only, the Secretary shall allow
special farm reconstitutions, in lieu of lease and transfer of allotments and quotas, under this section, in accordance with such
conditions as are established by the Secretary.’’.
(b) STUDY.—
(1) IN GENERAL.—The Secretary shall conduct a study on
the effects on the limitation on producers to move quota to
a farm other than the farm to which the quota was initially
assigned under part I of subtitle B of title III of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1311 et seq.).
(2) REPORT.—Not later than 90 days after the date of
enactment of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and
the Committee on Agriculture, Nutrition, and Forestry of the
Senate a report on the results of the study.
SEC. 1612. ASSIGNMENT OF PAYMENTS.

7 USC 7994.

Deadline.

7 USC 7995.

The provisions of section 8(g) of the Soil Conservation and
Domestic Allotment Act (16 U.S.C. 590h(g)), relating to assignment
of payments, shall apply to payments made under the authority
of this Act. The producer making the assignment, or the assignee,
shall provide the Secretary with notice, in such manner as the
Secretary may require, of any assignment made under this section.
SEC. 1613. EQUITABLE RELIEF FROM INELIGIBILITY FOR LOANS, PAYMENTS, OR OTHER BENEFITS.

7 USC 7996.

(a) DEFINITIONS.—In this section:
(1) AGRICULTURAL COMMODITY.—The term ‘‘agricultural
commodity’’ means any agricultural commodity, food, feed, fiber,
or livestock that is subject to a covered program.
(2) COVERED PROGRAM.—
(A) IN GENERAL.—The term ‘‘covered program’’ means—
(i) a program administered by the Secretary under
which price or income support, or production or market
loss assistance, is provided to producers of agricultural
commodities; and
(ii) a conservation program administered by the
Secretary.
(B) EXCLUSIONS.—The term ‘‘covered program’’ does
not include—
(i) an agricultural credit program carried out under
the Consolidated Farm and Rural Development Act
(7 U.S.C. 1921 et seq.); or
(ii) the crop insurance program carried out under
the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.).
(3) PARTICIPANT.—The term ‘‘participant’’ means a participant in a covered program.
(4) STATE CONSERVATIONIST.—The term ‘‘State Conservationist’’ means the State Conservationist with respect to a
program administered by the Natural Resources Conservation
Service.
(5) STATE DIRECTOR.—The term ‘‘State Director’’ means
the State Executive Director of the Farm Service Agency with
respect to a program administered by the Farm Service Agency.
(b) EQUITABLE RELIEF.—The Secretary may provide relief to
any participant that is determined to be not in compliance with
the requirements of a covered program, and therefore ineligible

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for a loan, payment, or other benefit under the covered program,
if the participant—
(1) acting in good faith, relied on the action or advice
of the Secretary (including any authorized representative of
the Secretary) to the detriment of the participant; or
(2) failed to comply fully with the requirements of the
covered program, but made a good faith effort to comply with
the requirements.
(c) FORMS OF RELIEF.—The Secretary may authorize a participant in a covered program to—
(1) retain loans, payments, or other benefits received under
the covered program;
(2) continue to receive loans, payments, and other benefits
under the covered program;
(3) continue to participate, in whole or in part, under
any contract executed under the covered program;
(4) in the case of a conservation program, reenroll all
or part of the land covered by the program; and
(5) receive such other equitable relief as the Secretary
determines to be appropriate.
(d) REMEDIAL ACTION.—As a condition of receiving relief under
this section, the Secretary may require the participant to take
actions designed to remedy any failure to comply with the covered
program.
(e) EQUITABLE RELIEF BY STATE DIRECTORS AND STATE CONSERVATIONISTS.—
(1) IN GENERAL.—A State Director, in the case of programs
administered by the State Director, and the State Conservationist, in the case of programs administered by the State
Conservationist, may grant relief to a participant in accordance
with subsections (b) through (d) if—
(A) the amount of loans, payments, and benefits for
which relief will be provided to the participant under this
subsection is less than $20,000;
(B) the total amount of loans, payments, and benefits
for which relief has been previously provided to the participant under this subsection is not more than $5,000; and
(C) the total amount of loans, payments, and benefits
for which relief is provided to similarly situated participants under this subsection is not more than $1,000,000,
as determined by the Secretary.
(2) CONSULTATION, APPROVAL, AND REVERSAL.—The decision
by a State Director or State Conservationist to grant relief
under this subsection—
(A) shall not require prior approval by the Administrator of the Farm Service Agency, the Chief of the Natural
Resources Conservation Service, or any other officer or
employee of the Agency or Service;
(B) shall be made only after consultation with, and
the approval of, the Office of General Counsel of the Department of Agriculture; and
(C) is subject to reversal only by the Secretary (who
may not delegate the reversal authority).
(3) NONAPPLICABILITY.—The authority of a State Director
or State Conservationist under this subsection does not apply
to the administration of—
(A) payment limitations under—

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(i) sections 1001 through 1001F of the Food Security Act of 1985 (7 U.S.C. 1308 et seq.); or
(ii) a conservation program administered by the
Secretary.
(B) highly erodible land and wetland conservation
requirements under subtitle B or C of title XII of the
Food Security Act of 1985 (16 U.S.C. 3811 et seq.).
(4) OTHER AUTHORITY.—The authority provided to a State
Director and State Conservationist under this subsection is
in addition to any other applicable authority and does not
limit other authority provided by law or the Secretary.
(f) JUDICIAL REVIEW.—A discretionary decision by the Secretary,
the State Director, or the State Conservationist under this section
shall be final, and shall not be subject to review under chapter
7 of title 5, United States Code.
(g) REPORTS.—Not later than February 1 of each year, the
Secretary shall submit to the Committee on Agriculture of the
House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes for the
previous calendar year—
(1) the number of requests for equitable relief under subsections (b) and (e) and the disposition of the requests; and
(2) the number of requests for equitable relief under section
278(d) of the Department of Agriculture Reorganization Act
of 1994 (7 U.S.C. 6998(d)) and the disposition of the requests.
(h) RELATIONSHIP TO OTHER LAW.—The authority provided in
this section is in addition to any other authority provided in this
or any other Act.
(i) FINALITY RULE.—Section 281(a) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 7001(a)) is amended—
(1) by striking ‘‘Consolidated Farm Service Agency’’ each
place it appears and inserting ‘‘Farm Service Agency’’;
(2) in paragraph (1)—
(A) by striking ‘‘This subsection’’ and inserting the
following:
‘‘(A) IN GENERAL.—Except as provided in subparagraph
(B), this subsection’’; and
(B) by adding at the end the following:
‘‘(B) NONAPPLICABILITY.—This subsection does not
apply to—
‘‘(i) a function performed under section 376 of the
Consolidated Farm and Rural Development Act; or
‘‘(ii) a function performed under a conservation
program administered by the Natural Resources Conservation Service.’’; and
(3) in paragraph (2), by inserting ‘‘, before the end of
the 90-day period,’’ after ‘‘unless the decision’’.
(j) CONFORMING AMENDMENTS.—
(1) Section 326 of the Food and Agriculture Act of 1962
(7 U.S.C. 1339a) is repealed.
(2) Section 278(d) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6998(d)) is amended in the
first sentence by striking ‘‘section 326 of the Food and Agriculture Act of 1962 (7 U.S.C. 1339a)’’ and inserting ‘‘section
1613 of the Farm Security and Rural Investment Act of 2002’’.
(3) Section 1230A of the Food Security Act of 1985 (16
U.S.C. 3830a) is repealed.

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PUBLIC LAW 107–171—MAY 13, 2002

SEC. 1614. TRACKING OF BENEFITS.

As soon as practicable after the date of enactment of this
Act, the Secretary shall establish procedures to track the benefits
provided, directly or indirectly, to individuals and entities under
titles I and II and the amendments made by those titles.
7 USC 7998.

SEC. 1615. ESTIMATES OF NET FARM INCOME.

In each issuance of projections of net farm income, the Secretary
shall include (as determined by the Secretary)—
(1) an estimate of the net farm income earned by commercial producers in the United States; and
(2) an estimate of the net farm income attributable to
commercial producers of each of the following:
(A) Livestock.
(B) Loan commodities.
(C) Agricultural commodities other than loan commodities.
7 USC 7999.

SEC. 1616. AVAILABILITY OF INCENTIVE PAYMENTS FOR CERTAIN PRODUCERS.

(a) INCENTIVE PAYMENTS REQUIRED.—Subject to subsection (b),
the Secretary shall make available a total of $20,000,000 of funds
of the Commodity Credit Corporation during the 2003 through
2005 crop years to provide incentive payments to producers of
hard white wheat.
(b) CONDITIONS ON IMPLEMENTATION.—The Secretary shall
implement subsection (a)—
(1) only with regard to production that meets minimum
quality criteria; and
(2) on not more than 2,000,000 acres or the equivalent
volume of production.
(c) DEMAND FOR WHEAT.—To be eligible to obtain an incentive
payment under subsection (a), a producer shall demonstrate to
the satisfaction of the Secretary that buyers and end-users are
available for the wheat to be covered by the incentive payment.
7 USC 8000.

SEC. 1617. RENEWED AVAILABILITY OF MARKET LOSS ASSISTANCE
AND CERTAIN EMERGENCY ASSISTANCE TO PERSONS
THAT FAILED TO RECEIVE ASSISTANCE UNDER EARLIER
AUTHORITIES.

(a) AUTHORITY TO PROVIDE ASSISTANCE.—The Secretary of Agriculture may use such funds of the Commodity Credit Corporation
as are necessary to provide market loss assistance and other emergency assistance under a provision of law specified in subsection
(c) to persons that, as determined by the Secretary)—
(1) were eligible to receive the assistance under the provision of law; but
(2) did not receive the assistance before October 1, 2001.
(b) LIMITATION.—The amount of assistance provided under a
provision of law specified in subsection (c) and this section to
a person shall not exceed the amount of assistance the person
would have been eligible to receive under the provision had the
claim of the producer under the provision been timely resolved.
(c) COVERED MARKET LOSS ASSISTANCE AUTHORITIES.—The following provisions of law are covered by this section:
(1) Sections 1, 2, 3, 4, and 5 of Public Law 107–25 (115
Stat. 201).

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(2) Sections 805, 806, and 814 of the Agriculture, Rural
Development, Food and Drug Administration, and Related
Agencies Appropriations Act, 2001 (as enacted into law by
Public Law 106–387; 114 Stat. 1549).
(3) Sections 201, 202, 204(a), 204(d), 257, and 259 of the
Agricultural Risk Protection Act of 2000 (Public Law 106–
224; 7 U.S.C. 1421 note).
(4) Sections 802, 803(a), 804, and 805 of the Agriculture,
Rural Development, Food and Drug Administration, and
Related Agencies Appropriations Act, 2000 (Public Law 106–
78; 113 Stat. 1135).
(5) The livestock indemnity program under the heading
‘‘COMMODITY CREDIT CORPORATION FUND’’ in chapter 1 of title
I of the 1999 Emergency Supplemental Appropriations Act
(Public 106–31; 113 Stat. 59).
(6) Section 1111(a) of the Agriculture, Rural Development,
Food and Drug Administration, and Related Agencies Appropriations Act, 1999 (as contained in section 101(a) of division
A of Public Law 105–277; 112 Stat. 2681–44).
SEC. 1618. PRODUCER RETENTION OF ERRONEOUSLY PAID LOAN DEFICIENCY PAYMENTS AND MARKETING LOAN GAINS.

7 USC 8001.

Notwithstanding any other provision of law, the Secretary and
the Commodity Credit Corporation shall not require producers in
Erie County, Pennsylvania, to repay loan deficiency payments and
marketing loan gains erroneously paid or determined to have been
earned by the Commodity Credit Corporation for certain 1998 and
1999 crops under subtitle C of title I of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7231 et seq.).
In the case of a producer who has already made the repayment
on or before the date of the enactment of this Act, the Commodity
Credit Corporation shall reimburse the producer for the full amount
of the repayment.

TITLE II—CONSERVATION
Subtitle A—Conservation Security
SEC. 2001. CONSERVATION SECURITY PROGRAM.

(a) IN GENERAL.—Subtitle D of title XII of the Food Security
Act of 1985 (16 U.S.C. 3830 et seq.) is amended by inserting
after chapter 1 the following:
‘‘CHAPTER 2—CONSERVATION SECURITY AND
FARMLAND PROTECTION
‘‘Subchapter A—Conservation Security Program
‘‘SEC. 1238. DEFINITIONS.

16 USC 3838.

‘‘In this subchapter:
‘‘(1) BASE PAYMENT.—The term ‘base payment’ means an
amount that is—
‘‘(A) determined in accordance with the rate described
in section 1238C(b)(1)(A); and

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‘‘(B) paid to a producer under a conservation security
contract in accordance with clause (i) of subparagraph (C),
(D), or (E) of section 1238C(b)(1), as appropriate.
‘‘(2) BEGINNING FARMER OR RANCHER.—The term ‘beginning
farmer or rancher’ has the meaning given the term under
section 343(a) of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1991(a)).
‘‘(3) CONSERVATION PRACTICE.—The term ‘conservation
practice’ means a conservation farming practice described in
section 1238A(d)(4) that—
‘‘(A) requires planning, implementation, management,
and maintenance; and
‘‘(B) promotes 1 or more of the purposes described
in section 1238A(a).
‘‘(4) CONSERVATION SECURITY CONTRACT.—The term ‘conservation security contract’ means a contract described in section 1238A(e).
‘‘(5) CONSERVATION SECURITY PLAN.—The term ‘conservation security plan’ means a plan described in section 1238A(c).
‘‘(6) CONSERVATION SECURITY PROGRAM.—The term ‘conservation security program’ means the program established
under section 1238A(a).
‘‘(7) ENHANCED PAYMENT.—The term ‘enhanced payment’
means the amount paid to a producer under a conservation
security contract that is equal to the amount described in
section 1238C(b)(1)(C)(iii).
‘‘(8) NONDEGRADATION STANDARD.—The term ‘nondegradation standard’ means the level of measures required to adequately protect, and prevent degradation of, 1 or more natural
resources, as determined by the Secretary in accordance with
the quality criteria described in handbooks of the Natural
Resources Conservation Service.
‘‘(9) PRODUCER.—
‘‘(A) IN GENERAL.—The term ‘producer’ means an
owner, operator, landlord, tenant, or sharecropper that—
‘‘(i) shares in the risk of producing any crop or
livestock; and
‘‘(ii) is entitled to share in the crop or livestock
available for marketing from a farm (or would have
shared had the crop or livestock been produced).
‘‘(B) HYBRID SEED GROWERS.—In determining whether
a grower of hybrid seed is a producer, the Secretary shall
not take into consideration the existence of a hybrid seed
contract.
‘‘(10) RESOURCE-CONSERVING CROP ROTATION.—The term
‘resource-conserving crop rotation’ means a crop rotation that—
‘‘(A) includes at least 1 resource-conserving crop (as
defined by the Secretary);
‘‘(B) reduces erosion;
‘‘(C) improves soil fertility and tilth;
‘‘(D) interrupts pest cycles; and
‘‘(E) in applicable areas, reduces depletion of soil moisture (or otherwise reduces the need for irrigation).
‘‘(11) RESOURCE MANAGEMENT SYSTEM.—The term ‘resource
management system’ means a system of conservation practices
and management relating to land or water use that is designed
to prevent resource degradation and permit sustained use of

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land, water, and other natural resources, as defined in accordance with the technical guide of the Natural Resources Conservation Service.
‘‘(12) SECRETARY.—The term ‘Secretary’ means the Secretary of Agriculture, acting through the Chief of the Natural
Resources Conservation Service.
‘‘(13) TIER I CONSERVATION SECURITY CONTRACT.—The term
‘Tier I conservation security contract’ means a contract
described in section 1238A(d)(5)(A).
‘‘(14) TIER II CONSERVATION SECURITY CONTRACT.—The term
‘Tier II conservation security contract’ means a contract
described in section 1238A(d)(5)(B).
‘‘(15) TIER III CONSERVATION SECURITY CONTRACT.—The
term ‘Tier III conservation security contract’ means a contract
described in section 1238A(d)(5)(C).
‘‘SEC. 1238A. CONSERVATION SECURITY PROGRAM.

16 USC 3838a.

‘‘(a) IN GENERAL.—The Secretary shall establish and, for each
of fiscal years 2003 through 2007, carry out a conservation security
program to assist producers of agricultural operations in promoting,
as is applicable with respect to land to be enrolled in the program,
conservation and improvement of the quality of soil, water, air,
energy, plant and animal life, and any other conservation purposes,
as determined by the Secretary.
‘‘(b) ELIGIBILITY.—
‘‘(1) ELIGIBLE PRODUCERS.—To be eligible to participate
in the conservation security program (other than to receive
technical assistance under section 1238C(g) for the development
of conservation security contracts), a producer shall—
‘‘(A) develop and submit to the Secretary, and obtain
the approval of the Secretary of, a conservation security
plan that meets the requirements of subsection (c)(1); and
‘‘(B) enter into a conservation security contract with
the Secretary to carry out the conservation security plan.
‘‘(2) ELIGIBLE LAND.—Except as provided in paragraph (3),
private agricultural land (including cropland, grassland, prairie
land, improved pasture land, and rangeland), land under the
jurisdiction of an Indian tribe (as defined by the Secretary),
and forested land that is an incidental part of an agricultural
operation shall be eligible for enrollment in the conservation
security program.
‘‘(3) EXCLUSIONS.—
‘‘(A) CONSERVATION RESERVE PROGRAM.—Land enrolled
in the conservation reserve program under subchapter B
of chapter 1 shall not be eligible for enrollment in the
conservation security program.
‘‘(B) WETLANDS RESERVE PROGRAM.—Land enrolled in
the wetlands reserve program established under subchapter
C of chapter 1 shall not be eligible for enrollment in the
conservation security program.
‘‘(C) GRASSLAND RESERVE PROGRAM.—Land enrolled in
the grassland reserve program established under subchapter C of chapter 2 shall not be eligible for enrollment
in the conservation security program.
‘‘(D) CONVERSION TO CROPLAND.—Land that is used
for crop production after the date of enactment of this
subchapter that had not been planted, considered to be

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planted, or devoted to crop production for at least 4 of
the 6 years preceding that date (except for land enrolled
in the conservation reserve program under subchapter B
of chapter 1) or that has been maintained using longterm crop rotation practices, as determined by the Secretary, shall not be the basis for any payment under the
conservation security program.
‘‘(4) ECONOMIC USES.—The Secretary shall permit a producer to implement, with respect to all eligible land covered
by a conservation security plan, economic uses that—
‘‘(A) maintain the agricultural nature of the land; and
‘‘(B) are consistent with the natural resource and conservation objectives of the conservation security program.
‘‘(c) CONSERVATION SECURITY PLANS.—
‘‘(1) IN GENERAL.—A conservation security plan shall—
‘‘(A) identify the designated land and resources to be
conserved under the conservation security plan;
‘‘(B) describe the tier of conservation security contract,
and the particular conservation practices to be implemented, maintained, or improved, in accordance with subsection (d) on the land covered by the conservation security
contract for the specified term; and
‘‘(C) contain a schedule for the implementation, maintenance, or improvement of the conservation practices
described in the conservation security plan during the term
of the conservation security contract.
‘‘(2) RESOURCE PLANNING.—The Secretary may assist producers that enter into conservation security contracts in developing a comprehensive, long-term strategy for improving and
maintaining all natural resources of the agricultural operation
of the producer.
‘‘(d) CONSERVATION CONTRACTS AND PRACTICES.—
‘‘(1) IN GENERAL.—
‘‘(A) ESTABLISHMENT OF TIERS.—The Secretary shall
establish, and offer to eligible producers, 3 tiers of conservation contracts under which a payment under this subchapter may be received.
‘‘(B) ELIGIBLE CONSERVATION PRACTICES.—
‘‘(i) IN GENERAL.—The Secretary shall make
eligible for payment under a conservation security contract land management, vegetative, and structural
practices.
‘‘(ii) DETERMINATION.—In determining the eligibility of a practice described in clause (i), the Secretary
shall require, to the maximum extent practicable, that
the lowest cost alternatives be used to fulfill the purposes of the conservation security plan, as determined
by the Secretary.
‘‘(2) ON-FARM RESEARCH AND DEMONSTRATION OR PILOT
TESTING.—With respect to land enrolled in the conservation
security program, the Secretary may approve a conservation
security plan that includes—
‘‘(A) on-farm conservation research and demonstration
activities; and
‘‘(B) pilot testing of new technologies or innovative
conservation practices.

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‘‘(3) USE OF HANDBOOK AND GUIDES; STATE AND LOCAL CONSERVATION CONCERNS.—
‘‘(A) USE OF HANDBOOK AND GUIDES.—In determining
eligible conservation practices and the criteria for implementing or maintaining the conservation practices under
the conservation security program, the Secretary shall use
the National Handbook of Conservation Practices of the
Natural Resources Conservation Service.
‘‘(B) STATE AND LOCAL CONSERVATION PRIORITIES.—The
conservation priorities of a State or locality in which an
agricultural operation is situated shall be determined by
the State Conservationist, in consultation with—
‘‘(i) the State technical committee established
under subtitle G; and
‘‘(ii) local agricultural producers and conservation
working groups.
‘‘(4) CONSERVATION PRACTICES.—Conservation practices
that may be implemented by a producer under a conservation
security contract (as appropriate for the agricultural operation
of a producer) include—
‘‘(A) nutrient management;
‘‘(B) integrated pest management;
‘‘(C) water conservation (including through irrigation)
and water quality management;
‘‘(D) grazing, pasture, and rangeland management;
‘‘(E) soil conservation, quality, and residue management;
‘‘(F) invasive species management;
‘‘(G) fish and wildlife habitat conservation, restoration,
and management;
‘‘(H) air quality management;
‘‘(I) energy conservation measures;
‘‘(J) biological resource conservation and regeneration;
‘‘(K) contour farming;
‘‘(L) strip cropping;
‘‘(M) cover cropping;
‘‘(N) controlled rotational grazing;
‘‘(O) resource-conserving crop rotation;
‘‘(P) conversion of portions of cropland from a soildepleting use to a soil-conserving use, including production
of cover crops;
‘‘(Q) partial field conservation practices;
‘‘(R) native grassland and prairie protection and restoration; and
‘‘(S) any other conservation practices that the Secretary
determines to be appropriate and comparable to other conservation practices described in this paragraph.
‘‘(5) TIERS.—Subject to paragraph (6), to carry out this
subsection, the Secretary shall establish the following 3 tiers
of conservation contracts:
‘‘(A) TIER I CONSERVATION SECURITY CONTRACTS.—A
conservation security plan for land enrolled under a Tier
I conservation security contract shall—
‘‘(i) be for a period of 5 years; and
‘‘(ii) include conservation practices appropriate for
the agricultural operation, that, at a minimum (as
determined by the Secretary)—

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‘‘(I) address at least 1 significant resource of
concern for the enrolled portion of the agricultural
operation at a level that meets the appropriate
nondegradation standard; and
‘‘(II) cover active management of conservation
practices that are implemented or maintained
under the conservation security contract.
‘‘(B) TIER II CONSERVATION SECURITY CONTRACTS.—A
conservation security plan for land enrolled under a Tier
II conservation security contract shall—
‘‘(i) be for a period of not less than 5 nor more
than 10 years, as determined by the producer;
‘‘(ii) include conservation practices appropriate for
the agricultural operation, that, at a minimum—
‘‘(I) address at least 1 significant resource of
concern for the entire agricultural operation, as
determined by the Secretary, at a level that meets
the appropriate nondegradation standard; and
‘‘(II) cover active management of conservation
practices that are implemented or maintained
under the conservation security contract.
‘‘(C) TIER III CONSERVATION SECURITY CONTRACTS.—A
conservation security plan for land enrolled under a Tier
III conservation security contract shall—
‘‘(i) be for a period of not less than 5 nor more
than 10 years, as determined by the producer; and
‘‘(ii) include conservation practices appropriate for
the agricultural operation that, at a minimum—
‘‘(I) apply a resource management system that
meets the appropriate nondegradation standard for
all resources of concern of the entire agricultural
operation, as determined by the Secretary; and
‘‘(II) cover active management of conservation
practices that are implemented or maintained
under the conservation security contract.
‘‘(6) MINIMUM REQUIREMENTS.—The minimum requirements for each tier of conservation contracts implemented
under paragraph (5) shall be determined and approved by the
Secretary.
‘‘(e) CONSERVATION SECURITY CONTRACTS.—
‘‘(1) IN GENERAL.—On approval of a conservation security
plan of a producer, the Secretary shall enter into a conservation
security contract with the producer to enroll the land covered
by the conservation security plan in the conservation security
program.
‘‘(2) MODIFICATION.—
‘‘(A) OPTIONAL MODIFICATIONS.—A producer may apply
to the Secretary for a modification of the conservation
security contract of the producer that is consistent with
the purposes of the conservation security program.
‘‘(B) OTHER MODIFICATIONS.—
‘‘(i) IN GENERAL.—The Secretary may, in writing,
require a producer to modify a conservation security
contract before the expiration of the conservation security contract if the Secretary determines that a change
made to the type, size, management, or other aspect
of the agricultural operation of the producer would,

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without the modification of the contract, significantly
interfere with achieving the purposes of the conservation security program.
‘‘(ii) PARTICIPATION IN OTHER PROGRAMS.—If appropriate payment reductions and other adjustments (as
determined by the Secretary) are made to the conservation security contract of a producer, the producer
may—
‘‘(I) simultaneously participate in—
‘‘(aa) the conservation security program;
‘‘(bb) the conservation reserve program
under subchapter B of chapter 1; and
‘‘(cc) the wetlands reserve program under
subchapter C of chapter 1; and
‘‘(II) may remove land enrolled in the conservation security program for enrollment in a program
described in item (bb) or (cc) of subclause (I).
‘‘(3) TERMINATION.—
‘‘(A) OPTIONAL TERMINATION.—A producer may terminate a conservation security contract and retain payments
received under the conservation security contract, if—
‘‘(i) the producer is in full compliance with the
terms and conditions (including any maintenance
requirements) of the conservation security contract as
of the date of the termination; and
‘‘(ii) the Secretary determines that termination of
the contract would not defeat the purposes of the conservation security plan of the producer.
‘‘(B) OTHER TERMINATION.—A producer that is required
to modify a conservation security contract under paragraph
(2)(B)(i) may, in lieu of modifying the contract—
‘‘(i) terminate the conservation security contract;
and
‘‘(ii) retain payments received under the conservation security contract, if the producer has fully complied with the terms and conditions of the conservation
security contract before termination of the contract,
as determined by the Secretary.
‘‘(4) RENEWAL.—
‘‘(A) IN GENERAL.—Except as provided in subparagraph
(B), at the option of a producer, the conservation security
contract of the producer may be renewed for an additional
period of not less than 5 nor more than 10 years.
‘‘(B) TIER I RENEWALS.—In the case of a Tier I conservation security contract of a producer, the producer may
renew the contract only if the producer agrees—
‘‘(i) to apply additional conservation practices that
meet the nondegradation standard on land already
enrolled in the conservation security program; or
‘‘(ii) to adopt new conservation practices with
respect to another portion of the agricultural operation
that address resource concerns and meet the nondegradation standard under the terms of the Tier I conservation security contract.
‘‘(f) NONCOMPLIANCE DUE TO CIRCUMSTANCES BEYOND THE CONTROL OF PRODUCERS.—The Secretary shall include in the conservation security contract a provision, and may permit modification

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of a conservation security contract under subsection (e)(1), to ensure
that a producer shall not be considered in violation of a conservation
security contract for failure to comply with the conservation security
contract due to circumstances beyond the control of the producer,
including a disaster or related condition, as determined by the
Secretary.
16 USC 3838b.

‘‘SEC. 1238B. DUTIES OF PRODUCERS.

‘‘Under a conservation security contract, a producer shall agree,
during the term of the conservation security contract—
‘‘(1) to implement the applicable conservation security plan
approved by the Secretary;
‘‘(2) to maintain, and make available to the Secretary at
such times as the Secretary may request, appropriate records
showing the effective and timely implementation of the conservation security plan;
‘‘(3) not to engage in any activity that would interfere
with the purposes of the conservation security program; and
‘‘(4) on the violation of a term or condition of the conservation security contract—
‘‘(A) if the Secretary determines that the violation warrants termination of the conservation security contract—
‘‘(i) to forfeit all rights to receive payments under
the conservation security contract; and
‘‘(ii) to refund to the Secretary all or a portion
of the payments received by the producer under the
conservation security contract, including any advance
payments and interest on the payments, as determined
by the Secretary; or
‘‘(B) if the Secretary determines that the violation does
not warrant termination of the conservation security contract, to refund to the Secretary, or accept adjustments
to, the payments provided to the producer, as the Secretary
determines to be appropriate.
16 USC 3838c.

‘‘SEC. 1238C. DUTIES OF THE SECRETARY.

‘‘(a) TIMING OF PAYMENTS.—The Secretary shall make payments
under a conservation security contract as soon as practicable after
October 1 of each fiscal year.
‘‘(b) ANNUAL PAYMENTS.—
‘‘(1) CRITERIA FOR DETERMINING AMOUNT OF PAYMENTS.—
‘‘(A) BASE PAYMENT.—A base payment under this paragraph shall be (as determined by the Secretary)—
‘‘(i) the average national per-acre rental rate for
a specific land use during the 2001 crop year; or
‘‘(ii) another appropriate rate for the 2001 crop
year that ensures regional equity.
‘‘(B) PAYMENTS.—A payment for a conservation practice
under this paragraph shall be determined in accordance
with subparagraphs (C) through (E).
‘‘(C) TIER I CONSERVATION SECURITY CONTRACTS.—The
payment for a Tier I conservation security contract shall
consist of the total of the following amounts:
‘‘(i) An amount equal to 5 percent of the applicable
base payment for land covered by the contract.
‘‘(ii) An amount that does not exceed 75 percent
(or, in the case of a beginning farmer or rancher,
90 percent) of the average county costs of practices

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for the 2001 crop year that are included in the conservation security contract, as determined by the Secretary, including the costs of—
‘‘(I) the adoption of new management, vegetative, and land-based structural practices;
‘‘(II) the maintenance of existing land management and vegetative practices; and
‘‘(III) the maintenance of existing land-based
structural practices that are approved by the Secretary but not already covered by a Federal or
State maintenance requirement.
‘‘(iii) An enhanced payment that is determined by
the Secretary in a manner that ensures equity across
regions of the United States, if the producer—
‘‘(I) implements or maintains multiple conservation practices that exceed minimum requirements for the applicable tier of participation
(including practices that involve a change in land
use, such as resource-conserving crop rotation,
managed rotational grazing, or conservation buffer
practices);
‘‘(II) addresses local conservation priorities in
addition to resources of concern for the agricultural
operation;
‘‘(III) participates in an on-farm conservation
research, demonstration, or pilot project;
‘‘(IV) participates in a watershed or regional
resource conservation plan that involves at least
75 percent of producers in a targeted area; or
‘‘(V) carries out assessment and evaluation
activities relating to practices included in a conservation security plan.
‘‘(D) TIER II CONSERVATION SECURITY CONTRACTS.—The
payment for a Tier II conservation security contract shall
consist of the total of the following amounts:
‘‘(i) An amount equal to 10 percent of the applicable
base payment for land covered by the conservation
security contract.
‘‘(ii) An amount that does not exceed 75 percent
(or, in the case of a beginning farmer or rancher,
90 percent) of the average county cost of adopting
or maintaining practices for the 2001 crop year that
are included in the conservation security contract, as
described in subparagraph (C)(ii).
‘‘(iii) An enhanced payment that is determined in
accordance with subparagraph (C)(iii).
‘‘(E) TIER III CONSERVATION SECURITY CONTRACTS.—The
payment for a Tier III conservation security contract shall
consist of the total of the following amounts:
‘‘(i) An amount equal to 15 percent of the base
payment for land covered by the conservation security
contract.
‘‘(ii) An amount that does not exceed 75 percent
(or, in the case of a beginning farmer or rancher,
90 percent) of the average county cost of adopting
or maintaining practices for the 2001 crop year that

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are included in the conservation security contract, as
described in subparagraph (C)(ii).
‘‘(iii) An enhanced payment that is determined in
accordance with subparagraph (C)(iii).
‘‘(2) LIMITATION ON PAYMENTS.—
‘‘(A) IN GENERAL.—Subject to paragraphs (1) and (3),
the Secretary shall make an annual payment, directly or
indirectly, to an individual or entity covered by a conservation security contract in an amount not to exceed—
‘‘(i) in the case of a Tier I conservation security
contract, $20,000;
‘‘(ii) in the case of a Tier II conservation security
contract, $35,000; or
‘‘(iii) in the case of a Tier III conservation security
contract, $45,000.
‘‘(B) LIMITATION ON BASE PAYMENTS.—In applying the
payment limitation under each of clauses (i), (ii), and (iii)
of subparagraph (A), an individual or entity may not
receive, directly or indirectly, payments described in clause
(i) of paragraph (1)(C), (1)(D), or (1)(E), as appropriate,
in an amount that exceeds—
‘‘(i) in the case of Tier I contracts, 25 percent
of the applicable payment limitation; or
‘‘(ii) in the case of Tier II contracts and Tier III
contracts, 30 percent of the applicable payment limitation.
‘‘(C) OTHER USDA PAYMENTS.—A producer shall not
receive payments under the conservation security program
and any other conservation program administered by the
Secretary for the same practices on the same land.
‘‘(D) COMMENSURATE SHARE.—To be eligible to receive
a payment under this subchapter, an individual or entity
shall make contributions (including contributions of land,
labor, management, equipment, or capital) to the operation
of the farm that are at least commensurate with the share
of the proceeds of the operation of the individual or entity.
‘‘(3) EQUIPMENT OR FACILITIES.—A payment to a producer
under this subchapter shall not be provided for—
‘‘(A) construction or maintenance of animal waste storage or treatment facilities or associated waste transport
or transfer devices for animal feeding operations; or
‘‘(B) the purchase or maintenance of equipment or a
non-land based structure that is not integral to a landbased practice, as determined by the Secretary.
‘‘(c) MINIMUM PRACTICE REQUIREMENT.—In determining a payment under subsection (b) for a producer that receives a payment
under another program administered by the Secretary that is
contingent on complying with requirements under subtitle B or
C (relating to the use of highly erodible land or wetland), a payment
under this subchapter on land subject to those requirements shall
be for practices only to the extent that the practices exceed minimum requirements for the producer under those subtitles, as determined by the Secretary.
‘‘(d) REGULATIONS.—The Secretary shall promulgate regulations
that—

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‘‘(1) provide for adequate safeguards to protect the interests
of tenants and sharecroppers, including provision for sharing
payments, on a fair and equitable basis; and
‘‘(2) prescribe such other rules as the Secretary determines
to be necessary to ensure a fair and reasonable application
of the limitations established under subsection (b).
‘‘(e) TRANSFER OR CHANGE OF INTEREST IN LAND SUBJECT TO
CONSERVATION SECURITY CONTRACT.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
the transfer, or change in the interest, of a producer in land
subject to a conservation security contract shall result in the
termination of the conservation security contract.
‘‘(2) TRANSFER OF DUTIES AND RIGHTS.—Paragraph (1) shall
not apply if, not later than 60 days after the date of the
transfer or change in the interest in land, the transferee of
the land provides written notice to the Secretary that all duties
and rights under the conservation security contract have been
transferred to, and assumed by, the transferee.
‘‘(f) ENROLLMENT PROCEDURE.—In entering into conservation
security contracts with producers under this subchapter, the Secretary shall not use competitive bidding or any similar procedure.
‘‘(g) TECHNICAL ASSISTANCE.—For each of fiscal years 2003
through 2007, the Secretary shall provide technical assistance to
producers for the development and implementation of conservation
security contracts, in an amount not to exceed 15 percent of amounts
expended for the fiscal year.’’.
(b) REGULATIONS.—Not later than 270 days after the date of
enactment of this Act, the Secretary of Agriculture shall promulgate
regulations implementing the amendment made by subsection (a).

Deadline.

Deadline.
16 USC 3838
note.

SEC. 2002. CONSERVATION COMPLIANCE.

(a) HIGHLY ERODIBLE LAND.—Section 1211 of the Food Security
Act of 1985 (16 U.S.C. 3811) is amended—
(1) by striking the section heading and all that follows
through ‘‘Except as provided in’’ and inserting the following:
‘‘SEC. 1211. PROGRAM INELIGIBILITY.

‘‘(a) IN GENERAL.—Except as provided in’’; and
(2) by adding at the end the following:
‘‘(b) HIGHLY ERODIBLE LAND.—The Secretary shall have, and
shall not delegate to any private person or entity, authority to
determine whether a person has complied with this subtitle.’’.
(b) WETLAND.—Section 1221 of the Food Security Act of 1985
(16 U.S.C. 3821) is amended by adding at the end the following:
‘‘(e) WETLAND.—The Secretary shall have, and shall not delegate to any private person or entity, authority to determine whether
a person has complied with this subtitle.’’.
SEC. 2003. PARTNERSHIPS AND COOPERATION.

Section 1243 of the Food Security Act of 1985 (16 U.S.C. 3843)
is amended by adding at the end the following:
‘‘(f) PARTNERSHIPS AND COOPERATION.—
‘‘(1) IN GENERAL.—In carrying out any program under subtitle D, the Secretary may use resources provided under that
subtitle to enter into stewardship agreements with State and
local agencies, Indian tribes, and nongovernmental organizations and to designate special projects, as recommended by
the State Conservationist, after consultation with the State

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technical committee, to enhance technical and financial assistance provided to owners, operators, and producers to address
natural resource issues related to agricultural production.
‘‘(2) CRITERIA FOR SPECIAL PROJECTS.—The purposes of special projects carried out under this subsection shall be to
encourage—
‘‘(A) producers to cooperate in the installation and
maintenance of conservation practices that affect multiple
agricultural operations;
‘‘(B) the sharing of information and technical and financial resources among producers;
‘‘(C) cumulative conservation benefits in geographic
areas; and
‘‘(D) the development and demonstration of innovative
conservation methods.
‘‘(3) INCENTIVES.—To realize the purposes of the special
projects under paragraph (1), the Secretary may provide special
incentives to owners, operators, and producers participating
in the special projects to encourage partnerships and enrollments of optimal conservation value.
‘‘(4) FLEXIBILITY.—
‘‘(A) IN GENERAL.—The Secretary may enter into
stewardship agreements with States (including State agencies and units of local government), Indian tribes, and
nongovernmental organizations that have a history of
working with agricultural producers to allow greater flexibility to adjust the application of eligibility criteria,
approved practices, innovative conservation practices, and
other elements of the programs under this title to better
reflect unique local circumstances and purposes in a
manner that is consistent with—
‘‘(i) conservation enhancement and long-term
productivity of the natural resource base; and
‘‘(ii) the purposes and requirements of this title.
‘‘(B) PLAN.—Each party to a stewardship agreement
under subparagraph (A) shall submit to the Secretary,
for approval by the Secretary, a special project area plan
for each program to be carried out by the party that
includes—
‘‘(i) a description of the requested resources and
adjustments to program implementation (including a
description of how those adjustments will accelerate
the achievement of conservation benefits);
‘‘(ii) an analysis of the contribution those adjustments will make to the effectiveness of programs in
achieving the purposes of the special project;
‘‘(iii) a timetable for reevaluating the need for or
performance of the proposed adjustments;
‘‘(iv) a description of non-Federal programs and
resources that will contribute to achieving the purposes
of the special project; and
‘‘(v) a plan for the evaluation of progress toward
the purposes of the special project.
‘‘(5) FUNDING.—
‘‘(A) IN GENERAL.—In addition to resources from programs under subtitle D, subject to subparagraph (B), the
Secretary shall use not more than 5 percent of the funds

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made available for each fiscal year under section 1241(a)
to carry out activities that are authorized under conservation programs under subtitle D.
‘‘(B) UNUSED FUNDING.—Any funds made available for
a fiscal year under subparagraph (A) that are not obligated
by April 1 of the fiscal year may be used to carry out
other activities under conservation programs under subtitle
D during the fiscal year in which the funding becomes
available.’’.
SEC. 2004. ADMINISTRATIVE REQUIREMENTS FOR CONSERVATION
PROGRAMS.

(a) IN GENERAL.—Subtitle E of title XII of the Food Security
Act of 1985 (16 U.S.C. 3841 et seq.) is amended by adding at
the end the following:
‘‘SEC. 1244. ADMINISTRATIVE REQUIREMENTS FOR CONSERVATION
PROGRAMS.

16 USC 3844.

‘‘(a) BEGINNING FARMERS AND RANCHERS AND INDIAN TRIBES.—
In carrying out any conservation program administered by the
Secretary, the Secretary may provide to beginning farmers and
ranchers and Indian tribes (as those terms are defined in section
1238) and limited resource agricultural producers incentives to
participate in the conservation program to—
‘‘(1) foster new farming and ranching opportunities; and
‘‘(2) enhance environmental stewardship over the long term.
‘‘(b) PRIVACY OF PERSONAL INFORMATION RELATING TO NATURAL
RESOURCES CONSERVATION PROGRAMS.—
‘‘(1) INFORMATION RECEIVED FOR TECHNICAL AND FINANCIAL
ASSISTANCE.—
‘‘(A) IN GENERAL.—In accordance with section 552(b)(3)
of title 5, United States Code, except as provided in
subparagraph (C) and paragraph (2), information described
in subparagraph (B)—
‘‘(i) shall not be considered to be public information; and
‘‘(ii) shall not be released to any person or Federal,
State, local agency or Indian tribe (as defined by the
Secretary) outside the Department of Agriculture.
‘‘(B) INFORMATION.—The information referred to in
subparagraph (A) is information—
‘‘(i) provided to the Secretary or a contractor of
the Secretary (including information provided under
subtitle D) for the purpose of providing technical or
financial assistance to an owner, operator, or producer
with respect to any natural resources conservation program administered by the Natural Resources Conservation Service or the Farm Service Agency; and
‘‘(ii) that is proprietary (within the meaning of
section 552(b)(4) of title 5, United States Code) to
the agricultural operation or land that is a part of
an agricultural operation of the owner, operator, or
producer.
‘‘(C) EXCEPTION.—Nothing in this section affects the
availability of payment information (including payment
amounts and the names and addresses of recipients of
payments) under section 552 of title 5, United States Code.
‘‘(2) EXCEPTIONS.—

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‘‘(A) RELEASE AND DISCLOSURE FOR ENFORCEMENT.—
The Secretary may release or disclose to the Attorney General information covered by paragraph (1) to the extent
necessary to enforce the natural resources conservation
programs referred to in paragraph (1)(B)(i).
‘‘(B) DISCLOSURE TO COOPERATING PERSONS AND AGENCIES.—
‘‘(i) IN GENERAL.—The Secretary may release or
disclose information covered by paragraph (1) to a person or Federal, State, local, or tribal agency working
in cooperation with the Secretary in providing technical
and financial assistance described in paragraph
(1)(B)(i) or collecting information from data gathering
sites.
‘‘(ii) USE OF INFORMATION.—The person or Federal,
State, local, or tribal agency that receives information
described in clause (i) may release the information
only for the purpose of assisting the Secretary—
‘‘(I) in providing the requested technical or
financial assistance; or
‘‘(II) in collecting information from data gathering sites.
‘‘(C) STATISTICAL AND AGGREGATE INFORMATION.—
Information covered by paragraph (1) may be disclosed
to the public if the information has been transformed into
a statistical or aggregate form without naming any—
‘‘(i) individual owner, operator, or producer; or
‘‘(ii) specific data gathering site.
‘‘(D) CONSENT OF OWNER, OPERATOR, OR PRODUCER.—
‘‘(i) IN GENERAL.—An owner, operator, or producer
may consent to the disclosure of information described
in paragraph (1).
‘‘(ii) CONDITION OF OTHER PROGRAMS.—The participation of the owner, operator, or producer in, and
the receipt of any benefit by the owner, operator, or
producer under, this title or any other program
administered by the Secretary may not be conditioned
on the owner, operator, or producer providing consent
under this paragraph.
‘‘(3) VIOLATIONS; PENALTIES.—Section 1770(c) shall apply
with respect to the release of information collected in any
manner or for any purpose prohibited by this subsection.
‘‘(4) DATA COLLECTION, DISCLOSURE, AND REVIEW.—Nothing
in this subsection—
‘‘(A) affects any procedure for data collection or disclosure through the National Resources Inventory; or
‘‘(B) limits the authority of Congress or the General
Accounting Office to review information collected or disclosed under this subsection.’’.
(b) NATIONAL RESOURCES INVENTORY.—Section 1770 of the Food
Security Act of 1985 (7 U.S.C. 2276) is amended—
(1) in subsection (a)—
(A) in paragraph (1), by striking ‘‘or’’ at the end;
(B) in paragraph (2), by striking the period and
inserting ‘‘; or’’; and
(C) by adding at the end the following:

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‘‘(3) in the case of information collected under the authority
described in subsection (d)(12), disclose the information to any
person or any Federal, State, local, or tribal agency outside
the Department of Agriculture, unless the information has been
converted into a statistical or aggregate form that does not
allow the identification of the person that supplied particular
information.’’; and
(2) in subsection (d)—
(A) in paragraph (9), by striking ‘‘or’’ at the end;
(B) in paragraph (11), by striking the period and
inserting ‘‘; or’’; and
(C) by adding at the end the following:
‘‘(12) section 302 of the Rural Development Act of 1972
(7 U.S.C. 1010a) regarding the authority to collect data for
the National Resources Inventory.’’.
SEC. 2005. REFORM AND ASSESSMENT OF CONSERVATION PROGRAMS.

(a) IN GENERAL.—The Secretary of Agriculture shall develop
a plan to coordinate land retirement and agricultural working land
conservation programs that are administered by the Secretary to
achieve the goals of—
(1) eliminating redundancy;
(2) streamlining program delivery; and
(3) improving services provided to agricultural producers
(including the reevaluation of the provision of technical assistance).
(b) REPORT.—Not later than December 31, 2005, the Secretary
of Agriculture shall submit to the Committee on Agriculture of
the House of Representatives and the Committee on Agriculture,
Nutrition, and Forestry of the Senate, a report that describes—
(1) the plan developed under subsection (a); and
(2) the means by which the Secretary intends to achieve
the goals described in subsection (a).

16 USC 3801
note.

Deadline.

SEC. 2006. CONFORMING AMENDMENTS.

(a) Chapter 1 of subtitle D of title XII of the Food Security
Act of 1985 (16 U.S.C. 3830 et seq.) is amended by striking the
chapter heading and inserting the following:
‘‘CHAPTER 1—COMPREHENSIVE CONSERVATION
ENHANCEMENT PROGRAM’’.
(b) Section 1230 of the Food Security Act of 1985 (16 U.S.C.
3830) is amended—
(1) in the section heading, by striking ‘‘ENVIRONMENTAL
CONSERVATION ACREAGE RESERVE PROGRAM’’ and inserting
‘‘COMPREHENSIVE CONSERVATION ENHANCEMENT PROGRAM’’;
(2) in subsection (a)(1), by striking ‘‘an environmental conservation acreage reserve program’’ and inserting ‘‘a comprehensive conservation enhancement program’’;
(3) by striking subsection (c); and
(4) by striking ‘‘ECARP’’ each place it appears and inserting
‘‘CCEP’’.
(c) Section 1230A of the Food Security Act of 1985 (16 U.S.C.
3830a) is repealed.
(d) Section 1243 of the Food Security Act of 1985 (16 U.S.C.
3843) is amended by striking the section heading and inserting
the following:

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‘‘SEC. 1243. ADMINISTRATION OF CCEP.’’.

Subtitle B—Conservation Reserve
SEC. 2101. CONSERVATION RESERVE PROGRAM.

(a) IN GENERAL.—Subchapter B of chapter 1 of subtitle D
of title XII of the Food Security Act of 1985 (16 U.S.C. 3831
et seq.) is amended to read as follows:
‘‘Subchapter B—Conservation Reserve
16 USC 3831.

‘‘SEC. 1231. CONSERVATION RESERVE.

‘‘(a) IN GENERAL.—Through the 2007 calendar year, the Secretary shall formulate and carry out a conservation reserve program
under which land is enrolled through the use of contracts to assist
owners and operators of land specified in subsection (b) to conserve
and improve the soil, water, and wildlife resources of such land.
‘‘(b) ELIGIBLE LAND.—The Secretary may include in the program
established under this subchapter—
‘‘(1) highly erodible cropland that—
‘‘(A)(i) if permitted to remain untreated could substantially reduce the agricultural production capability for
future generations; or
‘‘(ii) cannot be farmed in accordance with a plan that
complies with the requirements of subtitle B; and
‘‘(B) the Secretary determines had a cropping history
or was considered to be planted for 4 of the 6 years preceding the date of enactment of the Farm Security and
Rural Investment Act of 2002 (except for land enrolled
in the conservation reserve program as of that date).
‘‘(2) marginal pasture land converted to wetland or established as wildlife habitat prior to November 28, 1990;
‘‘(3) marginal pasture land to be devoted to appropriate
vegetation, including trees, in or near riparian areas, or devoted
to similar water quality purposes (including marginal
pastureland converted to wetland or established as wildlife
habitat);
‘‘(4) cropland that is otherwise ineligible if the Secretary
determines that—
‘‘(A) if permitted to remain in agricultural production,
the land would—
‘‘(i) contribute to the degradation of soil, water,
or air quality; or
‘‘(ii) pose an on-site or off-site environmental threat
to soil, water, or air quality;
‘‘(B) the land is a—
‘‘(i) newly-created, permanent grass sod waterway;
or
‘‘(ii) a contour grass sod strip established and
maintained as part of an approved conservation plan;
‘‘(C) the land will be devoted to newly established
living snow fences, permanent wildlife habitat, windbreaks,
shelterbelts, or filterstrips devoted to trees or shrubs; or
‘‘(D) the land poses an off-farm environmental threat,
or a threat of continued degradation of productivity due
to soil salinity, if permitted to remain in production; and

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‘‘(E) enrollment of the land would facilitate a net
savings in groundwater or surface water resources of the
agricultural operation of the producer;
‘‘(5) the portion of land in a field not enrolled in the
conservation reserve in a case in which more than 50 percent
of the land in the field is enrolled as a buffer, if—
‘‘(A) the land is enrolled as part of the buffer; and
‘‘(B) the remainder of the field is—
‘‘(i) infeasible to farm; and
‘‘(ii) enrolled at regular rental rates.
‘‘(c) PLANTING STATUS OF CERTAIN LAND.—For purposes of
determining the eligibility of land to be placed in the conservation
reserve established under this subchapter, land shall be considered
to be planted to an agricultural commodity during a crop year
if—
‘‘(1) during the crop year, the land was devoted to a conserving use; or
‘‘(2)(A) during the crop year or during any of the 2 years
preceding the crop year, the land was enrolled in the water
bank program; and
‘‘(B) the contract of the owner or operator of the cropland
expired or will expire in calendar year 2000, 2001, or 2002.
‘‘(d) MAXIMUM ENROLLMENT.—The Secretary may maintain up
to 39,200,000 acres in the conservation reserve at any 1 time
during the 2002 through 2007 calendar years (including contracts
extended by the Secretary pursuant to section 1437(c) of the Food,
Agriculture, Conservation, and Trade Act of 1990 ( 16 U.S.C. 3831
note; Public Law 101–624)).
‘‘(e) DURATION OF CONTRACT.—
‘‘(1) IN GENERAL.—For the purpose of carrying out this
subchapter, the Secretary shall enter into contracts of not less
than 10, nor more than 15, years.
‘‘(2) CERTAIN LAND.—
‘‘(A) IN GENERAL.—In the case of land devoted to hardwood trees, shelterbelts, windbreaks, or wildlife corridors
under a contract entered into under this subchapter after
October 1, 1990, and land devoted to such uses under
contracts modified under section 1235A, the owner or operator of the land may, within the limitations prescribed
under this section, specify the duration of the contract.
‘‘(B) HARDWOOD TREES.—In the case of land that is
devoted to hardwood trees under a contract entered into
under this subchapter prior to October 1, 1990, the Secretary may extend the contract for a term of not to exceed
5 years, as agreed to by the owner or operator of such
land and the Secretary.
‘‘(3) 1-YEAR EXTENSION.—In the case of a contract described
in paragraph (1) the term of which expires during calendar
year 2002, an owner or operator of land enrolled under the
contract may extend the contract for 1 additional year.
‘‘(f) CONSERVATION PRIORITY AREAS.—
‘‘(1) DESIGNATION.—On application by the appropriate State
agency, the Secretary shall designate watershed areas of the
Chesapeake Bay Region (Pennsylvania, Maryland, and Virginia), the Great Lakes Region, the Long Island Sound Region,
and other areas of special environmental sensitivity as conservation priority areas.

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PUBLIC LAW 107–171—MAY 13, 2002

‘‘(2) ELIGIBLE WATERSHEDS.—Watersheds eligible for designation under this subsection shall include areas with actual
and significant adverse water quality or habitat impacts related
to agricultural production activities.
‘‘(3) EXPIRATION.—Conservation priority area designation
under this subsection shall expire after 5 years, subject to
redesignation, except that the Secretary may withdraw a watershed’s designation—
‘‘(A) on application by the appropriate State agency;
or
‘‘(B) in the case of an area covered by this subsection,
if the Secretary finds that the area no longer contains
actual and significant adverse water quality or habitat
impacts related to agricultural production activities.
‘‘(4) DUTY OF SECRETARY.—In carrying out this subsection,
the Secretary shall attempt to maximize water quality and
habitat benefits in the watersheds described in paragraph (1)
by promoting a significant level of enrollment of land within
the watersheds in the program under this subchapter by whatever means the Secretary determines are appropriate and consistent with the purposes of this subchapter.
‘‘(g) MULTI-YEAR GRASSES AND LEGUMES.—For purposes of this
subchapter, alfalfa and other multi-year grasses and legumes in
a rotation practice, approved by the Secretary, shall be considered
agricultural commodities.
‘‘(h) PILOT PROGRAM FOR ENROLLMENT OF WETLAND AND
BUFFER ACREAGE IN CONSERVATION RESERVE.—
‘‘(1) PROGRAM.—
‘‘(A) IN GENERAL.—During the 2002 through 2007 calendar years, the Secretary shall carry out a program in
each State under which the Secretary shall include eligible
acreage described in paragraph (2) in the program established under this subchapter.
‘‘(B) PARTICIPATION AMONG STATES.-The Secretary shall
ensure, to the maximum extent practicable, that owners
and operators in each State have an equitable opportunity
to participate in the pilot program established under this
subsection.
‘‘(2) ELIGIBLE ACREAGE.—
‘‘(A) IN GENERAL.—Subject to subparagraphs (B)
through (D), an owner or operator may enroll in the conservation reserve under this subsection—
‘‘(i) a wetland (including a converted wetland
described in section 1222(b)(1)(A)) that was cropped
during at least 3 of the immediately preceding 10
crop years; and
‘‘(ii) buffer acreage that—
‘‘(I) is contiguous to the wetland described in
clause (i);
‘‘(II) is used to protect the wetland; and
‘‘(III) is of such width as the Secretary determines is necessary to protect the wetland, taking
into consideration and accommodating the farming
practices (including the straightening of boundaries to accommodate machinery) used with
respect to the cropland that surrounds the wetland.

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‘‘(B) EXCLUSIONS.—An owner or operator may not
enroll in the conservation reserve under this subsection—
‘‘(i) any wetland, or land on a floodplain, that
is, or is adjacent to, a perennial riverine system wetland identified on the final national wetland inventory
map of the Secretary of the Interior; or
‘‘(ii) in the case of an area that is not covered
by the final national inventory map, any wetland, or
land on a floodplain, that is adjacent to a perennial
stream identified on a 1-24,000 scale map of the United
States Geological Survey.
‘‘(C) PROGRAM LIMITATIONS.—
‘‘(i) IN GENERAL.—The Secretary may enroll in the
conservation reserve under this subsection not more
than—
‘‘(I) 100,000 acres in any 1 State referred to
in paragraph (1); and
‘‘(II) not more than a total of 1,000,000 acres.
‘‘(ii) RELATIONSHIP TO PROGRAM MAXIMUM.—Subject to clause (iii), for the purposes of subsection (d),
any acreage enrolled in the conservation reserve under
this subsection shall be considered acres maintained
in the conservation reserve.
‘‘(iii) RELATIONSHIP TO OTHER ENROLLED ACREAGE.—Acreage enrolled under this subsection shall not
affect for any fiscal year the quantity of—
‘‘(I) acreage enrolled to establish conservation
buffers as part of the program announced on
March 24, 1998 (63 Fed. Reg. 14109); or
‘‘(II) acreage enrolled into the conservation
reserve enhancement program announced on May
27, 1998 (63 Fed. Reg. 28965).
‘‘(iv) REVIEW; POTENTIAL INCREASE IN ENROLLMENT
ACREAGE.—Not later than 3 years after the date of
enactment of this clause, the Secretary shall—
‘‘(I) conduct a review of the program under
this subsection with respect to each State that
has enrolled land in the program; and
‘‘(II) notwithstanding clause (i)(I), increase the
number of acres that may be enrolled by a State
under clause (i)(I) to not more than 150,000 acres,
as determined by the Secretary.
‘‘(D) OWNER OR OPERATOR LIMITATIONS.—
‘‘(i) WETLAND.—
‘‘(I) IN GENERAL.—The maximum size of any
wetland described in subparagraph (A)(i) of an
owner or operator enrolled in the conservation
reserve under this subsection shall be 10 contiguous acres, of which not more than 5 acres shall
be eligible for payment.
‘‘(II) COVERAGE.—All acres described in subclause (I) (including acres that are ineligible for
payment) shall be covered by the conservation contract.
‘‘(ii) BUFFER ACREAGE.—The maximum size of any
buffer acreage described in subparagraph (A)(ii) of an

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owner or operator enrolled in the conservation reserve
under this subsection shall be the greater of—
‘‘(I) 3 times the size of any wetland described
in subparagraph (A)(i) to which the buffer acreage
is contiguous; or
‘‘(II) 150 feet on either side of the wetland.
‘‘(iii) TRACTS.—The maximum size of any eligible
acreage described in subparagraph (A) in a tract (as
determined by the Secretary) of an owner or operator
enrolled in the conservation reserve under this subsection shall be 40 acres.
‘‘(3) DUTIES OF OWNERS AND OPERATORS.—Under a contract
entered into under this subsection, during the term of the
contract, an owner or operator of a farm or ranch shall agree—
‘‘(A) to restore the hydrology of the wetland within
the eligible acreage to the maximum extent practicable,
as determined by the Secretary;
‘‘(B) to establish vegetative cover (which may include
emerging vegetation in water) on the eligible acreage, as
determined by the Secretary; and
‘‘(C) to carry out other duties described in section 1232.
‘‘(4) DUTIES OF THE SECRETARY.—
‘‘(A) IN GENERAL.—Except as provided in subparagraphs (B) and (C), in return for a contract entered into
by an owner or operator under this subsection, the Secretary shall make payments and provide assistance to the
owner or operator in accordance with sections 1233 and
1234.
‘‘(B) CONTINUOUS SIGNUP.—The Secretary shall use
continuous signup under section 1234(c)(2)(B) to determine
the acceptability of contract offers and the amount of rental
payments under this subsection.
‘‘(C) INCENTIVES.—The amounts payable to owners and
operators in the form of rental payments under contracts
entered into under this subsection shall reflect incentives
that are provided to owners and operators to enroll
filterstrips in the conservation reserve under section 1234.
‘‘(i) ELIGIBILITY FOR CONSIDERATION.—On the expiration of a
contract entered into under this subchapter, the land subject to
the contract shall be eligible to be considered for reenrollment
in the conservation reserve.
‘‘(j) BALANCE OF NATURAL RESOURCE PURPOSES.—In determining the acceptability of contract offers under this subchapter,
the Secretary shall ensure, to the maximum extent practicable,
an equitable balance among the conservation purposes of soil erosion, water quality, and wildlife habitat.
‘‘SEC. 1232. DUTIES OF OWNERS AND OPERATORS.
16 USC 3832.

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‘‘(a) IN GENERAL.—Under the terms of a contract entered into
under this subchapter, during the term of the contract, an owner
or operator of a farm or ranch shall agree—
‘‘(1) to implement a plan approved by the local conservation
district (or in an area not located within a conservation district,
a plan approved by the Secretary) for converting eligible land
normally devoted to the production of an agricultural commodity on the farm or ranch to a less intensive use (as defined
by the Secretary), such as pasture, permanent grass, legumes,

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forbs, shrubs, or trees, substantially in accordance with a
schedule outlined in the plan;
‘‘(2) to place highly erodible cropland subject to the contract
in the conservation reserve established under this subchapter;
‘‘(3) not to use the land for agricultural purposes, except
as permitted by the Secretary;
‘‘(4) to establish approved vegetative cover (which may
include emerging vegetation in water), water cover for the
enhancement of wildlife, or, where practicable, maintain
existing cover on the land, except that—
‘‘(A) the water cover shall not include ponds for the
purpose of watering livestock, irrigating crops, or raising
fish for commercial purposes; and
‘‘(B) the Secretary shall not terminate the contract
for failure to establish approved vegetative or water cover
on the land if—
‘‘(i) the failure to plant the cover was due to excessive rainfall or flooding;
‘‘(ii) the land subject to the contract that could
practicably be planted to the cover is planted to the
cover; and
‘‘(iii) the land on which the owner or operator
was unable to plant the cover is planted to the cover
after the wet conditions that prevented the planting
subsides;
‘‘(5) on a violation of a term or condition of the contract
at any time the owner or operator has control of the land—
‘‘(A) to forfeit all rights to receive rental payments
and cost sharing payments under the contract and to refund
to the Secretary any rental payments and cost sharing
payments received by the owner or operator under the
contract, together with interest on the payments as determined by the Secretary, if the Secretary, after considering
the recommendations of the soil conservation district and
the Natural Resources Conservation Service, determines
that the violation is of such nature as to warrant termination of the contract; or
‘‘(B) to refund to the Secretary, or accept adjustments
to, the rental payments and cost sharing payments provided
to the owner or operator, as the Secretary considers appropriate, if the Secretary determines that the violation does
not warrant termination of the contract;
‘‘(6) on the transfer of the right and interest of the owner
or operator in land subject to the contract—
‘‘(A) to forfeit all rights to rental payments and cost
sharing payments under the contract; and
‘‘(B) to refund to the United States all rental payments
and cost sharing payments received by the owner or operator, or accept such payment adjustments or make such
refunds as the Secretary considers appropriate and consistent with the objectives of this subchapter;
unless the transferee of the land agrees with the Secretary
to assume all obligations of the contract, except that no refund
of rental payments and cost sharing payments shall be required
if the land is purchased by or for the United States Fish
and Wildlife Service, or the transferee and the Secretary agree

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to modifications to the contract, in a case in which the modifications are consistent with the objectives of the program, as
determined by the Secretary;
‘‘(7) not to conduct any harvesting or grazing, nor otherwise
make commercial use of the forage, on land that is subject
to the contract, nor adopt any similar practice specified in
the contract by the Secretary as a practice that would tend
to defeat the purposes of the contract, except that the Secretary
may permit, consistent with the conservation of soil, water
quality, and wildlife habitat (including habitat during nesting
seasons for birds in the area)—
‘‘(A) managed harvesting and grazing (including the
managed harvesting of biomass), except that in permitting
managed harvesting and grazing, the Secretary—
‘‘(i) shall, in coordination with the State technical
committee—
‘‘(I) develop appropriate vegetation management requirements; and
‘‘(II) identify periods during which harvesting
and grazing under this paragraph may be conducted;
‘‘(ii) may permit harvesting and grazing or other
commercial use of the forage on the land that is subject
to the contract in response to a drought or other emergency; and
‘‘(iii) shall, in the case of routine managed harvesting or grazing or harvesting or grazing conducted
in response to a drought or other emergency, reduce
the rental payment otherwise payable under the contract by an amount commensurate with the economic
value of the activity; and
‘‘(B) the installation of wind turbines, except that in
permitting the installation of wind turbines, the Secretary
shall determine the number and location of wind turbines
that may be installed, taking into account—
‘‘(i) the location, size, and other physical characteristics of the land;
‘‘(ii) the extent to which the land contains wildlife
and wildlife habitat; and
‘‘(iii) the purposes of the conservation reserve program under this subchapter;
‘‘(8) not to conduct any planting of trees on land that
is subject to the contract unless the contract specifies that
the harvesting and commercial sale of trees such as Christmas
trees are prohibited, nor otherwise make commercial use of
trees on land that is subject to the contract unless it is expressly
permitted in the contract, nor adopt any similar practice specified in the contract by the Secretary as a practice that would
tend to defeat the purposes of the contract, except that no
contract shall prohibit activities consistent with customary forestry practice, such as pruning, thinning, or stand improvement
of trees, on land converted to forestry use;
‘‘(9) not to adopt any practice specified by the Secretary
in the contract as a practice that would tend to defeat the
purposes of this subchapter; and
‘‘(10) to comply with such additional provisions as the Secretary determines are desirable and are included in the contract

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to carry out this subchapter or to facilitate the practical
administration of this subchapter.
‘‘(b) CONSERVATION PLANS.—The plan referred to in subsection
(a)(1)—
‘‘(1) shall set forth—
‘‘(A) the conservation measures and practices to be
carried out by the owner or operator during the term
of the contract; and
‘‘(B) the commercial use, if any, to be permitted on
the land during the term; and
‘‘(2) may provide for the permanent retirement of any
existing cropland base and allotment history for the land.
‘‘(c) FORECLOSURE.—
‘‘(1) IN GENERAL.—Notwithstanding any other provision of
law, an owner or operator who is a party to a contract entered
into under this subchapter may not be required to make repayments to the Secretary of amounts received under the contract
if the land that is subject to the contract has been foreclosed
on and the Secretary determines that forgiving the repayments
is appropriate in order to provide fair and equitable treatment.
‘‘(2) RESUMPTION OF CONTROL.—
‘‘(A) IN GENERAL.—This subsection shall not void the
responsibilities of an owner or operator under the contract
if the owner or operator resumes control over the land
that is subject to the contract within the period specified
in the contract.
‘‘(B) CONTRACT.—On the resumption of the control over
the land by the owner or operator, the provisions of the
contract in effect on the date of the foreclosure shall apply.
‘‘SEC. 1233. DUTIES OF THE SECRETARY.

16 USC 3833.

‘‘In return for a contract entered into by an owner or operator
under section 1232, the Secretary shall—
‘‘(1) share the cost of carrying out the conservation measures and practices set forth in the contract for which the
Secretary determines that cost sharing is appropriate and in
the public interest; and
‘‘(2) for a period of years not in excess of the term of
the contract, pay an annual rental payment in an amount
necessary to compensate for—
‘‘(A) the conversion of highly erodible cropland normally
devoted to the production of an agricultural commodity
on a farm or ranch to a less intensive use; and
‘‘(B) the retirement of any cropland base and allotment
history that the owner or operator agrees to retire permanently.
‘‘SEC. 1234. PAYMENTS.

16 USC 3834.

‘‘(a) TIMING.—The Secretary shall provide payment for obligations incurred by the Secretary under a contract entered into under
this subchapter—
‘‘(1) with respect to any cost-sharing payment obligation
incurred by the Secretary, as soon as practicable after the
obligation is incurred; and
‘‘(2) with respect to any annual rental payment obligation
incurred by the Secretary—
‘‘(A) as soon as practicable after October 1 of each
calendar year; or

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‘‘(B) at the option of the Secretary, at any time prior
to such date during the year that the obligation is incurred.
‘‘(b) FEDERAL PERCENTAGE OF COST SHARING PAYMENTS.—
‘‘(1) IN GENERAL.—In making cost sharing payments to
an owner or operator under a contract entered into under
this subchapter, the Secretary shall pay 50 percent of the
cost of establishing water quality and conservation measures
and practices required under each contract for which the Secretary determines that cost sharing is appropriate and in the
public interest.
‘‘(2) LIMITATION.—The Secretary shall not make any payment to an owner or operator under this subchapter to the
extent that the total amount of cost sharing payments provided
to the owner or operator from all sources would exceed 100
percent of the total cost of establishing measures and practices
described in paragraph (1).
‘‘(3) HARDWOOD TREES, WINDBREAKS, SHELTERBELTS, AND
WILDLIFE CORRIDORS.—
‘‘(A) APPLICABILITY.—This paragraph applies to—
‘‘(i) land devoted to the production of hardwood
trees, windbreaks, shelterbelts, or wildlife corridors
under a contract entered into under this subchapter
after November 28, 1990; and
‘‘(ii) land converted to such production under section 1235A.
‘‘(B) PAYMENTS.—In making cost share payments to
an owner or operator of land described in subparagraph
(A), the Secretary shall pay 50 percent of the reasonable
and necessary costs, as determined by the Secretary,
incurred by the owner or operator for maintaining trees
or shrubs, including the cost of replanting (if the trees
or shrubs were lost due to conditions beyond the control
of the owner or operator), during not less than the 2year, and not more than the 4-year, period beginning on
the date of the planting of the trees or shrubs, as determined appropriate by the Secretary.
‘‘(4) HARDWOOD TREE PLANTING.—The Secretary may
permit owners or operators that contract to devote at least
10 acres of land to the production of hardwood trees under
this subchapter to extend the planting of the trees over a
3-year period if at least 1⁄3 of the trees are planted in each
of the first 2 years.
‘‘(5) OTHER FEDERAL COST SHARE ASSISTANCE.—An owner
or operator shall not be eligible to receive or retain cost share
assistance under this subsection if the owner or operator
receives any other Federal cost share assistance with respect
to the land under any other provision of law.
‘‘(c) ANNUAL RENTAL PAYMENTS.—
‘‘(1) IN GENERAL.—In determining the amount of annual
rental payments to be paid to owners and operators for converting highly erodible cropland normally devoted to the production of an agricultural commodity to less intensive use, the
Secretary may consider, among other things, the amount necessary to encourage owners or operators of highly erodible
cropland to participate in the program established by this subchapter.

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‘‘(2) METHOD OF DETERMINATION.—The amounts payable
to owners or operators in the form of rental payments under
contracts entered into under this subchapter may be determined
through—
‘‘(A) the submission of bids for such contracts by owners
and operators in such manner as the Secretary may prescribe; or
‘‘(B) such other means as the Secretary determines
are appropriate.
‘‘(3) ACCEPTANCE OF CONTRACT OFFERS.—In determining
the acceptability of contract offers, the Secretary may—
‘‘(A) take into consideration the extent to which enrollment of the land that is the subject of the contract offer
would improve soil resources, water quality, wildlife
habitat, or provide other environmental benefits; and
‘‘(B) establish different criteria in various States and
regions of the United States based on the extent to which
water quality or wildlife habitat may be improved or erosion may be abated.
‘‘(4) HARDWOOD TREE ACREAGE.—In the case of acreage
enrolled in the conservation reserve established under this
subchapter that is to be devoted to hardwood trees, the Secretary may consider bids for contracts under this subsection
on a continuous basis.
‘‘(d) CASH OR IN-KIND PAYMENTS.—
‘‘(1) IN GENERAL.—Except as otherwise provided in this
section, payments under this subchapter—
‘‘(A) shall be made in cash or in commodities in such
amount and on such time schedule as is agreed on and
specified in the contract; and
‘‘(B) may be made in advance of determination of
performance.
‘‘(2) METHOD OF PROVIDING IN-KIND PAYMENTS.—If the payment to an owner or operator is made with in-kind commodities,
the payment shall be made by the Commodity Credit
Corporation—
‘‘(A) by delivery of the commodity involved to the owner
or operator at a warehouse or other similar facility located
in the county in which the highly erodible cropland is
located or at such other location as is agreed to by the
Secretary and the owner or operator;
‘‘(B) by the transfer of negotiable warehouse receipts;
or
‘‘(C) by such other method, including the sale of the
commodity in commercial markets, as is determined by
the Secretary to be appropriate to enable the owner or
operator to receive efficient and expeditious possession of
the commodity.
‘‘(3) CASH PAYMENTS.—
‘‘(A) COMMODITY CREDIT CORPORATION STOCKS.—If
stocks of a commodity acquired by the Commodity Credit
Corporation are not readily available to make full payment
in kind to the owner or operator, the Secretary may substitute full or partial payment in cash for payment in
kind.
‘‘(B) SPECIAL CONSERVATION RESERVE ENHANCEMENT
PROGRAM.—Payments to an owner or operator under a

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special conservation reserve enhancement program
described in subsection (f)(4) shall be in the form of cash
only.
‘‘(e) PAYMENTS ON DEATH, DISABILITY, OR SUCCESSION.—If an
owner or operator that is entitled to a payment under a contract
entered into under this subchapter dies, becomes incompetent, is
otherwise unable to receive the payment, or is succeeded by another
person that renders or completes the required performance, the
Secretary shall make the payment, in accordance with regulations
prescribed by the Secretary and without regard to any other provision of law, in such manner as the Secretary determines is fair
and reasonable in light of all of the circumstances.
‘‘(f) PAYMENT LIMITATION FOR RENTAL PAYMENTS.—
‘‘(1) IN GENERAL.—The total amount of rental payments,
including rental payments made in the form of in-kind commodities, made to a person under this subchapter for any fiscal
year may not exceed $50,000.
‘‘(2) REGULATIONS.—
‘‘(A) IN GENERAL.—The Secretary shall promulgate
regulations—
‘‘(i) defining the term ‘person’ as used in this subsection; and
‘‘(ii) providing such terms and conditions as the
Secretary determines necessary to ensure a fair and
reasonable application of the limitation established by
this subsection.
‘‘(B) CORPORATIONS AND STOCKHOLDERS.—The regulations promulgated by the Secretary on December 18, 1970,
under section 101 of the Agricultural Act of 1970 (7 U.S.C.
1307), shall be used to determine whether corporations
and their stockholders may be considered as separate persons under this subsection.
‘‘(3) OTHER PAYMENTS.—Rental payments received by an
owner or operator shall be in addition to, and not affect, the
total amount of payments that the owner or operator is otherwise eligible to receive under the Farm Security and Rural
Investment Act of 2002.
‘‘(4) SPECIAL CONSERVATION RESERVE ENHANCEMENT PROGRAM.—
‘‘(A) IN GENERAL.—The provisions of this subsection
that limit payments to any person, and section 1305(d)
of the Agricultural Reconciliation Act of 1987 (7 U.S.C.
1308 note; Public Law 100–203), shall not be applicable
to payments received by a State, political subdivision, or
agency thereof in connection with agreements entered into
under a special conservation reserve enhancement program
carried out by that entity that has been approved by the
Secretary.
‘‘(B) AGREEMENTS.—The Secretary may enter into such
agreements for payments to States (including political subdivisions and agencies of States) that the Secretary determines will advance the purposes of this subchapter.
‘‘(g) OTHER STATE OR LOCAL ASSISTANCE.—In addition to any
payment under this subchapter, an owner or operator may receive
cost share assistance, rental payments, or tax benefits from a State
or subdivision thereof for enrolling land in the conservation reserve
program.

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‘‘SEC. 1235. CONTRACTS.

16 USC 3835.

‘‘(a) OWNERSHIP OR OPERATION REQUIREMENTS.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
no contract shall be entered into under this subchapter concerning land with respect to which the ownership has changed
in the 1-year period preceding the first year of the contract
period unless—
‘‘(A) the new ownership was acquired by will or succession as a result of the death of the previous owner;
‘‘(B) the new ownership was acquired before January
1, 1985;
‘‘(C) the Secretary determines that the land was
acquired under circumstances that give adequate assurance
that the land was not acquired for the purpose of placing
the land in the program established by this subchapter;
or
‘‘(D) the ownership change occurred due to foreclosure
on the land and the owner of the land immediately before
the foreclosure exercises a right of redemption from the
mortgage holder in accordance with State law.
‘‘(2) EXCEPTIONS.—Paragraph (1) shall not—
‘‘(A) prohibit the continuation of an agreement by a
new owner after an agreement has been entered into under
this subchapter; or
‘‘(B) require a person to own the land as a condition
of eligibility for entering into the contract if the person—
‘‘(i) has operated the land to be covered by a contract under this section for at least 1 year preceding
the date of the contract or since January 1, 1985,
whichever is later; and
‘‘(ii) controls the land for the contract period.
‘‘(b) SALES OR TRANSFERS.—If, during the term of a contract
entered into under this subchapter, an owner or operator of land
subject to the contract sells or otherwise transfers the ownership
or right of occupancy of the land, the new owner or operator of
the land may—
‘‘(1) continue the contract under the same terms or conditions;
‘‘(2) enter into a new contract in accordance with this
subchapter; or
‘‘(3) elect not to participate in the program established
by this subchapter.
‘‘(c) MODIFICATIONS.—
‘‘(1) IN GENERAL.—The Secretary may modify a contract
entered into with an owner or operator under this subchapter
if—
‘‘(A) the owner or operator agrees to the modification;
and
‘‘(B) the Secretary determines that the modification
is desirable—
‘‘(i) to carry out this subchapter;
‘‘(ii) to facilitate the practical administration of
this subchapter; or
‘‘(iii) to achieve such other goals as the Secretary
determines are appropriate, consistent with this subchapter.

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‘‘(2) PRODUCTION OF AGRICULTURAL COMMODITIES.—The
Secretary may modify or waive a term or condition of a contract
entered into under this subchapter in order to permit all or
part of the land subject to such contract to be devoted to
the production of an agricultural commodity during a crop
year, subject to such conditions as the Secretary determines
are appropriate.
‘‘(d) TERMINATION.—
‘‘(1) IN GENERAL.—The Secretary may terminate a contract
entered into with an owner or operator under this subchapter
if—
‘‘(A) the owner or operator agrees to the termination;
and
‘‘(B) the Secretary determines that the termination
would be in the public interest.
‘‘(2) NOTICE TO CONGRESSIONAL COMMITTEES.—At least 90
days before taking any action to terminate under paragraph
(1) all conservation reserve contracts entered into under this
subchapter, the Secretary shall provide to the Committee on
Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate written
notice of the action.
‘‘(e) EARLY TERMINATION BY OWNER OR OPERATOR.—
‘‘(1) EARLY TERMINATION.—
‘‘(A) IN GENERAL.—The Secretary shall allow a participant that entered into a contract under this subchapter
before January 1, 1995, to terminate the contract at any
time if the contract has been in effect for at least 5 years.
‘‘(B) LIABILITY FOR CONTRACT VIOLATION.—The termination shall not relieve the participant of liability for a
contract violation occurring before the date of the termination.
‘‘(C) NOTICE TO SECRETARY.—The participant shall provide the Secretary with reasonable notice of the desire
of the participant to terminate the contract.
‘‘(2) CERTAIN LAND EXCEPTED.—The following land shall
not be subject to an early termination of contract under this
subsection:
‘‘(A) Filterstrips, waterways, strips adjacent to riparian
areas, windbreaks, and shelterbelts.
‘‘(B) Land with an erodibility index of more than 15.
‘‘(C) Other land of high environmental value (including
wetland), as determined by the Secretary.
‘‘(3) EFFECTIVE DATE.—The contract termination shall
become effective 60 days after the date on which the owner
or operator submits the notice required under paragraph (1)(C).
‘‘(4) PRORATED RENTAL PAYMENT.—If a contract entered
into under this subchapter is terminated under this subsection
before the end of the fiscal year for which a rental payment
is due, the Secretary shall provide a prorated rental payment
covering the portion of the fiscal year during which the contract
was in effect.
‘‘(5) RENEWED ENROLLMENT.—The termination of a contract
entered into under this subchapter shall not affect the ability
of the owner or operator that requested the termination to
submit a subsequent bid to enroll the land that was subject
to the contract into the conservation reserve.

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‘‘(6) CONSERVATION REQUIREMENTS.—If land that was subject to a contract is returned to production of an agricultural
commodity, the conservation requirements under subtitles B
and C shall apply to the use of the land to the extent that
the requirements are similar to those requirements imposed
on other similar land in the area, except that the requirements
may not be more onerous than the requirements imposed on
other land.
‘‘SEC. 1235A. CONVERSION OF LAND SUBJECT TO CONTRACT TO OTHER
CONSERVING USES.

16 USC 3835a.

‘‘(a) CONVERSION TO TREES.—
‘‘(1) IN GENERAL.—The Secretary shall permit an owner
or operator that has entered into a contract under this subchapter that is in effect on November 28, 1990, to convert
areas of highly erodible cropland that are subject to the contract, and that are devoted to vegetative cover, from that use
to hardwood trees, windbreaks, shelterbelts, or wildlife corridors.
‘‘(2) TERMS.—
‘‘(A) EXTENSION OF CONTRACT.—With respect to a contract that is modified under this section that provides
for the planting of hardwood trees, windbreaks,
shelterbelts, or wildlife corridors, if the original term of
the contract was less than 15 years, the owner or operator
may extend the contract to a term of not to exceed 15
years.
‘‘(B) COST SHARE ASSISTANCE.—The Secretary shall pay
50 percent of the cost of establishing conservation measures
and practices authorized under this subsection for which
the Secretary determines the cost sharing is appropriate
and in the public interest.
‘‘(b) CONVERSION TO WETLAND.—The Secretary shall permit
an owner or operator that has entered into a contract under this
subchapter that is in effect on November 28, 1990, to restore areas
of highly erodible cropland that are devoted to vegetative cover
under the contract to wetland if—
‘‘(1) the areas are prior converted wetland;
‘‘(2) the owner or operator of the areas enters into an
agreement to provide the Secretary with a long-term or permanent easement under subchapter C covering the areas;
‘‘(3) there is a high probability that the prior converted
area can be successfully restored to wetland status; and
‘‘(4) the restoration of the areas otherwise meets the
requirements of subchapter C.
‘‘(c) LIMITATION.—The Secretary shall not incur, through a
conversion under this section, any additional expense on the acres,
including the expense involved in the original establishment of
the vegetative cover, that would result in cost share for costs
under this section in excess of the costs that would have been
subject to cost share for the new practice had that practice been
the original practice.
‘‘(d) CONDITION OF CONTRACT.—An owner or operator shall
as a condition of entering into a contract under subsection (a)
participate in the Forest Stewardship Program established under
section 5 of the Cooperative Forestry Assistance Act of 1978 (16
U.S.C. 2103a).’’.

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PUBLIC LAW 107–171—MAY 13, 2002
(b) STUDY ON ECONOMIC EFFECTS.—
(1) IN GENERAL.—Not later than 18 months after the date
of enactment of this Act, the Secretary of Agriculture shall
submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate a report that describes the economic
and social effects on rural communities resulting from the
conservation reserve program established under subchapter B
of chapter 1 of subtitle D of title XII of the Food Security
Act of 1985 (16 U.S.C. 3831 et seq.).
(2) COMPONENTS.—The study under paragraph (1) shall
include analyses of—
(A) the impact that enrollments in the conservation
reserve program have on rural businesses, civic organizations, and community services (such as schools, public
safety, and infrastructure), particularly in communities
with a large percentage of whole farm enrollments;
(B) the effect that those enrollments have on rural
population and beginning farmers (including a description
of any connection between the rate of enrollment and the
incidence of absentee ownership);
(C)(i) the manner in which differential per acre payment rates potentially impact the types of land (by productivity) enrolled;
(ii) changes to the per acre payment rates that may
affect that impact; and
(iii) the manner in which differential per acre payment
rates could facilitate retention of productive agricultural
land in agriculture; and
(D) the effect of enrollment on opportunities for recreational activities (including hunting and fishing).

16 USC 3831
note.

Subtitle C—Wetlands Reserve Program
SEC. 2201. REAUTHORIZATION.

Section 1237(c) of the Food Security Act of 1985 (16 U.S.C.
3837(c)) is amended by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 2202. ENROLLMENT.

Section 1237 of the Food Security Act of 1985 (16 U.S.C. 3837)
is amended—
(1) by striking subsection (b) and inserting the following:
‘‘(b) ENROLLMENT CONDITIONS.—
‘‘(1) MAXIMUM ENROLLMENT.—The total number of acres
enrolled in the wetlands reserve program shall not exceed
2,275,000 acres, of which, to the maximum extent practicable,
the Secretary shall enroll 250,000 acres in each calendar year.
‘‘(2) METHODS OF ENROLLMENT.—The Secretary shall enroll
acreage into the wetlands reserve program through the use
of permanent easements, 30-year easements, restoration cost
share agreements, or any combination of those options.’’; and
(2) by striking subsection (g).
SEC. 2203. EASEMENTS AND AGREEMENTS.

Section 1237A of the Food Security Act of 1985 (16 U.S.C.
3837a) is amended by striking subsection (h).

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SEC. 2204. CHANGES IN OWNERSHIP; AGREEMENT MODIFICATION;
TERMINATION.

Section 1237E(a) of the Food Security Act of 1985 (16 U.S.C.
3837e(a)) is amended by striking paragraph (2) and inserting the
following:
‘‘(2)(A) the ownership change occurred because of foreclosure on the land; and
‘‘(B) immediately before the foreclosure, the owner of the
land exercises a right of redemption from the mortgage holder
in accordance with State law; or’’.

Subtitle D—Environmental Quality
Incentives
SEC. 2301. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.

Chapter 4 of subtitle D of title XII of the Food Security Act
of 1985 (16 U.S.C. 3839aa et seq.) is amended to read as follows:
‘‘SEC. 1240. PURPOSES.

16 USC 3839aa.

‘‘The purposes of the environmental quality incentives program
established by this chapter are to promote agricultural production
and environmental quality as compatible goals, and to optimize
environmental benefits, by—
‘‘(1) assisting producers in complying with local, State,
and national regulatory requirements concerning—
‘‘(A) soil, water, and air quality;
‘‘(B) wildlife habitat; and
‘‘(C) surface and ground water conservation;
‘‘(2) avoiding, to the maximum extent practicable, the need
for resource and regulatory programs by assisting producers
in protecting soil, water, air, and related natural resources
and meeting environmental quality criteria established by Federal, State, tribal, and local agencies;
‘‘(3) providing flexible assistance to producers to install
and maintain conservation practices that enhance soil, water,
related natural resources (including grazing land and wetland),
and wildlife while sustaining production of food and fiber;
‘‘(4) assisting producers to make beneficial, cost effective
changes to cropping systems, grazing management, nutrient
management associated with livestock, pest or irrigation
management, or other practices on agricultural land; and
‘‘(5) consolidating and streamlining conservation planning
and regulatory compliance processes to reduce administrative
burdens on producers and the cost of achieving environmental
goals.
‘‘SEC. 1240A. DEFINITIONS.

‘‘In this chapter:
‘‘(1) BEGINNING FARMER OR RANCHER.—The term ‘beginning
farmer or rancher’ has the meaning provided under section
343(a) of the Consolidated Farm and Rural Development Act
(7 U.S.C. 1999(a)).
‘‘(2) ELIGIBLE LAND.—
‘‘(A) IN GENERAL.—The term ‘eligible land’ means land
on which agricultural commodities or livestock are produced.

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16 USC
3839aa–1.

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‘‘(B) INCLUSIONS.—The term ‘eligible land’ includes—
‘‘(i) cropland;
‘‘(ii) grassland;
‘‘(iii) rangeland;
‘‘(iv) pasture land;
‘‘(v) private, nonindustrial forest land; and
‘‘(vi) other agricultural land that the Secretary
determines poses a serious threat to soil, air, water,
or related resources.
‘‘(3) LAND MANAGEMENT PRACTICE.—The term ‘land
management practice’ means a site-specific nutrient or manure
management, integrated pest management, irrigation management, tillage or residue management, grazing management,
air quality management, or other land management practice
carried out on eligible land that the Secretary determines is
needed to protect from degradation, in the most cost-effective
manner, water, soil, or related resources.
‘‘(4) LIVESTOCK.—The term ‘livestock’ means dairy cattle,
beef cattle, laying hens, broilers, turkeys, swine, sheep, and
other such animals as are determined by the Secretary.
‘‘(5) PRACTICE.—The term ‘practice’ means 1 or more structural practices, land management practices, and comprehensive
nutrient management planning practices.
‘‘(6) STRUCTURAL PRACTICE.—The term ‘structural practice’
means—
‘‘(A) the establishment on eligible land of a site-specific
animal waste management facility, terrace, grassed waterway, contour grass strip, filterstrip, tailwater pit, permanent wildlife habitat, constructed wetland, or other structural practice that the Secretary determines is needed to
protect, in the most cost effective manner, water, soil,
or related resources from degradation; and
‘‘(B) the capping of abandoned wells on eligible land.

16 USC
3839aa–2.

‘‘SEC. 1240B. ESTABLISHMENT AND ADMINISTRATION OF ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.

‘‘(a) ESTABLISHMENT.—
‘‘(1) IN GENERAL.—During each of the 2002 through 2007
fiscal years, the Secretary shall provide cost-share payments
and incentive payments to producers that enter into contracts
with the Secretary under the program.
‘‘(2) ELIGIBLE PRACTICES.—With respect to practices implemented under this chapter—
‘‘(A) a producer that implements a structural practice
in accordance with this chapter shall be eligible to receive
cost-share payments; and
‘‘(B) a producer that implements a land management
practice, or develops a comprehensive nutrient management plan, in accordance with this chapter shall be eligible
to receive incentive payments.
‘‘(b) PRACTICES AND TERM.—
‘‘(1) PRACTICES.—A contract under this chapter may apply
to 1 or more structural practices, land management practices,
and comprehensive nutrient management practices.
‘‘(2) TERM.—A contract under this chapter shall have a
term that—

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‘‘(A) at a minimum, is equal to the period beginning
on the date on which the contract is entered into and
ending on the date that is 1 year after the date on which
all practices under the contract have been implemented;
but
‘‘(B) not to exceed 10 years.
‘‘(c) BIDDING DOWN.—If the Secretary determines that the
environmental values of 2 or more applications for cost-share payments or incentive payments are comparable, the Secretary shall
not assign a higher priority to the application only because it
would present the least cost to the program established under
the program.
‘‘(d) COST-SHARE PAYMENTS.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
the cost-share payments provided to a producer proposing to
implement 1 or more practices under the program shall be
not more than 75 percent of the cost of the practice, as determined by the Secretary.
‘‘(2) EXCEPTIONS.—
‘‘(A) LIMITED RESOURCE AND BEGINNING FARMERS.—
The Secretary may increase the amount provided to a
producer under paragraph (1) to not more than 90 percent
if the producer is a limited resource or beginning farmer
or rancher, as determined by the Secretary.
‘‘(B) COST-SHARE ASSISTANCE FROM OTHER SOURCES.—
Except as provided in paragraph (3), any cost-share payments received by a producer from a State or private
organization or person for the implementation of 1 or more
practices on eligible land of the producer shall be in addition to the payments provided to the producer under paragraph (1).
‘‘(3) OTHER PAYMENTS.—A producer shall not be eligible
for cost-share payments for practices on eligible land under
the program if the producer receives cost-share payments or
other benefits for the same practice on the same land under
chapter 1 and the program.
‘‘(e) INCENTIVE PAYMENTS.—
‘‘(1) IN GENERAL.—The Secretary shall make incentive payments in an amount and at a rate determined by the Secretary
to be necessary to encourage a producer to perform 1 or more
land management practices.
‘‘(2) SPECIAL RULE.—In determining the amount and rate
of incentive payments, the Secretary may accord great significance to a practice that promotes residue, nutrient, pest,
invasive species, or air quality management.
‘‘(f) MODIFICATION OR TERMINATION OF CONTRACTS.—
‘‘(1) VOLUNTARY MODIFICATION OR TERMINATION.—The Secretary may modify or terminate a contract entered into with
a producer under this chapter if—
‘‘(A) the producer agrees to the modification or termination; and
‘‘(B) the Secretary determines that the modification
or termination is in the public interest.
‘‘(2) INVOLUNTARY TERMINATION.—The Secretary may
terminate a contract under this chapter if the Secretary determines that the producer violated the contract.

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‘‘(g) ALLOCATION OF FUNDING.—For each of fiscal years 2002
through 2007, 60 percent of the funds made available for costshare payments and incentive payments under this chapter shall
be targeted at practices relating to livestock production.

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16 USC
3839aa–3.

‘‘SEC. 1240C. EVALUATION OF OFFERS AND PAYMENTS.

16 USC
3839aa–4.

‘‘SEC. 1240D. DUTIES OF PRODUCERS.

16 USC
3839aa–5.

‘‘SEC. 1240E. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM PLAN.

11:42 Jun 07, 2002

‘‘In evaluating applications for cost-share payments and incentive payments, the Secretary shall accord a higher priority to assistance and payments that—
‘‘(1) encourage the use by producers of cost-effective conservation practices; and
‘‘(2) address national conservation priorities.
‘‘To receive technical assistance, cost-share payments, or incentive payments under the program, a producer shall agree—
‘‘(1) to implement an environmental quality incentives program plan (including a comprehensive nutrient management
plan, if applicable) that describes conservation and environmental purposes to be achieved through 1 or more practices
that are approved by the Secretary;
‘‘(2) not to conduct any practices on the farm or ranch
that would tend to defeat the purposes of the program;
‘‘(3) on the violation of a term or condition of the contract
at anytime the producer has control of the land—
‘‘(A) if the Secretary determines that the violation warrants termination of the contract—
‘‘(i) to forfeit all rights to receive payments under
the contract; and
‘‘(ii) to refund to the Secretary all or a portion
of the payments received by the owner or operator
under the contract, including any interest on the payments, as determined by the Secretary; or
‘‘(B) if the Secretary determines that the violation does
not warrant termination of the contract, to refund to the
Secretary, or accept adjustments to, the payments provided
to the owner or operator, as the Secretary determines to
be appropriate;
‘‘(4) on the transfer of the right and interest of the producer
in land subject to the contract, unless the transferee of the
right and interest agrees with the Secretary to assume all
obligations of the contract, to refund all cost-share payments
and incentive payments received under the program, as determined by the Secretary;
‘‘(5) to supply information as required by the Secretary
to determine compliance with the program plan and requirements of the program; and
‘‘(6) to comply with such additional provisions as the Secretary determines are necessary to carry out the program plan.
‘‘(a) IN GENERAL.—To be eligible to receive cost-share payments
or incentive payments under the program, a producer shall submit
to the Secretary for approval a plan of operations that—
‘‘(1) specifies practices covered under the program;
‘‘(2) includes such terms and conditions as the Secretary
considers necessary to carry out the program, including a

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description of the purposes to be met by the implementation
of the plan; and
‘‘(3) in the case of a confined livestock feeding operation,
provides for development and implementation of a comprehensive nutrient management plan, if applicable.
‘‘(b) AVOIDANCE OF DUPLICATION.—The Secretary shall, to the
maximum extent practicable, eliminate duplication of planning
activities under the program under this chapter and comparable
conservation programs.
‘‘SEC. 1240F. DUTIES OF THE SECRETARY.

‘‘To the extent appropriate, the Secretary shall assist a producer
in achieving the conservation and environmental goals of a program
plan by—
‘‘(1) providing cost-share payments or incentive payments
for developing and implementing 1 or more practices, as appropriate; and
‘‘(2) providing the producer with information and training
to aid in implementation of the plan.
‘‘SEC. 1240G. LIMITATION ON PAYMENTS.

‘‘An individual or entity may not receive, directly or indirectly,
cost-share or incentive payments under this chapter that, in the
aggregate, exceed $450,000 for all contracts entered into under
this chapter by the individual or entity during the period of fiscal
years 2002 through 2007, regardless of the number of contracts
entered into under this chapter by the individual or entity.
‘‘SEC. 1240H. CONSERVATION INNOVATION GRANTS.

‘‘(a) IN GENERAL.—The Secretary may pay the cost of competitive grants that are intended to stimulate innovative approaches
to leveraging Federal investment in environmental enhancement
and protection, in conjunction with agricultural production, through
the program.
‘‘(b) USE.—The Secretary may provide grants under this section
to governmental and nongovernmental organizations and persons,
on a competitive basis, to carry out projects that—
‘‘(1) involve producers that are eligible for payments or
technical assistance under the program;
‘‘(2) implement projects, such as—
‘‘(A) market systems for pollution reduction; and
‘‘(B) innovative conservation practices, including the
storing of carbon in the soil; and
‘‘(3) leverage funds made available to carry out the program
under this chapter with matching funds provided by State
and local governments and private organizations to promote
environmental enhancement and protection in conjunction with
agricultural production.
‘‘(c) COST SHARE.—The amount of a grant made under this
section to carry out a project shall not exceed 50 percent of the
cost of the project.
‘‘SEC. 1240I. GROUND AND SURFACE WATER CONSERVATION.

‘‘(a) ESTABLISHMENT.—In carrying out the program under this
chapter, subject to subsection (b), the Secretary shall promote
ground and surface water conservation by providing cost-share payments, incentive payments, and loans to producers to carry out

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3839aa–6.

16 USC
3839aa–7.

16 USC
3839aa–8.

16 USC
3839aa–9.

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eligible water conservation activities with respect to the agricultural
operations of producers, to—
‘‘(1) improve irrigation systems;
‘‘(2) enhance irrigation efficiencies;
‘‘(3) convert to—
‘‘(A) the production of less water-intensive agricultural
commodities; or
‘‘(B) dryland farming;
‘‘(4) improve the storage of water through measures such
as water banking and groundwater recharge;
‘‘(5) mitigate the effects of drought; or
‘‘(6) institute other measures that improve groundwater
and surface water conservation, as determined by the Secretary,
in the agricultural operations of producers.
‘‘(b) NET SAVINGS.—The Secretary may provide assistance to
a producer under this section only if the Secretary determines
that the assistance will facilitate a conservation measure that
results in a net savings in groundwater or surface water resources
in the agricultural operation of the producer.
‘‘(c) FUNDING.—Of the funds of the Commodity Credit Corporation, in addition to amounts made available under section 1241(a)(6)
to carry out this chapter, the Secretary shall use—
‘‘(1) to carry out this section—
‘‘(A) $25,000,000 for fiscal year 2002;
‘‘(B) $45,000,000 for fiscal year 2003; and
‘‘(C) $60,000,000 for each of fiscal years 2004 through
2007; and
‘‘(2) $50,000,000 to carry out water conservation activities
in Klamath Basin, California and Oregon, to be made available
as soon as practicable after the date of enactment of this
section.’’.

Subtitle E—Grassland Reserve
SEC. 2401. GRASSLAND RESERVE PROGRAM.

Chapter 2 of the Food Security Act of 1985 (as amended by
section 2001) is amended by adding at the end the following:
‘‘Subchapter C—Grassland Reserve Program
16 USC 3838n.

‘‘SEC. 1238N. GRASSLAND RESERVE PROGRAM.

‘‘(a) ESTABLISHMENT.—The Secretary shall establish a grassland
reserve program (referred to in this subchapter as the ‘program’)
to assist owners in restoring and conserving eligible land described
in subsection (c).
‘‘(b) ENROLLMENT CONDITIONS.—
‘‘(1) MAXIMUM ENROLLMENT.—The total number of acres
enrolled in the program shall not exceed 2,000,000 acres of
restored or improved grassland, rangeland, and pastureland.
‘‘(2) METHODS OF ENROLLMENT.—
‘‘(A) IN GENERAL.—Except as provided in subparagraph
(B), the Secretary shall enroll in the program from a willing
owner not less than 40 contiguous acres of land through
the use of—
‘‘(i) a 10-year, 15-year, or 20-year rental agreement;

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‘‘(ii)(I) a 30-year rental agreement or permanent
or 30-year easement; or
‘‘(II) in a State that imposes a maximum duration
for easements, an easement for the maximum duration
allowed under State law.
‘‘(B) WAIVER.—The Secretary may enroll in the program such parcels of land that are less than 40 acres
as the Secretary determines are appropriate to achieve
the purposes of the program.
‘‘(3) LIMITATION ON USE OF EASEMENTS AND RENTAL AGREEMENTS.—Of the total amount of funds expended under the
program to acquire easements and rental agreements described
in paragraph (2)(A)—
‘‘(A) not more than 40 percent shall be used for rental
agreements described in paragraph (2)(A)(i); and
‘‘(B) not more than 60 percent shall be used for easements and rental agreements described in paragraph
(2)(A)(ii).
‘‘(c) ELIGIBLE LAND.—Land shall be eligible to be enrolled in
the program if the Secretary determines that the land is private
land that is—
‘‘(1) grassland, land that contains forbs, or shrubland
(including improved rangeland and pastureland); or
‘‘(2) land that—
‘‘(A) is located in an area that has been historically
dominated by grassland, forbs, or shrubland; and
‘‘(B) has potential to serve as habitat for animal or
plant populations of significant ecological value if the land
is—
‘‘(i) retained in the current use of the land; or
‘‘(ii) restored to a natural condition; or
‘‘(3) land that is incidental to land described in paragraph
(1) or (2), if the incidental land is determined by the Secretary
to be necessary for the efficient administration of an agreement
or easement.
‘‘SEC. 1238O. REQUIREMENTS RELATING TO EASEMENTS AND AGREEMENTS.

16 USC 3838o.

‘‘(a) REQUIREMENTS OF LANDOWNER.—
‘‘(1) IN GENERAL.—To be eligible to enroll land in the program through the grant of an easement, the owner of the
land shall enter into an agreement with the Secretary—
‘‘(A) to grant an easement that applies to the land
to the Secretary;
‘‘(B) to create and record an appropriate deed restriction in accordance with applicable State law to reflect
the easement;
‘‘(C) to provide a written statement of consent to the
easement signed by persons holding a security interest
or any vested interest in the land;
‘‘(D) to provide proof of unencumbered title to the
underlying fee interest in the land that is the subject
of the easement; and
‘‘(E) to comply with the terms of the easement and
restoration agreement.

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‘‘(2) AGREEMENTS.—To be eligible to enroll land in the
program under an agreement, the owner or operator of the
land shall agree—
‘‘(A) to comply with the terms of the agreement
(including any related restoration agreements); and
‘‘(B) to the suspension of any existing cropland base
and allotment history for the land under a program
administered by the Secretary.
‘‘(b) TERMS OF EASEMENT OR RENTAL AGREEMENT.—An easement or rental agreement under subsection (a) shall—
‘‘(1) permit—
‘‘(A) common grazing practices, including maintenance
and necessary cultural practices, on the land in a manner
that is consistent with maintaining the viability of grassland, forb, and shrub species common to that locality;
‘‘(B) subject to appropriate restrictions during the
nesting season for birds in the local area that are in significant decline or are conserved in accordance with Federal
or State law, as determined by the Natural Resources
Conservation Service State conservationist, haying,
mowing, or harvesting for seed production; and
‘‘(C) fire rehabilitation and construction of fire breaks
and fences (including placement of the posts necessary
for fences);
‘‘(2) prohibit—
‘‘(A) the production of crops (other than hay), fruit
trees, vineyards, or any other agricultural commodity that
requires breaking the soil surface; and
‘‘(B) except as permitted under this subsection or subsection (d), the conduct of any other activity that would
disturb the surface of the land covered by the easement
or rental agreement; and
‘‘(3) include such additional provisions as the Secretary
determines are appropriate to carry out or facilitate the
administration of this subchapter.
‘‘(c) EVALUATION AND RANKING OF EASEMENT AND RENTAL
AGREEMENT APPLICATIONS.—
‘‘(1) IN GENERAL.—The Secretary shall establish criteria
to evaluate and rank applications for easements and rental
agreements under this subchapter.
‘‘(2) CONSIDERATIONS.—In establishing the criteria, the Secretary shall emphasize support for—
‘‘(A) grazing operations;
‘‘(B) plant and animal biodiversity; and
‘‘(C) grassland, land that contains forbs, and shrubland
under the greatest threat of conversion.
‘‘(d) RESTORATION AGREEMENTS.—
‘‘(1) IN GENERAL.—The Secretary shall prescribe the terms
of a restoration agreement by which grassland, land that contains forbs, or shrubland that is subject to an easement or
rental agreement entered into under the program shall be
restored.
‘‘(2) REQUIREMENTS.—The restoration agreement shall
describe the respective duties of the owner and the Secretary
(including the Federal share of restoration payments and technical assistance).

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‘‘(e) VIOLATIONS.—On a violation of the terms or conditions
of an easement, rental agreement, or restoration agreement entered
into under this section—
‘‘(1) the easement or rental agreement shall remain in
force; and
‘‘(2) the Secretary may require the owner to refund all
or part of any payments received by the owner under this
subchapter, with interest on the payments as determined appropriate by the Secretary.
‘‘SEC. 1238P. DUTIES OF SECRETARY.

16 USC 3838p.

‘‘(a) IN GENERAL.—In return for the granting of an easement,
or the execution of a rental agreement, by an owner under this
subchapter, the Secretary shall, in accordance with this section—
‘‘(1) make easement or rental agreement payments to the
owner in accordance with subsection (b); and
‘‘(2) make payments to the owner for the Federal share
of the cost of restoration in accordance with subsection (c).
‘‘(b) PAYMENTS.—
‘‘(1) EASEMENT PAYMENTS.—
‘‘(A) AMOUNT.—In return for the granting of an easement by an owner under this subchapter, the Secretary
shall make easement payments to the owner in an amount
equal to—
‘‘(i) in the case of a permanent easement, the fair
market value of the land less the grazing value of
the land encumbered by the easement; and
‘‘(ii) in the case of a 30-year easement or an easement for the maximum duration allowed under
applicable State law, 30 percent of the fair market
value of the land less the grazing value of the land
for the period during which the land is encumbered
by the easement.
‘‘(B) SCHEDULE.—Easement payments may be provided
in not less than 1 payment nor more than 10 annual
payments of equal or unequal amount, as agreed to by
the Secretary and the owner.
‘‘(2) RENTAL AGREEMENT PAYMENTS.—In return for entering
into a rental agreement by an owner under this subchapter,
the Secretary shall make annual payments to the owner during
the term of the rental agreement in an amount that is not
more than 75 percent of the grazing value of the land covered
by the contract.
‘‘(c) FEDERAL SHARE OF RESTORATION.—The Secretary shall
make payments to an owner under this section of not more than—
‘‘(1) in the case of grassland, land that contains forbs,
or shrubland that has never been cultivated, 90 percent of
the costs of carrying out measures and practices necessary
to restore functions and values of that land; or
‘‘(2) in the case of restored grassland, land that contains
forbs, or shrubland, 75 percent of those costs.
‘‘(d) PAYMENTS TO OTHERS.—If an owner that is entitled to
a payment under this subchapter dies, becomes incompetent, is
otherwise unable to receive the payment, or is succeeded by another
person who renders or completes the required performance, the
Secretary shall make the payment, in accordance with regulations
promulgated by the Secretary and without regard to any other

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provision of law, in such manner as the Secretary determines is
fair and reasonable in light of all the circumstances.
16 USC 3838q.

Deadline.

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‘‘SEC. 1238Q. DELEGATION TO PRIVATE ORGANIZATIONS.

‘‘(a) IN GENERAL.—The Secretary may permit a private conservation or land trust organization (referred to in this section
as a ‘private organization’) or a State agency to hold and enforce
an easement under this subchapter, in lieu of the Secretary, subject
to the right of the Secretary to conduct periodic inspections and
enforce the easement, if—
‘‘(1) the Secretary determines that granting the permission
will promote protection of grassland, land that contains forbs,
and shrubland;
‘‘(2) the owner authorizes the private organization or State
agency to hold and enforce the easement; and
‘‘(3) the private organization or State agency agrees to
assume the costs incurred in administering and enforcing the
easement, including the costs of restoration or rehabilitation
of the land as specified by the owner and the private organization or State agency.
‘‘(b) APPLICATION.—A private organization or State agency that
seeks to hold and enforce an easement under this subchapter shall
apply to the Secretary for approval.
‘‘(c) APPROVAL BY SECRETARY.—The Secretary may approve a
private organization to hold and enforce an easement under this
subchapter if (as determined by the Secretary) the private
organization—
‘‘(1)(A) is an organization described in section 501(c)(3)
of the Internal Revenue Code of 1986 that is exempt from
taxation under section 501(a) of that Code; or
‘‘(B) is described in section 509(a)(3), and is controlled
by an organization described in section 509(a)(2), of that Code;
‘‘(2) has the relevant experience necessary to administer
grassland and shrubland easements;
‘‘(3) has a charter that describes the commitment of the
private organization to conserving ranchland, agricultural land,
or grassland for grazing and conservation purposes; and
‘‘(4) has the resources necessary to effectuate the purposes
of the charter.
‘‘(d) REASSIGNMENT.—
‘‘(1) IN GENERAL.—If a private organization holding an easement on land under this subchapter terminates, not later than
30 days after termination of the private organization, the owner
of the land shall reassign the easement to—
‘‘(A) a new private organization that is approved by
the Secretary; or
‘‘(B) the Secretary.
‘‘(2) NOTIFICATION OF SECRETARY.—
‘‘(A) IN GENERAL.—If the easement is reassigned to
a new private organization, not later than 60 days after
the date of reassignment, the owner and the new organization shall notify the Secretary in writing that a reassignment for termination has been made.
‘‘(B) FAILURE TO NOTIFY.—If the owner and the new
organization fail to notify the Secretary of the reassignment
in accordance with subparagraph (A), the easement shall
revert to the control of the Secretary.’’.

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Subtitle F—Other Conservation Programs
SEC. 2501. AGRICULTURAL MANAGEMENT ASSISTANCE.

Section 524 of the Federal Crop Insurance Act (7 U.S.C. 1524)
is amended by striking subsection (b) and inserting the following:
‘‘(b) AGRICULTURAL MANAGEMENT ASSISTANCE.—
‘‘(1) AUTHORITY.—The Secretary shall provide financial
assistance to producers in the States of Connecticut, Delaware,
Maryland, Massachusetts, Maine, Nevada, New Hampshire,
New Jersey, New York, Pennsylvania, Rhode Island, Utah,
Vermont, West Virginia, and Wyoming.
‘‘(2) USES.—A producer may use financial assistance provided under this subsection to—
‘‘(A) construct or improve—
‘‘(i) watershed management structures; or
‘‘(ii) irrigation structures;
‘‘(B) plant trees to form windbreaks or to improve
water quality;
‘‘(C) mitigate financial risk through production or marketing diversification or resource conservation practices,
including—
‘‘(i) soil erosion control;
‘‘(ii) integrated pest management;
‘‘(iii) organic farming; or
‘‘(iv) to develop and implement a plan to create
marketing opportunities for the producer, including
through value-added processing;
‘‘(D) enter into futures, hedging, or options contracts
in a manner designed to help reduce production, price,
or revenue risk;
‘‘(E) enter into agricultural trade options as a hedging
transaction to reduce production, price, or revenue risk;
or
‘‘(F) conduct any other activity relating to an activity
described in subparagraphs (A) through (E), as determined
by the Secretary.
‘‘(3) PAYMENT LIMITATION.—The total amount of payments
made to a person (as defined in section 1001(5) of the Food
Security Act (7 U.S.C. 1308(5))) under this subsection for any
year may not exceed $50,000.
‘‘(4) COMMODITY CREDIT CORPORATION.—
‘‘(A) IN GENERAL.—The Secretary shall carry out this
subsection through the Commodity Credit Corporation.
‘‘(B) FUNDING.—
‘‘(i) IN GENERAL.—Except as provided in clause
(ii), the Commodity Credit Corporation shall make
available to carry out this subsection not less than
$10,000,000 for each fiscal year.
‘‘(ii) EXCEPTION.—For each of fiscal years 2003
through 2007, the Commodity Credit Corporation shall
make available to carry out this subsection
$20,000,000.’’.

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SEC. 2502. GRAZING, WILDLIFE HABITAT INCENTIVE, SOURCE WATER
PROTECTION, AND GREAT LAKES BASIN PROGRAMS.

(a) IN GENERAL.—Chapter 5 of subtitle D of title XII of the
Food Security Act of 1985 (16 U.S.C. 3839bb et seq.) is amended
to read as follows:
‘‘CHAPTER 5—OTHER CONSERVATION PROGRAMS
16 USC 3839bb.

‘‘SEC. 1240M. CONSERVATION OF PRIVATE GRAZING LAND.

‘‘(a) PURPOSE.—It is the purpose of this section to authorize
the Secretary to provide a coordinated technical, educational, and
related assistance program to conserve and enhance private grazing
land resources and provide related benefits to all citizens of the
United States by—
‘‘(1) establishing a coordinated and cooperative Federal,
State, and local grazing conservation program for management
of private grazing land;
‘‘(2) strengthening technical, educational, and related
assistance programs that provide assistance to owners and
managers of private grazing land;
‘‘(3) conserving and improving wildlife habitat on private
grazing land;
‘‘(4) conserving and improving fish habitat and aquatic
systems through grazing land conservation treatment;
‘‘(5) protecting and improving water quality;
‘‘(6) improving the dependability and consistency of water
supplies;
‘‘(7) identifying and managing weed, noxious weed, and
brush encroachment problems on private grazing land; and
‘‘(8) integrating conservation planning and management
decisions by owners and managers of private grazing land,
on a voluntary basis.
‘‘(b) DEFINITIONS.—In this section:
‘‘(1) DEPARTMENT.—The term ‘Department’ means the
Department of Agriculture.
‘‘(2) PRIVATE GRAZING LAND.—The term ‘private grazing
land’ means private, State-owned, tribally-owned, and any other
non-federally owned rangeland, pastureland, grazed forest land,
and hay land.
‘‘(3) SECRETARY.—The term ‘Secretary’ means the Secretary
of Agriculture.
‘‘(c) PRIVATE GRAZING LAND CONSERVATION ASSISTANCE.—
‘‘(1) ASSISTANCE TO GRAZING LANDOWNERS AND OTHERS.—
Subject to the availability of appropriations for this section,
the Secretary shall establish a voluntary program to provide
technical, educational, and related assistance to owners and
managers of private grazing land and public agencies, through
local conservation districts, to enable the landowners, managers, and public agencies to voluntarily carry out activities
that are consistent with this section, including—
‘‘(A) maintaining and improving private grazing land
and the multiple values and uses that depend on private
grazing land;
‘‘(B) implementing grazing land management technologies;
‘‘(C) managing resources on private grazing land,
including—

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‘‘(i) planning, managing, and treating private
grazing land resources;
‘‘(ii) ensuring the long-term sustainability of private grazing land resources;
‘‘(iii) harvesting, processing, and marketing private
grazing land resources; and
‘‘(iv) identifying and managing weed, noxious weed,
and brush encroachment problems;
‘‘(D) protecting and improving the quality and quantity
of water yields from private grazing land;
‘‘(E) maintaining and improving wildlife and fish
habitat on private grazing land;
‘‘(F) enhancing recreational opportunities on private
grazing land;
‘‘(G) maintaining and improving the aesthetic character
of private grazing land;
‘‘(H) identifying the opportunities and encouraging the
diversification of private grazing land enterprises; and
‘‘(I) encouraging the use of sustainable grazing systems,
such as year-round, rotational, or managed grazing.
‘‘(2) PROGRAM ELEMENTS.—
‘‘(A) FUNDING.—If funding is provided to carry out
this section, it shall be provided through a specific lineitem in the annual appropriations for the Natural
Resources Conservation Service.
‘‘(B) TECHNICAL ASSISTANCE AND EDUCATION.—Personnel of the Department trained in pasture and range
management shall be made available under the program
to deliver and coordinate technical assistance and education
to owners and managers of private grazing land, at the
request of the owners and managers.
‘‘(d) GRAZING TECHNICAL ASSISTANCE SELF-HELP.—
‘‘(1) FINDINGS.—Congress finds that—
‘‘(A) there is a severe lack of technical assistance for
farmers and ranchers that graze livestock;
‘‘(B) Federal budgetary constraints preclude any significant expansion, and may force a reduction of, current levels
of technical support; and
‘‘(C) farmers and ranchers have a history of cooperatively working together to address common needs in the
promotion of their products and in the drainage of wet
areas through drainage districts.
‘‘(2) ESTABLISHMENT OF GRAZING DEMONSTRATION.—In
accordance with paragraph (3), the Secretary may establish
2 grazing management demonstration districts at the recommendation of the grazing land conservation initiative
steering committee.
‘‘(3) PROCEDURE.—
‘‘(A) PROPOSAL.—Within a reasonable time after the
submission of a request of an organization of farmers or
ranchers engaged in grazing, the Secretary shall propose
that a grazing management district be established.
‘‘(B) FUNDING.—The terms and conditions of the
funding and operation of the grazing management district
shall be proposed by the producers.
‘‘(C) APPROVAL.—The Secretary shall approve the proposal if the Secretary determines that the proposal—

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‘‘(i) is reasonable;
‘‘(ii) will promote sound grazing practices; and
‘‘(iii) contains provisions similar to the provisions
contained in the beef promotion and research order
issued under section 4 of the Beef Research and
Information Act (7 U.S.C. 2903) in effect on April 4,
1996.
‘‘(D) AREA INCLUDED.—The area proposed to be
included in a grazing management district shall be determined by the Secretary on the basis of an application
by farmers or ranchers.
‘‘(E) AUTHORIZATION.—The Secretary may use
authority under the Agricultural Adjustment Act (7 U.S.C.
601 et seq.), reenacted with amendments by the Agricultural Marketing Agreement Act of 1937, to operate, on
a demonstration basis, a grazing management district.
‘‘(F) ACTIVITIES.—The activities of a grazing management district shall be scientifically sound activities, as
determined by the Secretary in consultation with a technical advisory committee composed of ranchers, farmers,
and technical experts.
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $60,000,000 for each
of fiscal years 2002 through 2007.
16 USC
3839bb–1.
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‘‘SEC. 1240N. WILDLIFE HABITAT INCENTIVE PROGRAM.

‘‘(a) IN GENERAL.—The Secretary, in consultation with the State
technical committees established under section 1261, shall establish
within the Natural Resources Conservation Service a program to
be known as the wildlife habitat incentive program (referred to
in this section as the ‘program’).
‘‘(b) COST-SHARE PAYMENTS.—
‘‘(1) IN GENERAL.—Under the program, the Secretary shall
make cost-share payments to landowners to develop—
‘‘(A) upland wildlife habitat;
‘‘(B) wetland wildlife habitat;
‘‘(C) habitat for threatened and endangered species;
‘‘(D) fish habitat; and
‘‘(E) other types of wildlife habitat approved by the
Secretary.
‘‘(2) INCREASED COST SHARE FOR LONG-TERM AGREEMENTS.—
‘‘(A) IN GENERAL.—In a case in which the Secretary
enters into an agreement or contract to protect and restore
plant and animal habitat that has a term of at least 15
years, the Secretary may provide cost-share payments in
addition to amounts provided under paragraph (1).
‘‘(B) FUNDING LIMITATION.—The Secretary may use,
for a fiscal year, not more than 15 percent of funds made
available under section 1241(a)(7) for the fiscal year to
carry out contracts and agreements described in subparagraph (A).
‘‘(c) REGIONAL EQUITY.—In carrying out this section, the Secretary shall, to the maximum extent practicable, ensure that
regional issues of concern relating to wildlife habitat are addressed
in an appropriate manner.

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‘‘SEC. 1240O. GRASSROOTS SOURCE WATER PROTECTION PROGRAM.

‘‘(a) IN GENERAL.—The Secretary shall establish a national
grassroots water protection program to more effectively use onsite
technical assistance capabilities of each State rural water association that, as of the date of enactment of this section, operates
a wellhead or groundwater protection program in the State.
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $5,000,000 for each
of fiscal years 2002 through 2007.
‘‘SEC. 1240P. GREAT LAKES BASIN PROGRAM FOR SOIL EROSION AND
SEDIMENT CONTROL.

16 USC
3839bb–2.

16 USC
3839bb–3.

‘‘(a) IN GENERAL.—The Secretary, in consultation with the
Great Lakes Commission created by Article IV of the Great Lakes
Basin Compact (82 Stat. 415) and in cooperation with the Administrator of the Environmental Protection Agency and the Secretary
of the Army, may carry out the Great Lakes basin program for
soil erosion and sediment control (referred to in this section as
the ‘program’).
‘‘(b) ASSISTANCE.—In carrying out the program, the Secretary
may—
‘‘(1) provide project demonstration grants, provide technical
assistance, and carry out information and education programs
to improve water quality in the Great Lakes basin by reducing
soil erosion and improving sediment control; and
‘‘(2) provide a priority for projects and activities that
directly reduce soil erosion or improve sediment control.
‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $5,000,000 for each
of fiscal years 2002 through 2007.’’.
(b) CONFORMING AMENDMENT.—Sections 386 and 387 of the
Federal Agriculture Improvement and Reform Act of 1996 (16 U.S.C.
2005b, 3836a) are repealed.
SEC. 2503. FARMLAND PROTECTION PROGRAM.

(a) IN GENERAL.—Chapter 2 of the Food Security Act of 1985
(as amended by section 2001) is amended by adding at the end
the following:
‘‘Subchapter B—Farmland Protection Program
‘‘SEC. 1238H. DEFINITIONS.

16 USC 3838h.

‘‘In this subchapter:
‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means—
‘‘(A) any agency of any State or local government or
an Indian tribe (including a farmland protection board
or land resource council established under State law); or
‘‘(B) any organization that—
‘‘(i) is organized for, and at all times since the
formation of the organization has been operated principally for, 1 or more of the conservation purposes
specified in clause (i), (ii), (iii), or (iv) of section
170(h)(4)(A) of the Internal Revenue Code of 1986;
‘‘(ii) is an organization described in section
501(c)(3) of that Code that is exempt from taxation
under section 501(a) of that Code;

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‘‘(iii) is described in section 509(a)(2) of that Code;
or
‘‘(iv) is described in section 509(a)(3), and is controlled by an organization described in section
509(a)(2), of that Code.
‘‘(2) ELIGIBLE LAND.—
‘‘(A) IN GENERAL.—The term ‘eligible land’ means land
on a farm or ranch that—
‘‘(i)(I) has prime, unique, or other productive soil;
or
‘‘(II) contains historical or archaeological resources;
and
‘‘(ii) is subject to a pending offer for purchase from
an eligible entity.
‘‘(B) INCLUSIONS.—The term ‘eligible land’ includes, on
a farm or ranch—
‘‘(i) cropland;
‘‘(ii) rangeland;
‘‘(iii) grassland;
‘‘(iv) pasture land; and
‘‘(v) forest land that is an incidental part of an
agricultural operation, as determined by the Secretary.
‘‘(3) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning
given the term in section 4 of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450b).
‘‘(4) PROGRAM.—The term ‘program’ means the farmland
protection program established under section 1238I(a).

16 USC 3838i.

‘‘SEC. 1238I. FARMLAND PROTECTION.

‘‘(a) IN GENERAL.—The Secretary, acting through the Natural
Resources Conservation Service, shall establish and carry out a
farmland protection program under which the Secretary shall purchase conservation easements or other interests in eligible land
that is subject to a pending offer from an eligible entity for the
purpose of protecting topsoil by limiting nonagricultural uses of
the land.
‘‘(b) CONSERVATION PLAN.—Any highly erodible cropland for
which a conservation easement or other interest is purchased under
this subchapter shall be subject to the requirements of a conservation plan that requires, at the option of the Secretary, the conversion
of the cropland to less intensive uses.
‘‘(c) COST SHARING.—
‘‘(1) FARMLAND PROTECTION.—
‘‘(A) SHARE PROVIDED UNDER THIS SUBSECTION.—The
share of the cost of purchasing a conservation easement
or other interest in eligible land described in subsection
(a) provided under section 1241(d) shall not exceed 50
percent of the appraised fair market value of the conservation easement or other interest in eligible land.
‘‘(B) SHARE NOT PROVIDED UNDER THIS SUBSECTION.—
As part of the share of the cost of purchasing a conservation
easement or other interest in eligible land described in
subsection (a) that is not provided under section 1241(d),
an eligible entity may include a charitable donation by
the private landowner from which the eligible land is to
be purchased of not more than 25 percent of the fair

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market value of the conservation easement or other interest
in eligible land.
‘‘(2) BIDDING DOWN.—If the Secretary determines that 2
or more applications for the purchase of a conservation easement or other interest in eligible land described in subsection
(a) are comparable in achieving the purposes of this section,
the Secretary shall not assign a higher priority to any 1 of
those applications solely on the basis of lesser cost to the
farmland protection program established under subsection (a).
‘‘SEC. 1238J. FARM VIABILITY PROGRAM.

16 USC 3838j.

‘‘(a) IN GENERAL.—The Secretary may provide to eligible entities identified by the Secretary grants for use in carrying out
farm viability programs developed by the eligible entities and
approved by the Secretary.
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to the Secretary to carry out this section such
sums as are necessary for each of fiscal years 2002 through 2007.’’.
(b) CONFORMING AMENDMENTS.—
(1) IN GENERAL.—
(A) Section 388 of the Federal Agriculture Improvement and Reform Act of 1996 (16 U.S.C. 3830 note; Public
Law 104–127) is repealed.
(B) Section 211 of the Agriculture Risk Protection Act
of 2000 (16 U.S.C. 3830 note; Public Law 106–224) is
amended—
(i) by striking subsection (a); and
(ii) in subsection (b)—
(I) by striking the subsection designation and
the subsection heading;
(II) by redesignating paragraphs (1), (2), and
(3) as subsections (a), (b), and (c), respectively,
and indenting appropriately;
(III) in subsection (a) (as so redesignated), by
redesignating subparagraphs (A), (B), and (C) as
paragraphs (1), (2), and (3), respectively, and
indenting appropriately;
(IV) in subsection (b) (as so redesignated), by
striking ‘‘ASSISTANCE’’ and inserting ‘‘ASSISTANCE’’;
and
(V) by striking ‘‘subsection’’ each place it
appears and inserting ‘‘section’’.
(2) EFFECT ON CONTRACTS.—The amendment made by paragraph (1)(A) shall have no effect on any contract entered into
under section 388 of the Federal Agriculture Improvement and
Reform Act of 1996 (16 U.S.C. 3830 note) that is in effect
as of the date of enactment of this Act.

16 USC 3830
note.

SEC. 2504. RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM.

Subtitle H of title XV of the Agriculture and Food Act of
1981 (16 U.S.C. 3451 et seq.) is amended to read as follows:

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‘‘Subtitle H—Resource Conservation and
Development Program
16 USC 3451.

‘‘SEC. 1528. DEFINITIONS.

‘‘In this subtitle:
‘‘(1) AREA PLAN.—The term ‘area plan’ means a resource
conservation and use plan developed through a planning process
by a council for a designated area of 1 or more States, or
of land under the jurisdiction of an Indian tribe, that includes
1 or more of the following elements:
‘‘(A) A land conservation element, the purpose of which
is to control erosion and sedimentation.
‘‘(B) A water management element that provides 1
or more clear environmental or conservation benefits, the
purpose of which is to provide for—
‘‘(i) the conservation, use, and quality of water,
including irrigation and rural water supplies;
‘‘(ii) the mitigation of floods and high water tables;
‘‘(iii) the repair and improvement of reservoirs;
‘‘(iv) the improvement of agricultural water
management; and
‘‘(v) the improvement of water quality.
‘‘(C) A community development element, the purpose
of which is to improve—
‘‘(i) the development of resources-based industries;
‘‘(ii) the protection of rural industries from natural
resource hazards;
‘‘(iii) the development of adequate rural water and
waste disposal systems;
‘‘(iv) the improvement of recreation facilities;
‘‘(v) the improvement in the quality of rural
housing;
‘‘(vi) the provision of adequate health and education facilities;
‘‘(vii) the satisfaction of essential transportation
and communication needs; and
‘‘(viii) the promotion of food security, economic
development, and education.
‘‘(D) A land management element, the purpose of which
is—
‘‘(i) energy conservation, including the production
of energy crops;
‘‘(ii) the protection of agricultural land, as appropriate, from conversion to other uses;
‘‘(iii) farmland protection; and
‘‘(iv) the protection of fish and wildlife habitats.
‘‘(2) BOARD.—The term ‘Board’ means the Resource Conservation and Development Policy Advisory Board established
under section 1533(a).
‘‘(3) COUNCIL.—The term ‘council’ means a nonprofit entity
(including an affiliate of the entity) operating in a State that
is—
‘‘(A) established by volunteers or representatives of
States, local units of government, Indian tribes, or local
nonprofit organizations to carry out an area plan in a
designated area; and

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‘‘(B) designated by the chief executive officer or legislature of the State to receive technical assistance and financial assistance under this subtitle.
‘‘(4) DESIGNATED AREA.—The term ‘designated area’ means
a geographic area designated by the Secretary to receive technical assistance and financial assistance under this subtitle.
‘‘(5) FINANCIAL ASSISTANCE.—The term ‘financial assistance’
means a grant or loan provided by the Secretary (or the Secretary and other Federal agencies) to, or a cooperative agreement entered into by the Secretary (or the Secretary and other
Federal agencies) with, a council, or association of councils,
to carry out an area plan in a designated area, including
assistance provided for planning, analysis, feasibility studies,
training, education, and other activities necessary to carry out
the area plan.
‘‘(6) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning
given the term in section 4 of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450b).
‘‘(7) LOCAL UNIT OF GOVERNMENT.—The term ‘local unit
of government’ means—
‘‘(A) any county, city, town, township, parish, village,
or other general-purpose subdivision of a State; and
‘‘(B) any local or regional special district or other limited political subdivision of a State, including any soil conservation district, school district, park authority, and water
or sanitary district.
‘‘(8) NONPROFIT ORGANIZATION.—The term ‘nonprofit
organization’ means any organization that is—
‘‘(A) described in section 501(c) of the Internal Revenue
Code of 1986; and
‘‘(B) exempt from taxation under section 501(a) of the
Internal Revenue Code of 1986.
‘‘(9) PLANNING PROCESS.—The term ‘planning process’
means actions taken by a council to develop and carry out
an effective area plan in a designated area, including development of the area plan, goals, purposes, policies, implementation
activities, evaluations and reviews, and the opportunity for
public participation in the actions.
‘‘(10) PROJECT.—The term ‘project’ means a project that
is carried out by a council to achieve any of the elements
of an area plan.
‘‘(11) SECRETARY.—The term ‘Secretary’ means the Secretary of Agriculture.
‘‘(12) STATE.—The term ‘State’ means—
‘‘(A) any State;
‘‘(B) the District of Columbia; or
‘‘(C) any territory or possession of the United States.
‘‘(13) TECHNICAL ASSISTANCE.—The term ‘technical assistance’ means any service provided by the Secretary or agent
of the Secretary, including—
‘‘(A) inventorying, evaluating, planning, designing,
supervising, laying out, and inspecting projects;
‘‘(B) providing maps, reports, and other documents
associated with the services provided;
‘‘(C) providing assistance for the long-term implementation of area plans; and

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‘‘(D) providing services of an agency of the Department
of Agriculture to assist councils in developing and carrying
out area plans.

16 USC 3452.

‘‘SEC. 1529. RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM.

Establishment.

‘‘The Secretary shall establish a resource conservation and
development program under which the Secretary shall provide technical assistance and financial assistance to councils to develop
and carry out area plans and projects in designated areas—
‘‘(1) to conserve and improve the use of land, develop natural resources, and improve and enhance the social, economic,
and environmental conditions in primarily rural areas of the
United States; and
‘‘(2) to encourage and improve the capability of State, units
of government, Indian tribes, nonprofit organizations, and councils to carry out the purposes described in paragraph (1).

16 USC 3453.

‘‘SEC. 1530. SELECTION OF DESIGNATED AREAS.

‘‘The Secretary shall select designated areas for assistance
under this subtitle on the basis of the elements of area plans.
16 USC 3454.

‘‘SEC. 1531. POWERS OF THE SECRETARY.

‘‘In carrying out this subtitle, the Secretary may—
‘‘(1) provide technical assistance to any council to assist
in developing and implementing an area plan for a designated
area;
‘‘(2) cooperate with other departments and agencies of the
Federal Government, States, local units of government, local
Indian tribes, and local nonprofit organizations in conducting
surveys and inventories, disseminating information, and developing area plans;
‘‘(3) assist in carrying out an area plan approved by the
Secretary for any designated area by providing technical assistance and financial assistance to any council; and
‘‘(4) enter into agreements with councils in accordance with
section 1532.
16 USC 3455.

‘‘SEC. 1532. ELIGIBILITY; TERMS AND CONDITIONS.

‘‘(a) ELIGIBILITY.—Technical assistance and financial assistance
may be provided by the Secretary under this subtitle to any council
to assist in carrying out a project specified in an area plan approved
by the Secretary only if—
‘‘(1) the council agrees in writing—
‘‘(A) to carry out the project; and
‘‘(B) to finance or arrange for financing of any portion
of the cost of carrying out the project for which financial
assistance is not provided by the Secretary under this
subtitle;
‘‘(2) the project is included in an area plan and is approved
by the council;
‘‘(3) the Secretary determines that assistance is necessary
to carry out the area plan;
‘‘(4) the project provided for in the area plan is consistent
with any comprehensive plan for the area;
‘‘(5) the cost of the land or an interest in the land acquired
or to be acquired under the plan by any State, local unit
of government, Indian tribe, or local nonprofit organization

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is borne by the State, local unit of government, Indian tribe,
or local nonprofit organization, respectively; and
‘‘(6) the State, local unit of government, Indian tribe, or
local nonprofit organization participating in the area plan
agrees to maintain and operate the project.
‘‘(b) LOANS.—
‘‘(1) IN GENERAL.—Subject to paragraphs (2) and (3), a
loan made under this subtitle shall be made on such terms
and conditions as the Secretary may prescribe.
‘‘(2) TERM.—A loan for a project made under this subtitle
shall have a term of not more than 30 years after the date
of completion of the project.
‘‘(3) INTEREST RATE.—A loan made under this subtitle shall
bear interest at the average rate of interest paid by the United
States on obligations of a comparable term, as determined
by the Secretary of the Treasury.
‘‘(c) APPROVAL BY SECRETARY.—Technical assistance and financial assistance under this subtitle may not be made available to
a council to carry out an area plan unless the area plan has
been submitted to and approved by the Secretary.
‘‘(d) WITHDRAWAL.—The Secretary may withdraw technical
assistance and financial assistance with respect to any area plan
if the Secretary determines that the assistance is no longer necessary or that sufficient progress has not been made toward developing or implementing the elements of the area plan.
‘‘SEC. 1533. RESOURCE CONSERVATION AND DEVELOPMENT POLICY
ADVISORY BOARD.

16 USC 3456.

‘‘(a) ESTABLISHMENT.—The Secretary shall establish within the
Department of Agriculture a Resource Conservation and Development Policy Advisory Board.
‘‘(b) COMPOSITION.—
‘‘(1) IN GENERAL.—The Board shall be composed of at least
7 employees of the Department of Agriculture selected by the
Secretary.
‘‘(2) CHAIRPERSON.—A member of the Board shall be designated by the Secretary to serve as chairperson of the Board.
‘‘(c) DUTIES.—The Board shall advise the Secretary regarding
the administration of this subtitle, including the formulation of
policies for carrying out this subtitle.
‘‘SEC. 1534. EVALUATION OF PROGRAM.

16 USC 3457.

‘‘(a) IN GENERAL.—The Secretary, in consultation with councils,
shall evaluate the program established under this subtitle to determine whether the program is effectively meeting the needs of,
and the purposes identified by, States, units of government, Indian
tribes, nonprofit organizations, and councils participating in, or
served by, the program.
‘‘(b) REPORT.—Not later than June 30, 2005, the Secretary
shall submit to the Committee on Agriculture of the House of
Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate a report describing the results of the evaluation, together with any recommendations of the Secretary for continuing, terminating, or modifying the program.

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16 USC 3458.

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‘‘SEC. 1535. LIMITATION ON ASSISTANCE.

‘‘In carrying out this subtitle, the Secretary shall provide technical assistance and financial assistance with respect to not more
than 450 active designated areas.
16 USC 3459.

‘‘SEC. 1536. SUPPLEMENTAL AUTHORITY OF THE SECRETARY.

‘‘The authority of the Secretary under this subtitle to assist
councils in the development and implementation of area plans shall
be supplemental to, and not in lieu of, any authority of the Secretary
under any other provision of law.
16 USC 3460.

‘‘SEC. 1537. AUTHORIZATION OF APPROPRIATIONS.

‘‘(a) IN GENERAL.—There are authorized to be such sums as
are necessary to carry out this subtitle.
‘‘(b) LOANS.—The Secretary shall not use more than $15,000,000
of any funds made available for a fiscal year to make loans under
this subtitle.
‘‘(c) AVAILABILITY.—Funds appropriated to carry out this subtitle shall remain available until expended.’’.
SEC. 2505. SMALL WATERSHED REHABILITATION PROGRAM.

Section 14 of the Watershed Protection and Flood Prevention
Act (16 U.S.C. 1012) is amended by striking subsection (h) and
inserting the following:
‘‘(h) FUNDING.—
‘‘(1) FUNDS OF COMMODITY CREDIT CORPORATION.—In carrying out this section, of the funds of the Commodity Credit
Corporation, the Secretary shall make available, to remain
available until expended—
‘‘(A) $45,000,000 for fiscal year 2003;
‘‘(B) $50,000,000 for fiscal year 2004;
‘‘(C) $55,000,000 for fiscal year 2005;
‘‘(D) $60,000,000 for fiscal year 2006;
‘‘(E) $65,000,000 for fiscal year 2007; and
‘‘(F) $0 for fiscal year 2008.
‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—In addition to
amounts made available under paragraph (1), there are authorized to be appropriated to the Secretary to carry out this
section, to remain available until expended—
‘‘(A) $45,000,000 for fiscal year 2003;
‘‘(B) $55,000,000 for fiscal year 2004;
‘‘(C) $65,000,000 for fiscal year 2005;
‘‘(D) $75,000,000 for fiscal year 2006; and
‘‘(E) $85,000,000 for fiscal year 2007.’’.
SEC. 2506. USE OF SYMBOLS, SLOGANS, AND LOGOS.
16 USC 5805.

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Section 356 of the Federal Agriculture Improvement Act of
1996 (16 U.S.C. 5801 et seq.) is amended—
(1) in subsection (c)—
(A) by redesignating paragraphs (4) through (7) as
paragraphs (5) through (8), respectively; and
(B) by inserting after paragraph (3) the following:
‘‘(4) on the written approval of the Secretary, to use, license,
or transfer symbols, slogans, and logos of the Foundation (exclusive of any symbol or logo of a governmental entity);’’; and
(2) in subsection (d), by adding at the end the following:
‘‘(3) USE OF SYMBOLS, SLOGANS, AND LOGOS OF THE FOUNDATION.—

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‘‘(A) IN GENERAL.—The Secretary may authorize the
Foundation to use, license, or transfer symbols, slogans,
and logos of the Foundation.
‘‘(B) INCOME.—
‘‘(i) IN GENERAL.—All revenue received by the
Foundation from the use, licensing, or transfer of symbols, slogans, and logos of the Foundation shall be
transferred to the Secretary.
‘‘(ii) CONSERVATION OPERATIONS.—The Secretary
shall transfer all revenue received under clause (i)
to the account within the Natural Resources Conservation Service that is used to carry out conservation
operations.’’.
SEC. 2507. DESERT TERMINAL LAKES.

‘‘(a) IN GENERAL.—Subject to subsection (b), as soon as practicable after the date of enactment of this Act, the Secretary of
Agriculture shall transfer $200,000,000 of the funds of the Commodity Credit Corporation to the Bureau of Reclamation Water
and Related Resources Account, which funds shall—
‘‘(1) be used by the Secretary of the Interior, acting through
the Commissioner of Reclamation, to provide water to at-risk
natural desert terminal lakes; and
‘‘(2) remain available until expended.
‘‘(b) LIMITATION.—The funds described in subsection (a) shall
not be used to purchase or lease water rights.

43 USC 2211
note.

Subtitle G—Conservation Corridor
Demonstration Program
SEC. 2601. DEFINITIONS.

In this subtitle:
(1) DELMARVA PENINSULA.—The term ‘‘Delmarva Peninsula’’ means land in the States of Delaware, Maryland, and
Virginia located on the east side of the Chesapeake Bay.
(2) DEMONSTRATION PROGRAM.—The term ‘‘demonstration
program’’ means the Conservation Corridor Demonstration Program established under this subtitle.
(3) CONSERVATION CORRIDOR PLAN; PLAN.—The terms ‘‘conservation corridor plan’’ and ‘‘plan’’ mean a conservation corridor plan required to be submitted and approved as a condition
for participation in the demonstration program.
(4) SECRETARY.—The term ‘‘Secretary’’ means the Secretary
of Agriculture.
SEC. 2602. CONSERVATION CORRIDOR DEMONSTRATION PROGRAM.

(a) ESTABLISHMENT.—The Secretary shall carry out a demonstration program, to be known as the ‘‘Conservation Corridor
Demonstration Program’’, under which any of the States of Delaware, Maryland, and Virginia, a local government of any 1 of
those States with jurisdiction over land on the Delmarva Peninsula,
or a combination of those States, may submit a conservation corridor
plan to integrate agriculture and forestry conservation programs
of the Department of Agriculture with State and local efforts to
address farm conservation needs.
(b) SUBMISSION OF CONSERVATION CORRIDOR PLAN.—

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note.

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(1) SUBMISSION AND PROPOSAL.—To be eligible to participate in the demonstration program, a State, local government,
or combination of States referred to in subsection (a) shall—
(A) submit to the Secretary a conservation corridor
plan that—
(i) proposes specific criteria and commitment of
resources in the geographic region designated in the
plan; and
(ii) describes how the linkage of Federal, State,
and local resources will improve—
(I) the economic viability of agriculture; and
(II) the environmental integrity of the watersheds in the Delmarva Peninsula; and
(B) demonstrate to the Secretary that, in developing
the plan, the State, local government, or combination of
States has solicited and taken into account the views of
local residents.
(2) DRAFT MEMORANDUM OF AGREEMENT.—If the conservation corridor plan is submitted by more than 1 State, the
plan shall provide a draft memorandum of agreement among
entities in each submitting State.
(c) REVIEW OF PLAN.—Not later than 90 days after the date
of receipt of a conservation corridor plan, the Secretary—
(1) shall review the plan; and
(2) may approve the plan for implementation under this
subtitle if the Secretary determines that the plan meets the
requirements specified in subsection (d).
(d) CRITERIA FOR APPROVAL.—The Secretary may approve a
conservation corridor plan only if, as determined by the Secretary,
the plan provides for each of the following:
(1) VOLUNTARY ACTIONS.—Actions taken under the plan—
(A) are voluntary;
(B) require the consent of willing landowners; and
(C) provide a mechanism by which the landowner may
withdraw such consent without adverse consequences other
than the loss of any payments to the landowner conditioned
on continued enrollment of the land.
(2) LAND OF HIGH CONSERVATION VALUE.—Criteria specified
in the plan ensure that land enrolled in each conservation
program incorporated through the plan are of exceptionally
high conservation value, as determined by the Secretary.
(3) NO EFFECT ON UNENROLLED LAND.—The enrollment of
land in a conservation program incorporated through the plan
will neither—
(A) adversely affect any adjacent land not so enrolled;
nor
(B) create any buffer zone on such unenrolled land.
(4) GREATER BENEFITS.—The conservation programs incorporated through the plan provide benefits greater than the
benefits that would likely be achieved through individual
application of the conservation programs.
(5) SUFFICIENT STAFFING.—Staffing, considering both Federal and non-Federal resources, is sufficient to ensure success
of the plan.

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SEC. 2603. IMPLEMENTATION OF CONSERVATION CORRIDOR PLAN.

(a) MEMORANDUM OF AGREEMENT.—On approval of a conservation corridor plan, the Secretary may enter into a memorandum
of agreement with the State, local government, or combination
of States that submitted the plan to—
(1) guarantee specific program resources for implementation of the plan;
(2) establish various compensation rates to the extent that
the parties to the agreement consider justified; and
(3) provide streamlined and integrated paperwork requirements.
(b) CONTINUED COMPLIANCE WITH PLAN APPROVAL CRITERIA.—
The Secretary shall terminate the memorandum of agreement
entered into under subsection (a) with respect to an approved
conservation corridor plan and cease the provision of resources
for implementation of the plan if the Secretary determines that,
in the implementation of the plan—
(1) the State, local government, or combination of States
that submitted the plan has deviated from—
(A) the plan;
(B) the criteria specified in section 2602(d) on which
approval of the plan was conditioned; or
(C) the cost-sharing requirements of section 2604(a)
or any other condition of the plan; or
(2) the economic viability of agriculture in the geographic
region designated in the plan is being hindered.
(c) PROGRESS REPORT.—At the end of the 3-year period that
begins on the date on which funds are first provided with respect
to a conservation corridor plan under the demonstration program,
the State, local government, or combination of States that submitted
the plan shall submit to the Secretary—
(1) a report on the effectiveness of the activities carried
out under the plan; and
(2) an evaluation of the economic viability of agriculture
in the geographic region designated in the plan.
(d) DURATION.—The demonstration program shall be carried
out for not less than 3 nor more than 5 years beginning on the
date on which funds are first provided under the demonstration
program.
SEC. 2604. FUNDING REQUIREMENTS.

(a) COST SHARING.—
(1) REQUIRED NON-FEDERAL SHARE.—Subject to paragraph
(2), as a condition on the approval of a conservation corridor
plan, the Secretary shall require the State and local participants to contribute financial resources sufficient to cover at
least 50 percent of the total cost of the activities carried out
under the plan.
(2) EXCEPTION.—The Secretary may reduce the cost-sharing
requirement in the case of a specific project or activity under
the demonstration program on good cause and on demonstration
that the project or activity is likely to achieve extraordinary
natural resource benefits.
(b) RESERVATION OF FUNDS.—The Secretary may consider
directing funds on a priority basis to the demonstration program
and to projects in areas identified by the plan.

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(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary to carry out this
subtitle for each of fiscal years 2002 through 2007.

Subtitle H—Funding and Administration
SEC. 2701. FUNDING AND ADMINISTRATION.

Subtitle E of the Food Security Act of 1985 is amended by
striking sections 1241 and 1242 (16 U.S.C. 3841, 3842) and inserting
the following:
16 USC 3841.

‘‘SEC. 1241. COMMODITY CREDIT CORPORATION.

‘‘(a) IN GENERAL.—For each of fiscal years 2002 through 2007,
the Secretary shall use the funds, facilities, and authorities of
the Commodity Credit Corporation to carry out the following programs under subtitle D (including the provision of technical assistance):
‘‘(1) The conservation reserve program under subchapter
B of chapter 1.
‘‘(2) The wetlands reserve program under subchapter C
of chapter 1.
‘‘(3) The conservation security program under subchapter
A of chapter 2.
‘‘(4) The farmland protection program under subchapter
B of chapter 2, using, to the maximum extent practicable—
‘‘(A) $50,000,000 in fiscal year 2002;
‘‘(B) $100,000,000 in fiscal year 2003;
‘‘(C) $125,000,000 in each of fiscal years 2004 and
2005;
‘‘(D) $100,000,000 in fiscal year 2006; and
‘‘(E) $97,000,000 in fiscal year 2007.
‘‘(5) The grassland reserve program under subchapter C
of chapter 2, using, to the maximum extent practicable
$254,000,000 for the period of fiscal years 2003 through 2007.
‘‘(6) The environmental quality incentives program under
chapter 4, using, to the maximum extent practicable—
‘‘(A) $400,000,000 in fiscal year 2002;
‘‘(B) $700,000,000 in fiscal year 2003;
‘‘(C) $1,000,000,000 in fiscal year 2004;
‘‘(D) $1,200,000,000 in each of fiscal years 2005 and
2006; and
‘‘(E) $1,300,000,000 in fiscal year 2007.
‘‘(7) The wildlife habitat incentives program under section
1240N, using, to the maximum extent practicable—
‘‘(A) $15,000,000 in fiscal year 2002;
‘‘(B) $30,000,000 in fiscal year 2003;
‘‘(C) $60,000,000 in fiscal year 2004; and
‘‘(D) $85,000,000 in each of fiscal years 2005 through
2007.
‘‘(b) SECTION 11.—Nothing in this section affects the limit on
expenditures for technical assistance imposed by section 11 of the
Commodity Credit Corporation Charter Act (15 U.S.C. 714i).
‘‘(c) REGIONAL EQUITY.—Before April 1 of each fiscal year, the
Secretary shall give priority for funding under the conservation

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programs under subtitle D (excluding the conservation reserve program under subchapter B of chapter 1, the wetlands reserve program under subchapter C of chapter 1, and the conservation security
program under subchapter A of chapter 2) to approved applications
in any State that has not received, for the fiscal year, an aggregate
amount of at least $12,000,000 for those conservation programs.
16 USC 3842.

‘‘SEC. 1242. DELIVERY OF TECHNICAL ASSISTANCE.

‘‘(a) IN GENERAL.—The Secretary shall provide technical assistance under this title to a producer eligible for that assistance—
‘‘(1) directly; or
‘‘(2) at the option of the producer, through a payment,
as determined by the Secretary, to the producer for an approved
third party, if available.
‘‘(b) CERTIFICATION OF THIRD-PARTY PROVIDERS.—
‘‘(1) IN GENERAL.—Not later than 180 days after the date
of enactment of the Farm Security and Rural Investment Act
of 2002, the Secretary shall, by regulation, establish a system
for—
‘‘(A) approving individuals and entities to provide technical assistance to carry out programs under this title
(including criteria for the evaluation of providers or potential providers of technical assistance); and
‘‘(B) establishing the amounts and methods for payments for that assistance.
‘‘(2) EXPERTISE.—In promulgating regulations to carry out
this subsection the Secretary shall ensure that persons with
expertise in the technical aspects of conservation planning,
watershed planning, environmental engineering (including
commercial entities, nonprofit entities, State or local governments or agencies, and other Federal agencies), are eligible
to become approved providers of the technical assistance.
‘‘(3) INTERIM ASSISTANCE.—
‘‘(A) IN GENERAL.—A person that has provided technical
assistance in accordance with an agreement between the
person and the Secretary before the date of enactment
of the Farm Security and Rural Investment Act of 2002
may continue to provide technical assistance under this
section until the date on which the Secretary establishes
the system described in paragraph (1).
‘‘(B) EVALUATION.—If a person described in subparagraph (A) seeks to continue to provide technical assistance
after the date referred to in subparagraph (A), the Secretary shall evaluate the person using criteria referred
to in paragraph (1).
‘‘(4) NON-FEDERAL ASSISTANCE.—The Secretary may request
the services of, and enter into cooperative agreements or contracts with, non-Federal entities to assist the Secretary in
providing technical assistance necessary to develop and implement conservation programs under this title.’’.
SEC. 2702. REGULATIONS.

(a) IN GENERAL.—Except as otherwise provided in this title
or an amendment made by this title, not later than 90 days after
the date of enactment of this Act, the Secretary of Agriculture,
in consultation with the Commodity Credit Corporation, shall
promulgate such regulations as are necessary to implement this
title.

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(b) APPLICABLE AUTHORITY.—The promulgation of regulations
under subsection (a) and administration of this title—
(1) shall—
(A) be carried out without regard to chapter 35 of
title 44, United States Code (commonly known as the
Paperwork Reduction Act); and
(B) the Statement of Policy of the Secretary of Agriculture effective July 24, 1971 (36 Fed. Reg. 13804) relating
to notices of proposed rulemaking and public participation
in rulemaking; and
(2) may—
(A) be promulgated with an opportunity for notice and
comment; or
(B) if determined to be appropriate by the Secretary
of Agriculture or the Commodity Credit Corporation, as
an interim rule effective on publication with an opportunity
for notice and comment.
(c) CONGRESSIONAL REVIEW OF AGENCY RULEMAKING.—In carrying out this section, the Secretary shall use the authority provided
under section 808(2) of title 5, United States Code.

TITLE III—TRADE
Subtitle A—Agricultural Trade Development and Assistance Act of 1954 and Related Statutes
SEC. 3001. UNITED STATES POLICY.

Section 2 of the Agricultural Trade Development and Assistance
Act of 1954 (7 U.S.C. 1691) is amended—
(1) in paragraph (4), by striking ‘‘and’’ at the end;
(2) in paragraph (5), by striking the period at the end
and inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(6) prevent conflicts.’’.
SEC. 3002. PROVISION OF AGRICULTURAL COMMODITIES.

Section 202 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1722) is amended—
(1) in subsection (b), by adding at the end the following:
‘‘(3) PROGRAM DIVERSITY.—The Administrator shall—
‘‘(A) encourage eligible organizations to propose and
implement program plans to address 1 or more aspects
of the program under section 201; and
‘‘(B) consider proposals that incorporate a variety of
program objectives and strategic plans based on the identification by eligible organizations of appropriate activities,
consistent with section 201, to assist development of foreign
countries.’’;
(2) in subsection (e)(1), by striking ‘‘not less than
$10,000,000, and not more than $28,000,000,’’ and inserting
‘‘not less than 5 percent nor more than 10 percent of the
funds’’; and
(3) by adding at the end the following:
‘‘(h) STREAMLINED PROGRAM MANAGEMENT.—

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‘‘(1) IMPROVEMENTS.—Not later than 1 year after the date
of enactment of this subsection, the Administrator shall—
‘‘(A) streamline program procedures and guidelines
under this title for agreements with eligible organizations
for programs in 1 or more countries; and
‘‘(B) effective beginning with fiscal year 2004, to the
maximum extent practicable, incorporate the changes into
the procedures and guidelines for programs and the guidelines for resource requests.
‘‘(2) STREAMLINED PROCEDURES AND GUIDELINES.—In carrying out paragraph (1), the Administrator shall make improvements in the Office of Food for Peace management systems
that include—
‘‘(A) expedition of and greater consistency in the program review and approval process under this title;
‘‘(B) streamlining of information collection and
reporting systems by identifying the critical information
that needs to be monitored and reported on by eligible
organizations; and
‘‘(C) for approved programs, provision of greater flexibility for an eligible organization to make modifications
in program activities to achieve program results with
streamlined procedures for reporting such modifications.
‘‘(3) CONSULTATION.—
‘‘(A) IN GENERAL.—Paragraphs (1) and (2) shall be carried out in accordance with section 205 and subsections
(b) and (c) of section 207.
‘‘(B) CONSULTATION WITH CONGRESSIONAL COMMITTEES.—Not later than 180 days after the date of enactment
of this subsection, the Administrator shall consult with
the Committee on Agriculture and the Committee on International Relations of the House of Representatives and
the Committee on Agriculture, Nutrition, and Forestry of
the Senate on progress made in carrying out this subsection.
‘‘(4) REPORT.—Not later than 270 days after the date of
enactment of this subsection, the Administrator shall submit
to the Committee on Agriculture and the Committee on International Relations of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the
Senate a report on the improvements made and planned
upgrades in the information management, procurement, and
financial management systems to administer this title.’’.

Deadline.

Deadline.

Deadline.

SEC. 3003. GENERATION AND USE OF CURRENCIES BY PRIVATE VOLUNTARY ORGANIZATIONS AND COOPERATIVES.

Section 203 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1723) is amended—
(1) in the section heading, by striking ‘‘FOREIGN’’;
(2) in subsection (a), by striking ‘‘the recipient country,
or in a country’’ and inserting ‘‘1 or more recipient countries,
or 1 or more countries’’;
(3) in subsection (b)—
(A) by striking ‘‘in recipient countries, or in countries’’
and inserting ‘‘1 or more recipient countries, or in 1 or
more countries’’; and
(B) by striking ‘‘foreign currency’’;

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PUBLIC LAW 107–171—MAY 13, 2002
(4) in subsection (c)—
(A) by striking ‘‘foreign currency’’; and
(B) by striking ‘‘the recipient country, or in a country’’
and inserting ‘‘1 or more recipient countries, or in 1 or
more countries’’; and
(5) in subsection (d)—
(A) by striking ‘‘Foreign currencies’’ and inserting ‘‘Proceeds’’;
(B) in paragraph (2)—
(i) by striking ‘‘income generating’’ and inserting
‘‘income-generating’’; and
(ii) by striking ‘‘the recipient country or within
a country’’ and inserting ‘‘1 or more recipient countries
or within 1 or more countries’’; and
(C) in paragraph (3)—
(i) by inserting a comma after ‘‘invested’’; and
(ii) by inserting a comma after ‘‘used’’.

SEC. 3004. LEVELS OF ASSISTANCE.

Section 204(a) of the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1724(a)) is amended—
(1) by striking ‘‘1996 through 2002’’ each place it appears
and inserting ‘‘2002 through 2007’’;
(2) in paragraph (1), by striking ‘‘2,025,000’’ and inserting
‘‘2,500,000’’; and
(3) in paragraph (2), by striking ‘‘1,550,000 metric tons’’
and inserting ‘‘1,875,000 metric tons’’.
SEC. 3005. FOOD AID CONSULTATIVE GROUP.

Section 205(f) of the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1725(f)) is amended by striking
‘‘2002’’ and inserting ‘‘2007’’.
SEC. 3006. MAXIMUM LEVEL OF EXPENDITURES.

Section 206 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1726) is repealed.
SEC. 3007. ADMINISTRATION.

Deadline.

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Section 207 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1726a) is amended—
(1) in subsection (a)—
(A) by redesignating paragraph (2) as paragraph (3);
and
(B) by striking paragraph (1) and inserting the following:
‘‘(1) RECIPIENT COUNTRIES.—A proposal to enter into a nonemergency food assistance agreement under this title shall
identify the recipient country or countries that are the subject
of the agreement.
‘‘(2) TIMING.—Not later than 120 days after the date of
receipt by the Administrator of a proposal submitted by an
eligible organization under this title, the Administrator shall
determine whether to accept the proposal.’’;
(2) in subsection (b), by striking ‘‘guideline’’ each place
it appears and inserting ‘‘guideline or annual policy guidance’’;
and
(3) by adding at the end the following:
‘‘(e) TIMELY APPROVAL.—

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‘‘(1) IN GENERAL.—The Administrator is encouraged to
finalize program agreements and resource requests for programs under this section before the beginning of each fiscal
year.
‘‘(2) REPORT.—Not later than December 1 of each year,
the Administrator shall submit to the Committee on Agriculture
and the Committee on International Relations of the House
of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that contains—
‘‘(A) a list of programs, countries, and commodities
approved to date for assistance under this section; and
‘‘(B) a statement of the total amount of funds approved
to date for transportation and administrative costs under
this section.’’.

Deadline.

SEC. 3008. ASSISTANCE FOR STOCKPILING AND RAPID TRANSPORTATION, DELIVERY, AND DISTRIBUTION OF SHELFSTABLE PREPACKAGED FOODS.

Section 208(f) of the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1726b(f)) is amended by striking
‘‘and 2002’’ and inserting ‘‘through 2007’’.
SEC. 3009. SALE PROCEDURE.

(a) IN GENERAL.—Section 403 of the Agricultural Trade
Development and Assistance Act of 1954 (7 U.S.C. 1733) is
amended—
(1) in subsection (e)—
(A) by striking ‘‘In carrying’’ and inserting the following:
‘‘(1) IN GENERAL.—In carrying’’; and
(B) by adding at the end the following:
‘‘(2) SALE PRICE.—Sales of agricultural commodities
described in paragraph (1) shall be made at a reasonable
market price in the economy where the agricultural commodity
is to be sold, as determined by the Secretary or the Administrator, as appropriate.’’; and
(2) by adding at the end the following:
‘‘(l) SALE PROCEDURE.—
‘‘(1) IN GENERAL.—Subsections (b) and (h) shall apply to
sales of commodities in recipient countries to generate proceeds
to carry out projects under—
‘‘(A) titles I and II;
‘‘(B) section 416(b) of the Agricultural Act of 1949
(7 U.S.C. 1431(b)); and
‘‘(C) the Food for Progress Act of 1985 (7 U.S.C. 1736o).
‘‘(2) CURRENCY.—A sale described in paragraph (1) may
be made in United States dollars or other currencies.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 416(b) of the Agricultural Act of 1949 (7 U.S.C.
1431(b)) is amended by adding at the end the following:
‘‘(10) SALE PROCEDURE.—In approving sales of commodities
under this subsection, the Secretary shall follow the sale procedure described in section 403(l) of the Agricultural Trade
Development and Assistance Act of 1954.’’.
(2) Subsection (f) of the Food for Progress Act of 1985
(7 U.S.C. 1736o(f)) is amended by adding at the end the following:

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‘‘(5) SALE PROCEDURE.—In making sales of eligible commodities under this section, the Secretary shall follow the sale
procedure described in section 403(l) of the Agricultural Trade
Development and Assistance Act of 1954.’’.

SEC. 3010. PREPOSITIONING.

Section 407(c)(4) of the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1736a(c)(4)) is amended by striking
‘‘and 2002’’ and inserting ‘‘through 2007’’.
SEC. 3011. TRANSPORTATION AND RELATED COSTS.

Section 407(c)(1) of the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1736a(c)(1)) is amended—
(1) by striking ‘‘The Administrator’’ and inserting the following:
‘‘(A) IN GENERAL.—The Administrator’’; and
(2) by adding at the end the following:
‘‘(B) CERTAIN COMMODITIES MADE AVAILABLE FOR NONEMERGENCY ASSISTANCE.—In the case of agricultural commodities made available for nonemergency assistance under title
II for least developed countries that meet the poverty and
other eligibility criteria established by the International Bank
for Reconstruction and Development for financing under the
International Development Association, the Administrator may
pay the transportation costs incurred in moving the agricultural
commodities from designated points of entry or ports of entry
abroad to storage and distribution sites and associated storage
and distribution costs.’’.
SEC. 3012. EXPIRATION DATE.

Section 408 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1736b) is amended by striking ‘‘2002’’
and inserting ‘‘2007’’.
SEC. 3013. MICRONUTRIENT FORTIFICATION PROGRAMS.

Deadline.

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Section 415 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1736g–2) is amended—
(1) in the section heading, by striking ‘‘PILOT PROGRAM.’’
and inserting ‘‘PROGRAMS.’’;
(2) in subsection (a)—
(A) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively, and adjusting the margins
appropriately;
(B) by striking the first sentence and inserting the
following:
‘‘(1) PROGRAMS.—Not later than September 30, 2003, the
Administrator, in consultation with the Secretary, shall establish micronutrient fortification programs.’’; and
(C) in the second sentence, by striking ‘‘The purpose
of the program’’ and inserting the following:
‘‘(2) PURPOSE.—The purpose of a program’’; and
(D) in paragraph (2) (as designated by subparagraph
(C))—
(i) in subparagraph (A), by striking ‘‘and’’ at the
end;
(ii) in subparagraph (B)—
(I) by striking ‘‘whole’’; and

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(II) by striking the period at the end and
inserting ‘‘; and’’; and
(iii) by adding at the end the following:
‘‘(C) assess and apply technologies and systems to
improve and ensure the quality, shelf life, bioavailability,
and safety of fortified food aid commodities, and products
of those commodities, that are provided to developing countries, by using the same mechanism that was used to
assess the micronutrient fortification program in the report
entitled ‘Micronutrient Compliance Review of Fortified P.L.
480 Commodities’, published October 2001 with funds from
the Bureau for Humanitarian Response of the United
States Agency for International Development.’’;
(3) in subsection (b), by striking ‘‘the pilot program’’ and
inserting ‘‘a program under this section’’;
(4) in the first sentence of subsection (c)—
(A) by striking ‘‘the pilot program, whole’’ and inserting
‘‘a program,’’;
(B) by striking ‘‘the pilot program may’’ and inserting
‘‘a program may’’;
(C) by striking ‘‘including’’ and inserting ‘‘such as’’;
and
(D) by striking ‘‘and iodine’’ and inserting ‘‘iodine, and
folic acid’’; and
(5) in subsection (d)—
(A) by striking ‘‘the pilot program’’ and inserting ‘‘programs’’; and
(B) by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 3014. JOHN OGONOWSKI FARMER-TO-FARMER PROGRAM.

Section 501 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1737) is amended to read as follows:
‘‘SEC. 501. JOHN OGONOWSKI FARMER-TO-FARMER PROGRAM.

‘‘(a) DEFINITIONS.—In this section:
‘‘(1) CARIBBEAN BASIN COUNTRY.—The term ‘Caribbean
Basin country’ means a country eligible for designation as
a beneficiary country under section 212 of the Caribbean Basin
Economic Recovery Act (19 U.S.C. 2702).
‘‘(2) EMERGING MARKET.—The term ‘emerging market’
means a country that the Secretary determines—
‘‘(A) is taking steps toward a market-oriented economy
through the food, agriculture, or rural business sectors
of the economy of the country; and
‘‘(B) has the potential to provide a viable and significant market for United States agricultural commodities
or products of United States agricultural commodities.
‘‘(3) MIDDLE INCOME COUNTRY.—The term ‘middle income
country’ means a country that has developed economically to
the point at which the country does not receive bilateral
development assistance from the United States.
‘‘(4) SUB-SAHARAN AFRICAN COUNTRY.—The term ‘sub-Saharan African country’ has the meaning given the term in section
107 of the Trade and Development Act of 2000 (19 U.S.C.
3706).
‘‘(b) PROVISION.—Notwithstanding any other provision of law,
to further assist developing countries, middle-income countries,
emerging markets, sub-Saharan African countries, and Caribbean

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Basin countries to increase farm production and farmer incomes,
the President may—
‘‘(1) establish and administer a program, to be known as
the ‘John Ogonowski Farmer-to-Farmer Program’, of farmerto-farmer assistance between the United States and such countries to assist in—
‘‘(A) increasing food production and distribution; and
‘‘(B) improving the effectiveness of the farming and
marketing operations of agricultural producers in those
countries;
‘‘(2)
use
United
States
agricultural
producers,
agriculturalists, colleges and universities (including historically
black colleges and universities, land grant colleges or universities, and foundations maintained by colleges or universities),
private agribusinesses, private organizations (including grassroots organizations with an established and demonstrated
capacity to carry out such a bilateral exchange program), private corporations, and nonprofit farm organizations to work
in conjunction with agricultural producers and farm organizations in those countries, on a voluntary basis—
‘‘(A) to improve agricultural and agribusiness operations and agricultural systems in those countries,
including improving—
‘‘(i) animal care and health;
‘‘(ii) field crop cultivation;
‘‘(iii) fruit and vegetable growing;
‘‘(iv) livestock operations;
‘‘(v) food processing and packaging;
‘‘(vi) farm credit;
‘‘(vii) marketing;
‘‘(viii) inputs; and
‘‘(ix) agricultural extension; and
‘‘(B) to strengthen cooperatives and other agricultural
groups in those countries;
‘‘(3) transfer the knowledge and expertise of United States
agricultural producers and businesses, on an individual basis,
to those countries while enhancing the democratic process by
supporting private and public agriculturally related organizations that request and support technical assistance activities
through cash and in-kind services;
‘‘(4) to the maximum extent practicable, make grants to
or enter into contracts or other cooperative agreements with
private voluntary organizations, cooperatives, land grant
universities, private agribusiness, or nonprofit farm organizations to carry out this section (except that any such contract
or other agreement may obligate the United States to make
outlays only to the extent that the budget authority for such
outlays is available under subsection (d) or has otherwise been
provided in advance in appropriation Acts);
‘‘(5) coordinate programs established under this section
with other foreign assistance programs and activities carried
out by the United States; and
‘‘(6) to the extent that local currencies can be used to
meet the costs of a program established under this section,
augment funds of the United States that are available for
such a program through the use, within the country in which
the program is being conducted, of—

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‘‘(A) foreign currencies that accrue from the sale of
agricultural commodities and products under this Act; and
‘‘(B) local currencies generated from other types of
foreign assistance activities.
‘‘(c) SPECIAL EMPHASIS ON SUB-SAHARAN AFRICAN AND CARIBBEAN BASIN COUNTRIES.—
‘‘(1) FINDINGS.—Congress finds that—
‘‘(A) agricultural producers in sub-Saharan African and
Caribbean Basin countries need training in agricultural
techniques that are appropriate for the majority of eligible
agricultural producers in those countries, including training
in—
‘‘(i) standard growing practices;
‘‘(ii) insecticide and sanitation procedures; and
‘‘(iii) other agricultural methods that will produce
increased yields of more nutritious and healthful crops;
‘‘(B) agricultural producers in the United States
(including African-American agricultural producers) and
banking and insurance professionals have agribusiness
expertise that would be invaluable for agricultural producers in sub-Saharan African and Caribbean Basin countries;
‘‘(C) a commitment by the United States is appropriate
to support the development of a comprehensive agricultural
skills training program for those agricultural producers
that focuses on—
‘‘(i) improving knowledge of insecticide and sanitation procedures to prevent crop destruction;
‘‘(ii) teaching modern agricultural techniques that
would facilitate a continual analysis of crop production,
including—
‘‘(I) the identification and development of
standard growing practices; and
‘‘(II) the establishment of systems for recordkeeping;
‘‘(iii) the use and maintenance of agricultural
equipment that is appropriate for the majority of
eligible agricultural producers in sub-Saharan African
or Caribbean Basin countries;
‘‘(iv) the expansion of small agricultural operations
into agribusiness enterprises by increasing access to
credit for agricultural producers through—
‘‘(I) the development and use of village banking
systems; and
‘‘(II) the use of agricultural risk insurance pilot
products; and
‘‘(v) marketing crop yields to prospective purchasers (including businesses and individuals) for local
needs and export; and
‘‘(D) programs that promote the exchange of agricultural knowledge and expertise through the exchange of
American and foreign agricultural producers have been
effective in promoting improved agricultural techniques and
food security and the extension of additional resources to
such farmer-to-farmer exchanges is warranted.
‘‘(2) GOALS FOR PROGRAMS CARRIED OUT IN SUB-SAHARAN
AFRICAN AND CARIBBEAN COUNTRIES.—The goals of programs

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carried out under this section in sub-Saharan African and
Caribbean Basin countries shall be—
‘‘(A) to expand small agricultural operations in those
countries into agribusiness enterprises by increasing access
to credit for agricultural producers through—
‘‘(i) the development and use of village banking
systems; and
‘‘(ii) the use of agricultural risk insurance pilot
products;
‘‘(B) to provide training to agricultural producers in
those countries that will—
‘‘(i) enhance local food security; and
‘‘(ii) help mitigate and alleviate hunger;
‘‘(C) to provide training to agricultural producers in
those countries in groups to encourage participants to share
and pass on to other agricultural producers in the home
communities of the participants, the information and skills
obtained from the training, rather than merely retaining
the information and skills for the personal enrichment
of the participants; and
‘‘(D) to maximize the number of beneficiaries of the
programs in sub-Saharan African and Caribbean Basin
countries.
‘‘(d) MINIMUM FUNDING.—Notwithstanding any other provision
of law, in addition to any funds that may be specifically appropriated to carry out this section, not less than 0.5 percent of the
amounts made available for each of fiscal years 2002 through 2007
to carry out this Act shall be used to carry out programs under
this section, with—
‘‘(1) not less than 0.2 percent to be used for programs
in developing countries; and
‘‘(2) not less than 0.1 percent to be used for programs
in sub-Saharan African and Caribbean Basin countries.
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) IN GENERAL.—There is authorized to be appropriated
to carry out programs under this section in sub-Saharan African
and Caribbean Basin countries $10,000,000 for each of fiscal
years 2002 through 2007.
‘‘(2) ADMINISTRATIVE COSTS.—Not more than 5 percent of
the funds made available for a fiscal year under paragraph
(1) may be used to pay administrative costs incurred in carrying
out programs in sub-Saharan African and Caribbean Basin
countries.’’.

Subtitle B—Agricultural Trade Act of 1978
SEC. 3101. EXPORTER ASSISTANCE INITIATIVE.

Title I of the Agricultural Trade Act of 1978 (7 U.S.C. 5601
et seq.) is amended by adding at the end the following:
7 USC 5607.

‘‘SEC. 107. EXPORTER ASSISTANCE INITIATIVE.

‘‘To provide a comprehensive source of information to facilitate
exports of United States agricultural commodities, the Secretary
shall maintain on a website on the Internet information to assist
exporters and potential exporters of United States agricultural
commodities.’’.

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SEC. 3102. EXPORT CREDIT GUARANTEE PROGRAM.

(a) TERMS OF SUPPLIER CREDIT PROGRAM.—Section 202(a) of
the Agricultural Trade Act of 1978 (7 U.S.C. 5622(a)) is amended
by adding at the end the following:
‘‘(3) EXTENDED SUPPLIER CREDITS.—
‘‘(A) IN GENERAL.—Subject to the appropriation of funds
under subparagraph (B), in carrying out this section, the
Commodity Credit Corporation may issue guarantees for
the repayment of credit made available for a period of
more than 180 days, but not more than 360 days, by
a United States exporter to a buyer in a foreign country.
‘‘(B) AUTHORIZATION OF APPROPRIATIONS.—There are
authorized to be appropriated such sums as are necessary
to fund the additional costs attributable to the portion
of any guarantee issued under this paragraph to cover
the repayment of credit beyond the initial 180-day period.’’.
(b) PROCESSED AND HIGH-VALUE PRODUCTS.—Section 202(k)(1)
of the Agricultural Trade Act of 1978 (7 U.S.C. 5622(k)(1)) is
amended by striking ‘‘, 2001, and 2002’’ and inserting ‘‘through
2007’’.
(c) REPORT.—Section 202 of the Agricultural Trade Act of 1978
(7 U.S.C. 5622) is amended by adding at the end the following:
‘‘(l) CONSULTATION ON AGRICULTURAL EXPORT CREDIT PROGRAMS.—The Secretary and the United States Trade Representative
shall consult on a regular basis with the Committee on Agriculture,
and the Committee on International Relations, of the House of
Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate on the status of multilateral negotiations
regarding agricultural export credit programs.’’.
(d) REAUTHORIZATION.—Section 211(b)(1) of the Agricultural
Trade Act of 1978 (7 U.S.C. 5641(b)(1)) is amended by striking
‘‘2002’’ and inserting ‘‘2007’’.
SEC. 3103. MARKET ACCESS PROGRAM.

Section 211(c) of the Agricultural Trade Act of 1978 (7 U.S.C.
5641(c)) is amended—
(1) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively, and indenting appropriately;
(2) by striking ‘‘The Commodity’’ and inserting the following:
‘‘(1) IN GENERAL.—The Commodity’’;
(3) by striking subparagraph (A) (as so redesignated) and
inserting the following:
‘‘(A) in addition to any funds that may be specifically
appropriated to implement a market access program, not
more than $90,000,000 for fiscal year 2001, $100,000,000
for fiscal year 2002, $110,000,000 for fiscal year 2003,
$125,000,000 for fiscal year 2004, $140,000,000 for fiscal
year 2005, and $200,000,000 for each of fiscal years 2006
and 2007, of the funds of, or an equal value of commodities
owned by, the Commodity Credit Corporation; and’’; and
(4) by adding at the end the following:
‘‘(2) PROGRAM PRIORITIES.—In providing any amount of
funds made available under paragraph (1)(A) for any fiscal
year that is in excess of the amount made available under
paragraph (1)(A) for fiscal year 2001, the Secretary shall, to
the maximum extent practicable—

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‘‘(A) give equal consideration to—
‘‘(i) proposals submitted by organizations that were
participating organizations in prior fiscal years; and
‘‘(ii) proposals submitted by eligible trade organizations that have not previously participated in the program established under this title; and
‘‘(B) give equal consideration to—
‘‘(i) proposals submitted for activities in emerging
markets; and
‘‘(ii) proposals submitted for activities in markets
other than emerging markets.’’.

SEC. 3104. EXPORT ENHANCEMENT PROGRAM.

(a) IN GENERAL.—Section 301(e)(1)(G) of the Agricultural Trade
Act of 1978 (7 U.S.C. 5651(e)(1)(G)) is amended by striking ‘‘fiscal
year 2002’’ and inserting ‘‘each of fiscal years 2002 through 2007’’.
(b) UNFAIR TRADE PRACTICES.—Section 102(5)(A) of the Agricultural Trade Act of 1978 (7 U.S.C. 5602(5)(A)) is amended—
(1) in clause (i), by striking ‘‘or’’ at the end; and
(2) by striking clause (ii) and inserting the following:
‘‘(ii) in the case of a monopolistic state trading
enterprise engaged in the export sale of an agricultural
commodity, implements a pricing practice that is inconsistent with sound commercial practice;
‘‘(iii) provides a subsidy that—
‘‘(I) decreases market opportunities for United
States exports; or
‘‘(II) unfairly distorts an agricultural market
to the detriment of United States exporters;
‘‘(iv) imposes an unfair technical barrier to trade,
including—
‘‘(I) a trade restriction or commercial requirement (such as a labeling requirement) that
adversely affects a new technology (including biotechnology); and
‘‘(II) an unjustified sanitary or phytosanitary
restriction (including any restriction that, in violation of the Uruguay Round Agreements, is not
based on scientific principles;
‘‘(v) imposes a rule that unfairly restricts imports
of United States agricultural commodities in the
administration of tariff rate quotas; or
‘‘(vi) fails to adhere to, or circumvents any obligation under, any provision of a trade agreement with
the United States.’’.
SEC. 3105. FOREIGN MARKET DEVELOPMENT COOPERATOR PROGRAM.

(a) VALUE-ADDED PRODUCTS.—
(1) IN GENERAL.—Section 702(a) of the Agricultural Trade
Act of 1978 (7 U.S.C. 5722(a)) is amended by inserting ‘‘,
with a continued significant emphasis on the importance of
the export of value-added United States agricultural products
into emerging markets’’ after ‘‘products’’.
(2) REPORT TO CONGRESS.—Section 702 of the Agricultural
Trade Act of 1978 (7 U.S.C. 5722) is amended by adding at
the end the following:
‘‘(c) REPORT TO CONGRESS.—The Secretary shall annually
submit to the Committee on Agriculture and the Committee on

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International Relations of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the Senate
a report on activities under this section describing the amount
of funding provided, the types of programs funded, the value-added
products that have been targeted, and the foreign markets for
those products that have been developed.’’.
(b) FUNDING.—Section 703 of the Agricultural Trade Act of
1978 (7 U.S.C. 5723) is amended to read as follows:
‘‘SEC. 703. FUNDING.

‘‘(a) IN GENERAL.—To carry out this title, the Secretary shall
use funds of the Commodity Credit Corporation, or commodities
of the Commodity Credit Corporation of a comparable value, in
the amount of $34,500,000 for each of fiscal years 2002 through
2007.
‘‘(b) PROGRAM PRIORITIES.—In providing any amount of funds
or commodities made available under subsection (a) for any fiscal
year that is in excess of the amount made available under this
section for fiscal year 2001, the Secretary shall, to the maximum
extent practicable—
‘‘(1) give equal consideration to—
‘‘(A) proposals submitted by organizations that were
participating organizations in prior fiscal years; and
‘‘(B) proposals submitted by eligible trade organizations
that have not previously participated in the program established under this title; and
‘‘(2) give equal consideration to—
‘‘(A) proposals submitted for activities in emerging markets; and
‘‘(B) proposals submitted for activities in markets other
than emerging markets.’’.
SEC. 3106. FOOD FOR PROGRESS.

(a) IN GENERAL.—Subsections (f)(3), (k), and (l)(1) of the Food
for Progress Act of 1985 (7 U.S.C. 1736o) are each amended by
striking ‘‘2002’’ and inserting ‘‘2007’’.
(b) DEFINITIONS; PROGRAM.—
(1) IN GENERAL.—The Food for Progress Act of 1985 (7
U.S.C. 1736o) is amended by striking subsections (b) and (c)
and inserting the following:
‘‘(b) DEFINITIONS.—In this section:
‘‘(1) COOPERATIVE.—The term ‘cooperative’ has the meaning
given the term in section 402 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1732).
‘‘(2) CORPORATION.—The term ‘Corporation’ means the
Commodity Credit Corporation.
‘‘(3) DEVELOPING COUNTRY.—The term ‘developing country’
has the meaning given the term in section 402 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C.
1732).
‘‘(4) ELIGIBLE COMMODITY.—The term ‘eligible commodity’
means an agricultural commodity, or a product of an agricultural commodity, in inventories of the Corporation or acquired
by the President or the Corporation for disposition through
commercial purchases under a program authorized under this
section.
‘‘(5) ELIGIBLE ENTITY.—The term ‘eligible entity’ means—

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‘‘(A) the government of an emerging agricultural
country;
‘‘(B) an intergovernmental organization;
‘‘(C) a private voluntary organization;
‘‘(D) a nonprofit agricultural organization or cooperative;
‘‘(E) a nongovernmental organization; and
‘‘(F) any other private entity.
‘‘(6) FOOD SECURITY.—The term ‘food security’ means access
by all people at all times to sufficient food and nutrition for
a healthy and productive life.
‘‘(7) NONGOVERNMENTAL ORGANIZATION.—The term ‘nongovernmental organization’ has the meaning given the term
in section 402 of the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1732).
‘‘(8) PRIVATE VOLUNTARY ORGANIZATION.—The term ‘private
voluntary organization’ has the meaning given the term in
section 402 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1732).
‘‘(9) PROGRAM.—The term ‘program’ means a food assistance or development initiative proposed by an eligible entity
and approved by the President under this section.
‘‘(c) PROGRAM.—In order to use the food resources of the United
States more effectively in support of developing countries, and
countries that are emerging democracies that have made commitments to introduce or expand free enterprise elements in their
agricultural economies through changes in commodity pricing, marketing, input availability, distribution, and private sector involvement, the President may enter into agreements with eligible entities
to furnish to the countries eligible commodities made available
under subsections (e) and (f).’’.
(2) CONFORMING AMENDMENTS.—The Food for Progress Act
of 1985 (7 U.S.C. 136o) is amended—
(A) in the first sentence of subsection (d), by striking
‘‘food’’;
(B) in subsection (l)(2), by striking ‘‘agricultural’’;
(C) in subsection (m)(1), by striking ‘‘these’’;
(D) in subsections (d), (e), (f), (h), (j), (l), and (m),
by striking ‘‘commodities’’ each place it appears and
inserting ‘‘eligible commodities’’;
(E) in subsections (e), (f), and (l), by striking ‘‘Commodity Credit Corporation’’ each place it appears and
inserting ‘‘Corporation’’; and
(F) by striking subsection (o).
(c) CONSIDERATION FOR AGREEMENTS.—Subsection (d) of the
Food for Progress Act of 1985 (7 U.S.C. 1736o(d)) is amended
by striking ‘‘(d) In determining’’ and inserting ‘‘(d) CONSIDERATION
FOR AGREEMENTS.—In determining’’.
(d) FUNDING OF ELIGIBLE COMMODITIES.—Subsection (e) of the
Food for Progress Act of 1985 (7 U.S.C. 1736o(e)) is amended—
(1) by striking ‘‘(e)’’ and inserting ‘‘(e) FUNDING OF ELIGIBLE
COMMODITIES.—’’;
(2) in paragraph (2), by inserting ‘‘, and subsection (g)
does not apply to eligible commodities furnished on a grant
basis or on credit terms under that title’’ before the period
at the end; and
(3) by adding at the end the following:

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‘‘(5) NO EFFECT ON DOMESTIC PROGRAMS.—The President
shall not make an eligible commodity available for disposition
under this section in any amount that will reduce the amount
of the eligible commodity that is traditionally made available
through donations to domestic feeding programs or agencies,
as determined by the President.’’.
(e) PROVISION OF ELIGIBLE COMMODITIES TO DEVELOPING COUNTRIES.—Subsection (f) of the Food for Progress Act of 1985 (7 U.S.C.
1736o(f)) is amended—
(1) by striking ‘‘(f)’’ and inserting ‘‘(f) PROVISION OF
ELIGIBLE COMMODITIES TO DEVELOPING COUNTRIES.—’’; and
(2) in paragraph (3), by striking ‘‘$30,000,000 (or in the
case of fiscal year 1999, $35,000,000)’’ and inserting
‘‘$40,000,000’’.
(f) MINIMUM TONNAGE.—The Food for Progress Act of 1985
is amended by striking subsection (g) (7 U.S.C. 1736o(g)) and
inserting the following:
‘‘(g) MINIMUM TONNAGE.—Subject to subsection (f)(3), not less
than 400,000 metric tons of eligible commodities may be provided
under this section for the program for each of fiscal years 2002
through 2007.’’.
(g) PROHIBITION ON RESALE OR TRANSSHIPMENT OF ELIGIBLE
COMMODITIES.—Subsection (h) of the Food for Progress Act of 1985
(7 U.S.C. 1736o(h)) is amended by striking ‘‘(h) An agreement’’
and inserting ‘‘(h) PROHIBITION ON RESALE OR TRANSSHIPMENT OF
ELIGIBLE COMMODITIES.—An agreement’’.
(h) DISPLACEMENT OF UNITED STATES COMMERCIAL SALES.—
Subsection (i) of the Food for Progress Act of 1985 (7 U.S.C. 1736o(i))
is amended by striking ‘‘(i) In entering’’ and inserting ‘‘(i) DISPLACEMENT OF UNITED STATES COMMERCIAL SALES.—In entering’’.
(i) MULTICOUNTRY OR MULTIYEAR BASIS.—Subsection (j) of the
Food for Progress Act of 1985 (7 U.S.C. 1736o(j)) is amended—
(1) by striking ‘‘(j) In carrying out this section, the President
may,’’ and inserting the following: ‘‘(j) MULTICOUNTRY OR
MULTIYEAR BASIS.—
‘‘(1) IN GENERAL.—In carrying out this section, the President,’’;
(2) by striking ‘‘approve’’ and inserting ‘‘is encouraged to
approve’’;
(3) by striking ‘‘multiyear’’ and inserting ‘‘multicountry or
multiyear’’; and
(4) by adding at the end the following:
‘‘(2) DEADLINE FOR PROGRAM ANNOUNCEMENTS.—Before the
beginning of any fiscal year, the President shall, to the maximum extent practicable—
‘‘(A) make all determinations concerning program
agreements and resource requests for programs under this
section; and
‘‘(B) announce those determinations.
‘‘(3) REPORT.—Not later than December 1 of each fiscal
year, the President shall submit to the Committee on Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a list
of programs, countries, and eligible commodities, and the total
amount of funds for transportation and administrative costs,
approved to date for the fiscal year under this section.’’.

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President.

Deadline.

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(j) EFFECTIVE AND TERMINATION DATES.—Subsection (k) of the
Food for Progress Act of 1985 (7 U.S.C. 1736o(k)) is amended
by striking ‘‘(k) This section’’ and inserting ‘‘(k) EFFECTIVE AND
TERMINATION DATES.—This section’’.
(k) ADMINISTRATIVE EXPENSES.—Subsection (l) of the Food for
Progress Act of 1985 (7 U.S.C. 1736o(l)) is amended—
(1) by striking ‘‘(l)’’ and inserting ‘‘(l) ADMINISTRATIVE
EXPENSES.—’’;
(2) in paragraph (1), by striking ‘‘$10,000,000’’ and inserting
‘‘$15,000,000’’;
(3) in paragraph (3), by striking ‘‘local currencies’’ and
inserting ‘‘proceeds’’; and
(4) by adding at the end the following:
‘‘(4) HUMANITARIAN OR DEVELOPMENT PURPOSES.—The Secretary may authorize the use of proceeds to pay the costs
incurred by an eligible entity under this section for—
‘‘(A)(i) programs targeted at hunger and malnutrition;
or
‘‘(ii) development programs involving food security;
‘‘(B) transportation, storage, and distribution of eligible
commodities provided under this section; and
‘‘(C) administration, sales, monitoring, and technical
assistance.’’.
(l) PRESIDENTIAL APPROVAL.—Subsection (m) of the Food for
Progress Act of 1985 (7 U.S.C. 1736o(m)) is amended by striking
‘‘(m) In carrying’’ and inserting ‘‘(m) PRESIDENTIAL APPROVAL.—
In carrying’’.
(m) PROGRAM MANAGEMENT.—The Food for Progress Act of
1985 is amended by striking subsection (n) (7 U.S.C. 1736o(n))
and inserting the following:
‘‘(n) PROGRAM MANAGEMENT.—
‘‘(1) IN GENERAL.—The President shall ensure, to the maximum extent practicable, that each eligible entity participating
in 1 or more programs under this section—
‘‘(A) uses eligible commodities made available under
this section—
‘‘(i) in an effective manner;
‘‘(ii) in the areas of greatest need; and
‘‘(iii) in a manner that promotes the purposes of
this section;
‘‘(B) in using eligible commodities, assesses and takes
into account the needs of recipient countries and the target
populations of the recipient countries;
‘‘(C) works with recipient countries, and indigenous
institutions or groups in recipient countries, to design and
carry out mutually acceptable programs authorized under
this section; and
‘‘(D) monitors and reports on the distribution or sale
of eligible commodities provided under this section using
methods that, as determined by the President, facilitate
accurate and timely reporting.
‘‘(2) REQUIREMENTS.—
‘‘(A) IN GENERAL.—Not later than 270 days after the
date of enactment of this paragraph, the President shall
review and, as necessary, make changes in regulations
and internal procedures designed to streamline, improve,

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and clarify the application, approval, and implementation
processes pertaining to agreements under this section.
‘‘(B) CONSIDERATIONS.—In conducting the review, the
President shall consider—
‘‘(i) revising procedures for submitting proposals;
‘‘(ii) developing criteria for program approval that
separately address the objectives of the program;
‘‘(iii) pre-screening organizations and proposals to
ensure that the minimum qualifications are met;
‘‘(iv) implementing e-government initiatives and
otherwise improving the efficiency of the proposal
submission and approval processes;
‘‘(v) upgrading information management systems;
‘‘(vi) improving commodity and transportation
procurement processes; and
‘‘(vii) ensuring that evaluation and monitoring
methods are sufficient.
‘‘(C) CONSULTATIONS.—Not later than 1 year after the
date of enactment of this paragraph, the President shall
consult with the Committee on Agriculture, and the Committee on International Relations, of the House of Representatives and the Committee on Agriculture, Nutrition,
and Forestry of the Senate on changes made in regulations
and procedures.
‘‘(3) REPORTS.—Each eligible entity that enters into an
agreement under this section shall submit to the President,
at such time as the President may request, a report containing
such information as the President may request relating to
the use of eligible commodities and funds furnished to the
eligible entity under this section.’’.
SEC. 3107. MCGOVERN-DOLE INTERNATIONAL FOOD FOR EDUCATION
AND CHILD NUTRITION PROGRAM.

Deadline.

7 USC 1736o–1.

(a) DEFINITION OF AGRICULTURAL COMMODITY.—In this section,
the term ‘‘agricultural commodity’’ means an agricultural commodity, or a product of an agricultural commodity, that is produced
in the United States.
(b) PROGRAM.—Subject to subsection (l), the President may
establish a program, to be known as ‘‘McGovern-Dole International
Food for Education and Child Nutrition Program’’, requiring the
procurement of agricultural commodities and the provision of financial and technical assistance to carry out—
(1) preschool and school food for education programs in
foreign countries to improve food security, reduce the incidence
of hunger, and improve literacy and primary education, particularly with respect to girls; and
(2) maternal, infant, and child nutrition programs for pregnant women, nursing mothers, infants, and children who are
5 years of age or younger.
(c) ELIGIBLE COMMODITIES AND COST ITEMS.—Notwithstanding
any other provision of law—
(1) any agricultural commodity is eligible to be provided
under this section;
(2) as necessary to achieve the purposes of this section,
funds appropriated under this section may be used to pay—
(A)(i) the cost of acquiring agricultural commodities;

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(ii) the costs associated with packaging, enrichment,
preservation, and fortification of agricultural commodities;
(iii) the processing, transportation, handling, and other
incidental costs up to the time of the delivery of agricultural
commodities free on board vessels in United States ports;
(iv) the vessel freight charges from United States ports
or designated Canadian transshipment ports, as determined by the Secretary, to designated ports of entry abroad;
(v) the costs associated with transporting agricultural
commodities from United States ports to designated points
of entry abroad in the case—
(I) of landlocked countries;
(II) of ports that cannot be used effectively because
of natural or other disturbances;
(III) of the unavailability of carriers to a specific
country; or
(IV) of substantial savings in costs or time that
may be effected by the utilization of points of entry
other than ports; and
(vi) the charges for general average contributions
arising out of the ocean transport of agricultural commodities transferred pursuant thereto;
(B) all or any part of the internal transportation, storage, and handling costs incurred in moving the eligible
commodity, if the President determines that—
(i) payment of the costs is appropriate; and
(ii) the recipient country is a low income, net foodimporting country that—
(I) meets the poverty criteria established by
the International Bank for Reconstruction and
Development for Civil Works Preference; and
(II) has a national government that is committed to or is working toward, through a national
action plan, the goals of the World Declaration
on Education for All convened in 1990 in Jomtien,
Thailand, and the followup Dakar Framework for
Action of the World Education Forum, convened
in 2000;
(C) the costs of activities conducted in the recipient
countries by a nonprofit voluntary organization, cooperative, or intergovernmental agency or organization that
would enhance the effectiveness of the activities implemented by such entities under this section; and
(D) the costs of meeting the allowable administrative
expenses of private voluntary organizations, cooperatives,
or intergovernmental organizations that are implementing
activities under this section.
(d) GENERAL AUTHORITIES.—The President shall designate 1
or more Federal agencies to—
(1) implement the program established under this section;
(2) ensure that the program established under this section
is consistent with the foreign policy and development assistance
objectives of the United States; and
(3) consider, in determining whether a country should
receive assistance under this section, whether the government
of the country is taking concrete steps to improve the preschool
and school systems in the country.

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(e) ELIGIBLE ENTITIES.—Assistance may be provided under this
section to private voluntary organizations, cooperatives, intergovernmental organizations, governments of developing countries and
their agencies, and other organizations.
(f) PROCEDURES.—
(1) IN GENERAL.—In carrying out subsection (b), the President shall ensure that procedures are established that—
(A) provide for the submission of proposals by eligible
entities, each of which may include 1 or more recipient
countries, for commodities and other assistance under this
section;
(B) provide for eligible commodities and assistance on
a multiyear basis;
(C) ensure that eligible entities demonstrate the
organizational capacity and the ability to develop, implement, monitor, report on, and provide accountability for
activities conducted under this section;
(D) provide for the expedited development, review, and
approval of proposals submitted in accordance with this
section;
(E) ensure monitoring and reporting by eligible entities
on the use of commodities and other assistance provided
under this section; and
(F) allow for the sale or barter of commodities by
eligible entities to acquire funds to implement activities
that improve the food security of women and children or
otherwise enhance the effectiveness of programs and activities authorized under this section.
(2) PRIORITIES FOR PROGRAM FUNDING.—In carrying out
paragraph (1) with respect to criteria for determining the use
of commodities and other assistance provided for programs
and activities authorized under this section, the implementing
agency may consider the ability of eligible entities to—
(A) identify and assess the needs of beneficiaries, especially malnourished or undernourished mothers and their
children who are 5 years of age or younger, and schoolage children who are malnourished, undernourished, or
do not regularly attend school;
(B)(i) in the case of preschool and school-age children,
target low-income areas where children’s enrollment and
attendance in school is low or girls’ enrollment and participation in preschool or school is low, and incorporate
developmental objectives for improving literacy and primary education, particularly with respect to girls; and
(ii) in the case of programs to benefit mothers and
children who are 5 years of age or younger, coordinate
supplementary feeding and nutrition programs with
existing or newly-established maternal, infant, and children
programs that provide health-needs interventions,
including maternal, prenatal, and postnatal and newborn
care;
(C) involve indigenous institutions as well as local
communities and governments in the development and
implementation of the programs and activities to foster
local capacity building and leadership; and

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(D) carry out multiyear programs that foster local selfsufficiency and ensure the longevity of programs in the
recipient country .
(g) USE OF FOOD AND NUTRITION SERVICE.—The Food and
Nutrition Service of the Department of Agriculture may provide
technical advice on the establishment of programs under subsection
(b)(1) and on implementation of the programs in the field in
recipient countries.
(h) MULTILATERAL INVOLVEMENT.—
(1) IN GENERAL.—The President is urged to engage existing
international food aid coordinating mechanisms to ensure multilateral commitments to, and participation in, programs similar
to programs supported under this section.
(2) REPORTS.—The President shall annually submit to the
Committee on International Relations and the Committee on
Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a report
on the commitments and activities of governments, including
the United States government, in the global effort to reduce
child hunger and increase school attendance.
(i) PRIVATE SECTOR INVOLVEMENT.—The President is urged to
encourage the support and active involvement of the private sector,
foundations, and other individuals and organizations in programs
assisted under this section.
(j) GRADUATION.—An agreement with an eligible organization
under this section shall include provisions—
(1) to—
(A) sustain the benefits to the education, enrollment,
and attendance of children in schools in the targeted
communities when the provision of commodities and assistance to a recipient country under a program under this
section terminates; and
(B) estimate the period of time required until the
recipient country or eligible organization is able to provide
sufficient assistance without additional assistance under
this section; or
(2) to provide other long-term benefits to targeted populations of the recipient country.
(k) REQUIREMENT TO SAFEGUARD LOCAL PRODUCTION AND
USUAL MARKETING.—The requirement of section 403(a) of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C.
1733(a)) applies with respect to the availability of commodities
under this section.
(l) FUNDING.—
(1) IN GENERAL.—Of the funds of the Commodity Credit
Corporation, the President shall use $100,000,000 for fiscal
year 2003 to carry out this section.
(2) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such sums as are necessary to carry
out this section for each of fiscal years 2004 through 2007.
(3) ADMINISTRATIVE EXPENSES.—Funds made available to
carry out this section may be used to pay the administrative
expenses of any Federal agency implementing or assisting in
the implementation of this section.

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Subtitle C—Miscellaneous
SEC. 3201. SURPLUS COMMODITIES FOR DEVELOPING OR FRIENDLY
COUNTRIES.

(a) USE OF CURRENCIES.—Section 416(b)(7)(D) of the Agricultural Act of 1949 (7 U.S.C. 1431(b)(7)(D)) is amended—
(1) in clauses (i) and (iii), by striking ‘‘foreign currency’’
each place it appears;
(2) in clause (ii)—
(A) by striking ‘‘Foreign currencies’’ and inserting ‘‘Proceeds’’; and
(B) by striking ‘‘foreign currency’’; and
(3) in clause (iv)—
(A) by striking ‘‘Foreign currency proceeds’’ and
inserting ‘‘Proceeds’’;
(B) by striking ‘‘country of origin’’ the second place
it appears and all that follows through ‘‘as necessary to
expedite’’ and inserting ‘‘country of origin as necessary
to expedite’’;
(C) by striking ‘‘; or’’ and inserting a period; and
(D) by striking subclause (II).
(b) IMPLEMENTATION OF AGREEMENTS.—Section 416(b) of the
Agricultural Act of 1949 (7 U.S.C. 1431(b)) (as amended by section
3009(b)) is amended—
(1) in paragraph (8), by striking ‘‘(8)(A)’’ and all that follows
through ‘‘(B) The Secretary’’ and inserting the following:
‘‘(8) ADMINISTRATIVE PROVISIONS.—
‘‘(A) EXPEDITED PROCEDURES.—To the maximum extent
practicable, expedited procedures shall be used in the
implementation of this subsection.
‘‘(B) ESTIMATE OF COMMODITIES.—The Secretary shall
publish in the Federal Register, not later than October
31 of each fiscal year, an estimate of the types and quantities of commodities and products that will be available
under this section for the fiscal year.
‘‘(C) FINALIZATION OF AGREEMENTS.—The Secretary is
encouraged to finalize program agreements under this section not later than December 31 of each fiscal year.
‘‘(D) REGULATIONS.—The Secretary’’; and
(2) by adding at the end the following:
‘‘(11) REQUIREMENTS.—
‘‘(A) IN GENERAL.—Not later than 270 days after the
date of enactment of this subparagraph, the Secretary shall
review and, as necessary, make changes in regulations
and internal procedures designed to streamline, improve,
and clarify the application, approval, and implementation
processes pertaining to agreements under this section.
‘‘(B) CONSIDERATIONS.—In conducting the review, the
Secretary shall consider—
‘‘(i) revising procedures for submitting proposals;
‘‘(ii) developing criteria for program approval that
separately address the objectives of the program;
‘‘(iii) pre-screening organizations and proposals to
ensure that the minimum qualifications are met;

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publication.
Deadline.

Deadline.

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‘‘(iv) implementing e-government initiatives and
otherwise improving the efficiency of the proposal
submission and approval processes;
‘‘(v) upgrading information management systems;
‘‘(vi) improving commodity and transportation
procurement processes; and
‘‘(vii) ensuring that evaluation and monitoring
methods are sufficient.
‘‘(C) CONSULTATIONS.—Not later than 1 year after the
date of enactment of this subparagraph, the Secretary shall
consult with the Committee on Agriculture, and the Committee on International Relations, of the House of Representatives and the Committee on Agriculture, Nutrition,
and Forestry of the Senate on changes made in regulations
and procedures under this paragraph.’’.

Deadline.

SEC. 3202. BILL EMERSON HUMANITARIAN TRUST.

Section 302 of the Bill Emerson Humanitarian Trust Act (7
U.S.C. 1736f–1) is amended by striking ‘‘2002’’ each place it appears
in subsection (b)(2)(B)(i) and paragraphs (1) and (2) of subsection
(h) and inserting ‘‘2007’’.
SEC. 3203. EMERGING MARKETS.

Section 1542 of the Food, Agriculture, Conservation, and Trade
Act of 1990 (7 U.S.C. 5622 note) is amended in subsections (a)
and (d)(1)(A)(i) by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 3204. BIOTECHNOLOGY AND AGRICULTURAL TRADE PROGRAM.

The Food, Agriculture, Conservation, and Trade Act of 1990
is amended by inserting after section 1543 (7 U.S.C. 3293) the
following:
7 USC 5679.

‘‘SEC. 1543A. BIOTECHNOLOGY AND AGRICULTURAL TRADE PROGRAM.

‘‘(a) ESTABLISHMENT.—There is established in the Department
the biotechnology and agricultural trade program.
‘‘(b) PURPOSE.—The purpose of the program shall be to remove,
resolve, or mitigate significant regulatory nontariff barriers to the
export of United States agricultural commodities (as defined in
section 102 of the Agricultural Trade Act of 1978 (7 U.S.C. 5602))
into foreign markets through public and private sector projects
funded by grants that address—
‘‘(1) quick response intervention regarding nontariff barriers to United States exports involving—
‘‘(A) United States agricultural commodities produced
through biotechnology;
‘‘(B) food safety;
‘‘(C) disease; or
‘‘(D) other sanitary or phytosanitary concerns; or
‘‘(2) developing protocols as part of bilateral negotiations
with other countries on issues such as animal health, grain
quality, and genetically modified commodities.
‘‘(c) ELIGIBLE PROGRAMS.—Depending on need, as determined
by the Secretary, activities authorized under this section may be
carried out through—
‘‘(1) this section;
‘‘(2) the emerging markets program under section 1542;
or
‘‘(3) the Cochran Fellowship Program under section 1543.

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‘‘(d) FUNDING.—There is authorized to be appropriated
$6,000,000 for each of fiscal years 2002 through 2007.’’.
SEC. 3205. TECHNICAL ASSISTANCE FOR SPECIALTY CROPS.

7 USC 5680.

(a) ESTABLISHMENT.—The Secretary of Agriculture shall establish an export assistance program (referred to in this section as
the ‘‘program’’) to address unique barriers that prohibit or threaten
the export of United States specialty crops.
(b) PURPOSE.—The program shall provide direct assistance
through public and private sector projects and technical assistance
to remove, resolve, or mitigate sanitary and phytosanitary and
related barriers to trade.
(c) PRIORITY.—The program shall address time sensitive and
strategic market access projects based on—
(1) trade effect on market retention, market access, and
market expansion; and
(2) trade impact.
(d) FUNDING.—For each of fiscal years 2002 through 2007,
the Secretary shall make available $2,000,000 of the funds of,
or an equal value of commodities owned by, the Commodity Credit
Corporation.
SEC. 3206. GLOBAL MARKET STRATEGY.

7 USC 5603a.

(a) IN GENERAL.—Not later than 180 days after the date of
enactment of this Act, and biennially thereafter, the Secretary
of Agriculture shall consult with the Committee on Agriculture,
and the Committee on International Relations, of the House of
Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate on the formulation and implementation
of a global market strategy for the Department of Agriculture
that, to the maximum extent practicable—
(1) identifies opportunities for the growth of agricultural
exports to overseas markets;
(2) ensures that the resources, programs, and policies of
the Department are coordinated with those of other agencies;
and
(3) remove barriers to agricultural trade in overseas markets.
(b) REVIEW.—The consultations under subsection (a) shall
include a review of—
(1) the strategic goals of the Department; and
(2) the progress of the Department in implementing the
strategic goals through the global market strategy.

Deadline.

SEC. 3207. REPORT ON USE OF PERISHABLE COMMODITIES AND LIVE
ANIMALS.

Not later than 120 days after the date of enactment of this
Act, the Secretary of Agriculture shall submit to the Committee
on Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a report
on international food aid programs of the United States that
evaluates—
(1) the implications of storage and transportation capacity
and funding for the use of perishable agricultural commodities
and semiperishable agricultural commodities; and
(2) the feasibility of the transport of lambs and other live
animals under the program.

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7 USC 5693 note.

SEC. 3208. STUDY ON FEE FOR SERVICES.

Deadline.

(a) IN GENERAL.—Not later than 1 year after the date of enactment of this Act, the Secretary of Agriculture shall submit to
the Committee on Agriculture, and the Committee on International
Relations, of the House of Representatives and the Committee on
Agriculture, Nutrition and Forestry of the Senate a report on the
feasibility of instituting a program under which the Secretary would
charge and retain a fee to cover the costs incurred by the Department of Agriculture, acting through the Foreign Agricultural Service
or any successor agency, in providing persons with commercial
services provided outside the United States.
(b) PURPOSE OF PROGRAM.—The purpose of a program described
in subsection (a) would be to supplement and not replace any
services currently offered overseas by the Foreign Agricultural
Service.
(c) MARKET DEVELOPMENT STRATEGY.—A program under subsection (b) would be part of an overall market development strategy
for a particular country or region.
(d) PILOT PROGRAM.—A program under subsection (a) would
be established on a pilot basis to ensure that the program does
not disadvantage small- and medium-sized companies, including
companies that have never engaged in exporting.
SEC. 3209. SENSE OF CONGRESS CONCERNING FOREIGN ASSISTANCE
PROGRAMS.

(a) FINDINGS.—Congress finds that—
(1) the international community faces a continuing epidemic of ethnic, sectarian, and criminal violence;
(2) poverty, hunger, political uncertainty, and social instability are the principal causes of violence and conflict around
the world;
(3) broad-based, equitable economic growth and agriculture
development facilitates political stability, food security, democracy, and the rule of law;
(4) democratic governments are more likely to advocate
and observe international laws, protect civil and human rights,
pursue free market economies, and avoid external conflicts;
(5) the United States Agency for International Development
has provided critical democracy and governance assistance to
a majority of the nations that successfully made the transition
to democratic governments during the past 2 decades;
(6) 43 of the top 50 consumer nations of American agricultural products were once United States foreign aid recipients;
(7) in the past 50 years, infant child death rates in the
developing world have been reduced by 50 percent, and health
conditions around the world have improved more during this
period than in any other period;
(8) the United States Agency for International Development
child survival programs have significantly contributed to a 10
percent reduction in infant mortality rates worldwide in just
the past 8 years;
(9) in providing assistance by the United States and other
donors in better seeds and teaching more efficient agricultural
techniques over the past 2 decades have helped make it possible
to feed an additional 1,000,000,000 people in the world;
(10) despite this progress, approximately 1,200,000,000
people, one-quarter of the world’s population, live on less that

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$1 per day, and approximately 3,000,000,000 people live on
only $2 per day;
(11) 95 percent of new births occur in developing countries,
including the world’s poorest countries; and
(12) only 1⁄2 percent of the Federal budget is dedicated
to international economic and humanitarian assistance.
(b) SENSE OF CONGRESS.—It is the sense of Congress that—
(1) United States foreign assistance programs should play
an increased role in the global fight against terrorism to complement the national security objectives of the United States;
(2) the United States should lead coordinated international
efforts to provide increased financial assistance to countries
with impoverished and disadvantaged populations that are the
breeding grounds for terrorism; and
(3) the United States Agency for International Development
and the Department of Agriculture should substantially
increase humanitarian, economic development, and agricultural
assistance to foster international peace and stability and the
promotion of human rights.
SEC. 3210. SENSE OF THE SENATE CONCERNING AGRICULTURAL
TRADE.

(a) AGRICULTURE TRADE NEGOTIATING OBJECTIVES.—It is the
sense of the Senate that the principal negotiating objective of the
United States with respect to agricultural trade in all multilateral,
regional, and bilateral negotiations is to obtain competitive
opportunities for the export of United States agricultural commodities in foreign markets substantially equivalent to the competitive
opportunities afforded foreign exports in United States markets
and to achieve fairer and more open conditions of agricultural
trade in bulk and value-added commodities by—
(1) reducing or eliminating, by a date certain, tariffs or
other charges that decrease market opportunities for the export
of United States agricultural commodities, giving priority to
United States agricultural commodities that are subject to
significantly higher tariffs or subsidy regimes of major producing countries;
(2) immediately eliminating all export subsidies on agricultural commodities worldwide while maintaining bona fide food
aid and preserving United States agricultural market development and export credit programs that allow the United States
to compete with other foreign export promotion efforts;
(3) leveling the playing field for United States agricultural
producers by disciplining domestic supports such that no other
country can provide greater support, measured as a percentage
of total agricultural production value, than the United States
does while preserving existing green box category to support
conservation activities, family farms, and rural communities;
(4) developing, strengthening, and clarifying rules and
effective dispute settlement mechanisms to eliminate practices
that unfairly decrease United States market access opportunities for United States agricultural commodities or distort agricultural markets to the detriment of the United States,
including—
(A) unfair or trade-distorting activities of state trading
enterprises and other administrative mechanisms, with
emphasis on—

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(i) requiring price transparency in the operation
of state trading enterprises and such other mechanisms; and
(ii) ending discriminatory pricing practices for agricultural commodities that amount to de facto export
subsidies so that the enterprises or other mechanisms
do not (except in cases of bona fide food aid) sell
agricultural commodities in foreign markets at prices
below domestic market prices or prices below the full
costs of acquiring and delivering agricultural commodities to the foreign markets;
(B) unjustified trade restrictions or commercial requirements affecting new agricultural technologies, including
biotechnology;
(C) unjustified sanitary or phytosanitary restrictions,
including restrictions that are not based on scientific principles, in contravention of the Agreement on the Application
of Sanitary and Phytosanitary Measures (as described in
section 101(d)(3) of the Uruguay Round Agreements Act
(19 U.S.C. 3511(d)(3)));
(D) other unjustified technical barriers to agricultural
trade; and
(E) restrictive and nontransparent rules in the
administration of tariff rate quotas;
(5) improving import relief mechanisms to recognize the
unique characteristics of perishable agricultural commodities;
(6) taking into account whether a party to negotiations
with respect to trading in an agricultural commodity has—
(A) failed to adhere to the provisions of an existing
bilateral trade agreement with the United States;
(B) circumvented obligations under a multilateral trade
agreement to which the United States is a signatory; or
(C) manipulated its currency value to the detriment
of United States agricultural producers or exporters; and
(7) otherwise ensuring that countries that accede to the
World Trade Organization—
(A) have made meaningful market liberalization
commitments in agriculture; and
(B) make progress in fulfilling those commitments over
time.
(b) PRIORITY FOR AGRICULTURE TRADE.—It is the sense of the
Senate that—
(1) reaching a successful agreement on agriculture should
be the top priority of United States negotiators in World Trade
Organization talks; and
(2) if the primary export competitors of the United States
fail to reduce their trade distorting domestic supports and
eliminate export subsidies in accordance with the negotiating
objectives expressed in this section, the United States should
take steps to increase the leverage of United States negotiators
and level the playing field for United States producers, within
existing World Trade Organization commitments.
(c) CONSULTATION WITH CONGRESSIONAL COMMITTEES.—It is
the sense of the Senate that—

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(1) before the United States Trade Representative negotiates a trade agreement that would reduce tariffs on agricultural commodities or require a change in United States agricultural law, the United States Trade Representative should consult with the Committee on Agriculture and the Committee
on Ways and Means of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry and the
Committee on Finance of the Senate;
(2) not less than 48 hours before initialing an agreement
relating to agricultural trade negotiated under the auspices
of the World Trade Organization, the United States Trade
Representative should consult closely with the committees
referred to in paragraph (1) regarding—
(A) the details of the agreement;
(B) the potential impact of the agreement on United
States agricultural producers; and
(C) any changes in United States law necessary to
implement the agreement; and
(3) any agreement or other understanding (whether verbal
or in writing) that relates to agricultural trade that is not
disclosed to Congress before legislation implementing a trade
agreement is introduced in either the Senate or the House
of Representatives should not be considered to be part of the
agreement approved by Congress and should have no force
and effect under Unites States law or in any dispute settlement
body.

TITLE IV—NUTRITION PROGRAMS
SEC. 4001. SHORT TITLE.

Food Stamp
Reauthorization
Act of 2002.
7 USC 2011 note.

This title may be cited as the ‘‘Food Stamp Reauthorization
Act of 2002’’.

Subtitle A—Food Stamp Program
SEC. 4101. ENCOURAGEMENT OF PAYMENT OF CHILD SUPPORT.

(a) EXCLUSION.—Section 5(d)(6) of the Food Stamp Act of 1977
(7 U.S.C. 2014(d)(6)) is amended by adding at the end the following:
‘‘and child support payments made by a household member to
or for an individual who is not a member of the household if
the household member is legally obligated to make the payments,’’.
(b) SIMPLIFIED PROCEDURE.—Section 5 of the Food Stamp Act
of 1977 (7 U.S.C. 2014) is amended—
(1) in subsection (e), by striking paragraph (4) and inserting
the following:
‘‘(4) DEDUCTION FOR CHILD SUPPORT PAYMENTS.—
‘‘(A) IN GENERAL.—In lieu of providing an exclusion
for legally obligated child support payments made by a
household member under subsection (d)(6), a State agency
may elect to provide a deduction for the amount of the
payments.
‘‘(B) ORDER OF DETERMINING DEDUCTIONS.—A deduction under this paragraph shall be determined before the
computation of the excess shelter expense deduction under
paragraph (6).’’; and

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(2) by adding at the end the following:
‘‘(n) STATE OPTIONS TO SIMPLIFY DETERMINATION OF CHILD
SUPPORT PAYMENTS.—Regardless of whether a State agency elects
to provide a deduction under subsection (e)(4), the Secretary shall
establish simplified procedures to allow State agencies, at the option
of the State agencies, to determine the amount of any legally
obligated child support payments made, including procedures to
allow the State agency to rely on information from the agency
responsible for implementing the program under part D of title
IV of the Social Security Act (42 U.S.C. 651 et seq.) concerning
payments made in prior months in lieu of obtaining current information from the households.’’.
SEC. 4102. SIMPLIFIED DEFINITION OF INCOME.

Section 5(d) of the Food Stamp Act of 1977 (7 U.S.C. 2014(d))
is amended—
(1) by striking ‘‘and (15)’’ and inserting ‘‘(15)’’; and
(2) by inserting before the period at the end the following:
‘‘, (16) at the option of the State agency, any educational loans
on which payment is deferred, grants, scholarships, fellowships,
veterans’ educational benefits, and the like (other than loans,
grants, scholarships, fellowships, veterans’ educational benefits,
and the like excluded under paragraph (3)), to the extent that
they are required to be excluded under title XIX of the Social
Security Act (42 U.S.C. 1396 et seq.), (17) at the option of
the State agency, any State complementary assistance program
payments that are excluded for the purpose of determining
eligibility for medical assistance under section 1931 of the
Social Security Act (42 U.S.C. 1396u–1), and (18) at the option
of the State agency, any types of income that the State agency
does not consider when determining eligibility for (A) cash
assistance under a program funded under part A of title IV
of the Social Security Act (42 U.S.C. 601 et seq.) or the amount
of such assistance, or (B) medical assistance under section
1931 of the Social Security Act (42 U.S.C. 1396u–1), except
that this paragraph does not authorize a State agency to
exclude wages or salaries, benefits under title I, II, IV, X,
XIV, or XVI of the Social Security Act (42 U.S.C. 301 et seq.),
regular payments from a government source (such as unemployment benefits and general assistance), worker’s compensation,
child support payments made to a household member by an
individual who is legally obligated to make the payments, or
such other types of income the consideration of which the
Secretary determines by regulation to be essential to equitable
determinations of eligibility and benefit levels’’.
SEC. 4103. STANDARD DEDUCTION.

Section 5(e) of the Food Stamp Act of 1977 (7 U.S.C. 2014(e))
is amended by striking paragraph (1) and inserting the following:
‘‘(1) STANDARD DEDUCTION.—
‘‘(A) IN GENERAL.—
‘‘(i) DEDUCTION.—The Secretary shall allow a
standard deduction for each household in the 48 contiguous States and the District of Columbia, Alaska,
Hawaii, and the Virgin Islands of the United States
in an amount that is—

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‘‘(I) equal to 8.31 percent of the income
standard of eligibility established under subsection
(c)(1); but
‘‘(II) not more than 8.31 percent of the income
standard of eligibility established under subsection
(c)(1) for a household of 6 members.
‘‘(ii) MINIMUM AMOUNT.—Notwithstanding clause
(i), the standard deduction for each household in the
48 contiguous States and the District of Columbia,
Alaska, Hawaii, and the Virgin Islands of the United
States shall be not less than $134, $229, $189, and
$118, respectively.
‘‘(B) GUAM.—
‘‘(i) IN GENERAL.—The Secretary shall allow a
standard deduction for each household in Guam in
an amount that is—
‘‘(I) equal to 8.31 percent of twice the income
standard of eligibility established under subsection
(c)(1) for the 48 contiguous States and the District
of Columbia; but
‘‘(II) not more than 8.31 percent of twice the
income standard of eligibility established under
subsection (c)(1) for the 48 contiguous States and
the District of Columbia for a household of 6 members.
‘‘(ii) MINIMUM AMOUNT.—Notwithstanding clause
(i), the standard deduction for each household in Guam
shall be not less than $269.’’.
SEC. 4104. SIMPLIFIED UTILITY ALLOWANCE.

Section 5(e)(7)(C)(iii) of the Food Stamp Act of 1977 (7 U.S.C.
2014(e)(7)(C)(iii)) is amended—
(1) in subclause (I)(bb), by inserting ‘‘(without regard to
subclause (III))’’ after ‘‘Secretary finds’’; and
(2) by adding at the end the following:
‘‘(III) INAPPLICABILITY OF CERTAIN RESTRICTIONS.—Clauses (ii)(II) and (ii)(III) shall not apply
in the case of a State agency that has made the
use of a standard utility allowance mandatory
under subclause (I).’’.
SEC. 4105. SIMPLIFIED DETERMINATION OF HOUSING COSTS.

(a) IN GENERAL.—Section 5(e)(7) of the Food Stamp Act of
1977 (7 U.S.C. 2014(e)(7)) is amended by adding at the end the
following:
‘‘(D) HOMELESS HOUSEHOLDS.—
‘‘(i) ALTERNATIVE DEDUCTION.—In lieu of the
deduction provided under subparagraph (A), a State
agency may elect to allow a household in which all
members are homeless individuals, but that is not
receiving free shelter throughout the month, to receive
a deduction of $143 per month.
‘‘(ii) INELIGIBILITY.—The State agency may make
a household with extremely low shelter costs ineligible
for the alternative deduction under clause (i).’’.
(b) CONFORMING AMENDMENTS.—Section 5 of the Food Stamp
Act of 1977 (7 U.S.C. 2014) is amended—
(1) in subsection (e)—

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(A) by striking paragraph (5); and
(B) by redesignating paragraphs (6) and (7) as paragraphs (5) and (6), respectively; and
(2) in subsection (k)(4)(B), by striking ‘‘subsection (e)(7)’’
and inserting ‘‘subsection (e)(6)’’.

SEC. 4106. SIMPLIFIED DETERMINATION OF DEDUCTIONS.

Section 5(f)(1) of the Food Stamp Act of 1977 (7 U.S.C.
2014(f)(1)) is amended by adding at the end the following:
‘‘(C) SIMPLIFIED DETERMINATION OF DEDUCTIONS.—
‘‘(i) IN GENERAL.—Except as provided in clause
(ii), for the purposes of subsection (e), a State agency
may elect to disregard until the next recertification
of eligibility under section 11(e)(4) 1 or more types
of changes in the circumstances of a household that
affect the amount of deductions the household may
claim under subsection (e).
‘‘(ii) CHANGES THAT MAY NOT BE DISREGARDED.—
Under clause (i), a State agency may not disregard—
‘‘(I) any reported change of residence; or
‘‘(II) under standards prescribed by the Secretary, any change in earned income.’’.
SEC. 4107. SIMPLIFIED DEFINITION OF RESOURCES.

Section 5(g) of the Food Stamp Act of 1977 (7 U.S.C. 2014(g))
is amended—
(1) in paragraph (1), by striking ‘‘a member who is 60
years of age or older’’ and inserting ‘‘an elderly or disabled
member’’; and
(2) by adding at the end the following:
‘‘(6) EXCLUSION OF TYPES OF FINANCIAL RESOURCES NOT
CONSIDERED UNDER CERTAIN OTHER FEDERAL PROGRAMS.—
‘‘(A) IN GENERAL.—Subject to subparagraph (B), a State
agency may, at the option of the State agency, exclude
from financial resources under this subsection any types
of financial resources that the State agency does not consider when determining eligibility for—
‘‘(i) cash assistance under a program funded under
part A of title IV of the Social Security Act (42 U.S.C.
601 et seq.); or
‘‘(ii) medical assistance under section 1931 of the
Social Security Act (42 U.S.C. 1396u–1).
‘‘(B) LIMITATIONS.—Except to the extent that any of
the types of resources specified in clauses (i) through (iv)
are excluded under another paragraph of this subsection,
subparagraph (A) does not authorize a State agency to
exclude—
‘‘(i) cash;
‘‘(ii) licensed vehicles;
‘‘(iii) amounts in any account in a financial institution that are readily available to the household; or
‘‘(iv) any other similar type of resource the inclusion in financial resources of which the Secretary determines by regulation to be essential to equitable determinations of eligibility under the food stamp program.’’.

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SEC. 4108. ALTERNATIVE ISSUANCE SYSTEMS IN DISASTERS.

(a) IN GENERAL.—Section 5(h)(3)(B) of the Food Stamp Act
of 1977 (7 U.S.C. 2014(h)(3)(B)) is amended—
(1) in the first sentence, by inserting ‘‘issuance methods
and’’ after ‘‘shall adjust’’; and
(2) in the second sentence, by inserting ‘‘, any conditions
that make reliance on electronic benefit transfer systems
described in section 7(i) impracticable,’’ after ‘‘personnel’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.
SEC. 4109. STATE OPTION TO REDUCE REPORTING REQUIREMENTS.

Section 6(c)(1) of the Food Stamp Act of 1977 (7 U.S.C.
2015(c)(1)) is amended—
(1) in subparagraph (B), by striking ‘‘on a monthly basis’’;
and
(2) by adding at the end the following:
‘‘(D) FREQUENCY OF REPORTING.—
‘‘(i) IN GENERAL.—Except as provided in subparagraphs (A) and (C), a State agency may require households that report on a periodic basis to submit
reports—
‘‘(I) not less often than once each 6 months;
but
‘‘(II) not more often than once each month.
‘‘(ii) REPORTING BY HOUSEHOLDS WITH EXCESS
INCOME.—A household required to report less often
than once each 3 months shall, notwithstanding
subparagraph (B), report in a manner prescribed by
the Secretary if the income of the household for any
month exceeds the income standard of eligibility established under section 5(c)(2).’’.
SEC. 4110. COST NEUTRALITY FOR ELECTRONIC BENEFIT TRANSFER
SYSTEMS.

Section 7(i)(2) of the Food Stamp Act of 1977 (7 U.S.C.
2016(i)(2)) is amended—
(1) by striking subparagraph (A); and
(2) by redesignating subparagraphs (B) through (I) as subparagraphs (A) through (H), respectively.
SEC. 4111. REPORT ON ELECTRONIC BENEFIT TRANSFER SYSTEMS.

(a) DEFINITION OF EBT SYSTEM.—In this section, the term
‘‘EBT system’’ means an electronic benefit transfer system used
in issuance of benefits under the food stamp program under the
Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.).
(b) REPORT.—Not later than October 1, 2003, the Secretary
of Agriculture shall submit to the Committee on Agriculture of
the House of Representatives and the Committee on Agriculture,
Nutrition, and Forestry of the Senate a report that—
(1) describes the status of use by each State agency of
EBT systems;
(2) specifies the number of vendors that have entered into
a contract for an EBT system with a State agency;
(3)(A) specifies the number of State agencies that have
entered into an EBT-system contract with multiple EBT-system
vendors; and

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(B) describes, for each State agency described in subparagraph (A), how responsibilities are divided among the various
vendors;
(4) with respect to any State in which an EBT system
is not operational throughout the State as of October 1, 2002—
(A) provides an explanation of the reasons why an
EBT system is not operational throughout the State;
(B) describes how the reasons are being addressed;
and
(C) specifies the expected date of operation of an EBT
system throughout the State;
(5) provides a description of—
(A) the issues faced by any State agency that has
awarded a second EBT-system contract in the 2-year period
preceding the date of the report; and
(B) the steps that the State agency has taken to
address those issues;
(6) provides a description of—
(A) the issues faced by any State agency that will
award a second EBT-system contract within the 2-year
period beginning on the date of the report; and
(B) strategies that the State agency is considering to
address those issues;
(7) describes initiatives being considered or taken by the
Department of Agriculture, food retailers, EBT-system vendors,
and client advocates to address any outstanding issues with
respect to EBT systems; and
(8) examines areas of potential advances in electronic benefit delivery in the 5- to 10-year period beginning on the date
of the report, including—
(A) access to EBT systems at farmers’ markets;
(B) increased use of transaction data from EBT systems
to identify and prosecute fraud; and
(C) fostering of increased competition among EBTsystem vendors to ensure cost containment and optimal
service.

SEC. 4112. ALTERNATIVE PROCEDURES FOR RESIDENTS OF CERTAIN
GROUP FACILITIES.

(a) IN GENERAL.—Section 8 of the Food Stamp Act of 1977
(7 U.S.C. 2017) is amended by adding at the end the following:
‘‘(f) ALTERNATIVE PROCEDURES FOR RESIDENTS OF CERTAIN
GROUP FACILITIES.—
‘‘(1) IN GENERAL.—
‘‘(A) APPLICABILITY.—
‘‘(i) IN GENERAL.—Subject to clause (ii), at the
option of the State agency, allotments for residents
of any facility described in subparagraph (B), (C), (D),
or (E) of section 3(i)(5) (referred to in this subsection
as a ‘covered facility’) may be determined and issued
under this paragraph in lieu of subsection (a).
‘‘(ii) LIMITATION.—Unless the Secretary authorizes
implementation of this paragraph in all States under
paragraph (3), clause (i) shall apply only to residents
of covered facilities participating in a pilot project
under paragraph (2).

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‘‘(B) AMOUNT OF ALLOTMENT.—The allotment for each
eligible resident described in subparagraph (A) shall be
calculated in accordance with standardized procedures
established by the Secretary that take into account the
allotments typically received by residents of covered facilities.
‘‘(C) ISSUANCE OF ALLOTMENT.—
‘‘(i) IN GENERAL.—The State agency shall issue
an allotment determined under this paragraph to a
covered facility as the authorized representative of the
residents of the covered facility.
‘‘(ii) ADJUSTMENT.—The Secretary shall establish
procedures to ensure that a covered facility does not
receive a greater proportion of a resident’s monthly
allotment than the proportion of the month during
which the resident lived in the covered facility.
‘‘(D) DEPARTURES OF RESIDENTS OF COVERED FACILITIES.—
‘‘(i) NOTIFICATION.—Any covered facility that
receives an allotment for a resident under this paragraph shall—
‘‘(I) notify the State agency promptly on the
departure of the resident; and
‘‘(II) notify the resident, before the departure
of the resident, that the resident—
‘‘(aa) is eligible for continued benefits
under the food stamp program; and
‘‘(bb) should contact the State agency concerning continuation of the benefits.
‘‘(ii) ISSUANCE TO DEPARTED RESIDENTS.—On
receiving a notification under clause (i)(I) concerning
the departure of a resident, the State agency—
‘‘(I) shall promptly issue the departed resident
an allotment for the days of the month after the
departure of the resident (calculated in a manner
prescribed by the Secretary) unless the departed
resident reapplies to participate in the food stamp
program; and
‘‘(II) may issue an allotment for the month
following the month of the departure (but not any
subsequent month) based on this paragraph unless
the departed resident reapplies to participate in
the food stamp program.
‘‘(iii) STATE OPTION.—The State agency may elect
not to issue an allotment under clause (ii)(I) if the
State agency lacks sufficient information on the location of the departed resident to provide the allotment.
‘‘(iv) EFFECT OF REAPPLICATION.—If the departed
resident reapplies to participate in the food stamp
program, the allotment of the departed resident shall
be determined without regard to this paragraph.
‘‘(2) PILOT PROJECTS.—
‘‘(A) IN GENERAL.—Before the Secretary authorizes
implementation of paragraph (1) in all States, the Secretary
shall carry out, at the request of 1 or more State agencies
and in 1 or more areas of the United States, such number
of pilot projects as the Secretary determines to be sufficient

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to test the feasibility of determining and issuing allotments
to residents of covered facilities under paragraph (1) in
lieu of subsection (a).
‘‘(B) PROJECT PLAN.—To be eligible to participate in
a pilot project under subparagraph (A), a State agency
shall submit to the Secretary for approval a project plan
that includes—
‘‘(i) a specification of the covered facilities in the
State that will participate in the pilot project;
‘‘(ii) a schedule for reports to be submitted to the
Secretary on the pilot project;
‘‘(iii) procedures for standardizing allotment
amounts that takes into account the allotments typically received by residents of covered facilities; and
‘‘(iv) a commitment to carry out the pilot project
in compliance with the requirements of this subsection
other than paragraph (1)(B).
‘‘(3) AUTHORIZATION OF IMPLEMENTATION IN ALL STATES.—
‘‘(A) IN GENERAL.—The Secretary shall—
‘‘(i) determine whether to authorize implementation of paragraph (1) in all States; and
‘‘(ii) notify the Committee on Agriculture of the
House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate of the
determination.
‘‘(B) DETERMINATION NOT TO AUTHORIZE IMPLEMENTATION IN ALL STATES.—
‘‘(i) IN GENERAL.—If the Secretary makes a finding
described in clause (ii), the Secretary—
‘‘(I) shall not authorize implementation of
paragraph (1) in all States; and
‘‘(II) shall terminate all pilot projects under
paragraph (2) within a reasonable period of time
(as determined by the Secretary).
‘‘(ii) FINDING.—The finding referred to in clause
(i) is that—
‘‘(I) an insufficient number of project plans
that the Secretary determines to be eligible for
approval are submitted by State agencies under
paragraph (2)(B); or
‘‘(II)(aa) a sufficient number of pilot projects
have been carried out under paragraph (2)(A); and
‘‘(bb) authorization of implementation of paragraph (1) in all States is not in the best interest
of the food stamp program.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 3(i) of the Food Stamp Act of 1977 (7 U.S.C.
2012(i)) is amended—
(A) by striking ‘‘(i) ‘Household’ means (1) an’’ and
inserting the following:
‘‘(i)(1) ‘Household’ means—
‘‘(A) an’’;
(B) in the first sentence, by striking ‘‘others, or (2)
a group’’ and inserting the following: ‘‘others; or
‘‘(B) a group’’;
(C) in the second sentence, by striking ‘‘Spouses’’ and
inserting the following:

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‘‘(2) Spouses’’;
(D) in the third sentence, by striking ‘‘Notwithstanding’’ and inserting the following:
‘‘(3) Notwithstanding’’;
(E) in paragraph (3) (as designated by subparagraph
(D)), by striking ‘‘the preceding sentences’’ and inserting
‘‘paragraphs (1) and (2)’’;
(F) in the fourth sentence, by striking ‘‘In no event’’
and inserting the following:
‘‘(4) In no event’’;
(G) in the fifth sentence, by striking ‘‘For the purposes
of this subsection, residents’’ and inserting the following:
‘‘(5) For the purposes of this subsection, the following persons
shall not be considered to be residents of institutions and shall
be considered to be individual households:
‘‘(A) Residents’’; and
(H) in paragraph (5) (as designated by subparagraph
(G))—
(i) by striking ‘‘Act, or are individuals’’ and
inserting the following: ‘‘Act.
‘‘(B) Individuals’’;
(ii) by striking ‘‘such section, temporary’’ and
inserting the following: ‘‘that section.
‘‘(C) Temporary’’;
(iii) by striking ‘‘children, residents’’ and inserting
the following: ‘‘children.
‘‘(D) Residents’’;
(iv) by striking ‘‘coupons, and narcotics’’ and
inserting the following: ‘‘coupons.
‘‘(E) Narcotics’’; and
(v) by striking ‘‘shall not’’ and all that follows
and inserting a period.
(2) Section 5(a) of the Food Stamp Act of 1977 (7 U.S.C.
2014(a)) is amended by striking ‘‘the third sentence of section
3(i)’’ each place it appears and inserting ‘‘section 3(i)(4)’’.
(3) Section 8(e)(1) of the Food Stamp Act of 1977 (7 U.S.C.
2017(e)(1)) is amended by striking ‘‘the last sentence of section
3(i)’’ and inserting ‘‘section 3(i)(5)’’.
(4) Section 17(b)(1)(B)(iv)(III)(aa) of the Food Stamp Act
of 1977 (7 U.S.C. 2026(b)(1)(B)(iv)(III)(aa)) is amended by
striking ‘‘the last 2 sentences of section 3(i)’’ and inserting
‘‘paragraphs (4) and (5) of section 3(i)’’.
SEC. 4113. REDEMPTION OF BENEFITS THROUGH GROUP LIVING
ARRANGEMENTS.

(a) IN GENERAL.—Section 10 of the Food Stamp Act of 1977
(7 U.S.C. 2019) is amended by inserting after the first sentence
the following: ‘‘Notwithstanding the preceding sentence, a center,
organization, institution, shelter, group living arrangement, or
establishment described in that sentence may be authorized to
redeem coupons through a financial institution described in that
sentence if the center, organization, institution, shelter, group living
arrangement, or establishment is equipped with 1 or more pointof-sale devices and is operating in an area in which an electronic
benefit transfer system described in section 7(i) has been implemented.’’.

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(b) EFFECTIVE DATE.—The amendment made by this section
takes effect on the date of enactment of this Act.
SEC. 4114. AVAILABILITY OF FOOD STAMP PROGRAM APPLICATIONS
ON THE INTERNET.

7 USC 2020 note.

(a) IN GENERAL.—Section 11(e)(2)(B)(ii) of the Food Stamp Act
of 1977 (7 U.S.C. 2020(e)(2)(B)(ii)) is amended—
(1) by inserting ‘‘(I)’’ after ‘‘(ii)’’;
(2) in subclause (I) (as designated by paragraph (1)), by
adding ‘‘and’’ at the end; and
(3) by adding at the end the following:
‘‘(II) if the State agency maintains a website for the
State agency, shall make the application available on the
website in each language in which the State agency makes
a printed application available;’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect 18 months after the date of enactment of this Act.
SEC. 4115. TRANSITIONAL FOOD STAMPS FOR FAMILIES MOVING FROM
WELFARE.

(a) IN GENERAL.—Section 11 of the Food Stamp Act of 1977
(7 U.S.C. 2020) is amended by adding at the end the following:
‘‘(s) TRANSITIONAL BENEFITS OPTION.—
‘‘(1) IN GENERAL.—A State agency may provide transitional
food stamp benefits to a household that ceases to receive cash
assistance under a State program funded under part A of
title IV of the Social Security Act (42 U.S.C. 601 et seq.).
‘‘(2) TRANSITIONAL BENEFITS PERIOD.—Under paragraph (1),
a household may receive transitional food stamp benefits for
a period of not more than 5 months after the date on which
cash assistance is terminated.
‘‘(3) AMOUNT OF BENEFITS.—During the transitional benefits period under paragraph (2), a household shall receive an
amount of food stamp benefits equal to the allotment received
in the month immediately preceding the date on which cash
assistance was terminated, adjusted for the change in household
income as a result of—
‘‘(A) the termination of cash assistance; and
‘‘(B) at the option of the State agency, information
from another program in which the household participates.
‘‘(4) DETERMINATION OF FUTURE ELIGIBILITY.—In the final
month of the transitional benefits period under paragraph (2),
the State agency may—
‘‘(A) require the household to cooperate in a recertification of eligibility; and
‘‘(B) initiate a new certification period for the household
without regard to whether the preceding certification period
has expired.
‘‘(5) LIMITATION.—A household shall not be eligible for
transitional benefits under this subsection if the household—
‘‘(A) loses eligibility under section 6;
‘‘(B) is sanctioned for a failure to perform an action
required by Federal, State, or local law relating to a cash
assistance program described in paragraph (1); or
‘‘(C) is a member of any other category of households
designated by the State agency as ineligible for transitional
benefits.
‘‘(6) APPLICATIONS FOR RECERTIFICATION.—

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‘‘(A) IN GENERAL.—A household receiving transitional
benefits under this subsection may apply for recertification
at any time during the transitional benefits period under
paragraph (2).
‘‘(B) DETERMINATION OF ALLOTMENT.—If a household
applies for recertification under subparagraph (A), the allotment of the household for all subsequent months shall
be determined without regard to this subsection.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 3(c) of the Food Stamp Act of 1977 (7 U.S.C.
2012(c)) is amended by adding at the end the following: ‘‘The
limits specified in this subsection may be extended until the
end of any transitional benefit period established under section
11(s).’’.
(2) Section 6(c) of the Food Stamp Act of 1977 (7 U.S.C.
2015(c)) is amended by striking ‘‘No household’’ and inserting
‘‘Except in a case in which a household is receiving transitional
benefits during the transitional benefits period under section
11(s), no household’’.
SEC. 4116. GRANTS FOR SIMPLE APPLICATION AND ELIGIBILITY
DETERMINATION SYSTEMS AND IMPROVED ACCESS TO
BENEFITS.

(a) IN GENERAL.—Section 11 of the Food Stamp Act of 1977
(7 U.S.C. 2020) (as amended by section 4115(a)) is amended by
adding at the end the following:
‘‘(t) GRANTS FOR SIMPLE APPLICATION AND ELIGIBILITY DETERMINATION SYSTEMS AND IMPROVED ACCESS TO BENEFITS.—
‘‘(1) IN GENERAL.—For each of fiscal years 2003 through
2007, the Secretary shall use not more than $5,000,000 of
funds made available under section 18(a)(1) to make grants
to pay 100 percent of the costs of eligible entities approved
by the Secretary to carry out projects to develop and
implement—
‘‘(A) simple food stamp application and eligibility determination systems; or
‘‘(B) measures to improve access to food stamp benefits
by eligible households.
‘‘(2) TYPES OF PROJECTS.—A project under paragraph (1)
may consist of—
‘‘(A) coordinating application and eligibility determination processes, including verification practices, under the
food stamp program and other Federal, State, and local
assistance programs;
‘‘(B) establishing methods for applying for benefits and
determining eligibility that—
‘‘(i) more extensively use—
‘‘(I) communications by telephone; and
‘‘(II) electronic alternatives such as the Internet; or
‘‘(ii) otherwise improve the administrative infrastructure used in processing applications and determining eligibility;
‘‘(C) developing procedures, training materials, and
other resources aimed at reducing barriers to participation
and reaching eligible households;

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‘‘(D) improving methods for informing and enrolling
eligible households; or
‘‘(E) carrying out such other activities as the Secretary
determines to be appropriate.
‘‘(3) LIMITATION.—A grant under this subsection shall not
be made for the ongoing cost of carrying out any project.
‘‘(4) ELIGIBLE ENTITIES.—To be eligible to receive a grant
under this subsection, an entity shall be—
‘‘(A) a State agency administering the food stamp program;
‘‘(B) a State or local government;
‘‘(C) an agency providing health or welfare services;
‘‘(D) a public health or educational entity; or
‘‘(E) a private nonprofit entity such as a communitybased organization, food bank, or other emergency feeding
organization.
‘‘(5) SELECTION OF ELIGIBLE ENTITIES.—The Secretary—
‘‘(A) shall develop criteria for the selection of eligible
entities to receive grants under this subsection; and
‘‘(B) may give preference to any eligible entity that
consists of a partnership between a governmental entity
and a nongovernmental entity.’’.
(b) CONFORMING AMENDMENTS.—Section 17 of the Food Stamp
Act of 1977 (7 U.S.C. 2026) is amended—
(1) by striking subsection (i); and
(2) by redesignating subsections (j) and (k) as subsections
(i) and (j), respectively.
SEC. 4117. DELIVERY TO RETAILERS OF NOTICES OF ADVERSE ACTION.

7 USC 2023 note.

(a) IN GENERAL.—Section 14(a) of the Food Stamp Act of 1977
(7 U.S.C. 2023(a)) is amended by striking paragraph (2) and
inserting the following:
‘‘(2) DELIVERY OF NOTICES.—A notice under paragraph (1)
shall be delivered by any form of delivery that the Secretary
determines will provide evidence of the delivery.’’.
(b) EFFECTIVE DATE.—The amendment made by this section
takes effect on the date of enactment of this Act.
SEC. 4118. REFORM OF QUALITY CONTROL SYSTEM.

(a) IN GENERAL.—Section 16(c) of the Food Stamp Act of 1977
(7 U.S.C. 2025(c)) is amended—
(1) by striking ‘‘(c)(1) The program’’ and all that follows
through the end of paragraph (1) and inserting the following:
‘‘(c) QUALITY CONTROL SYSTEM.—
‘‘(1) IN GENERAL.—
‘‘(A) SYSTEM.—In carrying out the food stamp program,
the Secretary shall carry out a system that enhances payment accuracy and improves administration by establishing
fiscal incentives that require State agencies with high payment error rates to share in the cost of payment error.
‘‘(B) ADJUSTMENT OF FEDERAL SHARE OF ADMINISTRATIVE COSTS FOR FISCAL YEARS BEFORE FISCAL YEAR 2003.—
‘‘(i) IN GENERAL.—Subject to clause (ii), with
respect to any fiscal year before fiscal year 2003, the
Secretary shall adjust a State agency’s federally funded
share of administrative costs under subsection (a),
other than the costs already shared in excess of 50

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percent under the proviso in the first sentence of subsection (a) or under subsection (g), by increasing that
share of all such administrative costs by 1 percentage
point to a maximum of 60 percent of all such administrative costs for each full 1⁄10 of a percentage point
by which the payment error rate is less than 6 percent.
‘‘(ii) LIMITATION.—Only States with a rate of
invalid decisions in denying eligibility that is less than
a nationwide percentage that the Secretary determines
to be reasonable shall be entitled to the adjustment
under clause (i).
‘‘(C) ESTABLISHMENT OF LIABILITY AMOUNT FOR FISCAL
YEAR 2003 AND THEREAFTER.—With respect to fiscal year
2004 and any fiscal year thereafter for which the Secretary
determines that, for the second or subsequent consecutive
fiscal year, a 95 percent statistical probability exists that
the payment error rate of a State agency exceeds 105
percent of the national performance measure for payment
error rates announced under paragraph (6), the Secretary
shall establish an amount for which the State agency may
be liable (referred to in this paragraph as the ‘liability
amount’) that is equal to the product obtained by
multiplying—
‘‘(i) the value of all allotments issued by the State
agency in the fiscal year;
‘‘(ii) the difference between—
‘‘(I) the payment error rate of the State agency;
and
‘‘(II) 6 percent; and
‘‘(iii) 10 percent.
‘‘(D) AUTHORITY OF SECRETARY WITH RESPECT TO
LIABILITY AMOUNT.—With respect to the liability amount
established for a State agency under subparagraph (C)
for any fiscal year, the Secretary shall—
‘‘(i)(I) waive the responsibility of the State agency
to pay all or any portion of the liability amount established for the fiscal year (referred to in this paragraph
as the ‘waiver amount’);
‘‘(II) require that a portion, not to exceed 50 percent, of the liability amount established for the fiscal
year be used by the State agency for new investment,
approved by the Secretary, to improve administration
by the State agency of the food stamp program
(referred to in this paragraph as the ‘new investment
amount’), which new investment amount shall not be
matched by Federal funds;
‘‘(III) designate a portion, not to exceed 50 percent,
of the amount established for the fiscal year for payment to the Secretary in accordance with subparagraph
(E) (referred to in this paragraph as the ‘at-risk
amount’); or
‘‘(IV) take any combination of the actions described
in subclauses (I) through (III); or
‘‘(ii) make the determinations described in clause
(i) and enter into a settlement with the State agency,
only with respect to any waiver amount or new investment amount, before the end of the fiscal year in

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which the liability amount is determined under
subparagraph (C).
‘‘(E) PAYMENT OF AT-RISK AMOUNT FOR CERTAIN
STATES.—
‘‘(i) IN GENERAL.—A State agency shall pay to the
Secretary the at-risk amount designated under
subparagraph (D)(i)(III) for any fiscal year in accordance with clause (ii), if, with respect to the immediately
following fiscal year, a liability amount has been established for the State agency under subparagraph (C).
‘‘(ii) METHOD OF PAYMENT OF AT-RISK AMOUNT.—
‘‘(I) REMISSION TO THE SECRETARY.—In the
case of a State agency required to pay an atrisk amount under clause (i), as soon as practicable
after completion of all administrative and judicial
reviews with respect to that requirement to pay,
the chief executive officer of the State shall remit
to the Secretary the at-risk amount required to
be paid.
‘‘(II) ALTERNATIVE METHOD OF COLLECTION.—
‘‘(aa) IN GENERAL.—If the chief executive
officer of the State fails to make the payment
under subclause (I) within a reasonable period
of time determined by the Secretary, the Secretary may reduce any amount due to the
State agency under any other provision of this
section by the amount required to be paid
under clause (i).
‘‘(bb) ACCRUAL OF INTEREST.—During any
period of time determined by the Secretary
under item (aa), interest on the payment
under subclause (I) shall not accrue under section 13(a)(2).
‘‘(F) USE OF PORTION OF LIABILITY AMOUNT FOR NEW
INVESTMENT.—
‘‘(i) REDUCTION OF OTHER AMOUNTS DUE TO STATE
AGENCY.—In the case of a State agency that fails to
comply with a requirement for new investment under
subparagraph (D)(i)(II) or clause (iii)(I), the Secretary
may reduce any amount due to the State agency under
any other provision of this section by the portion of
the liability amount that has not been used in accordance with that requirement.
‘‘(ii) EFFECT OF STATE AGENCY’S WHOLLY PREVAILING ON APPEAL.—If a State agency begins required
new investment under subparagraph (D)(i)(II), the
State agency appeals the liability amount of the State
agency, and the determination by the Secretary of the
liability amount is reduced to $0 on administrative
or judicial review, the Secretary shall pay to the State
agency an amount equal to 50 percent of the new
investment amount that was included in the liability
amount subject to the appeal.
‘‘(iii) EFFECT OF SECRETARY’S WHOLLY PREVAILING
ON APPEAL.—If a State agency does not begin required
new investment under subparagraph (D)(i)(II), the
State agency appeals the liability amount of the State

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agency, and the determination by the Secretary of the
liability amount is wholly upheld on administrative
or judicial review, the Secretary shall—
‘‘(I) require all or any portion of the new
investment amount to be used by the State agency
for new investment, approved by the Secretary,
to improve administration by the State agency of
the food stamp program, which amount shall not
be matched by Federal funds; and
‘‘(II) require payment of any remaining portion
of the new investment amount in accordance with
subparagraph (E)(ii).
‘‘(iv) EFFECT OF NEITHER PARTY’S WHOLLY PREVAILING ON APPEAL.—The Secretary shall promulgate
regulations regarding obligations of the Secretary and
the State agency in a case in which the State agency
appeals the liability amount of the State agency and
neither the Secretary nor the State agency wholly prevails.
‘‘(G) CORRECTIVE ACTION PLANS.—The Secretary shall
foster management improvements by the States by
requiring State agencies, other than State agencies with
payment error rates of less than 6 percent, to develop
and implement corrective action plans to reduce payment
errors.’’;
(2) in paragraph (4), by striking ‘‘(4)’’ and all that follows
through the end of the first sentence and inserting the following:
‘‘(4) REPORTING REQUIREMENTS.—The Secretary may
require a State agency to report any factors that the Secretary
considers necessary to determine a State agency’s payment
error rate, liability amount or new investment amount under
paragraph (1), or performance under the performance measures
under subsection (d).’’;
(3) in paragraph (5)—
(A) by striking ‘‘(5)’’ and all that follows through the
end of the second sentence and inserting the following:
‘‘(5) PROCEDURES.—To facilitate the implementation of this
subsection, each State agency shall expeditiously submit to
the Secretary data concerning the operations of the State
agency in each fiscal year sufficient for the Secretary to establish the State agency’s payment error rate, liability amount
or new investment amount under paragraph (1), or performance
under the performance measures under subsection (d).’’; and
(B) in the last sentence, by striking ‘‘paragraph (1)(C)’’
and inserting ‘‘paragraph (1)’’;
(4) in paragraph (6)—
(A) by striking ‘‘(6) At’’ and inserting the following:
‘‘(6) NATIONAL PERFORMANCE MEASURE FOR PAYMENT ERROR
RATES.—
‘‘(A) ANNOUNCEMENT.—At’’;
(B) in subparagraph (A) (as designated by subparagraph (A)), by striking ‘‘and incentive payments or claims
pursuant to paragraphs (1)(A) and (1)(C)’’;
(C) in the first and third sentences, by striking ‘‘paragraph (5)’’ each place it appears and inserting ‘‘paragraph
(8)’’;

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PUBLIC LAW 107–171—MAY 13, 2002
(D) by striking ‘‘Where a State’’ and inserting the following:
‘‘(B) USE OF ALTERNATIVE MEASURE OF STATE ERROR.—
Where a State’’;
(E) by striking ‘‘The announced’’ and inserting the
following:
‘‘(C) USE OF NATIONAL PERFORMANCE MEASURE.—The
announced’’;
(F) in subparagraph (C) (as designated by subparagraph (E)), by striking ‘‘the State share of the cost of
payment error under paragraph (1)(C)’’ and inserting ‘‘the
liability amount of a State under paragraph (1)(C)’’; and
(G) by adding at the end the following:
‘‘(D) NO ADMINISTRATIVE OR JUDICIAL REVIEW.—The
national performance measure announced under this paragraph shall not be subject to administrative or judicial
review.’’;
(5) in paragraph (7)—
(A) by striking ‘‘(7) If the Secretary asserts a financial
claim against’’ and inserting the following:
‘‘(7) ADMINISTRATIVE AND JUDICIAL REVIEW.—
‘‘(A) IN GENERAL.—Except as provided in subparagraphs (B) and (C), if the Secretary asserts a financial
claim against or establishes a liability amount with respect
to’’;
(B) in subparagraph (A) (as designated by subparagraph (A)), by striking ‘‘paragraph (1)(C)’’ and inserting
‘‘paragraph (1)’’; and
(C) by adding at the end the following:
‘‘(B) DETERMINATION OF PAYMENT ERROR RATE.—With
respect to any fiscal year, a determination of the payment
error rate of a State agency or a determination whether
the payment error rate exceeds 105 percent of the national
performance measure for payment error rates shall be subject to administrative or judicial review only if the Secretary establishes a liability amount with respect to the
fiscal year under paragraph (1)(C).
‘‘(C) AUTHORITY OF SECRETARY WITH RESPECT TO
LIABILITY AMOUNT.—An action by the Secretary under
subparagraph (D) or (F)(iii) of paragraph (1) shall not be
subject to administrative or judicial review.’’; and
(6) in paragraph (8)—
(A) in subparagraph (A), by striking ‘‘paragraph (1)(C)’’
and inserting ‘‘paragraph (1)’’;
(B) in subparagraph (C)—
(i) in clause (i), by striking ‘‘payment claimed
against State agencies; and’’ and inserting ‘‘payment
claimed against State agencies or liability amount
established with respect to State agencies;’’;
(ii) in clause (ii), by striking ‘‘claims.’’ and inserting
‘‘claims or liability amounts; and’’; and
(iii) by adding at the end the following:
‘‘(iii) provide a copy of the document providing notification
under clause (ii) to the chief executive officer and the legislature
of the State.’’; and
(C) in subparagraphs (D) and (H), by inserting ‘‘or
liability amount’’ after ‘‘claim’’ each place it appears.

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(b) AUTHORITY TO SETTLE CLAIMS CONCERNING AT-RISK
AMOUNTS.—Section 13(a) of the Food Stamp Act of 1977 (7 U.S.C.
2022(a)) is amended—
(1) by striking ‘‘(a)(1) The’’ and inserting the following:
‘‘(a) GENERAL AUTHORITY OF THE SECRETARY.—
‘‘(1) DETERMINATION OF CLAIMS.—Except in the case of
an at-risk amount required under section 16(c)(1)(D)(i)(III),
the’’;
(2) by striking the fourth sentence;
(3) by striking ‘‘To the extent’’ and inserting the following:
‘‘(2) CLAIMS ESTABLISHED UNDER QUALITY CONTROL
SYSTEM.—To the extent’’;
(4) in paragraph (2) (as designated by paragraph (3)), by
striking ‘‘section 16(c)(1)(C)’’ and inserting ‘‘section 16(c)(1)’’;
(5) by striking ‘‘Any interest’’ and inserting the following:
‘‘(3) COMPUTATION OF INTEREST.—Any interest’’; and
(6) by striking ‘‘(2) Each adult’’ and inserting the following:
‘‘(4) JOINT AND SEVERAL LIABILITY OF HOUSEHOLD MEMBERS.—Each adult’’.
(c) CREDITING OF PAYMENTS TO FOOD STAMP APPROPRIATIONS
ACCOUNT.—Section 18(e) of the Food Stamp Act of 1977 (7 U.S.C.
2027(e)) is amended in the first sentence—
(1) by striking ‘‘11(g) and (h), and’’ and inserting ‘‘subsections (g) and (h) of section 11,’’; and
(2) by inserting ‘‘and section 16(c)(1),’’ after ‘‘section 13,’’.
(d) CONFORMING AMENDMENTS.—Section 22(h) of the Food
Stamp Act of 1977 (7 U.S.C. 2031(h)) is amended—
(1) in the second sentence, by striking ‘‘section 16(c)(1)(C)’’
and inserting ‘‘section 16(c)(1)’’; and
(2) by striking the third sentence.
(e) APPLICABILITY.—The amendments made by this section shall
not apply with respect to any sanction, appeal, new investment
agreement, or other action by the Secretary of Agriculture or a
State agency that is based on a payment error rate calculated
for any fiscal year before fiscal year 2003.

7 USC 2022 note.

SEC. 4119. IMPROVEMENT OF CALCULATION OF STATE PERFORMANCE
MEASURES.

(a) IN GENERAL.—Section 16(c)(8) of the Food Stamp Act of
1977 (7 U.S.C. 2025(c)(8)) is amended—
(1) in subparagraph (B), by striking ‘‘180 days after the
end of the fiscal year’’ and inserting ‘‘the first May 31 after
the end of the fiscal year referred to in subparagraph (A)’’;
and
(2) in subparagraph (C), by striking ‘‘30 days thereafter’’
and inserting ‘‘the first June 30 after the end of the fiscal
year referred to in subparagraph (A)’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.

7 USC 2025 note.

SEC. 4120. BONUSES FOR STATES THAT DEMONSTRATE HIGH OR MOST
IMPROVED PERFORMANCE.

(a) IN GENERAL.—Section 16 of the Food Stamp Act of 1977
(7 U.S.C. 2025) is amended by striking subsection (d) and inserting
the following:
‘‘(d) BONUSES FOR STATES THAT DEMONSTRATE HIGH OR MOST
IMPROVED PERFORMANCE.—
‘‘(1) FISCAL YEARS 2003 AND 2004.—

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‘‘(A) GUIDANCE.—With respect to fiscal years 2003 and
2004, the Secretary shall establish, in guidance issued to
State agencies not later than October 1, 2002—
‘‘(i) performance criteria relating to—
‘‘(I) actions taken to correct errors, reduce
rates of error, and improve eligibility determinations; and
‘‘(II) other indicators of effective administration determined by the Secretary; and
‘‘(ii) standards for high and most improved
performance to be used in awarding performance bonus
payments under subparagraph (B)(ii).
‘‘(B) PERFORMANCE BONUS PAYMENTS.—With respect to
each of fiscal years 2003 and 2004, the Secretary shall—
‘‘(i) measure the performance of each State agency
with respect to the criteria established under subparagraph (A)(i); and
‘‘(ii) subject to paragraph (3), award performance
bonus payments in the following fiscal year, in a total
amount of $48,000,000 for each fiscal year, to State
agencies that meet standards for high or most
improved performance established by the Secretary
under subparagraph (A)(ii).
‘‘(2) FISCAL YEARS 2005 AND THEREAFTER.—
‘‘(A) REGULATIONS.—With respect to fiscal year 2005
and each fiscal year thereafter, the Secretary shall—
‘‘(i) establish, by regulation, performance criteria
relating to—
‘‘(I) actions taken to correct errors, reduce
rates of error, and improve eligibility determinations; and
‘‘(II) other indicators of effective administration determined by the Secretary;
‘‘(ii) establish, by regulation, standards for high
and most improved performance to be used in awarding
performance bonus payments under subparagraph
(B)(ii); and
‘‘(iii) before issuing proposed regulations to carry
out clauses (i) and (ii), solicit ideas for performance
criteria and standards for high and most improved
performance from State agencies and organizations
that represent State interests.
‘‘(B) PERFORMANCE BONUS PAYMENTS.—With respect to
fiscal year 2005 and each fiscal year thereafter, the Secretary shall—
‘‘(i) measure the performance of each State agency
with respect to the criteria established under subparagraph (A)(i); and
‘‘(ii) subject to paragraph (3), award performance
bonus payments in the following fiscal year, in a total
amount of $48,000,000 for each fiscal year, to State
agencies that meet standards for high or most
improved performance established by the Secretary
under subparagraph (A)(ii).
‘‘(3) PROHIBITION ON RECEIPT OF PERFORMANCE BONUS PAYMENTS.—A State agency shall not be eligible for a performance
bonus payment with respect to any fiscal year for which the

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State agency has a liability amount established under subsection (c)(1)(C).
‘‘(4) PAYMENTS NOT SUBJECT TO JUDICIAL REVIEW.—A determination by the Secretary whether, and in what amount, to
award a performance bonus payment under this subsection
shall not be subject to administrative or judicial review.’’.
(b) EFFECTIVE DATE.—The amendment made by this section
takes effect on the date of enactment of this Act.

7 USC 2025 note.

SEC. 4121. EMPLOYMENT AND TRAINING PROGRAM.

(a) LEVELS OF FUNDING.—Section 16(h)(1) of the Food Stamp
Act of 1977 (7 U.S.C. 2025(h)(1)) is amended—
(1) in subparagraph (A), by striking clause (vii) and
inserting the following:
‘‘(vii) for each of fiscal years 2002 through 2007,
$90,000,000.’’;
(2) by striking subparagraph (B) and inserting the following:
‘‘(B) ALLOCATION.—Funds made available under
subparagraph (A) shall be made available to and reallocated among State agencies under a reasonable formula
that—
‘‘(i) is determined and adjusted by the Secretary;
and
‘‘(ii) takes into account the number of individuals
who are not exempt from the work requirement under
section 6(o).’’; and
(3) by striking subparagraphs (E) through (G) and inserting
the following:
‘‘(E) ADDITIONAL ALLOCATIONS FOR STATES THAT
ENSURE AVAILABILITY OF WORK OPPORTUNITIES.—
‘‘(i) IN GENERAL.—In addition to the allocations
under subparagraph (A), from funds made available
under section 18(a)(1), the Secretary shall allocate not
more than $20,000,000 for each of fiscal years 2002
through 2007 to reimburse a State agency that is
eligible under clause (ii) for the costs incurred in
serving food stamp recipients who—
‘‘(I) are not eligible for an exception under
section 6(o)(3); and
‘‘(II) are placed in and comply with a program
described in subparagraph (B) or (C) of section
6(o)(2).
‘‘(ii) ELIGIBILITY.—To be eligible for an additional
allocation under clause (i), a State agency shall make
and comply with a commitment to offer a position
in a program described in subparagraph (B) or (C)
of section 6(o)(2) to each applicant or recipient who—
‘‘(I) is in the last month of the 3-month period
described in section 6(o)(2);
‘‘(II) is not eligible for an exception under section 6(o)(3);
‘‘(III) is not eligible for a waiver under section
6(o)(4); and
‘‘(IV) is not exempt under section 6(o)(6).’’.
(b) CARRYOVER FUNDS.—Notwithstanding any other provision
of law, funds provided under section 16(h)(1)(A) of the Food Stamp

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7 USC 2015 note.

PUBLIC LAW 107–171—MAY 13, 2002

Act of 1977 (7 U.S.C. 2025(h)(1)(A)) for any fiscal year before
fiscal year 2002 shall be rescinded on the date of enactment of
this Act, unless obligated by a State agency before that date.
(c) PARTICIPANT EXPENSES.—Section 6(d)(4)(I)(i)(I) of the Food
Stamp Act of 1977 (7 U.S.C. 2015(d)(4)(I)(i)(I)) is amended by
striking ‘‘, except that the State agency may limit such reimbursement to each participant to $25 per month’’.
(d) FEDERAL REIMBURSEMENT.—Section 16(h)(3) of the Food
Stamp Act of 1977 (7 U.S.C. 2025(h)(3)) is amended by striking
‘‘such total amount shall not exceed an amount representing $25
per participant per month for costs of transportation and other
actual costs (other than dependent care costs) and’’ and inserting
‘‘the amount of the reimbursement for dependent care expenses
shall not exceed’’.
(e) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.
SEC. 4122. REAUTHORIZATION OF FOOD STAMP PROGRAM AND FOOD
DISTRIBUTION PROGRAM ON INDIAN RESERVATIONS.

(a) REDUCTIONS IN PAYMENTS FOR ADMINISTRATIVE COSTS.—
Section 16(k)(3) of the Food Stamp Act of 1977 (7 U.S.C. 2025(k)(3))
is amended—
(1) in the first sentence of subparagraph (A), by striking
‘‘2002’’ and inserting ‘‘2007’’; and
(2) in subparagraph (B)(ii), by striking ‘‘2002’’ and inserting
‘‘2007’’.
(b) CASH PAYMENT PILOT PROJECTS.—Section 17(b)(1)(B)(vi) of
the Food Stamp Act of 1977 (7 U.S.C. 2026(b)(1)(B)(vi)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
(c) AUTHORIZATION OF APPROPRIATIONS.—Section 18(a)(1) of the
Food Stamp Act of 1977 (7 U.S.C. 2027(a)(1)) is amended in the
first sentence by striking ‘‘1996 through 2002’’ and inserting ‘‘2003
through 2007’’.
SEC. 4123. EXPANDED GRANT AUTHORITY.

7 USC 2026 note.

(a) IN GENERAL.—Section 17(a)(1) of the Food Stamp Act of
1977 (7 U.S.C. 2026(a)(1)) is amended—
(1) by striking ‘‘, by way of making contracts with or
grants to public or private organizations or agencies,’’ and
inserting ‘‘enter into contracts with or make grants to public
or private organizations or agencies under this section to’’;
and
(2) by adding at the end the following: ‘‘The waiver
authority of the Secretary under subsection (b) shall extend
to all contracts and grants under this section.’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.
SEC. 4124. CONSOLIDATED BLOCK GRANTS FOR PUERTO RICO AND
AMERICAN SAMOA.

(a) CONSOLIDATED FUNDING.—Section 19 of the Food Stamp
Act of 1977 (7 U.S.C. 2028) is amended—
(1) by striking the section heading and ‘‘(a)(1)(A) From’’
and all that follows through ‘‘(2) The’’ and inserting the following:

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‘‘SEC. 19. CONSOLIDATED BLOCK GRANTS FOR PUERTO RICO AND
AMERICAN SAMOA.

‘‘(a) PAYMENTS TO GOVERNMENTAL ENTITIES.—
‘‘(1) DEFINITION OF GOVERNMENTAL ENTITY.—In this subsection, the term ‘governmental entity’ means—
‘‘(A) the Commonwealth of Puerto Rico; and
‘‘(B) American Samoa.
‘‘(2) BLOCK GRANTS.—
‘‘(A) AMOUNT OF BLOCK GRANTS.—From the sums
appropriated under this Act, the Secretary shall, subject
to this section, pay to governmental entities to pay the
expenditures for nutrition assistance programs for needy
persons as described in subparagraphs (B) and (C)—
‘‘(i) for fiscal year 2003, $1,401,000,000; and
‘‘(ii) for each of fiscal years 2004 through 2007,
the amount specified in clause (i), as adjusted by the
percentage by which the thrifty food plan has been
adjusted under section 3(o)(4) between June 30, 2002,
and June 30 of the immediately preceding fiscal year.
‘‘(B) PAYMENTS TO COMMONWEALTH OF PUERTO RICO.—
‘‘(i) IN GENERAL.—For fiscal year 2003 and each
fiscal year thereafter, the Secretary shall use 99.6 percent of the funds made available under subparagraph
(A) for payment to the Commonwealth of Puerto Rico
to pay—
‘‘(I) 100 percent of the expenditures by the
Commonwealth for the fiscal year for the provision
of nutrition assistance included in the plan of the
Commonwealth approved under subsection (b); and
‘‘(II) 50 percent of the related administrative
expenses.
‘‘(ii) EXCEPTION FOR EXPENDITURES FOR CERTAIN
SYSTEMS.—Notwithstanding clause (i), the Commonwealth of Puerto Rico may spend in fiscal year 2002
or 2003 not more than $6,000,000 of the amount
required to be paid to the Commonwealth for fiscal
year 2002 under this paragraph (as in effect on the
day before the date of enactment of this clause) to
pay 100 percent of the costs of—
‘‘(I) upgrading and modernizing the electronic
data processing system used to carry out nutrition
assistance programs for needy persons;
‘‘(II) implementing systems to simplify the
determination of eligibility to receive the nutrition
assistance; and
‘‘(III) operating systems to deliver the nutrition assistance through electronic benefit transfers.
‘‘(C) PAYMENTS TO AMERICAN SAMOA.—For fiscal year
2003 and each fiscal year thereafter, the Secretary shall
use 0.4 percent of the funds made available under subparagraph (A) for payment to American Samoa to pay 100
percent of the expenditures by American Samoa for a nutrition assistance program extended under section 601(c) of
Public Law 96–597 (48 U.S.C. 1469d(c)).
‘‘(D) CARRYOVER OF FUNDS.—For fiscal year 2002 and
each fiscal year thereafter, not more than 2 percent of
the funds made available under this paragraph for the

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7 USC 2028 note.

7 USC 2028 note.

PUBLIC LAW 107–171—MAY 13, 2002

fiscal year to each governmental entity may be carried
over to the following fiscal year.
‘‘(3) TIME AND MANNER OF PAYMENTS TO COMMONWEALTH
OF PUERTO RICO.—The’’;
(2) in subsection (b), by striking ‘‘subsection (a)(1)(A)’’ each
place it appears and inserting ‘‘subsection (a)(2)(B)’’; and
(3) in subsection (c), by striking ‘‘subsection (a)(1)(A)’’ each
place it appears and inserting ‘‘subsection (a)(2)(A)’’.
(b) CONFORMING AMENDMENT.—Section 24 of the Food Stamp
Act of 1977 (7 U.S.C. 2033) is repealed.
(c) APPLICABILITY.—
(1) IN GENERAL.—Except as provided in paragraph (2), the
amendments made by this section apply beginning on October
1, 2002.
(2) EXCEPTIONS.—Subparagraphs (B)(ii) and (D) of section
19(a)(2) of the Food Stamp Act of 1977 (as amended by subsection (a)(1)) apply beginning on the date of enactment of
this Act.
(d) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.
SEC. 4125. ASSISTANCE FOR COMMUNITY FOOD PROJECTS.

Contracts.

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(a) IN GENERAL.—Section 25 of the Food Stamp Act of 1977
(7 U.S.C. 2034) is amended—
(1) in subsection (a)—
(A) by striking ‘‘(1)’’ and inserting ‘‘(1)(A)’’;
(B) by redesignating paragraphs (2) and (3) as subparagraphs (B) and (C), respectively, of paragraph (1);
(C) in paragraph (1)(C) (as redesignated by subparagraph (B)), by striking the period at the end and inserting
‘‘; or’’; and
(D) by adding at the end the following:
‘‘(2) meet specific State, local, or neighborhood food and
agricultural needs, including needs for—
‘‘(A) infrastructure improvement and development;
‘‘(B) planning for long-term solutions; or
‘‘(C) the creation of innovative marketing activities that
mutually benefit agricultural producers and low-income
consumers.’’;
(2) in subsection (b)(2)(B)—
(A) by striking ‘‘$2,500,000’’ and inserting ‘‘$5,000,000’’;
and
(B) by striking ‘‘2002’’ and inserting ‘‘2007’’;
(3) in subsection (d), by striking paragraph (4) and inserting
the following:
‘‘(4) encourage long-term planning activities, and multisystem, interagency approaches with multistakeholder
collaborations, that build the long-term capacity of communities
to address the food and agricultural problems of the communities, such as food policy councils and food planning associations.’’; and
(4) by striking subsection (h) and inserting the following:
‘‘(h) INNOVATIVE PROGRAMS FOR ADDRESSING COMMON COMMUNITY PROBLEMS.—
‘‘(1) IN GENERAL.—The Secretary shall offer to enter into
a contract with, or make a grant to, 1 nongovernmental
organization that meets the requirements of paragraph (2) to

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coordinate with Federal agencies, States, political subdivisions,
and nongovernmental organizations (collectively referred to in
this subsection as ‘targeted entities’) to gather information,
and recommend to the targeted entities, innovative programs
for addressing common community problems, including—
‘‘(A) loss of farms and ranches;
‘‘(B) rural poverty;
‘‘(C) welfare dependency;
‘‘(D) hunger;
‘‘(E) the need for job training; and
‘‘(F) the need for self-sufficiency by individuals and
communities.
‘‘(2) NONGOVERNMENTAL ORGANIZATION.—The nongovernmental organization referred to in paragraph (1) shall—
‘‘(A) be selected by the Secretary on a competitive
basis;
‘‘(B) be experienced in working with other targeted
entities and in organizing workshops that demonstrate programs to other targeted entities;
‘‘(C) be experienced in identifying programs that effectively address community problems described in paragraph
(1) that can be implemented by other targeted entities;
‘‘(D) be experienced in, and capable of, receiving
information from and communicating with other targeted
entities throughout the United States;
‘‘(E) be experienced in operating a national information
clearinghouse that addresses 1 or more of the community
problems described in paragraph (1); and
‘‘(F) as a condition of entering into the contract or
receiving the grant referred to in paragraph (1), agree—
‘‘(i) to contribute in-kind resources toward
implementation of the contract or grant;
‘‘(ii) to provide to other targeted entities information and guidance on the innovative programs referred
to in paragraph (1); and
‘‘(iii) to operate a national information clearinghouse on innovative means for addressing community
problems described in paragraph (1) that—
‘‘(I) is easily usable by—
‘‘(aa) Federal, State, and local government
agencies;
‘‘(bb) local community leaders;
‘‘(cc) nongovernmental organizations; and
‘‘(dd) the public; and
‘‘(II) includes information on approved community food projects.
‘‘(3) AUDITS; EFFECTIVE USE OF FUNDS.—The Secretary shall
establish auditing procedures and otherwise ensure the effective
use of funds made available to carry out this subsection.
‘‘(4) FUNDING.—Not later than 90 days after the date of
enactment of this paragraph, and on October 1 of each of
fiscal years 2003 through 2007, the Secretary shall allocate
to carry out this subsection $200,000 of the funds made available under subsection (b), to remain available until expended.’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.

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SEC. 4126. AVAILABILITY OF COMMODITIES FOR THE EMERGENCY
FOOD ASSISTANCE PROGRAM.

7 USC 2036 note.

(a) IN GENERAL.—Section 27(a) of the Food Stamp Act of 1977
(7 U.S.C. 2036(a)) is amended—
(1) by striking ‘‘1997 through 2002’’ and inserting ‘‘2002
through 2007’’; and
(2) by striking ‘‘$100,000,000’’ and inserting ‘‘$140,000,000’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect on October 1, 2001.

Subtitle B—Commodity Distribution
SEC. 4201. COMMODITY SUPPLEMENTAL FOOD PROGRAM.

(a) COMMODITY DISTRIBUTION PROGRAM.—Section 4(a) of the
Agriculture and Consumer Protection Act of 1973 (7 U.S.C. 612c
note; Public Law 93–86) is amended in the first sentence by striking
‘‘2002’’ and inserting ‘‘2007’’.
(b) COMMODITY SUPPLEMENTAL FOOD PROGRAM.—Section 5 of
the Agriculture and Consumer Protection Act of 1973 (7 U.S.C.
612c note; Public Law 93–86) is amended—
(1) by striking subsection (a) and inserting the following:
‘‘(a) GRANTS PER ASSIGNED CASELOAD SLOT.—
‘‘(1) IN GENERAL.—In carrying out the program under section 4 (referred to in this section as the ‘commodity supplemental food program’), for each of fiscal years 2003 through
2007, the Secretary shall provide to each State agency from
funds made available to carry out that section (including any
such funds remaining available from the preceding fiscal year),
a grant per assigned caseload slot for administrative costs
incurred by the State agency and local agencies in the State
in operating the commodity supplemental food program.
‘‘(2) AMOUNT OF GRANTS.—
‘‘(A) FISCAL YEAR 2003.—For fiscal year 2003, the
amount of each grant per assigned caseload slot shall be
equal to the amount of the grant per assigned caseload
slot for administrative costs in 2001, adjusted by the
percentage change between—
‘‘(i) the value of the State and local government
price index, as published by the Bureau of Economic
Analysis of the Department of Commerce, for the 12month period ending June 30, 2001; and
‘‘(ii) the value of that index for the 12-month period
ending June 30, 2002.
‘‘(B) FISCAL YEARS 2004 THROUGH 2007.—For each of
fiscal years 2004 through 2007, the amount of each grant
per assigned caseload slot shall be equal to the amount
of the grant per assigned caseload slot for the preceding
fiscal year, adjusted by the percentage change between—
‘‘(i) the value of the State and local government
price index, as published by the Bureau of Economic
Analysis of the Department of Commerce, for the 12month period ending June 30 of the second preceding
fiscal year; and
‘‘(ii) the value of that index for the 12-month period
ending June 30 of the preceding fiscal year.’’;

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(2) in subsection (d)(2), by striking ‘‘2002’’ each place it
appears and inserting ‘‘2007’’; and
(3) by striking subsection (l) and inserting the following:
‘‘(l) USE OF APPROVED FOOD SAFETY TECHNOLOGY.—
‘‘(1) IN GENERAL.—In acquiring commodities for distribution
through a program specified in paragraph (2), the Secretary
shall not prohibit the use of any technology to improve food
safety that—
‘‘(A) has been approved by the Secretary; or
‘‘(B) has been approved or is otherwise allowed by
the Secretary of Health and Human Services.
‘‘(2) PROGRAMS.—A program referred to in paragraph (1)
is a program authorized under—
‘‘(A) this Act;
‘‘(B) the Food Stamp Act of 1977 (7 U.S.C. 2011 et
seq.);
‘‘(C) the Emergency Food Assistance Act of 1983 (7
U.S.C. 7501 et seq.);
‘‘(D) the Richard B. Russell National School Lunch
Act (42 U.S.C. 1751 et seq.); or
‘‘(E) the Child Nutrition Act of 1966 (42 U.S.C. 1771
et seq.).’’.
(c) ADDITIONAL FUNDING FOR CERTAIN STATES.—
(1) IN GENERAL.—Not later than 30 days after the date
of enactment of this Act, of the funds of the Commodity Credit
Corporation, the Secretary of Agriculture shall make available
an amount equal to the amount that the Secretary of Agriculture determines to be necessary to permit each State that
began administering the commodity supplemental food program
under the Agriculture and Consumer Protection Act of 1973
(7 U.S.C. 612c note; Public Law 93–86) in the 2000 caseload
cycle to administer the program, through the 2002 caseload
cycle, at a caseload level that is not less than the originally
assigned caseload level of the State.
(2) PROVISION TO STATES.—The Secretary shall provide to
each State described in paragraph (1) for the purpose described
in that paragraph the funds made available under that paragraph.
(d) EFFECTIVE DATE.—The amendment made by subsection
(b)(3) takes effect on the date of enactment of this Act.

7 USC 612c note.

7 USC 612c note.

SEC. 4202. COMMODITY DONATIONS.

(a) IN GENERAL.—The Commodity Distribution Reform Act and
WIC Amendments of 1987 (7 U.S.C. 612c note; Public Law 100–
237) is amended—
(1) by redesignating sections 17 and 18 as sections 18
and 19, respectively; and
(2) by inserting after section 16 the following:
‘‘SEC. 17. COMMODITY DONATIONS.

‘‘(a) IN GENERAL.—Notwithstanding any other provision of law
concerning commodity donations, any commodities acquired in the
conduct of the operations of the Commodity Credit Corporation
and any commodities acquired under section 32 of the Act of August
24, 1935 (7 U.S.C. 612c), to the extent that the commodities are
in excess of the quantities of commodities that are essential to
carry out other authorized activities of the Commodity Credit Corporation and the Secretary (including any quantity specifically

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PUBLIC LAW 107–171—MAY 13, 2002

reserved for a specific purpose), may be used for any program
authorized to be carried out by the Secretary that involves the
acquisition of commodities for use in a domestic feeding program,
including any program conducted by the Secretary that provides
commodities to individuals in cases of hardship.
‘‘(b) PROGRAMS.—A program described in subsection (a) includes
a program authorized by—
‘‘(1) the Emergency Food Assistance Act of 1983 (7 U.S.C.
7501 et seq.);
‘‘(2) the Richard B. Russell National School Lunch Act
(42 U.S.C. 1751 et seq.);
‘‘(3) the Child Nutrition Act of 1966 (42 U.S.C. 1771 et
seq.);
‘‘(4) the Older Americans Act of 1965 (42 U.S.C. 3001
et seq.); or
‘‘(5) such other laws as the Secretary determines to be
appropriate.’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.
SEC. 4203. DISTRIBUTION OF SURPLUS COMMODITIES TO SPECIAL
NUTRITION PROJECTS.

Section 1114(a)(2)(A) of the Agriculture and Food Act of 1981
(7 U.S.C. 1431e(2)(A)) is amended in the first sentence by striking
‘‘2002’’ and inserting ‘‘2007’’.
SEC. 4204. EMERGENCY FOOD ASSISTANCE.

Section 204(a)(1) of the Emergency Food Assistance Act of
1983 (7 U.S.C. 7508(a)(1)) is amended in the first sentence—
(1) by striking ‘‘$50,000,000’’ and inserting ‘‘$60,000,000’’;
(2) by striking ‘‘1991 through 2002’’ and inserting ‘‘2003
through 2007’’;
(3) by striking ‘‘administrative’’;
(4) by inserting ‘‘storage,’’ after ‘‘processing,’’; and
(5) by inserting ‘‘, including commodities secured by
gleaning (as defined in section 111(a) of the Hunger Prevention
Act of 1988 (7 U.S.C. 612c note; Public Law 100–435))’’ after
‘‘sources’’.

Subtitle C—Child Nutrition and Related
Programs
SEC. 4301. COMMODITIES FOR SCHOOL LUNCH PROGRAM.

42 USC 1755
note.

(a) IN GENERAL.—Section 6(e)(1)(B) of the Richard B. Russell
National School Lunch Act (42 U.S.C. 1755(e)(1)(B)) is amended
by striking ‘‘2001’’ and inserting ‘‘2003’’.
(b) EFFECTIVE DATE.—The amendment made by this section
takes effect on the date of enactment of this Act.
SEC. 4302. ELIGIBILITY FOR FREE AND REDUCED PRICE MEALS.

(a) IN GENERAL.—Section 9(b) of the Richard B. Russell
National School Lunch Act (42 U.S.C. 1758(b)) is amended by adding
at the end the following:
‘‘(7) EXCLUSION OF CERTAIN MILITARY HOUSING ALLOWANCES.—For each of fiscal years 2002 and 2003, the amount
of a basic allowance provided under section 403 of title 37,

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United States Code, on behalf of a member of a uniformed
service for housing that is acquired or constructed under subchapter IV of chapter 169 of title 10, United States Code,
or any related provision of law, shall not be considered to
be income for the purpose of determining the eligibility of
a child who is a member of the household of the member
of a uniformed service for free or reduced price lunches under
this Act.’’.
(b) EFFECTIVE DATE.—The amendment made by this section
takes effect on the date of enactment of this Act.

42 USC 1758
note.

SEC. 4303. PURCHASES OF LOCALLY PRODUCED FOODS.

Section 9 of the Richard B. Russell National School Lunch
Act (42 U.S.C. 1758) is amended by adding at the end the following:
‘‘(j) PURCHASES OF LOCALLY PRODUCED FOODS.—
‘‘(1) IN GENERAL.—The Secretary shall—
‘‘(A) encourage institutions participating in the school
lunch program under this Act and the school breakfast
program established by section 4 of the Child Nutrition
Act of 1966 (42 U.S.C. 1773) to purchase, in addition to
other food purchases, locally produced foods for school meal
programs, to the maximum extent practicable and appropriate;
‘‘(B) advise institutions participating in a program
described in subparagraph (A) of the policy described in
that subparagraph and post information concerning the
policy on the website maintained by the Secretary; and
‘‘(C) in accordance with requirements established by
the Secretary, provide startup grants to not more than
200 institutions to defray the initial costs of equipment,
materials, and storage facilities, and similar costs, incurred
in carrying out the policy described in subparagraph (A).
‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(A) IN GENERAL.—There is authorized to be appropriated to carry out this subsection $400,000 for each of
fiscal years 2003 through 2007, to remain available until
expended.
‘‘(B) LIMITATION.—No amounts may be made available
to carry out this subsection unless specifically provided
by an appropriation Act.’’.
SEC. 4304. APPLICABILITY OF BUY-AMERICAN REQUIREMENT TO
PUERTO RICO.

Section 12(n) of the Richard B. Russell National School Lunch
Act (42 U.S.C. 1760(n)) is amended by adding at the end the
following:
‘‘(4) APPLICABILITY TO PUERTO RICO.—Paragraph (2)(A) shall
apply to a school food authority in the Commonwealth of Puerto
Rico with respect to domestic commodities or products that
are produced in the Commonwealth of Puerto Rico in sufficient
quantities to meet the needs of meals provided under the school
lunch program under this Act or the school breakfast program
under section 4 of the Child Nutrition Act of 1966 (42 U.S.C.
1773).’’.

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SEC. 4305. FRUIT AND VEGETABLE PILOT PROGRAM.

Deadline.

42 USC 1769
note.

(a) IN GENERAL.—Section 18 of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1769) is amended by adding at the
end the following:
‘‘(g) FRUIT AND VEGETABLE PILOT PROGRAM.—
‘‘(1) IN GENERAL.—In the school year beginning July 2002,
the Secretary shall carry out a pilot program to make available
to students in 25 elementary or secondary schools in each
of 4 States, and in elementary or secondary schools on 1 Indian
reservation, free fresh and dried fruits and fresh vegetables
throughout the school day in 1 or more areas designated by
the school.
‘‘(2) PUBLICITY.—A school that participates in the pilot
program shall widely publicize within the school the availability
of free fruits and vegetables under the pilot program.
‘‘(3) REPORT.—Not later than May 1, 2003, the Secretary,
acting through the Administrator of the Economic Research
Service, shall report to the Committee on Education and the
Workforce of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate on the
results of the pilot program.
‘‘(4) FUNDING.—The Secretary shall use not more than
$6,000,000 of funds made available under section 32 of the
Act of August 24, 1935 (7 U.S.C. 612c), to carry out this subsection (other than paragraph (3)).’’.
(b) EFFECTIVE DATE.—The amendment made by this section
takes effect on the date of enactment of this Act.
SEC. 4306. ELIGIBILITY FOR ASSISTANCE UNDER THE SPECIAL
SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN,
INFANTS, AND CHILDREN.

42 USC 1786
note.

(a) IN GENERAL.—Section 17(d)(2)(B)(i) of the Child Nutrition
Act of 1966 (42 U.S.C. 1786(d)(2)(B)(i)) is amended—
(1) by striking ‘‘basic allowance for housing’’ and inserting
the following: ‘‘basic allowance—
‘‘(I) for housing’’;
(2) by striking ‘‘and’’ at the end and inserting ‘‘or’’; and
(3) by adding at the end the following:
‘‘(II) provided under section 403 of title 37, United
States Code, for housing that is acquired or constructed
under subchapter IV of chapter 169 of title 10, United
States Code, or any related provision of law; and’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.
SEC. 4307. WIC FARMERS’ MARKET NUTRITION PROGRAM.

Deadline.

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(a) IN GENERAL.—Section 17(m)(9) of the Child Nutrition Act
of 1966 (42 U.S.C. 1786(m)(9)) is amended—
(1) by striking ‘‘(9)(A) There’’ and inserting the following:
‘‘(9) FUNDING.—
‘‘(A) IN GENERAL.—
‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There’’;
and
(2) in subparagraph (A), by adding at the end the following:
‘‘(ii) MANDATORY FUNDING.—Not later than 30 days
after the date of enactment of the Food Stamp

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Reauthorization Act of 2002, of the funds of the Commodity Credit Corporation, the Secretary shall make
available to carry out this subsection $15,000,000, to
remain available until expended.’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect on the date of enactment of this Act.

42 USC 1786
note.

Subtitle D—Miscellaneous
SEC.

4401.

PARTIAL RESTORATION
IMMIGRANTS.

OF

BENEFITS

TO

LEGAL

(a) RESTORATION OF BENEFITS TO DISABLED ALIENS.—Section
402(a)(2)(F) of the Personal Responsibility and Work Opportunity
Reconciliation Act of 1996 (8 U.S.C. 1612(a)(2)(F)) is amended by
striking ‘‘(i) was’’ and all that follows through ‘‘(II) in the case’’
and inserting the following:
‘‘(i) in the case of the specified Federal program
described in paragraph (3)(A)—
‘‘(I) was lawfully residing in the United States
on August 22, 1996; and
‘‘(II) is blind or disabled (as defined in paragraph (2) or (3) of section 1614(a) of the Social
Security Act (42 U.S.C. 1382c(a))); and
‘‘(ii) in the case’’.
(b) RESTORATION OF BENEFITS TO ALL QUALIFIED ALIEN CHILDREN.—
(1) IN GENERAL.—Section 402(a)(2)(J) of the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996
(8 U.S.C. 1612(a)(2)(J)) is amended by striking ‘‘who’’ and all
that follows through ‘‘is under’’ and inserting ‘‘who is under’’.
(2) CONFORMING AMENDMENTS.—
(A) Section 403(c)(2) of the Personal Responsibility and
Work Opportunity Reconciliation Act of 1996 (8 U.S.C.
1613(c)(2)) is amended by adding at the end the following:
‘‘(L) Assistance or benefits provided to individuals
under the age of 18 under the Food Stamp Act of 1977
(7 U.S.C. 2011 et seq.).’’.
(B) Section 421(d) of the Personal Responsibility and
Work Opportunity Reconciliation Act of 1996 (8 U.S.C.
1631(d)) is amended by adding at the end the following:
‘‘(3) This section shall not apply to assistance or benefits
under the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.)
to the extent that a qualified alien is eligible under section
402(a)(2)(J).’’.
(C) Section 5(i)(2)(E) of the Food Stamp Act of 1977
(7 U.S.C. 2014(i)(2)(E)) is amended by inserting before the
period at the end the following: ‘‘, or to any alien who
is under 18 years of age’’.
(3) EFFECTIVE DATE.—The amendments made by this subsection take effect on October 1, 2003.
(c) FOOD STAMP EXCEPTION FOR CERTAIN QUALIFIED ALIENS.—
(1) IN GENERAL.—Section 402(a)(2) of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (8
U.S.C. 1612(a)(2)) is amended by adding at the end the following:

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Applicability.

7 USC 2014 note.

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(L) FOOD STAMP EXCEPTION FOR CERTAIN QUALIFIED
ALIENS.—With respect to eligibility for benefits for the
specified Federal program described in paragraph (3)(B),
paragraph (1) shall not apply to any qualified alien who
has resided in the United States with a status within
the meaning of the term ‘qualified alien’ for a period of
5 years or more beginning on the date of the alien’s entry
into the United States.’’.
(2) EFFECTIVE DATE.—The amendment made by paragraph
(1) takes effect on April 1, 2003.

8 USC 1612 note.

SEC. 4402. SENIORS FARMERS’ MARKET NUTRITION PROGRAM.

7 USC 3007.

(a) ESTABLISHMENT.—The Secretary of Agriculture shall use
$5,000,000 for fiscal year 2002, and $15,000,000 for each of fiscal
years 2003 through 2007, of the funds available to the Commodity
Credit Corporation to carry out and expand a seniors farmers’
market nutrition program.
(b) PROGRAM PURPOSES.—The purposes of the seniors farmers’
market nutrition program are—
(1) to provide resources in the form of fresh, nutritious,
unprepared, locally grown fruits, vegetables, and herbs from
farmers’ markets, roadside stands, and community supported
agriculture programs to low-income seniors;
(2) to increase the domestic consumption of agricultural
commodities by expanding or aiding in the expansion of
domestic farmers’ markets, roadside stands, and community
supported agriculture programs; and
(3) to develop or aid in the development of new and additional farmers’ markets, roadside stands, and community supported agriculture programs.
(c) REGULATIONS.—The Secretary may issue such regulations
as the Secretary considers necessary to carry out the seniors
farmers’ market nutrition program.
7 USC 3171 note.

SEC. 4403. NUTRITION INFORMATION AND AWARENESS PILOT PROGRAM.

(a) ESTABLISHMENT.—The Secretary of Agriculture may establish, in not more than 5 States, for a period not to exceed 4
years for each participating State, a pilot program to increase
the domestic consumption of fresh fruits and vegetables.
(b) PURPOSE.—
(1) IN GENERAL.—Subject to paragraph (2), the purpose
of the program shall be to provide funds to States solely for
the purpose of assisting eligible public and private sector entities with cost-share assistance to carry out demonstration
projects—
(A) to increase fruit and vegetable consumption; and
(B) to convey related health promotion messages.
(2) LIMITATION.—Funds made available to a State under
the program shall not be used to disparage any agricultural
commodity.
(c) SELECTION OF STATES.—
(1) IN GENERAL.—In selecting States to participate in the
program, the Secretary shall take into consideration, with
respect to projects and activities proposed to be carried out
under the program—
(A) experience in carrying out similar projects or activities;

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(B) innovative approaches; and
(C) the ability of the State to promote and track
increases in levels of fruit and vegetable consumption.
(2) ENHANCEMENT OF EXISTING STATE PROGRAMS.—The Secretary may use the pilot program to enhance existing State
programs that are consistent with the purpose of the pilot
program specified in subsection (b).
(d) ELIGIBLE PUBLIC AND PRIVATE SECTOR ENTITIES.—
(1) IN GENERAL.—A participating State shall establish eligibility criteria under which the State may select public and
private sector entities to carry out demonstration projects under
the program.
(2) LIMITATION.—No funds made available to States under
the program shall be provided by a State to any foreign forprofit corporation.
(e) FEDERAL SHARE.—The Federal share of the cost of any
project or activity carried out using funds provided under this
section shall be 50 percent.
(f) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $10,000,000 for each
of fiscal years 2002 through 2007.
SEC. 4404. HUNGER FELLOWSHIP PROGRAM.

(a) SHORT TITLE; FINDINGS.—
(1) SHORT TITLE.—This section may be cited as the
‘‘Congressional Hunger Fellows Act of 2002’’.
(2) FINDINGS.—The Congress finds as follows:
(A) There is a critical need for compassionate individuals who are committed to assisting people who suffer
from hunger as well as a need for such individuals to
initiate and administer solutions to the hunger problem.
(B) Bill Emerson, the distinguished late Representative
from the 8th District of Missouri, demonstrated his commitment to solving the problem of hunger in a bipartisan
manner, his commitment to public service, and his great
affection for the institution and the ideals of the United
States Congress.
(C) George T. (Mickey) Leland, the distinguished late
Representative from the 18th District of Texas, demonstrated his compassion for those in need, his high regard
for public service, and his lively exercise of political talents.
(D) The special concern that Mr. Emerson and Mr.
Leland demonstrated during their lives for the hungry
and poor was an inspiration for others to work toward
the goals of equality and justice for all.
(E) These two outstanding leaders maintained a special
bond of friendship regardless of political affiliation and
worked together to encourage future leaders to recognize
and provide service to others, and therefore it is especially
appropriate to honor the memory of Mr. Emerson and
Mr. Leland by creating a fellowship program to develop
and train the future leaders of the United States to pursue
careers in humanitarian service.
(b) ESTABLISHMENT.—There is established as an independent
entity of the legislative branch of the United States Government
the Congressional Hunger Fellows Program (hereinafter in this
section referred to as the ‘‘Program’’).

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Congressional
Hunger Fellows
Act of 2002.
2 USC 1161.

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PUBLIC LAW 107–171—MAY 13, 2002
(c) BOARD OF TRUSTEES.—
(1) IN GENERAL.—The Program shall be subject to the
supervision and direction of a Board of Trustees.
(2) MEMBERS OF THE BOARD OF TRUSTEES.—
(A) APPOINTMENT.—The Board shall be composed of
6 voting members appointed under clause (i) and one nonvoting ex officio member designated in clause (ii) as follows:
(i) VOTING MEMBERS.—(I) The Speaker of the
House of Representatives shall appoint two members.
(II) The minority leader of the House of Representatives shall appoint one member.
(III) The majority leader of the Senate shall
appoint two members.
(IV) The minority leader of the Senate shall
appoint one member.
(ii) NONVOTING MEMBER.—The Executive Director
of the program shall serve as a nonvoting ex officio
member of the Board.
(B) TERMS.—Members of the Board shall serve a term
of 4 years.
(C) VACANCY.—
(i) AUTHORITY OF BOARD.—A vacancy in the membership of the Board does not affect the power of the
remaining members to carry out this section.
(ii) APPOINTMENT OF SUCCESSORS.—A vacancy in
the membership of the Board shall be filled in the
same manner in which the original appointment was
made.
(iii) INCOMPLETE TERM.—If a member of the Board
does not serve the full term applicable to the member,
the individual appointed to fill the resulting vacancy
shall be appointed for the remainder of the term of
the predecessor of the individual.
(D) CHAIRPERSON.—As the first order of business of
the first meeting of the Board, the members shall elect
a Chairperson.
(E) COMPENSATION.—
(i) IN GENERAL.—Subject to clause (ii), members
of the Board may not receive compensation for service
on the Board.
(ii) TRAVEL.—Members of the Board may be
reimbursed for travel, subsistence, and other necessary
expenses incurred in carrying out the duties of the
program.
(3) DUTIES.—
(A) BYLAWS.—
(i) ESTABLISHMENT.—The Board shall establish
such bylaws and other regulations as may be appropriate to enable the Board to carry out this section,
including the duties described in this paragraph.
(ii) CONTENTS.—Such bylaws and other regulations
shall include provisions—
(I) for appropriate fiscal control, funds
accountability, and operating principles;
(II) to prevent any conflict of interest, or the
appearance of any conflict of interest, in the
procurement and employment actions taken by the

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Board or by any officer or employee of the Board
and in the selection and placement of individuals
in the fellowships developed under the program;
(III) for the resolution of a tie vote of the
members of the Board; and
(IV) for authorization of travel for members
of the Board.
(iii) TRANSMITTAL TO CONGRESS.—Not later than
90 days after the date of the first meeting of the
Board, the Chairperson of the Board shall transmit
to the appropriate congressional committees a copy
of such bylaws.
(B) BUDGET.—For each fiscal year the program is in
operation, the Board shall determine a budget for the program for that fiscal year. All spending by the program
shall be pursuant to such budget unless a change is
approved by the Board.
(C) PROCESS FOR SELECTION AND PLACEMENT OF FELLOWS.—The Board shall review and approve the process
established by the Executive Director for the selection and
placement of individuals in the fellowships developed under
the program.
(D) ALLOCATION OF FUNDS TO FELLOWSHIPS.—The
Board of Trustees shall determine the priority of the programs to be carried out under this section and the amount
of funds to be allocated for the Emerson and Leland fellowships.
(d) PURPOSES; AUTHORITY OF PROGRAM.—
(1) PURPOSES.—The purposes of the program are—
(A) to encourage future leaders of the United States
to pursue careers in humanitarian service, to recognize
the needs of people who are hungry and poor, and to
provide assistance and compassion for those in need;
(B) to increase awareness of the importance of public
service; and
(C) to provide training and development opportunities
for such leaders through placement in programs operated
by appropriate organizations or entities.
(2) AUTHORITY.—The program is authorized to develop such
fellowships to carry out the purposes of this section, including
the fellowships described in paragraph (3).
(3) FELLOWSHIPS.—
(A) IN GENERAL.—The program shall establish and
carry out the Bill Emerson Hunger Fellowship and the
Mickey Leland Hunger Fellowship.
(B) CURRICULUM.—
(i) IN GENERAL.—The fellowships established under
subparagraph (A) shall provide experience and training
to develop the skills and understanding necessary to
improve the humanitarian conditions and the lives of
individuals who suffer from hunger, including—
(I) training in direct service to the hungry
in conjunction with community-based organizations through a program of field placement; and
(II) experience in policy development through
placement in a governmental entity or nonprofit
organization.

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PUBLIC LAW 107–171—MAY 13, 2002
(ii) FOCUS OF BILL EMERSON HUNGER FELLOWSHIP.—The Bill Emerson Hunger Fellowship shall
address hunger and other humanitarian needs in the
United States.
(iii) FOCUS OF MICKEY LELAND HUNGER FELLOWSHIP.—The Mickey Leland Hunger Fellowship shall
address international hunger and other humanitarian
needs.
(iv) WORKPLAN.—To carry out clause (i) and to
assist in the evaluation of the fellowships under paragraph (4), the program shall, for each fellow, approve
a work plan that identifies the target objectives for
the fellow in the fellowship, including specific duties
and responsibilities related to those objectives.
(C) PERIOD OF FELLOWSHIP.—
(i) EMERSON FELLOW.—A Bill Emerson Hunger
Fellowship awarded under this paragraph shall be for
no more than 1 year.
(ii) LELAND FELLOW.—A Mickey Leland Hunger
Fellowship awarded under this paragraph shall be for
no more than 2 years. Not less than 1 year of the
fellowship shall be dedicated to fulfilling the requirement of subparagraph (B)(i)(I).
(D) SELECTION OF FELLOWS.—
(i) IN GENERAL.—A fellowship shall be awarded
pursuant to a nationwide competition established by
the program.
(ii) QUALIFICATION.—A successful applicant shall
be an individual who has demonstrated—
(I) an intent to pursue a career in humanitarian service and outstanding potential for such
a career;
(II) leadership potential or actual leadership
experience;
(III) diverse life experience;
(IV) proficient writing and speaking skills;
(V) an ability to live in poor or diverse communities; and
(VI) such other attributes as determined to
be appropriate by the Board.
(iii) AMOUNT OF AWARD.—
(I) IN GENERAL.—Each individual awarded a
fellowship under this paragraph shall receive a
living allowance and, subject to subclause (II), an
end-of-service award as determined by the program.
(II) REQUIREMENT FOR SUCCESSFUL COMPLETION OF FELLOWSHIP.—Each individual awarded
a fellowship under this paragraph shall be entitled
to receive an end-of-service award at an appropriate rate for each month of satisfactory service
as determined by the Executive Director.
(iv) RECOGNITION OF FELLOWSHIP AWARD.—
(I) EMERSON FELLOW.—An individual awarded
a fellowship from the Bill Emerson Hunger Fellowship shall be known as an ‘‘Emerson Fellow’’.

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(II) LELAND FELLOW.—An individual awarded
a fellowship from the Mickey Leland Hunger
Fellowship shall be known as a ‘‘Leland Fellow’’.
(4) EVALUATION.—The program shall conduct periodic
evaluations of the Bill Emerson and Mickey Leland Hunger
Fellowships. Such evaluations shall include the following:
(A) An assessment of the successful completion of the
work plan of the fellow.
(B) An assessment of the impact of the fellowship
on the fellows.
(C) An assessment of the accomplishment of the purposes of the program.
(D) An assessment of the impact of the fellow on the
community.
(e) TRUST FUND.—
(1) ESTABLISHMENT.—There is established the Congressional Hunger Fellows Trust Fund (hereinafter in this section
referred to as the ‘‘Fund’’) in the Treasury of the United States,
consisting of amounts appropriated to the Fund under subsection (i), amounts credited to it under paragraph (3), and
amounts received under subsection (g)(3)(A).
(2) INVESTMENT OF FUNDS.—The Secretary of the Treasury
shall invest the full amount of the Fund. Each investment
shall be made in an interest bearing obligation of the United
States or an obligation guaranteed as to principal and interest
by the United States that, as determined by the Secretary
in consultation with the Board, has a maturity suitable for
the Fund.
(3) RETURN ON INVESTMENT.—Except as provided in subsection (f)(2), the Secretary of the Treasury shall credit to
the Fund the interest on, and the proceeds from the sale or
redemption of, obligations held in the Fund.
(f) EXPENDITURES; AUDITS.—
(1) IN GENERAL.—The Secretary of the Treasury shall
transfer to the program from the amounts described in subsection (e)(3) and subsection (g)(3)(A) such sums as the Board
determines are necessary to enable the program to carry out
the provisions of this section.
(2) LIMITATION.—The Secretary may not transfer to the
program the amounts appropriated to the Fund under subsection (i).
(3) USE OF FUNDS.—Funds transferred to the program
under paragraph (1) shall be used for the following purposes:
(A) STIPENDS FOR FELLOWS.—To provide for a living
allowance for the fellows.
(B) TRAVEL OF FELLOWS.—To defray the costs of
transportation of the fellows to the fellowship placement
sites.
(C) INSURANCE.—To defray the costs of appropriate
insurance of the fellows, the program, and the Board.
(D) TRAINING OF FELLOWS.—To defray the costs of
preservice and midservice education and training of fellows.
(E) SUPPORT STAFF.—Staff described in subsection (g).
(F) AWARDS.—End-of-service awards under subsection
(d)(3)(D)(iii)(II).

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(G) ADDITIONAL APPROVED USES.—For such other purposes that the Board determines appropriate to carry out
the program.
(4) AUDIT BY GAO.—
(A) IN GENERAL.—The Comptroller General of the
United States shall conduct an annual audit of the accounts
of the program.
(B) BOOKS.—The program shall make available to the
Comptroller General all books, accounts, financial records
(including records of salaries of the Executive Director and
other personnel), reports, files, and all other papers, things,
or property belonging to or in use by the program and
necessary to facilitate such audit.
(C) REPORT TO CONGRESS.—The Comptroller General
shall submit a copy of the results of each such audit to
the appropriate congressional committees.
(g) STAFF; POWERS OF PROGRAM.—
(1) EXECUTIVE DIRECTOR.—
(A) IN GENERAL.—The Board shall appoint an Executive Director of the program who shall administer the
program. The Executive Director shall carry out such other
functions consistent with the provisions of this section as
the Board shall prescribe.
(B) RESTRICTION.—The Executive Director may not
serve as Chairperson of the Board.
(C) COMPENSATION.—The Executive Director shall be
paid at a rate not to exceed the rate of basic pay payable
for level V of the Executive Schedule under section 5316
of title 5, United States Code.
(2) STAFF.—
(A) IN GENERAL.—With the approval of a majority of
the Board, the Executive Director may appoint and fix
the pay of additional personnel as the Executive Director
considers necessary and appropriate to carry out the functions of the provisions of this section.
(B) COMPENSATION.—An individual appointed under
subparagraph (A) shall be paid at a rate not to exceed
the rate of basic pay payable for level GS–15 of the General
Schedule.
(3) POWERS.—In order to carry out the provisions of this
section, the program may perform the following functions:
(A) GIFTS.—The program may solicit, accept, use, and
dispose of gifts, bequests, or devises of services or property,
both real and personal, for the purpose of aiding or facilitating the work of the program. Gifts, bequests, or devises
of money and proceeds from sales of other property received
as gifts, bequests, or devises shall be deposited in the
Fund and shall be available for disbursement upon order
of the Board.
(B) EXPERTS AND CONSULTANTS.—The program may
procure temporary and intermittent services under section
3109 of title 5, United States Code, but at rates for individuals not to exceed the daily equivalent of the maximum
annual rate of basic pay payable for GS–15 of the General
Schedule.
(C) CONTRACT AUTHORITY.—The program may contract,
with the approval of a majority of the members of the

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Board, with and compensate Government and private agencies or persons without regard to section 3709 of the
Revised Statutes (41 U.S.C. 5).
(D) OTHER NECESSARY EXPENDITURES.—The program
shall make such other expenditures which the program
considers necessary to carry out the provisions of this section, but excluding project development.
(h) REPORT.—Not later than December 31 of each year, the
Board shall submit to the appropriate congressional committees
a report on the activities of the program carried out during the
previous fiscal year, and shall include the following:
(1) An analysis of the evaluations conducted under subsection (d)(4) (relating to evaluations of the Emerson and
Leland fellowships and accomplishment of the program purposes) during that fiscal year.
(2) A statement of the total amount of funds attributable
to gifts received by the program in that fiscal year (as authorized under subsection (g)(3)(A)), and the total amount of such
funds that were expended to carry out the program that fiscal
year.
(i) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated $18,000,000 to carry out the provisions of this
section.
(j) DEFINITION.—In this section, the term ‘‘appropriate congressional committees’’ means—
(1) the Committee on Agriculture and the Committee on
International Relations of the House of Representatives; and
(2) the Committee on Agriculture, Nutrition, and Forestry
and the Committee on Foreign Relations of the Senate.
SEC. 4405. GENERAL EFFECTIVE DATE.

Deadline.

2 USC 1161 note.

Except as otherwise provided in this title, the amendments
made by this title take effect on October 1, 2002.

TITLE V—CREDIT
Subtitle A—Farm Ownership Loans
SEC. 5001. DIRECT LOANS.

Section 302(b)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1922(b)(1)) is amended by striking ‘‘operated’’
and inserting ‘‘participated in the business operations of’’.
SEC. 5002. FINANCING OF BRIDGE LOANS.

Section 303(a)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1923(a)(1)) is amended—
(1) in subparagraph (C), by striking ‘‘or’’ at the end;
(2) in subparagraph (D), by striking the period at the
end and inserting ‘‘; or’’; and
(3) by adding at the end the following:
‘‘(E) refinancing a temporary bridge loan made by a
commercial or cooperative lender to a farmer or rancher
for the acquisition of land for a farm or ranch, if—
‘‘(i) the Secretary approved an application for a
direct farm ownership loan to the farmer or rancher
for acquisition of the land; and

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‘‘(ii) funds for direct farm ownership loans under
section 346(b) were not available at the time at which
the application was approved.’’.

SEC. 5003. AMOUNT OF GUARANTEE OF LOANS FOR FARM OPERATIONS
ON TRIBAL LANDS.

Section 309(h) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1929(h)) is amended—
(1) in paragraph (4), by striking ‘‘paragraphs (5) and (6)’’
and inserting ‘‘paragraphs (5), (6), and (7)’’; and
(2) by adding at the end the following:
‘‘(7) AMOUNT OF GUARANTEE OF LOANS FOR FARM OPERATIONS ON TRIBAL LANDS.—In the case of an operating loan
made to a farmer or rancher whose farm or ranch land is
subject to the jurisdiction of an Indian tribe and whose loan
is secured by 1 or more security instruments that are subject
to the jurisdiction of an Indian tribe, the Secretary shall guarantee 95 percent of the loan.’’.
SEC. 5004. GUARANTEE OF LOANS MADE UNDER STATE BEGINNING
FARMER OR RANCHER PROGRAMS.

Section 309 of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1929) is amended by adding at the end the following:
‘‘(j) GUARANTEE OF LOANS MADE UNDER STATE BEGINNING
FARMER OR RANCHER PROGRAMS.—The Secretary may guarantee
under this title a loan made under a State beginning farmer or
rancher program, including a loan financed by the net proceeds
of a qualified small issue agricultural bond for land or property
described in section 144(a)(12)(B)(ii) of the Internal Revenue Code
of 1986.’’.
SEC. 5005. DOWN PAYMENT LOAN PROGRAM.

Section 310E of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1935) is amended—
(1) in subsection (b)—
(A) in paragraph (1), by striking ‘‘30 percent’’ and
inserting ‘‘40 percent’’; and
(B) in paragraph (3), by striking ‘‘10 years’’ and
inserting ‘‘15 years’’; and
(2) in subsection (c)(3)(B), by striking ‘‘10-year’’ and
inserting ‘‘15-year’’.
SEC. 5006. BEGINNING FARMER AND RANCHER CONTRACT LAND SALES
PROGRAM.

Subtitle A of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1922 et seq.) is amended by adding at the end
the following:
7 USC 1936.

‘‘SEC. 310F. BEGINNING FARMER AND RANCHER CONTRACT LAND
SALES PROGRAM.

‘‘(a) IN GENERAL.—If the Secretary makes a determination that
the risk is comparable under subsection (b), the Secretary shall
carry out a pilot program in not fewer than 5 States, as determined
by the Secretary, to guarantee up to 5 loans per State in each
of fiscal years 2003 through 2007 made by a private seller of
a farm or ranch to a qualified beginning farmer or rancher on
a contract land sale basis, if the loan meets applicable underwriting

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criteria and a commercial lending institution agrees to serve as
escrow agent.
‘‘(b) DATE OF COMMENCEMENT OF PROGRAM.—Not later than
October 1, 2002, the Secretary shall make a determination on
whether guarantees of contract land sales present a risk that is
comparable with the risk presented in the case of guarantees to
commercial lenders.’’.

Deadline.

Subtitle B—Operating Loans
SEC. 5101. DIRECT LOANS.

Section 311(c) of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1941(c)) is amended—
(1) in paragraph (1)—
(A) in the matter that precedes subparagraph (A), by
striking ‘‘paragraph (3)’’ and inserting ‘‘paragraphs (3) and
(4)’’; and
(B) in subparagraph (A), by striking ‘‘who has not’’
and all that follows through ‘‘5 years’’; and
(2) by adding at the end the following:
‘‘(4) WAIVERS.—
‘‘(A) FARM AND RANCH OPERATIONS ON TRIBAL LANDS.—
The Secretary shall waive the limitation under paragraph
(1)(C) or (3) for a direct loan made under this subtitle
to a farmer or rancher whose farm or ranch land is subject
to the jurisdiction of an Indian tribe and whose loan is
secured by 1 or more security instruments that are subject
to the jurisdiction of an Indian tribe if the Secretary determines that commercial credit is not generally available
for such farm or ranch operations.
‘‘(B) OTHER FARM AND RANCH OPERATIONS.—On a caseby-case determination not subject to administrative appeal,
the Secretary may grant a borrower a waiver, 1 time only
for a period of 2 years, of the limitation under paragraph
(1)(C) or (3) for a direct operating loan if the borrower
demonstrates to the satisfaction of the Secretary that—
‘‘(i) the borrower has a viable farm or ranch operation;
‘‘(ii) the borrower applied for commercial credit
from at least 2 commercial lenders;
‘‘(iii) the borrower was unable to obtain a commercial loan (including a loan guaranteed by the Secretary); and
‘‘(iv) the borrower successfully has completed, or
will complete within 1 year, borrower training under
section 359 (from which requirement the Secretary
shall not grant a waiver under section 359(f)).’’.

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SEC. 5102. SUSPENSION OF LIMITATION ON PERIOD FOR WHICH BORROWERS ARE ELIGIBLE FOR GUARANTEED ASSISTANCE.

7 USC 1949 note.

During the period beginning January 1, 2002, and ending
December 31, 2006, section 319(b) of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1949(b)) shall have no force or
effect.

Effective date.
Termination
date.

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Subtitle C—Emergency Loans
SEC. 5201. EMERGENCY LOANS IN RESPONSE TO AN EMERGENCY
RESULTING FROM QUARANTINES.

(a) LOAN AUTHORITY.—Section 321(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1961(a)) is amended—
(1) in each of the 1st and 3rd sentences, by striking ‘‘a
natural disaster in the United States or by’’ and inserting
‘‘a quarantine imposed by the Secretary under the Plant Protection Act or the animal quarantine laws (as defined in section
2509 of the Food, Agriculture, Conservation, and Trade Act
of 1990), a natural disaster in the United States, or’’; and
(2) in the 4th sentence—
(A) by striking ‘‘a natural disaster’’ and inserting ‘‘such
a quarantine or natural disaster’’; and
(B) by striking ‘‘by such natural disaster’’ and inserting
‘‘by such quarantine or natural disaster’’.
(b) CONFORMING AMENDMENT.—Section 323 of such Act (7
U.S.C. 1963) is amended by inserting ‘‘quarantine,’’ before ‘‘natural
disaster’’.

Subtitle D—Administrative Provisions
7 USC 1922 note.

SEC. 5301. EVALUATIONS OF DIRECT AND GUARANTEED LOAN PROGRAMS.

(a) STUDIES.—The Secretary of Agriculture shall conduct 2
studies of the direct and guaranteed loan progams under sections
302 and 311 of the Consolidated Farm and Rural Development
Act, each of which shall include an examination of the number,
average principal amount, and delinquency and default rates of
loans provided or guaranteed during the period covered by the
study.
(b) PERIODS COVERED.—
(1) FIRST STUDY.—One study under subsection (a) shall
cover the 1-year period that begins 1 year after the date of
the enactment of this section.
(2) SECOND STUDY.—One study under subsection (a) shall
cover the 1-year period that begins 3 years after such date
of enactment.
(c) REPORTS TO THE CONGRESS.—At the end of the period covered by each study under this section, the Secretary of Agriculture
shall submit to the Congress a report that contains an evaluation
of the results of the study, including an analysis of the effectiveness
of loan programs referred to in subsection (a) in meeting the credit
needs of agricultural producers in an efficient and fiscally responsible manner.
SEC. 5302. ELIGIBILITY OF TRUSTS AND LIMITED LIABILITY COMPANIES FOR FARM OWNERSHIP LOANS, FARM OPERATING
LOANS, AND EMERGENCY LOANS.

(a) IN GENERAL.—Sections 302(a), 311(a), and 321(a) of the
Consolidated Farm and Rural Development Act (7 U.S.C. 1922(a),
1941(a), and 1961(a)) are each amended by striking ‘‘and joint
operations’’ each place it appears and inserting ‘‘joint operations,
trusts, and limited liability companies’’.

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(b) CONFORMING AMENDMENT.—Section 321(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961(a)) is
amended by striking ‘‘or joint operations’’ each place it appears
and inserting ‘‘joint operations, trusts, or limited liability companies’’.
SEC. 5303. DEBT SETTLEMENT.

Section 331(b)(4) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1981(b)(4)) is amended—
(1) by striking ‘‘The Secretary may release’’ and inserting
‘‘After consultation with a local or area county committee, the
Secretary may release’’; and
(2) by striking ‘‘carried out—’’ and all that follows through
‘‘(B) after’’ and inserting ‘‘carried out after’’.
SEC. 5304. TEMPORARY AUTHORITY TO ENTER INTO CONTRACTS; PRIVATE COLLECTION AGENCIES.

(a) IN GENERAL.—Section 331 of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1981) is amended by striking
subsections (d) and (e).
(b) APPLICATION.—The amendment made by subsection (a) shall
not apply to a contract entered into before the effective date of
this Act.

7 USC 1981 note.

SEC. 5305. INTEREST RATE OPTIONS FOR LOANS IN SERVICING.

Section 331B of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1981b) is amended—
(1) by striking ‘‘lower of (1) the’’ and inserting the following:
‘‘lowest of—
‘‘(1) the’’; and
(2) by striking ‘‘original loan or (2) the’’ and inserting
the following: ‘‘original loan;
‘‘(2) the rate being charged by the Secretary for loans,
other than guaranteed loans, of the same type at the time
at which the borrower applies for a deferral, consolidation,
rescheduling, or reamortization; or
‘‘(3) the’’.
SEC.

5306.

ELIMINATION OF REQUIREMENT THAT SECRETARY
REQUIRE COUNTY COMMITTEES TO CERTIFY IN WRITING
THAT CERTAIN LOAN REVIEWS HAVE BEEN CONDUCTED.

Section 333(2) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1983(2)) is amended to read as follows:
‘‘(2) except with respect to a loan under section 306, 310B,
or 314—
‘‘(A) an annual review of the credit history and business
operation of the borrower; and
‘‘(B) an annual review of the continued eligibility of
the borrower for the loan;’’.
SEC. 5307. SIMPLIFIED LOAN GUARANTEE APPLICATION AVAILABLE
FOR LOANS OF GREATER AMOUNTS.

Section 333A(g)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1983a(g)(1)) is amended by striking ‘‘$50,000’’
and inserting ‘‘$125,000’’.
SEC. 5308. INVENTORY PROPERTY.

Section 335(c) of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1985(c)) is amended—

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PUBLIC LAW 107–171—MAY 13, 2002
(1) in paragraph (1)—
(A) in subparagraph (B)—
(i) in clause (i), by striking ‘‘75 days’’ and inserting
‘‘135 days’’; and
(ii) by adding at the end the following:
‘‘(iv) COMBINING AND DIVIDING OF PROPERTY.—To
the maximum extent practicable, the Secretary shall
maximize the opportunity for beginning farmers and
ranchers to purchase real property acquired by the
Secretary under this title by combining or dividing
inventory parcels of the property in such manner as
the Secretary determines to be appropriate.’’; and
(B) in subparagraph (C)—
(i) by striking ‘‘75 days’’ and inserting ‘‘135 days’’;
and
(ii) by striking ‘‘75-day period’’ and inserting ‘‘135day period’’; and
(2) by striking paragraph (2) and inserting the following:
‘‘(2) PREVIOUS LEASE.—In the case of real property acquired
before April 4, 1996, that the Secretary leased before April
4, 1996, not later than 60 days after the lease expires, the
Secretary shall offer to sell the property in accordance with
paragraph (1).’’.

Deadline.

SEC. 5309. ADMINISTRATION OF CERTIFIED LENDERS AND PREFERRED
CERTIFIED LENDERS PROGRAMS.

Section 339 of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1989) is amended by adding at the end the following:
‘‘(e) ADMINISTRATION OF CERTIFIED LENDERS AND PREFERRED
CERTIFIED LENDERS PROGRAMS.—The Secretary may administer the
loan guarantee programs under subsections (c) and (d) through
central offices established in States or in multi-State areas.’’.
SEC. 5310. DEFINITIONS.

(a) QUALIFIED BEGINNING FARMER OR RANCHER.—Section
343(a)(11)(F) of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1991(a)(11)(F)) is amended by striking ‘‘25 percent’’
and inserting ‘‘30 percent’’.
(b) DEBT FORGIVENESS.—Section 343(a)(12)(B) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1991(a)(12)(B))
is amended to read as follows:
‘‘(B) EXCEPTIONS.—The term ‘debt forgiveness’ does not
include—
‘‘(i) consolidation, rescheduling, reamortization, or
deferral of a loan; or
‘‘(ii) any write-down provided as part of a resolution of a discrimination complaint against the Secretary.’’.
SEC. 5311. LOAN AUTHORIZATION LEVELS.

Section 346(b)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1994(b)(1)) is amended to read as follows:
‘‘(1) IN GENERAL.—The Secretary may make or guarantee
loans under subtitles A and B from the Agricultural Credit
Insurance Fund provided for in section 309 for not more than
$3,796,000,000 for each of fiscal years 2003 through 2007,
of which, for each fiscal year—
‘‘(A) $770,000,000 shall be for direct loans, of which—

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‘‘(i) $205,000,000 shall be for farm ownership loans
under subtitle A; and
‘‘(ii) $565,000,000 shall be for operating loans
under subtitle B; and
‘‘(B) $3,026,000,000 shall be for guaranteed loans, of
which—
‘‘(i) $1,000,000,000 shall be for guarantees of farm
ownership loans under subtitle A; and
‘‘(ii) $2,026,000,000 shall be for guarantees of operating loans under subtitle B.’’.
SEC. 5312. RESERVATION OF FUNDS FOR DIRECT OPERATING LOANS
FOR BEGINNING FARMERS AND RANCHERS.

Section 346(b)(2)(A)(ii)(III) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1994(b)(2)(A)(ii)(III)) is amended by
striking ‘‘2000 through 2002’’ and inserting ‘‘2003 through 2007’’.
SEC. 5313. INTEREST RATE REDUCTION PROGRAM.

Section 351 of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1999) is amended—
(1) in subsection (a)—
(A) by striking ‘‘PROGRAM.—’’ and all that follows
through ‘‘The Secretary’’ and inserting ‘‘PROGRAM.—The
Secretary’’; and
(B) by striking paragraph (2); and
(2) in subsection (e), by striking paragraph (2) and inserting
the following:
‘‘(2) MAXIMUM AMOUNT OF FUNDS.—
‘‘(A) IN GENERAL.—The total amount of funds used
by the Secretary to carry out this section for a fiscal year
shall not exceed $750,000,000.
‘‘(B) BEGINNING FARMERS AND RANCHERS.—
‘‘(i) IN GENERAL.—The Secretary shall reserve not
less than 15 percent of the funds used by the Secretary
under subparagraph (A) to make payments for guaranteed loans made to beginning farmers and ranchers.
‘‘(ii) DURATION OF RESERVATION OF FUNDS.—Funds
reserved for beginning farmers or ranchers under
clause (i) for a fiscal year shall be reserved only until
March 1 of the fiscal year.’’.
SEC. 5314. REAMORTIZATION OF RECAPTURE PAYMENTS.

Section 353(e)(7) of the Consolidated Farm and Rural Development Act (7 U.S.C. 2001(e)(7)) is amended by adding at the end
the following:
‘‘(D) REAMORTIZATION.—
‘‘(i) IN GENERAL.—The Secretary may modify the
amortization of a recapture payment referred to in
subparagraph (A) of this paragraph on which a payment has become delinquent by using loan service
tools under section 343(b)(3) if—
‘‘(I) the default is due to circumstances beyond
the control of the borrower; and
‘‘(II) the borrower acted in good faith (as determined by the Secretary) in attempting to repay
the recapture amount.
‘‘(ii) LIMITATIONS.—

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(I) TERM OF REAMORTIZATION.—The term of
a reamortization under this subparagraph may not
exceed 25 years from the date of the original
amortization agreement.
‘‘(II) NO REDUCTION OR PRINCIPAL OR UNPAID
INTEREST DUE.—A reamortization of a recapture
payment under this subparagraph may not provide
for reducing the outstanding principal or unpaid
interest due on the recapture payment.

SEC. 5315. ALLOCATION OF CERTAIN FUNDS FOR SOCIALLY DISADVANTAGED FARMERS AND RANCHERS.

The last sentence of section 355(c)(2) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 2003(c)(2)) is amended to
read as follows: ‘‘Any funds reserved and allocated under this paragraph but not used within a State shall, to the extent necessary
to satisfy pending applications under this title, be available for
use by socially disadvantaged farmers and ranchers in other States,
as determined by the Secretary, and any remaining funds shall
be reallocated within the State.’’.
SEC.

5316.

WAIVER OF BORROWER
REQUIREMENT.

TRAINING

CERTIFICATION

Section 359 of the Consolidated Farm and Rural Development
Act (7 U.S.C. 2006a) is amended by striking subsection (f) and
inserting the following:
‘‘(f) WAIVERS.—
‘‘(1) IN GENERAL.—The Secretary may waive the requirements of this section for an individual borrower if the Secretary
determines that the borrower demonstrates adequate knowledge in areas described in this section.
‘‘(2) CRITERIA.—The Secretary shall establish criteria providing for the application of paragraph (1) consistently in all
counties nationwide.’’.
SEC. 5317. TIMING OF LOAN ASSESSMENTS.

Section 360(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 2006b(a)) is amended by striking ‘‘After an
applicant is determined eligible for assistance under this title by
the appropriate county committee established pursuant to section
332, the’’ and inserting ‘‘The’’.
SEC. 5318. ANNUAL REVIEW OF BORROWERS.

Section 360(d)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 2006b(d)(1)) is amended by striking ‘‘biannual’’
and inserting ‘‘annual’’.
SEC. 5319. LOAN ELIGIBILITY FOR BORROWERS WITH PRIOR DEBT
FORGIVENESS.

Section 373(b)(2)(A) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 2008h(b)(2)(A)) is amended—
(1) in clause (i), by striking ‘‘or’’;
(2) in clause (ii), by striking the period and inserting ‘‘;
or’’; and
(3) by adding at the end the following:
‘‘(iii) received debt forgiveness on not more than
1 occasion resulting directly and primarily from a

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major disaster or emergency designated by the President on or after April 4, 1996, under the Robert T.
Stafford Disaster Relief and Emergency Assistance Act
(42 U.S.C. 5121 et seq.).’’.
SEC. 5320. MAKING AND SERVICING OF LOANS BY PERSONNEL OF
STATE, COUNTY, OR AREA COMMITTEES.

Subtitle D of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1981–2008j) is amended by adding at the end the
following:
‘‘SEC. 376. MAKING AND SERVICING OF LOANS BY PERSONNEL OF
STATE, COUNTY, OR AREA COMMITTEES.

7 USC 2008k.

‘‘The Secretary shall use personnel of a State, county or area
committee established under section 8(b)(5) of the Soil Conservation
and Domestic Allotment Act (16 U.S.C 590h(b)(5)) to make and
service loans under this title to the extent the personnel have
been trained to do so.’’.
SEC. 5321. ELIGIBILITY OF EMPLOYEES OF STATE, COUNTY, OR AREA
COMMITTEE FOR LOANS AND LOAN GUARANTEES.

Subtitle D of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1981–2008j) is further amended by adding at the
end the following:
‘‘SEC. 377. ELIGIBILITY OF EMPLOYEES OF STATE, COUNTY, OR AREA
COMMITTEE FOR LOANS AND LOAN GUARANTEES.

7 USC 2008l.

‘‘(a) IN GENERAL.—The Secretary shall not prohibit an employee
of a State, county or area committee established under section
8(b)(5) of the Soil Conservation and Domestic Allotment Act (16
U.S.C. 590h(b)(5)) or an employee of the Department of Agriculture
from obtaining a loan or loan guarantee under subtitle A, B or
C of this title.
‘‘(b) APPROVALS.—
‘‘(1) COUNTY OR AREA OFFICE.—In the case of a loan application from an employee in a county or area office, the Farm
Service Agency State office shall be responsible for reviewing
and approving the application.
‘‘(2) STATE OFFICE.—In the case of a loan application from
an employee of a State office, the Farm Service Agency national
office shall be responsible for reviewing and approving the
application.’’.

Subtitle E—Farm Credit
SEC. 5401. REPEAL OF BURDENSOME APPROVAL REQUIREMENTS.

(a) BANKS FOR COOPERATIVES.—Section 3.1(11)(B) of the Farm
Credit Act of 1971 (12 U.S.C. 2122(11)(B)) is amended—
(1) by striking clause (iii); and
(2) by redesignating clause (iv) as clause (iii).
(b) OTHER SYSTEM BANKS; ASSOCIATIONS.—Section 4.18A of
the Farm Credit Act of 1971 (12 U.S.C. 2206a) is amended—
(1) in subsection (a)(1), by striking ‘‘3.1(11)(B)(iv)’’ and
inserting ‘‘3.1(11)(B)(iii)’’; and
(2) by striking subsection (c).

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SEC. 5402. BANKS FOR COOPERATIVES.

Section 3.7(b) of the Farm Credit Act of 1971 (12 U.S.C. 2128(b))
is amended—
(1) in paragraphs (1) and (2)(A)(i), by striking ‘‘farm supplies’’ each place it appears and inserting ‘‘agricultural supplies’’; and
(2) by adding at the end the following:
‘‘(4) DEFINITION OF AGRICULTURAL SUPPLY.—In this subsection, the term ‘agricultural supply’ includes—
‘‘(A) a farm supply; and
‘‘(B)(i) agriculture-related processing equipment;
‘‘(ii) agriculture-related machinery; and
‘‘(iii) other capital goods related to the storage or handling of agricultural commodities or products.’’.
SEC. 5403. INSURANCE CORPORATION PREMIUMS.

(a) REDUCTION IN PREMIUMS FOR GSE-GUARANTEED LOANS.—
(1) IN GENERAL.—Section 5.55 of the Farm Credit Act of
1971 (12 U.S.C. 2277a–4) is amended—
(A) in subsection (a)—
(i) in paragraph (1)—
(I) in subparagraph (A), by striking ‘‘government-guaranteed loans provided for in subparagraph (C)’’ and inserting ‘‘loans provided for in
subparagraphs (C) and (D)’’;
(II) in subparagraph (B), by striking ‘‘and’’
at the end;
(III) in subparagraph (C), by striking the
period at the end and inserting ‘‘; and’’; and
(IV) by adding at the end the following:
‘‘(D) the annual average principal outstanding for such
year on the guaranteed portions of Government Sponsored
Enterprise-guaranteed loans made by the bank that are
in accrual status, multiplied by a factor, not to exceed
0.0015, determined by the Corporation at the sole discretion
of the Corporation.’’; and
(ii) by adding at the end the following:
‘‘(4) DEFINITION OF GOVERNMENT SPONSORED ENTERPRISEGUARANTEED LOAN.—In this section and sections 1.12(b) and
5.56(a), the term ‘Government Sponsored Enterprise-guaranteed loan’ means a loan or credit, or portion of a loan or
credit, that is guaranteed by an entity that is chartered by
Congress to serve a public purpose and the debt obligations
of which are not explicitly guaranteed by the United States,
including the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, the Federal Home Loan
Bank System, and the Federal Agricultural Mortgage Corporation, but not including any other institution of the Farm Credit
System.’’; and
(B) in subsection (e)(4)(B), by striking ‘‘governmentguaranteed loans described in subsection (a)(1)(C)’’ and
inserting ‘‘loans described in subparagraph (C) or (D) of
subsection (a)(1)’’.
(2) CONFORMING AMENDMENTS.—
(A) Section 1.12(b) of the Farm Credit Act of 1971
(12 U.S.C. 2020(b)) is amended—

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(i) in paragraph (1), by inserting ‘‘and Government
Sponsored Enterprise-guaranteed loans (as defined in
section 5.55(a)(4)) provided for in paragraph (4)’’ after
‘‘government-guaranteed loans (as defined in section
5.55(a)(3)) provided for in paragraph (3)’’;
(ii) in paragraph (2), by striking ‘‘and’’ at the end;
(iii) in paragraph (3), by striking the period at
the end and inserting ‘‘; and’’; and
(iv) by adding at the end the following:
‘‘(4) the annual average principal outstanding for such year
on the guaranteed portions of Government Sponsored Enterprise-guaranteed loans (as so defined) made by the association,
or by the other financing institution and funded by or discounted with the Farm Credit Bank, that are in accrual status,
multiplied by a factor, not to exceed 0.0015, determined by
the Corporation for the purpose of setting the premium for
such guaranteed portions of loans under section 5.55(a)(1)(D).’’.
(B) Section 5.56(a) of the Farm Credit Act of 1971
(12 U.S.C. 2277a–5(a)) is amended—
(i) in paragraph (1), by inserting ‘‘and Government
Sponsored Enterprise-guaranteed loans (as defined in
section 5.55(a)(4))’’ after ‘‘government-guaranteed
loans’’;
(ii) by redesignating paragraphs (4) and (5) as
paragraphs (5) and (6), respectively; and
(iii) by inserting after paragraph (3) the following:
‘‘(4) the annual average principal outstanding on the
guaranteed portions of Government Sponsored Enterpriseguaranteed loans (as defined in section 5.55(a)(4)) that are
in accrual status;’’.
(b) APPLICABILITY.—The amendments made by this section shall
apply with respect to determinations of premiums for calendar
year 2002 and for any succeeding calendar year, and to certified
statements with respect to such premiums.

12 USC 2020
note.

Subtitle F—General Provisions
SEC. 5501. TECHNICAL AMENDMENTS.

(a) Section 321(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961(a)) is amended by striking ‘‘Disaster Relief
and Emergency Assistance Act’’ each place it appears and inserting
‘‘Robert T. Stafford Disaster Relief and Emergency Assistance Act
(42 U.S.C. 5121 et seq.)’’.
(b) Section 336(b) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1986(b)) is amended in the second sentence
by striking ‘‘provided for in section 332 of this title’’.
(c) Section 359(c)(1) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 2006a(c)(1)) is amended by striking
‘‘established pursuant to section 332,’’.

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PUBLIC LAW 107–171—MAY 13, 2002

TITLE VI—RURAL DEVELOPMENT
Subtitle A—Consolidated Farm and Rural
Development Act
SEC. 6001. ELIGIBILITY OF RURAL EMPOWERMENT ZONES AND RURAL
ENTERPRISE COMMUNITIES FOR DIRECT AND GUARANTEED LOANS FOR ESSENTIAL COMMUNITY FACILITIES.

Section 306(a)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)(1)) is amended by inserting after the
first sentence the following: ‘‘The Secretary may also make or
insure loans to communities that have been designated as rural
empowerment zones or rural enterprise communities pursuant to
part I of subchapter U of chapter 1 of the Internal Revenue Code
of 1986, or as rural enterprise communities pursuant to section
766 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 1999 (Public Law
105–277; 112 Stat. 2681, 2681–37), to provide for the installation
or improvement of essential community facilities including necessary related equipment, and to furnish financial assistance or
other aid in planning projects for such purposes.’’.
SEC. 6002. WATER OR WASTE DISPOSAL GRANTS.

Section 306(a)(2) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)(2)) is amended—
(1) by striking ‘‘(2) The’’ and inserting the following:
‘‘(2) WATER, WASTE DISPOSAL, AND WASTEWATER FACILITY
GRANTS.—
‘‘(A) AUTHORITY.—
‘‘(i) IN GENERAL.—The’’;
(2) by striking ‘‘aggregating not to exceed $590,000,000
in any fiscal year’’;
(3) by striking ‘‘The amount’’ and inserting the following:
‘‘(ii) AMOUNT.—The amount’’;
(4) by striking ‘‘paragraph’’ and inserting ‘‘subparagraph’’;
(5) by striking ‘‘The Secretary shall’’ and inserting the
following:
‘‘(iii) GRANT RATE.—The Secretary shall’’; and
(6) by adding at the end the following:
‘‘(B) REVOLVING FUNDS FOR FINANCING WATER AND
WASTEWATER PROJECTS.—
‘‘(i) IN GENERAL.—The Secretary may make grants
to qualified private, nonprofit entities to capitalize
revolving funds for the purpose of providing financing
to eligible entities for—
‘‘(I) predevelopment costs associated with proposed water and wastewater projects or with
existing water and wastewater systems; and
‘‘(II) short-term costs incurred for replacement
equipment, small-scale extension services, or other
small capital projects that are not part of the
regular operations and maintenance activities of
existing water and wastewater systems.
‘‘(ii) ELIGIBLE ENTITIES.—To be eligible to obtain
financing from a revolving fund under clause (i), an

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eligible entity must be eligible to obtain a loan, loan
guarantee, or grant under paragraph (1) or this paragraph.
‘‘(iii) MAXIMUM AMOUNT OF FINANCING.—The
amount of financing made to an eligible entity under
this subparagraph shall not exceed—
‘‘(I) $100,000 for costs described in clause (i)(I);
and
‘‘(II) $100,000 for costs described in clause
(i)(II).
‘‘(iv) TERM.—The term of financing provided to
an eligible entity under this subparagraph shall not
exceed 10 years.
‘‘(v) ADMINISTRATION.—The Secretary shall limit
the amount of grant funds that may be used by a
grant recipient for administrative costs incurred under
this subparagraph.
‘‘(vi) ANNUAL REPORT.—A nonprofit entity receiving
a grant under this subparagraph shall submit to the
Secretary an annual report that describes the number
and size of communities served and the type of
financing provided.
‘‘(vii) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated to carry out this
subparagraph $30,000,000 for each of fiscal years 2002
through 2007.’’.
SEC. 6003. RURAL BUSINESS OPPORTUNITY GRANTS.

Section 306(a)(11)(D) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1926(a)(11)(D)) is amended—
(1) by striking ‘‘$7,500,000’’ and inserting ‘‘$15,000,000’’;
and
(2) by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 6004. CHILD DAY CARE FACILITIES.

Section 306(a)(19) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)(19)) is amended by adding at the end
the following:
‘‘(C) RESERVATION OF FUNDS FOR CHILD DAY CARE
FACILITIES.—
‘‘(i) IN GENERAL.—For each fiscal year, not less
than 10 percent of the funds made available to carry
out this paragraph shall be reserved for grants to
pay the Federal share of the cost of developing and
constructing day care facilities for children in rural
areas.
‘‘(ii) RELEASE.—Funds reserved under clause (i)
for a fiscal year shall be reserved only until April
1 of the fiscal year.’’.
SEC. 6005. RURAL WATER AND WASTEWATER CIRCUIT RIDER PROGRAM.

Section 306(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)) is amended by adding at the end
the following:
‘‘(22) RURAL WATER AND WASTEWATER CIRCUIT RIDER PROGRAM.—

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(A) IN GENERAL.—The Secretary shall establish a
national rural water and wastewater circuit rider program
that is based on the rural water circuit rider program
of the National Rural Water Association that (as of the
date of enactment of this paragraph) receives funding from
the Secretary, acting through the Rural Utilities Service.
‘‘(B) RELATIONSHIP TO EXISTING PROGRAM.—The program established under subparagraph (A) shall not affect
the authority of the Secretary to carry out the circuit
rider program for which funds are made available under
the heading ‘‘RURAL COMMUNITY ADVANCEMENT PROGRAM’’
in title III of the Agriculture, Rural Development, Food
and Drug Administration, and Related Agencies Appropriations Act, 2002 (115 Stat. 719).
‘‘(C) AUTHORIZATION OF APPROPRIATIONS.—There is
authorized to be appropriated to carry out this paragraph
$15,000,000 for fiscal year 2003 and each fiscal year thereafter.’’.

SEC. 6006. MULTIJURISDICTIONAL REGIONAL PLANNING ORGANIZATIONS.

Section 306(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)) (as amended by section 6005) is
amended by adding at the end the following:
‘‘(23) MULTIJURISDICTIONAL REGIONAL PLANNING ORGANIZATIONS.—
‘‘(A) GRANTS.—The Secretary shall provide grants to
multijurisdictional regional planning and development
organizations to pay the Federal share of the cost of providing assistance to local governments to improve the infrastructure, services, and business development capabilities
of local governments and local economic development
organizations.
‘‘(B) PRIORITY.—In determining which organizations
will receive a grant under this paragraph, the Secretary
shall give priority to an organization that—
‘‘(i) serves a rural area that, during the most recent
5-year period—
‘‘(I) had a net out-migration of inhabitants,
or other population loss, from the rural area that
equals or exceeds 5 percent of the population of
the rural area; or
‘‘(II) had a median household income that is
less than the nonmetropolitan median household
income of the applicable State; and
‘‘(ii) has a history of providing substantive assistance to local governments and economic development
organizations.
‘‘(C) FEDERAL SHARE.—A grant provided under this
paragraph shall be for not more than 75 percent of the
cost of providing assistance described in subparagraph (A).
‘‘(D) MAXIMUM AMOUNT OF GRANTS.—The amount of
a grant provided to an organization under this paragraph
shall not exceed $100,000.
‘‘(E) AUTHORIZATION OF APPROPRIATIONS.—There is
authorized to be appropriated to carry out this paragraph
$30,000,000 for each of fiscal years 2003 through 2007.’’.

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116 STAT. 355

SEC. 6007. LOAN GUARANTEES FOR CERTAIN RURAL DEVELOPMENT
LOANS.

(a) LOAN GUARANTEES FOR WATER, WASTEWATER, AND ESSENCOMMUNITY FACILITIES LOANS.—Section 306(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1925(a)) (as
amended by section 6006) is amended by adding at the end the
following:
‘‘(24) LOAN GUARANTEES FOR WATER, WASTEWATER, AND
ESSENTIAL COMMUNITY FACILITIES LOANS.—
‘‘(A) IN GENERAL.—The Secretary may guarantee a loan
made to finance a community facility or water or waste
facility project in a rural area, including a loan financed
by the net proceeds of a bond described in section 142(a)
of the Internal Revenue Code of 1986.
‘‘(B) REQUIREMENTS.—To be eligible for a loan guarantee under subparagraph (A), an individual or entity
offering to purchase the loan shall demonstrate to the
Secretary that the person has—
‘‘(i) the capabilities and resources necessary to
service the loan in a manner that ensures the continued performance of the loan, as determined by the
Secretary; and
‘‘(ii) the ability to generate capital to provide borrowers of the loan with the additional credit necessary
to properly service the loan.’’.
(b) LOAN GUARANTEES FOR CERTAIN LOANS.—Section 310B of
the Consolidated Farm and Rural Development Act (7 U.S.C. 1932)
is amended by adding at the end the following:
‘‘(h) LOAN GUARANTEES FOR CERTAIN LOANS.—The Secretary
may guarantee loans made under subsection (a) to finance the
issuance of bonds for the projects described in section 306(a)(24).’’.
TIAL

7 USC 1926.

SEC. 6008. TRIBAL COLLEGE AND UNIVERSITY ESSENTIAL COMMUNITY
FACILITIES.

Section 306(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)) (as amended by section 6007(a)) is
amended by adding at the end the following:
‘‘(25) TRIBAL COLLEGE AND UNIVERSITY ESSENTIAL COMMUNITY FACILITIES.—
‘‘(A) IN GENERAL.—The Secretary may make grants
to tribal colleges and universities (as defined in section
316 of the Higher Education Act of 1965 (20 U.S.C. 1059c))
to provide the Federal share of the cost of developing
specific tribal college or university essential community
facilities in rural areas.
‘‘(B) FEDERAL SHARE.—
‘‘(i) IN GENERAL.—Except as provided in clauses
(ii) and (iii), the Secretary shall, by regulation, establish the maximum percentage of the cost of the facility
that may be covered by a grant under this paragraph.
‘‘(ii) MAXIMUM AMOUNT.—The amount of a grant
provided under this paragraph for a facility shall not
exceed 75 percent of the cost of developing the facility.
‘‘(iii) GRADUATED SCALE.—The Secretary shall provide for a graduated scale of the percentages of the
cost covered by a grant made under this paragraph
that provides higher percentages for facilities in

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PUBLIC LAW 107–171—MAY 13, 2002
communities that have lower community population
and income levels, as determined by the Secretary.
‘‘(C) AUTHORIZATION OF APPROPRIATIONS.—There is
authorized to be appropriated to carry out this paragraph
$10,000,000 for each of fiscal years 2003 through 2007.’’.

SEC. 6009. EMERGENCY AND IMMINENT COMMUNITY WATER ASSISTANCE GRANT PROGRAM.

Section 306A of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1926a) is amended—
(1) in the section heading, by inserting ‘‘AND IMMINENT’’
after ‘‘EMERGENCY’’;
(2) in subsection (a)—
(A) in paragraph (1), by inserting ‘‘, or when such
a decline is imminent’’ before the semicolon at the end;
and
(B) in paragraph (2)—
(i) in subparagraph (A), by striking ‘‘acute’’ and
inserting ‘‘acute, or imminent,’’; and
(ii) in subparagraph (B), by striking ‘‘decline’’ and
inserting ‘‘decline, or imminent decline,’’;
(3) in subsection (c)(2), by striking ‘‘occurred’’ and inserting
‘‘occurred, or will occur,’’;
(4) in subsection (d), by striking paragraph (1) and inserting
the following:
‘‘(1) IN GENERAL.—Grants made under this section may
be used—
‘‘(A) for waterline extensions from existing systems,
laying of new waterlines, repairs, significant maintenance,
digging of new wells, equipment replacement, and hook
and tap fees;
‘‘(B) for any other appropriate purpose associated with
developing sources of, treating, storing, or distributing
water;
‘‘(C) to assist communities in complying with the
requirements of the Federal Water Pollution Control Act
(33 U.S.C. 1251 et seq.) or the Safe Drinking Water Act
(42 U.S.C. 300f et seq.); and
‘‘(D) to provide potable water to communities through
other means.’’;
(5) in subsection (f)(2), by striking ‘‘$75,000’’ and inserting
‘‘$150,000’’;
(6) in subsection (h)—
(A) in the second sentence of paragraph (1), by striking
‘‘decline’’ and inserting ‘‘decline, or imminent decline,’’; and
(B) by striking paragraph (2) and inserting the following:
‘‘(2) TIMING OF REVIEW OF APPLICATIONS.—
‘‘(A) SIMPLIFIED APPLICATION.—The application process
developed by the Secretary under paragraph (1) shall
include a simplified application form that will permit expedited consideration of an application for a grant filed under
this section.
‘‘(B) PRIORITY REVIEW.—In processing applications for
any water or waste grant or loan authorized under this
title, the Secretary shall afford priority processing to an
application for a grant under this section to the extent

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116 STAT. 357

funds will be available for an award on the application
at the conclusion of priority processing.
‘‘(C) TIMING.—The Secretary shall, to the maximum
extent practicable, review and act on an application under
this section within 60 days after the date on which the
application is submitted to the Secretary.’’; and
(7) by striking subsection (i) and inserting the following:
‘‘(i) FUNDING.—
‘‘(1) RESERVATION.—
‘‘(A) IN GENERAL.—For each fiscal year, not less than
3 nor more than 5 percent of the total amount made available to carry out section 306(a)(2) for the fiscal year shall
be reserved for grants under this section.
‘‘(B) RELEASE.—Funds reserved under subparagraph
(A) for a fiscal year shall be reserved only until July 1
of the fiscal year.
‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—In addition to
funds made available under paragraph (1), there is authorized
to be appropriated to carry out this section $35,000,000 for
each of fiscal years 2003 through 2007.’’.
SEC. 6010. WATER AND WASTE FACILITY GRANTS FOR NATIVE AMERICAN TRIBES.

Section 306C of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1926c) is amended by striking subsection (e) and
inserting the following:
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) IN GENERAL.—Subject to paragraph (2), there are
authorized to be appropriated—
‘‘(A) for grants under this section, $30,000,000 for each
fiscal year;
‘‘(B) for loans under this section, $30,000,000 for each
fiscal year; and
‘‘(C) in addition to grants provided under subparagraph
(A), for grants under this section to benefit Indian tribes
(as defined in section 4 of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450b)),
$20,000,000 for each fiscal year.
‘‘(2) EXCEPTION.—An entity eligible to receive funding
through a grant made under section 306D shall not be eligible
for a grant from funds made available under paragraph (1)(C).’’.
SEC. 6011. GRANTS FOR WATER SYSTEMS FOR RURAL AND NATIVE
VILLAGES IN ALASKA.

Section 306D(d)(1) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1926d(d)(1)) is amended by striking
‘‘and 2002’’ and inserting ‘‘through 2007’’.
SEC. 6012. GRANTS TO NONPROFIT ORGANIZATIONS TO FINANCE THE
CONSTRUCTION, REFURBISHING, AND SERVICING OF
INDIVIDUALLY-OWNED HOUSEHOLD WATER WELL SYSTEMS IN RURAL AREAS FOR INDIVIDUALS WITH LOW OR
MODERATE INCOMES.

(a) IN GENERAL.—The Consolidated Farm and Rural Development Act is amended by inserting after section 306D (7 U.S.C.
1926d) the following:

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116 STAT. 358
7 USC 1926e.

7 USC 1926e
note.

PUBLIC LAW 107–171—MAY 13, 2002

‘‘SEC. 306E. GRANTS TO NONPROFIT ORGANIZATIONS TO FINANCE THE
CONSTRUCTION, REFURBISHING, AND SERVICING OF
INDIVIDUALLY-OWNED HOUSEHOLD WATER WELL SYSTEMS IN RURAL AREAS FOR INDIVIDUALS WITH LOW OR
MODERATE INCOMES.

‘‘(a) DEFINITION OF ELIGIBLE INDIVIDUAL.—In this section, the
term ‘eligible individual’ means an individual who is a member
of a household the members of which have a combined income
(for the most recent 12-month period for which the information
is available) that is not more than 100 percent of the median
nonmetropolitan household income for the State or territory in
which the individual resides, according to the most recent decennial
census of the United States.
‘‘(b) GRANTS.—
‘‘(1) IN GENERAL.—The Secretary may make grants to private nonprofit organizations for the purpose of providing loans
to eligible individuals for the construction, refurbishing, and
servicing of individual household water well systems in rural
areas that are or will be owned by the eligible individuals.
‘‘(2) TERMS OF LOANS.—A loan made with grant funds under
this section—
‘‘(A) shall have an interest rate of 1 percent;
‘‘(B) shall have a term not to exceed 20 years; and
‘‘(C) shall not exceed $8,000 for each water well system
described in paragraph (1).
‘‘(3) ADMINISTRATIVE EXPENSES.—A recipient of a grant
made under this section may use grant funds to pay administrative expenses associated with providing the assistance described
in paragraph (1), as determined by the Secretary.
‘‘(c) PRIORITY IN AWARDING GRANTS.—In awarding grants under
this section, the Secretary shall give priority to an applicant that
has substantial expertise and experience in promoting the safe
and productive use of individually-owned household water well systems and ground water.
‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $10,000,000 for each
of fiscal years 2003 through 2007.’’.
(b) EFFECTIVE DATE.—The amendment made by subsection (a)
takes effect on October 1, 2002.
SEC. 6013. LOANS AND LOAN GUARANTEES FOR RENEWABLE ENERGY
SYSTEMS.

Section 310B(a)(3) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1932(a)(3)) is amended by inserting ‘‘and other
renewable energy systems (including wind energy systems and
anaerobic digestors for the purpose of energy generation)’’ after
‘‘solar energy systems’’.
SEC. 6014. RURAL BUSINESS ENTERPRISE GRANTS.

Section 310B(c)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1932(c)(1)) is amended—
(1) by striking ‘‘(1) IN GENERAL.—The Secretary’’ and
inserting the following:
‘‘(1) GRANTS.—
‘‘(A) IN GENERAL.—The Secretary’’; and
(2) by adding at the end the following:

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‘‘(B) SMALL

116 STAT. 359

AND EMERGING PRIVATE BUSINESS ENTER-

PRISES.—

‘‘(i) IN GENERAL.—For the purpose of subparagraph
(A), a small and emerging private business enterprise
shall include (regardless of the number of employees
or operating capital of the enterprise) an eligible nonprofit entity, or other tax-exempt organization, with
a principal office in an area that is located—
‘‘(I) on land of an existing or former Native
American reservation; and
‘‘(II) in a city, town, or unincorporated area
that has a population of not more than 5,000
inhabitants.
‘‘(ii) USE OF GRANT.—An eligible nonprofit entity,
or other tax exempt organization, described in clause
(i) may use assistance provided under this paragraph
to create, expand, or operate value-added processing
in an area described in clause (i) in connection with
production agriculture.
‘‘(iii) PRIORITY.—In making grants under this paragraph, the Secretary shall give priority to grants that
will be used to provide assistance to eligible nonprofit
entities and other tax exempt organizations described
in clause (i).’’.
SEC. 6015. RURAL COOPERATIVE DEVELOPMENT GRANTS.

Section 310B(e) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1932(e)) is amended—
(1) in paragraph (5)(F), before the period at the end the
following: ‘‘, except that the Secretary shall not require nonFederal financial support in an amount that is greater than
5 percent in the case of a 1994 institution (as defined in
section 532 of the Equity in Educational Land-Grant Status
Act of 1994 (7 U.S.C. 301 note; Public Law 103–382))’’; and
(2) in paragraph (9), by striking ‘‘2002’’ and inserting
‘‘2007’’.
SEC. 6016. GRANTS TO BROADCASTING SYSTEMS.

Section 310B(f) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1932(f)) is amended by adding at the end
the following:
‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $5,000,000
for each of fiscal years 2002 through 2007.’’.
SEC. 6017. BUSINESS AND INDUSTRY LOAN MODIFICATIONS.

Section 310B of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1932) is amended by striking subsection (g) and
inserting the following:
‘‘(g) BUSINESS AND INDUSTRY DIRECT AND GUARANTEED
LOANS.—
‘‘(1) DEFINITION OF BUSINESS AND INDUSTRY LOAN.—In this
subsection, the term ‘business and industry loan’ means a business and industry direct or guaranteed loan that is made or
guaranteed by the Secretary under subsection (a)(1).
‘‘(2) LOAN GUARANTEES FOR THE PURCHASE OF COOPERATIVE
STOCK.—

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(A) IN GENERAL.—The Secretary may guarantee a
business and industry loan to individual farmers or
ranchers for the purpose of purchasing capital stock of
a farmer or rancher cooperative established for the purpose
of processing an agricultural commodity.
‘‘(B) PROCESSING CONTRACTS DURING INITIAL PERIOD.—
A cooperative described in subparagraph (A) for which
a farmer or rancher receives a guarantee to purchase stock
under subparagraph (A) may contract for services to process
agricultural commodities, or otherwise process value-added
agricultural products, during the 5-year period beginning
on the date of the startup of the cooperative in order
to provide adequate time for the planning and construction
of the processing facility of the cooperative.
‘‘(C) FINANCIAL INFORMATION.—Financial information
required by the Secretary from a farmer or rancher as
a condition of making a business and industry loan guarantee under this paragraph shall be provided in the manner
generally required by commercial agricultural lenders in
the area.
‘‘(3) LOANS TO COOPERATIVES.—
‘‘(A) IN GENERAL.—The Secretary may make or guarantee a business and industry loan to a cooperative
organization that is headquartered in a metropolitan area
if the loan is used for a project or venture described in
subsection (a) that is located in a rural area or a loan
guarantee that meets the requirements of paragraph (6).
‘‘(B) REFINANCING.—A cooperative organization that is
eligible for a business and industry loan shall be eligible
to refinance an existing business and industry loan with
a lender if—
‘‘(i) the cooperative organization—
‘‘(I) is current and performing with respect
to the existing loan; and
‘‘(II) is not, and has not been, in payment
default, or the collateral of which has not been
converted, with respect to the existing loan; and
‘‘(ii) there is adequate security or full collateral
for the refinanced loan.
‘‘(4) LOAN APPRAISALS.—The Secretary may require that
any appraisal made in connection with a business and industry
loan be conducted by a specialized appraiser that uses standards that are similar to standards used for similar purposes
in the private sector, as determined by the Secretary.
‘‘(5) FEES.—The Secretary may assess a 1-time fee for any
guaranteed business and industry loan in an amount that does
not exceed 2 percent of the guaranteed principal portion of
the loan.
‘‘(6) LOAN GUARANTEES IN NONRURAL AREAS.—
‘‘(A) IN GENERAL.—The Secretary may guarantee a
business and industry loan to a cooperative organization
for a facility that is not located in a rural area if—
‘‘(i) the primary purpose of the loan guarantee
is for a facility to provide value-added processing for
agricultural producers that are located within 80 miles
of the facility;

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‘‘(ii) the applicant demonstrates to the Secretary
that the primary benefit of the loan guarantee will
be to provide employment for residents of a rural area;
and
‘‘(iii) the total amount of business and industry
loans guaranteed for a fiscal year under this paragraph
does not exceed 10 percent of the business and industry
loans guaranteed for the fiscal year under subsection
(a)(1).
‘‘(B) PRINCIPAL AMOUNTS.—The principal amount of a
business and industry loan guaranteed under this paragraph may not exceed $25,000,000.
‘‘(7) INTANGIBLE ASSETS.—In determining whether a
cooperative organization is eligible for a guaranteed business
and industry loan, the Secretary may consider the market
value of a properly appraised brand name, patent, or trademark
of the cooperative.
‘‘(8) LIMITATIONS ON LOAN GUARANTEES FOR COOPERATIVE
ORGANIZATIONS.—
‘‘(A) PRINCIPAL AMOUNT.—
‘‘(i) IN GENERAL.—Subject to clause (ii), the principal amount of a business and industry loan made
to a cooperative organization and guaranteed under
this subsection shall not exceed $40,000,000.
‘‘(ii) USE.—To be eligible for a guarantee under
this subsection for a business and industry loan made
to a cooperative organization, the principal amount
of the any such loan in excess of $25,000,000 shall
be used to carry out a project—
‘‘(I) in a rural area; and
‘‘(II) that provides for the value-added processing of agricultural commodities.
‘‘(B) APPLICATIONS.—If a cooperative organization submits an application for a guarantee under this subsection
of a business and industry loan with a principal amount
that is in excess of $25,000,000, the Secretary—
‘‘(i) shall review and, if appropriate, approve the
application; and
‘‘(ii) may not delegate the approval authority.
‘‘(C) MAXIMUM AMOUNT.—The total amount of business
and industry loans made to cooperative organizations and
guaranteed for a fiscal year under this subsection with
principal amounts that are in excess of $25,000,000 may
not exceed 10 percent of the business and industry loans
guaranteed for the fiscal year under subsection (a)(1).’’.
SEC. 6018. USE OF RURAL DEVELOPMENT LOANS AND GRANTS FOR
OTHER PURPOSES.

Subtitle A of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1921 et seq.) (as amended by section 5006) is amended
by adding at the end the following:
‘‘SEC. 310G. USE OF RURAL DEVELOPMENT LOANS AND GRANTS FOR
OTHER PURPOSES.

7 USC 1936a.

‘‘If, after making a loan or a grant described in section 381E(d),
the Secretary determines that the circumstances under which the
loan or grant was made have sufficiently changed to make the
project or activity for which the loan or grant was made available

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no longer appropriate, the Secretary may allow the loan borrower
or grant recipient to use property (real and personal) purchased
or improved with the loan or grant funds, or proceeds from the
sale of property (real and personal) purchased with such funds,
for another project or activity that (as determined by the Secretary)—
‘‘(1) will be carried out in the same area as the original
project or activity;
‘‘(2) meets the criteria for a loan or a grant described
in section 381E(d); and
‘‘(3) satisfies such additional requirements as are established by the Secretary.’’.
SEC. 6019. SIMPLIFIED APPLICATION FORMS FOR LOAN GUARANTEES.

Section 333A of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1983a) (as amended by section 5307) is amended
by striking subsection (g) and inserting the following:
‘‘(g) SIMPLIFIED APPLICATION FORMS FOR LOAN GUARANTEES.—
‘‘(1) IN GENERAL.—The Secretary shall provide to lenders
a short, simplified application form for guarantees under this
title of—
‘‘(A) farmer program loans the principal amount of
which is $125,000 or less; and
‘‘(B) business and industry guaranteed loans under
section 310B(a)(1) the principal amount of which is—
‘‘(i) in the case of a loan guarantee made during
fiscal year 2002 or 2003, $400,000 or less; and
‘‘(ii) in the case of a loan guarantee made during
any subsequent fiscal year—
‘‘(I) $400,000 or less; or
‘‘(II) if the Secretary determines that there
is not a significant increased risk of a default
on the loan, $600,000 or less.
‘‘(2) WATER AND WASTE DISPOSAL GRANTS AND LOANS.—
The Secretary shall develop an application process that accelerates, to the maximum extent practicable, the processing of
applications for water and waste disposal grants or direct or
guaranteed loans under paragraph (1) or (2) of section 306(a)
the grant award amount or principal loan amount, respectively,
of which is $300,000 or less.
‘‘(3) ADMINISTRATION.—In developing an application under
this subsection, the Secretary shall—
‘‘(A) consult with commercial and cooperative lenders;
and
‘‘(B) ensure that—
‘‘(i) the form can be completed manually or electronically, at the option of the lender;
‘‘(ii) the form minimizes the documentation
required to accompany the form;
‘‘(iii) the cost of completing and processing the
form is minimal; and
‘‘(iv) the form can be completed and processed in
an expeditious manner.’’.
SEC. 6020. DEFINITION OF RURAL AND RURAL AREA.

(a) IN GENERAL.—Section 343(a) of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1991(a)) is amended by adding
at the end the following:

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‘‘(13) RURAL AND RURAL AREA.—
‘‘(A) IN GENERAL.—Except as otherwise provided in
this paragraph, the terms ‘rural’ and ‘rural area’ mean
any area other than—
‘‘(i) a city or town that has a population of greater
than 50,000 inhabitants; and
‘‘(ii) the urbanized area contiguous and adjacent
to such a city or town.
‘‘(B) WATER AND WASTE DISPOSAL GRANTS AND DIRECT
AND GUARANTEED LOANS.—For the purpose of water and
waste disposal grants and direct and guaranteed loans
provided under paragraphs (1), (2), and (24) of section
306(a), the terms ‘rural’ and ‘rural area’ mean a city, town,
or unincorporated area that has a population of no more
than 10,000 inhabitants.
‘‘(C) COMMUNITY FACILITY LOANS AND GRANTS.—For the
purpose of community facility direct and guaranteed loans
and grants under paragraphs (1), (19), (20), (21), and (24)
of section 306(a), the terms ‘rural’ and ‘rural area’ mean
a city, town, or unincorporated area that has a population
of not more than 20,000 inhabitants.
‘‘(D)
MULTIJURISDICTIONAL
REGIONAL
PLANNING
ORGANIZATIONS; NATIONAL RURAL DEVELOPMENT PARTNERSHIP.—In sections 306(a)(23) and 378, the term ‘rural area’
means—
‘‘(i) all the territory of a State that is not within
the boundary of any standard metropolitan statistical
area; and
‘‘(ii) all territory within any standard metropolitan
statistical area within a census tract having a population density of less than 20 persons per square mile,
as determined by the Secretary according to the most
recent census of the United States as of any date.
‘‘(E) RURAL BUSINESS INVESTMENT PROGRAM.—In subtitle H, the term ‘rural area’ means an area that is
located—
‘‘(i) outside a standard metropolitan statistical
area; or
‘‘(ii) within a community that has a population
of 50,000 inhabitants or less.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 306(a) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1926(a)) is amended by striking
paragraph (7).
(2) Section 381A of the Consolidated Farm and Rural
Development Act (7 U.S.C. 2009) is amended—
(A) by striking paragraph (1); and
(B) by redesignating paragraphs (2) and (3) as paragraphs (1) and (2), respectively.
(3) Section 735 of the Agriculture, Rural Development,
Food and Drug Administration, and Related Agencies Appropriations Act, 1999 (112 Stat. 2681–29) is repealed.

7 USC 2009 note.

SEC. 6021. NATIONAL RURAL DEVELOPMENT PARTNERSHIP.

Subtitle D of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1981 et seq.) (as amended by section 5321) is amended
by adding at the end the following:

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116 STAT. 364
7 USC 2008m.

Establishment.

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‘‘SEC. 378. NATIONAL RURAL DEVELOPMENT PARTNERSHIP.

‘‘(a) DEFINITIONS.—In this section:
‘‘(1) AGENCY WITH RURAL RESPONSIBILITIES.—The term
‘agency with rural responsibilities’ means any executive agency
(as defined in section 105 of title 5, United States Code) that
implements a Federal law, or administers a program, targeted
at or having a significant impact on rural areas.
‘‘(2) COORDINATING COMMITTEE.—The term ‘Coordinating
Committee’ means the National Rural Development Coordinating Committee established by subsection (c).
‘‘(3) PARTNERSHIP.—The term ‘Partnership’ means the
National Rural Development Partnership continued by subsection (b).
‘‘(4) STATE RURAL DEVELOPMENT COUNCIL.—The term ‘State
rural development council’ means a State rural development
council that meets the requirements of subsection (d).
‘‘(b) PARTNERSHIP.—
‘‘(1) IN GENERAL.—The Secretary shall continue the
National Rural Development Partnership composed of—
‘‘(A) the Coordinating Committee; and
‘‘(B) State rural development councils.
‘‘(2) PURPOSES.—The purposes of the Partnership are to
empower and build the capacity of States and rural communities to design flexible and innovative responses to their own
special rural development needs, with local determinations of
progress and selection of projects and activities.
‘‘(3) GOVERNING PANEL.—
‘‘(A) IN GENERAL.—A panel consisting of representatives of the Coordinating Committee and State rural
development councils shall be established to lead and
coordinate the strategic operation, policies, and practices
of the Partnership.
‘‘(B) ANNUAL REPORTS.—In conjunction with the Coordinating Committee and State rural development councils,
the panel shall prepare and submit to Congress an annual
report on the activities of the Partnership.
‘‘(4) ROLE OF FEDERAL GOVERNMENT.—The role of the Federal Government in the Partnership may be that of a partner
and facilitator, with Federal agencies authorized—
‘‘(A) to cooperate with States to implement the Partnership;
‘‘(B) to provide States with the technical and administrative support necessary to plan and implement tailored
rural development strategies to meet local needs;
‘‘(C) to ensure that the head of each agency with rural
responsibilities designates a senior-level agency official to
represent the agency on the Coordinating Committee and
directs appropriate field staff to participate fully with the
State rural development council within the jurisdiction of
the field staff; and
‘‘(D) to enter into cooperative agreements with, and
to provide grants and other assistance to, the Coordinating
Committee and State rural development councils.
‘‘(c) NATIONAL RURAL DEVELOPMENT COORDINATING COMMITTEE.—

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‘‘(1) ESTABLISHMENT.—The Secretary shall establish a
National Rural Development Coordinating Committee within
the Department of Agriculture.
‘‘(2) COMPOSITION.—The Coordinating Committee shall be
composed of—
‘‘(A) 1 representative of each agency with rural responsibilities; and
‘‘(B) representatives, approved by the Secretary, of—
‘‘(i) national associations of State, regional, local,
and tribal governments and intergovernmental and
multijurisdictional agencies and organizations;
‘‘(ii) national public interest groups;
‘‘(iii) other national nonprofit organizations that
elect to participate in the activities of the Coordinating
Committee; and
‘‘(iv) the private sector.
‘‘(3) DUTIES.—The Coordinating Committee shall—
‘‘(A) support the work of the State rural development
councils;
‘‘(B) facilitate coordination of rural development policies, programs, and activities among Federal agencies and
with those of State, local, and tribal governments, the
private sector, and nonprofit organizations;
‘‘(C) review and comment on policies, regulations, and
proposed legislation that affect or would affect rural areas
and gather and provide related information;
‘‘(D) develop and facilitate strategies to reduce or eliminate administrative and regulatory impediments; and
‘‘(E) require each State rural development council
receiving funds under this section to submit an annual
report on the use of the funds, including a description
of strategic plans, goals, performance measures, and outcomes for the State rural development council of the State.
‘‘(4) FEDERAL PARTICIPATION IN COORDINATING COMMITTEE.—
‘‘(A) IN GENERAL.—A Federal employee shall fully
participate in the governance and operations of the Coordinating Committee, including activities related to grants,
contracts, and other agreements, in accordance with this
section.
‘‘(B) CONFLICTS.—Participation by a Federal employee
in the Coordinating Committee in accordance with this
paragraph shall not constitute a violation of section 205
or 208 of title 18, United States Code.
‘‘(5) ADMINISTRATIVE SUPPORT.—The Secretary may provide
such administrative support for the Coordinating Committee
as the Secretary determines is necessary to carry out the duties
of the Coordinating Committee.
‘‘(6) PROCEDURES.—The Secretary may prescribe such regulations, bylaws, or other procedures as are necessary for the
operation of the Coordinating Committee.
‘‘(d) STATE RURAL DEVELOPMENT COUNCILS.—
‘‘(1) ESTABLISHMENT.—Notwithstanding chapter 63 of title
31, United States Code, each State may elect to participate
in the Partnership by entering into an agreement with the
Secretary to recognize a State rural development council.

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(2) COMPOSITION.—A State rural development council
shall—
‘‘(A) be composed of representatives of Federal, State,
local, and tribal governments, nonprofit organizations,
regional organizations, the private sector, and other entities
committed to rural advancement; and
‘‘(B) have a nonpartisan and nondiscriminatory membership that—
‘‘(i) is broad and representative of the economic,
social, and political diversity of the State; and
‘‘(ii) shall be responsible for the governance and
operations of the State rural development council.
‘‘(3) DUTIES.—A State rural development council shall—
‘‘(A) facilitate collaboration among Federal, State, local,
and tribal governments and the private and nonprofit sectors in the planning and implementation of programs and
policies that have an impact on rural areas of the State;
‘‘(B) monitor, report, and comment on policies and programs that address, or fail to address, the needs of the
rural areas of the State;
‘‘(C) as part of the Partnership, in conjunction with
the Coordinating Committee, facilitate the development of
strategies to reduce or eliminate conflicting or duplicative
administrative or regulatory requirements of Federal,
State, local, and tribal governments; and
‘‘(D)(i) provide to the Coordinating Committee an
annual plan with goals and performance measures; and
‘‘(ii) submit to the Coordinating Committee an annual
report on the progress of the State rural development
council in meeting the goals and measures.
‘‘(4) FEDERAL PARTICIPATION IN STATE RURAL DEVELOPMENT
COUNCILS.—
‘‘(A) IN GENERAL.—A State Director for Rural Development of the Department of Agriculture, other employees
of the Department, and employees of other Federal agencies
with rural responsibilities shall fully participate as voting
members in the governance and operations of State rural
development councils (including activities related to grants,
contracts, and other agreements in accordance with this
section) on an equal basis with other members of the State
rural development councils.
‘‘(B) CONFLICTS.—Participation by a Federal employee
in a State rural development council in accordance with
this paragraph shall not constitute a violation of section
205 or 208 of title 18, United States Code.
‘‘(e) ADMINISTRATIVE SUPPORT OF THE PARTNERSHIP.—
‘‘(1) DETAIL OF EMPLOYEES.—
‘‘(A) IN GENERAL.—In order to provide experience in
intergovernmental collaboration, the head of an agency
with rural responsibilities that elects to participate in the
Partnership may, and is encouraged to, detail to the Secretary for the support of the Partnership 1 or more
employees of the agency with rural responsibilities without
reimbursement for a period of up to 1 year.
‘‘(B) CIVIL SERVICE STATUS.—The detail shall be without interruption or loss of civil service status or privilege.

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‘‘(2) ADDITIONAL SUPPORT.—The Secretary may provide for
any additional support staff to the Partnership as the Secretary
determines to be necessary to carry out the duties of the Partnership.
‘‘(3) INTERMEDIARIES.—The Secretary may enter into a contract with a qualified intermediary under which the intermediary shall be responsible for providing administrative and
technical assistance to a State rural development council,
including administering the financial assistance available to
the State rural development council.
‘‘(f) MATCHING REQUIREMENTS FOR STATE RURAL DEVELOPMENT
COUNCILS.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
a State rural development council shall provide matching funds,
or in-kind goods or services, to support the activities of the
State rural development council in an amount that is not less
than 33 percent of the amount of Federal funds received from
a Federal agency under subsection (g)(2).
‘‘(2) EXCEPTIONS TO MATCHING REQUIREMENT FOR CERTAIN
FEDERAL FUNDS.—Paragraph (1) shall not apply to funds,
grants, funds provided under contracts or cooperative agreements, gifts, contributions, or technical assistance received by
a State rural development council from a Federal agency that
are used—
‘‘(A) to support 1 or more specific program or project
activities; or
‘‘(B) to reimburse the State rural development council
for services provided to the Federal agency providing the
funds, grants, funds provided under contracts or cooperative agreements, gifts, contributions, or technical assistance.
‘‘(3) DEPARTMENT’S SHARE.—The Secretary shall develop
a plan to decrease, over time, the share of the Department
of Agriculture of the cost of the core operations of State rural
development councils.
‘‘(g) FUNDING.—
‘‘(1) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this section $10,000,000
for each of fiscal years 2003 through 2007.
‘‘(2) FEDERAL AGENCIES.—
‘‘(A) IN GENERAL.—Notwithstanding any other provision of law limiting the ability of an agency, along with
other agencies, to provide funds to the Coordinating Committee or a State rural development council in order to
carry out the purposes of this section, a Federal agency
may make grants, gifts, or contributions to, provide technical assistance to, or enter into contracts or cooperative
agreements with, the Coordinating Committee or a State
rural development council.
‘‘(B) ASSISTANCE.—Federal agencies are encouraged to
use funds made available for programs that have an impact
on rural areas to provide assistance to, and enter into
contracts with, the Coordinating Committee or a State
rural development council, as described in subparagraph
(A).

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‘‘(3) CONTRIBUTIONS.—The Coordinating Committee and a
State rural development council may accept private contributions.
‘‘(h) TERMINATION.—The authority provided under this section
shall terminate on the date that is 5 years after the date of enactment of this section.’’.
SEC. 6022. RURAL TELEWORK.

Subtitle D of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1981 et seq.) (as amended by section 6021) is amended
by adding at the end the following:
7 USC 2008n.

‘‘SEC. 379. RURAL TELEWORK.

‘‘(a) DEFINITIONS.—In this section:
‘‘(1) ELIGIBLE ORGANIZATION.—The term ‘eligible organization’ means a nonprofit entity, an educational institution, an
Indian tribe (as defined in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b)), or
any other organization, in a rural area (except for the institute),
that meets the requirements of this section and such other
requirements as are established by the Secretary.
‘‘(2) INSTITUTE.—The term ‘institute’ means a rural
telework institute established using a grant under subsection
(b).
‘‘(3) TELEWORK.—The term ‘telework’ means the use of
telecommunications to perform work functions at a rural work
center located outside the place of business of an employer.
‘‘(b) RURAL TELEWORK INSTITUTE.—
‘‘(1) IN GENERAL.—The Secretary shall make 1 or more
grants to an eligible organization to pay the Federal share
of the cost of establishing and operating a national rural
telework institute to carry out projects described in paragraph
(2).
‘‘(2) PROJECTS.—The institute shall use grant funds
received under this subsection to carry out a 5-year project—
‘‘(A) to serve as a clearinghouse for telework research
and development;
‘‘(B) to conduct outreach to rural communities and
rural workers;
‘‘(C) to develop and share best practices in rural
telework throughout the United States;
‘‘(D) to develop innovative, market-driven telework
projects and joint ventures with the private sector that
employ workers in rural areas in jobs that promote economic self-sufficiency;
‘‘(E) to share information about the design and
implementation of telework arrangements;
‘‘(F) to support private sector businesses that are
transitioning to telework;
‘‘(G) to support and assist telework projects and
individuals at the State and local level; and
‘‘(H) to perform such other functions as the Secretary
considers appropriate.
‘‘(3) NON-FEDERAL SHARE.—
‘‘(A) IN GENERAL.—As a condition of receiving a grant
under this subsection, an eligible organization shall agree
to obtain, after the application of the eligible organization

Grants.

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has been approved and notice of award has been issued,
contributions from non-Federal sources that are equal to—
‘‘(i) during each of the first, second, and third
years of a project, 30 percent of the amount of the
grant; and
‘‘(ii) during each of the fourth and fifth years of
the project, 50 percent of the amount of the grant.
‘‘(B) INDIAN TRIBES.—Notwithstanding subparagraph
(A), an Indian tribe may use any Federal funds made
available to the Indian tribe for self-governance to pay
the non-Federal contributions required under subparagraph
(A).
‘‘(C) FORM.—The non-Federal contributions required
under subparagraph (A) may be in the form of in-kind
contributions, including office equipment, office space, computer software, consultant services, computer networking
equipment, and related services.
‘‘(c) TELEWORK GRANTS.—
‘‘(1) IN GENERAL.—Subject to paragraphs (2) through (5),
the Secretary shall make grants to eligible organizations to
pay the Federal share of the cost of—
‘‘(A) obtaining equipment and facilities to establish
or expand telework locations in rural areas; and
‘‘(B) operating telework locations in rural areas.
‘‘(2) APPLICATIONS.—To be eligible to receive a grant under
this subsection, an eligible organization shall submit to the
Secretary, and receive the approval of the Secretary of, an
application for the grant that demonstrates that the eligible
organization has adequate resources and capabilities to establish or expand a telework location in a rural area.
‘‘(3) NON-FEDERAL SHARE.—
‘‘(A) IN GENERAL.—As a condition of receiving a grant
under this subsection, an eligible organization shall agree
to obtain, after the application of the eligible organization
has been approved and notice of award has been issued,
contributions from non-Federal sources that are equal to
50 percent of the amount of the grant.
‘‘(B) INDIAN TRIBES.—Notwithstanding subparagraph
(A), an Indian tribe may use Federal funds made available
to the tribe for self-governance to pay the non-Federal
contributions required under subparagraph (A).
‘‘(C) SOURCES.—The non-Federal contributions required
under subparagraph (A)—
‘‘(i) may be in the form of in-kind contributions,
including office equipment, office space, computer software, consultant services, computer networking equipment, and related services; and
‘‘(ii) may not be made from funds made available
for community development block grants under title
I of the Housing and Community Development Act
of 1974 (42 U.S.C. 5301 et seq.).
‘‘(4) DURATION.—The Secretary may not provide a grant
under this subsection to expand or operate a telework location
in a rural area after the date that is 3 years after the establishment of the telework location.

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‘‘(5) AMOUNT.—The amount of a grant provided to an
eligible organization under this subsection shall be not less
than $1,000,000 and not more than $2,000,000.
‘‘(d) APPLICABILITY OF CERTAIN FEDERAL LAW.—An eligible
organization that receives funds under this section shall be subject
to the provisions of Federal law (including regulations) administered
by the Secretary of Labor or the Equal Employment Opportunity
Commission that govern the responsibilities of employers to
employees.
‘‘(e) REGULATIONS.—Not later than 180 days after the date
of enactment of this section, the Secretary shall promulgate regulations to carry out this section.
‘‘(f) AUTHORIZATION OF APPROPRIATION.—There is authorized
to be appropriated to carry out this section $30,000,000 for each
of fiscal years 2002 through 2007, of which $5,000,000 shall be
provided to establish and support an institute under subsection
(b).’’.
SEC. 6023. HISTORIC BARN PRESERVATION.

Subtitle D of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1981 et seq.) (as amended by section 6022) is amended
by adding at the end the following:
7 USC 2008o.

‘‘SEC. 379A. HISTORIC BARN PRESERVATION.

‘‘(a) DEFINITIONS.—In this section:
‘‘(1) BARN.—The term ‘barn’ means a building (other than
a dwelling) on a farm, ranch, or other agricultural operation
for—
‘‘(A) housing animals;
‘‘(B) storing or processing crops;
‘‘(C) storing and maintaining agricultural equipment;
or
‘‘(D) serving an essential or useful purpose related
to agricultural activities conducted on the adjacent land.
‘‘(2) ELIGIBLE APPLICANT.—The term ‘eligible applicant’
means—
‘‘(A) a State department of agriculture (or a designee);
‘‘(B) a national or State nonprofit organization that—
‘‘(i) is described in section 501(c)(3) of the Internal
Revenue Code of 1986 and exempt from taxation under
section 501(a) of such Code; and
‘‘(ii) has experience or expertise, as determined
by the Secretary, in the identification, evaluation,
rehabilitation, preservation, or protection of historic
barns; and
‘‘(C) a State historic preservation office.
‘‘(3) HISTORIC BARN.—The term ‘historic barn’ means a
barn that—
‘‘(A) is at least 50 years old;
‘‘(B) retains sufficient integrity of design, materials,
and construction to clearly identify the barn as an agricultural building; and
‘‘(C) meets the criteria for listing on National, State,
or local registers or inventories of historic structures.
‘‘(4) SECRETARY.—The term ‘Secretary’ means the Secretary, acting through the Under Secretary of Rural Development.

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‘‘(b) PROGRAM.—The Secretary shall establish a historic barn
preservation program—
‘‘(1) to assist States in developing a list of historic barns;
‘‘(2) to collect and disseminate information on historic
barns;
‘‘(3) to foster educational programs relating to the history,
construction techniques, rehabilitation, and contribution to
society of historic barns; and
‘‘(4) to sponsor and conduct research on—
‘‘(A) the history of barns; and
‘‘(B) best practices to protect and rehabilitate historic
barns from the effects of decay, fire, arson, and natural
disasters.
‘‘(c) GRANTS.—
‘‘(1) IN GENERAL.—The Secretary may make grants to, or
enter into contracts or cooperative agreements with, eligible
applicants to carry out an eligible project under paragraph
(2).
‘‘(2) ELIGIBLE PROJECTS.—A grant under this subsection
may be made to an eligible applicant for a project—
‘‘(A) to rehabilitate or repair a historic barn;
‘‘(B) to preserve a historic barn through—
‘‘(i) the installation of a fire protection system,
including fireproofing or fire detection system and
sprinklers; and
‘‘(ii) the installation of a system to prevent vandalism; and
‘‘(C) to identify, document, and conduct research on
a historic barn to develop and evaluate appropriate techniques or best practices for protecting historic barns.
‘‘(3) REQUIREMENTS.—An eligible applicant that receives
a grant for a project under this subsection shall comply with
any standards established by the Secretary of the Interior
for historic preservation projects.
‘‘(4) AUTHORIZATION OF APPROPRIATIONS.—There are
authorized to be appropriated such sums as are necessary to
carry out this section for each of fiscal years 2002 through
2007.’’.
SEC. 6024. GRANTS FOR NOAA WEATHER RADIO TRANSMITTERS.

Subtitle D of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1981 et seq.) (as amended by section 6023)) is amended
by adding at the end the following:
‘‘SEC. 379B. GRANTS FOR NOAA WEATHER RADIO TRANSMITTERS.

7 USC 2008p.

‘‘(a) IN GENERAL.—The Secretary, acting through the Administrator of the Rural Utilities Service, may make grants to public
and nonprofit entities, and borrowers of loans made by the Rural
Utilities Service, for the Federal share of the cost of acquiring
radio transmitters to increase coverage of rural areas by the all
hazards weather radio broadcast system of the National Oceanic
and Atmospheric Administration.
‘‘(b) ELIGIBILITY.—To be eligible for a grant under this section,
an applicant shall provide to the Secretary—
‘‘(1) a binding commitment from a tower owner to place
the transmitter on a tower; and
‘‘(2) a description of how the tower placement will increase
coverage of a rural area by the all hazards weather radio

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broadcast system of the National Oceanic and Atmospheric
Administration.
‘‘(c) FEDERAL SHARE.—A grant provided under this section shall
be not more than 75 percent of the total cost of acquiring a radio
transmitter, as described in subsection (a).
‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 2002 through 2007.’’.
SEC. 6025. GRANTS TO TRAIN FARM WORKERS IN NEW TECHNOLOGIES
AND TO TRAIN FARM WORKERS IN SPECIALIZED SKILLS
NECESSARY FOR HIGHER VALUE CROPS.

Subtitle D of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1981 et seq.) (as amended by section 6024) is amended
by adding at the end the following:
7 USC 2008q.

‘‘SEC. 379C. GRANTS TO TRAIN FARM WORKERS IN NEW TECHNOLOGIES AND TO TRAIN FARM WORKERS IN SPECIALIZED SKILLS NECESSARY FOR HIGHER VALUE CROPS.

‘‘(a) IN GENERAL.—The Secretary shall make grants to nonprofit
organizations, or to a consortium of nonprofit organizations, agribusinesses, State and local governments, agricultural labor
organizations, farmer or rancher cooperatives, and communitybased organizations with the capacity to train farm workers.
‘‘(b) USE OF FUNDS.—An entity to which a grant is made under
this section shall use the grant to train farm workers to use new
technologies and develop specialized skills for agricultural development.
‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $10,000,000 for each
of fiscal years 2002 through 2007.’’.
SEC. 6026. RURAL COMMUNITY ADVANCEMENT PROGRAM.

(a) NATIONAL RESERVE PROGRAM.—Section 381E of the Consolidated Farm and Rural Development Act (7 U.S.C. 2009d) is
amended—
(1) in subsection (b)—
(A) by striking paragraph (4); and
(B) by redesignating paragraph (5) as paragraph (4);
(2) by striking subsection (e);
(3) by redesignating subsections (f) through (h) as subsections (e) through (g), respectively; and
(4) in subsection (g) (as so redesignated), by striking ‘‘subsection (g) of this section’’ and inserting ‘‘subsection (f)’’.
(b) RURAL VENTURE CAPITAL DEMONSTRATION PROGRAM.—Section 381O of the Consolidated Farm and Rural Development Act
(7 U.S.C. 2009n) is repealed.
(c) CONFORMING AMENDMENTS.—Section 381G of the Consolidated Farm and Rural Development Act (7 U.S.C. 2009f(a)) is
amended—
(1) in subsection (a), by striking ‘‘section 381E(g)’’ each
place it appears and inserting ‘‘section 381E(f)’’; and
(2) in subsection (b)(1), by striking ‘‘section 381E(h)’’ and
inserting ‘‘section 381E(g)’’.

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SEC. 6027. DELTA REGIONAL AUTHORITY.

(a) VOTING.—Section 382B(c) of the Consolidated Farm and
Rural Development Act (7 U.S.C. 2009aa–1(c)) is amended by
striking paragraph (1) and inserting the following:
‘‘(1) IN GENERAL.—
‘‘(A) TEMPORARY METHOD.—During the period beginning on the date of enactment of this subparagraph and
ending on December 31, 2004, a decision by the Authority
shall require the affirmative vote of the Federal cochairperson and a majority of the State members (not including
any member representing a State that is delinquent under
subsection (g)(2)(C)) to be effective.
‘‘(B) PERMANENT METHOD.—Effective beginning on
January 1, 2005, a decision by the Authority shall require
a majority vote of the Authority (not including any member
representing a State that is delinquent under subsection
(g)(2)(C)) to be effective.’’.
(b) AUTHORITY TO ISSUE REGULATIONS.—Section 382B(e)(4) of
the Consolidated Farm and Rural Development Act (7 U.S.C.
2009aa–1(e)(4)) is amended by striking ‘‘and rules’’ and inserting
‘‘, rules, and regulations’’.
(c) ECONOMIC AND COMMUNITY DEVELOPMENT GRANTS.—Section
382C(b) of the Consolidated Farm and Rural Development Act
(7 U.S.C. 2009aa–2(b)) is amended by striking paragraph (3).
(d) SUPPLEMENTS TO FEDERAL GRANT PROGRAMS.—Section 382D
of the Consolidated Farm and Rural Development Act (7 U.S.C.
2009aa–3) is amended to read as follows:

Effective date.
Termination
date.

Effective date.

‘‘SEC. 382D. SUPPLEMENTS TO FEDERAL GRANT PROGRAMS.

‘‘(a) FINDING.—Congress finds that certain States and local
communities of the region, including local development districts,
may be unable to take maximum advantage of Federal grant programs for which the States and communities are eligible because—
‘‘(1) the States or communities lack the economic resources
to provide the required matching share; or
‘‘(2) there are insufficient funds available under the
applicable Federal law authorizing the Federal grant program
to meet pressing needs of the region.
‘‘(b) FEDERAL GRANT PROGRAM FUNDING.—Notwithstanding any
provision of law limiting the Federal share, the areas eligible for
assistance, or the authorizations of appropriations of any Federal
grant program, and in accordance with subsection (c), the Authority,
with the approval of the Federal cochairperson and with respect
to a project to be carried out in the region—
‘‘(1) may increase the Federal share of the costs of a project
under the Federal grant program to not more than 90 percent
(except as provided in section 382F(b)); and
‘‘(2) shall use amounts made available to carry out this
subtitle to pay the increased Federal share.
‘‘(c) CERTIFICATIONS.—
‘‘(1) IN GENERAL.—In the case of any project for which
all or any portion of the basic Federal share of the costs
of the project is proposed to be paid under this section, no
Federal contribution shall be made until the Federal official
administering the Federal law that authorizes the Federal
grant program certifies that the project—

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‘‘(A) meets (except as provided in subsection (b)) the
applicable requirements of the applicable Federal grant
program; and
‘‘(B) could be approved for Federal contribution under
the Federal grant program if funds were available under
the law for the project.
‘‘(2) CERTIFICATION BY AUTHORITY.—
‘‘(A) IN GENERAL.—The certifications and determinations required to be made by the Authority for approval
of projects under this Act in accordance with section 382I—
‘‘(i) shall be controlling; and
‘‘(ii) shall be accepted by the Federal agencies.
‘‘(B) ACCEPTANCE BY FEDERAL COCHAIRPERSON.—In the
case of any project described in paragraph (1), any finding,
report, certification, or documentation required to be submitted with respect to the project to the head of the department, agency, or instrumentality of the Federal Government responsible for the administration of the Federal
grant program under which the project is carried out shall
be accepted by the Federal cochairperson.’’.
(e) GRANTS TO LOCAL DEVELOPMENT AGENCIES.—Section
382E(b)(1) of the Consolidated Farm and Rural Development Act
(7 U.S.C. 2009aa–4(b)(1)) is amended by striking ‘‘may’’ and
inserting ‘‘shall’’.
(f) APPROVAL OF DEVELOPMENT PLANS AND PROJECTS.—Section
382I of the Consolidated Farm and Rural Development Act (7
U.S.C. 2009aa–8) is amended—
(1) in subsection (a), by inserting ‘‘and approved’’ after
‘‘reviewed’’; and
(2) in subsection (d), by striking ‘‘VOTES FOR DECISIONS.—
’’ and inserting ‘‘APPROVAL OF GRANT APPLICATIONS.—’’.
(g) AUTHORIZATION OF APPROPRIATIONS.—Section 382M(a) of
the Consolidated Farm and Rural Development Act (7 U.S.C.
2009aa–12(a)) is amended by striking ‘‘2002’’ and inserting ‘‘2007’’.
(h) TERMINATION OF AUTHORITY.—Section 382N of the Consolidated Farm and Rural Development Act (7 U.S.C. 2009aa–13) is
amended by striking ‘‘2002’’ and inserting ‘‘2007’’.
(i) DELTA REGION AGRICULTURAL ECONOMIC DEVELOPMENT.—
Subtitle D of the Consolidated Farm and Rural Development Act
(7 U.S.C. 1981 et seq.) (as amended by section 6025) is amended
by adding at the end the following:
7 USC 2008r.

‘‘SEC. 379D. DELTA REGION AGRICULTURAL ECONOMIC DEVELOPMENT.

‘‘(a) IN GENERAL.—The Secretary may make grants to assist
in the development of state-of-the-art technology in animal nutrition
(including research and development of the technology) and valueadded manufacturing to promote an economic platform for the Delta
region (as defined in section 382A) to relieve severe economic conditions.
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to carry out this section $7,000,000 for each
of fiscal years 2002 through 2007.’’.
(j) DEFINITION OF LOWER MISSISSIPPI.—Section 4(2)(I) of the
Delta Development Act (42 U.S.C. 3121 note; Public Law 100–
460) is amended by inserting ‘‘Butler, Conecuh, Escambia, Monroe,’’
after ‘‘Russell,’’.

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116 STAT. 375

SEC. 6028. NORTHERN GREAT PLAINS REGIONAL AUTHORITY.

The Consolidated Farm and Rural Development Act (7 U.S.C.
1921 et seq.) is amended by adding at the end the following:

‘‘Subtitle G—Northern Great Plains
Regional Authority
‘‘SEC. 383A. DEFINITIONS.

7 USC 2009bb.

‘‘In this subtitle:
‘‘(1) AUTHORITY.—The term ‘Authority’ means the Northern
Great Plains Regional Authority established by section 383B.
‘‘(2) FEDERAL GRANT PROGRAM.—The term ‘Federal grant
program’ means a Federal grant program to provide assistance
in—
‘‘(A) implementing the recommendations of the
Northern Great Plains Rural Development Commission
established by the Northern Great Plains Rural Development Act (7 U.S.C. 2661 note; Public Law 103–318);
‘‘(B) acquiring or developing land;
‘‘(C) constructing or equipping a highway, road, bridge,
or facility;
‘‘(D) carrying out other economic development activities; or
‘‘(E) conducting research activities related to the activities described in subparagraphs (A) through (D).
‘‘(3) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning
given the term in section 4 of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450b).
‘‘(4) REGION.—The term ‘region’ means the States of Iowa,
Minnesota, Nebraska, North Dakota, and South Dakota.
‘‘SEC. 383B. NORTHERN GREAT PLAINS REGIONAL AUTHORITY.

7 USC 2009bb–1.

‘‘(a) ESTABLISHMENT.—
‘‘(1) IN GENERAL.—There is established the Northern Great
Plains Regional Authority.
‘‘(2) COMPOSITION.—The Authority shall be composed of—
‘‘(A) a Federal member, to be appointed by the President, by and with the advice and consent of the Senate;
‘‘(B) the Governor (or a designee of the Governor) of
each State in the region that elects to participate in the
Authority; and
‘‘(C) a member of an Indian tribe, who shall be a
chairperson of an Indian tribe in the region or a designee
of such a chairperson, to be appointed by the President,
by and with the advice and consent of the Senate.
‘‘(3) COCHAIRPERSONS.—The Authority shall be headed by—
‘‘(A) the Federal member, who shall serve—
‘‘(i) as the Federal cochairperson; and
‘‘(ii) as a liaison between the Federal Government
and the Authority;
‘‘(B) a State cochairperson, who—
‘‘(i) shall be a Governor of a participating State
in the region; and
‘‘(ii) shall be elected by the State members for
a term of not less than 1 year; and
‘‘(C) the member of an Indian tribe, who shall serve—

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116 STAT. 376

‘‘(i) as the tribal cochairperson; and
‘‘(ii) as a liaison between the governments of Indian
tribes in the region and the Authority.
‘‘(b) ALTERNATE MEMBERS.—
‘‘(1) ALTERNATE FEDERAL COCHAIRPERSON.—The President
shall appoint an alternate Federal cochairperson.
‘‘(2) STATE ALTERNATES.—
‘‘(A) IN GENERAL.—The State member of a participating
State may have a single alternate, who shall be—
‘‘(i) a resident of that State; and
‘‘(ii) appointed by the Governor of the State.
‘‘(B) QUORUM.—A State alternate member shall not
be counted toward the establishment of a quorum of the
members of the Authority in any case in which a quorum
of the State members is required to be present.
‘‘(3) ALTERNATE TRIBAL COCHAIRPERSON.—The President
shall appoint an alternate tribal cochairperson, by and with
the advice and consent of the Senate.
‘‘(4) DELEGATION OF POWER.—No power or responsibility
of the Authority specified in paragraphs (2) and (3) of subsection
(c), and no voting right of any member of the Authority, shall
be delegated to any person who is not—
‘‘(A) a member of the Authority; or
‘‘(B) entitled to vote in Authority meetings.
‘‘(c) VOTING.—
‘‘(1) IN GENERAL.—A decision by the Authority shall require
a majority vote of the Authority (not including any member
representing a State that is delinquent under subsection
(g)(2)(D)) to be effective.
‘‘(2) QUORUM.—A quorum of State members shall be
required to be present for the Authority to make any policy
decision, including—
‘‘(A) a modification or revision of an Authority policy
decision;
‘‘(B) approval of a State or regional development plan;
and
‘‘(C) any allocation of funds among the States.
‘‘(3) PROJECT AND GRANT PROPOSALS.—The approval of
project and grant proposals shall be—
‘‘(A) a responsibility of the Authority; and
‘‘(B) conducted in accordance with section 383I.
‘‘(4) VOTING BY ALTERNATE MEMBERS.—An alternate
member shall vote in the case of the absence, death, disability,
removal, or resignation of the Federal, State, or Indian tribe
member for whom the alternate member is an alternate.
‘‘(d) DUTIES.—The Authority shall—
‘‘(1) develop, on a continuing basis, comprehensive and
coordinated plans and programs to establish priorities and
approve grants for the economic development of the region,
giving due consideration to other Federal, State, tribal, and
local planning and development activities in the region;
‘‘(2) not later than 220 days after the date of enactment
of this subtitle, establish priorities in a development plan for
the region (including 5-year regional outcome targets);
‘‘(3) assess the needs and assets of the region based on
available research, demonstrations, investigations, assessments, and evaluations of the region prepared by Federal,

President.

President.

Deadline.

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State, tribal, and local agencies, universities, local development
districts, and other nonprofit groups;
‘‘(4) formulate and recommend to the Governors and legislatures of States that participate in the Authority forms of interstate cooperation;
‘‘(5) work with State, tribal, and local agencies in developing
appropriate model legislation;
‘‘(6)(A) enhance the capacity of, and provide support for,
local development districts in the region; or
‘‘(B) if no local development district exists in an area in
a participating State in the region, foster the creation of a
local development district;
‘‘(7) encourage private investment in industrial, commercial, and other economic development projects in the region;
and
‘‘(8) cooperate with and assist State governments with economic development programs of participating States.
‘‘(e) ADMINISTRATION.—In carrying out subsection (d), the
Authority may—
‘‘(1) hold such hearings, sit and act at such times and
places, take such testimony, receive such evidence, and print
or otherwise reproduce and distribute a description of the proceedings and reports on actions by the Authority as the
Authority considers appropriate;
‘‘(2) authorize, through the Federal, State, or tribal cochairperson or any other member of the Authority designated by
the Authority, the administration of oaths if the Authority
determines that testimony should be taken or evidence received
under oath;
‘‘(3) request from any Federal, State, tribal, or local agency
such information as may be available to or procurable by the
agency that may be of use to the Authority in carrying out
the duties of the Authority;
‘‘(4) adopt, amend, and repeal bylaws and rules governing
the conduct of business and the performance of duties of the
Authority;
‘‘(5) request the head of any Federal agency to detail to
the Authority such personnel as the Authority requires to carry
out duties of the Authority, each such detail to be without
loss of seniority, pay, or other employee status;
‘‘(6) request the head of any State agency, tribal government, or local government to detail to the Authority such personnel as the Authority requires to carry out duties of the
Authority, each such detail to be without loss of seniority,
pay, or other employee status;
‘‘(7) provide for coverage of Authority employees in a suitable retirement and employee benefit system by—
‘‘(A) making arrangements or entering into contracts
with any participating State government or tribal government; or
‘‘(B) otherwise providing retirement and other
employee benefit coverage;
‘‘(8) accept, use, and dispose of gifts or donations of services
or real, personal, tangible, or intangible property;
‘‘(9) enter into and perform such contracts, leases, cooperative agreements, or other transactions as are necessary to carry

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PUBLIC LAW 107–171—MAY 13, 2002
out Authority duties, including any contracts, leases, or cooperative agreements with—
‘‘(A) any department, agency, or instrumentality of the
United States;
‘‘(B) any State (including a political subdivision,
agency, or instrumentality of the State);
‘‘(C) any Indian tribe in the region; or
‘‘(D) any person, firm, association, or corporation; and
‘‘(10) establish and maintain a central office and field offices
at such locations as the Authority may select.
‘‘(f) FEDERAL AGENCY COOPERATION.—A Federal agency shall—
‘‘(1) cooperate with the Authority; and
‘‘(2) provide, on request of the Federal cochairperson, appropriate assistance in carrying out this subtitle, in accordance
with applicable Federal laws (including regulations).
‘‘(g) ADMINISTRATIVE EXPENSES.—
‘‘(1) FEDERAL SHARE.—The Federal share of the administrative expenses of the Authority shall be—
‘‘(A) for fiscal year 2002, 100 percent;
‘‘(B) for fiscal year 2003, 75 percent; and
‘‘(C) for fiscal year 2004 and each fiscal year thereafter,
50 percent.
‘‘(2) NON-FEDERAL SHARE.—
‘‘(A) IN GENERAL.—The non-Federal share of the
administrative expenses of the Authority shall be paid
by non-Federal sources in the States that participate in
the Authority.
‘‘(B) SHARE PAID BY EACH STATE.—The share of
administrative expenses of the Authority to be paid by
non-Federal sources in each State shall be determined by
the Authority.
‘‘(C) NO FEDERAL PARTICIPATION.—The Federal cochairperson shall not participate or vote in any decision under
subparagraph (B).
‘‘(D) DELINQUENT STATES.—If a State is delinquent in
payment of the State’s share of administrative expenses
of the Authority under this subsection—
‘‘(i) no assistance under this subtitle shall be provided to the State (including assistance to a political
subdivision or a resident of the State); and
‘‘(ii) no member of the Authority from the State
shall participate or vote in any action by the Authority.
‘‘(h) COMPENSATION.—
‘‘(1) FEDERAL AND TRIBAL COCHAIRPERSONS.—The Federal
cochairperson and the tribal cochairperson shall be compensated by the Federal Government at the annual rate of
basic pay prescribed for level III of the Executive Schedule
in subchapter II of chapter 53 of title 5, United States Code.
‘‘(2) ALTERNATE FEDERAL AND TRIBAL COCHAIRPERSONS.—
The alternate Federal cochairperson and the alternate tribal
cochairperson—
‘‘(A) shall be compensated by the Federal Government
at the annual rate of basic pay prescribed for level V
of the Executive Schedule described in paragraph (1); and
‘‘(B) when not actively serving as an alternate, shall
perform such functions and duties as are delegated by

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the Federal cochairperson or the tribal cochairperson,
respectively.
‘‘(3) STATE MEMBERS AND ALTERNATES.—
‘‘(A) IN GENERAL.—A State shall compensate each
member and alternate representing the State on the
Authority at the rate established by State law.
‘‘(B) NO ADDITIONAL COMPENSATION.—No State member
or alternate member shall receive any salary, or any contribution to or supplementation of salary from any source
other than the State for services provided by the member
or alternate member to the Authority.
‘‘(4) DETAILED EMPLOYEES.—
‘‘(A) IN GENERAL.—No person detailed to serve the
Authority under subsection (e)(6) shall receive any salary
or any contribution to or supplementation of salary for
services provided to the Authority from—
‘‘(i) any source other than the State, tribal, local,
or intergovernmental agency from which the person
was detailed; or
‘‘(ii) the Authority.
‘‘(B) VIOLATION.—Any person that violates this paragraph shall be fined not more than $5,000, imprisoned
not more than 1 year, or both.
‘‘(C) APPLICABLE LAW.—The Federal cochairperson, the
alternate Federal cochairperson, and any Federal officer
or employee detailed to duty on the Authority under subsection (e)(5) shall not be subject to subparagraph (A),
but shall remain subject to sections 202 through 209 of
title 18, United States Code.
‘‘(5) ADDITIONAL PERSONNEL.—
‘‘(A) COMPENSATION.—
‘‘(i) IN GENERAL.—The Authority may appoint and
fix the compensation of an executive director and such
other personnel as are necessary to enable the
Authority to carry out the duties of the Authority.
‘‘(ii) EXCEPTION.—Compensation under clause (i)
shall not exceed the maximum rate for the Senior
Executive Service under section 5382 of title 5, United
States Code, including any applicable locality-based
comparability payment that may be authorized under
section 5304(h)(2)(C) of that title.
‘‘(B) EXECUTIVE DIRECTOR.—The executive director
shall be responsible for—
‘‘(i) the carrying out of the administrative duties
of the Authority;
‘‘(ii) direction of the Authority staff; and
‘‘(iii) such other duties as the Authority may
assign.
‘‘(C) NO FEDERAL EMPLOYEE STATUS.—No member,
alternate, officer, or employee of the Authority (except the
Federal cochairperson of the Authority, the alternate and
staff for the Federal cochairperson, and any Federal
employee detailed to the Authority under subsection (e)(5))
shall be considered to be a Federal employee for any purpose.
‘‘(i) CONFLICTS OF INTEREST.—

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‘‘(1) IN GENERAL.—Except as provided under paragraph
(2), no State member, Indian tribe member, State alternate,
officer, or employee of the Authority shall participate personally
and substantially as a member, alternate, officer, or employee
of the Authority, through decision, approval, disapproval, recommendation, the rendering of advice, investigation, or otherwise, in any proceeding, application, request for a ruling or
other determination, contract, claim, controversy, or other
matter in which, to knowledge of the member, alternate, officer,
or employee—
‘‘(A) the member, alternate, officer, or employee;
‘‘(B) the spouse, minor child, partner, or organization
(other than a State or political subdivision of the State
or the Indian tribe) of the member, alternate, officer, or
employee, in which the member, alternate, officer, or
employee is serving as officer, director, trustee, partner,
or employee; or
‘‘(C) any person or organization with whom the
member, alternate, officer, or employee is negotiating or
has any arrangement concerning prospective employment;
has a financial interest.
‘‘(2) DISCLOSURE.—Paragraph (1) shall not apply if the
State member, Indian tribe member, alternate, officer, or
employee—
‘‘(A) immediately advises the Authority of the nature
and circumstances of the proceeding, application, request
for a ruling or other determination, contract, claim, controversy, or other particular matter presenting a potential
conflict of interest;
‘‘(B) makes full disclosure of the financial interest;
and
‘‘(C) before the proceeding concerning the matter presenting the conflict of interest, receives a written determination by the Authority that the interest is not so
substantial as to be likely to affect the integrity of the
services that the Authority may expect from the State
member, Indian tribe member, alternate, officer, or
employee.
‘‘(3) VIOLATION.—Any person that violates this subsection
shall be fined not more than $10,000, imprisoned not more
than 2 years, or both.
‘‘(j) VALIDITY OF CONTRACTS, LOANS, AND GRANTS.—The
Authority may declare void any contract, loan, or grant of or by
the Authority in relation to which the Authority determines that
there has been a violation of any provision under subsection (h)(4)
or subsection (i) of this subtitle, or sections 202 through 209 of
title 18, United States Code.
7 USC 2009bb–2.

‘‘SEC. 383C. ECONOMIC AND COMMUNITY DEVELOPMENT GRANTS.

‘‘(a) IN GENERAL.—The Authority may approve grants to States,
Indian tribes, local governments, and public and nonprofit organizations for projects, approved in accordance with section 383I—
‘‘(1) to develop the transportation and telecommunication
infrastructure of the region for the purpose of facilitating economic development in the region (except that grants for this
purpose may be made only to States, Indian tribes, local governments, and nonprofit organizations);

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‘‘(2) to assist the region in obtaining the job training,
employment-related education, and business development (with
an emphasis on entrepreneurship) that are needed to build
and maintain strong local economies;
‘‘(3) to provide assistance to severely distressed and underdeveloped areas that lack financial resources for improving
basic public services;
‘‘(4) to provide assistance to severely distressed and underdeveloped areas that lack financial resources for equipping
industrial parks and related facilities; and
‘‘(5) to otherwise achieve the purposes of this subtitle.
‘‘(b) FUNDING.—
‘‘(1) IN GENERAL.—Funds for grants under subsection (a)
may be provided—
‘‘(A) entirely from appropriations to carry out this section;
‘‘(B) in combination with funds available under another
Federal grant program; or
‘‘(C) from any other source.
‘‘(2) PRIORITY OF FUNDING.—To best build the foundations
for long-term economic development and to complement other
Federal, State, and tribal resources in the region, Federal funds
available under this subtitle shall be focused on the activities
in the following order or priority:
‘‘(A) Basic public infrastructure in distressed counties
and isolated areas of distress.
‘‘(B) Transportation and telecommunication infrastructure for the purpose of facilitating economic development
in the region.
‘‘(C) Business development, with emphasis on
entrepreneurship.
‘‘(D) Job training or employment-related education,
with emphasis on use of existing public educational institutions located in the region.
‘‘SEC. 383D. SUPPLEMENTS TO FEDERAL GRANT PROGRAMS.

7 USC 2009bb–3.

‘‘(a) FINDING.—Congress finds that certain States and local
communities of the region, including local development districts,
may be unable to take maximum advantage of Federal grant programs for which the States and communities are eligible because—
‘‘(1) they lack the economic resources to provide the
required matching share; or
‘‘(2) there are insufficient funds available under the
applicable Federal law authorizing the Federal grant program
to meet pressing needs of the region.
‘‘(b) FEDERAL GRANT PROGRAM FUNDING.—Notwithstanding any
provision of law limiting the Federal share, the areas eligible for
assistance, or the authorizations of appropriations, under any Federal grant program, and in accordance with subsection (c), the
Authority, with the approval of the Federal cochairperson and with
respect to a project to be carried out in the region—
‘‘(1) may increase the Federal share of the costs of a project
under any Federal grant program to not more than 90 percent
(except as provided in section 383F(b)); and
‘‘(2) shall use amounts made available to carry out this
subtitle to pay the increased Federal share.
‘‘(c) CERTIFICATIONS.—

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‘‘(1) IN GENERAL.—In the case of any project for which
all or any portion of the basic Federal share of the costs
of the project is proposed to be paid under this section, no
Federal contribution shall be made until the Federal official
administering the Federal law that authorizes the Federal
grant program certifies that the project—
‘‘(A) meets (except as provided in subsection (b)) the
applicable requirements of the applicable Federal grant
program; and
‘‘(B) could be approved for Federal contribution under
the Federal grant program if funds were available under
the law for the project.
‘‘(2) CERTIFICATION BY AUTHORITY.—
‘‘(A) IN GENERAL.—The certifications and determinations required to be made by the Authority for approval
of projects under this Act in accordance with section 383I—
‘‘(i) shall be controlling; and
‘‘(ii) shall be accepted by the Federal agencies.
‘‘(B) ACCEPTANCE BY FEDERAL COCHAIRPERSON.—In the
case of any project described in paragraph (1), any finding,
report, certification, or documentation required to be submitted with respect to the project to the head of the department, agency, or instrumentality of the Federal Government responsible for the administration of the Federal
grant program under which the project is carried out shall
be accepted by the Federal cochairperson.

7 USC 2009bb–4.

‘‘SEC. 383E. LOCAL DEVELOPMENT DISTRICTS AND ORGANIZATIONS
AND NORTHERN GREAT PLAINS INC.

‘‘(a) DEFINITION OF LOCAL DEVELOPMENT DISTRICT.—In this
section, the term ‘local development district’ means an entity—
‘‘(1) that—
‘‘(A) is a planning district in existence on the date
of enactment of this subtitle that is recognized by the
Economic Development Administration of the Department
of Commerce; or
‘‘(B) is—
‘‘(i) organized and operated in a manner that
ensures broad-based community participation and an
effective opportunity for other nonprofit groups to contribute to the development and implementation of programs in the region;
‘‘(ii) governed by a policy board with at least a
simple majority of members consisting of—
‘‘(I) elected officials or employees of a general
purpose unit of local government who have been
appointed to represent the government; or
‘‘(II) individuals appointed by the general purpose unit of local government to represent the
government;
‘‘(iii) certified to the Authority as having a charter
or authority that includes the economic development
of counties or parts of counties or other political subdivisions within the region—
‘‘(I) by the Governor of each State in which
the entity is located; or

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‘‘(II) by the State officer designated by the
appropriate State law to make the certification;
and
‘‘(iv)(I) a nonprofit incorporated body organized or
chartered under the law of the State in which the
entity is located;
‘‘(II) a nonprofit agency or instrumentality of a
State or local government;
‘‘(III) a public organization established before the
date of enactment of this subtitle under State law
for creation of multi-jurisdictional, area-wide planning
organizations; or
‘‘(IV) a nonprofit association or combination of
bodies, agencies, and instrumentalities described in
subclauses (I) through (III); and
‘‘(2) that has not, as certified by the Federal
cochairperson—
‘‘(A) inappropriately used Federal grant funds from
any Federal source; or
‘‘(B) appointed an officer who, during the period in
which another entity inappropriately used Federal grant
funds from any Federal source, was an officer of the other
entity.
‘‘(b) GRANTS TO LOCAL DEVELOPMENT DISTRICTS.—
‘‘(1) IN GENERAL.—The Authority may make grants for
administrative expenses under this section.
‘‘(2) CONDITIONS FOR GRANTS.—
‘‘(A) MAXIMUM AMOUNT.—The amount of any grant
awarded under paragraph (1) shall not exceed 80 percent
of the administrative expenses of the local development
district receiving the grant.
‘‘(B) MAXIMUM PERIOD.—No grant described in paragraph (1) shall be awarded to a State agency certified
as a local development district for a period greater than
3 years.
‘‘(C) LOCAL SHARE.—The contributions of a local
development district for administrative expenses may be
in cash or in kind, fairly evaluated, including space, equipment, and services.
‘‘(c) DUTIES OF LOCAL DEVELOPMENT DISTRICTS.—A local
development district shall—
‘‘(1) operate as a lead organization serving multicounty
areas in the region at the local level; and
‘‘(2) serve as a liaison between State, tribal, and local
governments, nonprofit organizations (including communitybased groups and educational institutions), the business
community, and citizens that—
‘‘(A) are involved in multijurisdictional planning;
‘‘(B) provide technical assistance to local jurisdictions
and potential grantees; and
‘‘(C) provide leadership and civic development assistance.
‘‘(d) NORTHERN GREAT PLAINS INC.—Northern Great Plains Inc.,
a nonprofit corporation incorporated in the State of Minnesota
to implement the recommendations of the Northern Great Plains
Rural Development Commission established by the Northern Great

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Plains Rural Development Act (7 U.S.C. 2661 note; Public Law
103–318)—
‘‘(1) shall serve as an independent, primary resource for
the Authority on issues of concern to the region;
‘‘(2) shall advise the Authority on development of international trade;
‘‘(3) may provide research, education, training, and other
support to the Authority; and
‘‘(4) may carry out other activities on its own behalf or
on behalf of other entities.

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7 USC 2009bb–5.

‘‘SEC. 383F. DISTRESSED COUNTIES AND AREAS AND NONDISTRESSED
COUNTIES.

Deadline.

‘‘(a) DESIGNATIONS.—Not later than 90 days after the date
of enactment of this subtitle, and annually thereafter, the Authority,
in accordance with such criteria as the Authority may establish,
shall designate—
‘‘(1) as distressed counties, counties in the region that
are the most severely and persistently distressed and underdeveloped and have high rates of poverty, unemployment, or
outmigration;
‘‘(2) as nondistressed counties, counties in the region that
are not designated as distressed counties under paragraph (1);
and
‘‘(3) as isolated areas of distress, areas located in nondistressed counties (as designated under paragraph (2)) that have
high rates of poverty, unemployment, or outmigration.
‘‘(b) DISTRESSED COUNTIES.—
‘‘(1) IN GENERAL.—The Authority shall allocate at least
75 percent of the appropriations made available under section
383M for programs and projects designed to serve the needs
of distressed counties and isolated areas of distress in the
region.
‘‘(2) FUNDING LIMITATIONS.—The funding limitations under
section 383D(b) shall not apply to a project to provide transportation or telecommunication or basic public services to residents
of 1 or more distressed counties or isolated areas of distress
in the region.
‘‘(c) NONDISTRESSED COUNTIES.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
no funds shall be provided under this subtitle for a project
located in a county designated as a nondistressed county under
subsection (a)(2).
‘‘(2) EXCEPTIONS.—
‘‘(A) IN GENERAL.—The funding prohibition under paragraph (1) shall not apply to grants to fund the administrative expenses of local development districts under section
383E(b).
‘‘(B) MULTICOUNTY PROJECTS.—The Authority may
waive the application of the funding prohibition under paragraph (1) to—
‘‘(i) a multicounty project that includes participation by a nondistressed county; or
‘‘(ii) any other type of project;
if the Authority determines that the project could bring
significant benefits to areas of the region outside a nondistressed county.

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‘‘(C) ISOLATED AREAS OF DISTRESS.—For a designation
of an isolated area of distress for assistance to be effective,
the designation shall be supported—
‘‘(i) by the most recent Federal data available;
or
‘‘(ii) if no recent Federal data are available, by
the most recent data available through the government
of the State in which the isolated area of distress
is located.
‘‘(d) TRANSPORTATION, TELECOMMUNICATION, AND BASIC PUBLIC
INFRASTRUCTURE.—The Authority shall allocate at least 50 percent
of any funds made available under section 383M for transportation,
telecommunication, and basic public infrastructure projects authorized under paragraphs (1) and (3) of section 383C(a).
‘‘SEC. 383G. DEVELOPMENT PLANNING PROCESS.

7 USC 2009bb–6.

‘‘(a) STATE DEVELOPMENT PLAN.—In accordance with policies
established by the Authority, each State member shall submit a
development plan for the area of the region represented by the
State member.
‘‘(b) CONTENT OF PLAN.—A State development plan submitted
under subsection (a) shall reflect the goals, objectives, and priorities
identified in the regional development plan developed under section
383B(d)(2).
‘‘(c) CONSULTATION WITH INTERESTED LOCAL PARTIES.—In carrying out the development planning process (including the selection
of programs and projects for assistance), a State may—
‘‘(1) consult with—
‘‘(A) local development districts; and
‘‘(B) local units of government; and
‘‘(2) take into consideration the goals, objectives, priorities,
and recommendations of the entities described in paragraph
(1).
‘‘(d) PUBLIC PARTICIPATION.—
‘‘(1) IN GENERAL.—The Authority and applicable State and
local development districts shall encourage and assist, to the
maximum extent practicable, public participation in the
development, revision, and implementation of all plans and
programs under this subtitle.
‘‘(2) REGULATIONS.—The Authority shall develop guidelines
for providing public participation described in paragraph (1),
including public hearings.
‘‘SEC. 383H. PROGRAM DEVELOPMENT CRITERIA.

7 USC 2009bb–7.

‘‘(a) IN GENERAL.—In considering programs and projects to
be provided assistance under this subtitle, and in establishing a
priority ranking of the requests for assistance provided to the
Authority, the Authority shall follow procedures that ensure, to
the maximum extent practicable, consideration of—
‘‘(1) the relationship of the project or class of projects to
overall regional development;
‘‘(2) the per capita income and poverty and unemployment
and outmigration rates in an area;
‘‘(3) the financial resources available to the applicants for
assistance seeking to carry out the project, with emphasis on
ensuring that projects are adequately financed to maximize
the probability of successful economic development;

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‘‘(4) the importance of the project or class of projects in
relation to other projects or classes of projects that may be
in competition for the same funds;
‘‘(5) the prospects that the project for which assistance
is sought will improve, on a continuing rather than a temporary
basis, the opportunities for employment, the average level of
income, or the economic development of the area to be served
by the project; and
‘‘(6) the extent to which the project design provides for
detailed outcome measurements by which grant expenditures
and the results of the expenditures may be evaluated.
‘‘(b) NO RELOCATION ASSISTANCE.—No financial assistance
authorized by this subtitle shall be used to assist a person or
entity in relocating from one area to another, except that financial
assistance may be used as otherwise authorized by this title to
attract businesses from outside the region to the region.
‘‘(c) MAINTENANCE OF EFFORT.—Funds may be provided for
a program or project in a State under this subtitle only if the
Authority determines that the level of Federal or State financial
assistance provided under a law other than this subtitle, for the
same type of program or project in the same area of the State
within the region, will not be reduced as a result of funds made
available by this subtitle.
7 USC 2009bb–8.

‘‘SEC. 383I. APPROVAL OF DEVELOPMENT PLANS AND PROJECTS.

‘‘(a) IN GENERAL.—A State or regional development plan or
any multistate subregional plan that is proposed for development
under this subtitle shall be reviewed by the Authority.
‘‘(b) EVALUATION BY STATE MEMBER.—An application for a grant
or any other assistance for a project under this subtitle shall be
made through and evaluated for approval by the State member
of the Authority representing the applicant.
‘‘(c) CERTIFICATION.—An application for a grant or other assistance for a project shall be approved only on certification by the
State member that the application for the project—
‘‘(1) describes ways in which the project complies with
any applicable State development plan;
‘‘(2) meets applicable criteria under section 383H;
‘‘(3) provides adequate assurance that the proposed project
will be properly administered, operated, and maintained; and
‘‘(4) otherwise meets the requirements of this subtitle.
‘‘(d) VOTES FOR DECISIONS.—On certification by a State member
of the Authority of an application for a grant or other assistance
for a specific project under this section, an affirmative vote of
the Authority under section 383B(c) shall be required for approval
of the application.
7 USC 2009bb–9.

‘‘SEC. 383J. CONSENT OF STATES.

‘‘Nothing in this subtitle requires any State to engage in or
accept any program under this subtitle without the consent of
the State.
7 USC
2009bb–10.

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‘‘SEC. 383K. RECORDS.

‘‘(a) RECORDS OF THE AUTHORITY.—
‘‘(1) IN GENERAL.—The Authority shall maintain accurate
and complete records of all transactions and activities of the
Authority.

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‘‘(2) AVAILABILITY.—All records of the Authority shall be
available for audit and examination by the Comptroller General
of the United States and the Inspector General of the Department of Agriculture (including authorized representatives of
the Comptroller General and the Inspector General of the
Department of Agriculture).
‘‘(b) RECORDS OF RECIPIENTS OF FEDERAL ASSISTANCE.—
‘‘(1) IN GENERAL.—A recipient of Federal funds under this
subtitle shall, as required by the Authority, maintain accurate
and complete records of transactions and activities financed
with Federal funds and report to the Authority on the transactions and activities to the Authority.
‘‘(2) AVAILABILITY.—All records required under paragraph
(1) shall be available for audit by the Comptroller General
of the United States, the Inspector General of the Department
of Agriculture, and the Authority (including authorized representatives of the Comptroller General, the Inspector General
of the Department of Agriculture, and the Authority).
‘‘(c) ANNUAL AUDIT.—The Inspector General of the Department
of Agriculture shall audit the activities, transactions, and records
of the Authority on an annual basis.
‘‘SEC. 383L. ANNUAL REPORT.

‘‘Not later than 180 days after the end of each fiscal year,
the Authority shall submit to the President and to Congress a
report describing the activities carried out under this subtitle.
‘‘SEC. 383M. AUTHORIZATION OF APPROPRIATIONS.

‘‘(a) IN GENERAL.—There is authorized to be appropriated to
the Authority to carry out this subtitle $30,000,000 for each of
fiscal years 2002 through 2007, to remain available until expended.
‘‘(b) ADMINISTRATIVE EXPENSES.—Not more than 5 percent of
the amount appropriated under subsection (a) for a fiscal year
shall be used for administrative expenses of the Authority.
‘‘(c) MINIMUM STATE SHARE OF GRANTS.—Notwithstanding any
other provision of this subtitle, for any fiscal year, the aggregate
amount of grants received by a State and all persons or entities
in the State under this subtitle shall be not less than 1⁄3 of the
product obtained by multiplying—
‘‘(1) the aggregate amount of grants under this subtitle
for the fiscal year; and
‘‘(2) the ratio that—
‘‘(A) the population of the State (as determined by
the Secretary of Commerce based on the most recent decennial census for which data are available); bears to
‘‘(B) the population of the region (as so determined).
‘‘SEC. 383N. TERMINATION OF AUTHORITY.

‘‘The authority provided by this subtitle terminates effective
October 1, 2007.’’.

Deadline.
7 USC
2009bb–11.

7 USC
2009bb–12.

7 USC
2009bb–13.

SEC. 6029. RURAL BUSINESS INVESTMENT PROGRAM.

The Consolidated Farm and Rural Development Act (as
amended by section 6028) is amended by adding at the end the
following:

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‘‘Subtitle H—Rural Business Investment
Program
7 USC 2009cc.

‘‘SEC. 384A. DEFINITIONS.

‘‘In this subtitle:
‘‘(1) ARTICLES.—The term ‘articles’ means articles of incorporation for an incorporated body or the functional equivalent
or other similar documents specified by the Secretary for other
business entities.
‘‘(2) DEVELOPMENTAL VENTURE CAPITAL.—The term
‘developmental venture capital’ means capital in the form of
equity capital investments in rural business investment companies with an objective of fostering economic development in
rural areas.
‘‘(3) EMPLOYEE WELFARE BENEFIT PLAN; PENSION PLAN.—
‘‘(A) IN GENERAL.—The terms ‘employee welfare benefit
plan’ and ‘pension plan’ have the meanings given the terms
in section 3 of the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1002).
‘‘(B) INCLUSIONS.—The terms ‘employee welfare benefit
plan’ and ‘pension plan’ include—
‘‘(i) public and private pension or retirement plans
subject to this subtitle; and
‘‘(ii) similar plans not covered by this subtitle that
have been established, and that are maintained, by
the Federal Government or any State (including by
a political subdivision, agency, or instrumentality of
the Federal Government or a State) for the benefit
of employees.
‘‘(4) EQUITY CAPITAL.—The term ‘equity capital’ means
common or preferred stock or a similar instrument, including
subordinated debt with equity features.
‘‘(5) LEVERAGE.—The term ‘leverage’ includes—
‘‘(A) debentures purchased or guaranteed by the Secretary;
‘‘(B) participating securities purchased or guaranteed
by the Secretary; and
‘‘(C) preferred securities outstanding as of the date
of enactment of this subtitle.
‘‘(6) LICENSE.—The term ‘license’ means a license issued
by the Secretary as provided in section 384D(e).
‘‘(7) LIMITED LIABILITY COMPANY.—The term ‘limited
liability company’ means a business entity that is organized
and operating in accordance with a State limited liability company law approved by the Secretary.
‘‘(8) MEMBER.—The term ‘member’ means, with respect to
a rural business investment company that is a limited liability
company, a holder of an ownership interest or a person otherwise admitted to membership in the limited liability company.
‘‘(9) OPERATIONAL ASSISTANCE.—The term ‘operational
assistance’ means management, marketing, and other technical
assistance that assists a rural business concern with business
development.
‘‘(10) PARTICIPATION AGREEMENT.—The term ‘participation
agreement’ means an agreement, between the Secretary and
a rural business investment company granted final approval

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under section 384D(e), that requires the rural business investment company to make investments in smaller enterprises
in rural areas.
‘‘(11) PRIVATE CAPITAL.—
‘‘(A) IN GENERAL.—The term ‘private capital’ means
the total of—
‘‘(i)(I) the paid-in capital and paid-in surplus of
a corporate rural business investment company;
‘‘(II) the contributed capital of the partners of a
partnership rural business investment company; or
‘‘(III) the equity investment of the members of
a limited liability company rural business investment
company; and
‘‘(ii) unfunded binding commitments from investors
that meet criteria established by the Secretary to contribute capital to the rural business investment company, except that—
‘‘(I) unfunded commitments may be counted
as private capital for purposes of approval by the
Secretary of any request for leverage; but
‘‘(II) leverage shall not be funded based on
the commitments.
‘‘(B) EXCLUSIONS.—The term ‘private capital’ does not
include—
‘‘(i) any funds borrowed by a rural business investment company from any source;
‘‘(ii) any funds obtained through the issuance of
leverage; or
‘‘(iii) any funds obtained directly or indirectly from
the Federal Government or any State (including by
a political subdivision, agency, or instrumentality of
the Federal Government or a State), except for—
‘‘(I) funds obtained from the business revenues
(excluding any governmental appropriation) of any
federally chartered or government-sponsored
enterprise established prior to the date of enactment of this subtitle;
‘‘(II) funds invested by an employee welfare
benefit plan or pension plan; and
‘‘(III) any qualified nonprivate funds (if the
investors of the qualified nonprivate funds do not
control, directly or indirectly, the management,
board of directors, general partners, or members
of the rural business investment company).
‘‘(12) QUALIFIED NONPRIVATE FUNDS.—The term ‘qualified
nonprivate funds’ means any—
‘‘(A) funds directly or indirectly invested in any
applicant or rural business investment company on or
before the date of enactment of this subtitle, by any Federal
agency, other than the Department of Agriculture, under
a provision of law explicitly mandating the inclusion of
those funds in the definition of the term ‘private capital’;
and
‘‘(B) funds invested in any applicant or rural business
investment company by 1 or more entities of any State
(including by a political subdivision, agency, or instrumentality of the State and including any guarantee extended

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PUBLIC LAW 107–171—MAY 13, 2002
by those entities) in an aggregate amount that does not
exceed 33 percent of the private capital of the applicant
or rural business investment company.
‘‘(13) RURAL BUSINESS CONCERN.—The term ‘rural business
concern’ means—
‘‘(A) a public, private, or cooperative for-profit or nonprofit organization;
‘‘(B) a for-profit or nonprofit business controlled by
an Indian tribe on a Federal or State reservation or other
federally recognized Indian tribal group; or
‘‘(C) any other person or entity;
that primarily operates in a rural area, as determined by the
Secretary.
‘‘(14) RURAL BUSINESS INVESTMENT COMPANY.—The term
‘rural business investment company’ means a company that—
‘‘(A) has been granted final approval by the Secretary
under section 384D(e); and
‘‘(B) has entered into a participation agreement with
the Secretary.
‘‘(15) SMALLER ENTERPRISE.—The term ‘smaller enterprise’
means any rural business concern that, together with its
affiliates—
‘‘(A) has—
‘‘(i) a net financial worth of not more than
$6,000,000, as of the date on which assistance is provided under this subtitle to the rural business concern;
and
‘‘(ii) an average net income for the 2-year period
preceding the date on which assistance is provided
under this subtitle to the rural business concern, of
not more than $2,000,000, after Federal income taxes
(excluding any carryover losses), except that, for purposes of this clause, if the rural business concern is
not required by law to pay Federal income taxes at
the enterprise level, but is required to pass income
through to the shareholders, partners, beneficiaries,
or other equitable owners of the business concern, the
net income of the business concern shall be determined
by allowing a deduction in an amount equal to the
total of—
‘‘(I) if the rural business concern is not
required by law to pay State (and local, if any)
income taxes at the enterprise level, the net income
(determined without regard to this clause), multiplied by the marginal State income tax rate (or
by the combined State and local income tax rates,
as applicable) that would have applied if the business concern were a corporation; and
‘‘(II) the net income (so determined) less any
deduction for State (and local) income taxes calculated under subclause (I), multiplied by the marginal Federal income tax rate that would have
applied if the rural business concern were a corporation; or
‘‘(B) satisfies the standard industrial classification size
standards established by the Administrator of the Small

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Business Administration for the industry in which the rural
business concern is primarily engaged.
‘‘SEC. 384B. PURPOSES.

7 USC 2009cc–1.

‘‘The purposes of the Rural Business Investment Program established under this subtitle are—
‘‘(1) to promote economic development and the creation
of wealth and job opportunities in rural areas and among
individuals living in those areas by encouraging developmental
venture capital investments in smaller enterprises primarily
located in rural areas; and
‘‘(2) to establish a developmental venture capital program,
with the mission of addressing the unmet equity investment
needs of small enterprises located in rural areas, by authorizing
the Secretary—
‘‘(A) to enter into participation agreements with rural
business investment companies;
‘‘(B) to guarantee debentures of rural business investment companies to enable each rural business investment
company to make developmental venture capital investments in smaller enterprises in rural areas; and
‘‘(C) to make grants to rural business investment
companies, and to other entities, for the purpose of providing operational assistance to smaller enterprises
financed, or expected to be financed, by rural business
investment companies.
‘‘SEC. 384C. ESTABLISHMENT.

7 USC 2009cc–2.

‘‘In accordance with this subtitle, the Secretary shall establish
a Rural Business Investment Program, under which the Secretary
may—
‘‘(1) enter into participation agreements with companies
granted final approval under section 384D(e) for the purposes
set forth in section 384B;
‘‘(2) guarantee the debentures issued by rural business
investment companies as provided in section 384E; and
‘‘(3) make grants to rural business investment companies,
and to other entities, under section 384H.
‘‘SEC. 384D. SELECTION OF RURAL BUSINESS INVESTMENT COMPANIES.

7 USC 2009cc–3.

‘‘(a) ELIGIBILITY.—A company shall be eligible to apply to
participate, as a rural business investment company, in the program
established under this subtitle if—
‘‘(1) the company is a newly formed for-profit entity or
a newly formed for-profit subsidiary of such an entity;
‘‘(2) the company has a management team with experience
in community development financing or relevant venture capital
financing; and
‘‘(3) the company will invest in enterprises that will create
wealth and job opportunities in rural areas, with an emphasis
on smaller enterprises.
‘‘(b) APPLICATION.—To participate, as a rural business investment company, in the program established under this subtitle,
a company meeting the eligibility requirements of subsection (a)
shall submit an application to the Secretary that includes—

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Deadline.
Reports.

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‘‘(1) a business plan describing how the company intends
to make successful developmental venture capital investments
in identified rural areas;
‘‘(2) information regarding the community development
finance or relevant venture capital qualifications and general
reputation of the management of the company;
‘‘(3) a description of how the company intends to work
with community-based organizations and local entities
(including local economic development companies, local lenders,
and local investors) and to seek to address the unmet equity
capital needs of the communities served;
‘‘(4) a proposal describing how the company intends to
use the grant funds provided under this subtitle to provide
operational assistance to smaller enterprises financed by the
company, including information regarding whether the company
intends to use licensed professionals, as necessary, on the staff
of the company or from an outside entity;
‘‘(5) with respect to binding commitments to be made to
the company under this subtitle, an estimate of the ratio of
cash to in-kind contributions;
‘‘(6) a description of the criteria to be used to evaluate
whether and to what extent the company meets the purposes
of the program established under this subtitle;
‘‘(7) information regarding the management and financial
strength of any parent firm, affiliated firm, or any other firm
essential to the success of the business plan of the company;
and
‘‘(8) such other information as the Secretary may require.
‘‘(c) STATUS.—Not later than 90 days after the initial receipt
by the Secretary of an application under this section, the Secretary
shall provide to the applicant a written report describing the status
of the application and any requirements remaining for completion
of the application.
‘‘(d) MATTERS CONSIDERED.—In reviewing and processing any
application under this section, the Secretary—
‘‘(1) shall determine whether—
‘‘(A) the applicant meets the requirements of subsection
(e); and
‘‘(B) the management of the applicant is qualified and
has the knowledge, experience, and capability necessary
to comply with this subtitle;
‘‘(2) shall take into consideration—
‘‘(A) the need for and availability of financing for rural
business concerns in the geographic area in which the
applicant is to commence business;
‘‘(B) the general business reputation of the owners
and management of the applicant; and
‘‘(C) the probability of successful operations of the
applicant, including adequate profitability and financial
soundness; and
‘‘(3) shall not take into consideration any projected shortage
or unavailability of grant funds or leverage.
‘‘(e) APPROVAL; LICENSE.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
the Secretary may approve an applicant to operate as a rural
business investment company under this subtitle and license
the applicant as a rural business investment company, if—

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‘‘(A) the Secretary determines that the application
satisfies the requirements of subsection (b);
‘‘(B) the area in which the rural business investment
company is to conduct its operations, and establishment
of branch offices or agencies (if authorized by the articles),
are approved by the Secretary; and
‘‘(C) the applicant enters into a participation agreement
with the Secretary.
‘‘(2) CAPITAL REQUIREMENTS.—
‘‘(A) IN GENERAL.—Notwithstanding any other provision of this subtitle, the Secretary may approve an
applicant to operate as a rural business investment company under this subtitle and designate the applicant as
a rural business investment company, if the Secretary
determines that the applicant—
‘‘(i) has private capital of more than $2,500,000;
‘‘(ii) would otherwise be approved under this subtitle, except that the applicant does not satisfy the
requirements of section 384I(c); and
‘‘(iii) has a viable business plan that—
‘‘(I) reasonably projects profitable operations;
and
‘‘(II) has a reasonable timetable for achieving
a level of private capital that satisfies the requirements of section 384I(c).
‘‘(B) LEVERAGE.—An applicant approved under
subparagraph (A) shall not be eligible to receive leverage
under this subtitle until the applicant satisfies the requirements of section 384I(c).
‘‘(C) GRANTS.—An applicant approved under subparagraph (A) shall be eligible for grants under section 384H
in proportion to the private capital of the applicant, as
determined by the Secretary.
‘‘SEC. 384E. DEBENTURES.

7 USC 2009cc–4.

‘‘(a) IN GENERAL.—The Secretary may guarantee the timely
payment of principal and interest, as scheduled, on debentures
issued by any rural business investment company.
‘‘(b) TERMS AND CONDITIONS.—The Secretary may make guarantees under this section on such terms and conditions as the Secretary considers appropriate, except that the term of any debenture
guaranteed under this section shall not exceed 15 years.
‘‘(c) FULL FAITH AND CREDIT OF THE UNITED STATES.—Section
381H(i) shall apply to any guarantee under this section.
‘‘(d) MAXIMUM GUARANTEE.—Under this section, the Secretary
may—
‘‘(1) guarantee the debentures issued by a rural business
investment company only to the extent that the total face
amount of outstanding guaranteed debentures of the rural business investment company does not exceed the lesser of—
‘‘(A) 300 percent of the private capital of the rural
business investment company; or
‘‘(B) $105,000,000; and
‘‘(2) provide for the use of discounted debentures.
‘‘SEC. 384F. ISSUANCE AND GUARANTEE OF TRUST CERTIFICATES.

Applicability.

7 USC 2009cc–5.

‘‘(a) ISSUANCE.—The Secretary may issue trust certificates representing ownership of all or a fractional part of debentures issued

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Applicability.

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by a rural business investment company and guaranteed by the
Secretary under this subtitle, if the certificates are based on and
backed by a trust or pool approved by the Secretary and composed
solely of guaranteed debentures.
‘‘(b) GUARANTEE.—
‘‘(1) IN GENERAL.—The Secretary may, under such terms
and conditions as the Secretary considers appropriate, guarantee the timely payment of the principal of and interest on
trust certificates issued by the Secretary or agents of the Secretary for purposes of this section.
‘‘(2) LIMITATION.—Each guarantee under this subsection
shall be limited to the extent of principal and interest on
the guaranteed debentures that compose the trust or pool.
‘‘(3) PREPAYMENT OR DEFAULT.—
‘‘(A) IN GENERAL.—In the event a debenture in a trust
or pool is prepaid, or in the event of default of such a
debenture, the guarantee of timely payment of principal
and interest on the trust certificates shall be reduced in
proportion to the amount of principal and interest the
prepaid debenture represents in the trust or pool.
‘‘(B) INTEREST.—Interest on prepaid or defaulted debentures shall accrue and be guaranteed by the Secretary
only through the date of payment of the guarantee.
‘‘(C) REDEMPTION.—At any time during its term, a
trust certificate may be called for redemption due to prepayment or default of all debentures.
‘‘(c) FULL FAITH AND CREDIT OF THE UNITED STATES.—Section
381H(i) shall apply to any guarantee of a trust certificate issued
by the Secretary under this section.
‘‘(d) SUBROGATION AND OWNERSHIP RIGHTS.—
‘‘(1) SUBROGATION.—If the Secretary pays a claim under
a guarantee issued under this section, the claim shall be subrogated fully to the rights satisfied by the payment.
‘‘(2) OWNERSHIP RIGHTS.—No Federal, State, or local law
shall preclude or limit the exercise by the Secretary of the
ownership rights of the Secretary in a debenture residing in
a trust or pool against which 1 or more trust certificates are
issued under this section.
‘‘(e) MANAGEMENT AND ADMINISTRATION.—
‘‘(1) REGISTRATION.—The Secretary shall provide for a central registration of all trust certificates issued under this section.
‘‘(2) CREATION OF POOLS.—The Secretary may—
‘‘(A) maintain such commercial bank accounts or
investments in obligations of the United States as may
be necessary to facilitate the creation of trusts or pools
backed by debentures guaranteed under this subtitle; and
‘‘(B) issue trust certificates to facilitate the creation
of those trusts or pools.
‘‘(3) FIDELITY BOND OR INSURANCE REQUIREMENT.—Any
agent performing functions on behalf of the Secretary under
this paragraph shall provide a fidelity bond or insurance in
such amount as the Secretary considers to be necessary to
fully protect the interests of the United States.
‘‘(4) REGULATION OF BROKERS AND DEALERS.—The Secretary
may regulate brokers and dealers in trust certificates issued
under this section.

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‘‘(5) ELECTRONIC REGISTRATION.—Nothing in this subsection
prohibits the use of a book-entry or other electronic form of
registration for trust certificates issued under this section.
‘‘SEC. 384G. FEES.

7 USC 2009cc–6.

‘‘(a) IN GENERAL.—The Secretary may charge such fees as the
Secretary considers appropriate with respect to any guarantee or
grant issued under this subtitle.
‘‘(b) TRUST CERTIFICATE.—Notwithstanding subsection (a), the
Secretary shall not collect a fee for any guarantee of a trust certificate under section 384F, except that any agent of the Secretary
may collect a fee approved by the Secretary for the functions
described in section 384F(e)(2).
‘‘(c) LICENSE.—
‘‘(1) IN GENERAL.—The Secretary may prescribe fees to
be paid by each applicant for a license to operate as a rural
business investment company under this subtitle.
‘‘(2) USE OF AMOUNTS.—Fees collected under this
subsection—
‘‘(A) shall be deposited in the account for salaries and
expenses of the Secretary; and
‘‘(B) are authorized to be appropriated solely to cover
the costs of licensing examinations.
‘‘SEC. 384H. OPERATIONAL ASSISTANCE GRANTS.

7 USC 2009cc–7.

‘‘(a) IN GENERAL.—In accordance with this section, the Secretary may make grants to rural business investment companies
and to other entities, as authorized by this subtitle, to provide
operational assistance to smaller enterprises financed, or expected
to be financed, by the entities.
‘‘(b) TERMS.—Grants made under this section shall be made
over a multiyear period (not to exceed 10 years) under such terms
as the Secretary may require.
‘‘(c) USE OF FUNDS.—The proceeds of a grant made under
this section may be used by the rural business investment company
receiving the grant only to provide operational assistance in connection with an equity or prospective equity investment in a business
located in a rural area.
‘‘(d) SUBMISSION OF PLANS.—A rural business investment company shall be eligible for a grant under this section only if the
rural business investment company submits to the Secretary, in
such form and manner as the Secretary may require, a plan for
use of the grant.
‘‘(e) GRANT AMOUNT.—
‘‘(1) RURAL BUSINESS INVESTMENT COMPANIES.—The amount
of a grant made under this section to a rural business investment company shall be equal to the lesser of—
‘‘(A) 10 percent of the private capital raised by the
rural business investment company; or
‘‘(B) $1,000,000.
‘‘(2) OTHER ENTITIES.—The amount of a grant made under
this section to any entity other than a rural business investment
company shall be equal to the resources (in cash or in kind)
raised by the entity in accordance with the requirements
applicable to rural business investment companies under this
subtitle.

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116 STAT. 396
7 USC 2009cc–8.

PUBLIC LAW 107–171—MAY 13, 2002

‘‘SEC. 384I. RURAL BUSINESS INVESTMENT COMPANIES.

‘‘(a) ORGANIZATION.—For the purpose of this subtitle, a rural
business investment company shall—
‘‘(1) be an incorporated body, a limited liability company,
or a limited partnership organized and chartered or otherwise
existing under State law solely for the purpose of performing
the functions and conducting the activities authorized by this
subtitle;
‘‘(2)(A) if incorporated, have succession for a period of not
less than 30 years unless earlier dissolved by the shareholders
of the rural business investment company; and
‘‘(B) if a limited partnership or a limited liability company,
have succession for a period of not less than 10 years; and
‘‘(3) possess the powers reasonably necessary to perform
the functions and conduct the activities.
‘‘(b) ARTICLES.—The articles of any rural business investment
company—
‘‘(1) shall specify in general terms—
‘‘(A) the purposes for which the rural business investment company is formed;
‘‘(B) the name of the rural business investment company;
‘‘(C) the area or areas in which the operations of the
rural business investment company are to be carried out;
‘‘(D) the place where the principal office of the rural
business investment company is to be located; and
‘‘(E) the amount and classes of the shares of capital
stock of the rural business investment company;
‘‘(2) may contain any other provisions consistent with this
subtitle that the rural business investment company may determine appropriate to adopt for the regulation of the business
of the rural business investment company and the conduct
of the affairs of the rural business investment company; and
‘‘(3) shall be subject to the approval of the Secretary.
‘‘(c) CAPITAL REQUIREMENTS.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
the private capital of each rural business investment company
shall be not less than—
‘‘(A) $5,000,000; or
‘‘(B) $10,000,000, with respect to each rural business
investment company authorized or seeking authority to
issue participating securities to be purchased or guaranteed
by the Secretary under this subtitle.
‘‘(2) EXCEPTION.—The Secretary may, in the discretion of
the Secretary and based on a showing of special circumstances
and good cause, permit the private capital of a rural business
investment company described in paragraph (1)(B) to be less
than $10,000,000, but not less than $5,000,000, if the Secretary
determines that the action would not create or otherwise contribute to an unreasonable risk of default or loss to the Federal
Government.
‘‘(3) ADEQUACY.—In addition to the requirements of paragraph (1), the Secretary shall—
‘‘(A) determine whether the private capital of each
rural business investment company is adequate to ensure
a reasonable prospect that the rural business investment

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company will be operated soundly and profitably, and managed actively and prudently in accordance with the articles
of the rural business investment company;
‘‘(B) determine that the rural business investment company will be able to comply with the requirements of this
subtitle;
‘‘(C) require that at least 75 percent of the capital
of each rural business investment company is invested
in rural business concerns and not more than 10 percent
of the investments shall be made in an area containing
a city of over 150,000 in the last decennial census and
the Census Bureau defined urbanized area containing or
adjacent to that city;
‘‘(D) ensure that the rural business investment company is designed primarily to meet equity capital needs
of the businesses in which the rural business investment
company invests and not to compete with traditional small
business financing by commercial lenders; and
‘‘(E) require that the rural business investment company makes short-term non-equity investments of less than
5 years only to the extent necessary to preserve an existing
investment.
‘‘(d) DIVERSIFICATION OF OWNERSHIP.—The Secretary shall
ensure that the management of each rural business investment
company licensed after the date of enactment of this subtitle is
sufficiently diversified from and unaffiliated with the ownership
of the rural business investment company so as to ensure independence and objectivity in the financial management and oversight
of the investments and operations of the rural business investment
company.
‘‘SEC. 384J. FINANCIAL INSTITUTION INVESTMENTS.

7 USC 2009cc–9.

‘‘(a) IN GENERAL.—Except as otherwise provided in this section
and notwithstanding any other provision of law, the following banks,
associations, and institutions are eligible both to establish and
invest in any rural business investment company or in any entity
established to invest solely in rural business investment companies:
‘‘(1) Any bank or savings association the deposits of which
are insured under the Federal Deposit Insurance Act (12 U.S.C.
1811 et seq.).
‘‘(2) Any Farm Credit System institution described in section 1.2(a) of the Farm Credit Act of 1971 (12 U.S.C. 2002(a)).
‘‘(b) LIMITATION.—No bank, association, or institution described
in subsection (a) may make investments described in subsection
(a) that are greater than 5 percent of the capital and surplus
of the bank, association, or institution.
‘‘(c) LIMITATION ON RURAL BUSINESS INVESTMENT COMPANIES
CONTROLLED BY FARM CREDIT SYSTEM INSTITUTIONS.—If a Farm
Credit System institution described in section 1.2(a) of the Farm
Credit Act of 1971 (12 U.S.C. 2002(a)) holds more than 15 percent
of the shares of a rural business investment company, either alone
or in conjunction with other System institutions (or affiliates), the
rural business investment company shall not provide equity investments in, or provide other financial assistance to, entities that
are not otherwise eligible to receive financing from the Farm Credit
System under that Act (12 U.S.C. 2001 et seq.).

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116 STAT. 398
7 USC
2009cc–10.

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‘‘SEC. 384K. REPORTING REQUIREMENTS.

‘‘(a) RURAL BUSINESS INVESTMENT COMPANIES.—Each rural
business investment company that participates in the program
established under this subtitle shall provide to the Secretary such
information as the Secretary may require, including—
‘‘(1) information relating to the measurement criteria that
the rural business investment company proposed in the program application of the rural business investment company;
and
‘‘(2) in each case in which the rural business investment
company under this subtitle makes an investment in, or a
loan or grant to, a business that is not located in a rural
area, a report on the number and percentage of employees
of the business who reside in those areas.
‘‘(b) PUBLIC REPORTS.—
‘‘(1) IN GENERAL.—The Secretary shall prepare and make
available to the public an annual report on the program established under this subtitle, including detailed information on—
‘‘(A) the number of rural business investment companies licensed by the Secretary during the previous fiscal
year;
‘‘(B) the aggregate amount of leverage that rural business investment companies have received from the Federal
Government during the previous fiscal year;
‘‘(C) the aggregate number of each type of leveraged
instruments used by rural business investment companies
during the previous fiscal year and how each number compares to previous fiscal years;
‘‘(D) the number of rural business investment company
licenses surrendered and the number of rural business
investment companies placed in liquidation during the previous fiscal year, identifying the amount of leverage each
rural business investment company has received from the
Federal Government and the type of leverage instruments
each rural business investment company has used;
‘‘(E) the amount of losses sustained by the Federal
Government as a result of operations under this subtitle
during the previous fiscal year and an estimate of the
total losses that the Federal Government can reasonably
expect to incur as a result of the operations during the
current fiscal year;
‘‘(F) actions taken by the Secretary to maximize
recoupment of funds of the Federal Government expended
to implement and administer the Rural Business Investment Program under this subtitle during the previous fiscal
year and to ensure compliance with the requirements of
this subtitle (including regulations);
‘‘(G) the amount of Federal Government leverage that
each licensee received in the previous fiscal year and the
types of leverage instruments each licensee used;
‘‘(H) for each type of financing instrument, the sizes,
types of geographic locations, and other characteristics of
the small business investment companies using the
instrument during the previous fiscal year, including the
extent to which the investment companies have used the
leverage from each instrument to make loans or equity
investments in rural areas; and

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116 STAT. 399

‘‘(I) the actions of the Secretary to carry out this subtitle.
‘‘(2) PROHIBITION.—In compiling the report required under
paragraph (1), the Secretary may not—
‘‘(A) compile the report in a manner that permits identification of any particular type of investment by an individual rural business investment company or small business concern in which a rural business investment company
invests; and
‘‘(B) may not release any information that is prohibited
under section 1905 of title 18, United States Code.
‘‘SEC. 384L. EXAMINATIONS.

‘‘(a) IN GENERAL.—Each rural business investment company
that participates in the program established under this subtitle
shall be subject to examinations made at the direction of the Secretary in accordance with this section.
‘‘(b) ASSISTANCE OF PRIVATE SECTOR ENTITIES.—An examination under this section may be conducted with the assistance of
a private sector entity that has the qualifications and the expertise
necessary to conduct such an examination.
‘‘(c) COSTS.—
‘‘(1) IN GENERAL.—The Secretary may assess the cost of
an examination under this section, including compensation of
the examiners, against the rural business investment company
examined.
‘‘(2) PAYMENT.—Any rural business investment company
against which the Secretary assesses costs under this paragraph shall pay the costs.
‘‘(d) DEPOSIT OF FUNDS.—Funds collected under this section
shall—
‘‘(1) be deposited in the account that incurred the costs
for carrying out this section;
‘‘(2) be made available to the Secretary to carry out this
section, without further appropriation; and
‘‘(3) remain available until expended.
‘‘SEC. 384M. INJUNCTIONS AND OTHER ORDERS.

‘‘(a) IN GENERAL.—
‘‘(1) APPLICATION BY SECRETARY.—Whenever, in the judgment of the Secretary, a rural business investment company
or any other person has engaged or is about to engage in
any act or practice that constitutes or will constitute a violation
of a provision of this subtitle (including any rule, regulation,
order, or participation agreement under this subtitle), the Secretary may apply to the appropriate district court of the United
States for an order enjoining the act or practice, or for an
order enforcing compliance with the provision, rule, regulation,
order, or participation agreement.
‘‘(2) JURISDICTION; RELIEF.—The court shall have jurisdiction over the action and, on a showing by the Secretary that
the rural business investment company or other person has
engaged or is about to engage in an act or practice described
in paragraph (1), a permanent or temporary injunction,
restraining order, or other order, shall be granted without
bond.
‘‘(b) JURISDICTION.—

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7 USC
2009cc–11.

7 USC
2009cc–12.

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116 STAT. 400

PUBLIC LAW 107–171—MAY 13, 2002
‘‘(1) IN GENERAL.—In any proceeding under subsection (a),
the court as a court of equity may, to such extent as the
court considers necessary, take exclusive jurisdiction over the
rural business investment company and the assets of the rural
business investment company, wherever located.
‘‘(2) TRUSTEE OR RECEIVER.—The court shall have jurisdiction in any proceeding described in paragraph (1) to appoint
a trustee or receiver to hold or administer the assets.
‘‘(c) SECRETARY AS TRUSTEE OR RECEIVER.—
‘‘(1) AUTHORITY.—The Secretary may act as trustee or
receiver of a rural business investment company.
‘‘(2) APPOINTMENT.—On the request of the Secretary, the
court shall appoint the Secretary to act as a trustee or receiver
of a rural business investment company unless the court considers the appointment inequitable or otherwise inappropriate
by reason of any special circumstances involved.

7 USC
2009cc–13.

7 USC
2009cc–14.

‘‘SEC. 384N. ADDITIONAL PENALTIES FOR NONCOMPLIANCE.

‘‘(a) IN GENERAL.—With respect to any rural business investment company that violates or fails to comply with this subtitle
(including any rule, regulation, order, or participation agreement
under this subtitle), the Secretary may, in accordance with this
section—
‘‘(1) void the participation agreement between the Secretary
and the rural business investment company; and
‘‘(2) cause the rural business investment company to forfeit
all of the rights and privileges derived by the rural business
investment company under this subtitle.
‘‘(b) ADJUDICATION OF NONCOMPLIANCE.—
‘‘(1) IN GENERAL.—Before the Secretary may cause a rural
business investment company to forfeit rights or privileges
under subsection (a), a court of the United States of competent
jurisdiction must find that the rural business investment company committed a violation, or failed to comply, in a cause
of action brought for that purpose in the district, territory,
or other place subject to the jurisdiction of the United States,
in which the principal office of the rural business investment
company is located.
‘‘(2) PARTIES AUTHORIZED TO FILE CAUSES OF ACTION.—
Each cause of action brought by the United States under this
subsection shall be brought by the Secretary or by the Attorney
General.
‘‘SEC. 384O. UNLAWFUL ACTS AND OMISSIONS; BREACH OF FIDUCIARY
DUTY.

‘‘(a) PARTIES DEEMED TO COMMIT A VIOLATION.—Whenever any
rural business investment company violates this subtitle (including
any rule, regulation, order, or participation agreement under this
subtitle), by reason of the failure of the rural business investment
company to comply with this subtitle or by reason of its engaging
in any act or practice that constitutes or will constitute a violation
of this subtitle, the violation shall also be deemed to be a violation
and an unlawful act committed by any person that, directly or
indirectly, authorizes, orders, participates in, causes, brings about,
counsels, aids, or abets in the commission of any acts, practices,
or transactions that constitute or will constitute, in whole or in
part, the violation.

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‘‘(b) FIDUCIARY DUTIES.—It shall be unlawful for any officer,
director, employee, agent, or other participant in the management
or conduct of the affairs of a rural business investment company
to engage in any act or practice, or to omit any act or practice,
in breach of the fiduciary duty of the officer, director, employee,
agent, or participant if, as a result of the act or practice, the
rural business investment company suffers or is in imminent danger
of suffering financial loss or other damage.
‘‘(c) UNLAWFUL ACTS.—Except with the written consent of the
Secretary, it shall be unlawful—
‘‘(1) for any person to take office as an officer, director,
or employee of any rural business investment company, or
to become an agent or participant in the conduct of the affairs
or management of a rural business investment company, if
the person—
‘‘(A) has been convicted of a felony, or any other
criminal offense involving dishonesty or breach of trust;
or
‘‘(B) has been found liable in a civil action for damages,
or has been permanently or temporarily enjoined by an
order, judgment, or decree of a court of competent jurisdiction, by reason of any act or practice involving fraud or
breach of trust; and
‘‘(2) for any person to continue to serve in any of the
capacities described in paragraph (1), if—
‘‘(A) the person is convicted of a felony or any other
criminal offense involving dishonesty or breach of trust;
or
‘‘(B) the person is found liable in a civil action for
damages, or is permanently or temporarily enjoined by
an order, judgment, or decree of a court of competent
jurisdiction, by reason of any act or practice involving
fraud or breach of trust.
‘‘SEC. 384P. REMOVAL OR SUSPENSION OF DIRECTORS OR OFFICERS.

‘‘Using the procedures established by the Secretary for removing
or suspending a director or an officer of a rural business investment
company, the Secretary may remove or suspend any director or
officer of any rural business investment company.
‘‘SEC. 384Q. CONTRACTING OF FUNCTIONS.

‘‘(a) IN GENERAL.—Notwithstanding any other provision of law,
to carry out the day-to-day management and operation of the program authorized by this subtitle on behalf of the Secretary, the
Secretary shall enter into an interagency agreement under section
1535 of title 31, United States Code, with another Federal agency
that has considerable expertise in operating a program under which
capital is provided for equity investments in private sector companies.
‘‘(b) FUNDING.—The costs incurred by a Federal agency entering
into an agreement under subsection (a) shall be reimbursed in
accordance with section 1535 of title 31, United States Code, from
amounts made available under section 384S(a)(2).
‘‘SEC. 384R. REGULATIONS.

‘‘The Secretary may promulgate such regulations as the Secretary considers necessary to carry out this subtitle.

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7 USC
2009cc–15.

7 USC
2009cc–16.

7 USC
2009cc–17.

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7 USC
2009cc–18.

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‘‘SEC. 384S. FUNDING.

‘‘(a) IN GENERAL.—Notwithstanding any other provision of law,
of the funds of the Commodity Credit Corporation, the Secretary
shall make available—
‘‘(1) such sums as may be necessary for the cost of guaranteeing $280,000,000 of debentures under this subtitle; and
‘‘(2) $44,000,000 to make grants under this subtitle.
‘‘(b) AVAILABILITY OF FUNDS.—Funds transferred under subsection (a) shall remain available until expended.’’.
SEC. 6030. RURAL STRATEGIC INVESTMENT PROGRAM.

The Consolidated Farm and Rural Development Act (as
amended by section 6029) is amended by adding at the end the
following:

‘‘Subtitle I—Rural Strategic Investment
Program
7 USC 2009dd.

‘‘SEC. 385A. PURPOSE.

‘‘The purpose of this subtitle is to establish a rural strategic
investment program—
‘‘(1) to provide rural communities with flexible resources
to develop comprehensive, collaborative, and locally-based strategic planning processes; and
‘‘(2) to implement innovative community and economic
development strategies that optimize regional competitive
advantages.
7 USC 2009dd–1.

‘‘SEC. 385B. DEFINITIONS.

‘‘In this subtitle:
‘‘(1) BENCHMARK.—The term ‘benchmark’ means an annual
set of strategies and goals of a Regional Board established
for the purpose of measuring performance in meeting the
regional plan of the Regional Board.
‘‘(2) CONFERENCE.—The term ‘‘Conference’’ means the
National Conference on Rural America conducted under section
385H.
‘‘(3) ELIGIBLE AREA.—
‘‘(A) IN GENERAL.—The term ‘eligible area’ means a
nonmetropolitan county (as defined by the Secretary) that
has a population of 50,000 inhabitants or less.
‘‘(B) INCLUSION.—
‘‘(i) IN GENERAL.—Subject to clause (ii), the term
‘eligible area’ includes an unincorporated or other area
of a county that has a population of more than 50,000
inhabitants if the unincorporated area or other area
is adjacent to an eligible rural area described in
subparagraph (A).
‘‘(ii) PARTICIPATION.—An area described in clause
(i) may be represented on a Regional Board.
‘‘(C) EXCLUSION.—The term ‘eligible area’ does not
include any area designated by the Secretary as a rural
empowerment zone or rural enterprise community.
‘‘(4) INNOVATION GRANT.—The term ‘innovation grant’
means an innovation grant made by the National Board to
a Regional Board under section 385G.

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‘‘(5) NATIONAL BOARD.—The term ‘National Board’ means
the National Board on Rural America established under section
385D(a).
‘‘(6) NATIONAL PLAN.—The term ‘national plan’ means a
national strategic investment plan of the National Board developed under section 385D(d)(3).
‘‘(7) PLANNING GRANT.—The term ‘planning grant’ means
a regional strategic investment planning grant made by the
National Board to a Regional Board under section 385F.
‘‘(8) PROGRAM.—The term ‘program’ means the rural strategic investment program established under this subtitle.
‘‘(9) REGION.—The term ‘region’ means the eligible areas
that—
‘‘(A) are under the jurisdiction of a Regional Board;
and
‘‘(B) meet criteria established by the National Board
not later than 1 year after the date of enactment of this
subtitle.
‘‘(10) REGIONAL BOARD.—The term ‘Regional Board’ means
a Regional Investment Board certified under section 385C(a).
‘‘(11) REGIONAL PLAN.—The term ‘regional plan’ means a
regional strategic investment plan of a Regional Board developed under section 385C(b)(3)(B).
‘‘SEC. 385C. REGIONAL INVESTMENT BOARDS.

7 USC 2009dd–2.

‘‘(a) IN GENERAL.—The National Board may certify a group
representing the interests described in subsection (b)(2)(A) as a
Regional Investment Board created to develop and implement a
regional strategic investment plan for grants made under this subtitle to promote investment in eligible areas.
‘‘(b) REQUIREMENTS FOR CERTIFICATION.—
‘‘(1) IN GENERAL.—A Regional Board shall meet the requirements of this subsection for certification.
‘‘(2) COMPOSITION.—
‘‘(A) IN GENERAL.—A Regional Board shall be composed
of residents of the region that broadly represent diverse
public, nonprofit, and private sector interests in investment
in the region, including (to the maximum extent practicable) representatives of—
‘‘(i) units of local government (including multijurisdictional units of local government);
‘‘(ii) in the case of regions with Indian populations,
Indian tribes (as defined in section 4 of the Indian
Self-Determination and Education Assistance Act (25
U.S.C. 450b));
‘‘(iii) private nonprofit community-based development organizations;
‘‘(iv) regional development organizations;
‘‘(v) private business organizations;
‘‘(vi) other entities and organizations, as determined by the Regional Board; and
‘‘(vii) consortia of entities and organizations
described in clauses (i) through (vii).
‘‘(B) LOCAL PUBLIC-PRIVATE REPRESENTATION.—Of the
members of a Regional Board, to the maximum extent
practicable—

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‘‘(i) 1⁄2 of the members shall be representatives
of units of local government and Indian tribes described
in subparagraph (A); and
‘‘(ii) 1⁄2 of the members shall be representatives
of nonprofit, regional, private, and other entities and
organizations described in subparagraph (A).
‘‘(C) EX-OFFICIO MEMBERS.—
‘‘(i) IN GENERAL.—An officer or employee of a Federal or State agency may serve as an ex-officio, nonvoting member of a Regional Board representing the
agency.
‘‘(ii) CONFLICTS.—Participation by a Federal officer
or employee in activities of the Regional Board shall
not constitute a violation of section 205 or 208 of
title 18, United States Code.
‘‘(D) CERTIFICATION.—To be certified by the National
Board, a Regional Board shall demonstrate to the National
Board that the Regional Board is broadly representative
of the interests described in subparagraph (A).
‘‘(E) APPEALS.—
‘‘(i) IN GENERAL.—Prior to certification of the
Regional Board by the National Board, representatives
of interests described in subparagraph (A) that participated in the development of a Regional Board may
appeal the composition of the Regional Board to the
National Board on the ground that—
‘‘(I) the composition of the Regional Board does
not adequately reflect the purposes of the program;
or
‘‘(II) the selection process for the Regional
Board unfairly disadvantaged those interests.
‘‘(ii) ACTION BY NATIONAL BOARD.—The National
Board shall act on any appeal of the composition of
a Regional Board before taking action on the certification of the Regional Board.
‘‘(3) DUTIES AND PURPOSE.—The organizational documents
of the proposed Regional Board shall demonstrate that, on
certification, the Regional Board shall—
‘‘(A) create a collaborative, inclusive public-private
planning process;
‘‘(B) develop, and submit to the National Board for
approval, a regional strategic investment plan that meets
the requirements of section 385F, with benchmarks, to
promote investment in eligible areas through the use of
grants made available under this subtitle;
‘‘(C) implement the approved regional plan;
‘‘(D) provide annual reports to the Secretary and the
National Board on progress made in achieving the benchmarks of the regional plan, including an annual financial
statement; and
‘‘(E) select a non-Federal organization (such as a
regional development organization) in the local area served
by the Regional Board that has previous experience in
the management of Federal funds to serve as fiscal manager of any funds of the Regional Board.

Reports.

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‘‘SEC. 385D. NATIONAL BOARD ON RURAL AMERICA.

7 USC 2009dd–3.

‘‘(a) ESTABLISHMENT.—
‘‘(1) IN GENERAL.—The Secretary shall establish a National
Board on Rural America to carry out the rural strategic investment program established under this subtitle.
‘‘(2) SUPERVISION AND DIRECTION.—Except as otherwise provided in this subtitle, the National Board shall be subject
to the general supervision and direction of the Secretary.
‘‘(b) COMPOSITION.—
‘‘(1) IN GENERAL.—
‘‘(A) APPOINTMENT.—In addition to the Secretary or
the designee of the Secretary, the National Board shall
consist of 14 members appointed by the Secretary from
among—
‘‘(i) representatives of nationally recognized
entrepreneurship organizations;
‘‘(ii) representatives of regional planning and
development organizations;
‘‘(iii) representatives of community-based organizations;
‘‘(iv) elected members of county governments;
‘‘(v) elected members of State legislatures;
‘‘(vi) representatives of the rural philanthropic
community; and
‘‘(vii) representatives of Indian tribes (as defined
in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b)).
‘‘(B) RECOMMENDATIONS.—In appointing the members
of the National Board under subparagraph (A), the Secretary shall consider recommendations made by—
‘‘(i) the chairman and ranking member of each
of the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate;
‘‘(ii) the Majority Leader of the Senate; and
‘‘(iii) the Speaker of the House of Representatives.
‘‘(3) TERM OF OFFICE.—
‘‘(A) IN GENERAL.—Subject to subparagraph (B), the
term of office of a member of the National Board appointed
under paragraph (1)(A) shall be 4 years.
‘‘(B) STAGGERED INITIAL TERMS.—Of the initial members of the National Board appointed under paragraph
(1)(A), the term of office of—
‘‘(i) 5 members shall be 4 years;
‘‘(ii) 5 members shall be 3 years; and
‘‘(iii) 4 members shall be 2 years.
‘‘(4) INITIAL APPOINTMENTS.—Not later than 90 days after
the date of enactment of this subtitle, the Secretary shall
appoint the initial members of the National Board under paragraph (1)(A).
‘‘(5) EX-OFFICIO MEMBERS.—
‘‘(A) SPECIAL ASSISTANT TO THE PRESIDENT FOR RURAL
POLICY.—If appointed by the President under section
6406(1) of the Farm Security and Rural Investment Act
of 2002, the Special Assistant to the President for Rural
Policy shall serve as an ex-officio, non-voting member of
the National Board.

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(B) OTHER MEMBERS.—In consultation with the chairman and ranking member of each of the Committee on
Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the
Senate, the Secretary may appoint not more than 3 other
officers or employees of the Executive Branch to serve
as ex-officio, non-voting members of the National Board.
‘‘(6) VACANCIES.—A vacancy on the National Board shall
be filled in the same manner as the original appointment.
‘‘(7) COMPENSATION.—A member of the National Board
shall receive no compensation for service on the National Board,
but shall be reimbursed for travel and other expenses incurred
in carrying out the duties of the member of the National Board
in accordance with section 5702 and 5703 of title 5, United
States Code.
‘‘(8) CHAIRPERSON.—The National Board shall select a
chairperson from among the members of the National Board.
‘‘(9) MEETINGS.—
‘‘(A) TIME AND PLACE.—The National Board shall meet
at the call of the chairperson.
‘‘(B) QUORUM.—A quorum of the National Board shall
consist of a majority of the members.
‘‘(C) MAJORITY VOTE.—A decision of the National Board
shall be made by majority vote.
‘‘(10) FEDERAL STATUS.—For purposes of Federal law, a
member of the National Board shall be considered a special
Government employee (as defined in section 202(a) of title
18, United States Code).
‘‘(11) CONFLICT OF INTEREST.—
‘‘(A) IN GENERAL.—Except as provided in subparagraph
(C), no member of the National Board shall vote on any
matter respecting any application for a grant or other
particular matter pending before the National Board in
which, to the knowledge of the member, the member,
spouse, or child of the member, partner, or organization
in which the member is serving as officer, director, trustee,
partner, or employee, or any person or organization with
whom the member is negotiating or has any arrangement
concerning prospective employment, has a financial
interest.
‘‘(B) VIOLATIONS.—A violation of subparagraph (A) by
a member of the National Board shall be cause for removal
of the member, but shall not impair or otherwise affect
the validity of any otherwise lawful action by the National
Board in which the member participated.
‘‘(C) EXCEPTION.—Subparagraph (A) shall not apply
to the extent a member of the National Board advises
the National Board of the nature of the particular matter
in which the member proposes to participate, if—
‘‘(i) the member makes a full disclosure of the
financial interest; and
‘‘(ii) prior to any participation by the member,
the National Board determines, by majority vote of
the other members of the National Board, that the
financial interest is too remote or too inconsequential
to affect the integrity of the services of the member
to the National Board in that matter.

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‘‘(c) ADMINISTRATIVE SUPPORT.—The Secretary, on a reimbursable basis, may provide such administrative support to the National
Board as the Secretary determines is necessary to carry out the
duties of the National Board.
‘‘(d) DUTIES.—The National Board shall—
‘‘(1) certify Regional Boards in accordance with section
385C, with the initial certification of Regional Boards occurring
not later than 540 days after the date of enactment of this
subtitle;
‘‘(2) approve, negotiate, or disapprove each regional plan
that is submitted by a Regional Board to the National Board
under section 385C;
‘‘(3) develop, and submit to the Secretary for approval,
a national strategic investment plan;
‘‘(4) use the amount received from the Secretary under
section 385E to make planning grants and innovation grants
to Regional Boards and to otherwise carry out the program;
‘‘(5) provide leadership and advice to Regional Boards on
issues, best practices, and emerging trends relating to rural
development;
‘‘(6) evaluate the progress of each Regional Board in
achieving the benchmarks of the regional plan using annual
reports submitted under section 385C(b)(3)(D) and any other
information that is available to the Regional Board; and
‘‘(7) submit an annual report on the performance of
Regional Boards and the program to—
‘‘(A) the Committee on Agriculture of the House of
Representatives;
‘‘(B) the Committee on Agriculture, Nutrition, and Forestry of the Senate; and
‘‘(C) the Secretary.
‘‘SEC. 385E. RURAL STRATEGIC INVESTMENT PROGRAM.

7 USC 2009dd–4.

‘‘(a) IN GENERAL.—If the Secretary approves a national strategic
investment plan submitted by the National Board, of the funds
of the Commodity Credit Corporation, the Secretary shall transfer
to the National Board $100,000,000, to remain available until
expended, for the Board to use to make planning grants and innovation grants to Regional Boards and to otherwise carry out this
subtitle.
‘‘(b) USE BY NATIONAL BOARD.—Of the amount transferred by
the Secretary to the National Board under subsection (a), the
National Board shall use—
‘‘(1) not less than $8,000,000 to make planning grants
to Regional Boards under section 385F;
‘‘(2) not less than $87,000,000 to make innovation grants
to Regional Boards under section 385G; and
‘‘(3) the remainder of the funds to carry out section 385H
and administer this subtitle (other than section 385H).
‘‘SEC. 385F. REGIONAL STRATEGIC INVESTMENT PLANNING GRANTS.

7 USC 2009dd–5.

‘‘(a) IN GENERAL.—The National Board shall use amounts made
available under section 385E(b)(1) to make not fewer than 80 planning grants, on a competitive basis, to applicant Regional Boards
to develop, maintain, evaluate, and report progress on regional
strategic investment plans in accordance with section 385C and
this section.

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‘‘(b) REGIONAL PLANS.—A regional plan for a region covered
by a Regional Board shall, to the maximum extent practicable,
cover—
‘‘(1) basic infrastructure needs of the region;
‘‘(2) basic services within the region;
‘‘(3) opportunities for economic diversification and innovation within the region, with particular attention to entrepreneurial support and innovation;
‘‘(4) the current and future human resource capacity of
the region;
‘‘(5) access to market-based financing and venture and
equity capital in the region;
‘‘(6) the development of innovative public and private
collaborations for investments in the region; and
‘‘(7) other appropriate matters, as determined by the
National Board and the Secretary.
‘‘(c) PREFERENCES.—In awarding planning grants, the National
Board shall give a preference to planning grants that will be used
to address community capacity building and community sustainability.
‘‘(d) AMOUNT.—The total amount of a planning grant made
to a Regional Board shall not exceed $100,000.
‘‘(e) COST SHARING.—
‘‘(1) IN GENERAL.—Subject to paragraphs (2) and (3), the
share of the costs of developing, maintaining, evaluating, and
reporting on a regional plan funded by a grant under this
section shall not exceed 50 percent.
‘‘(2) FORM.—
‘‘(A) IN GENERAL. Except as provided in subparagraph
(B), a Regional Board shall pay the grantee share of the
costs described in paragraph (1) in the form of cash, services, materials, or other in-kind contributions.
‘‘(B) LIMITATION.—A grantee shall not pay more than
50 percent of the grantee share in the form of services,
materials, or other in-kind contributions.
‘‘(3) INCREASED SHARE.—The National Board may increase
the share of the costs covered by a planning grant made to
a Regional Board under this section if a limited ability of
the Regional Board to pay would otherwise create a barrier
to full participation in the program.
7 USC 2009dd–6.

‘‘SEC. 385G. INNOVATION GRANTS.

‘‘(a) IN GENERAL.—The National Board shall use amounts made
available under section 385E(b)(2) to make innovation grants, on
a competitive basis, to Regional Boards to implement projects that
are identified in the regional plans of the Regional Boards.
‘‘(b) ELIGIBILITY.—
‘‘(1) IN GENERAL.—For a Regional Board to be eligible to
receive an innovation grant, the National Board shall determine
that—
‘‘(A) the regional plan of a Regional Board meets the
requirements of this subtitle;
‘‘(B) the management and organizational structure of
the Regional Board is sufficient to oversee grant projects;
‘‘(C) the Regional Board will be able to provide the
grantee share required under this section; and

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‘‘(D) the Regional Board agrees to achieve, to the maximum extent practicable, the performance-based benchmarks of the regional plan.
‘‘(2) RELATIONSHIP TO PLANNING GRANTS.—A Regional
Board that meets the requirements of paragraph (1) shall be
eligible to receive an innovation grant, regardless of whether
the Regional Board receives a planning grant.
‘‘(c) SELECTION.—Subject to subsection (d), of the applications
submitted by Regional Boards for innovation grants, the National
Board shall, to the maximum extent practicable, select not fewer
than 30 regional boards to receive innovation grants.
‘‘(d) PREFERENCES.—In awarding innovation grants, the
National Board shall give a preference (in order of priority) to
Regional Boards that—
‘‘(1) exhibit collaborative innovation and entrepreneurship,
particularly within a public-private partnership;
‘‘(2) represent a broad coalition of interests described in
section 385C(b)(2)(A);
‘‘(3) demonstrate a plan to leverage public (Federal and
non-federal) and private funds and existing assets, including
natural assets and public infrastructure;
‘‘(4) address gaps in existing basic services within a region;
‘‘(5) address economic diversification, including agricultural
and non-agriculturally based economies, within a regional
framework;
‘‘(6) demonstrate a plan to achieve multijurisdictional
regional planning and development, with particular evidence
of economic development successes within diverse stakeholder
frameworks; or
‘‘(7) meet other community development needs identified
by a Regional Board.
‘‘(e) USES.—
‘‘(1) LEVERAGE.—A Regional Board shall prioritize projects,
in part, on the degree to which the Regional Board is able
to leverage additional funds for the implementation of the
projects.
‘‘(2) PURPOSES.—A Regional Board may use an innovation
grant provided for a region—
‘‘(A) to support the development of critical infrastructure necessary to facilitate economic development in the
region;
‘‘(B) to provide assistance to entities within the region
that provide basic public services;
‘‘(C) to assist with job training, workforce development,
or other needs related to the development and maintenance
of strong local and regional economies;
‘‘(D) to assist in the development of unique new
collaborations that link public, private, and philanthropic
resources to achieve collaboratively designed regional
advancement; and
‘‘(E) to provide support to business investment.
‘‘(3) OTHER DEPARTMENT PROGRAMS.—A Regional Board
may not use an innovation grant provided for a region for
any purpose for which funding may be obtained under any
other rural development program of the Department of Agriculture unless—
‘‘(A) the Regional Board—

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‘‘(i) has submitted an application for the funding
under the other program; and
‘‘(ii) withdraws the application; and
‘‘(B) the National Board approves use of the innovation
grant for that purpose.
‘‘(4) OPERATING EXPENSES.—A Regional Board may use for
administrative costs in carrying out programs and activities
related to the grant the greater of—
‘‘(A) $100,000; or
‘‘(B) 5 percent of the amount of an innovation grant
provided.
‘‘(f) AMOUNT.—
‘‘(1) IN GENERAL.—The amount of an innovation grant made
to a Regional Board shall not exceed $3,000,000.
‘‘(2) AVAILABILITY.—The amount of an innovation grant
made to a Regional Board shall remain available until
expended.
‘‘(g) COST SHARING.—
‘‘(1) IN GENERAL.—Subject to paragraphs (2) and (3), the
share of the costs of projects covered by an innovation grant
made to a Regional Board under this section shall not exceed
75 percent, as determined by the National Board.
‘‘(2) FORM.—A Regional Board may pay the grantee share
of the costs of projects covered by an innovation grant in the
form of cash or services, materials, or other in-kind contributions.
‘‘(3) WAIVER OF GRANTEE SHARE.—The National Board may
waive the grantee share of the costs of projects covered by
an innovation grant made to a Regional Board under this
section if the National Board determines that such a waiver
is appropriate.
‘‘(4) OTHER FEDERAL PROGRAMS.—For the purpose of determining grantee share requirements for any other Federal programs, funds provided for innovation grants shall be considered
to be non-Federal funds.
‘‘(h) NEGOTIATION.—The National Board may—
‘‘(1) negotiate with a Regional Board on the substance,
size, and scope of a regional plan; and
‘‘(2) approve an innovation grant for an amount that is
lower than the amount requested by the Regional Board.
‘‘(i) NONCOMPLIANCE.—If a Regional Board fails to comply with
the requirements of this section, the National Board may take
such actions as are necessary to obtain reimbursement of unused
grant funds.
‘‘(j) OTHER USES.—The National Board may use not more than
5 percent of the amounts made available for innovation grants—
‘‘(1) to provide assistance to interests described in section
385C(b)(2)(A) to obtain certification of a Regional Board;
‘‘(2) to provide assistance for emergent innovative
opportunities that are not covered by existing regional plans;
‘‘(3) to provide technical assistance, research, organizational
support, and other capacity building infrastructure to support
existing Regional Boards;
‘‘(4) to provide assistance for other entrepreneurial
opportunities to advance the goals of the program; or
‘‘(5) to advance a more integrative rural policy framework
for the United States.

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‘‘(k) TRANSFERS.—To ensure maximum use of funds provided
under this subtitle, the National Board may transfer not more
than 10 percent of the amount of funds made available between
planning grants and innovation grants.

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‘‘SEC. 385H. NATIONAL CONFERENCE ON RURAL AMERICA.

7 USC 2009dd–7.

‘‘(a) IN GENERAL.—The President shall call and conduct a
National Conference on Rural America, which shall be held not
earlier than November 1, 2002, and not later than October 30,
2004.
‘‘(b) PURPOSE.—The purpose of the Conference shall be to bring
together the resources of governmental agencies and the private
and nonprofit sectors to develop—
‘‘(1) policy recommendations and integrative strategies for
addressing the unique challenges facing rural areas of the
United States; and
‘‘(2) an implementation plan, with outcome-based measurements, for addressing the challenges.
‘‘(c) COMPOSITION.—
‘‘(1) IN GENERAL.—The Conference shall be comprised of—
‘‘(A) representatives of organizations devoted to rural
development;
‘‘(B) Members of Congress, including the chairman and
ranking member of each of the Committee on Agriculture
of the House of Representatives and the Committee on
Agriculture, Nutrition, and Forestry of the Senate;
‘‘(C) representatives of the Department of Agriculture
and other Federal agencies;
‘‘(D) State, local, and tribal elected officials and representatives;
‘‘(E) representatives of colleges and universities, State
and tribal extension services, and State rural development
councils; and
‘‘(F) individuals with specialized knowledge of and
expertise in rural and community development, cooperative
business, agricultural credit, venture capital, health care,
and rural demography.
‘‘(2) SELECTION.—Of the participants in the Conference
described in paragraph (1)—
‘‘(A) 1⁄3 of the members shall be selected by the President;
‘‘(B) 1⁄3 of the members shall be selected by the Chairman and the ranking member of the Committee on Agriculture of the House of Representatives; and
‘‘(C) 1⁄3 of the members shall be selected by the Chairman and the ranking member of the Committee on Agriculture, Nutrition, and Forestry of the Senate.
‘‘(3) REPRESENTATION.—In selecting the participants of the
Conference, the President and the Chairman of each Committee
referred to in paragraph (2) shall ensure, to the maximum
extent practicable, that the participants are representative of
the ethnic, racial, and linguistic diversity of rural areas of
the United States.
‘‘(d) REPORT.—
‘‘(1) REPORT TO PRESIDENT.—Not later than 120 days after
the termination of the Conference, the Conference shall submit

President.
Deadline.

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to the President a report that contains the findings and recommendations of the Conference, including findings and recommendations to address needs related to—
‘‘(A) telecommunications;
‘‘(B) rural health issues;
‘‘(C) transportation;
‘‘(D) opportunities for economic diversification and
innovation within rural America, with particular attention
to entrepreneurial support and innovation;
‘‘(E) the current and future human resource capacity
of rural America;
‘‘(F) access to market-based financing and venture and
equity capital in rural America; and
‘‘(G) the development of innovative public and private
collaborations for investments in rural America.
‘‘(2) REPORT MADE PUBLIC AND TO CONGRESS.—Not later
than 90 days after receipt by the President, the President
shall—
‘‘(A) make the report public; and
‘‘(B) transmit to the Committee on Agriculture of the
House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a copy of
the report and a statement of the President containing
recommendations for implementing the report.
‘‘(3) PUBLICATION AND DISTRIBUTION.—
‘‘(A) IN GENERAL.—The Conference shall publish and
distribute the report described in paragraph (1).
‘‘(B) MANDATORY DISTRIBUTION.—The Conference shall
provide a copy of a report published under subparagraph
(A), at no cost, to—
‘‘(i) each Federal depository library; and
‘‘(ii) on request, each State, tribal, and local elected
official in a rural area of the United States.
‘‘(e) FUNDING.—Not later than 180 days after the establishment
of the National Board, the National Board shall transfer not more
than $2,000,000 to the Office of the President to carry out this
section, to remain available until expended.’’.
SEC. 6031. FUNDING OF PENDING RURAL DEVELOPMENT LOAN AND
GRANT APPLICATIONS.

(a) DEFINITION OF APPLICATION.—In this section, the term
‘‘application’’ does not include an application for a loan or grant
that, as of the date of enactment of this Act, is in the preapplication
phase of consideration under regulations of the Secretary of Agriculture in effect on the date of enactment of this Act.
(b) USE OF FUNDS.—Subject to subsection (c), the Secretary
of Agriculture shall use funds made available under subsection
(d) to provide funds for applications that are pending on the date
of enactment of this Act for—
(1) water or waste disposal grants or direct loans under
paragraph (1) or (2) of section 306(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1926(a)); and
(2) emergency community water assistance grants under
section 306A of that Act (7 U.S.C. 1926a).
(c) LIMITATIONS.—
(1) APPROPRIATED AMOUNTS.—Funds made available under
this section shall be available to the Secretary to provide funds

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for applications for loans and grants described in subsection
(b) that are pending on the date of enactment of this Act
only to the extent that funds for the loans and grants appropriated in the annual appropriations Act for fiscal year 2002
have been exhausted.
(2) PROGRAM REQUIREMENTS.—The Secretary may use
funds made available under this section to provide funds for
a pending application for a loan or grant described in subsection
(b) only if the Secretary processes, reviews, and approves the
application in accordance with regulations in effect on the date
of enactment of this Act.
(3) PRIORITY.—In providing funding under this section for
pending applications for loans or grants described in subsection
(b), the Secretary shall provide funding in the following order
of priority (until funds made available under this section are
exhausted):
(A) Pending applications for water systems.
(B) Pending applications for waste disposal systems.
(d) FUNDING.—Notwithstanding any other provision of law, of
the funds of the Commodity Credit Corporation, the Secretary shall
use $360,000,000 to carry out this section, to remain available
until expended.

Subtitle B—Rural Electrification Act of
1936
SEC. 6101. GUARANTEES FOR BONDS AND NOTES ISSUED FOR ELECTRIFICATION OR TELEPHONE PURPOSES.

(a) IN GENERAL.—The Rural Electrification Act of 1936 is
amended by inserting after section 313 (7 U.S.C. 940c) the following:
‘‘SEC. 313A. GUARANTEES FOR BONDS AND NOTES ISSUED FOR ELECTRIFICATION OR TELEPHONE PURPOSES.

7 USC 940c–1.

‘‘(a) IN GENERAL.—Subject to subsection (b), the Secretary shall
guarantee payments on bonds or notes issued by cooperative or
other lenders organized on a not-for-profit basis if the proceeds
of the bonds or notes are used to make loans for any electrification
or telephone purpose eligible for assistance under this Act, including
section 4 or 201 or to refinance bonds or notes issued for such
purposes.
‘‘(b) LIMITATIONS.—
‘‘(1) OUTSTANDING LOANS.—A lender shall not receive a
guarantee under this section for a bond or note if, at the
time of the guarantee, the total principal amount of such
guaranteed bonds or notes outstanding of the lender would
exceed the principal amount of outstanding loans of the lender
for electrification or telephone purposes that have been made
concurrently with loans approved for such purposes under this
Act.
‘‘(2) GENERATION OF ELECTRICITY.—The Secretary shall not
guarantee payment on a bond or note issued by a lender,
the proceeds of which are used for the generation of electricity.
‘‘(3) QUALIFICATIONS.—The Secretary may deny the request
of a lender for the guarantee of a bond or note under this
section if the Secretary determines that—

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‘‘(A) the lender does not have appropriate expertise
or experience or is otherwise not qualified to make loans
for electrification or telephone purposes;
‘‘(B) the bond or note issued by the lender would not
be investment grade quality without a guarantee; or
‘‘(C) the lender has not provided to the Secretary a
list of loan amounts approved by the lender that the lender
certifies are for eligible purposes described in subsection
(a).
‘‘(4) INTEREST RATE REDUCTION.—
‘‘(A) IN GENERAL.—Except as provided in subparagraph
(B), a lender may not use any amount obtained from the
reduction in funding costs as a result of the guarantee
of a bond or note under this section to reduce the interest
rate on a new or outstanding loan.
‘‘(B) CONCURRENT LOANS.—A lender may use any
amount described in subparagraph (A) to reduce the
interest rate on a loan if the loan is—
‘‘(i) made by the lender for electrification or telephone projects that are eligible for assistance under
this Act; and
‘‘(ii) made concurrently with a loan approved by
the Secretary under this Act for such a project, as
provided in section 307.
‘‘(c) FEES.—
‘‘(1) IN GENERAL.—A lender that receives a guarantee issued
under this section on a bond or note shall pay a fee to the
Secretary.
‘‘(2) AMOUNT.—The amount of an annual fee paid for the
guarantee of a bond or note under this section shall be equal
to 30 basis points of the amount of the unpaid principal of
the bond or note guaranteed under this section.
‘‘(3) PAYMENT.—A lender shall pay the fees required under
this subsection on a semiannual basis.
‘‘(4) RURAL ECONOMIC DEVELOPMENT SUBACCOUNT.—Subject
to subsection (e)(2), fees collected under this subsection shall
be—
‘‘(A) deposited into the rural economic development
subaccount maintained under section 313(b)(2)(A), to
remain available until expended; and
‘‘(B) used for the purposes described in section
313(b)(2)(B).
‘‘(d) GUARANTEES.—
‘‘(1) IN GENERAL.—A guarantee issued under this section
shall—
‘‘(A) be for the full amount of a bond or note, including
the amount of principal, interest, and call premiums;
‘‘(B) be fully assignable and transferable; and
‘‘(C) represent the full faith and credit of the United
States.
‘‘(2) LIMITATION.—To ensure that the Secretary has the
resources necessary to properly examine the proposed guarantees, the Secretary may limit the number of guarantees issued
under this section to 5 per year.
‘‘(3) DEPARTMENT OPINION.—On the timely request of a
lender, the General Counsel of the Department of Agriculture
shall provide the Secretary with an opinion regarding the

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validity and authority of a guarantee issued to the lender
under this section.
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) IN GENERAL.—There are authorized to be appropriated
such sums as are necessary to carry out this section.
‘‘(2) FEES.—To the extent that the amount of funds appropriated for a fiscal year under paragraph (1) are not sufficient
to carry out this section, the Secretary may use up to 1⁄3
of the fees collected under subsection (c) for the cost of providing
guarantees of bonds and notes under this section before depositing the remainder of the fees into the rural economic development subaccount maintained under section 313(b)(2)(A).
‘‘(f) TERMINATION.—The authority provided under this section
shall terminate on September 30, 2007.’’.
(b) ADMINISTRATION.—
(1) REGULATIONS.—Not later than 180 days after the date
of enactment of this Act, the Secretary of Agriculture shall
promulgate regulations to carry out the amendments made
by this section.
(2) IMPLEMENTATION.—Not later than 240 days after the
date of enactment of this Act, the Secretary shall implement
the amendment made by this section.

7 USC 940c–1
note.
Deadline.

SEC. 6102. EXPANSION OF 911 ACCESS.

Title III of the Rural Electrification Act of 1936 (7 U.S.C.
931 et seq.) is amended by adding at the end the following:
‘‘SEC. 315. EXPANSION OF 911 ACCESS.

7 USC 940e.

‘‘(a) IN GENERAL.—Subject to such terms and conditions as
the Secretary may prescribe, the Secretary may make telephone
loans under this title to borrowers of loans made by the Rural
Utilities Service, State or local governments, Indian tribes (as
defined in section 4 of the Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b)), or other public entities for facilities
and equipment to expand or improve 911 access and integrated
emergency communications systems in rural areas.
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 2002 through 2007.’’.
SEC. 6103. ENHANCEMENT OF ACCESS TO BROADBAND SERVICE IN
RURAL AREAS.

(a) IN GENERAL.—The Rural Electrification Act of 1936 (7
U.S.C. 901 et seq.) is amended by adding at the end the following:

‘‘TITLE VI—RURAL BROADBAND ACCESS
‘‘SEC. 601. ACCESS TO BROADBAND TELECOMMUNICATIONS SERVICES
IN RURAL AREAS.

Loans.
7 USC 950bb.

‘‘(a) PURPOSE.—The purpose of this section is to provide loans
and loan guarantees to provide funds for the costs of the construction, improvement, and acquisition of facilities and equipment for
broadband service in eligible rural communities.
‘‘(b) DEFINITIONS.—In this section:
‘‘(1) BROADBAND SERVICE.—The term ‘broadband service’
means any technology identified by the Secretary as having
the capacity to transmit data to enable a subscriber to the

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service to originate and receive high-quality voice, data,
graphics, and video.
‘‘(2) ELIGIBLE RURAL COMMUNITY.—The term ‘eligible rural
community’ means any incorporated or unincorporated place
that—
‘‘(A) has not more than 20,000 inhabitants, based on
the most recent available population statistics of the
Bureau of the Census; and
‘‘(B) is not located in an area designated as a standard
metropolitan statistical area.
‘‘(c) LOANS AND LOAN GUARANTEES.—
‘‘(1) IN GENERAL.—The Secretary shall make or guarantee
loans to eligible entities described in subsection (d) to provide
funds for the construction, improvement, or acquisition of facilities and equipment for the provision of broadband service in
eligible rural communities.
‘‘(2) PRIORITY.—In making or guaranteeing loans under
paragraph (1), the Secretary shall give priority to eligible rural
communities in which broadband service is not available to
residential customers.
‘‘(d) ELIGIBLE ENTITIES.—
‘‘(1) IN GENERAL.—To be eligible to obtain a loan or loan
guarantee under this section, an entity shall—
‘‘(A) have the ability to furnish, improve, or extend
a broadband service to an eligible rural community; and
‘‘(B) submit to the Secretary a proposal for a project
that meets the requirements of this section.
‘‘(2) STATE AND LOCAL GOVERNMENTS.—A State or local
government (including any agency, subdivision, or instrumentality thereof (including consortia thereof)) shall be eligible
for a loan or loan guarantee under this section to provide
broadband services to an eligible rural community only if, not
later than 90 days after the Administrator has promulgated
regulations to carry out this section, no other eligible entity
is already offering, or has committed to offer, broadband services to the eligible rural community.
‘‘(3) SUBSCRIBER LINES.—An entity shall not be eligible
to obtain a loan or loan guarantee under this section if the
entity serves more than 2 percent of the telephone subscriber
lines installed in the aggregate in the United States.
‘‘(e) BROADBAND SERVICE.—The Secretary shall, from time to
time as advances in technology warrant, review and recommend
modifications of rate-of-data transmission criteria for purposes of
the identification of broadband service technologies under subsection (b)(1).
‘‘(f) TECHNOLOGICAL NEUTRALITY.—For purposes of determining
whether or not to make a loan or loan guarantee for a project
under this section, the Secretary shall use criteria that are technologically neutral.
‘‘(g) TERMS AND CONDITIONS FOR LOANS AND LOAN GUARANTEES.—Notwithstanding any other provision of law, a loan or loan
guarantee under subsection (c) shall—
‘‘(1) bear interest at an annual rate of, as determined
by the Secretary—
‘‘(A) in the case of a direct loan—

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‘‘(i) the cost of borrowing to the Department of
the Treasury for obligations of comparable maturity;
or
‘‘(ii) 4 percent; and
‘‘(B) in the case of a guaranteed loan, the current
applicable market rate for a loan of comparable maturity;
and
‘‘(2) have a term not to exceed the useful life of the assets
constructed, improved, or acquired with the proceeds of the
loan or extension of credit.
‘‘(h) USE OF LOAN PROCEEDS TO REFINANCE LOANS FOR DEPLOYMENT OF BROADBAND SERVICE.—Notwithstanding any other provision of this Act, the proceeds of any loan made or guaranteed
by the Secretary under this Act may be used by the recipient
of the loan for the purpose of refinancing an outstanding obligation
of the recipient on another telecommunications loan made under
this Act if the use of the proceeds for that purpose will further
the construction, improvement, or acquisition of facilities and equipment for the provision of broadband service in eligible rural communities.
‘‘(i) REPORTS.—Not later than 1 year after the date of enactment
of this section, and biennially thereafter, the Administrator shall
submit to Congress a report that—
‘‘(1) describes how the Administrator determines under subsection (a)(1) that a service enables a subscriber to originate
and receive high-quality voice, data, graphics, and video; and
‘‘(2) provides a detailed list of services that have been
granted assistance under this section.
‘‘(j) FUNDING.—
‘‘(1) IN GENERAL.—Notwithstanding any other provision of
law, of the funds of the Commodity Credit Corporation, the
Secretary shall make available to carry out this section—
‘‘(A) $20,000,000 for each of fiscal years 2002 through
2005, to remain available until expended; and
‘‘(B) $10,000,000 for each of fiscal years 2006 and 2007,
to remain available until expended.
‘‘(2) TELEVISION FUNDS.—
‘‘(A) IN GENERAL.—The Secretary shall be entitled to
receive, shall accept, and shall use to carry out this section,
without further appropriation any funds made available
under section 1011(a)(2)(B) of the Launching Our Communities’ Access to Local Television Act of 2000 (47 U.S.C.
1109(a)(2)(B)).
‘‘(B) USE OF TELEVISION FUNDS.—The Secretary shall
use any funds received under subparagraph (A) in equal
amounts for each remaining fiscal year on receipt of the
funds (including the fiscal year of receipt) through fiscal
year 2007.
‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—In addition to
funds otherwise made available under this subsection, there
are authorized to be appropriated such sums as necessary to
carry out this section for each of fiscal years 2003 through
2007.
‘‘(4) ALLOCATION OF FUNDS.—
‘‘(A) IN GENERAL.—From amounts made available for
each fiscal year under this subsection, the Secretary shall—

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‘‘(i) establish a national reserve for loans and loan
guarantees to eligible entities in States under this
section; and
‘‘(ii) allocate amounts in the reserve to each State
for each fiscal year for loans and loan guarantees to
eligible entities in the State.
‘‘(B) AMOUNT.—The amount of an allocation made to
a State for a fiscal year under subparagraph (A) shall
bear the same ratio to the amount of allocations made
for all States for the fiscal year as the number of communities with a population of 2,500 inhabitants or less in
the State bears to the number of communities with a
population of 2,500 inhabitants or less in all States, as
determined on the basis of the latest available census.
‘‘(C) UNOBLIGATED AMOUNTS.—Any amounts in the
reserve established for a State for a fiscal year under
subparagraph (B) that are not obligated by April 1 of
the fiscal year shall be available to the Secretary to make
loans and loan guarantees under this section to eligible
entities in any State, as determined by the Secretary.
‘‘(k) TERMINATION OF AUTHORITY.—No loan or loan guarantee
may be made under this section after September 30, 2007.’’.
(b) REGULATIONS.—
(1) IN GENERAL.—Not later than 180 days after the date
of enactment of this Act, the Secretary of Agriculture shall
promulgate such regulations as are necessary to implement
the amendment made by subsection (a).
(2) PROCEDURE.—The promulgation of the regulations shall
be made without regard to—
(A) the notice and comment provisions of section 553
of title 5, United States Code;
(B) the Statement of Policy of the Secretary of Agriculture effective July 24, 1971 (36 Fed. Reg. 13804),
relating to notices of proposed rulemaking and public
participation in rulemaking; and
(C) chapter 35 of title 44, United States Code (commonly known as the ‘‘Paperwork Reduction Act’’).
(3) CONGRESSIONAL REVIEW OF AGENCY RULEMAKING.—In
carrying out this subsection, the Secretary shall use the
authority provided under section 808 of title 5, United States
Code.

7 USC 950bb
note.
Deadline.

Subtitle C—Food, Agriculture,
Conservation, and Trade Act of 1990
SEC. 6201. ALTERNATIVE AGRICULTURAL RESEARCH AND COMMERCIALIZATION CORPORATION.

7 USC 5901 note.

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(a) REPEAL OF CORPORATION AUTHORIZATION.—Subtitle G of
title XVI of the Food, Agriculture, Conservation, and Trade Act
of 1990 (7 U.S.C. 5901 et seq.) is repealed.
(b) DISPOSITION OF ASSETS.—On the date of enactment of this
Act—
(1) the assets, both tangible and intangible, of the Alternative Agricultural Research and Commercialization Corporation (referred to in this section as the ‘‘Corporation’’), including
the funds in the Alternative Agricultural Research and

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Commercialization Revolving Fund as of the date of enactment
of this Act, are transferred to the Secretary of Agriculture;
and
(2) notwithstanding the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 471 et seq.) and any
other law that prescribes procedures for procurement, use, and
disposal of property by a Federal agency, the Secretary shall
have authority to manage and dispose of the assets transferred
under paragraph (1) in a manner that, to the maximum extent
practicable, provides the best value to the Federal Government.
(c) USE OF ASSETS.—
(1) IN GENERAL.—Funds transferred under subsection (b),
and any income from assets or proceeds from the sale of assets
transferred under subsection (b), shall be deposited in an
account in the Treasury, and shall remain available to the
Secretary until expended, without further appropriation, to
pay—
(A) any claims against, or obligations of, the Corporation; and
(B) the costs incurred by the Secretary in carrying
out this section.
(2) FINAL DISPOSITION.—On final disposition of all assets
transferred under subsection (b), any funds remaining in the
account described in paragraph (1) shall be transferred into
miscellaneous receipts in the Treasury.
(d) CONFORMING AMENDMENTS.—
(1) Section 5315 of title 5, United States Code, is amended
by striking ‘‘Executive Director of the Alternative Agricultural
Research and Commercialization Corporation’’.
(2) Section 730 of the Federal Agriculture Improvement
and Reform Act of 1996 (7 U.S.C. 5902 note; Public Law 104–
127) is repealed.
(3) Section 211(b) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6911(b)) is amended by striking
paragraph (5).
(4) Section 404(d) of the Agricultural Research, Extension,
and Education Reform Act of 1998 (7 U.S.C. 7624(d)) is
amended—
(A) by striking paragraph (2); and
(B) by redesignating paragraphs (3) and (4) as paragraphs (2) and (3), respectively.
(5) The Herger-Feinstein Quincy Library Group Forest
Recovery Act (16 U.S.C. 2104; Public Law 105–277; 112 Stat.
2681–305) is amended by striking subsection (m).
(6) Section 9101(3) of title 31, United States Code, is
amended by striking subparagraph (Q).

7 USC 5901 note.

5 USC 5315.

31 USC 9101.

SEC. 6202. RURAL ELECTRONIC COMMERCE EXTENSION PROGRAM.

Subtitle H of title XVI of the Food, Agriculture, Conservation,
and Trade Act of 1990 is amended by inserting after section 1669
(7 U.S.C. 5922) the following:
‘‘SEC. 1670. RURAL ELECTRONIC COMMERCE EXTENSION PROGRAM.

7 USC 5923.

‘‘(a) DEFINITIONS.—In this section:
‘‘(1) DEVELOPMENT CENTER.—The term ‘development center’
means—
‘‘(A) the North Central Regional Center for Rural
Development;

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‘‘(B) the Northeast Regional Center for Rural Development or its designee;
‘‘(C) the Southern Rural Development Center; and
‘‘(D) the Western Rural Development Center or its
designee.
‘‘(2) EXTENSION PROGRAM.—The term ‘extension program’
means the rural electronic commerce extension program established under subsection (b).
‘‘(3) MICROENTERPRISE.—The term ‘microenterprise’ means
a commercial enterprise that has 5 or fewer employees, 1 or
more of whom own the enterprise.
‘‘(4) SECRETARY.—The term ‘Secretary’ means the Secretary
of Agriculture, acting through the Administrator of the Cooperative State Research, Education, and Extension Service.
‘‘(5) SMALL BUSINESS.—The term ‘small business’ has the
meaning given the term ‘small-business concern’ by section
3(a) of the Small Business Act (15 U.S.C. 632(a)).
‘‘(b) ESTABLISHMENT.—The Secretary shall establish a rural
electronic commerce extension program to expand and enhance
electronic commerce practices and technology to be used by small
businesses and microenterprises in rural areas.
‘‘(c) GRANTS.—
‘‘(1) IN GENERAL.—The Secretary shall carry out the program established under subsection (b) by making—
‘‘(A) grants to each of the development centers; and
‘‘(B) competitive grants to land-grant colleges and
universities (or consortia of land-grant colleges and universities) and to colleges and universities (including community colleges) with agricultural or rural development
programs—
‘‘(i) to develop and facilitate innovative rural electronic commerce business strategies; and
‘‘(ii) to assist small businesses and microenterprises in identifying, adapting, implementing, and
using electronic commerce business practices and technologies.
‘‘(2) ELIGIBILITY.—The selection criteria established for
grants awarded under paragraph (1)(B) shall include—
‘‘(A) the ability of an applicant to provide training
and education on best practices, technology transfer, adoption, and use of electronic commerce in rural communities
by small businesses and microenterprises;
‘‘(B) the extent and geographic diversity of the area
served by the proposed project or activity under the extension program;
‘‘(C) in the case of a land-grant college or university,
the extent of participation of the land-grant college or
university in the extension program (including any economic benefits that would result from that participation);
‘‘(D) the percentage of funding and in-kind commitments from non-Federal sources that would be needed by
and available for a proposed project or activity under the
extension program; and
‘‘(E) the extent of participation of low-income and
minority businesses or microenterprises in a proposed
project or activity under the extension program.
‘‘(3) NON-FEDERAL SHARE.—

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‘‘(A) IN GENERAL.—As a condition of the receipt of
funds under this section, a development center or grant
applicant shall agree to obtain from non-Federal sources
(including State, local, nonprofit, or private sector sources)
contributions of an amount equal to 50 percent of the
grant amount.
‘‘(B) FORM.—The non-Federal share required under
subparagraph (A) may be provided in the form of in-kind
contributions.
‘‘(C) EXCEPTION.—The non-Federal share required
under subparagraph (A) may be reduced to 25 percent
if the grant recipient serves low-income or minority-owned
businesses or microenterprises, as determined by the Secretary.
‘‘(d) REPORT.—Not later than 2 years after the date of enactment of this section, the Secretary shall submit to the Committee
on Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a report
that describes—
‘‘(1) the policies, practices, and procedures used to assist
rural communities in efforts to adopt and use electronic commerce techniques; and
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $60,000,000 for each
of fiscal years 2002 through 2007, of which not less than 1⁄3 of
the amount made available for each fiscal year shall be used to
carry out activities under subsection (c)(1)(A).’’.

Deadline.

SEC. 6203. TELEMEDICINE AND DISTANCE LEARNING SERVICES IN
RURAL AREAS.

(a) IN GENERAL.—Section 2335A of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 950aaa–5) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
(b) CONFORMING AMENDMENT.—Section 1(b) of Public Law 102–
551 (7 U.S.C. 950aaa note) is amended by striking ‘‘1997’’ and
inserting ‘‘2007’’.

Subtitle D—SEARCH Grants for Small
Communities
SEC. 6301. DEFINITIONS.

7 USC 2009ee.

In this subtitle:
(1) COUNCIL.—The term ‘‘council’’ means an independent
citizens’ council established by a State rural development
director under section 6302(c).
(2) ENVIRONMENTAL PROJECT.—
(A) IN GENERAL.—The term ‘‘environmental project’’
means a project that—
(i) improves environmental quality; and
(ii) is necessary to comply with an applicable
environmental law (including a regulation).
(B) INCLUSION.—The term ‘‘environmental project’’
includes an initial feasibility study of a project.
(3) REGION.—The term ‘‘region’’ means a geographic area
of a State, as determined by the State rural development

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director, in coordination with the environmental protection
director of the State.
(4) SEARCH GRANT.—The term ‘‘SEARCH grant’’ means
a grant awarded under section 6302(f).
(5) SECRETARY.—The term ‘‘Secretary’’ means the Secretary
of Agriculture.
(6) SMALL COMMUNITY.—The term ‘‘small community’’
means an incorporated or unincorporated rural community with
a population of 2,500 inhabitants or less.
(7) STATE.—The term ‘‘State’’ has the meaning given the
term in section 381A of the Consolidated Farm and Rural
Development Act (7 U.S.C. 2009).

7 USC 2009ee–1.

Deadline.

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SEC. 6302. SEARCH GRANT PROGRAM.

(a) IN GENERAL.—The Secretary, in coordination with the
Administrator of the Environmental Protection Agency, may establish the SEARCH grant program.
(b) ALLOCATION TO STATE RURAL DEVELOPMENT DIRECTORS.—
(1) IN GENERAL.—Subject to paragraph (2) and section
6304(a)(2), not later than 60 days after the date on which
the Director of the Office of Management and Budget apportions
any amounts made available under this subtitle for any of
fiscal years 2002 through 2007, the Secretary, on request of
a State rural development director (in coordination with the
environmental protection director of the State), shall allocate
to the State rural development director an amount not to exceed
$1,000,000, to be used by the State rural development director
to award SEARCH grants under subsection (d).
(2) GRANTS TO STATES.—The total amount of funds allocated
to State rural development directors in all States other than
Alaska, Hawaii, or the 48 contiguous States for a fiscal year
under this subsection shall not exceed $1,000,000.
(c) INDEPENDENT CITIZENS’ COUNCIL.—
(1) ESTABLISHMENT.—The State rural development director
of a State shall establish an independent citizens’ council to
carry out the duties described in this section.
(2) COMPOSITION.—
(A) IN GENERAL.—A council shall be composed of 9
members, appointed by the State rural development
director, in coordination with the environmental protection
director of the State.
(B) REPRESENTATION; RESIDENCE.—Each member of a
council shall—
(i) represent an individual region of the State,
as determined by the State rural development director;
and
(ii) reside in a small community in the State.
(d) ELIGIBILITY.—A SEARCH grant shall be awarded under
this section only to a small community for 1 or more environmental
projects for which the small community—
(1) needs funds to carry out initial feasibility or environmental studies as required by Federal or State law before
applying to traditional funding sources; and
(2) demonstrates that the small community has been
unable to obtain sufficient funding from traditional funding
sources.

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(e) APPLICATIONS.—To be eligible to receive a SEARCH grant,
a small community in a State shall submit to the State rural
development director of the State an application that includes—
(1) a description of the proposed environmental project
(including an explanation of how the project would assist the
small community in complying with a Federal or State environmental law (including a regulation);
(2) an explanation of why the project is important to the
small community;
(3) a description of all actions taken with respect to the
project as of the date of the application, including any attempt
to secure funding; and
(4) a description of demonstrated need for funding for the
project.
(f) AWARDS.—
(1) IN GENERAL.—Not later than May 1 of each fiscal year,
a State rural development director, in coordination with the
council and the environmental protection director of the State,
shall—
(A) review all applications received by the State rural
development director under subsection (e); and
(B) award SEARCH grants to small communities based
on—
(i) an evaluation of whether the proposed project
meets the eligibility criteria under subsection (d); and
(ii) the content of the application.
(2) ADMINISTRATION.—In awarding a SEARCH grant, a
State rural development director—
(A) shall award the funds for any recommended
environmental project in a timely and expeditious manner;
and
(B) shall not award a SEARCH grant to a grantee
or project in violation of any Federal or State law (including
a regulation).
(3) MATCHING REQUIREMENT.—A small community that
receives a SEARCH grant under this section may be required
to provide matching funds.
(g) UNEXPENDED FUNDS.—
(1) IN GENERAL.—If, for any fiscal year, any unexpended
funds remain after SEARCH grants are awarded by a State
rural development director under subsection (f), the State rural
development director, in coordination with the environmental
protection director of the State, may repeat the application
and review process so that any remaining funds are recommended for award, and awarded, not later than July 30
of the fiscal year.
(2) RETENTION OF FUNDS.—
(A) IN GENERAL.—Any unexpended funds that are not
awarded under subsection (f) or paragraph (1) shall be
retained by the State rural development director for award
during the following fiscal year.
(B) LIMITATION.—A State SEARCH account that
accumulates a balance of unexpended funds described in
subparagraph (A) in excess of $2,000,000 shall be ineligible
to receive additional funds for SEARCH grants until such
time as the State rural development director awards grants
in the amount of the excess.

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PUBLIC LAW 107–171—MAY 13, 2002

Deadline.
7 USC 2009ee–2.

SEC. 6303. REPORT.

7 USC 2009ee–3.

SEC. 6304. FUNDING.

Not later than 30 days after the end of the first fiscal year
for which SEARCH grants are awarded, and annually thereafter,
the Secretary shall submit to the Committee on Energy and Commerce and the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry
of the Senate a report that—
(1) describes the number of SEARCH grants awarded
during the fiscal year;
(2) identifies each small community that received a
SEARCH grant during the fiscal year;
(3) describes the project or purpose for which each SEARCH
grant was awarded, including a statement of the benefit to
public health or the environment of the environmental project
receiving the grant funds; and
(4) describes the status of each project or portion of a
project for which a SEARCH grant was awarded, including
a project or portion of a project for which a SEARCH grant
was awarded for any previous fiscal year.
(a) ALLOCATION TO STATE RURAL DEVELOPMENT DIRECTORS.—
(1) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out section 6302(b) $51,000,000
for each of fiscal years 2002 through 2007, of which not to
exceed $1,000,000 shall be used to make grants under section
6302(b)(2).
(2) ACTUAL APPROPRIATION.—If funds to carry out section
6302(b) are made available for a fiscal year in an amount
that is less than the amount authorized under paragraph (1)
for the fiscal year, the Secretary shall divide the appropriated
funds for the fiscal year equally among the 50 States.
(b) OTHER EXPENSES.—There are authorized to be appropriated
such sums as are necessary to carry out this subtitle (other than
section 6302(b)).

Subtitle E—Miscellaneous
SEC.

6401.

VALUE-ADDED AGRICULTURAL
DEVELOPMENT GRANTS.

PRODUCT

MARKET

(a) IN GENERAL.—Section 231 of the Agricultural Risk Protection Act of 2000 (7 U.S.C. 1621 note; Public Law 106–224) is
amended—
(1) by redesignating subsections (b) through (d) as subsections (c) through (e), respectively;
(2) by striking subsection (a) and inserting the following:
‘‘(a) DEFINITION OF VALUE-ADDED AGRICULTURAL PRODUCT.—
‘‘(1) IN GENERAL.—The term ‘value-added agricultural
product’ means any agricultural commodity or product that—
‘‘(A)(i) has undergone a change in physical state;
‘‘(ii) was produced in a manner that enhances the
value of the agricultural commodity or product, as demonstrated through a business plan that shows the enhanced
value, as determined by the Secretary; or

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‘‘(iii) is physically segregated in a manner that results
in the enhancement of the value of the agricultural commodity or product; and
‘‘(B) as a result of the change in physical state or
the manner in which the agricultural commodity or product
was produced or segregated—
‘‘(i) the customer base for the agricultural commodity or product has been expanded; and
‘‘(ii) a greater portion of the revenue derived from
the marketing, processing, or physical segregation of
the agricultural commodity or product is available to
the producer of the commodity or product.
‘‘(2) INCLUSION.—The term ‘value-added agricultural
product’ includes farm- or ranch-based renewable energy.
‘‘(b) GRANT PROGRAM.—
‘‘(1) IN GENERAL.—From amounts made available under
paragraph (4), the Secretary shall award competitive grants—
‘‘(A) to an eligible independent producer (as determined
by the Secretary) of a value-added agricultural product
to assist the producer—
‘‘(i) in developing a business plan for viable marketing opportunities for the value-added agricultural
product; or
‘‘(ii) in developing strategies that are intended to
create marketing opportunities for the producer; and
‘‘(B) to an eligible agricultural producer group, farmer
or rancher cooperative, or majority-controlled producerbased business venture (as determined by the Secretary)
to assist the entity—
‘‘(i) in developing a business plan for viable marketing opportunities in emerging markets for a valueadded agricultural product; or
‘‘(ii) in developing strategies that are intended to
create marketing opportunities in emerging markets
for the value-added agricultural product.
‘‘(2) AMOUNT OF GRANT.—
‘‘(A) IN GENERAL.—The total amount provided under
this subsection to a grant recipient shall not exceed
$500,000.
‘‘(B) MAJORITY-CONTROLLED PRODUCER-BASED BUSINESS
VENTURES.—The amount of grants provided to majoritycontrolled producer-based business ventures under paragraph (1)(B) for a fiscal year may not exceed 10 percent
of the amount of funds that are used to make grants
for the fiscal year under this subsection.
‘‘(3) GRANTEE STRATEGIES.—A grantee under paragraph (1)
shall use the grant—
‘‘(A) to develop a business plan or perform a feasibility
study to establish a viable marketing opportunity for a
value-added agricultural product; or
‘‘(B) to provide capital to establish alliances or business
ventures that allow the producer of the value-added agricultural product to better compete in domestic or international
markets.
‘‘(4) FUNDING.—Not later than 30 days after the date of
enactment of this paragraph, on October 1, 2002, and on each
October 1 thereafter through October 1, 2006, of the funds

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116 STAT. 426

of the Commodity Credit Corporation, the Secretary shall make
available to carry out this subsection $40,000,000, to remain
available until expended.’’;
(3) in subsection (c)(1) (as redesignated by paragraph (1))—
(A) by striking ‘‘subsection (a)(2)’’ and inserting ‘‘subsection (b)(2)’’;
(B) by striking ‘‘$5,000,000’’ and inserting ‘‘5 percent’’;
and
(C) by striking ‘‘subsection (a)’’ and inserting ‘‘subsection (b)’’; and
(4) in subsection (d) (as redesignated by paragraph (1)),
by striking ‘‘subsections (a) and (b)’’ and inserting ‘‘subsections
(b) and (c)’’.
(b) APPLICABILITY.—
(1) IN GENERAL.—Except as provided in paragraph (2), the
amendments made by subsection (a) apply beginning on October
1, 2002.
(2) FUNDING.—Funds made available under section
231(b)(4)(A)(i) of the Agricultural Risk Protection Act of 2000
(as amended by subsection (a)(2)) shall be made available not
later than 30 days after the date of enactment of this Act.

7 USC 1621 note.
Effective date.

Deadline.

7 USC 1621 note.

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SEC. 6402. AGRICULTURE INNOVATION CENTER DEMONSTRATION PROGRAM.

(a) PURPOSE.—The purpose of this section is to direct the Secretary of Agriculture to establish a demonstration program under
which agricultural producers are provided—
(1) technical assistance, consisting of engineering services,
applied research, scale production, and similar services, to
enable the agricultural producers to establish businesses to
produce value-added agricultural commodities or products;
(2) assistance in marketing, market development, and business planning; and
(3) organizational, outreach, and development assistance
to increase the viability, growth, and sustainability of
businesses that produce value-added agricultural commodities
or products.
(b) DEFINITIONS.—In this section:
(1) PROGRAM.—The term ‘‘Program’’ means the Agriculture
Innovation Center Demonstration Program established under
subsection (c).
(2) SECRETARY.—The term ‘‘Secretary’’ means the Secretary
of Agriculture.
(c) ESTABLISHMENT OF PROGRAM.—The Secretary shall establish
a demonstration program, to be known as the ‘‘Agriculture Innovation Center Demonstration Program’’ under which the Secretary
shall—
(1) make grants to assist eligible entities in establishing
Agriculture Innovation Centers to enable agricultural producers
to obtain the assistance described in subsection (a); and
(2) provide assistance to eligible entities in establishing
Agriculture Innovation Centers through the research and technical services of the Department of Agriculture.
(d) ELIGIBILITY REQUIREMENTS.—
(1) IN GENERAL.—An entity shall be eligible for a grant
and assistance described in subsection (c) to establish an Agriculture Innovation Center if—

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(A) the entity—
(i) has provided services similar to the services
described in subsection (a); or
(ii) demonstrates the capability of providing such
services;
(B) the application of the entity for the grant and
assistance includes a plan, in accordance with regulations
promulgated by the Secretary, that outlines—
(i) the support for the entity in the agricultural
community;
(ii) the technical and other expertise of the entity;
and
(iii) the goals of the entity for increasing and
improving the ability of local agricultural producers
to develop markets and processes for value-added agricultural commodities or products;
(C) the entity demonstrates that adequate resources
(in cash or in kind) are available, or have been committed
to be made available, to the entity, to increase and improve
the ability of local agricultural producers to develop markets and processes for value-added agricultural commodities or products; and
(D) the Agriculture Innovation Center of the entity
has a board of directors established in accordance with
paragraph (2).
(2) BOARD OF DIRECTORS.—Each Agriculture Innovation
Center of an eligible entity shall have a board of directors
composed of representatives of each of the following groups:
(A) The 2 general agricultural organizations with the
greatest number of members in the State in which the
eligible entity is located.
(B) The department of agriculture, or similar State
department or agency, of the State in which the eligible
entity is located.
(C) Entities representing the 4 highest grossing
commodities produced in the State, determined on the basis
of annual gross cash sales.
(e) GRANTS AND ASSISTANCE.—
(1) IN GENERAL.—Subject to subsection (i), under the Program, the Secretary shall make, on a competitive basis, annual
grants to eligible entities.
(2) MAXIMUM AMOUNT OF GRANTS.—A grant under paragraph (1) shall be in an amount that does not exceed the
lesser of—
(A) $1,000,000; or
(B) twice the dollar amount of the resources (in cash
or in kind) that the eligible entity demonstrates are available, or have been committed to be made available, to
the eligible entity in accordance with subsection (d)(1)(C).
(3) MAXIMUM NUMBER OF GRANTS.—
(A) FIRST FISCAL YEAR OF PROGRAM.—In the first fiscal
year of the Program, the Secretary shall make grants to
not more than 5 eligible entities.
(B) SECOND FISCAL YEAR OF PROGRAM.—In the second
fiscal year of the Program, the Secretary may make grants
to—

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(i) the eligible entities to which grants were made
under subparagraph (A); and
(ii) not more than 10 additional eligible entities.
(4) STATE LIMITATION.—
(A) IN GENERAL.—Subject to subparagraph (B), in the
first 3 fiscal years of the Program, the Secretary shall
not make a grant under the Program to more than 1
entity in any 1 State.
(B) COLLABORATION.—Nothing in subparagraph (A)
precludes a recipient of a grant under the Program from
collaborating with any other institution with respect to
activities conducted using the grant.
(f) USE OF FUNDS.—An eligible entity to which a grant is
made under the Program may use the grant only for the following
purposes (but only to the extent that the use is not described
in section 231(d) of the Agricultural Risk Protection Act of 2000
(7 U.S.C. 1621 note; Public Law 106–224)):
(1) Applied research.
(2) Consulting services.
(3) Hiring of employees, at the discretion of the board
of directors of the Agriculture Innovation Center of the eligible
entity.
(4) The making of matching grants, each of which shall
be in an amount not to exceed $5,000, to agricultural producers,
except that the aggregate amount of all such matching grants
made by the eligible entity shall be not more than $50,000.
(5) Legal services.
(6) Any other related cost, as determined by the Secretary.
(g) RESEARCH ON EFFECTS ON THE AGRICULTURAL SECTOR.—
(1) IN GENERAL.—Of the amount made available under
subsection (i) for each fiscal year, the Secretary shall use
$300,000 to support research at a university concerning the
effects of projects for value-added agricultural commodities or
products on agricultural producers and the commodity markets.
(2) RESEARCH ELEMENTS.—Research under paragraph (1)
shall systematically examine, using linked, long-term, global
projections of the agricultural sector, the potential effects of
projects described in subparagraph (A) on—
(A) demand for agricultural commodities;
(B) market prices;
(C) farm income; and
(D) Federal outlays on commodity programs.
(h) REPORT TO CONGRESS.—
(1) IN GENERAL.—Not later than 3 years after the date
on which the last of the first 10 grants is made under the
Program, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a report
on—
(A) the effectiveness of the Program in improving and
expanding the production of value-added agricultural
commodities or products; and
(B) the effects of the Program on the economic viability
of agricultural producers.
(2) REQUIRED ELEMENTS.—The report under paragraph (1)
shall—

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(A) include a description of the best practices and
innovations found at each of the Agriculture Innovation
Centers established under the Program; and
(B) specify the number and type of activities assisted,
and the type of assistance provided, under the Program.
(i) FUNDING.—Of the amount made available under section
231(a)(1) of the Agricultural Risk Protection Act of 2000 (7 U.S.C.
1621 note; Public Law 106–224) for each fiscal year, the Secretary
shall use to carry out this section—
(1) not less than $3,000,000 for fiscal year 2002; and
(2) not less than $6,000,000 for each of fiscal years 2003
and 2004.
SEC. 6403. FUND FOR RURAL AMERICA.

(a) IN GENERAL.—Section 793 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 2204f) is repealed.
(b) CONFORMING AMENDMENT.—Section 2(b)(8)(B) of the
Competitive, Special, and Facilities Research Grant Act (7 U.S.C.
450i(b)(8)(B)) is amended in the second sentence by striking ‘‘smaller
college or university (as described in section 793(c)(2)(ii) of the
Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C.
2204f(c)(2)(ii))’’ and inserting ‘‘college, university, or research
foundation maintained by a college or university that ranks in
the lowest 1⁄3 of such colleges, universities, and research foundations
on the basis of Federal research funds received’’.
SEC. 6404. RURAL LOCAL TELEVISION BROADCAST SIGNAL LOAN
GUARANTEES.

(a) IN GENERAL.—Section 1011(a) of the Launching Our
Communities’ Access to Local Television Act of 2000 (47 U.S.C.
1109(a)) is amended—
(1) by striking ‘‘For’’ and inserting the following:
‘‘(1) AUTHORIZATION OF APPROPRIATIONS.—For’’; and
(2) by adding at the end the following:
‘‘(2) COMMODITY CREDIT CORPORATION FUNDS.—
‘‘(A) IN GENERAL.—Notwithstanding any other provision of law, subject to subparagraph (B), in addition to
amounts made available under paragraph (1), of the funds
of the Commodity Credit Corporation, the Secretary of
Agriculture shall make available for loan guarantees to
carry out this title $80,000,000 for the period beginning
on the date of enactment of this paragraph and ending
on December 31, 2006, to remain available until expended.
‘‘(B) BROADBAND LOANS AND LOAN GUARANTEES.—
‘‘(i) IN GENERAL.—Amounts made available under
subparagraph (A) that are not obligated as of the
release date described in clause (ii) shall be available
to the Secretary to make loans and loan guarantees
under section 601 of the Rural Electrification Act of
1936.
‘‘(ii) RELEASE DATE.—For purposes of clause (i),
the release date is the date that is the earlier of—
‘‘(I) the date the Secretary determines that
at least 75 percent of the designated market areas
(as defined in section 122(j) of title 17, United
States Code) not in the top 40 designated market
areas described in section 1004(e)(1)(C)(i) of the

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Launching Our Communities’ Access to Local Television Act of 2000 (47 U.S.C. 1103(e)(1)(C)(i)) have
access to local television broadcast signals for virtually all households (as determined by the Secretary); or
‘‘(II) December 31, 2006.
‘‘(C) ADVANCED APPROPRIATIONS.—Subsections (c) and
(h)(1)(B) of section 1004 and section 1005(n)(3)(B) shall
not apply to amounts made available under this paragraph.’’.
(b) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) APPROVAL OF LOAN GUARANTEES.—Section 1004 of the
Launching Our Communities’ Access to Local Television Act
of 2000 (47 U.S.C. 1103) is amended—
(A) in subsection (b)(1)—
(i) by striking ‘‘section 5’’ and inserting ‘‘section
1005’’; and
(ii) by striking ‘‘section 11’’ and inserting ‘‘section
1011’’;
(B) in subsection (d)(1), by striking ‘‘section 3’’ and
inserting ‘‘section 1003’’; and
(C) in the first sentence of subsection (h)(2)(D), by
striking ‘‘section 5’’ and inserting ‘‘section 1005’’.
(2) ADMINISTRATION OF LOAN GUARANTEES.—Section 1005
of the Launching Our Communities’ Access to Local Television
Act of 2000 (47 U.S.C. 1104) is amended—
(A) in subsection (a), by striking ‘‘sections 3 and 4’’
and inserting ‘‘sections 1003 and 1004’’;
(B) in subsection (b)—
(i) in paragraph (1)(D), by striking ‘‘section 6(a)(2)’’
and inserting ‘‘section 1006(a)(2)’’; and
(ii) in paragraph (3), by striking ‘‘section
4(d)(3)(B)(iii)’’ and inserting ‘‘section 1004(d)(3)(B)(iii)’’;
and
(C) in subsection (e)(3), by striking ‘‘section 4(g)’’ and
inserting ‘‘section 1004(g)’’.

7 USC 2655.

SEC. 6405. RURAL FIREFIGHTERS AND EMERGENCY PERSONNEL
GRANT PROGRAM.

(a) IN GENERAL.—The Secretary of Agriculture may make
grants to units of general local government and Indian tribes (as
defined in section 4 of the Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b)) to pay the cost of training firefighters and emergency medical personnel in firefighting, emergency
medical practices, and responding to hazardous materials and bioagents in rural areas.
(b) USE OF FUNDS.—
(1) SCHOLARSHIPS.—
(A) IN GENERAL.—Not less than 60 percent of the
amounts made available for competitively-awarded grants
under this section shall be used to provide grants to fund
partial scholarships for training of individuals at training
centers approved by the Secretary.
(B) PRIORITY.—In awarding grants under this paragraph, the Secretary shall give priority to grant applicants
that provide for training within the region (or locality)
of the applicant.

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(2) GRANTS FOR TRAINING CENTERS.—
(A) IN GENERAL.—A grant under subsection (a) may
be used to provide financial assistance to State and regional
centers that provide training for firefighters and emergency
medical personnel for improvements to the training facility,
equipment, curricula, and personnel.
(B) LIMITATION.—Not more than $750,000 shall be provided to any single training center for any fiscal year
under this paragraph.
(c) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall make available to carry out this section
$10,000,000 for each of fiscal years 2003 through 2007, to remain
available until expended.
SEC. 6406. SENSE OF CONGRESS ON RURAL POLICY COORDINATION.

It is the sense of Congress that the President should—
(1) appoint a Special Assistant to the President for Rural
Policy;
(2) designate within each Federal agency with jurisdiction
over rural programs or activities 1 or more senior officers
or employees to provide rural policy leadership for the agency;
and
(3) create an intergovernmental rural policy working group
comprised of—
(A) the Special Assistant to the President for Rural
Policy, who should serve as Chairperson; and
(B) the senior officers and employees designated under
paragraph (2).

TITLE VII—RESEARCH AND RELATED
MATTERS
Subtitle A—Extensions
SEC. 7101. NATIONAL RURAL INFORMATION CENTER CLEARINGHOUSE.

Section 2381(e) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (7 U.S.C. 3125b(e)) is amended by striking
‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7102. GRANTS AND FELLOWSHIPS FOR FOOD AND AGRICULTURAL
SCIENCES EDUCATION.

Section 1417 of the National Agricultural Research, Extension,
and Teaching Policy Act of 1977 (7 U.S.C. 3152) is amended—
(1) in subsection (a)—
(A) by striking ‘‘and’’ after ‘‘economics,’’; and
(B) by inserting ‘‘, and rural economic, community,
and business development’’ before the period;
(2) in subsection (b)—
(A) in paragraph (1), by inserting ‘‘, or in rural economic, community, and business development’’ before the
semicolon;
(B) in paragraph (2), by inserting ‘‘, or in rural economic, community, and business development’’ before the
semicolon;

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(C) in paragraph (3), by inserting ‘‘, or teaching programs emphasizing rural economic, community, and business development’’ before the semicolon;
(D) in paragraph (4), by inserting ‘‘, or programs
emphasizing rural economic, community, and business
development,’’ after ‘‘programs’’; and
(E) in paragraph (5), by inserting ‘‘, or professionals
in rural economic, community, and business development’’
before the semicolon;
(3) in subsection (d)—
(A) in paragraph (1), by inserting ‘‘, or in rural economic, community, and business development,’’ after
‘‘sciences’’; and
(B) in paragraph (2), by inserting ‘‘, or in the rural
economic,
community,
and
business
development
workforce,’’ after ‘‘workforce’’; and
(4) in subsection (l), by striking ‘‘2002’’ and inserting ‘‘2007’’.

SEC. 7103. POLICY RESEARCH CENTERS.

Section 1419A(d) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3155(d)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7104. HUMAN NUTRITION INTERVENTION AND HEALTH PROMOTION RESEARCH PROGRAM.

Section 1424(d) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3174(d)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7105. PILOT RESEARCH PROGRAM TO COMBINE MEDICAL AND
AGRICULTURAL RESEARCH.

Section 1424A(d) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3174a(d)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7106. NUTRITION EDUCATION PROGRAM.

Section 1425(c)(3) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3175(c)(3)) is
amended by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7107. CONTINUING ANIMAL HEALTH AND DISEASE RESEARCH
PROGRAMS.

Section 1433(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3195(a)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7108. APPROPRIATIONS FOR RESEARCH ON NATIONAL OR
REGIONAL PROBLEMS.

Section 1434(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3196(a)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7109. GRANTS TO UPGRADE AGRICULTURAL AND FOOD SCIENCES
FACILITIES AT 1890 LAND-GRANT COLLEGES, INCLUDING
TUSKEGEE UNIVERSITY.

Section 1447(b) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222b(b)) is amended
by striking ‘‘$15,000,000 for each of fiscal years 1996 through 2002’’

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and inserting ‘‘$25,000,000 for each of fiscal years 2002 through
2007’’.
SEC. 7110. NATIONAL RESEARCH AND TRAINING VIRTUAL CENTERS.

(a) AUTHORIZATION.—Section 1448 of the National Agricultural
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3222c) is amended by striking ‘‘2002’’ each place it appears in
subsections (a)(1) and (f) and inserting ‘‘2007’’.
(b) REDESIGNATION.—Section 1448 of the National Agricultural
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3222c) is amended—
(1) in the section heading, by striking ‘‘CENTENNIAL’’ and
inserting ‘‘VIRTUAL’’; and
(2) by striking ‘‘centennial’’ each place it appears and
inserting ‘‘virtual’’.
SEC. 7111. HISPANIC-SERVING INSTITUTIONS.

Section 1455(c) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3241(c)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7112. COMPETITIVE GRANTS FOR INTERNATIONAL AGRICULTURAL SCIENCE AND EDUCATION PROGRAMS.

Section 1459A(c) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3292b(c)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7113. UNIVERSITY RESEARCH.

Section 1463 of the National Agricultural Research, Extension,
and Teaching Policy Act of 1977 (7 U.S.C. 3311) is amended—
(1) in subsection (a), by striking ‘‘$850,000,000 for each
of the fiscal years 1991 through 2002’’ and inserting ‘‘such
sums as may be necessary for each of fiscal years 1991 through
2007’’; and
(2) in subsection (b), by striking ‘‘$310,000,000 for each
of the fiscal years 1991 through 2002’’ and inserting ‘‘such
sums as may be necessary for each of fiscal years 1991 through
2007’’.
SEC. 7114. EXTENSION SERVICE.

Section 1464 of the National Agricultural Research, Extension,
and Teaching Policy Act of 1977 (7 U.S.C. 3312) is amended by
striking ‘‘$420,000,000 for fiscal year 1991, $430,000,000 for fiscal
year 1992, $440,000,000 for fiscal year 1993, $450,000,000 for fiscal
year 1994, and $460,000,000 for each of fiscal years 1995 through
2002’’ and inserting ‘‘such sums as may be necessary for each
of fiscal years 1991 through 2007’’.
SEC. 7115. SUPPLEMENTAL AND ALTERNATIVE CROPS.

Section 1473D(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3319d(a)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7116. AQUACULTURE RESEARCH FACILITIES.

The first sentence of section 1477 of the National Agricultural
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3324) is amended by striking ‘‘2002’’ and inserting ‘‘2007’’.

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SEC. 7117. RANGELAND RESEARCH.

Section 1483(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3336(a)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7118. NATIONAL GENETICS RESOURCES PROGRAM.

Section 1635(b) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (7 U.S.C. 5844(b)) is amended by striking ‘‘2002’’
and inserting ‘‘2007’’.
SEC. 7119. HIGH-PRIORITY RESEARCH AND EXTENSION INITIATIVES.

Section 1672(h) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (7 U.S.C. 5925(h)) is amended by striking ‘‘2002’’
and inserting ‘‘2007.
SEC. 7120. NUTRIENT MANAGEMENT RESEARCH AND EXTENSION INITIATIVE.

Section 1672A(g) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (7 U.S.C. 5925a(g)) is amended by striking
‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7121. AGRICULTURAL TELECOMMUNICATIONS PROGRAM.

Section 1673(h) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (7 U.S.C. 5926(h)) is amended by striking ‘‘2002’’
and inserting ‘‘2007’’.
SEC. 7122. ASSISTIVE TECHNOLOGY PROGRAM FOR FARMERS WITH
DISABILITIES.

Section 1680(c)(1) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (7 U.S.C. 5933(c)(1)) is amended by striking
‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7123. PARTNERSHIPS FOR HIGH-VALUE AGRICULTURAL PRODUCT
QUALITY RESEARCH.

Section 402(g) of the Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C. 7622(g)) is amended by
striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7124. BIOBASED PRODUCTS.

(a) PILOT PROJECT.—Section 404(e)(2) of the Agricultural
Research, Extension, and Education Reform Act of 1998 (7 U.S.C.
7624(e)(2)) is amended by striking ‘‘2001’’ and inserting ‘‘2007’’.
(b) AUTHORIZATION OF APPROPRIATIONS.—Section 404(h) of such
Act (7 U.S.C. 7624(h)) is amended by striking ‘‘2002’’ and inserting
‘‘2007’’.
SEC. 7125. INTEGRATED RESEARCH, EDUCATION, AND EXTENSION
COMPETITIVE GRANTS PROGRAM.

Section 406 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7626) is amended—
(1) by redesignating subsection (e) as subsection (f);
(2) by inserting after subsection (d) the following:
‘‘(e) TERM OF GRANT.—A grant under this section shall have
a term of not more than 5 years.’’; and
(3) in subsection (f) (as so redesignated), by striking ‘‘2002’’
and inserting ‘‘2007’’.

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SEC. 7126. EQUITY IN EDUCATIONAL LAND-GRANT STATUS ACT OF
1994.

(f) INSTITUTIONAL CAPACITY BUILDING GRANTS.—Section 535
of the Equity in Educational Land-Grant Status Act of 1994 (7
U.S.C. 301 note; Public Law 103–382) is amended—
(1) in subsection (b)(1), by striking ‘‘2002’’ and inserting
‘‘2007’’; and
(2) in subsection (c), by striking ‘‘$1,700,000 for each of
fiscal years 1996 through 2002’’ and inserting ‘‘such sums as
are necessary for each of fiscal years 2002 through 2007’’.
SEC. 7127. 1994 INSTITUTION RESEARCH GRANTS.

Section 536(c) of the Equity in Educational Land-Grant Status
Act of 1994 (7 U.S.C. 301 note) is amended by striking ‘‘2002’’
and inserting ‘‘2007’’.
SEC. 7128. ENDOWMENT FOR 1994 INSTITUTIONS.

The first sentence of section 533(b) of the Equity in Educational
Land-Grant Status Act of 1994 (7 U.S.C. 301 note) is amended
by striking ‘‘$4,600,000’’ and all that follows through the period
and inserting ‘‘such sums as are necessary to carry out this section
for each of fiscal years 1996 through 2007.’’.
SEC. 7129. PRECISION AGRICULTURE.

Section 403(i) of the Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C. 7623(i)) is amended by
striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7130. THOMAS JEFFERSON INITIATIVE FOR CROP DIVERSIFICATION.

Section 405(h) of the Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C. 7625(h)) is amended by
striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7131. SUPPORT FOR RESEARCH REGARDING DISEASES OF WHEAT,
TRITICALE, AND BARLEY CAUSED BY FUSARIUM
GRAMINEARUM OR BY TILLETIA INDICA.

Section 408(e) of the Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C. 7628(e)) is amended—
(1) by striking ‘‘$5,200,000’’ and inserting ‘‘such sums as
may be necessary’’; and
(2) by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7132. OFFICE OF PEST MANAGEMENT POLICY.

Section 614(f) of the Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C. 7653(f)) is amended by
striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7133. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, EDUCATION, AND ECONOMICS ADVISORY BOARD.

Section 1408(h) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3123(h)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.

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SEC. 7134. GRANTS FOR RESEARCH ON PRODUCTION AND MARKETING
OF ALCOHOLS AND INDUSTRIAL HYDROCARBONS FROM
AGRICULTURAL COMMODITIES AND FOREST PRODUCTS.

Section 1419(d) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3154(d)) is amended
by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7135. AGRICULTURAL EXPERIMENT STATIONS RESEARCH FACILITIES.

Section 6(a) of the Research Facilities Act (7 U.S.C. 390d(a))
is amended by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC.

7136.

COMPETITIVE, SPECIAL, AND FACILITIES
GRANTS NATIONAL RESEARCH INITIATIVE.

RESEARCH

Section 2(b)(10) of the Competitive, Special, and Facilities
Research Grant Act (7 U.S.C. 450i(b)(10)) is amended by striking
‘‘2002’’ and inserting ‘‘2007’’.
SEC.

7137.

FEDERAL
AGRICULTURAL
RESEARCH
AUTHORIZATION OF APPROPRIATIONS.

FACILITIES

Section 1431 of the National Agricultural Research, Extension,
and Teaching Policy Act Amendments of 1985 (Public Law 99–
198; 99 Stat. 1556) is amended by striking ‘‘2002’’ and inserting
‘‘2007’’.
SEC. 7138. CRITICAL AGRICULTURAL MATERIALS RESEARCH.

Section 16(a) of the Critical Agricultural Materials Act (7 U.S.C.
178n(a)) is amended by striking ‘‘2002’’ and inserting ‘‘2007’’.
SEC. 7139. AQUACULTURE.

Section 10 of the National Aquaculture Act of 1980 (16 U.S.C.
2809) is amended by striking ‘‘2002’’ each place it appears and
inserting ‘‘2007’’.

Subtitle B—Modifications
SEC. 7201. EQUITY IN EDUCATIONAL LAND-GRANT STATUS ACT OF
1994.

(a) AUTHORIZATION OF APPROPRIATIONS.—Section 534(a)(1)(A)
of the Equity in Educational Land-Grant Status Act of 1994 (7
U.S.C. 301 note) is amended by striking ‘‘$50,000’’ and inserting
‘‘$100,000’’.
(b) CHANGE OF INDIAN STUDENT COUNT FORMULA.—Section
533(c)(4)(A) of the Equity in Educational Land-Grant Status Act
of 1994 (7 U.S.C. 301 note; Public Law 103–382) is amended by
striking ‘‘(as defined in section 390(3) of the Carl D. Perkins Vocational and Applied Technology Education Act, as such section was
in effect on the day preceding the date of enactment of the Carl.
D. Perkins Vocational and Applied Technology Education Amendments of 1998 (Oct. 31, 1998)) for each 1994 Institution for the
fiscal year’’ and inserting ‘‘(as defined in section 2(a) of the Tribally
Controlled College or University Assistance Act of 1978 (25 U.S.C.
1801(a)))’’.
(c) ACCREDITATION REQUIREMENT FOR RESEARCH GRANTS.—Section 533(a)(3) of the Equity in Educational Land-Grant Status Act
of 1994 (7 U.S.C. 301 note; Public Law 103–382) is amended by

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PUBLIC LAW 107–171—MAY 13, 2002

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striking ‘‘sections 534 and 535’’ and inserting ‘‘sections 534, 535,
and 536’’.
(d) TECHNICAL AMENDMENT TO REFLECT NAME CHANGES.—
Section 532 of the Equity in Educational Land-Grant Status Act
of 1994 (7 U.S.C. 301 note; Public Law 103–382) is amended by
striking paragraphs (1) through (30) and inserting the following:
‘‘(1) Bay Mills Community College.
‘‘(2) Blackfeet Community College.
‘‘(3) Cankdeska Cikana Community College.
‘‘(4) College of Menominee Nation.
‘‘(5) Crownpoint Institute of Technology.
‘‘(6) D-Q University.
‘‘(7) Dine College.
‘‘(8) Chief Dull Knife Memorial College.
‘‘(9) Fond du Lac Tribal and Community College.
‘‘(10) Fort Belknap College.
‘‘(11) Fort Berthold Community College.
‘‘(12) Fort Peck Community College.
‘‘(13) Haskell Indian Nations University.
‘‘(14) Institute of American Indian and Alaska Native Culture and Arts Development.
‘‘(15) Lac Courte Oreilles Ojibwa Community College.
‘‘(16) Leech Lake Tribal College.
‘‘(17) Little Big Horn College.
‘‘(18) Little Priest Tribal College.
‘‘(19) Nebraska Indian Community College.
‘‘(20) Northwest Indian College.
‘‘(21) Oglala Lakota College.
‘‘(22) Salish Kootenai College.
‘‘(23) Sinte Gleska University.
‘‘(24) Sisseton Wahpeton Community College.
‘‘(25) Si Tanka/Huron University.
‘‘(26) Sitting Bull College.
‘‘(27) Southwestern Indian Polytechnic Institute.
‘‘(28) Stone Child College.
‘‘(29) Turtle Mountain Community College.
‘‘(30) United Tribes Technical College.
‘‘(31) White Earth Tribal and Community College.’’.
(e) REPORT RECOMMENDING CRITERIA FOR ADDITIONAL ELIGIBLE
ENTITIES.—Not later than 1 year after the date of enactment of
this Act, the Secretary of Agriculture shall submit a report containing recommended criteria for designating additional 1994
Institutions to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate.

7 USC 301 note.
Deadline.

SEC. 7202. CARRYOVER FOR EXPERIMENT STATIONS.

Section 7 of the Hatch Act of 1887 (7 U.S.C. 361g) is amended
by striking subsection (c) and inserting the following:
‘‘(c) CARRYOVER.—
‘‘(1) IN GENERAL.—The balance of any annual funds provided under this Act to a State agricultural experiment station
for a fiscal year that remains unexpended at the end of the
fiscal year may be carried over for use during the following
fiscal year.
‘‘(2) FAILURE TO EXPEND FULL ALLOTMENT.—

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(A) IN GENERAL.—If any unexpended balance carried
over by a State is not expended by the end of the second
fiscal year, an amount equal to the unexpended balance
shall be deducted from the next succeeding annual allotment to the State.
‘‘(B) REDISTRIBUTION.—Federal funds that are deducted
under subparagraph (A) for a fiscal year shall be redistributed by the Secretary in accordance with the formula set
forth in section 3(c) to those States for which no deduction
under subparagraph (A) has been taken for that fiscal
year.’’.

SEC. 7203. AUTHORIZATION PERCENTAGES FOR RESEARCH AND
EXTENSION FORMULA FUNDS.

Effective date.

Effective date.

(a) EXTENSION.—Section 1444(a) of the National Agricultural
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3221(a)) is amended—
(1) by striking ‘‘(a) There’’ and inserting the following:
‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) IN GENERAL.—There’’;
(2) by striking the second sentence; and
(3) in the third sentence, by striking ‘‘Beginning’’ through
‘‘6 per centum’’ and inserting the following:
‘‘(2) MINIMUM AMOUNT.—Beginning with fiscal year 2003,
there shall be appropriated under this section for each fiscal
year an amount that is not less than 15 percent’’;
(3) by striking ‘‘Funds appropriated’’ and inserting the following:
‘‘(3) USES.—Funds appropriated’’; and
(4) by striking ‘‘No more’’ and inserting the following:
‘‘(4) CARRYOVER.—No more’’.
(b) RESEARCH.—Section 1445(a) of the National Agricultural
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3222(a)) is amended—
(1) by striking ‘‘(a) There’’ and inserting the following:
‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) IN GENERAL.—There’’;
(2) by striking the second sentence and inserting the following:
‘‘(2) MINIMUM AMOUNT.—Beginning with fiscal year 2003,
there shall be appropriated under this section for each fiscal
year an amount that is not less than 25 percent of the total
appropriations for the fiscal year under section 3 of the Hatch
Act of 1887 (7 U.S.C. 361c).’’;
(3) by striking ‘‘Funds appropriated’’ and inserting the following:
‘‘(3) USES.—Funds appropriated’’;
(4) by striking ‘‘The eligible’’ and inserting the following:
‘‘(4) COORDINATION.—The eligible’’; and
(5) by striking ‘‘No more’’ and inserting the following:
‘‘(5) CARRYOVER.—No more’’.
SEC. 7204. CARRYOVER FOR ELIGIBLE INSTITUTIONS.

Section 1445(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222(a)) (as amended
by section 7203 of this Act) is further amended by striking paragraph (5) and inserting the following:
‘‘(5) CARRYOVER.—

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‘‘(A) IN GENERAL.—The balance of any annual funds
provided to an eligible institution for a fiscal year under
this section that remains unexpended at the end of the
fiscal year may be carried over for use during the following
fiscal year.
‘‘(B) FAILURE TO EXPEND FULL AMOUNT.—
‘‘(i) IN GENERAL.—If any unexpended balance carried over by an eligible institution is not expended
by the end of the second fiscal year, an amount equal
to the unexpended balance shall be deducted from the
next succeeding annual allotment to the eligible
institution.
‘‘(ii) REDISTRIBUTION.—Federal funds that are
deducted under clause (i) for a fiscal year shall be
redistributed by the Secretary in accordance with the
formula set forth in subsection (b)(2)(B) to those eligible
institutions for which no deduction under clause (i)
has been taken for that fiscal year.’’.
SEC. 7205. INITIATIVE FOR FUTURE AGRICULTURE AND FOOD SYSTEMS.

(a) FUNDING.—Section 401(b) of the Agricultural Research,
Extension, and Education Reform Act of 1998 (7 U.S.C. 7621(b))
is amended—
(1) in paragraph (1), by striking ‘‘2002’’ and inserting
‘‘2001’’; and
(2) by adding at the end the following:
‘‘(3) OTHER FUNDING.—Out of funds in the Commodity
Credit Corporation, the Secretary shall transfer to the
Account—
‘‘(A) on October 1, 2003, $120,000,000;
‘‘(B) on October 1, 2004, $140,000,000;
‘‘(C) on October 1, 2005, $160,000,000; and
‘‘(D) on October 1, 2006, and each October 1 thereafter,
$200,000,000.’’.
(2) by amending subsection (c)(1) to read as follows:
‘‘(1) CRITICAL EMERGING AGRICULTURAL AND RURAL
ISSUES.—The Secretary shall use the funds in the Account
for research, extension, and education grants (referred to in
this section as ‘grants’) to address critical emerging agricultural
and rural issues related to—
‘‘(A) future food production;
‘‘(B) environmental quality and natural resource
management;
‘‘(C) farm income; or
‘‘(D) rural economic and business and community
development policy.’’; and
(3) in subsection (e)(1), by striking ‘‘small and mid-sized’’
and inserting ‘‘small, mid-sized, and minority-serving’’.
SEC. 7206. ELIGIBILITY FOR INTEGRATED GRANTS PROGRAM.

Section 406(b) of the Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C. 7626(b)) is amended by
inserting ‘‘and 1994 Institutions’’ before ‘‘on a competitive basis’’.

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SEC. 7207. AGRICULTURAL RESEARCH, EXTENSION, AND EDUCATION
REFORM ACT OF 1998.

(a) PRECISION AGRICULTURE.—Section 403 of the Agricultural
Research, Extension, and Education Reform Act of 1998 (7 U.S.C.
7623) is amended—
(1) in subsection (a)—
(A) in paragraph (3)—
(i) in subparagraph (A), inserting ‘‘, horticultural,’’
following ‘‘agronomic’’ the second place it appears; and
(ii) in subparagraph (C), by striking ‘‘or’’ at the
end;
(iii) in subparagraph (D), by striking the period
at the end and inserting ‘‘; or’’; and
(iv) by adding at the end the following:
‘‘(E) using such information to enable intelligent
mechanized harvesting and sorting systems for horticultural crops.’’;
(B) in paragraph (4)—
(i) in subparagraph (C), by striking ‘‘or’’ at the
end;
(ii) in subparagraph (D), by striking the period
at the end and inserting ‘‘; or’’; and
(iii) by adding at the end the following:
‘‘(E) robotic and other intelligent machines for use in
horticultural cropping systems.’’; and
(C) in paragraph (5)(F), by inserting ‘‘(including
improved use of energy inputs)’’ after ‘‘farm production
efficiencies’’;
(2) in subsection (c)(2)—
(A) by inserting ‘‘or horticultural’’ after ‘‘agronomic’’;
and
(B) by striking ‘‘and meteorological variability’’ and
inserting ‘‘product variability, and meteorological variability’’;
(3) in subsection (d)—
(A) by redesignating paragraphs (4) and (5) as paragraphs (5) and (6), respectively; and
(B) by inserting after paragraph (3) the following:
‘‘(4) Improve farm energy use efficiencies.’’.
(b) THOMAS JEFFERSON INITIATIVE FOR CROP DIVERSIFICATION.—Section 405(a) of the Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C. 7625(a)) is amended by
striking ‘‘and marketing’’ and inserting ‘‘, marketing, and efficient
use’’.
(c) COORDINATED PROGRAM OF RESEARCH, EXTENSION, AND EDUCATION TO IMPROVE VIABILITY OF SMALL- AND MEDIUM-SIZE DAIRY,
LIVESTOCK, AND POULTRY OPERATIONS.—Section 407(b)(3) of the
Agricultural Research, Extension, and Education Reform Act of
1998 (7 U.S.C. 7627(b)(3)) is amended by inserting ‘‘(including
improved use of energy inputs)’’ after ‘‘poultry systems that increase
efficiencies’’.
(d) SUPPORT FOR RESEARCH REGARDING DISEASES OF WHEAT,
TRITICALE, AND BARLEY CAUSED BY FUSARIUM GRAMINEARUM OR
BY TILLETIA INDICA.—
(1) RESEARCH GRANT AUTHORIZED.—Section 408(a) of the
Agricultural Research, Extension, and Education Reform Act
of 1998 (7 U.S.C. 7628(a)) is amended to read as follows:

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‘‘(a) RESEARCH GRANT AUTHORIZED.—The Secretary of Agriculture may make grants to consortia of land-grant colleges and
universities to enhance the ability of the consortia to carry out
multi-State research projects aimed at understanding and combating diseases of wheat, triticale, and barley caused by Fusarium
graminearum and related fungi (referred to in this section as ‘wheat
scab’) or by Tilletia indica and related fungi (referred to in this
section as ‘Karnal bunt’).’’.
(2) RESEARCH COMPONENTS.—Section 408(b) of such Act
(7 U.S.C. 7628(b)) is amended—
(A) in paragraph (1), by inserting ‘‘or of Karnal bunt,’’
after ‘‘epidemiology of wheat scab’’;
(B) in paragraph (1), by inserting ‘‘, triticale,’’ after
‘‘occurring in wheat’’;
(C) in paragraph (2), by inserting ‘‘or Karnal bunt’’
after ‘‘wheat scab’’;
(D) in paragraph (3)(A), by striking ‘‘and barley for
the presence of’’ and inserting ‘‘, triticale, and barley for
the presence of Karnal bunt or of’’;
(E) in paragraph (3)(B), by striking ‘‘and barley infected
with wheat scab’’ and inserting ‘‘, triticale, and barley
infected with wheat scab or with Karnal bunt’’;
(F) in paragraph (3)(C), by inserting ‘‘wheat scab’’ after
‘‘to render’’;
(G) in paragraph (4), by striking ‘‘and barley to wheat
scab’’ and inserting ‘‘, triticale, and barley to wheat scab
and to Karnal bunt’’; and
(H) in paragraph (5)—
(i) by inserting ‘‘and Karnal bunt’’ after ‘‘wheat
scab’’; and
(ii) by inserting ‘‘, triticale,’’ after ‘‘resistant
wheat’’.
(3) COMMUNICATIONS NETWORKS.—Section 408(c) of such
Act (7 U.S.C. 7628(c)) is amended by inserting ‘‘or Karnal
bunt’’ after ‘‘wheat scab’’.
(4) TECHNICAL AMENDMENTS.—(A) The section heading for
section 408 of such Act is amended by striking ‘‘AND BARLEY
CAUSED BY FUSARIUM GRAMINEARUM’’ and inserting ‘‘,
TRITICALE, AND BARLEY CAUSED BY FUSARIUM GRAMINEARUM
OR BY TILLETIA INDICA’’.
(B) The table of sections for such Act is amended by striking
‘‘and barley caused by fusarium graminearum’’ in the item
relating to section 408 and inserting ‘‘, triticale, and barley
caused by Fusarium graminearum or by Tilletia indica’’.
(e) PROGRAM TO CONTROL JOHNE’S DISEASE.—Title IV of the
Agricultural Research, Extension, and Education Reform Act of
1998 (7 U.S.C. 7621 et seq.) is amended by adding at the end
the following new section:
‘‘SEC. 409. BOVINE JOHNE’S DISEASE CONTROL PROGRAM.

7 USC 7629.

‘‘(a) ESTABLISHMENT.—The Secretary of Agriculture, in
coordination with State veterinarians and other appropriate State
animal health professionals, may establish a program to conduct
research, testing, and evaluation of programs for the control and
management of Johne’s disease in livestock.
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to the Secretary such sums as may be necessary

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to carry out this section for each of fiscal years 2003 through
2007.’’.
SEC. 7208. FOOD, AGRICULTURE, CONSERVATION, AND TRADE ACT OF
1990.

(a) AGRICULTURAL GENOME INITIATIVE.—Section 1671(b) of the
Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C.
5924(b)) is amended—
(1) in paragraph (3), by inserting ‘‘pathogens and’’ before
‘‘diseases causing economic hardship’’;
(2) in paragraph (6), by striking ‘‘and’’ at the end;
(3) by redesignating paragraph (7) as paragraph (8); and
(4) by inserting after paragraph (6) the following new paragraph:
‘‘(7) reducing the economic impact of plant pathogens on
commercially important crop plants; and’’.
(b) HIGH-PRIORITY RESEARCH AND EXTENSION INITIATIVES.—
Section 1672(e) of the Food, Agriculture, Conservation, and Trade
Act of 1990 (7 U.S.C. 5925) is amended by adding at the end
the following new paragraphs:
‘‘(25) GENETICALLY MODIFIED AGRICULTURE PRODUCTS
(GMAP) RESEARCH.—Research grants may be made under this
section for the purposes of providing unbiased, science-based
evaluation of the risks and benefits to the public and the
environment of specific genetically modified plant and animal
products. Grants may be used to form interdisciplinary teams
to review and conduct research on scientific, social, economic,
and ethical issues during the review process, to answer questions raised by the release of new genetically modified agriculture products, to conduct fundamental studies on the health
and environmental safety of genetically modified agriculture
products (including quantitative risk assessment, the effect of
specific genetically modified agriculture products on human
health, and gene flow studies), to communicate the risk of
genetically modified agriculture products through extension and
education programs, and to engage the public and industry
in relevant issues.
‘‘(26) WIND EROSION RESEARCH AND EXTENSION.—Research
and extension grants may be made under this section for the
purpose of validating wind erosion models.
‘‘(27) CROP LOSS RESEARCH AND EXTENSION.—Research and
extension grants may be made under this section for the purpose of validating crop loss models.
‘‘(28) LAND USE MANAGEMENT RESEARCH AND EXTENSION.—
Research and extension grants may be made under this section
for the purposes of evaluating the environmental benefits of
land use management tools such as those provided in the
Farmland Protection Program.
‘‘(29) WATER AND AIR QUALITY RESEARCH AND EXTENSION.—
Research and extension grants may be made under this section
for the purpose of better understanding agricultural impacts
to air and water quality and means to address them.
‘‘(30) REVENUE AND INSURANCE TOOLS RESEARCH AND
EXTENSION.—Research and extension grants may be made
under this section for the purposes of better understanding
the impact of revenue and insurance tools on farm income.

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‘‘(31) AGROTOURISM RESEARCH AND EXTENSION.—Research
and extension grants may be made under this section for the
purpose of better understanding the economic, environmental,
and food systems impacts of agrotourism.
‘‘(32) HARVESTING PRODUCTIVITY FOR FRUITS AND VEGETABLES.—Research and extension grants may be made under this
section for the purpose of improving harvesting productivity
for fruits and vegetables (including citrus), including the
development of mechanical harvesting technologies and effective, economical, and safe abscission compounds.
‘‘(33) NITROGEN-FIXATION BY PLANTS.—Research and extension grants may be made under this section for the purpose
of enhancing the nitrogen-fixing ability and efficiency of legumes, developing new varieties of legumes that fix nitrogen
more efficiently, and developing new varieties of other commercially important crops that potentially are able to fix nitrogen.
‘‘(34) AGRICULTURAL MARKETING.—Extension grants may
be made under this section for the purpose of providing education materials, information, and outreach programs regarding
commodity and livestock marketing strategies for agricultural
producers and for cooperatives and other marketers of any
agricultural commodity, including livestock.
‘‘(35) ENVIRONMENT AND PRIVATE LANDS RESEARCH AND
EXTENSION.—Research and extension grants may be made
under this section for the purpose of researching the use of
computer models to aid in assessment of best management
practices on a watershed basis, working with government,
industry, and private landowners to help craft industry-led
solutions to identified environmental issues, researching and
monitoring water, air, or soil environmental quality to aid
in the development of new approaches to local environmental
concerns, and working with local, State, and federal officials
to help craft effective environmental solutions that respect private property rights and agricultural production realities.
‘‘(36) LIVESTOCK DISEASE RESEARCH AND EXTENSION.—
Research and extension grants may be made under this section
for the purpose of identifying possible livestock disease threats,
educating the public regarding livestock disease threats,
training persons to deal with such threats, and conducting
related research.
‘‘(37) PLANT GENE EXPRESSION.—Research grants may be
made under this section for the purpose of plant gene expression
research to accelerate the application of basic plant genomic
science to the development and testing of new varieties of
enhanced food crops, crops that can be used as renewable
energy sources, and other alternative uses of agricultural crops.
‘‘(38) ANIMAL INFECTIOUS DISEASES RESEARCH.—Research
and extension grants may be made under this section for the
purpose of developing prevention and control methodologies
for animal infectious diseases (including evaluation under field
conditions in countries in which an animal disease occurs)
such as laboratory tests for quicker detection of infected animals
and presence of disease, prevention strategies (including vaccination programs), and rapid diagnostic techniques for animal
disease agents considered to be risks for agricultural bioterrorism attack.

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‘‘(39) PROGRAM TO COMBAT CHILDHOOD OBESITY.—Research
and extension grants may be made under this section to institutions of higher education with demonstrated capacity in basic
and clinical obesity research, nutrition research, and community health education research to develop and evaluate community-wide strategies that catalyze partnerships between families
and health care, education, recreation, mass media, and other
community resources to reduce the incidence of childhood obesity.
‘‘(40) INTEGRATED PEST MANAGEMENT.—Research and extension grants may be made under this section to coordinate
and improve research, education, and outreach on, and
implementation on farms of, integrated pest management.
‘‘(41) BEEF CATTLE GENETICS.—Research and extension
grants for beef cattle genetics evaluation research may be made
under this section to consortia of institutions of higher education that have expertise in beef cattle genetic evaluation
research and technology and that have been actively involved
for at least 20 years in the estimation and prediction of progeny
differences for publication and use by seed stock producer breed
associations.
‘‘(42) DAIRY PIPELINE CLEANER.—Research and extension
grants may be made under this section for the purpose of
preventing and eliminating the dangers of dairy pipeline
cleaner, including development of safer packaging and transfer
mechanisms, outlining accident causes and potential prevention
measures, and other means of improving efforts to prevent
ingestion of dairy pipeline cleaner.
‘‘(43) DEVELOPMENT OF PUBLICLY HELD PLANTS AND ANIMAL
VARIETIES.—Research and extension grants may be made under
this section for the purpose of development of publicly held
plants and animal varieties (including germplasm for identitypreserved markets) and genetic resource conservation activities.
‘‘(44) SUGARCANE GENETICS.—Research grants may be made
under this section for the purpose of maintaining acceptable
yields under reduced production inputs, implementing markerassisted breeding strategies and other basic plant genomic technologies to screen for improved plant resistance to diseases,
weeds, and insects toward minimizing pesticide use, enhancing
food, fiber and energy production, and developing varieties for
maximum performance under prevailing conditions, including
management for improved soil and water conservation.’’.
(c) ASSISTIVE TECHNOLOGY PROGRAM FOR FARMERS WITH
DISABILITIES.—Section 1680(a) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5933(a)) is amended by
adding at the end the following new paragraph:
‘‘(6) CONSIDERATION FOR GRANTS FOR NEW PROGRAMS.—
For each fiscal year that amounts are made available for grants
under this subsection, the Secretary may make grants in a
manner that ensures that eligible entities who apply for grants,
but have not previously received a grant under this subsection,
are given full consideration.’’.
SEC. 7209. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, AND
TEACHING POLICY ACT OF 1977.

(a) NATIONAL AGRICULTURAL
CATION, AND ECONOMIC ADVISORY

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National Agricultural Research, Extension, and Teaching Policy
Act of 1977 (7 U.S.C. 3123) is amended—
(1) in subsection (b)(1), by striking ‘‘30 members’’ and
inserting ‘‘31 members’’;
(2) in subsection (b)(3)—
(A) by redesignating subparagraphs (R) through (DD)
as subparagraphs (S) through (EE), respectively; and
(B) by inserting after subparagraph (Q) the following
new subparagraph:
‘‘(R) 1 member representing a non-land grant college
or university with a historic commitment to research in
the food and agricultural sciences.’’;
(3) in subsection (c)(1), by striking ‘‘and land-grant colleges
and universities’’ and inserting ‘‘, land-grant colleges and
universities, and the Committee on Agriculture of the House
of Representatives, the Committee on Agriculture, Nutrition,
and Forestry of the Senate, the Subcommittee on Agriculture,
Rural Development, Food and Drug Administration and Related
Agencies of the Committee on Appropriations of the House
of Representatives, and the Subcommittee on Agriculture, Rural
Development and Related Agencies of the Committee on Appropriations of the Senate’’; and
(4) in subsection (d)(1), inserting ‘‘consult with any appropriate agencies of the Department of Agriculture and’’ after
‘‘the Advisory Board shall’’.
(b) GRANTS FOR RESEARCH ON PRODUCTION AND MARKETING
OF ALCOHOLS AND INDUSTRIAL HYDROCARBONS FROM AGRICULTURAL
COMMODITIES AND FOREST PRODUCTS.—Section 1419 of the National
Agricultural Research, Extension, and Teaching Policy Act of 1977
(7 U.S.C. 3154) is amended—
(1) in subsection (a)(2), by inserting ‘‘and animal fats and
oils’’ after ‘‘industrial oilseed crops’’; and
(2) in subsection (a)(4), by inserting ‘‘or triglycerides’’ after
‘‘other industrial hydrocarbons’’.
(c) FAS OVERSEAS INTERN PROGRAM.—Section 1458(a) of the
National Agricultural Research, Extension, and Teaching Policy
Act of 1977 (7 U.S.C. 3291(a)) is amended—
(1) by striking ‘‘and’’ at the end of paragraph (8);
(2) by striking the period at the end of paragraph (9)
and inserting ‘‘; and’’; and
(3) by adding at the end the following new paragraph:
‘‘(10) establish a program, to be coordinated by the Cooperative State Research, Education, and Extension Service and
the Foreign Agricultural Service, to place interns from United
States colleges and universities at Foreign Agricultural Service
field offices overseas.’’.
(d) RANGELAND RESEARCH GRANTS.—Section 1480 of the
National Agricultural Research, Extension, and Teaching Policy
Act of 1977 (7 U.S.C. 3333) is amended to read as follows:
‘‘SEC. 1480. RANGELAND RESEARCH GRANTS.

‘‘(a) IN GENERAL.—The Secretary may make grants to—
‘‘(1) land-grant colleges and universities, State agricultural
experiment stations, and colleges, universities, and Federal
laboratories having a demonstrable capacity in rangeland
research, as determined by the Secretary, to carry out rangeland research; and

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘(2) the Joe Skeen Institute for Rangeland Restoration
for the purposes of facilitating and expanding ongoing StateFederal range management, animal husbandry, and agricultural research, education, and extension programs to meet the
targeted, emerging, and future needs of western United States
rangelands and associated natural resources.
‘‘(b) MATCHING REQUIREMENTS.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
this grant program shall be based on a matching formula
of 50 percent Federal and 50 percent non-Federal funding.
‘‘(2) EXCEPTION.—Paragraph (1) shall not apply to a grant
to a Federal laboratory or a grant under subsection (a)(2).’’.

SEC. 7210. BIOTECHNOLOGY RISK ASSESSMENT RESEARCH.

Section 1668 of the Food, Agriculture, Conservation, and Trade
Act of 1990 (7 U.S.C. 5921) is amended to read as follows:
‘‘SEC. 1668. BIOTECHNOLOGY RISK ASSESSMENT RESEARCH.

‘‘(a) PURPOSE.—It is the purpose of this section—
‘‘(1) to authorize and support environmental assessment
research to help identify and analyze environmental effects
of biotechnology; and
‘‘(2) to authorize research to help regulators develop longterm policies concerning the introduction of such technology.
‘‘(b) GRANT PROGRAM.—The Secretary of Agriculture shall establish a grant program within the Cooperative State Research, Education, and Extension Service and the Agricultural Research Service
to provide the necessary funding for environmental assessment
research concerning the introduction of genetically engineered animals, plants, and microorganisms into the environment.
‘‘(c) RESEARCH PRIORITIES.— The following types of research
shall be given priority for funding:
‘‘(1) Research designed to identify and develop appropriate
management practices to minimize physical and biological risks
associated with genetically engineered animals, plants, and
microorganisms.
‘‘(2) Research designed to develop methods to monitor the
dispersal of genetically engineered animals, plants, and microorganisms.
‘‘(3) Research designed to further existing knowledge with
respect to the characteristics, rates, and methods of gene
transfer that may occur between genetically engineered animals, plants, and microorganisms and related wild and agricultural organisms.
‘‘(4) Environmental assessment research designed to provide analysis which compares the relative impacts of animals,
plants, and microorganisms modified through genetic
engineering to other types of production systems.
‘‘(5) Other areas of research designed to further the purposes of this section.
‘‘(d) ELIGIBILITY REQUIREMENTS.—Grants under this section
shall be—
‘‘(1) made on the basis of the quality of the proposed
research project; and
‘‘(2) available to any public or private research or educational institution or organization.
‘‘(e) CONSULTATION.— In considering specific areas of research
for funding under this section, the Secretary of Agriculture shall

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consult with the Administrator of the Animal and Plant Health
Inspection Service and the National Agricultural Research, Extension, Education, and Economics Advisory Board.
‘‘(f) PROGRAM COORDINATION.— The Secretary of Agriculture
shall coordinate research funded under this section with the Office
of Research and Development of the Environmental Protection
Agency in order to avoid duplication of research activities.
‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) IN GENERAL.— There are authorized to be appropriated
such sums as necessary to carry out this section.
‘‘(2) WITHHOLDINGS FROM BIOTECHNOLOGY OUTLAYS.—The
Secretary of Agriculture shall withhold from outlays of the
Department of Agriculture for research on biotechnology, as
defined and determined by the Secretary, at least 2 percent
of such amount for the purpose of making grants under this
section for research on biotechnology risk assessment.
‘‘(3) APPLICATION OF FUNDS.—Funds made available under
this subsection shall be applied, to the maximum extent practicable, to risk assessment research on all categories identified
in subsection (c).’’.
SEC.

7211.

COMPETITIVE,
GRANTS.

SPECIAL,

AND

FACILITIES

RESEARCH

Section 2(b)(2) of the Competitive, Special, and Facilities
Research Grant Act (7 U.S.C. 450i(b)(2)) is amended by striking
‘‘in—’’ and inserting the following: ‘‘in the areas described in subparagraphs (A) through (F). Such needs shall be determined by
the Secretary, in consultation with the National Agricultural
Research, Extension, Education, and Economics Advisory Board,
not later than July 1 of each fiscal year for the purposes of the
following fiscal year.’’.

Deadline.

SEC. 7212. MATCHING FUNDS REQUIREMENT FOR RESEARCH AND
EXTENSION ACTIVITIES OF 1890 INSTITUTIONS.

Section 1449 of the National Agricultural Research, Extension,
and Teaching Policy Act of 1977 (7 U.S.C. 3222d) is amended—
(1) by amending subsection (c) to read as follows:
‘‘(c) MATCHING FORMULA.—Notwithstanding any other provision
of this subtitle, for each of fiscal years 2003 through 2007, the
State shall provide matching funds from non-Federal sources. Such
matching funds shall be for an amount equal to not less than—
‘‘(1) 60 percent of the formula funds to be distributed to
the eligible institution for fiscal year 2003;
‘‘(2) 70 percent of the formula funds to be distributed to
the eligible institution for fiscal year 2004;
‘‘(3) 80 percent of the formula funds to be distributed to
the eligible institution for fiscal year 2005;
‘‘(4) 90 percent of the formula funds to be distributed to
the eligible institution for fiscal year 2006; and
‘‘(5) 100 percent of the formula funds to be distributed
to the eligible institution for fiscal year 2007 and each fiscal
year thereafter.’’; and
(2) by amending subsection (d) to read as follows:
‘‘(d) WAIVER AUTHORITY.—Notwithstanding subsection (f), the
Secretary may waive the matching funds requirement under subsection (c) above the 50 percent level for any fiscal year for an
eligible institution of a State if the Secretary determines that the
State will be unlikely to satisfy the matching requirement.’’.

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SEC. 7213. MATCHING REQUIREMENTS FOR RESEARCH AND EXTENSION FORMULA FUNDS FOR INSULAR AREA LAND-GRANT
INSTITUTIONS.

Effective date.

Effective date.

(a) EXPERIMENT STATIONS.—Section 3(d) of the Hatch Act of
1887 (7 U.S.C. 361c(d)) is amended by striking paragraph (4) and
inserting the following:
‘‘(4) EXCEPTION FOR INSULAR AREAS.—
‘‘(A) IN GENERAL.—Effective beginning for fiscal year
2003, in lieu of the matching funds requirement of paragraph (1), the insular areas of the Commonwealth of Puerto
Rico, Guam, and the Virgin Islands of the United States
shall provide matching funds from non-Federal sources
in an amount equal to not less than 50 percent of the
formula funds distributed by the Secretary to each of the
insular areas, respectively, under this section.
‘‘(B) WAIVERS.—The Secretary may waive the matching
fund requirement of subparagraph (A) for any fiscal year
if the Secretary determines that the government of the
insular area will be unlikely to meet the matching requirement for the fiscal year.’’.
(b) COOPERATIVE AGRICULTURAL EXTENSION.—Section 3(e) of
the Smith-Lever Act (7 U.S.C. 343(e)) is amended by striking paragraph (4) and inserting the following:
‘‘(4) EXCEPTION FOR INSULAR AREAS.—
‘‘(A) IN GENERAL.—Effective beginning for fiscal year
2003, in lieu of the matching funds requirement of paragraph (1), the insular areas of the Commonwealth of Puerto
Rico, Guam, and the Virgin Islands of the United States
shall provide matching funds from non-Federal sources
in an amount equal to not less than 50 percent of the
formula funds distributed by the Secretary to each of the
insular areas, respectively, under this section.
‘‘(B) WAIVERS.—The Secretary may waive the matching
fund requirement of subparagraph (A) for any fiscal year
if the Secretary determines that the government of the
insular area will be unlikely to meet the matching requirement for the fiscal year.’’.
SEC. 7214. DEFINITION OF FOOD AND AGRICULTURAL SCIENCES.

Section 2(3) of the Research Facilities Act (7 U.S.C. 390(2)(3))
is amended to read as follows:
‘‘(3) FOOD AND AGRICULTURAL SCIENCES.—The term ‘food
and agricultural sciences’ has the meaning given that term
in section 1404(8) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103(8)).’’.
SEC. 7215. FEDERAL EXTENSION SERVICE.

Section 3(b)(3) of the Smith-Lever Act (7 U.S.C. 343(b)(3)) is
amended—
(1) by striking ‘‘$5,000,000’’ and inserting ‘‘such sums as
are necessary’’; and
(2) by adding after the first sentence the following new
sentence: ‘‘The balance of any annual funds provided under
the preceding sentence for a fiscal year that remains unexpended at the end of that fiscal year shall remain available
without fiscal year limitation.’’.

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SEC. 7216. POLICY RESEARCH CENTERS.

Section 1419A(c)(3) of the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3155(c)(3))
is amended by striking ‘‘collect and analyze’’ and inserting ‘‘collect,
analyze, and disseminate’’.
SEC. 7217. AVAILABILITY OF COMPETITIVE GRANT FUNDS.

The National Agricultural Research, Extension, and Teaching
Policy Act of 1977 is amended by inserting after section 1469
(7 U.S.C. 3315) the following:
‘‘SEC. 1469A. AVAILABILITY OF COMPETITIVE GRANT FUNDS.

7 USC 3315a.

‘‘Except as otherwise provided by law, funds made available
to the Secretary to carry out a competitive agricultural research,
education, or extension grant program under this or any other
Act shall be available for obligation for a 2-year period beginning
on October 1 of the fiscal year for which the funds are made
available.’’.
SEC. 7218. ORGANIC AGRICULTURE RESEARCH AND EXTENSION INITIATIVE.

Section 1672B of the Food, Agriculture, Conservation, and
Trade Act of 1990 (7 U.S.C. 5925b) is amended—
(1) in subsection (a)—
(A) in paragraph (1), by inserting ‘‘, breeding,’’ after
‘‘production’’;
(B) in paragraph (2), by striking ‘‘and’’ at the end;
(C) in paragraph (3), by striking the period at the
end and inserting a semicolon; and
(D) by adding at the end the following:
‘‘(4) determining desirable traits for organic commodities;
‘‘(5) identifying marketing and policy constraints on the
expansion of organic agriculture; and
‘‘(6) conducting advanced on-farm research and development that emphasizes observation of, experimentation with,
and innovation for working organic farms, including research
relating to production and marketing and to socioeconomic
conditions.’’; and
(2) by amending subsection (e) to read as follows:
‘‘(e) FUNDING.—On October 1, 2003, and each October 1 thereafter through October 1, 2007, out of any funds in the Treasury
not otherwise appropriated, the Secretary of the Treasury shall
transfer $3,000,000 to the Secretary of Agriculture for this section.’’.

Effective date.

SEC. 7219. SENIOR SCIENTIFIC RESEARCH SERVICE.

Subtitle B of title VI of the Agricultural Research, Extension,
and Education Reform Act of 1998 (7 U.S.C. 7651 et seq.) is
amended by adding at the end the following:
‘‘SEC. 620. SENIOR SCIENTIFIC RESEARCH SERVICE.

‘‘(a) IN GENERAL.—There is established in the Department of
Agriculture the Senior Scientific Research Service (referred to in
this section as the ‘Service’).
‘‘(b) MEMBERS.—
‘‘(1) IN GENERAL.—Subject to paragraphs (2) through (4),
the Secretary shall appoint the members of the Service.
‘‘(2) QUALIFICATIONS.—To be eligible for appointment to
the Service, an individual shall—

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Establishment.
7 USC 7657.

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‘‘(A) have conducted outstanding research in the field
of agriculture or forestry;
‘‘(B) have earned a doctoral level degree at an institution of higher education (as defined in section 101 of the
Higher Education Act of 1965 (20 U.S.C. 1001)); and
‘‘(C) meet qualification standards prescribed by the
Director of the Office of Personnel Management for appointment to a position at level GS–15 of the General Schedule.
‘‘(3) NUMBER.—Not more than 100 individuals may serve
as members of the Service at any 1 time.
‘‘(4) OTHER REQUIREMENTS.—
‘‘(A) IN GENERAL.—Subject to subparagraph (B) and
subsection (d)(2), the Secretary may appoint and employ
a member of the Service without regard to—
‘‘(i) the provisions of title 5, United States Code,
governing appointments in the competitive service;
‘‘(ii) the provisions of subchapter I of chapter 35
of title 5, United States Code, relating to retention
preference;
‘‘(iii) the provisions of chapter 43 of title 5, United
States Code, relating to performance appraisal and
performance actions;
‘‘(iv) the provisions of chapter 51 and subchapter
III of chapter 53 of title 5, United States Code, relating
to classification and General Schedule pay rates; and
‘‘(v) the provisions of chapter 75 of title 5, United
States Code, relating to adverse actions.
‘‘(B) EXCEPTION.—A member of the Service appointed
and employed by the Secretary under subparagraph (A)
shall have the same right of appeal to the Merit Systems
Protection Board and the same right to file a complaint
with the Office of Special Counsel as an employee appointed
to a position at level GS–15 of the General Schedule.
‘‘(c) PERFORMANCE APPRAISAL SYSTEM.—The Secretary shall
develop a performance appraisal system for members of the Service
that is designed to—
‘‘(1) provide for the systematic appraisal of the employment
performance of the members; and
‘‘(2) encourage excellence in employment performance by
the members.
‘‘(d) COMPENSATION.—
‘‘(1) IN GENERAL.—Subject to paragraph (2), the Secretary
shall determine the compensation of members of the Service.
‘‘(2) LIMITATIONS.—The rate of pay for a member of the
Service shall—
‘‘(A) not be less than the minimum rate payable for
a position at level GS–15 of the General Schedule; and
‘‘(B) not be more than the rate payable for a position
at level I of the Executive Schedule, unless the rate is
approved by the President under section 5377(d)(2) of title
5, United States Code.
‘‘(e) RETIREMENT CONTRIBUTIONS.—
‘‘(1) IN GENERAL.—On the request of a member of the
Service who was an employee of an institution of higher education (as defined in section 101 of the Higher Education Act
of 1965 (20 U.S.C. 1001)) immediately prior to appointment
as a member of the Service and who retains the right to

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continue to make contributions to the retirement system of
the institution, the Secretary may contribute an amount not
to exceed 10 percent of the basic pay of the member to the
retirement system of the institution on behalf of the member.
‘‘(2) FEDERAL RETIREMENT SYSTEM.—
‘‘(A) IN GENERAL.—Subject to subparagraph (B), a
member for whom a contribution is made under paragraph
(1) shall not, as a result of serving as a member of the
Service, be covered by, or earn service credit under, chapter
83 or 84 of title 5, United States Code.
‘‘(B) ANNUAL LEAVE.—Service of a member of the
Service described in subparagraph (A) shall be creditable
for determining years of service under section 6303(a) of
title 5, United States Code.
‘‘(f) INVOLUNTARY SEPARATION.—
‘‘(1) IN GENERAL.—Subject to paragraph (2) and notwithstanding the provisions of title 5, United States Code, governing
appointment in the competitive service, in the case of an individual who is separated from the Service involuntarily and
without cause—
‘‘(A) the Secretary may appoint the individual to a
position in the competitive civil service at level GS–15
of the General Schedule; and
‘‘(B) the appointment shall be a career appointment.
‘‘(2) EXCEPTED CIVIL SERVICE.—In the case of an individual
described in paragraph (1) who immediately prior to appointment as a member of the Service was not a career appointee
in the civil service or the Senior Executive Service, the appointment of the individual under paragraph (1)—
‘‘(A) shall be to the excepted civil service; and
‘‘(B) may not exceed a period of 2 years.’’.
SEC. 7220. TERMINATION OF CERTAIN SCHEDULE A APPOINTMENTS.

(a) TERMINATION.—Not later than January 31, 2003, the Secretary of Agriculture shall terminate each appointment listed as
an excepted position under schedule A of the General Schedule
made by the Secretary to the Federal civil service of an individual
who holds dual government appointments, and who carries out
agricultural extension work in a program at a college or university
eligible to receive funds, under—
(1) the Smith-Lever Act (7 U.S.C. 341 et seq.);
(2) section 1444 of the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3221);
or
(3) section 208(e) of the District of Columbia Public Postsecondary Education Reorganization Act (88 Stat. 1428).
(b) CONTINUATION OF CERTAIN FEDERAL BENEFITS.—
(1) IN GENERAL.—Notwithstanding title 5, United States
Code, and subject to paragraph (2), an individual described
in subsection (a), during the period the individual is employed
in an agricultural extension program described in subsection
(a) without a break in service, shall continue to—
(A) be eligible to participate, to the same extent that
the individual was eligible to participate (on the day before
the date of enactment of this Act), in—
(i) the Federal Employee Health Benefits Program;

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PUBLIC LAW 107–171—MAY 13, 2002
(ii) the Federal Employee Group Life Insurance
Program;
(iii) the Civil Service Retirement System;
(iv) the Federal Employee Retirement System;
(v) the Thrift Savings Plan; and
(vi) the Federal Long Term Care Insurance Program; and
(B) receive Federal Civil Service employment credit
to the same extent that the individual was receiving such
credit on the day before the date of enactment of this
Act.
(2) LIMITATIONS.—An individual may continue to be eligible
for the benefits described in paragraph (1) if—
(A) in the case of an individual who remains employed
in the agricultural extension program described in subsection (a) on the date of enactment of this Act, the
employing college or university continues to fulfill the
administrative and financial responsibilities (including
making agency contributions) associated with providing
those benefits, as determined by the Secretary of Agriculture; and
(B) in the case of an individual who changes employment to a second college or university described in subsection (a)—
(i) the individual continues to work in an agricultural extension program described in subsection (a),
as determined by the Secretary of Agriculture;
(ii) the second college or university—
(I) fulfills the administrative and financial
responsibilities (including making agency contributions) associated with providing those benefits, as
determined by the Secretary of Agriculture; and
(II) within 1 year before the date of the
employment of the individual, had employed a different individual described in subsection (a) who
had performed the same duties of employment;
and
(iii) the individual was eligible for those benefits
on the day before the date of enactment of this Act.

SEC. 7221. BIOSECURITY PLANNING AND RESPONSE PROGRAMS.

(a) BIOSECURITY.—The National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3101 et seq.)
is amended by adding at the end the following:

‘‘Subtitle N—Biosecurity
7 USC 3351.

‘‘SEC. 1484. SPECIAL AUTHORIZATION FOR BIOSECURITY PLANNING
AND RESPONSE.

‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—In addition to
amounts for agricultural research, extension, and education under
this Act, there are authorized to be appropriated for agricultural
research, education, and extension activities for biosecurity planning and response such sums as are necessary for each of fiscal
years 2002 through 2007.
‘‘(b) USE OF FUNDS.—Using any authority available to the Secretary, the Secretary shall use funds made available under this

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section to carry out agricultural research, education, and extension
activities (including through competitive grants) for the following:
‘‘(1) To reduce the vulnerability of the United States food
and agricultural system to chemical or biological attack.
‘‘(2) To continue partnerships with institutions of higher
education and other institutions to help form stable, long-term
programs to enhance the biosecurity of the United States,
including the coordination of the development, implementation,
and enhancement of diverse capabilities for addressing threats
to the Nation’s agricultural economy and food supply with
special emphasis on planning, training, outreach, and research
activities related to vulnerability analyses, incident response,
and detection and prevention technologies.
‘‘(3) To make competitive grants to universities and qualified research institutions for research on counterbioterrorism.
‘‘(4) To counter or otherwise respond to chemical or
biological attack.
‘‘SEC. 1485. AGRICULTURE RESEARCH FACILITY EXPANSION AND SECURITY UPGRADES.

Grants.
7 USC 3352.

‘‘(a) IN GENERAL.—To enhance the security of agriculture in
the United States against threats posed by bioterrorism, the Secretary shall make expansion or security upgrade grants on a
competitive basis to colleges and universities (as defined in section
1404(4)).
‘‘(b) LIMITATION ON GRANTS.—Grants to a recipient under this
section shall not exceed $10,000,000 in any fiscal year.
‘‘(c) REQUIREMENTS FOR GRANTS.—The Secretary shall make
a grant under this section only if the grant applicant provides
satisfactory assurances to the Secretary that—
‘‘(1) sufficient funds are available to pay the non-Federal
share of the cost of the proposed expansion or security upgrades;
and
‘‘(2) the proposed expansion or security upgrades meet such
reasonable qualifications as may be established by the Secretary with respect to biosafety and biosecurity requirements
necessary to protect facility staff, members of the public, and
the food supply.
‘‘(d) ADDITIONAL REQUIREMENTS FOR GRANTS FOR FACILITY
EXPANSION.—The Secretary shall make a grant under this section
for the expansion, renovation, remodeling, or alteration (collectively
referred to in this section as ‘‘expansion’’) of a facility only if
the grant applicant provides such assurances as the Secretary determines to be satisfactory to ensure the following:
‘‘(1) For not less than 20 years after the grant is awarded,
the facility shall be used for the purposes of the research
for which the facility was expanded, as described in the grant
application.
‘‘(2) Sufficient funds will be available, as of the date of
completion of the expansion, for the effective use of the facility
for the purposes of the research for which the facility was
expanded.
‘‘(3) The proposed expansion—
‘‘(A) will increase the capability of the applicant to
conduct research for which the facility was expanded; or
‘‘(B) is necessary to improve the quality of the research
of the applicant.

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‘‘(e) AMOUNT OF GRANT.—The amount of a grant awarded under
this section shall be determined by the Secretary.
‘‘(f) FEDERAL SHARE.—The Federal share of the cost of any
expansion or security upgrade carried out using funds from a grant
provided under this section shall not exceed 50 percent.
‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to carry out this section such sums as are
necessary for each fiscal year.’’.
(b) SENSE OF CONGRESS ON INCREASING CAPACITY FOR
RESEARCH ON BIOSECURITY AND ANIMAL AND PLANT HEALTH DISEASES.—It is the sense of Congress that funding for the Agricultural
Research Service, the Animal and Plant Health Inspection Service,
and other agencies of the Department of Agriculture with responsibilities for biosecurity should be increased as necessary to improve
the capacity of the agencies to conduct research and analysis of,
and respond to, bioterrorism and animal and plant diseases.
SEC. 7222. INDIRECT COSTS FOR SMALL BUSINESS INNOVATION
RESEARCH GRANTS.

Section 1462 of the National Agricultural Research, Extension,
and Teaching Policy Act of 1977 (7 U.S.C. 3310) is amended—
(1) by inserting ‘‘(a) IN GENERAL.—’’ before ‘‘Except’’; and
(2) by adding at the end the following:
‘‘(b) EXCEPTION.—Subsection (a) shall not apply to a grant
awarded competitively under section 9 of the Small Business Act
(15 U.S.C. 638).’’.
SEC. 7223. CARBON CYCLE RESEARCH.

7 USC 6711.

Section 221 of the Agricultural Risk Protection Act of 2000
(Public Law 106–224; 114 Stat. 407), as amended by section 9009
of this Act, is amended—
(1) in subsection (a), by striking ‘‘Of the amount’’ and
all that follows through ‘‘to provide’’ and inserting ‘‘To the
extent funds are made available for this purpose, the Secretary
shall provide’’;
(2) in subsection (f), by striking ‘‘under subsection (a)’’
and inserting ‘‘for this section’’; and
(3) by adding at the end the following new subsection:
‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated for fiscal years 2002 through 2007 such sums
as may be necessary to carry out this section.’’.

Subtitle C—Repeal of Certain Activities
and Authorities
SEC. 7301. FOOD SAFETY RESEARCH INFORMATION OFFICE AND
NATIONAL CONFERENCE.

(a) REPEAL.—Subsections (b) and (c) of section 615 of the Agricultural Research, Extension, and Education Reform Act of 1998
(7 U.S.C. 7654(b) and (c)) are repealed.
(b) CONFORMING AMENDMENTS.—
(1) GENERALLY.—Section 615 of such Act is amended—
(A) in the section heading, by striking ‘‘AND NATIONAL
CONFERENCE’’;
(B) by striking ‘‘(a) FOOD SAFETY RESEARCH INFORMATION OFFICE.—’’;

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(C) by redesignating paragraphs (1), (2), and (3) as
subsections (a), (b), and (c), respectively, and moving the
margins 2 ems to the left;
(D) in subsection (b) (as so redesignated), by redesignating subparagraphs (A) and (B) as paragraphs (1) and
(2), respectively, and moving the margins 2 ems to the
left; and
(E) in subsection (c) (as so redesignated), by striking
‘‘this subsection’’ and inserting ‘‘this section’’.
(2) TABLE OF SECTIONS.—The table of sections for such
Act is amended by striking ‘‘and National Conference’’ in the
item relating to section 615.
SEC. 7302. REIMBURSEMENT OF EXPENSES UNDER SHEEP PROMOTION, RESEARCH, AND INFORMATION ACT OF 1994.

Section 617 of the Agricultural Research, Extension, and Education Reform Act of 1998 (Public Law 105–185; 112 Stat. 607)
is repealed.
SEC. 7303. MARKET EXPANSION RESEARCH.

Section 1436 of the Food Security Act of 1985 (7 U.S.C. 1632)
is repealed.
SEC. 7304. NATIONAL ADVISORY BOARD ON AGRICULTURAL WEATHER.

(a) REPEAL.—Section 1639 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5853) is repealed.
(b) CONFORMING AMENDMENT.—Section 1640(b) of the Food,
Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5854(b))
is amended by striking ‘‘take into’’ and all that follows through
‘‘Weather and’’.
SEC. 7305. AGRICULTURAL INFORMATION EXCHANGE WITH IRELAND.

Section 1420 of the National Agricultural Research, Extension
and Teaching Policy Act Amendments of 1985 (Public Law 99–
198; 99 Stat. 1551) is repealed.
SEC. 7306. PESTICIDE RESISTANCE STUDY.

Section 1437 of the National Agricultural Research, Extension,
and Teaching Policy Act Amendments of 1985 (Public Law 99–
198; 99 Stat. 1558) is repealed.
SEC. 7307. EXPANSION OF EDUCATION STUDY.

Section 1438 of the National Agricultural Research, Extension,
and Teaching Policy Act Amendments of 1985 (Public Law 99–
198; 99 Stat. 1559) is repealed.
SEC. 7308. TASK FORCE ON 10-YEAR STRATEGIC PLAN FOR AGRICULTURAL RESEARCH FACILITIES.

(a) REPEAL.—Section 4 of the Research Facilities Act (7 U.S.C.
390b) is repealed.
(b) CONFORMING AMENDMENT.—Section 2 of such Act (7 U.S.C.
390) is amended by striking paragraph (5).

Subtitle D—New Authorities
SEC. 7401. SUBTITLE DEFINITIONS.

7 USC 3319f
note.

In this subtitle:

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(1) DEPARTMENT.—The term ‘‘Department’’ means the
Department of Agriculture.
(2) SECRETARY.—The term ‘‘Secretary’’ means the Secretary
of Agriculture.

SEC. 7402. RESEARCH EQUIPMENT GRANTS.

The National Agricultural Research, Extension, and Teaching
Policy Act of 1977 is amended by inserting after section 1462
(7 U.S.C. 3310) the following:
7 USC 3310a.

‘‘SEC. 1462A. RESEARCH EQUIPMENT GRANTS.

‘‘(a) IN GENERAL.—The Secretary may make competitive grants
for the acquisition of special purpose scientific research equipment
for use in the food and agricultural sciences programs of eligible
institutions described in subsection (b).
‘‘(b) ELIGIBLE INSTITUTIONS.—The Secretary may make a grant
under this section to—
‘‘(1) a college or university; or
‘‘(2) a State cooperative institution.
‘‘(c) MAXIMUM AMOUNT.—The amount of a grant made to an
eligible institution under this section may not exceed $500,000.
‘‘(d) PROHIBITION ON CHARGE OF EQUIPMENT AS INDIRECT
COSTS.—The cost of acquisition or depreciation of equipment purchased with a grant under this section shall not be—
‘‘(1) charged as an indirect cost against another Federal
grant; or
‘‘(2) included as part of the indirect cost pool for purposes
of calculating the indirect cost rate of an eligible institution.
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to carry out this section such sums as may
be necessary for each of fiscal years 2002 through 2007.’’.
7 USC 3319b
note.

SEC. 7403. JOINT REQUESTS FOR PROPOSALS.

7 USC 3319b.

‘‘SEC. 1473B. JOINT REQUESTS FOR PROPOSALS.

(a) PURPOSES.—The purposes of this section are—
(1) to reduce the duplication of administrative functions
relating to grant awards and administration among Federal
agencies conducting similar types of research, education, and
extension programs;
(2) to maximize the use of peer review resources in
research, education, and extension programs; and
(3) to reduce the burden on potential recipients that may
offer similar proposals to receive competitive grants under different Federal programs in overlapping subject areas.
(b) AUTHORITY.—The National Agricultural Research, Extension, and Teaching Policy Act of 1977 is amended by inserting
after section 1473A (7 U.S.C. 3319a) the following:
‘‘(a) IN GENERAL.—In carrying out any competitive agricultural
research, education, or extension grant program authorized under
this or any other Act, the Secretary may cooperate with 1 or
more other Federal agencies (including the National Science
Foundation) in issuing joint requests for proposals, awarding grants,
and administering grants, for similar or related research, education,
or extension projects or activities.
‘‘(b) ADMINISTRATION.—

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‘‘(1) SECRETARY.—The Secretary may delegate authority
to issue requests for proposals, make grant awards, or administer grants, in whole or in part, to a cooperating Federal
agency.
‘‘(2) COOPERATING FEDERAL AGENCY.—The cooperating Federal agency may delegate to the Secretary authority to issue
requests for proposals, make grant awards, or administer
grants, in whole or in part.
‘‘(c) REGULATIONS.—The Secretary and a cooperating Federal
agency may agree to make applicable to recipients of grants—
‘‘(1) the post-award grant administration regulations
applicable to recipients of grants from the Secretary; or
‘‘(2) the post-award grant administration regulations
applicable to recipients of grants from the cooperating Federal
agency.
‘‘(d) JOINT PEER REVIEW PANELS.—Subject to section 1413B,
the Secretary and a cooperating Federal agency may establish joint
peer review panels for the purpose of evaluating grant proposals.’’.

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SEC. 7404. REVIEW OF AGRICULTURAL RESEARCH SERVICE.

7 USC 3101 note.

(a) IN GENERAL.—Not later than 90 days after the date of
enactment of this Act, the Secretary shall establish a task force
to—
(1) conduct a review of the Agricultural Research Service;
and
(2) evaluate the merits of establishing one or more National
Institutes focused on disciplines important to the progress of
food and agricultural science.
(b) MEMBERSHIP.—
(1) IN GENERAL.—The Task Force shall consist of 8 members, appointed by the Secretary, that—
(A) have a broad-based background in plant, animal,
and agricultural sciences research, food, nutrition, biotechnology, crop production methods, environmental
science, or related disciplines; and
(B) are familiar with the role and infrastructure used
to conduct Federal and private research, including—
(i) the Agricultural Research Service;
(ii) the National Institutes of Health;
(iii) the National Science Foundation;
(iv) the National Aeronautics and Space Administration;
(v) the Department of Energy laboratory system;
or
(vi) the Cooperative State Research, Education,
and Extension Service.
(2) PRIVATE SECTOR.—Of the members appointed under
paragraph (1), the Secretary shall appoint at least 6 members
that are members of the private sector or come from institutions
of higher education.
(3) PLANT AND AGRICULTURAL SCIENCES RESEARCH.—Of the
members appointed under paragraph (1), the Secretary shall
appoint at least 3 members that have an extensive background
and preeminence in the field of plant, animal, and agricultural
sciences research.
(4) CHAIRPERSON.—Of the members appointed under paragraph (1), the Secretary shall designate a Chairperson that

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7 USC 3319f.

PUBLIC LAW 107–171—MAY 13, 2002

has significant leadership experience in educational and
research institutions and indepth knowledge of the research
enterprises of the United States.
(5) CONSULTATION.—Before appointing members of the
Task Force under this subsection, the Secretary shall consult
with the National Academy of Sciences and the Office of Science
and Technology Policy.
(c) DUTIES.—The Task Force shall—
(1) conduct a review of the purpose, efficiency, effectiveness,
and impact on agricultural research of the Agricultural
Research Service;
(2) conduct a review and evaluation of the merits of establishing one or more National Institutes (such as National
Institutes for Plant and Agricultural Sciences) focused on disciplines important to the progress of food and agricultural
sciences, and, if establishment of one or more National
Institutes is recommended, provide further recommendations
to the Secretary, including the structure for establishing each
Institute, the multistate area location of each Institute, and
the amount of funding necessary to establish each Institute;
and
(3) submit the reports required by subsection (d).
(d) REPORTS.—Not later than 12 months after the date of enactment of this Act, the Task Force shall submit to the Committee
on Agriculture of the House of Representatives, the Committee
on Agriculture, Nutrition, and Forestry of the Senate, and the
Secretary—
(1) a report on the review and evaluation required under
subsection (c)(1); and
(2) a report on the review and evaluation required under
subsection (c)(2).
(e) FUNDING.—The Secretary shall use to carry out this section
not more than 0.1 percent of the amount of appropriations available
to the Agricultural Research Service for fiscal year 2003.
SEC. 7405. BEGINNING FARMER AND RANCHER DEVELOPMENT PROGRAM.

(a) DEFINITION OF BEGINNING FARMER OR RANCHER.—In this
section, the term ‘‘beginning farmer or rancher’’ means a person
that—
(1)(A) has not operated a farm or ranch; or
(B) has operated a farm or ranch for not more than 10
years; and
(2) meets such other criteria as the Secretary may establish.
(b) PROGRAM.—The Secretary shall establish a beginning farmer
and rancher development program to provide training, education,
outreach, and technical assistance initiatives for beginning farmers
or ranchers.
(c) GRANTS.—
(1) IN GENERAL.—In carrying out this section, the Secretary
shall make competitive grants to support new and established
local and regional training, education, outreach, and technical
assistance initiatives for beginning farmers or ranchers,
including programs and services (as appropriate) relating to—
(A) mentoring, apprenticeships, and internships;
(B) resources and referral;

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(C) assisting beginning farmers or ranchers in
acquiring land from retiring farmers and ranchers;
(D) innovative farm and ranch transfer strategies;
(E) entrepreneurship and business training;
(F) model land leasing contracts;
(G) financial management training;
(H) whole farm planning;
(I) conservation assistance;
(J) risk management education;
(K) diversification and marketing strategies;
(L) curriculum development;
(M) understanding the impact of concentration and
globalization;
(N) basic livestock and crop farming practices;
(O) the acquisition and management of agricultural
credit;
(P) environmental compliance;
(Q) information processing; and
(R) other similar subject areas of use to beginning
farmers or ranchers.
(2) ELIGIBILITY.—To be eligible to receive a grant under
this subsection, the recipient shall be a collaborative State,
tribal, local, or regionally-based network or partnership of
public or private entities, which may include—
(A) a State cooperative extension service;
(B) a Federal, State, or tribal agency;
(C) a community-based and nongovernmental organization;
(D) a college or university (including an institution
awarding an associate’s degree) or foundation maintained
by a college or university; or
(E) any other appropriate partner, as determined by
the Secretary.
(3) TERM OF GRANT.—The term of a grant under this subsection shall not exceed 3 years.
(4) MATCHING REQUIREMENT.—To be eligible to receive a
grant under this subsection, a recipient shall provide a match
in the form of cash or in-kind contributions in an amount
equal to 25 percent of the funds provided by the grant.
(5) SET-ASIDE.—Not less than 25 percent of funds used
to carry out this subsection for a fiscal year shall be used
to support programs and services that address the needs of—
(A) limited resource beginning farmers or ranchers (as
defined by the Secretary);
(B) socially disadvantaged beginning farmers or
ranchers (as defined in section 355(e) of the Consolidated
Farm and Rural Development Act (7 U.S.C. 2003(e)); and
(C) farmworkers desiring to become farmers or
ranchers.
(6) PROHIBITION.—A grant made under this subsection may
not be used for the planning, repair, rehabilitation, acquisition,
or construction of a building or facility.
(7) ADMINISTRATIVE COSTS.—The Secretary shall use not
more than 4 percent of the funds made available to carry
out this subsection for administrative costs incurred by the
Secretary in carrying out this section.
(d) EDUCATION TEAMS.—

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(1) IN GENERAL.—In carrying out this section, the Secretary
shall establish beginning farmer and rancher education teams
to develop curricula and conduct educational programs and
workshops for beginning farmers or ranchers in diverse geographical areas of the United States.
(2) CURRICULUM.—In promoting the development of curricula, the Secretary shall, to the maximum extent practicable,
include modules tailored to specific audiences of beginning
farmers or ranchers, based on crop or regional diversity.
(3) COMPOSITION.—In establishing an education team for
a specific program or workshop, the Secretary shall, to the
maximum extent practicable—
(A) obtain the short-term services of specialists with
knowledge and expertise in programs serving beginning
farmers or ranchers; and
(B) use officers and employees of the Department with
direct experience in programs of the Department that may
be taught as part of the curriculum for the program or
workshop.
(4) COOPERATION.—
(A) IN GENERAL.—In carrying out this subsection, the
Secretary shall cooperate, to the maximum extent practicable, with—
(i) State cooperative extension services;
(ii) Federal and State agencies;
(iii) community-based and nongovernmental
organizations;
(iv) colleges and universities (including an institution awarding an associate’s degree) or foundations
maintained by a college or university; and
(v) other appropriate partners, as determined by
the Secretary.
(B)
COOPERATIVE
AGREEMENT.—Notwithstanding
chapter 63 of title 31, United States Code, the Secretary
may enter into a cooperative agreement to reflect the terms
of any cooperation under subparagraph (A).
(e) CURRICULUM AND TRAINING CLEARINGHOUSE.—The Secretary shall establish an online clearinghouse that makes available
to beginning farmers or ranchers education curricula and training
materials and programs, which may include online courses for direct
use by beginning farmers or ranchers.
(f) STAKEHOLDER INPUT.—In carrying out this section, the Secretary shall seek stakeholder input from—
(1) beginning farmers and ranchers;
(2) national, State, tribal, and local organizations and other
persons with expertise in operating beginning farmer and
rancher programs; and
(3) the Advisory Committee on Beginning Farmers and
Ranchers established under section 5 of the Agricultural Credit
Improvement Act of 1992 (7 U.S.C. 1929 note; Public Law
102–554).
(g) PARTICIPATION BY OTHER FARMERS AND RANCHERS.—
Nothing in this section prohibits the Secretary from allowing
farmers and ranchers who are not beginning farmers or ranchers
from participating in programs authorized under this section to
the extent that the Secretary determines that such participation

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is appropriate and will not detract from the primary purpose of
educating beginning farmers and ranchers.
(h) Authorization of Appropriations.—There are authorized to
be appropriated to carry out this section such sums as may be
necessary for each of fiscal years 2002 through 2007.
SEC. 7406. SENSE OF CONGRESS REGARDING DOUBLING OF FUNDING
FOR AGRICULTURAL RESEARCH.

It is the sense of Congress that—
(1) Federal funding for food and agricultural research has
been essentially constant for 2 decades, putting at risk the
scientific base on which food and agricultural advances have
been made;
(2) the resulting increase in the relative proportion of private sector, industry investments in food and agricultural
research has led to questions about the independence and objectivity of research and outreach conducted by the Federal and
university research sectors; and
(3) funding for food and agricultural research should be
at least doubled over the next 5 fiscal years—
(A) to restore the balance between public and private
sector funding for food and agricultural research; and
(B) to maintain the scientific base on which food and
agricultural advances are made.
SEC. 7407. ORGANIC PRODUCTION AND MARKET DATA INITIATIVES.

7 USC 5925c.

The Secretary shall ensure that segregated data on the production and marketing of organic agricultural products is included
in the ongoing baseline of data collection regarding agricultural
production and marketing.
SEC. 7408. INTERNATIONAL ORGANIC RESEARCH COLLABORATION.

7 USC 5925d.

The Secretary, acting through the Agricultural Research Service
(including the National Agricultural Library) and the Economic
Research Service, shall facilitate access by research and extension
professionals, farmers, and other interested persons in the United
States to, and the use by those persons of, organic research conducted outside the United States.

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SEC. 7409. REPORT ON PRODUCERS AND HANDLERS OF ORGANIC AGRICULTURAL PRODUCTS.

7 USC 5925b
note.

Not later than 1 year after funds are made available to carry
out this section, the Secretary shall submit to Congress a report
that—
(1) describes—
(A) the extent to which producers and handlers of
organic agricultural products are contributing to research
and promotion programs of the Department;
(B) the extent to which producers and handlers of
organic agricultural products are surveyed for ideas for
research and promotion;
(C) ways in which the programs reflect the contributions made by producers and handlers of organic agricultural products and directly benefit the producers and handlers; and
(D) the implementation of initiatives that directly benefit organic producers and handlers; and

Deadline.

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PUBLIC LAW 107–171—MAY 13, 2002
(2) evaluates industry and other proposals for improving
the treatment of certified organic agricultural products under
Federal marketing orders, including proposals to target additional resources for research and promotion of organic products
and to differentiate between certified organic and other products in new or existing volume limitations or other orderly
marketing requirements.

Deadline.

SEC. 7410. REPORT ON GENETICALLY MODIFIED PEST-PROTECTED
PLANTS.

It is the sense of Congress that, not later than 1 year after
the date of enactment of this Act, the Secretary should—
(1) review the recommendations of the Committee on
Genetically Modified Pest-Protected Plants of the Board on
Agriculture and Natural Resources of the National Research
Council made during 2000 and the Committee on Environmental Impacts Associated with Commercialization of
Transgenic Plants made during 2002, concerning food safety,
ecological research, monitoring needs for transgenic crops with
plant incorporated protectants, and the environmental effects
of transgenic plants; and
(2) submit to the Committee on Agriculture of the House
of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes actions
taken to implement those recommendations by agencies within
the Department, including agencies that develop or implement
programs or objectives relating to marketing, regulation, food
safety, research, education, or economics.
7 USC 5925a
note.

SEC. 7411. STUDY OF NUTRIENT BANKING.

(a) IN GENERAL.—The Secretary may conduct a study to
evaluate nutrient banking for the purpose of enhancing the health
and viability of watersheds in areas with large concentrations of
animal producing units.
(b) COMPONENTS.—In conducting any study under subsection
(a), the Secretary shall evaluate the costs, needs, and means by
which litter may be collected and distributed outside the applicable
watershed to reduce potential point source and nonpoint source
phosphorous pollution.
(c) REPORT.—The Secretary shall submit to the Committee on
Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a report
that describes the results of any study conducted under subsection
(a).
SEC. 7412. GRANTS FOR YOUTH ORGANIZATIONS.

Title IV of the Agricultural Research, Extension, and Education
Reform Act of 1998 (7 U.S.C. 7621 et seq.) (as amended by section
7206(e)) is amended by adding at the end the following:
7 USC 7630.

‘‘SEC. 410. GRANTS FOR YOUTH ORGANIZATIONS.

‘‘(a) IN GENERAL.—The Secretary, acting through the Administrator of the Cooperative State Research, Education, and Extension
Service, shall make grants to the Girl Scouts of the United States
of America, the Boy Scouts of America, the National 4–H Council,
and the National FFA Organization to establish pilot projects to
expand the programs carried out by the organizations in rural
areas and small towns (including, with respect to the National

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4–H Council, activities provided for in Public Law 107–19 (115
Stat. 153)).
‘‘(b) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall make available $8,000,000 for fiscal year
2002, which shall remain available until expended.
‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section such sums as are
necessary for each of fiscal years 2003 through 2007.’’.

Subtitle E—Miscellaneous
SEC. 7501. RESIDENT INSTRUCTION AND DISTANCE EDUCATION AT
INSTITUTIONS OF HIGHER EDUCATION IN UNITED
STATES INSULAR AREAS.

7 USC 3361 note.

(a) PURPOSE.—It is the purpose of this subtitle to promote
and strengthen higher education in the food and agricultural
sciences at institutions of higher education (as defined in section
101(a) of the Higher Education Act of 1965 (20 U.S.C. 1001(a)))
that have demonstrable capacity to carry out teaching and extension
programs in food and agricultural sciences and that are located
in the insular areas of the Commonwealth of Puerto Rico, the
Virgin Islands of the United States, Guam, American Samoa, the
Commonwealth of the Northern Mariana Islands, the Federated
States of Micronesia, the Republic of the Marshall Islands, or the
Republic of Palau by formulating and administering programs to
enhance teaching programs in agriculture, natural resources, forestry, veterinary medicine, home economics, and disciplines closely
allied to the food and agriculture production and delivery systems.
SEC. 7502. DEFINITIONS.

(a) IN GENERAL.—Section 1404 of the National Agricultural
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3103) is amended—
(1) by redesignating paragraphs (10) through (17) as paragraphs (11) through (18), respectively;
(2) by inserting after paragraph (9) the following:
‘‘(10) INSULAR AREA.—The term ‘insular area’ means—
‘‘(A) the Commonwealth of Puerto Rico;
‘‘(B) Guam;
‘‘(C) American Samoa;
‘‘(D) the Commonwealth of the Northern Mariana
Islands;
‘‘(E) the Federated States of Micronesia;
‘‘(F) the Republic of the Marshall Islands;
‘‘(G) the Republic of Palau; and
‘‘(H) the Virgin Islands of the United States.’’; and
(3) by striking paragraph (13) (as so redesignated) and
inserting the following:
‘‘(13) STATE.—The term ‘State’ means—
‘‘(A) a State;
‘‘(B) the District of Columbia; and
‘‘(C) any insular area.’’.
(b) EFFECT OF AMENDMENTS.—The amendments made by subsection (a) shall not affect any basis for distribution of funds by
formula (in effect on the date of enactment of this Act) to—
(1) the Federated States of Micronesia;

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(2) the Republic of the Marshall Islands; or
(3) the Republic of Palau.

SEC. 7503. RESIDENT INSTRUCTION AND DISTANCE EDUCATION
GRANTS PROGRAM FOR INSULAR AREA INSTITUTIONS
OF HIGHER EDUCATION.

The National Agricultural Research, Extension, and Teaching
Policy Act of 1977 (7 U.S.C. 3101 et seq.) is amended by adding
at the end the following:

‘‘Subtitle O—Institutions of Higher
Education in Insular Areas
7 USC 3361.

‘‘SEC. 1489. DEFINITION.

‘‘For the purposes of this subtitle, the term ‘eligible institution’
means an institution of higher education (as defined in section
101(a) of the Higher Education Act of 1965 (20 U.S.C. 1001(a))
in an insular area that has demonstrable capacity to carry out
teaching and extension programs in the food and agricultural
sciences.
7 USC 3362.

‘‘SEC. 1490. DISTANCE EDUCATION GRANTS FOR INSULAR AREAS.

‘‘(a) IN GENERAL.—The Secretary may make competitive or
noncompetitive grants to eligible institutions in insular areas to
strengthen the capacity of such institutions to carry out distance
food and agricultural education programs using digital network
technologies.
‘‘(b) USE.—Grants made under this section shall be used—
‘‘(1) to acquire the equipment, instrumentation, networking
capability, hardware and software, digital network technology,
and infrastructure necessary to teach students and teachers
about technology in the classroom;
‘‘(2) to develop and provide educational services (including
faculty development) to prepare students or faculty seeking
a degree or certificate that is approved by the State or a
regional accrediting body recognized by the Secretary of Education;
‘‘(3) to provide teacher education, library and media specialist training, and preschool and teacher aid certification to
individuals who seek to acquire or enhance technology skills
in order to use technology in the classroom or instructional
process;
‘‘(4) to implement a joint project to provide education
regarding technology in the classroom with a local educational
agency, community-based organization, national nonprofit
organization, or business; or
‘‘(5) to provide leadership development to administrators,
board members, and faculty of eligible institutions with institutional responsibility for technology education.
‘‘(c) LIMITATION ON USE OF GRANT FUNDS.—Funds provided
under this section shall not be used for the planning, acquisition,
construction, rehabilitation, or repair of a building or facility.
‘‘(d) ADMINISTRATION OF PROGRAM.—The Secretary may carry
out this section in a manner that recognizes the different needs
and opportunities for eligible institutions in the Atlantic and Pacific
Oceans.

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‘‘(e) MATCHING REQUIREMENT.—
‘‘(1) IN GENERAL.—The Secretary may establish a requirement that an eligible institution receiving a grant under this
section shall provide matching funds from non-Federal sources
in an amount equal to not less than 50 percent of the grant.
‘‘(2) WAIVERS.—If the Secretary establishes a matching
requirement under paragraph (1), the Secretary shall retain
an option to waive the requirement for an eligible institution
for any fiscal year if the Secretary determines that the institution will be unlikely to meet the matching requirement for
the fiscal year.
‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section such sums as may
be necessary for each of fiscal years 2002 through 2007.
‘‘SEC. 1491. RESIDENT INSTRUCTION GRANTS FOR INSULAR AREAS.

7 USC 3363.

‘‘(a) IN GENERAL.—The Secretary of Agriculture shall make
competitive grants to eligible institutions to—
‘‘(1) strengthen institutional educational capacities,
including libraries, curriculum, faculty, scientific instrumentation, instruction delivery systems, and student recruitment and
retention, in order to respond to identified State, regional,
national, or international education needs in the food and agricultural sciences;
‘‘(2) attract and support undergraduate and graduate students in order to educate them in identified areas of national
need in the food and agriculture sciences;
‘‘(3) facilitate cooperative initiatives between two or more
insular area eligible institutions, or between those institutions
and units of State Government or organizations in the private
sector, to maximize the development and use of resources such
as faculty, facilities, and equipment to improve food and agricultural sciences teaching programs; and
‘‘(4) conduct undergraduate scholarship programs to assist
in meeting national needs for training food and agricultural
scientists.
‘‘(b) GRANT REQUIREMENTS.—
‘‘(1) The Secretary of Agriculture shall ensure that each
eligible institution, prior to receiving grant funds under subsection (a), shall have a significant demonstrable commitment
to higher education programs in the food and agricultural
sciences and to each specific subject area for which grant funds
under this section are to be used.
‘‘(2) The Secretary of Agriculture may require that any
grant awarded under this section contain provisions that
require funds to be targeted to meet the needs identified in
section 1402.
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary for each of the
fiscal years 2002 through 2007 to carry out this section.’’.
SEC. 7504. DECLARATION OF EXTRAORDINARY EMERGENCY AND
RESULTING AUTHORITIES.

(a) REVIEW OF PAYMENT OF COMPENSATION.—Section 415(e)
of the Plant Protection Act (7 U.S.C. 7715(e)) is amended by
inserting before the final period the following: ‘‘or a review of
longer than 60 days by any officer or employee of the Federal

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PUBLIC LAW 107–171—MAY 13, 2002

Government other than the Secretary or the designee of the Secretary’’.
(b) REVIEW OF CERTAIN DECISIONS.—Section 442 of the Plant
Protection Act (7 U.S.C. 7772) is amended by adding at the end
the following new subsection:
‘‘(c) SECRETARIAL DISCRETION.—The action of any officer,
employee, or agent of the Secretary in carrying out this Act,
including determining the amount of and making any payment
authorized to be made under this title, shall not be subject to
a review of longer than 60 days by any officer or employee of
the Federal Government other than the Secretary or the designee
of the Secretary.’’.
(c) METHYL BROMIDE.—The Plant Protection Act (7 U.S.C. 7701
et seq.) is amended by inserting after section 418 the following
new section:
7 USC 7719.

Deadline.
Publication.

Deadline.

‘‘SEC. 419. METHYL BROMIDE.

‘‘(a) IN GENERAL.—The Secretary, upon request of State, local,
or tribal authorities, shall determine whether methyl bromide treatments or applications required by State, local, or tribal authorities
to prevent the introduction, establishment, or spread of plant pests
(including diseases) or noxious weeds should be authorized as an
official control or official requirement. The Secretary shall not
authorize such treatments or applications unless the Secretary finds
there is no other registered, effective, and economically feasible
alternative available.
‘‘(b) METHYL BROMIDE ALTERNATIVE.—The Secretary, in consultation with State, local and tribal authorities, shall establish
a program to identify alternatives to methyl bromide for treatment
and control of plant pests and weeds. For uses where no registered,
effective, economically feasible alternatives available can currently
be identified, the Secretary shall initiate research programs to
develop alternative methods of control and treatment.
‘‘(c) REGISTRY.—Not later than 180 days after the date of enactment of this section, the Secretary shall publish, and thereafter
maintain, a registry of State, local, and tribal requirements authorized by the Secretary under this section.
‘‘(d) ADMINISTRATION.—
‘‘(1) TIMELINE FOR DETERMINATION.—Upon the promulgation of regulations to carry out this section, the Secretary
shall make the determination required by subsection (a) not
later than 90 days after receiving the request for such a determination.
‘‘(2) CONSTRUCTION.—Nothing in this section shall be construed to alter or modify the authority of the Administrator
of the Environmental Protection Agency or to provide any
authority to the Secretary of Agriculture under the Clean Air
Act or regulations promulgated under the Clean Air Act.’’.
SEC.

7505.

AGRICULTURAL BIOTECHNOLOGY RESEARCH
DEVELOPMENT FOR DEVELOPING COUNTRIES.

AND

Title IV of the Agricultural Research, Extension, and Education
Reform Act of 1998 (7 U.S.C. 7621 et seq.) is amended by adding
at the end the following:

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PUBLIC LAW 107–171—MAY 13, 2002
‘‘SEC.

411.

116 STAT. 467

AGRICULTURAL BIOTECHNOLOGY RESEARCH
DEVELOPMENT FOR DEVELOPING COUNTRIES.

AND

7 USC 7631.

‘‘(a) ELIGIBLE ENTITY.—In this section, the term ‘eligible entity’
means—
‘‘(A) an institution of higher education that offers a
curriculum in agriculture or the biosciences;
‘‘(B) a nonprofit organization; or
‘‘(C) a consortium of for-profit institutions and agricultural research institutions.
‘‘(b) GRANT PROGRAM.—
‘‘(1) IN GENERAL.—The Secretary (acting through the Foreign Agricultural Service) shall establish and administer a program to make competitive grants to eligible entities to develop
agricultural biotechnology for developing countries.
‘‘(2) USE OF FUNDS.—Funds provided to an eligible entity
under this section may be used for projects that use biotechnology to—
‘‘(A) enhance the nutritional content of agricultural
products that can be grown in developing countries;
‘‘(B) increase the yield and safety of agricultural products that can be grown in developing countries;
‘‘(C) increase the yield of agricultural products that
are drought- and stress-resistant and that can be grown
in developing countries;
‘‘(D) extend the growing range of crops that can be
grown in developing countries;
‘‘(E) enhance the shelf-life of fruits and vegetables
grown in developing countries;
‘‘(F) develop environmentally sustainable agricultural
products that can be grown in developing countries; and
‘‘(G) develop vaccines to immunize against life-threatening illnesses and other medications that can be administered by consuming genetically-engineered agricultural
products.
‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as may be necessary to carry out
this section for each of fiscal years 2002 through 2007.’’.
SEC.

7506.

LAND ACQUISITION AUTHORITY, NATIONAL
RESEARCH LABORATORY, DAWSON, GEORGIA.

PEANUT

The limitation on the authority of the Agricultural Research
Service to acquire lands by purchase using funds appropriated
under the heading AGRICULTURAL RESEARCH SERVICE-SALARIES AND
EXPENSES in the Agriculture, Rural Development, Food and Drug
Administration, and Related Agencies Appropriations Act, 2002
(Public Law 107–76; 115 Stat. 708), shall not apply to the purchase
of land for a research farm for the National Peanut Research
Laboratory in Dawson, Georgia, for which a lease with an option
to purchase has been entered into before the date of enactment
of this Act.

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TITLE VIII—FORESTRY
Subtitle A—Cooperative Forestry
Assistance Act of 1978
SEC.

16 USC 2103
note.

8001.

REPEAL OF FORESTRY INCENTIVES
STEWARDSHIP INCENTIVE PROGRAM.

PROGRAM

AND

(a) REPEAL.—The Cooperative Forestry Assistance Act of 1978
is amended by striking section 4 (16 U.S.C. 2103) and section
6 (16 U.S.C. 2103b).
(b) USE OF REMAINING FUNDS.—Notwithstanding the amendment made by subsection (a), the Secretary of Agriculture may
use funds appropriated for fiscal year 2002 for the forestry incentives program or the stewardship incentive program, but not
expended before the date of enactment of this Act, to carry out
sections 4 and 6 of the Cooperative Forestry Assistance Act of
1978, as in effect on the date before the date of enactment of
this Act.
SEC. 8002. ESTABLISHMENT OF FOREST LAND ENHANCEMENT PROGRAM.

16 USC 2103
note.

(a) PURPOSES.—The purposes of this section are—
(1) to strengthen the commitment of the Secretary of Agriculture to sustainable forest management to enhance the
productivity of timber, fish and wildlife habitat, soil and water
quality, wetland, recreational resources, and aesthetic values
of forest land; and
(2) to establish a coordinated and cooperative Federal,
State, and local sustainable forestry program for the establishment, management, maintenance, enhancement, and restoration of forests on nonindustrial private forest land.
(b) FOREST LAND ENHANCEMENT PROGRAM.—The Cooperative
Forestry Assistance Act of 1978 is amended by inserting after
section 3 (16 U.S.C. 2102) the following:

16 USC 2103.

‘‘SEC. 4. FOREST LAND ENHANCEMENT PROGRAM.

‘‘(a) ESTABLISHMENT.—
‘‘(1) IN GENERAL.—The Secretary of Agriculture shall establish a forest land enhancement program—
‘‘(A) to provide financial assistance to State foresters;
and
‘‘(B) to encourage the long-term sustainability of nonindustrial private forest lands in the United States by
assisting the owners of nonindustrial private forest lands,
through State foresters, in more actively managing the
nonindustrial private forest lands and related resources
of those owners through the use of State, Federal, and
private sector resource management expertise, financial
assistance, and educational programs.
‘‘(2) COORDINATION AND CONSULTATION.—The Secretary,
acting through State foresters, shall implement the program—
‘‘(A) in coordination with the State Forest Stewardship
Coordinating Committees; and
‘‘(B) in consultation with other Federal, State, and
local natural resource management agencies, institutions

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of higher education, and a broad range of private sector
interests.
‘‘(b) PROGRAM OBJECTIVES.—In implementing the program, the
Secretary shall target resources to achieve the following objectives:
‘‘(1) Investing in practices to establish, restore, protect,
manage, maintain, and enhance the health and productivity
of the nonindustrial private forest lands in the United States
for timber, habitat for flora and fauna, soil, water, and air
quality, wetlands, and riparian buffers.
‘‘(2) Ensuring that afforestation, reforestation, improvement
of poorly stocked stands, timber stand improvement, practices
necessary to improve seedling growth and survival, and growth
enhancement practices occur where needed to enhance and
sustain the long-term productivity of timber and nontimber
forest resources to help meet future public demand for all
forest resources and provide environmental benefits.
‘‘(3) Reducing the risks and helping restore, recover, and
mitigate the damage to forests caused by fire, insects, invasive
species, disease, and damaging weather.
‘‘(4) Increasing and enhancing carbon sequestration
opportunities.
‘‘(5) Enhancing implementation of agroforestry practices.
‘‘(6) Maintaining and enhancing the forest landbase and
leverage State and local financial and technical assistance to
owners that promote the same conservation and environmental
values.
‘‘(7) Preserving the aesthetic quality of nonindustrial private forest lands and providing opportunities for outdoor recreation.
‘‘(c) STATE PRIORITY PLAN.—
‘‘(1) DEVELOPMENT.—The State Forester and State Forest
Stewardship Coordinating Committee of a State shall jointly
develop and submit to the Secretary a State priority plan
that is intended to promote forest management objectives in
that State.
‘‘(2) REPORT.—Not later than September 30, 2006, each
State that implemented a State priority plan shall submit
to the Secretary a report describing the status of all activities
and practices funded under the program as of that date.
‘‘(d) OWNER ELIGIBILITY FOR ASSISTANCE.—
‘‘(1) ELIGIBILITY CRITERIA.—To be eligible for cost-share
assistance under the program, an owner of nonindustrial private forest lands shall agree—
‘‘(A) to develop and implement, in cooperation with
a State forester, another State official, or a professional
resources manager, a management plan that—
‘‘(i) except as provided in paragraph (2) or (3),
provides for the treatment of not more than 1,000
acres of nonindustrial private forest lands;
‘‘(ii) is approved by the State forester; and
‘‘(iii) addresses site specific activities and practices;
and
‘‘(B) to implement approved activities and practices
in a manner consistent with the management plan for
a period of not less than 10 years, unless the State forester
approves a modification to the plan.

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‘‘(2) PUBLIC BENEFIT EXCEPTION.—The Secretary may
increase the acreage limitation specified in paragraph (1)(A)(i)
to not more than 5,000 acres for an owner of nonindustrial
private forest lands if the Secretary, in consultation with the
State forester, determines that significant public benefits will
accrue as a result of the provision of cost-share assistance
under the program for the treatment of the additional acreage.
‘‘(3) PLAN DEVELOPMENT EXCEPTION.—An owner may
receive cost-share assistance under the program for the purpose
of developing a management plan under subsection (e) that
provides for the treatment of acreage in excess of the acreage
limitations specified in paragraphs (1)(A)(i) and (2), except that
the owner’s eligibility for cost-share assistance to implement
approved activities and practices under the management plan
remains subject to the acreage limitation specified in paragraph
(1)(A)(i) or, if the Secretary makes the determination described
in paragraph (2), the acreage limitation specified in that paragraph.
‘‘(e) MANAGEMENT PLAN.—
‘‘(1) SUBMISSION AND CONTENT.—An owner of nonindustrial
private forest lands that seeks to participate in the program
shall submit to the State forester of the State in which the
lands are located a management plan that—
‘‘(A) identifies and describes projects and activities to
be carried out by the owner to protect or enhance soil,
water, air, range and aesthetic quality, recreation, timber,
water, wetland, or fish and wildlife resources on the lands
in a manner that is compatible with the objectives of the
owner;
‘‘(B) addresses any criteria established by the State
and the applicable Committee; and
‘‘(C) meets the other requirements of this section.
‘‘(2) LANDS COVERED.—At a minimum, the management
plan shall apply to those portions of the nonindustrial private
forest lands of the owner on which any project or activity
funded under the program will be carried out. In a case in
which a project or activity may affect acreage outside the portion of the land on which the project or activity is carried
out, the management plan shall apply to all lands of the owner
that are in forest cover and may be affected by the project
or activity.
‘‘(f) APPROVED ACTIVITIES.—
‘‘(1) STATE LIST.—The Secretary shall develop for each State
a list of approved forest activities and practices eligible for
cost-share assistance that meets the purposes of the program.
The Secretary shall develop the list for a State in consultation
with the State forester and the Committee for that State.
‘‘(2) TYPES OF ACTIVITIES.—Approved activities and practices under paragraph (1) may consist of activities and practices
for the following purposes:
‘‘(A) The establishment, management, maintenance,
and restoration of forests for shelterbelts, windbreaks, aesthetic quality, and other conservation purposes.
‘‘(B) The sustainable growth and management of forests
for timber production.
‘‘(C) The restoration, use, and enhancement of forest
wetland and riparian areas.

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‘‘(D) The protection of water quality and watersheds
through—
‘‘(i) the planting of trees in riparian areas; and
‘‘(ii) the enhanced management and maintenance
of native vegetation on land vital to water quality.
‘‘(E) The management, maintenance, restoration, or
development of habitat for plants, fish, and wildlife.
‘‘(F) The control, detection, monitoring, and prevention
of the spread of invasive species and pests on nonindustrial
private forest lands.
‘‘(G) The restoration of nonindustrial private forest
land affected by invasive species and pests.
‘‘(H) The conduct of other management activities, such
as the reduction of hazardous fuels, that reduce the risks
to forests posed by, and that restore, recover, and mitigate
the damage to forests caused by, fire or any other catastrophic event, as determined by the Secretary.
‘‘(I) The development of management plans;
‘‘(J) The conduct of energy conservation and carbon
sequestration activities.
‘‘(K) The conduct of other activities approved by the
Secretary, in consultation with the State forester and the
appropriate Committees.
‘‘(g) REIMBURSEMENT OF ELIGIBLE ACTIVITIES.—
‘‘(1) IN GENERAL.—In the case of an eligible owner that
has an approved management plan, the Secretary shall share
the cost of implementing the approved activities and practices
that the Secretary determines are appropriate.
‘‘(2) RATE.—The Secretary shall determine the appropriate
reimbursement rate for cost-share payments under paragraph
(1) and the schedule for making those payments.
‘‘(3) MAXIMUM COST SHARE.—The Secretary shall not make
cost-share payments under this subsection to an owner in an
amount in excess of 75 percent, or a lower percentage as determined by the State forester, of the total cost to the owner
to implement the approved activities and practices under the
management plan.
‘‘(4) AGGREGATE PAYMENT LIMIT.—The Secretary shall
determine the maximum aggregate amount of cost-share payments that an owner may receive under the program.
‘‘(5) CONSULTATION.—The Secretary shall make determinations under this subsection in consultation with the State forester.
‘‘(h) RECAPTURE.—
‘‘(1) IN GENERAL.—The Secretary shall establish and implement a mechanism to recapture payments made to an owner
in the event that the owner fails to implement an approved
activity or practice specified in the management plan for which
the owner received cost-share payments.
‘‘(2) ADDITIONAL REMEDY.—The remedy provided in paragraph (1) is in addition to any other remedy available to the
Secretary.
‘‘(i) DISTRIBUTION OF COST-SHARE FUNDS.—The Secretary,
acting through the State foresters, shall distribute funds available
for cost sharing under the program only after giving appropriate
consideration to the following factors:

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‘‘(1) The public benefits that would result from the distribution.
‘‘(2) The total acreage of nonindustrial private forest lands
in each State.
‘‘(3) The potential productivity of those lands, as determined
by the Secretary.
‘‘(4) The number of owners eligible for cost sharing in
each State.
‘‘(5) The opportunities to enhance nontimber resources on
those lands, including—
‘‘(A) the protection of riparian buffers and forest wetland;
‘‘(B) the preservation of fish and wildlife habitat;
‘‘(C) the enhancement of soil, air, and water quality;
and
‘‘(D) the preservation of aesthetic quality and
opportunities for outdoor recreation.
‘‘(6) The anticipated demand for timber and nontimber
resources in each State.
‘‘(7) The need to improve forest health to minimize the
damaging effects of catastrophic fire, insects, disease, or
weather.
‘‘(8) The need and demand for agroforestry practices in
each State.
‘‘(9) The need to maintain and enhance the forest landbase.
‘‘(10) The need for afforestation, reforestation, and timber
stand improvement.
‘‘(j) AVAILABILITY OF FUNDS.—The Secretary shall use
$100,000,000 of funds of the Commodity Credit Corporation to
carry out the Program during the period beginning on the date
of enactment of the Farm Security and Rural Investment Act of
2002 and ending on September 30, 2007.
‘‘(k) DEFINITIONS.—In this section:
‘‘(1) NONINDUSTRIAL PRIVATE FOREST LANDS.—The term
‘nonindustrial private forest lands’ means rural lands, as determined by the Secretary, that—
‘‘(A) have existing tree cover or are suitable for growing
trees; and
‘‘(B) are owned by any nonindustrial private individual,
group, association, corporation, Indian tribe, or other private legal entity so long as the individual, group, association, corporation, tribe, or entity has definitive decisionmaking authority over the lands.
‘‘(2) COMMITTEE.—The terms ‘State Forest Stewardship
Coordinating Committee’ and ‘Committee’ means a State Forest
Stewardship Coordinating Committee established under section
19(b).
‘‘(3) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning
given the term in section 4 of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450b).
‘‘(4) OWNER.—The term ‘owner’ means an owner of nonindustrial private forest land.
‘‘(5) PROGRAM.—The term ‘program’ means the forest land
enhancement program established by this section.
‘‘(6) SECRETARY.—The term ‘Secretary’ means the Secretary
of Agriculture.

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‘‘(7) STATE FORESTER.—The term ‘State forester’ means the
director or other head of a State Forestry Agency or equivalent
State official.’’.
(c) CONFORMING AMENDMENT.—Section 246(b)(2) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6962(b)(2))
is amended by striking ‘‘forestry incentive program’’ and inserting
‘‘forest land enhancement program’’.
SEC. 8003. ENHANCED COMMUNITY FIRE PROTECTION.

(a) FINDINGS.—Congress finds the following:
(1) The severity and intensity of wildland fires has
increased dramatically over the past few decades as a result
of past fire and land management policies.
(2) The record 2000 fire season is a prime example of
what can be expected if action is not taken.
(3) Wildland fires threaten not only the forested resources
of the United States, but also the thousands of communities
intermingled with the wildlands in the wildland-urban interface.
(4) The National Fire Plan, if implemented to achieve
appropriate priorities, is the proper, coordinated, and most
effective means to address the issue of wildfires.
(5) While adequate authorities exist to tackle the wildfire
issues at the landscape level on Federal lands, there is limited
authority to take action on most private lands, and the largest
threat to life and property exists on private lands.
(6) There is a significant Federal interest in enhancing
community protection from wildfire.
(b) ENHANCED PROTECTION.—The Cooperative Forestry Assistance Act of 1978 is amended by inserting after section 10 (16
U.S.C. 2106) the following:
‘‘SEC. 10A. ENHANCED COMMUNITY FIRE PROTECTION.

16 USC 2106c
note.

16 USC 2106c.

‘‘(a)

COOPERATIVE MANAGEMENT RELATED TO WILDFIRE
THREATS.—The Secretary may cooperate with State foresters and
equivalent State officials in the management of lands in the United
States for the following purposes:
‘‘(1) Aid in wildfire prevention and control.
‘‘(2) Protect communities from wildfire threats.
‘‘(3) Enhance the growth and maintenance of trees and
forests that promote overall forest health.
‘‘(4) Ensure the continued production of all forest resources,
including timber, outdoor recreation opportunities, wildlife
habitat, and clean water, through conservation of forest cover
on watersheds, shelterbelts, and windbreaks.
‘‘(b) COMMUNITY AND PRIVATE LAND FIRE ASSISTANCE PROGRAM.—
‘‘(1) ESTABLISHMENT; PURPOSE.—The Secretary shall establish a Community and Private Land Fire Assistance program
(in this subsection referred to as the ‘Program’)—
‘‘(A) to focus the Federal role in promoting optimal
firefighting efficiency at the Federal, State, and local levels;
‘‘(B) to augment Federal projects that establish landscape level protection from wildfires;
‘‘(C) to expand outreach and education programs to
homeowners and communities about fire prevention; and
‘‘(D) to establish space around homes and property
of private landowners that is defensible against wildfires.

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‘‘(2) ADMINISTRATION AND IMPLEMENTATION.—The Program
shall be administered by the Forest Service and implemented
through State foresters or equivalent State officials.
‘‘(3) COMPONENTS.—In coordination with existing authorities under this Act, the Secretary, in consultation with the
State forester or equivalent State official, may undertake on
non-Federal lands—
‘‘(A) fuel hazard mitigation and prevention;
‘‘(B) invasive species management;
‘‘(C) multiresource wildfire planning;
‘‘(D) community protection planning;
‘‘(E) community and landowner education enterprises,
including the program known as FIREWISE;
‘‘(F) market development and expansion;
‘‘(G) improved wood utilization; and
‘‘(H) special restoration projects.
‘‘(4) CONSENT REQUIRED.—Program activities undertaken
by the Secretary on non-Federal lands shall be undertaken
only with the consent of the owner of the lands.
‘‘(5) CONSIDERATIONS.—The Secretary shall use persons in
the local community wherever possible to carry out projects
under the Program.
‘‘(c) CONSULTATION.—In carrying out this section, the Secretary
shall consult with the Administrator of the United States Fire
Administration, the Director of the National Institute of Standards
and Technology, and the heads of other Federal agencies, as necessary.
‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There are hereby
authorized to be appropriated to the Secretary to carry out this
section—
‘‘(1) $35,000,000 for each of fiscal years 2002 through 2007;
and
‘‘(2) such sums as are necessary for fiscal years thereafter.’’.

Subtitle B—Amendments to Other Laws
SEC. 8101. SUSTAINABLE FORESTRY OUTREACH INITIATIVE; RENEWABLE RESOURCES EXTENSION ACTIVITIES.

(a) SUSTAINABLE FORESTRY OUTREACH INITIATIVE.—The Renewable Resources Extension Act of 1978 is amended by inserting
after section 5A (16 U.S.C. 1674a) the following:
16 USC 1674b.

‘‘SEC. 5B. SUSTAINABLE FORESTRY OUTREACH INITIATIVE.

‘‘The Secretary shall establish a program, to be known as
the ‘Sustainable Forestry Outreach Initiative’, to educate landowners concerning the following:
‘‘(1) The value and benefits of practicing sustainable forestry.
‘‘(2) The importance of professional forestry advice in
achieving sustainable forestry objectives.
‘‘(3) The variety of public and private sector resources available to assist the landowners in planning for and practicing
sustainable forestry.’’.
(b) RENEWABLE RESOURCES EXTENSION ACTIVITIES.—
(1) AUTHORIZATION OF APPROPRIATIONS.—Section 6 of the
Renewable Resources Extension Act of 1978 (16 U.S.C. 1675)

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is amended by striking the first sentence and inserting the
following: ‘‘There is authorized to be appropriated to carry
out this Act $30,000,000 for each of fiscal years 2002 through
2007.’’.
(2) TERMINATION DATE.—Section 8 of the Renewable
Resources Extension Act of 1978 (16 U.S.C. 1671 note; Public
Law 95–306) is amended by striking ‘‘2000’’ and inserting
‘‘2007’’.
SEC. 8102. OFFICE OF INTERNATIONAL FORESTRY.

Section 2405(d) of the Global Climate Change Prevention Act
of 1990 (7 U.S.C. 6704(d)) is amended by striking ‘‘2002’’ and
inserting ‘‘2007’’.

Subtitle C—Miscellaneous Provisions
SEC. 8201. MCINTIRE-STENNIS COOPERATIVE FORESTRY RESEARCH
PROGRAM.

It is the sense of Congress to reaffirm the importance of Public
Law 87–788 (16 U.S.C. 582a et seq.), commonly known as the
‘‘McIntire-Stennis Cooperative Forestry Act’’.

TITLE IX—ENERGY
SEC. 9001. DEFINITIONS.

7 USC 8101.

In this title:
(1) ADMINISTRATOR.—The term ‘‘Administrator’’ means the
Administrator of the Environmental Protection Agency.
(2) BIOBASED PRODUCT.—The term ‘‘biobased product’’
means a product determined by the Secretary to be a commercial or industrial product (other than food or feed) that is
composed, in whole or in significant part, of biological products
or renewable domestic agricultural materials (including plant,
animal, and marine materials) or forestry materials.
(3) BIOMASS.—
(A) IN GENERAL.—The term ‘‘biomass’’ means any
organic material that is available on a renewable or recurring basis.
(B) INCLUSIONS.—The term ‘‘biomass’’ includes—
(i) agricultural crops;
(ii) trees grown for energy production;
(iii) wood waste and wood residues;
(iv) plants (including aquatic plants and grasses);
(v) residues;
(vi) fibers;
(vii) animal wastes and other waste materials; and
(viii) fats, oils, and greases (including recycled fats,
oils, and greases).
(C) EXCLUSIONS.—The term ‘‘biomass’’ does not
include—
(i) paper that is commonly recycled; or
(ii) unsegregated solid waste.
(4) RENEWABLE ENERGY.—The term ‘‘renewable energy’’
means energy derived from—
(A) a wind, solar, biomass, or geothermal source; or

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(B) hydrogen derived from biomass or water using
an energy source described in subparagraph (A).
(5) RURAL SMALL BUSINESS.—The term ‘‘rural small business’’ has the meaning that the Secretary shall prescribe by
regulation.
(6) SECRETARY.—The term ‘‘Secretary’’ means the Secretary
of Agriculture.

7 USC 8102.

SEC. 9002. FEDERAL PROCUREMENT OF BIOBASED PRODUCTS.

(a) APPLICATION OF SECTION.—Except as provided in subsection
(c), each Federal agency shall comply with the requirements set
forth in this section and any regulations issued under this section,
with respect to any purchase or acquisition of a procurement item
where the purchase price of the item exceeds $10,000 or where
the quantity of such items or of functionally equivalent items purchased or acquired in the course of the preceding fiscal year was
$10,000 or more.
(b) PROCUREMENT SUBJECT TO OTHER LAW.—Any procurement,
by any Federal agency, which is subject to regulations of the
Administrator under section 6002 of the Solid Waste Disposal Act
(42 U.S.C. 6962), shall not be subject to the requirements of this
section to the extent that such requirements are inconsistent with
such regulations.
(c) PROCUREMENT PREFERENCE.—(1) Except as provided in paragraph (2), after the date specified in applicable guidelines prepared
pursuant to subsection (e) of this section, each Federal agency
which procures any items designated in such guidelines shall, in
making procurement decisions, give preference to such items composed of the highest percentage of biobased products practicable,
consistent with maintaining a satisfactory level of competition, considering such guidelines.
(2) AGENCY FLEXIBILITY.—Notwithstanding paragraph (1), an
agency may decide not to procure such items if the agency determines that the items—
(A) are not reasonably available within a reasonable period
of time;
(B) fail to meet the performance standards set forth in
the applicable specifications or fail to meet the reasonable
performance standards of the procuring agencies; or
(C) are available only at an unreasonable price.
(3) After the date specified in any applicable guidelines prepared pursuant to subsection (e) of this section, contracting offices
shall require that, with respect to biobased products, vendors certify
that the biobased products to be used in the performance of the
contract will comply with the applicable specifications or other
contractual requirements.
(d) SPECIFICATIONS.—All Federal agencies that have the responsibility for drafting or reviewing specifications for procurement
items procured by Federal agencies shall, within one year after
the date of publication of applicable guidelines under subsection
(e), or as otherwise specified in such guidelines, assure that such
specifications require the use of biobased products consistent with
the requirements of this section.
(e) GUIDELINES.—
(1) IN GENERAL.—The Secretary, after consultation with
the Administrator, the Administrator of General Services, and
the Secretary of Commerce (acting through the Director of

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the National Institute of Standards and Technology), shall prepare, and from time to time revise, guidelines for the use
of procuring agencies in complying with the requirements of
this section. Such guidelines shall—
(A) designate those items which are or can be produced
with biobased products and whose procurement by procuring agencies will carry out the objectives of this section;
(B) set forth recommended practices with respect to
the procurement of biobased products and items containing
such materials and with respect to certification by vendors
of the percentage of biobased products used; and
(C) provide information as to the availability, relative
price, performance, and environmental and public health
benefits, of such materials and items and where appropriate shall recommend the level of biobased material to
be contained in the procured product.
(2) CONSIDERATIONS.—In making the designation under
paragraph (1)(A), the Secretary shall, at a minimum, consider—
(A) the availability of such items; and
(B) the economic and technological feasibility of using
such items, including life cycle costs.
(3) FINAL GUIDELINES.—The Secretary shall prepare final
guidelines under this section within 180 days after the date
of enactment of this Act.
(f) OFFICE OF FEDERAL PROCUREMENT POLICY.—The Office of
Federal Procurement Policy, in cooperation with the Secretary,
shall implement the requirements of this section. It shall be the
responsibility of the Office of Federal Procurement Policy to coordinate this policy with other policies for Federal procurement to
implement the requirements of this section, and, every two years
beginning in 2003, to report to the Congress on actions taken
by Federal agencies and the progress made in the implementation
of this section, including agency compliance with subsection (d).
(g) PROCUREMENT PROGRAM.—(1) Within one year after the
date of publication of applicable guidelines under subsection (e),
each Federal agency shall develop a procurement program which
will assure that items composed of biobased products will be purchased to the maximum extent practicable and which is consistent
with applicable provisions of Federal procurement law.
(2) Each procurement program required under this subsection
shall, at a minimum, contain—
(A) a biobased products preference program;
(B) an agency promotion program to promote the preference
program adopted under subparagraph (A); and
(C) annual review and monitoring of the effectiveness of
an agency’s procurement program.
(3) In developing the preference program, the following options
shall be considered for adoption:
(A) CASE-BY-CASE POLICY DEVELOPMENT.—Subject to the
limitations of subsection (c)(2) (A) through (C), a policy of
awarding contracts to the vendor offering an item composed
of the highest percentage of biobased products practicable. Subject to such limitations, agencies may make an award to a
vendor offering items with less than the maximum biobased
products content.
(B) MINIMUM CONTENT STANDARDS.—Minimum biobased
products content specifications which are set in such a way

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Deadline.

Reports.

Deadline.

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Deadline.

7 USC 8103.

PUBLIC LAW 107–171—MAY 13, 2002

as to assure that the biobased products content required is
consistent with the requirements of this section, without violating the limitations of subsection (c)(2) (A) through (C).
Federal agencies shall adopt one of the options set forth in subparagraphs (A) and (B) or a substantially equivalent alternative, for
inclusion in the procurement program.
(h) LABELING.—
(1) IN GENERAL.—The Secretary, in consultation with the
Administrator, shall establish a voluntary program under which
the Secretary authorizes producers of biobased products to use
the label ‘‘U.S.D.A. Certified Biobased Product’’.
(2) ELIGIBILITY CRITERIA.—Within one year after the date
of enactment of this Act, the Secretary, in consultation with
the Administrator, shall issue criteria for determining which
products may qualify to receive the label under paragraph
(1). The criteria shall encourage the purchase of products with
the maximum biobased content, and should, to the maximum
extent possible, be consistent with the guidelines issued under
subsection (e).
(3) USE OF THE LABEL.—The Secretary shall ensure that
the label referred to in paragraph (1) is used only on products
that meet the criteria issued pursuant to paragraph (2).
(4) RECOGNITION.—The Secretary shall establish a voluntary program to recognize Federal agencies and private entities that use a substantial amount of biobased products.
(i) LIMITATION.—Nothing in this section shall apply to the
procurement of motor vehicle fuels or electricity.
(j) FUNDING.—
(1) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such sums as may be necessary to
carry out this section.
(2) FUNDING FOR TESTING OF BIOBASED PRODUCTS.—
(A) IN GENERAL.—Of the funds of the Commodity
Credit Corporation, the Secretary shall use $1,000,000 for
each of fiscal years 2002 through 2007 to support testing
of biobased products to carry out this section.
(B) USE OF FUNDS.—Amounts made available under
subparagraph (A) may be used to support contracts or
cooperative agreements with entities that have experience
and special skills to conduct such testing.
(C) PRIORITY.—At the discretion of the Secretary, the
Secretary may give priority to the testing of products for
which private sector firms provide cost sharing for the
testing.
SEC. 9003. BIOREFINERY DEVELOPMENT GRANTS.

(a) PURPOSE.—The purpose of this section is to assist in the
development of new and emerging technologies for the use of biomass, including lignocellulosic biomass, so as to—
(1) develop transportation and other fuels, chemicals, and
energy from renewable sources;
(2) increase the energy independence of the United States;
(3) provide beneficial effects on conservation, public health,
and the environment;
(4) diversify markets for raw agricultural and forestry products; and

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(5) create jobs and enhance the economic development of
the rural economy.
(b) DEFINITIONS.—In this section:
(1) ADVISORY COMMITTEE.—The term ‘‘Advisory Committee’’
means the Biomass Research and Development Technical
Advisory Committee established by section 306 of the Biomass
Research and Development Act of 2000 (7 U.S.C. 7624 note;
Public Law 106–224).
(2) BIOREFINERY.—The term ‘‘biorefinery’’ means equipment
and processes that—
(A) convert biomass into fuels and chemicals; and
(B) may produce electricity.
(3) BOARD.—The term ‘‘Board’’ means the Biomass
Research and Development Board established by section 305
of the Biomass Research and Development Act of 2000 (7 U.S.C.
7624 note; Public Law 106–224).
(4) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has the meaning
given the term in section 4 of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450b).
(c) GRANTS.—The Secretary shall award grants to eligible entities to assist in paying the cost of development and construction
of biorefineries to carry out projects to demonstrate the commercial
viability of 1 or more processes for converting biomass to fuels
or chemicals.
(d) ELIGIBLE ENTITIES.—An individual, corporation, farm
cooperative, association of farmers, national laboratory, institution
of higher education (as defined in section 101 of the Higher Education Act of 1965 (20 U.S.C. 1001)), State or local energy agency
or office, Indian tribe, or consortium comprised of any of those
entities shall be eligible to receive a grant under subsection (c).
(e) COMPETITIVE BASIS FOR AWARDS.—
(1) IN GENERAL.—The Secretary shall award grants under
subsection (c) on a competitive basis after consulting the Board
and Advisory Committee.
(2) SELECTION CRITERIA.—
(A) IN GENERAL.—In selecting projects to receive grants
under subsection (c), the Secretary—
(i) shall select projects based on the likelihood
that the projects will demonstrate the commercial
viability of a new and emerging process for converting
biomass into fuels, chemicals, or energy; and
(ii) may consider the likelihood that the projects
will produce electricity.
(B) FACTORS.—The factors to be considered under
subparagraph (A) may include—
(i) the potential market for the product or products;
(ii) the level of financial participation by the
applicants;
(iii) the availability of adequate funding from other
sources;
(iv) the beneficial impact on resource conservation,
public health, and the environment;
(v) the participation of producer associations and
cooperatives;
(vi) the timeframe in which the project will be
operational;
(vii) the potential for rural economic development;

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(viii) the participation of multiple eligible entities;
and

(ix) the potential for developing advanced industrial biotechnology approaches.
(f) COST SHARING.—
(1) IN GENERAL.—The amount of a grant for a project
awarded under subsection (c) shall not exceed 30 percent of
the cost of the project.
(2) FORM OF GRANTEE SHARE.—
(A) IN GENERAL.—The grantee share of the cost of
a project may be made in the form of cash or the provision
of services, material, or other in-kind contributions.
(B) LIMITATION.—The amount of the grantee share of
the cost of a project that is made in the form of the
provision of services, material, or other in-kind contributions shall not exceed 25 percent of the amount of the
grantee share determined under paragraph (1).
(g) CONSULTATION.—In carrying out this section, the Secretary
shall consult with the Secretary of Energy.
(h) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 2002 through 2007.
7 USC 8104.

SEC. 9004. BIODIESEL FUEL EDUCATION PROGRAM.

(a) ESTABLISHMENT.—The Secretary shall, under such terms
and conditions as are appropriate, make competitive grants to
eligible entities to educate governmental and private entities that
operate vehicle fleets, other interested entities (as determined by
the Secretary), and the public about the benefits of biodiesel fuel
use.
(b) ELIGIBLE ENTITIES.—To receive a grant under subsection
(a), an entity—
(1) shall be a nonprofit organization or institution of higher
education (as defined in section 101 of the Higher Education
Act of 1965 (20 U.S.C. 1001));
(2) shall have demonstrated knowledge of biodiesel fuel
production, use, or distribution; and
(3) shall have demonstrated the ability to conduct educational and technical support programs.
(c) CONSULTATION.—In carrying out this section, the Secretary
shall consult with the Secretary of Energy.
(d) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall make available to carry out this section
$1,000,000 for each of fiscal years 2003 through 2007.

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7 USC 8105.

SEC. 9005. ENERGY AUDIT AND RENEWABLE ENERGY DEVELOPMENT
PROGRAM.

Grants.

(a) IN GENERAL.—The Secretary shall make competitive grants
to eligible entities to carry out a program to assist farmers,
ranchers, and rural small businesses in becoming more energy
efficient and in using renewable energy technology and resources.
(b) ELIGIBLE ENTITIES.—Entities eligible to carry out a program
under subsection (a) are—
(1) a State energy or agricultural office;
(2) a regional or State-based energy organization or energy
organization of an Indian tribe (as defined in section 4 of
the Indian Self-Determination and Education Assistance Act
(25 U.S.C. 450b));

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(3) a land-grant college or university (as defined in section
1404 of the National Agricultural Research, Extension, and
Teaching Policy Act of 1977 (7 U.S.C. 3103)) or other institution
of higher education (as defined in section 101 of the Higher
Education Act of 1965 (20 U.S.C. 1001));
(4) a rural electric cooperative or utility;
(5) a nonprofit organization; and
(6) any other entity, as determined by the Secretary.
(c) MERIT REVIEW.—
(1) MERIT REVIEW PROCESS.—The Secretary shall establish
a merit review process to review applications for grants under
subsection (a) that uses the expertise of other Federal agencies,
industry, and nongovernmental organizations.
(2) SELECTION CRITERIA.—In reviewing applications of
eligible entities to receive grants under subsection (a), the
Secretary shall consider—
(A) the ability and expertise of the eligible entity in
providing professional energy audits and renewable energy
assessments;
(B) the geographic scope of the program proposed by
the eligible entity;
(C) the number of farmers, ranchers, and rural small
businesses to be assisted by the program;
(D) the potential for energy savings and environmental
and public health benefits resulting from the program;
and
(E) the plan of the eligible entity for educating farmers,
ranchers, and rural small businesses on the benefits of
energy efficiency and renewable energy development.
(d) USE OF GRANT FUNDS.—
(1) REQUIRED USES.—A recipient of a grant under subsection (a) shall use the grant funds to conduct and promote
energy audits for farmers, ranchers, and rural small businesses
to provide farmers, ranchers, and rural small businesses recommendations on how to improve energy efficiency and use
renewable energy technology and resources.
(2) PERMITTED USES.—In addition to the uses described
in paragraph (1), a recipient of a grant may use the grant
funds to make farmers, ranchers, and rural small businesses
aware of, and ensure that they have access to—
(A) financial assistance under section 9006; and
(B) other Federal, State, and local financial assistance
programs for which farmers, ranchers, and rural small
businesses may be eligible.
(e) COST SHARING.—A recipient of a grant under subsection
(a) that conducts an energy audit for a farmer, rancher, or rural
small business under subsection (d)(1) shall require that, as a
condition of the energy audit, the farmer, rancher, or rural small
business pay at least 25 percent of the cost of the audit.
(f) USE OF COST-SHARE FUNDS.—Funds collected by a recipient
of a grant under subsection (e) as a result of activities carried
out using the grant funds shall be used to conduct activities authorized under this section, as approved by the Secretary.
(g) CONSULTATION.—In carrying out this section, the Secretary
shall consult with the Secretary of Energy.

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Deadline.

(h) REPORTS.—Not later than 4 years after the date of enactment of this Act, the Secretary shall submit to Congress a report
on the implementation of this section.
(i) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 2002 through 2007.

7 USC 8106.

SEC. 9006. RENEWABLE ENERGY SYSTEMS AND ENERGY EFFICIENCY
IMPROVEMENTS.

(a) IN GENERAL.—In addition to exercising authority to make
loans and loan guarantees under other law, the Secretary shall
make loans, loan guarantees, and grants to farmers, ranchers,
and rural small businesses to—
(1) purchase renewable energy systems; and
(2) make energy efficiency improvements.
(b) ELIGIBILITY.—To be eligible to receive a grant under subsection (a), a farmer, rancher, or rural small business shall demonstrate financial need as determined by the Secretary.
(c) COST SHARING.—
(1) IN GENERAL.—
(A) GRANTS.—The amount of a grant shall not exceed
25 percent of the cost of the activity funded under subsection (a).
(B) MAXIMUM AMOUNT OF COMBINED GRANT AND
LOAN.—The combined amount of a grant and loan made
or guaranteed shall not exceed 50 percent of the cost of
the activity funded under subsection (a).
(2) FACTORS.—In determining the amount of a grant or
loan, the Secretary shall take into consideration, as applicable—
(A) the type of renewable energy system to be purchased;
(B) the estimated quantity of energy to be generated
by the renewable energy system;
(C) the expected environmental benefits of the renewable energy system;
(D) the extent to which the renewable energy system
will be replicable;
(E) the amount of energy savings expected to be derived
from the activity, as demonstrated by an energy audit
comparable to an energy audit under section 9005;
(F) the estimated length of time it would take for
the energy savings generated by the activity to equal the
cost of the activity; and
(G) other factors as appropriate.
(d) INTEREST RATE.—
(1) IN GENERAL.—A loan made by the Secretary under
subsection (a) shall bear interest at the rate equivalent to
the rate of interest charged on Treasury securities of comparable maturity on the date the loan is approved.
(2) DURATION.—The interest rate for each loan will remain
in effect for the term of the loan.
(e) CONSULTATION.—In carrying out this section, the Secretary
shall consult with the Secretary of Energy.
(f) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall make available to carry out this section
$23,000,000 for each of fiscal years 2003 through 2007.

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116 STAT. 483

SEC. 9007. HYDROGEN AND FUEL CELL TECHNOLOGIES.

7 USC 8107.

(a) IN GENERAL.—The Secretary and the Secretary of Energy
shall enter into a memorandum of understanding under which
the Secretary and the Secretary of Energy shall cooperate in the
application of hydrogen and fuel cell technology programs for rural
communities and agricultural producers.
(b) DISSEMINATION OF INFORMATION.—Under the memorandum
of understanding, the Secretary shall work with the Secretary of
Energy to disseminate information to rural communities and agricultural producers on potential applications of hydrogen and fuel
cell technologies.

Memorandum.

SEC. 9008. BIOMASS RESEARCH AND DEVELOPMENT.

(a) FUNDING.—The Biomass Research and Development Act
of 2000 (7 U.S.C. 7624 note; Public Law 106–224) is amended—
(1) in section 307, by striking subsection (f);
(2) by redesignating section 310 as section 311; and
(3) by inserting after section 309 the following:

26 USC 7624
note.
26 USC 7624
note.

‘‘SEC. 310. FUNDING.

‘‘(a) FUNDING.—Of funds of the Commodity Credit Corporation,
the Secretary shall make available to carry out this title—
‘‘(1) $5,000,000 for fiscal year 2002; and
‘‘(2) $14,000,000 for each of fiscal years 2003 through 2007;
to remain available until expended.
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—In addition to
amounts transferred under subsection (a), there are authorized
to be appropriated to carry out this title $49,000,000 for each
of fiscal years 2002 through 2007.’’.
(b) TERMINATION OF AUTHORITY.—Section 311 of the Biomass
Research and Development Act of 2000 (7 U.S.C. 7624 note; Public
Law 106–224) (as redesignated by subsection (a)) is amended by
striking ‘‘December 31, 2005’’ and inserting ‘‘September 30, 2007’’.
SEC. 9009. COOPERATIVE RESEARCH AND EXTENSION PROJECTS.

Section 221 of the Agricultural Risk Protection Act of 2000
(114 Stat. 407) is amended—
(1) by redesignating subsection (d) as subsection (f); and
(2) by inserting after subsection (c) the following:
‘‘(d) COOPERATIVE RESEARCH.—
‘‘(1) IN GENERAL.—Subject to the availability of appropriations, the Secretary, in cooperation with departments and agencies participating in the U.S. Global Change Research Program
(which may use any of their statutory authorities) and with
eligible entities, may carry out research to promote understanding of—
‘‘(A) the flux of carbon in soils and plants (including
trees); and
‘‘(B) the exchange of other greenhouse gases from agriculture.
‘‘(2) ELIGIBLE ENTITIES.—Research under this subsection
may be carried out through the competitive awarding of grants
and cooperative agreements to colleges and universities (as
defined in section 1404 of the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 1303)).
‘‘(3) COOPERATIVE RESEARCH PURPOSES.—Research conducted under this subsection shall encourage collaboration
among scientists with expertise in the areas of soil science,

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agronomy, agricultural economics, forestry, and other agricultural sciences to focus on—
‘‘(A) developing data addressing carbon losses and
gains in soils and plants (including trees) and the exchange
of methane and nitrous oxide from agriculture;
‘‘(B) understanding how agricultural and forestry practices affect the sequestration of carbon in soils and plants
(including trees) and the exchange of other greenhouse
gases, including the effects of new technologies such as
biotechnology and nanotechnology;
‘‘(C) developing cost-effective means of measuring and
monitoring changes in carbon pools in soils and plants
(including trees), including computer models;
‘‘(D) evaluating the linkage between federal conservation programs and carbon sequestration;
‘‘(E) developing methods, including remote sensing, to
measure the exchange of carbon and other greenhouse
gases sequestered, and to evaluate leakage, performance,
and permanence issues; and
‘‘(F) assessing the applicability of the results of
research conducted under this subsection for developing
methods to account for the impact of agricultural activities
(including forestry) on the exchange of greenhouse gases.
‘‘(4) AUTHORIZATION OF APPROPRIATION.—There are authorized to be appropriated such sums as are necessary to carry
out this subsection for each of fiscal years 2002 through 2007.
‘‘(e) EXTENSION PROJECTS.—
‘‘(1) IN GENERAL.—The Secretary, in cooperation with
departments and agencies participating in the U.S. Global
Change Research Program (which may use any of their statutory authorities), and local extension agents, experts from
institutions of higher education that offer a curriculum in agricultural and biological sciences, and other local agricultural
or conservation organizations, may implement extension
projects (including on-farm projects with direct involvement
of agricultural producers) that combine measurement tools and
modeling techniques into integrated packages to monitor the
carbon sequestering benefits of conservation practices and the
exchange of greenhouse gas emissions from agriculture which
demonstrate the feasibility of methods of measuring and
monitoring—
‘‘(A) changes in carbon content and other carbon pools
in soils and plants (including trees); and
‘‘(B) the exchange of other greenhouse gases.
‘‘(2) EXTENSION PROJECT RESULTS.—The Secretary may
disseminate to farmers, ranchers, private forest landowners,
and appropriate State agencies in each State information
concerning—
‘‘(A) the results of projects under this subsection; and
‘‘(B) the manner in which the methods used in the
projects might be applicable to the operations of the
farmers, ranchers, private forest landowners, and State
agencies.
‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—There are
authorized to be appropriated such sums as are necessary to
carry out this subsection for each of fiscal years 2002 through
2007.’’.

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SEC. 9010. CONTINUATION OF BIOENERGY PROGRAM.

7 USC 8108.

(a) DEFINITIONS.—In this section:
(1) BIOENERGY.—The term ‘‘bioenergy’’ means—
(A) biodiesel; and
(B) fuel grade ethanol.
(2) BIODIESEL.—The term ‘‘biodiesel’’ means a monoalkyl
ester that meets the requirements of an appropriate American
Society for Testing and Materials standard.
(3) ELIGIBLE COMMODITY.—The term ‘‘eligible commodity’’
means—
(A) wheat, corn, grain sorghum, barley, oats, rice, soybeans, sunflower seed, rapeseed, canola, safflower, flaxseed,
mustard, crambe, sesame seed, and cottonseed;
(B) a cellulosic commodity (such as hybrid poplar and
switch grass);
(C) fats, oils, and greases (including recycled fats, oils,
and greases) derived from an agricultural product; and
(D) any animal byproduct (in addition to oils, fats,
and greases) that may be used to produce bioenergy, as
determined by the Secretary.
(4) ELIGIBLE PRODUCER.—The term ‘‘eligible producer’’
means a producer that uses an eligible commodity to produce
bioenergy.
(b) BIOENERGY PROGRAM.—
(1) CONTINUATION.—The Secretary shall continue the program under part 1424 of title 7, Code of Federal Regulations
(or any successor regulation), under which the Secretary makes
payments to eligible producers to encourage increased purchases of eligible commodities for the purpose of expanding
production of such bioenergy and supporting new production
capacity for such bioenergy.
(2) CONTRACTS.—To be eligible to receive a payment, an
eligible producer shall—
(A) enter into a contract with the Secretary to increase
bioenergy production for 1 or more fiscal years; and
(B) submit to the Secretary such records as the Secretary may require as evidence of increased purchase and
use of eligible commodities for the production of bioenergy.
(3) PAYMENT.—
(A) IN GENERAL.—Under the program, the Secretary
shall make payments to eligible producers, based on the
quantity of bioenergy produced by the eligible producer
during a fiscal year that exceeds the quantity of bioenergy
produced by the eligible producer during the preceding
fiscal year.
(B) PAYMENT RATE.—
(i) PRODUCERS OF LESS THAN 65,000,000 GALLONS.—
An eligible producer that produces less than 65,000,000
gallons of bioenergy shall be reimbursed 1 feedstock
unit for every 2.5 feedstock units of eligible commodity
used for increased production.
(ii) PRODUCERS OF 65,000,000 OR MORE GALLONS.—
An eligible producer that produces 65,000,000 or more
gallons of bioenergy shall be reimbursed 1 feedstock
unit for every 3.5 feedstock units of eligible commodity
used for increased production.

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(C) QUARTERLY PAYMENTS.—The Secretary shall make
payments to an eligible producer for each quarter of the
fiscal year.
(4) PRORATION.—If the amount made available for a fiscal
year under subsection (c) is insufficient to allow the payment
of the amount of the payments that eligible producers (that
apply for the payments) otherwise would receive under this
subsection, the Secretary shall prorate the amount of the funds
among all such eligible producers.
(5) OVERPAYMENTS.—If the total amount of payments that
an eligible producer receives for a fiscal year under this section
exceeds the amount that the eligible producer should have
received under this subsection, the eligible producer shall repay
the amount of the overpayment to the Secretary, with interest
(as determined by the Secretary).
(6) LIMITATION.—No eligible producer shall receive more
than 5 percent of the total amount made available under subsection (c) for a fiscal year.
(7) OTHER REQUIREMENTS.—To be eligible to receive a payment under this subsection, an eligible producer shall meet
other requirements of Federal law (including regulations)
applicable to the production of bioenergy.
(c) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall use to carry out this section—
(1) not more than $150,000,000 for each of fiscal years
2003 through 2006; and
(2) $0 for fiscal year 2007.

TITLE X—MISCELLANEOUS
Subtitle A—Crop Insurance
SEC. 10001. EQUAL CROP INSURANCE TREATMENT OF POTATOES AND
SWEET POTATOES.

Section 508(a)(2) of the Federal Crop Insurance Act (7 U.S.C.
1508(a)(2)) is amended in the first sentence by striking ‘‘and potatoes’’ and inserting ‘‘, potatoes, and sweet potatoes’’.
SEC. 10002. CONTINUOUS COVERAGE.

Section 508(e)(4) of the Federal Crop Insurance Act (7 U.S.C.
1508(e)(4)) is amended—
(1) in the paragraph heading, by striking ‘‘TEMPORARY
PROHIBITION’’ and inserting ‘‘PROHIBITION’’; and
(2) by striking ‘‘through 2005’’ and inserting ‘‘and subsequent’’.
SEC. 10003. QUALITY LOSS ADJUSTMENT PROCEDURES.

Effective date.

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Section 508(m) of the Federal Crop Insurance Act (7 U.S.C.
1508(m)) is amended—
(1) in paragraph (3)—
(A) by striking ‘‘The Corporation’’ and inserting the
following:
‘‘(A) REVIEW.—The Corporation’’; and
(B) by striking ‘‘Based on’’ and inserting the following:
‘‘(B) PROCEDURES.—Effective beginning not later than
the 2004 reinsurance year, based on’’; and

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116 STAT. 487

(2) by adding at the end the following:
‘‘(4) QUALITY OF AGRICULTURAL COMMODITIES DELIVERED
TO WAREHOUSE OPERATORS.—In administering this title, the
Secretary shall accept, in the same manner and under the
same terms and conditions, evidence of the quality of agricultural commodities delivered to—
‘‘(A) warehouse operators that are licensed under the
United States Warehouse Act (7 U.S.C. 241 et seq.);
‘‘(B) warehouse operators that—
‘‘(i) are licensed under State law; and
‘‘(ii) have entered into a storage agreement with
the Commodity Credit Corporation; and
‘‘(C) warehouse operators that—
‘‘(i) are not licensed under State law but are in
compliance with State law regarding warehouses; and
‘‘(ii) have entered into a commodity storage agreement with the Commodity Credit Corporation.’’.
SEC. 10004. ADJUSTED GROSS REVENUE INSURANCE PILOT PROGRAM.

Section 523 of the Federal Crop Insurance Act (7 U.S.C. 1523)
is amended by adding at the end the following:
‘‘(e) ADJUSTED GROSS REVENUE INSURANCE PILOT PROGRAM.—
‘‘(1) IN GENERAL.—The Corporation shall carry out, through
at least the 2004 reinsurance year, the adjusted gross revenue
insurance pilot program in effect for the 2002 reinsurance year.
‘‘(2) ADDITIONAL COUNTIES.—
‘‘(A) IN GENERAL.—In addition to counties otherwise
included in the pilot program, the Corporation shall include
in the pilot program for the 2003 reinsurance year at
least 8 counties in the State of California and at least
8 counties in the State of Pennsylvania.
‘‘(B) SELECTION CRITERIA.—In carrying out subparagraph (A), the Corporation shall work with the respective
State Departments of Agriculture to establish criteria to
determine which counties to include in the pilot program.’’.
SEC. 10005. SENSE OF CONGRESS ON EXPANSION OF CROP INSURANCE
COVERAGE.

It is the sense of Congress that the Federal Crop Insurance
Corporation should address needs of producers through the expansion of pilot programs and coverage under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.), including—
(1) crop revenue insurance for the producers of pecans
in the State of Georgia; and
(2) coverage for continuous crops of wheat produced in
the State of Kansas.
SEC. 10006. REPORT ON SPECIALTY CROP INSURANCE.

Not later than 180 days after the date of enactment of this
Act, the Secretary of Agriculture shall submit to the Committee
on Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a report
that describes—
(1) the progress made by the Federal Crop Insurance Corporation in research and development of innovative risk
management products to include cost of production insurance

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that provides coverage for specialty crops, paying special attention to apples, asparagus, blueberries (wild and domestic), cabbage, canola, carrots, cherries, Christmas trees, citrus fruits,
cucumbers, dry beans, eggplants, floriculture, grapes, greenhouse and nursery agricultural commodities, green peas, green
peppers, hay, lettuce, maple, mushrooms, pears, potatoes,
pumpkins, snap beans, spinach, squash, strawberries, sugar
beets, and tomatoes; and
(2) the progress made by the Corporation in increasing
the use of risk management products offered through the Corporation by producers of specialty crops, by small- and moderate-sized farms, and in areas that are underserved, as determined by the Secretary.

Subtitle B—Disaster Assistance
SEC. 10101. REFERENCE TO SEA GRASS AND SEA OATS AS CROPS COVERED BY NONINSURED CROP DISASTER ASSISTANCE
PROGRAM.

Section 196(a)(2)(B) of the Federal Agriculture Improvement
and Reform Act of 1996 (7 U.S.C. 7333(a)(2)(B)) is amended by
inserting ‘‘sea grass and sea oats,’’ after ‘‘fish),’’.
SEC. 10102. EMERGENCY GRANTS TO ASSIST LOW-INCOME MIGRANT
AND SEASONAL FARMWORKERS.

Section 2281(a) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (42 U.S.C. 5177a(a)) is amended by striking
‘‘, not to exceed $20,000,000 annually,’’.
SEC. 10103. EMERGENCY LOANS FOR SEED PRODUCERS.

Section 253(b)(5)(B) of the Agricultural Risk Protection Act
of 2000 (Public Law 106–224; 114 Stat. 423) is amended by striking
‘‘18 months’’ and inserting ‘‘36 months’’.
7 USC 1472.

SEC. 10104. ASSISTANCE FOR LIVESTOCK PRODUCERS.

(a) AVAILABILITY OF ASSISTANCE.—In such amounts as are provided in advance in appropriation Acts, the Secretary of Agriculture
may provide assistance to dairy and other livestock producers to
cover economic losses incurred by such producers in connection
with the production of livestock.
(b) TYPES OF ASSISTANCE.—The assistance provided to livestock
producers may be in the following forms:
(1) Indemnity payments to livestock producers who incur
livestock mortality losses.
(2) Livestock feed assistance to livestock producers affected
by shortages of feed.
(3) Compensation for sudden increases in production costs.
(4) Such other assistance, and for such other economic
losses, as the Secretary considers appropriate.
(c) LIMITATIONS.—The Secretary may not use the funds of the
Commodity Credit Corporation to provide assistance under this
section.
(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to the Secretary such sums as may be necessary
to carry out this section.

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SEC. 10105. MARKET LOSS ASSISTANCE FOR APPLE PRODUCERS.

(a) IN GENERAL.—Of the funds of the Commodity Credit Corporation, the Secretary of Agriculture shall use $94,000,000 for
fiscal year 2002 to make payments, as soon as practicable after
the date of enactment of this Act, to apple producers for the loss
of markets during the 2000 crop year.
(b) PAYMENT QUANTITY.—The payment quantity of apples for
which the producers on a farm are eligible for payments under
this section shall be equal to the lesser of—
(1) the quantity of the 2000 crop of apples produced by
the producers on the farm; or
(2) 5,000,000 pounds of apples produced on the farm.
(c) LIMITATIONS.—Subject to subsection (b)(2), the Secretary
shall not establish a payment limitation, or income eligibility limitation, with respect to payments made under this section.
(d) REGULATIONS.—
(1) IN GENERAL.—The Secretary shall promulgate such
regulations as are necessary to implement this section.
(2) PROCEDURE.—The promulgation of the regulations and
administration of this section shall be made without regard
to—
(A) the notice and comment provisions of section 553
of title 5, United States Code;
(B) the Statement of Policy of the Secretary of Agriculture effective July 24, 1971 (36 Fed. Reg. 13804),
relating to notices of proposed rulemaking and public
participation in rulemaking; and
(C) chapter 35 of title 44, United States Code (commonly known as the ‘‘Paperwork Reduction Act’’).
(3) CONGRESSIONAL REVIEW OF AGENCY RULEMAKING.—In
carrying out this subsection, the Secretary shall use the
authority provided under section 808 of title 5, United States
Code.
SEC. 10106. MARKET LOSS ASSISTANCE FOR ONION PRODUCERS.

The Secretary of Agriculture shall use $10,000,000 of the funds
of the Commodity Credit Corporation to make a grant to the State
of New York to be used to support onion producers in Orange
County, New York, that have suffered losses to onion crops during
1 or more of the 1996 through 2000 crop years.
SEC. 10107. COMMERCIAL FISHERIES FAILURE.

(a) IN GENERAL.—The Secretary of Agriculture, in consultation
with the Secretary of Commerce, shall provide emergency disaster
assistance for the commercial fishery failure under section 308(b)(1)
of the Interjurisdictional Fisheries Act of 1986 (16 U.S.C. 4107(b)(1))
with respect to Northeast multispecies fisheries.
(b) PROGRAM REQUIREMENTS.—Amounts made available to
carry out this section shall be used to support a voluntary fishing
capacity reduction program in the Northeast multispecies fishery
that—
(1) is certified by the Secretary of Commerce to be consistent with section 312(b) of the Magnuson-Stevens Fishery
Conservation and Management Act (16 U.S.C. 1861a(b)); and
(2) permanently revokes multispecies limited access fishing
permits so as to obtain the maximum sustained reduction in
fishing capacity at the least cost and in the minimum period

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Grants.
New York.

Disaster
assistance.

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of time and to prevent the replacement of fishing capacity
removed by the program.
(c) APPLICATION OF REGULATIONS.—The program shall be carried out in accordance with the regulations codified at part 648
of title 50, Code of Federal Regulations, and any corresponding
rule issued in accordance with the regulations.
(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary to carry out this
section.
(e) TERMINATION OF AUTHORITY.—The authority provided under
this section terminates on the date that is 1 year after the date
of enactment of this Act.
SEC. 10108. STUDY OF FEASIBILITY OF PRODUCER INDEMNIFICATION
FROM GOVERNMENT-CAUSED DISASTERS.

Deadline.

(a) FINDINGS.—Congress finds that the implementation of Federal disaster assistance programs fails to adequately address situations in which disaster conditions are caused primarily by Federal
action.
(b) AUTHORITY.—The Secretary of Agriculture shall conduct
a study of the feasibility of expanding eligibility for crop insurance
under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.),
and noninsured crop assistance under section 196 of the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333),
to agricultural producers experiencing disaster conditions caused
primarily by Federal agency action restricting access to irrigation
water, including any lack of access to an adequate supply of water
caused by failure by the Secretary of the Interior to fulfill a contract
in accordance with the Central Valley Project Improvement Act
(106 Stat. 4706).
(c) REPORT.—Not later than 150 days after the date of enactment of this Act, the Secretary shall submit to the Committee
on Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a report
that describes the results of the study, including any recommendations.

Subtitle C—Tree Assistance Program
7 USC 8201.

SEC. 10201. DEFINITIONS.

In this subtitle:
(1) ELIGIBLE ORCHARDIST.—The term ‘‘eligible orchardist’’
means a person that produces annual crops from trees for
commercial purposes.
(2) NATURAL DISASTER.—The term ‘‘natural disaster’’ means
plant disease, insect infestation, drought, fire, freeze, flood,
earthquake, lightning, and other occurrence, as determined by
the Secretary.
(3) SECRETARY.—The term ‘‘Secretary’’ means the Secretary
of Agriculture.
(4) TREE.—The term ‘‘tree’’ includes a tree, bush, and vine.
7 USC 8202.

SEC. 10202. ELIGIBILITY.

(a) LOSS.—Subject to subsection (b), the Secretary shall provide
assistance under section 10203 to eligible orchardists that planted
trees for commercial purposes but lost the trees as a result of
a natural disaster, as determined by the Secretary.

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(b) LIMITATION.—An eligible orchardist shall qualify for assistance under subsection (a) only if the tree mortality of the eligible
orchardist, as a result of damaging weather or related condition,
exceeds 15 percent (adjusted for normal mortality).
SEC. 10203. ASSISTANCE.

7 USC 8203.

Subject to section 10204, the assistance provided by the Secretary to eligible orchardists for losses described in section 10202
shall consist of—
(1) reimbursement of 75 percent of the cost of replanting
trees lost due to a natural disaster, as determined by the
Secretary, in excess of 15 percent mortality (adjusted for normal
mortality); or
(2) at the option of the Secretary, sufficient seedlings to
reestablish a stand.
SEC. 10204. LIMITATIONS ON ASSISTANCE.

7 USC 8204.

(a) AMOUNT.—The total amount of payments that a person
shall be entitled to receive under this subtitle may not exceed
$75,000, or an equivalent value in tree seedlings.
(b) ACRES.—The total quantity of acres planted to trees or
tree seedlings for which a person shall be entitled to receive payments under this subtitle may not exceed 500 acres.
(c)
REGULATIONS.—The
Secretary
shall
promulgate
regulations—
(1) defining the term ‘‘person’’ for the purposes of this
subtitle, which shall conform, to the maximum extent practicable, to the regulations defining the term ‘‘person’’ promulgated under section 1001 of the Food Security Act of 1985
(7 U.S.C. 1308); and
(2) promulgating such regulations as the Secretary determines necessary to ensure a fair and reasonable application
of the limitation established under this section.
SEC. 10205. AUTHORIZATION OF APPROPRIATIONS.

7 USC 8205.

There are authorized to be appropriated such sums as are
necessary to carry out this subtitle.

Subtitle D—Animal Welfare
SEC. 10301. DEFINITION OF ANIMAL UNDER THE ANIMAL WELFARE
ACT.

Section 2(g) of the Animal Welfare Act (7 U.S.C. 2132(g)) is
amended in the first sentence by striking ‘‘excludes horses not
used for research purposes and’’ and inserting the following:
‘‘excludes (1) birds, rats of the genus Rattus, and mice of the
genus Mus, bred for use in research, (2) horses not used for research
purposes, and (3)’’.
SEC. 10302. PROHIBITION ON INTERSTATE MOVEMENT OF ANIMALS
FOR ANIMAL FIGHTING.

(a) IN GENERAL.—Section 26 of the Animal Welfare Act (7
U.S.C. 2156) is amended—
(1) by striking subsection (a) and inserting the following:
‘‘(a) SPONSORING OR EXHIBITING AN ANIMAL IN AN ANIMAL
FIGHTING VENTURE.—

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7 USC 2156 note.

PUBLIC LAW 107–171—MAY 13, 2002

‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
it shall be unlawful for any person to knowingly sponsor or
exhibit an animal in an animal fighting venture, if any animal
in the venture was moved in interstate or foreign commerce.
‘‘(2) SPECIAL RULE FOR CERTAIN STATES.—With respect to
fighting ventures involving live birds in a State where it would
not be in violation of the law, it shall be unlawful under
this subsection for a person to sponsor or exhibit a bird in
the fighting venture only if the person knew that any bird
in the fighting venture was knowingly bought, sold, delivered,
transported, or received in interstate or foreign commerce for
the purpose of participation in the fighting venture.’’;
(2) in subsection (b), by striking ‘‘or deliver to another
person or receive from another person’’ and inserting ‘‘deliver,
or receive’’; and
(3) in subsection (d), by striking ‘‘subsections (a), (b), or
(c) of this section’’ and inserting ‘‘subsection (c)’’.
(b) EFFECTIVE DATE.—The amendments made by this section
take effect 1 year after the date of enactment of this Act.
SEC. 10303. PENALTIES AND FOREIGN COMMERCE PROVISIONS OF THE
ANIMAL WELFARE ACT.

7 USC 2156 note.

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(a) IN GENERAL.—Section 26 of the Animal Welfare Act (7
U.S.C. 2156) is amended—
(1) in subsection (e)—
(A) by inserting ‘‘PENALTIES.—’’ after ‘‘(e)’’; and
(B) by striking ‘‘$5,000’’ and inserting ‘‘$15,000’’; and
(2) in subsection (g)(2)(B), by inserting before the semicolon
at the end the following: ‘‘or from any State into any foreign
country’’.
(b) EFFECTIVE DATE.—The amendment made by this section
takes effect 1 year after the date of enactment of this Act.

7 USC 2132 note.

SEC. 10304. REPORT ON RATS, MICE, AND BIRDS.

Deadline.

(a) IN GENERAL.—Not later than 1 year after the date of enactment of this Act, the National Research Council shall submit to
the Committee on Agriculture of the House of Representatives
and the Committee on Agriculture, Nutrition, and Forestry of the
Senate, a report on the implications of including rats, mice, and
birds within the definition of animal under the regulations promulgated under the Animal Welfare Act (7 U.S.C. 2131 et seq.).
(b) REQUIREMENTS.—The report under subsection (a) shall—
(1) be completed with input, consultation, and recommendations from—
(A) the Secretary of Agriculture;
(B) the Secretary of Health and Human Services; and
(C) the Institute for Animal Laboratory Research
within the National Academy of Sciences;
(2) contain an estimate of—
(A) the number and types of entities that use rats,
mice, and birds for research purposes; and
(B) which of the entities—
(i) are subject to regulations of the Department
of Agriculture;
(ii) are subject to regulations or guidelines of the
Department of Health and Human Services; or

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(iii) voluntarily comply with the accreditation
requirements of the Association for Assessment and
Accreditation of Laboratory Animal Care;
(3) contain an estimate of the numbers of rats, mice, and
birds used in research facilities, with an indication of which
of the facilities—
(A) are subject to regulations of the Department of
Agriculture;
(B) are subject to regulations or guidelines of the
Department of Health and Human Services; or
(C) voluntarily comply with the accreditation requirements of the Association for Assessment and Accreditation
of Laboratory Animal Care;
(4) contain an estimate of the additional costs likely to
be incurred by breeders and research facilities resulting from
the additional regulatory requirements needed in order to afford
the same level of protection to rats, mice, and birds as is
provided for species regulated by the Department of Agriculture, detailing the costs associated with individual regulatory
requirements;
(5) contain recommendations for minimizing such costs,
including—
(A) an estimate of the cost savings that would result
from providing a different level of protection to rats, mice,
and birds than is provided for species regulated by the
Department of Agriculture; and
(B) an estimate of the cost savings that would result
if new regulatory requirements were substantially equivalent to, and harmonized with, guidelines of the National
Institutes of Health;
(6) contain an estimate of the additional funding that the
Animal and Plant Health Inspection Service would require
to be able to ensure that the level of compliance with respect
to other regulated animals is not diminished by the increase
in the number of facilities that would require inspections if
a rule extending the regulatory definition of animal to rats,
mice, and birds were to become effective; and
(7) contain recommendations for—
(A) minimizing the regulatory burden on facilities subject to—
(i) regulations of the Department of Agriculture;
(ii) regulations or guidelines of the Department
of Health and Human Services; or
(iii) accreditation requirements of the Association
for Assessment and Accreditation of Laboratory Animal
Care; and
(B) preventing any duplication of regulatory requirements.
SEC. 10305. ENFORCEMENT OF HUMANE METHODS OF SLAUGHTER
ACT OF 1958.

7 USC 1901 note.

(a) SENSE OF CONGRESS.—It is the sense of Congress that
the Secretary of Agriculture should—
(1) continue tracking the number of violations of Public
Law 85–765 (7 U.S.C. 1901 et seq.; commonly known as the
‘‘Humane Methods of Slaughter Act of 1958’’) and report the
results and relevant trends annually to Congress; and

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(2) fully enforce Public Law 85–765 by ensuring that
humane methods in the slaughter of livestock—
(A) prevent needless suffering;
(B) result in safer and better working conditions for
persons engaged in slaughtering operations;
(C) bring about improvement of products and economies in slaughtering operations; and
(D) produce other benefits for producers, processors,
and consumers that tend to expedite an orderly flow of
livestock and livestock products in interstate and foreign
commerce.
(b) UNITED STATES POLICY.—It is the policy of the United
States that the slaughtering of livestock and the handling of livestock in connection with slaughter shall be carried out only by
humane methods, as provided by Public Law 85–765.

Subtitle E—Animal Health Protection

Animal Health
Protection Act.
7 USC 8301 note.

SEC. 10401. SHORT TITLE.

This subtitle may be cited as the ‘‘Animal Health Protection
Act’’.
7 USC 8301.

SEC. 10402. FINDINGS.

Congress finds that—
(1) the prevention, detection, control, and eradication of
diseases and pests of animals are essential to protect—
(A) animal health;
(B) the health and welfare of the people of the United
States;
(C) the economic interests of the livestock and related
industries of the United States;
(D) the environment of the United States; and
(E) interstate commerce and foreign commerce of the
United States in animals and other articles;
(2) animal diseases and pests are primarily transmitted
by animals and articles regulated under this subtitle;
(3) the health of animals is affected by the methods by
which animals and articles are transported in interstate commerce and foreign commerce;
(4) the Secretary must continue to conduct research on
animal diseases and pests that constitute a threat to the livestock of the United States; and
(5)(A) all animals and articles regulated under this subtitle
are in or affect interstate commerce or foreign commerce; and
(B) regulation by the Secretary and cooperation by the
Secretary with foreign countries, States or other jurisdictions,
or persons are necessary—
(i) to prevent and eliminate burdens on interstate commerce and foreign commerce;
(ii) to regulate effectively interstate commerce and foreign commerce; and
(iii) to protect the agriculture, environment, economy,
and health and welfare of the people of the United States.
7 USC 8302.

SEC. 10403. DEFINITIONS.

In this subtitle:

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(1) ANIMAL.—The term ‘‘animal’’ means any member of
the animal kingdom (except a human).
(2) ARTICLE.—The term ‘‘article’’ means any pest or disease
or any material or tangible object that could harbor a pest
or disease.
(3) DISEASE.—The term ‘‘disease’’ has the meaning given
the term by the Secretary.
(4) ENTER.—The term ‘‘enter’’ means to move into the commerce of the United States.
(5) EXPORT.—The term ‘‘export’’ means to move from a
place within the territorial limits of the United States to a
place outside the territorial limits of the United States.
(6) FACILITY.—The term ‘‘facility’’ means any structure.
(7) IMPORT.—The term ‘‘import’’ means to move from a
place outside the territorial limits of the United States to
a place within the territorial limits of the United States.
(8) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has the meaning
given the term in section 4 of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450b).
(9) INTERSTATE COMMERCE.—The term ‘‘interstate commerce’’ means trade, traffic, or other commerce—
(A) between a place in a State and a place in another
State, or between places within the same State but through
any place outside that State; or
(B) within the District of Columbia or any territory
or possession of the United States.
(10) LIVESTOCK.—The term ‘‘livestock’’ means all farmraised animals.
(11) MEANS OF CONVEYANCE.—The term ‘‘means of conveyance’’ means any personal property used for or intended for
use for the movement of any other personal property.
(12) MOVE.—The term ‘‘move’’ means—
(A) to carry, enter, import, mail, ship, or transport;
(B) to aid, abet, cause, or induce carrying, entering,
importing, mailing, shipping, or transporting;
(C) to offer to carry, enter, import, mail, ship, or transport;
(D) to receive in order to carry, enter, import, mail,
ship, or transport;
(E) to release into the environment; or
(F) to allow any of the activities described in this
paragraph.
(13) PEST.—The term ‘‘pest’’ means any of the following
that can directly or indirectly injure, cause damage to, or cause
disease in livestock:
(A) A protozoan.
(B) A plant.
(C) A bacteria.
(D) A fungus.
(E) A virus or viroid.
(F) An infectious agent or other pathogen.
(G) An arthropod.
(H) A parasite.
(I) A prion.
(J) A vector.
(K) Any organism similar to or allied with any of
the organisms described in this paragraph.

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PUBLIC LAW 107–171—MAY 13, 2002
(14) SECRETARY.—The term ‘‘Secretary’’ means the Secretary of Agriculture.
(15) STATE.—The term ‘‘State’’ means any of the States,
the District of Columbia, the Commonwealth of Puerto Rico,
Guam, the Commonwealth of the Northern Mariana Islands,
the Virgin Islands of the United States, or any territory or
possession of the United States.
(16) THIS SUBTITLE.—Except when used in this section,
the term ‘‘this subtitle’’ includes any regulation or order issued
by the Secretary under the authority of this subtitle.
(17) UNITED STATES.—The term ‘‘United States’’ means all
of the States.

7 USC 8303.

SEC. 10404. RESTRICTION ON IMPORTATION OR ENTRY.

(a) IN GENERAL.—With notice to the Secretary of the Treasury
and public notice as soon as practicable, the Secretary may prohibit
or restrict—
(1) the importation or entry of any animal, article, or
means of conveyance, or use of any means of conveyance or
facility, if the Secretary determines that the prohibition or
restriction is necessary to prevent the introduction into or
dissemination within the United States of any pest or disease
of livestock;
(2) the further movement of any animal that has strayed
into the United States if the Secretary determines that the
prohibition or restriction is necessary to prevent the introduction into or dissemination within the United States of any
pest or disease of livestock; and
(3) the use of any means of conveyance in connection with
the importation or entry of livestock if the Secretary determines
that the prohibition or restriction is necessary because the
means of conveyance has not been maintained in a clean and
sanitary condition or does not have accommodations for the
safe and proper movement of livestock.
(b) REGULATIONS.—
(1) RESTRICTIONS ON IMPORT AND ENTRY.—The Secretary
may issue such orders and promulgate such regulations as
are necessary to carry out subsection (a).
(2) POST IMPORTATION QUARANTINE.—The Secretary may
promulgate regulations requiring that any animal imported
or entered be raised or handled under post-importation quarantine conditions by or under the supervision of the Secretary
for the purpose of determining whether the animal is or may
be affected by any pest or disease of livestock.
(c) DESTRUCTION OR REMOVAL.—
(1) IN GENERAL.—The Secretary may order the destruction
or removal from the United States of—
(A) any animal, article, or means of conveyance that
has been imported but has not entered the United States
if the Secretary determines that destruction or removal
from the United States is necessary to prevent the introduction into or dissemination within the United States of
any pest or disease of livestock;
(B) any animal or progeny of any animal, article, or
means of conveyance that has been imported or entered
in violation of this subtitle; or

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(C) any animal that has strayed into the United States
if the Secretary determines that destruction or removal
from the United States is necessary to prevent the introduction into or dissemination within the United States of
any pest or disease of livestock.
(2) REQUIREMENTS OF OWNERS.—
(A) ORDERS TO DISINFECT.—The Secretary may require
the disinfection of—
(i) a means of conveyance used in connection with
the importation of an animal;
(ii) an individual involved in the importation of
an animal and personal articles of the individual; and
(iii) any article used in the importation of an
animal.
(B) FAILURE TO COMPLY WITH ORDERS.—If an owner
fails to comply with an order of the Secretary under this
section, the Secretary may—
(i) take remedial action, destroy, or remove from
the United States the animal or progeny of any animal,
article, or means of conveyance as authorized under
paragraph (1); and
(ii) recover from the owner the costs of any care,
handling, disposal, or other action incurred by the
Secretary in connection with the remedial action,
destruction, or removal.
SEC. 10405. EXPORTATION.

7 USC 8304.

(a) IN GENERAL.—The Secretary may prohibit or restrict—
(1) the exportation of any animal, article, or means of
conveyance if the Secretary determines that the prohibition
or restriction is necessary to prevent the dissemination from
or within the United States of any pest or disease of livestock;
(2) the exportation of any livestock if the Secretary determines that the livestock is unfit to be moved;
(3) the use of any means of conveyance or facility in connection with the exportation of any animal or article if the Secretary determines that the prohibition or restriction is necessary to prevent the dissemination from or within the United
States of any pest or disease of livestock; or
(4) the use of any means of conveyance in connection with
the exportation of livestock if the Secretary determines that
the prohibition or restriction is necessary because the means
of conveyance has not been maintained in a clean and sanitary
condition or does not have accommodations for the safe and
proper movement and humane treatment of livestock.
(b) REQUIREMENTS OF OWNERS.—
(1) ORDERS TO DISINFECT.—The Secretary may require the
disinfection of—
(A) a means of conveyance used in connection with
the exportation of an animal;
(B) an individual involved in the exportation of an
animal and personal articles of the individual; and
(C) any article used in the exportation of an animal.
(2) FAILURE TO COMPLY WITH ORDERS.—If an owner fails
to comply with an order of the Secretary under this section,
the Secretary may—

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(A) take remedial action with respect to the animal,
article, or means of conveyance referred to in paragraph
(1); and
(B) recover from the owner the costs of any care, handling, disposal, or other action incurred by the Secretary
in connection with the remedial action.
(c) CERTIFICATION.—The Secretary may certify the classification, quality, quantity, condition, processing, handling, or storage
of any animal or article intended for export.
7 USC 8305.

SEC. 10406. INTERSTATE MOVEMENT.

The Secretary may prohibit or restrict—
(1) the movement in interstate commerce of any animal,
article, or means of conveyance if the Secretary determines
that the prohibition or restriction is necessary to prevent the
introduction or dissemination of any pest or disease of livestock;
and
(2) the use of any means of conveyance or facility in connection with the movement in interstate commerce of any animal
or article if the Secretary determines that the prohibition or
restriction is necessary to prevent the introduction or dissemination of any pest or disease of livestock.
7 USC 8306.

SEC. 10407. SEIZURE, QUARANTINE, AND DISPOSAL.

(a) IN GENERAL.—The Secretary may hold, seize, quarantine,
treat, destroy, dispose of, or take other remedial action with respect
to—
(1) any animal or progeny of any animal, article, or means
of conveyance that—
(A) is moving or has been moved in interstate commerce or has been imported and entered; and
(B) the Secretary has reason to believe may carry,
may have carried, or may have been affected with or
exposed to any pest or disease of livestock at the time
of movement or that is otherwise in violation of this subtitle;
(2) any animal or progeny of any animal, article, or means
of conveyance that is moving or is being handled, or has moved
or has been handled, in interstate commerce in violation of
this subtitle;
(3) any animal or progeny of any animal, article, or means
of conveyance that has been imported, and is moving or is
being handled or has moved or has been handled, in violation
of this subtitle; or
(4) any animal or progeny of any animal, article, or means
of conveyance that the Secretary finds is not being maintained,
or has not been maintained, in accordance with any postimportation quarantine, post-importation condition, post-movement quarantine, or post-movement condition in accordance
with this subtitle.
(b) EXTRAORDINARY EMERGENCIES.—
(1) IN GENERAL.—Subject to paragraph (2), if the Secretary
determines that an extraordinary emergency exists because
of the presence in the United States of a pest or disease
of livestock and that the presence of the pest or disease
threatens the livestock of the United States, the Secretary
may—

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(A) hold, seize, treat, apply other remedial actions to,
destroy (including preventative slaughter), or otherwise dispose of, any animal, article, facility, or means of conveyance
if the Secretary determines the action is necessary to prevent the dissemination of the pest or disease; and
(B) prohibit or restrict the movement or use within
a State, or any portion of a State of any animal or article,
means of conveyance, or facility if the Secretary determines
that the prohibition or restriction is necessary to prevent
the dissemination of the pest or disease.
(2) STATE ACTION.—
(A) IN GENERAL.—The Secretary may take action in
a State under this subsection only on finding that measures
being taken by the State are inadequate to control or
eradicate the pest or disease, after review and consultation
with—
‘‘(i) the Governor or an appropriate animal health
official of the State; or
‘‘(ii) in the case of any animal, article, facility,
or means of conveyance under the jurisdiction of an
Indian tribe, the head of the Indian tribe.
(B) NOTICE.—Subject to subparagraph (C), before any
action is taken in a State under subparagraph (A), the
Secretary shall—
(i) notify the Governor, an appropriate animal
health official of the State, or head of the Indian tribe
of the proposed action;
(ii) issue a public announcement of the proposed
action; and
(iii) publish in the Federal Register—
(I) the findings of the Secretary;
(II) a description of the proposed action; and
(III) a statement of the reasons for the proposed action.
(C) NOTICE AFTER ACTION.—If it is not practicable to
publish in the Federal Register the information required
under subparagraph (B)(iii) before taking action under
subparagraph (A), the Secretary shall publish the information as soon as practicable, but not later than 10 business
days, after commencement of the action.
(c) QUARANTINE, DISPOSAL, OR OTHER REMEDIAL ACTION.—
(1) IN GENERAL.—The Secretary, in writing, may order
the owner of any animal, article, facility, or means of conveyance referred to in subsection (a) or (b) to maintain in quarantine, dispose of, or take other remedial action with respect
to the animal, article, facility, or means of conveyance, in
a manner determined by the Secretary.
(2) FAILURE TO COMPLY WITH ORDERS.—If the owner fails
to comply with the order of the Secretary, the Secretary may—
(A) seize, quarantine, dispose of, or take other remedial
action with respect to the animal, article, facility, or means
of conveyance under subsection (a) or (b); and
(B) recover from the owner the costs of any care, handling, disposal, or other remedial action incurred by the
Secretary in connection with the seizure, quarantine, disposal, or other remedial action.
(d) COMPENSATION.—

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Public
information.
Federal Register,
publication.

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(1) IN GENERAL.—Except as provided in paragraph (3), the
Secretary shall compensate the owner of any animal, article,
facility, or means of conveyance that the Secretary requires
to be destroyed under this section.
(2) AMOUNT.—
(A) IN GENERAL.—Subject to subparagraphs (B) and
(C), the compensation shall be based on the fair market
value, as determined by the Secretary, of the destroyed
animal, article, facility, or means of conveyance.
(B) LIMITATION.—Compensation paid any owner under
this subsection shall not exceed the difference between—
(i) the fair market value of the destroyed animal,
article, facility, or means of conveyance; and
(ii) any compensation received by the owner from
a State or other source for the destroyed animal,
article, facility, or means of conveyance.
(C) REVIEWABILITY.—The determination by the Secretary of the amount to be paid under this subsection
shall be final and not subject to judicial review or review
of longer than 60 days by any officer or employee of the
Federal Government other than the Secretary or the designee of the Secretary.
(3) EXCEPTIONS.—No payment shall be made by the Secretary under this subsection for—
(A) any animal, article, facility, or means of conveyance
that has been moved or handled by the owner in violation
of an agreement for the control and eradication of diseases
or pests or in violation of this subtitle;
(B) any progeny of any animal or article, which animal
or article has been moved or handled by the owner of
the animal or article in violation of this subtitle;
(C) any animal, article, or means of conveyance that
is refused entry under this subtitle; or
(D) any animal, article, facility, or means of conveyance
that becomes or has become affected with or exposed to
any pest or disease of livestock because of a violation
of an agreement for the control and eradication of diseases
or pests or a violation of this subtitle by the owner.

7 USC 8307.

SEC. 10408. INSPECTIONS, SEIZURES, AND WARRANTS.

(a) GUIDELINES.—The activities authorized by this section shall
be carried out consistent with guidelines approved by the Attorney
General.
(b) WARRANTLESS INSPECTIONS.—The Secretary may stop and
inspect, without a warrant, any person or means of conveyance
moving—
(1) into the United States, to determine whether the person
or means of conveyance is carrying any animal or article regulated under this subtitle;
(2) in interstate commerce, on probable cause to believe
that the person or means of conveyance is carrying any animal
or article regulated under this subtitle; or
(3) in intrastate commerce from any State, or any portion
of a State, quarantined under section 10407(b), on probable
cause to believe that the person or means of conveyance is
carrying any animal or article quarantined under section
10407(b).

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(c) INSPECTIONS WITH WARRANTS.—
(1) IN GENERAL.—The Secretary may enter, with a warrant,
any premises in the United States for the purpose of making
inspections and seizures under this subtitle.
(2) APPLICATION AND ISSUANCE OF WARRANTS.—
(A) IN GENERAL.—On proper oath or affirmation
showing probable cause to believe that there is on certain
premises any animal, article, facility, or means of conveyance regulated under this subtitle, a United States judge,
a judge of a court of record in the United States, or a
United States magistrate judge may issue a warrant for
the entry on premises within the jurisdiction of the judge
or magistrate to make any inspection or seizure under
this subtitle.
(B) EXECUTION.—The warrant may be applied for and
executed by the Secretary or any United States marshal.
SEC. 10409. DETECTION, CONTROL, AND ERADICATION OF DISEASES
AND PESTS.

7 USC 8308.

(a) IN GENERAL.—The Secretary may carry out operations and
measures to detect, control, or eradicate any pest or disease of
livestock (including the drawing of blood and diagnostic testing
of animals), including animals at a slaughterhouse, stockyard, or
other point of concentration.
(b) COMPENSATION.—
(1) IN GENERAL.—The Secretary may pay a claim arising
out of the destruction of any animal, article, or means of conveyance consistent with the purposes of this subtitle.
(2) REVIEWABILITY.—The action of the Secretary in carrying
out paragraph (1) shall not be subject to review of longer
than 60 days by any officer or employee of the Federal Government other than the Secretary or the designee of the Secretary.
SEC. 10410. VETERINARY ACCREDITATION PROGRAM.

7 USC 8309.

(a) IN GENERAL.—The Secretary may establish a veterinary
accreditation program that is consistent with this subtitle, including
the establishment of standards of conduct for accredited veterinarians.
(b) CONSULTATION.—The Secretary shall consult with State
animal health officials and veterinary professionals regarding the
establishment of the veterinary accreditation program.
(c) SUSPENSION OR REVOCATION OF ACCREDITATION.—
(1) IN GENERAL.—The Secretary may, after notice and
opportunity for a hearing on the record, suspend or revoke
the accreditation of any veterinarian accredited under this title
who violates this subtitle.
(2) FINAL ORDER.—The order of the Secretary suspending
or revoking accreditation shall be treated as a final order
reviewable under chapter 158 of title 28, United States Code.
(3) SUMMARY SUSPENSION.—
(A) IN GENERAL.—The Secretary may summarily suspend the accreditation of a veterinarian whom the Secretary has reason to believe knowingly violated this subtitle.
(B) HEARINGS.—The Secretary shall provide the veterinarian with a subsequent notice and an opportunity for
a prompt post-suspension hearing on the record.

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(d) APPLICATION OF PENALTY PROVISIONS.—The criminal and
civil penalties described in section 10414 shall not apply to a
violation of this section that is not a violation of any other provision
of this subtitle.
7 USC 8310.

SEC. 10411. COOPERATION.

(a) IN GENERAL.—To carry out this subtitle, the Secretary may
cooperate with other Federal agencies, States or political subdivisions of States, national governments of foreign countries, local
governments of foreign countries, domestic or international
organizations, domestic or international associations, Indian tribes,
and other persons.
(b) RESPONSIBILITY.—The person or other entity cooperating
with the Secretary shall be responsible for the authority necessary
to carry out operations or measures—
(1) on all land and property within a foreign country or
State, or under the jurisdiction of an Indian tribe, other than
on land and property owned or controlled by the United States;
and
(2) using other facilities and means, as determined by
the Secretary.
(c) SCREWWORMS.—
(1) IN GENERAL.—The Secretary may, independently or in
cooperation with national governments of foreign countries or
international organizations or associations, produce and sell
sterile screwworms to any national government of a foreign
country or international organization or association, if the Secretary determines that the livestock industry and related industries of the United States will not be adversely affected by
the production and sale.
(2) PROCEEDS.—
(A) INDEPENDENT PRODUCTION AND SALE.—If the Secretary independently produces and sells sterile screwworms
under paragraph (1), the proceeds of the sale shall be—
(i) deposited into the Treasury of the United
States; and
(ii) credited to the account from which the operating expenses of the facility producing the sterile
screwworms have been paid.
(B) COOPERATIVE PRODUCTION AND SALE.—
(i) IN GENERAL.—If the Secretary cooperates to
produce and sell sterile screwworms under paragraph
(1), the proceeds of the sale shall be divided between
the United States and the cooperating national government or international organization or association in
a manner determined by the Secretary.
(ii) ACCOUNT.—The United States portion of the
proceeds shall be—
(I) deposited into the Treasury of the United
States; and
(II) credited to the account from which the
operating expenses of the facility producing the
sterile screwworms have been paid.
(d) COOPERATION IN PROGRAM ADMINISTRATION.—The Secretary
may cooperate with State authorities, Indian tribe authorities, or
other persons in the administration of regulations for the improvement of livestock and livestock products.

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(e) CONSULTATION AND COORDINATION WITH OTHER FEDERAL
AGENCIES.—
(1) IN GENERAL.—The Secretary shall consult and coordinate with the head of a Federal agency with respect to any
activity that is under the jurisdiction of the Federal agency.
(2) LEAD AGENCY.—Subject to the consultation and
coordination requirement in paragraph (1), the Department
of Agriculture shall be the lead agency with respect to issues
related to pests and diseases of livestock.
SEC. 10412. REIMBURSABLE AGREEMENTS.

7 USC 8311.

(a) AUTHORITY TO ENTER INTO AGREEMENTS.—The Secretary
may enter into reimbursable fee agreements with persons for
preclearance of animals or articles at locations outside the United
States for movement into the United States.
(b) FUNDS COLLECTED FOR PRECLEARANCE.—Funds collected
for preclearance activities shall—
(1) be credited to accounts that may be established by
the Secretary for carrying out this section; and
(2) remain available until expended for the preclearance
activities, without fiscal year limitation.
(c) PAYMENT OF EMPLOYEES.—
(1) IN GENERAL.—Notwithstanding any other law, the Secretary may pay an officer or employee of the Department of
Agriculture performing services under this subtitle relating
to imports into and exports from the United States for all
overtime, night, or holiday work performed by the officer or
employee at a rate of pay determined by the Secretary.
(2) REIMBURSEMENT.—
(A) IN GENERAL.—The Secretary may require a person
for whom the services are performed to reimburse the
Secretary for any expenses paid by the Secretary for the
services under this subsection.
(B) USE OF FUNDS.—All funds collected under this subsection shall—
(i) be credited to the account that incurs the costs;
and
(ii) remain available until expended, without fiscal
year limitation.
(d) LATE PAYMENT PENALTIES.—
(1) COLLECTION.—On failure by a person to reimburse the
Secretary in accordance with this section, the Secretary may
assess a late payment penalty against the person, including
interest on overdue funds, as required by section 3717 of title
31, United States Code.
(2) USE OF FUNDS.—Any late payment penalty and any
accrued interest shall—
(A) be credited to the account that incurs the costs;
and
(B) remain available until expended, without fiscal year
limitation.
SEC. 10413. ADMINISTRATION AND CLAIMS.

7 USC 8312.

(a) ADMINISTRATION.—To carry out this subtitle, the Secretary
may—
(1) acquire and maintain real or personal property;
(2) employ a person;
(3) make a grant; and

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(4) notwithstanding chapter 63 of title 31, United States
Code, enter into a contract, cooperative agreement, memorandum of understanding, or other agreement.
(b) TORT CLAIMS.—
(1) IN GENERAL.—Except as provided in paragraph (2), the
Secretary may pay a tort claim, in the manner authorized
by the first paragraph of section 2672 of title 28, United States
Code, if the claim arises outside the United States in connection
with an activity authorized under this subtitle.
(2) REQUIREMENTS.—A claim may not be allowed under
this subsection unless the claim is presented in writing to
the Secretary not later than 2 years after the date on which
the claim arises.

7 USC 8313.

SEC. 10414. PENALTIES.

(a) CRIMINAL PENALTIES.—
(1) OFFENSES.—
(A) IN GENERAL.—A person that knowingly violates
this subtitle, or knowingly forges, counterfeits, or, without
authority from the Secretary, uses, alters, defaces, or
destroys any certificate, permit, or other document provided
for in this subtitle shall be fined under title 18, United
States Code, imprisoned not more than 1 year, or both.
(B) DISTRIBUTION OR SALE.—A person that knowingly
imports, enters, exports, or moves any animal or article,
for distribution or sale, in violation of this subtitle, shall
be fined under title 18, United States Code, imprisoned
not more than 5 years, or both.
(2) MULTIPLE VIOLATIONS.—On the second and any subsequent conviction of a person of a violation of this subtitle
under paragraph (1), the person shall be fined under title
18, United States Code, imprisoned not more than 10 years,
or both.
(b) CIVIL PENALTIES.—
(1) IN GENERAL.—Except as provided in section 10410(d),
any person that violates this subtitle, or that forges, counterfeits, or, without authority from the Secretary, uses, alters,
defaces, or destroys any certificate, permit, or other document
provided under this subtitle may, after notice and opportunity
for a hearing on the record, be assessed a civil penalty by
the Secretary that does not exceed the greater of—
(A)(i) $50,000 in the case of any individual, except
that the civil penalty may not exceed $1,000 in the case
of an initial violation of this subtitle by an individual
moving regulated articles not for monetary gain;
(ii) $250,000 in the case of any other person for each
violation; and
(iii) $500,000 for all violations adjudicated in a single
proceeding; or
(B) twice the gross gain or gross loss for any violation
or forgery, counterfeiting, or unauthorized use, alteration,
defacing or destruction of a certificate, permit, or other
document provided under this subtitle that results in the
person’s deriving pecuniary gain or causing pecuniary loss
to another person.
(2) FACTORS IN DETERMINING CIVIL PENALTY.—In determining the amount of a civil penalty, the Secretary shall take

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into account the nature, circumstance, extent, and gravity of
the violation or violations and the Secretary may consider,
with respect to the violator—
(A) the ability to pay;
(B) the effect on ability to continue to do business;
(C) any history of prior violations;
(D) the degree of culpability; and
(E) such other factors as the Secretary considers to
be appropriate.
(3) SETTLEMENT OF CIVIL PENALTIES.—The Secretary may
compromise, modify, or remit, with or without conditions, any
civil penalty that may be assessed under this subsection.
(4) FINALITY OF ORDERS.—
(A) FINAL ORDER.—The order of the Secretary assessing
a civil penalty shall be treated as a final order reviewable
under chapter 158 of title 28, United States Code.
(B) REVIEW.—The validity of the order of the Secretary
may not be reviewed in an action to collect the civil penalty.
(C) INTEREST.—Any civil penalty not paid in full when
due under an order assessing the civil penalty shall thereafter accrue interest until paid at the rate of interest
applicable to civil judgments of the courts of the United
States.
(c) LIABILITY FOR ACTS OF AGENTS.—In the construction and
enforcement of this subtitle, the act, omission, or failure of any
officer, agent, or person acting for or employed by any other person
within the scope of the employment or office of the officer, agent,
or person, shall be deemed also to be the act, omission, or failure
of the other person.
(d) GUIDELINES FOR CIVIL PENALTIES.—Subject to the approval
of the Attorney General, the Secretary shall establish guidelines
to determine under what circumstances the Secretary may issue
a civil penalty or suitable notice of warning in lieu of prosecution
by the Attorney General of a violation of this subtitle.
SEC. 10415. ENFORCEMENT.

7 USC 8314.

(a) COLLECTION OF INFORMATION.—
(1) IN GENERAL.—The Secretary may gather and compile
information and conduct any inspection or investigation that
the Secretary considers to be necessary for the administration
or enforcement of this subtitle.
(2) SUBPOENAS.—
(A) IN GENERAL.—The Secretary shall have power to
issue a subpoena to compel the attendance and testimony
of any witness and the production of any documentary
evidence relating to the administration or enforcement of
this subtitle or any matter under investigation in connection with this subtitle.
(B) LOCATION OF PRODUCTION.—The attendance of any
witness and production of documentary evidence relevant
to the inquiry may be required from any place in the
United States.
(C) ENFORCEMENT.—
(i) IN GENERAL.—In case of disobedience to a subpoena by any person, the Secretary may request the
Attorney General to invoke the aid of any court of
the United States within the jurisdiction in which the

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investigation is conducted, or where the person resides,
is found, transacts business, is licensed to do business,
or is incorporated, to require the attendance and testimony of any witness and the production of documentary evidence.
(ii) NONCOMPLIANCE.—In case of a refusal to obey
a subpoena issued to any person, a court may order
the person to appear before the Secretary and give
evidence concerning the matter in question or to
produce documentary evidence.
(iii) CONTEMPT.—Any failure to obey the order of
the court may be punished by the court as contempt
of the court.
(D) COMPENSATION.—
(i) WITNESSES.—A witness summoned by the Secretary under this subtitle shall be paid the same fees
and mileage that are paid to a witness in a court
of the United States.
(ii) DEPOSITIONS.—A witness whose deposition is
taken, and the person taking the deposition, shall be
entitled to the same fees that are paid for similar
services in a court of the United States.
(E) PROCEDURES.—
(i) PUBLICATION.—The Secretary shall publish
procedures for the issuance of subpoenas under this
section.
(ii) REVIEW.—The procedures shall include a
requirement that subpoenas be reviewed for legal sufficiency and, to be effective, be signed by the Secretary.
(iii) DELEGATION.—If the authority to sign a subpoena is delegated to an agency other than the Office
of Administrative Law Judges, the agency receiving
the delegation shall seek review of the subpoena for
legal sufficiency outside that agency.
(b) AUTHORITY OF ATTORNEY GENERAL.—The Attorney General
may—
(1) prosecute, in the name of the United States, all criminal
violations of this subtitle that are referred to the Attorney
General by the Secretary or are brought to the notice of the
Attorney General by any person;
(2) bring an action to enjoin the violation of or to compel
compliance with this subtitle, or to enjoin any interference
by any person with the Secretary in carrying out this subtitle,
in any case in which the Secretary has reason to believe that
the person has violated, or is about to violate this subtitle
or has interfered, or is about to interfere, with the actions
of the Secretary; or
(3) bring an action for the recovery of any unpaid civil
penalty, funds under a reimbursable agreement, late payment
penalty, or interest assessed under this subtitle.
(c) COURT JURISDICTION.—
(1) IN GENERAL.—The United States district courts, the
District Court of Guam, the District Court of the Northern
Mariana Islands, the District Court of the Virgin Islands, the
highest court of American Samoa, and the United States courts
of the other territories and possessions are vested with jurisdiction in all cases arising under this subtitle.

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(2) VENUE.—Any action arising under this subtitle may
be brought, and process may be served, in the judicial district
where a violation or interference occurred or is about to occur,
or where the person charged with the violation, interference,
impending violation, impending interference, or failure to pay
resides, is found, transacts business, is licensed to do business,
or is incorporated.
(3) EXCEPTION.—Paragraphs (1) and (2) do not apply to
sections 10410(c) and 10414(b).
SEC. 10416. REGULATIONS AND ORDERS.

7 USC 8315.

The Secretary may promulgate such regulations, and issue
such orders, as the Secretary determines necessary to carry out
this subtitle.
SEC. 10417. AUTHORIZATION OF APPROPRIATIONS.

7 USC 8316.

(a) IN GENERAL.—There are authorized to be appropriated such
sums as are necessary to carry out this subtitle.
(b) TRANSFER OF FUNDS.—
(1) IN GENERAL.—In connection with an emergency under
which a pest or disease of livestock threatens any segment
of agricultural production in the United States, the Secretary
may transfer from other appropriations or funds available to
the agencies or corporations of the Department of Agriculture
such funds as the Secretary determines are necessary for the
arrest, control, eradication, or prevention of the spread of the
pest or disease of livestock and for related expenses.
(2) AVAILABILITY.—Any funds transferred under this subsection shall remain available until expended, without fiscal
year limitation.
(3) REVIEWABILITY.—The action of any officer, employee,
or agent of the Secretary in carrying out this section (including
determining the amount of and making any payment authorized
to be made under this subtitle) shall not be subject to review
of longer than 60 days by any officer or employee of the Federal
Government other than the Secretary or the designee of the
Secretary.
(c) USE OF FUNDS.—In carrying out this subtitle, the Secretary
may use funds made available to carry out this subtitle for—
(1) the employment of civilian nationals in foreign countries; and
(2) the construction and operation of research laboratories,
quarantine stations, and other buildings and facilities for special purposes.
SEC. 10418. REPEALS AND CONFORMING AMENDMENTS.

(a) REPEALS.—The following provisions of law are repealed:
(1) Public Law 97–46 (7 U.S.C. 147b).
(2) Section 101(b) of the Act of September 21, 1944 (7
U.S.C. 429).
(3) The Act of August 28, 1950 (7 U.S.C. 2260).
(4) Section 919 of the Federal Agriculture Improvement
and Reform Act of 1996 (7 U.S.C. 2260a).
(5) Section 306 of the Tariff Act of 1930 (19 U.S.C. 1306).
(6) Sections 6 through 8 and 10 of the Act of August
30, 1890 (21 U.S.C. 102 through 105).
(7) The Act of February 2, 1903 (21 U.S.C. 111, 120 through
122).

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21 USC 129a
and note.

21 USC 111–113,
120–122.

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(8) Sections 2 through 9, 11, and 13 of the Act of May
29, 1884 (21 U.S.C. 112, 113, 114, 114a, 114a–1, 115 through
120, 130).
(9) The first section and sections 2, 3, and 5 of the Act
of February 28, 1947 (21 U.S.C. 114b, 114c, 114d, 114d–1).
(10) The Act of June 16, 1948 (21 U.S.C. 114e, 114f).
(11) Public Law 87–209 (21 U.S.C. 114g, 114h).
(12) The third and fourth provisos of the fourth paragraph
under the heading ‘‘BUREAU OF ANIMAL INDUSTRY’’ of the Act
of May 31, 1920 (21 U.S.C. 116).
(13) The first section and sections 2, 3, 4, and 6 of the
Act of March 3, 1905 (21 U.S.C. 123 through 127).
(14) The first proviso under the heading ‘‘GENERAL
EXPENSES, BUREAU OF ANIMAL INDUSTRY’’ under the heading
‘‘BUREAU OF ANIMAL INDUSTRY’’ of the Act of June 30,
1914 (21 U.S.C. 128).
(15) The fourth proviso under the heading ‘‘SALARIES AND
EXPENSES’’ under the heading ‘‘ANIMAL AND PLANT HEALTH
INSPECTION SERVICE’’ of title I of the Agriculture, Rural
Development, Food and Drug Administration, and Related
Agencies Appropriations Act, 2001 (21 U.S.C. 129).
(16) The third paragraph under the heading ‘‘MISCELLANEOUS’’ of the Act of May 26, 1910 (21 U.S.C. 131).
(17) The first section and sections 2 through 6 and 11
through 13 of Public Law 87–518 (21 U.S.C. 134 through 134h).
(18) Public Law 91–239 (21 U.S.C. 135 through 135b).
(19) Sections 12 through 14 of the Federal Meat Inspection
Act (21 U.S.C. 612 through 614).
(20) Chapter 39 of title 46, United States Code.
(b) CONFORMING AMENDMENTS.—
(1) Section 414(b) of the Plant Protection Act (7 U.S.C.
7714(b)) is amended—
(A) in paragraph (1), by striking ‘‘, or the owner’s
agent,’’; and
(B) in paragraph (2), by striking ‘‘or agent of the owner’’
each place it appears.
(2) Section 423 of the Plant Protection Act (7 U.S.C. 7733)
is amended—
(A) by striking subsection (b) and inserting the following:
‘‘(b) LOCATION OF PRODUCTION.—The attendance of any witness
and production of documentary evidence relevant to the inquiry
may be required from any place in the United States.’’;
(B) in the third sentence of subsection (e), by inserting
‘‘to an agency other than the Office of Administrative Law
Judges’’ after ‘‘is delegated’’; and
(C) by striking subsection (f).
(3) Section 11(h) of the Endangered Species Act of 1973
(16 U.S.C. 1540(h)) is amended in the first sentence by striking
‘‘animal quarantine laws (21 U.S.C. 101–105, 111–135b, and
612–614)’’ and inserting ‘‘animal quarantine laws (as defined
in section 2509(f) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (21 U.S.C. 136a(f))’’.
(4) Section 18 of the Federal Meat Inspection Act (21 U.S.C.
618) is amended by striking ‘‘of the cattle’’ and all that follows
through ‘‘as herein described’’ and inserting ‘‘of the carcasses

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and products of cattle, sheep, swine, goats, horses, mules, and
other equines’’.
(5) Section 2509 of the Food, Agriculture, Conservation,
and Trade Act of 1990 (21 U.S.C. 136a) is amended—
(A) in subsection (c), by inserting after paragraph (1)
the following:
‘‘(2) VETERINARY DIAGNOSTICS.—The Secretary may prescribe and collect fees to recover the costs of carrying out
the provisions of the Animal Health Protection Act that relate
to veterinary diagnostics.’’; and
(B) in subsection (f)(1), by striking subparagraphs (B)
through (O) and inserting the following:
‘‘(B) section 9 of the Act of August 30, 1890 (21 U.S.C.
101);
‘‘(C) the Animal Health Protection Act; or
‘‘(D) any other Act administered by the Secretary
relating to plant or animal diseases or pests.’’.
(c) EFFECT ON REGULATIONS.—A regulation issued under a
provision of law repealed by subsection (a) shall remain in effect
until the Secretary issues a regulation under section 10404(b) or
10416 that supersedes the earlier regulation.

7 USC 8317.

Subtitle F—Livestock
SEC. 10501. TRANSPORTATION OF POULTRY AND OTHER ANIMALS.

Section 5402(d)(2) of title 39, United States Code, is amended—
(1) in subparagraph (A), by inserting ‘‘, honeybees,’’ after
‘‘poultry’’; and
(2) by striking subparagraph (C).
SEC. 10502. SWINE CONTRACTORS.

(a) DEFINITIONS.—Section 2(a) of the Packers and Stockyards
Act, 1921 (7 U.S.C. 182(a)), is amended by adding at the end
the following:
‘‘(12) SWINE CONTRACTOR.—The term ‘swine contractor’
means any person engaged in the business of obtaining swine
under a swine production contract for the purpose of slaughtering the swine or selling the swine for slaughter, if—
‘‘(A) the swine is obtained by the person in commerce;
or
‘‘(B) the swine (including products from the swine)
obtained by the person is sold or shipped in commerce.
‘‘(13) SWINE PRODUCTION CONTRACT.—The term ‘swine
production contract’ means any growout contract or other
arrangement under which a swine production contract grower
raises and cares for the swine in accordance with the instructions of another person.
‘‘(14) SWINE PRODUCTION CONTRACT GROWER.—The term
‘swine production contract grower’ means any person engaged
in the business of raising and caring for swine in accordance
with the instructions of another person.’’.
(b) SWINE CONTRACTORS.—
(1) IN GENERAL.—The Packers and Stockyards Act, 1921,
is amended by striking ‘‘packer’’ each place it appears in sections 202, 203, 204, and 205 (7 U.S.C. 192, 193, 194, 195)

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(other than section 202(c)) and inserting ‘‘packer or swine contractor’’.
(2) CONFORMING AMENDMENTS.—
(A) Section 202(c) of the Packers and Stockyards Act,
1921 (7 U.S.C. 192(c)), is amended by inserting ‘‘, swine
contractor,’’ after ‘‘other packer’’ each place it appears.
(B) Section 308(a) of the Packers and Stockyards Act,
1921 (7 U.S.C. 209(a)), is amended by inserting ‘‘or swine
production contract’’ after ‘‘poultry growing arrangement’’.
(C) Sections 401 and 403 of the Packers and Stockyards
Act, 1921 (7 U.S.C. 221, 223), are amended by inserting
‘‘any swine contractor, and’’ after ‘‘packer,’’ each place it
appears.

7 USC 229b.

SEC. 10503. RIGHT TO DISCUSS TERMS OF CONTRACT.

(a) DEFINITIONS.—In this section:
(1) PRODUCER.—The term ‘‘producer’’ means any person
engaged in the raising and caring for livestock or poultry for
slaughter.
(2) PROCESSOR.—The term ‘‘processor’’ means any person
engaged in the business of obtaining livestock or poultry for
the purpose of slaughtering the livestock or poultry.
(b) NO PROHIBITION OF DISCUSSION.—Notwithstanding a provision in any contract between a producer and a processor for the
production of livestock or poultry, or in any marketing agreement
between a producer and a processor for the sale of livestock or
poultry for a term of 1 year or more, that provides that information
contained in the contract is confidential, a party to the contract
shall not be prohibited from discussing any terms or details of
the contract with—
(1) a Federal or State agency;
(2) a legal adviser to the party;
(3) a lender to the party;
(4) an accountant hired by the party;
(5) an executive or manager of the party;
(6) a landlord of the party; or
(7) a member of the immediate family of the party.
(c) EFFECT ON STATE LAWS.—Subsection (b) does not—
(1) preempt any State law that addresses confidentiality
provisions in contracts for the sale or production of livestock
or poultry, except any provision of State law that makes lawful
a contract provision that prohibits a party from, or limits a
party in, engaging in discussion that subsection (b) requires
to be permitted; or
(2) deprive any State court of jurisdiction under any such
State law.
(d) APPLICABILITY.—This section applies to each contract
described in subsection (b) that is entered into, amended, renewed,
or extended after the date of enactment of this Act.
7 USC 8318.

SEC. 10504. VETERINARY TRAINING.

The Secretary of Agriculture may develop a program to maintain in all regions of the United States a sufficient number of
Federal and State veterinarians who are well trained in recognition
and diagnosis of exotic and endemic animal diseases.

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SEC. 10505. PSEUDORABIES ERADICATION PROGRAM.

Section 2506(d) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (21 U.S.C. 114i(d)) is amended by striking ‘‘2002’’
and inserting ‘‘2007’’.

Subtitle G—Specialty Crops
SEC. 10601. MARKETING ORDERS FOR CANEBERRIES.

(a) IN GENERAL.—Section 8c of the Agricultural Adjustment
Act (7 U.S.C. 608c), reenacted with amendments by the Agricultural
Marketing Agreement Act of 1937, is amended—
(1) in subsection (2)(A), by inserting ‘‘caneberries (including
raspberries, blackberries, and loganberries),’’ after ‘‘other than
pears, olives, grapefruit, cherries,’’; and
(2) in subsection (6)(I), by striking ‘‘tomatoes,,’’ and
inserting ‘‘tomatoes, caneberries (including raspberries, blackberries, and loganberries),’’.
(b) CONFORMING AMENDMENT.—Section 8e(a) of the Agricultural
Adjustment Act (7 U.S.C. 608e–l(a)), reenacted with amendments
by the Agricultural Marketing Agreement Act of 1937, is amended
in the first sentence by striking ‘‘or apples’’ and inserting ‘‘apples,
or caneberries (including raspberries, blackberries, and loganberries)’’.
SEC. 10602. AVAILABILITY OF SECTION 32 FUNDS.

The second undesignated paragraph of section 32 of the Act
of August 24, 1935 (7 U.S.C. 612c), is amended by striking
‘‘$300,000,000’’ and inserting ‘‘$500,000,000’’.
SEC. 10603. PURCHASE OF SPECIALTY CROPS.

7 USC 612c–4.

(a) GENERAL PURCHASE AUTHORITY.—Of the funds made available under section 32 of the Act of August 24, 1935 (7 U.S.C.
612c), for fiscal year 2002 and each subsequent fiscal year, the
Secretary of Agriculture shall use not less than $200,000,000 each
fiscal year to purchase fruits, vegetables, and other specialty food
crops.
(b) PURCHASE AUTHORITY.—
(1) PURCHASE.—Of the amount specified in subsection (a),
the Secretary of Agriculture shall use not less than $50,000,000
each fiscal year for the purchase of fresh fruits and vegetables
for distribution to schools and service institutions in accordance
with section 6(a) of the Richard B. Russell National School
Lunch Act (42 U.S.C. 1755(a)).
(2) SERVICING AGENCY.—The Secretary of Agriculture shall
provide for the Secretary of Defense to serve as the servicing
agency for the procurement of the fresh fruits and vegetables
under this subsection on the same terms and conditions as
provided in the memorandum of agreement entered into
between the Agricultural Marketing Service, the Food and Consumer Service, and the Defense Personnel Support Center
during August 1995 (or any successor memorandum of agreement).
(c) DEFINITIONS.—In this section, the terms ‘‘fruits’’, ‘‘vegetables’’, and ‘‘other specialty food crops’’ shall have the meaning
given the terms by the Secretary of Agriculture.

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SEC. 10604. PROTECTION FOR PURCHASERS OF FARM PRODUCTS.

(a) DEFINITION OF EFFECTIVE FINANCING STATEMENT.—Section
1324(c)(4) of the Food Security Act of 1985 (7 U.S.C. 1631(c)(4))
is amended—
(1) in subparagraph (B), by striking ‘‘signed’’ and inserting
‘‘signed, authorized, or otherwise authenticated by the debtor,’’;
(2) by striking subparagraph (C);
(3) in subparagraph (D)—
(A) in clause (iii), by adding ‘‘and’’ after the semicolon
at the end; and
(B) in clause (iv), by striking ‘‘applicable;’’ and all that
follows and inserting ‘‘applicable, and the name of each
county or parish in which the farm products are produced
or located;’’;
(4) in subparagraph (E), by striking ‘‘signed’’ and inserting
‘‘signed, authorized, or otherwise authenticated by the debtor’’;
(5) in subparagraph (G), by striking ‘‘notice signed’’ and
inserting ‘‘notice signed, authorized, or otherwise authenticated’’; and
(6) by redesignating subparagraphs (D) through (I) as subparagraphs (C) through (H), respectively.
(b) PURCHASES SUBJECT TO SECURITY INTERESTS.—Section
1324(e) of the Food Security Act of 1985 (7 U.S.C. 1631(e)) is
amended—
(1) in paragraph (1)(A)(ii)—
(A) in subclause (III), by adding ‘‘and’’ after the semicolon at the end; and
(B) in subclause (IV), by striking ‘‘crop year,’’ and all
that follows and inserting ‘‘crop year, and the name of
each county or parish in which the farm products are
produced or located;’’;
(2) in paragraph (1)(A)(iii), by striking ‘‘similarly signed’’
and inserting ‘‘similarly signed, authorized, or otherwise
authenticated’’;
(3) in paragraph (1)(A)(iv), by striking ‘‘notice signed’’ and
inserting ‘‘notice signed, authorized, or otherwise authenticated’’;
(4) in paragraph (1)(A)(v), by inserting ‘‘contains’’ before
‘‘any payment’’; and
(5) in paragraph (3)—
(A) in subparagraph (A), by striking ‘‘subparagraph’’
and inserting ‘‘subsection’’; and
(B) in subparagraph (B), by striking ‘‘; and’’ and
inserting a period.
(c) CERTAIN SALES SUBJECT TO SECURITY INTEREST.—Section
1324(g)(2)(A) of the Food Security Act of 1985 (7 U.S.C.
1631(g)(2)(A)) is amended—
(1) in clause (ii)—
(A) in subclause (III), by adding ‘‘and’’ after the semicolon at the end; and
(B) in subclause (IV), by striking ‘‘crop year,’’ and all
that follows and inserting ‘‘crop year, and the name of
each county or parish in which the farm products are
produced or located;’’;
(2) in clause (iii), by striking ‘‘similarly signed’’ and
inserting ‘‘similarly signed, authorized, or otherwise authenticated’’;

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(3) in clause (iv), by striking ‘‘notice signed’’ and inserting
‘‘notice signed, authorized, or otherwise authenticated’’; and
(4) in clause (v), by inserting ‘‘contains’’ before ‘‘any payment’’.
SEC. 10605. FARMERS’ MARKET PROMOTION PROGRAM.

(a) IN GENERAL.—The Farmer-to-Consumer Direct Marketing
Act of 1976 is amended by inserting after section 5 (7 U.S.C.
3004) the following:
‘‘SEC. 6. FARMERS’ MARKET PROMOTION PROGRAM.

7 USC 3005.

‘‘(a) ESTABLISHMENT.—The Secretary shall carry out a program,
to be known as the ‘Farmers’ Market Promotion Program’ (referred
to in this section as the ‘Program’), to make grants to eligible
entities for projects to establish, expand, and promote farmers’
markets.
‘‘(b) PROGRAM PURPOSES.—
‘‘(1) IN GENERAL.—The purposes of the Program are—
‘‘(A) to increase domestic consumption of agricultural
commodities by improving and expanding, or assisting in
the improvement and expansion of, domestic farmers’ markets, roadside stands, community-supported agriculture
programs, and other direct producer-to-consumer market
opportunities; and
‘‘(B) to develop, or aid in the development of, new
farmers’ markets, roadside stands, community-supported
agriculture programs, and other direct producer-to-consumer infrastructure.
‘‘(2) LIMITATIONS.—An eligible entity may not use a grant
or other assistance provided under the Program for the purchase, construction, or rehabilitation of a building or structure.
‘‘(c) ELIGIBLE ENTITIES.—An entity shall be eligible to receive
a grant under the Program if the entity is—
‘‘(1) an agricultural cooperative;
‘‘(2) a local government;
‘‘(3) a nonprofit corporation;
‘‘(4) a public benefit corporation;
‘‘(5) an economic development corporation;
‘‘(6) a regional farmers’ market authority; or
‘‘(7) such other entity as the Secretary may designate.
‘‘(d) CRITERIA AND GUIDELINES.—The Secretary shall establish
criteria and guidelines for the submission, evaluation, and funding
of proposed projects under the Program.
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 2002 through 2007.’’.
(b) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) SURVEY.—Section 4 of the Farmer-to-Consumer Direct
Marketing Act of 1976 (7 U.S.C. 3003) is amended—
(A) in the first sentence, by striking ‘‘a continuing’’
and inserting ‘‘an annual’’; and
(B) by striking the second sentence.
(2) DIRECT MARKETING ASSISTANCE.—Section 5 of the
Farmer-to-Consumer Direct Marketing Act of 1976 (7 U.S.C.
3004) is amended—
(A) in subsection (a)—

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(i) in the first sentence, by striking ‘‘Extension
Service of the United States Department of Agriculture’’ and inserting ‘‘Secretary’’; and
(ii) in the second sentence—
(I) by striking ‘‘Extension Service’’ and
inserting ‘‘Secretary’’; and
(II) by striking ‘‘and on the basis of which
of these two agencies, or combination thereof, can
best perform these activities’’ and inserting ‘‘, as
determined by the Secretary’’;
(B) by redesignating subsection (b) as subsection (c);
and

(C) by inserting after subsection (a) the following:
‘‘(b) DEVELOPMENT OF FARMERS’ MARKETS.—The Secretary
shall—
‘‘(1) work with the Governor of a State, and a State agency
designated by the Governor, to develop programs to train managers of farmers’ markets;
‘‘(2) develop opportunities to share information among managers of farmers’ markets;
‘‘(3) establish a program to train cooperative extension
service employees in the development of direct marketing techniques; and
‘‘(4) work with producers to develop farmers’ markets.’’.
7 USC 6523.

SEC. 10606. NATIONAL ORGANIC CERTIFICATION COST-SHARE PROGRAM.

(a) IN GENERAL.—Of funds of the Commodity Credit Corporation, the Secretary of Agriculture (acting through the Agricultural
Marketing Service) shall use $5,000,000 for fiscal year 2002, to
remain available until expended, to establish a national organic
certification cost-share program to assist producers and handlers
of agricultural products in obtaining certification under the national
organic production program established under the Organic Foods
Production Act of 1990 (7 U.S.C. 6501 et seq.).
(b) FEDERAL SHARE.—
(1) IN GENERAL.—Subject to paragraph (2), the Secretary
shall pay under this section not more than 75 percent of the
costs incurred by a producer or handler in obtaining certification under the national organic production program, as certified to and approved by the Secretary.
(2) MAXIMUM AMOUNT.—The maximum amount of a payment made to a producer or handler under this section shall
be $500.
SEC. 10607. EXEMPTION OF CERTIFIED ORGANIC PRODUCTS FROM
ASSESSMENTS.

(a) IN GENERAL.—Section 501 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 7401) is amended
by adding at the end the following:
‘‘(e) EXEMPTION OF CERTIFIED ORGANIC PRODUCTS FROM ASSESSMENTS.—
‘‘(1) IN GENERAL.—Notwithstanding any provision of a commodity promotion law, a person that produces and markets
solely 100 percent organic products, and that does not produce
any conventional or nonorganic products, shall be exempt from
the payment of an assessment under a commodity promotion
law with respect to any agricultural commodity that is produced

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on a certified organic farm (as defined in section 2103 of the
Organic Foods Production Act of 1990 (7 U.S.C. 6502)).
‘‘(2) REGULATIONS.—Not later than 1 year after the date
of enactment of this subsection, the Secretary shall promulgate
regulations concerning eligibility and compliance for an exemption under paragraph (1).’’.
(b) TECHNICAL AMENDMENTS.—Section 501(a) of the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7401(a))
is amended—
(1) in paragraph (17), by striking ‘‘or’’;
(2) in paragraph (18), by striking the period and inserting
‘‘; or’’; and
(3) by adding at the end the following:
‘‘(19) any other provision of law enacted after April 4,
1996, that provides for the establishment and operation of
a promotion program described in the first sentence.’’.
SEC. 10608. CRANBERRY ACREAGE RESERVE PROGRAM.

(a) DEFINITIONS.—In this section:
(1) ELIGIBLE AREA.—The term ‘‘eligible area’’ means a wetland or buffer strip adjacent to a wetland that, as determined
by the Secretary—
(A)(i) is used, and has a history of being used, for
the cultivation of cranberries; or
(ii) is an integral component of a cranberry-growing
operation;
(B) is located in an environmentally sensitive area.
(2) SECRETARY.—The term ‘‘Secretary’’ means the Secretary
of Agriculture.
(b) PROGRAM.—The Secretary shall establish a program to purchase permanent easements in eligible areas from willing sellers.
(c) PURCHASE PRICE.—The Secretary shall ensure, to the maximum extent practicable, that each easement purchased under this
section is for an amount that appropriately reflects the range of
values for agricultural and nonagricultural land in the region in
which the eligible area subject to the easement is located (including
whether that land is located in 1 or more environmentally sensitive
areas, as determined by the Secretary).
(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $10,000,000.

Deadline.

16 USC 3801
note.

Subtitle H—Administration
SEC. 10701. INITIAL RATE OF BASIC PAY FOR EMPLOYEES OF COUNTY
COMMITTEES.

Section 5334 of title 5, United States Code, is amended by
striking subsection (e) and inserting the following:
‘‘(e) An employee of a county committee established pursuant
to section 8(b) of the Soil Conservation and Domestic Allotment
Act (16 U.S.C. 590h(b)) may, on appointment to a position subject
to this subchapter, have the initial rate of basic pay of the employee
fixed at—
‘‘(1) the lowest rate of the higher grade that exceeds the
rate of basic pay of the employee with the county committee
by not less than 2 step-increases of the grade from which
the employee was promoted, if the Federal Civil Service position

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under this subchapter is at a higher grade than the last grade
the employee had while an employee of the county committee;
‘‘(2) the same step of the grade as the employee last held
during service with the county committee, if the Federal Civil
Service position under this subchapter is at the same grade
as the last grade the employee had while an employee of
the county committee; or
‘‘(3) the lowest step of the Federal grade for which the
rate of basic pay is equal to or greater than the highest previous
rate of pay of the employee, if the Federal Civil Service position
under this subchapter is at a lower grade than the last grade
the employee had while an employee of the county committee.’’.

SEC. 10702. COMMODITY FUTURES TRADING COMMISSION PAY COMPARABILITY.

(a) APPOINTMENT AND COMPENSATION OF EMPLOYEES OF THE
COMMISSION.—Section 2(a) of the Commodity Exchange Act (7
U.S.C. 2(a)) is amended—
(1) by redesignating paragraphs (7) through (11) as paragraphs (8) through (12), respectively; and
(2) by inserting after paragraph (6) the following:
‘‘(7) APPOINTMENT AND COMPENSATION.—
‘‘(A) IN GENERAL.—The Commission may appoint and
fix the compensation of such officers, attorneys, economists,
examiners, and other employees as may be necessary for
carrying out the functions of the Commission under this
Act.
‘‘(B) RATES OF PAY.—Rates of basic pay for all
employees of the Commission may be set and adjusted
by the Commission without regard to chapter 51 or subchapter III of chapter 53 of title 5, United States Code.
‘‘(C) COMPARABILITY.—
‘‘(i) IN GENERAL.—The Commission may provide
additional compensation and benefits to employees of
the Commission if the same type of compensation or
benefits are provided by any agency referred to in
section 1206(a) of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C.
1833b(a)) or could be provided by such an agency under
applicable provisions of law (including rules and regulations).
‘‘(ii) CONSULTATION.—In setting and adjusting the
total amount of compensation and benefits for
employees, the Commission shall consult with, and
seek to maintain comparability with, the agencies
referred to in section 1206(a) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989
(12 U.S.C. 1833b(a)).’’.
(b) REPORTING OF INFORMATION BY THE COMMISSION.—Section
1206 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1833b) is amended—
(1) by striking ‘‘The Federal’’ and inserting the following:
‘‘(a) IN GENERAL.—The Federal’’; and
(2) by adding at the end the following:
‘‘(b) COMMODITY FUTURES TRADING COMMISSION.—In establishing and adjusting schedules of compensation and benefits for

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employees of the Commodity Futures Trading Commission under
applicable provisions of law, the Commission shall—
‘‘(1) inform the heads of the agencies referred to in subsection (a) and Congress of such compensation and benefits;
and
‘‘(2) seek to maintain comparability with those agencies
regarding compensation and benefits.’’.
(c) CONFORMING AMENDMENTS.—
(1) Section 3132(a)(1) of title 5, United States Code, is
amended—
(A) in subparagraph (C), by striking ‘‘or’’ at the end;
(B) in subparagraph (D), by adding ‘‘or’’ at the end;
and
(C) by adding at the end the following:
‘‘(E) the Commodity Futures Trading Commission;’’.
(2) Section 5316 of title 5, United States Code, is
amended—
(A) by striking ‘‘General Counsel, Commodity Futures
Trading Commission.’’; and
(B) by striking ‘‘Executive Director, Commodity
Futures Trading Commission.’’.
(3) Section 5373(a) of title 5, United States Code, is
amended—
(A) in paragraph (2), by striking ‘‘or’’ at the end;
(B) in paragraph (3), by striking the period at the
end and inserting ‘‘; or’’; and
(C) by adding at the end the following:
‘‘(4) section 2(a)(7) of the Commodity Exchange Act (7
U.S.C. 2(a)(7)).’’.
SEC. 10703. OVERTIME AND HOLIDAY PAY.

7 USC 2219a.

(a) IN GENERAL.—The Secretary of Agriculture may—
(1) pay employees of the Department of Agriculture
employed in an establishment subject to the Federal Meat
Inspection Act (21 U.S.C. 601 et seq.) or the Poultry Products
Inspection Act (21 U.S.C. 451 et seq.) for all overtime and
holiday work performed at the establishment at rates determined by the Secretary, subject to applicable law relating to
minimum wages and maximum hours; and
(2) accept from the establishment reimbursement for any
sums paid by the Secretary for the overtime and holiday work,
at rates determined under paragraph (1).
(b) AVAILABILITY.—Sums received by the Secretary under this
section shall remain available until expended without further appropriation and without fiscal year limitation, to carry out subsection
(a).
(c) CONFORMING AMENDMENTS.—
(1) Section 25 of the Poultry Products Inspection Act (21
U.S.C. 468) is amended by striking ‘‘except that the cost’’ and
all that follows and inserting ‘‘except the cost of overtime and
holiday pay paid pursuant to the section 10703 of the Farm
Security and Rural Investment Act of 2002.’’.
(2) The Act of June 5, 1948 (21 U.S.C. 695), is amended
by striking ‘‘overtime’’ and all that follows and inserting ‘‘overtime and holiday pay paid pursuant to section 10703 of the
Farm Security and Rural Investment Act of 2002.’’.

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(3) The matter under the heading ‘‘BUREAU OF ANIMAL
of the Act of July 24, 1919, is amended by striking
the next to the last paragraph (7 U.S.C. 394).
(4) Section 5549 of title 5, United States Code is amended
by striking paragraph (1) and inserting the following:
‘‘(1) section 10703 of the Farm Security and Rural Investment Act of 2002;’’.

INDUSTRY’’

7 USC 394.

SEC. 10704. ASSISTANT SECRETARY OF AGRICULTURE FOR CIVIL
RIGHTS.

(a) IN GENERAL.—Section 218 of the Department of Agriculture
Reorganization Act of 1994 (7 U.S.C. 6918) is amended—
(1) in subsection (a)—
(A) in paragraph (1), by striking ‘‘and’’ at the end;
(B) in paragraph (2), by striking the period at the
end and inserting ‘‘; and’’; and
(C) by adding at the end the following:
‘‘(3) Assistant Secretary of Agriculture for Civil Rights.’’;
and
(2) by striking subsections (d) and (e) and inserting the
following:
‘‘(d) DUTIES OF ASSISTANT SECRETARY OF AGRICULTURE FOR
CIVIL RIGHTS.—The Secretary may delegate to the Assistant Secretary for Civil Rights responsibility for—
‘‘(1) ensuring compliance with all civil rights and related
laws by all agencies and under all programs of the Department;
‘‘(2) coordinating administration of civil rights laws
(including regulations) within the Department for employees
of, and participants in, programs of the Department; and
‘‘(3) ensuring that necessary and appropriate civil rights
components are properly incorporated into all strategic planning initiatives of the Department and agencies of the Department.’’.
(b) COMPENSATION.—Section 5315 of title 5, United States Code,
is amended by striking ‘‘Assistant Secretaries of Agriculture (2)’’
and inserting ‘‘Assistant Secretaries of Agriculture (3)’’.
(c) CONFORMING AMENDMENTS.—Section 296(b) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 7014(b))
is amended—
(1) in paragraph (3), by striking ‘‘or’’ at the end;
(2) in paragraph (4), by striking the period at the end
and inserting ‘‘; or’’; and
(3) by adding at the end the following:
‘‘(5) the authority of the Secretary to establish within the
Department the position of Assistant Secretary of Agriculture
for Civil Rights, and delegate duties to the Assistant Secretary,
under section 218.’’.
SEC. 10705. OPERATION OF GRADUATE SCHOOL OF DEPARTMENT OF
AGRICULTURE.

(a) AUDITS OF RECORDS.—Section 921 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C. 2279b) is amended
by adding at the end the following:
‘‘(k) AUDITS OF RECORDS.—The financial records of the Graduate
School (including records relating to contracts or agreements
entered into under subsection (c)) shall be made available to the
Comptroller General for purposes of conducting an audit.’’.

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(b) CONFORMING REPEAL.—Section 1669 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5922) is
repealed.
(c) EFFECTIVE DATE.—The amendments made by this section
take effect on October 1, 2002.
SEC. 10706. IMPLEMENTATION FUNDING AND INFORMATION MANAGEMENT.

(a) ADDITIONAL FUNDS FOR ADMINISTRATIVE COSTS.—
(1) IN GENERAL.—The Secretary of Agriculture, acting
through the Farm Service Agency, may use not more than
$55,000,000 of funds of the Commodity Credit Corporation to
cover administrative costs associated with the implementation
of title I and the amendments made by that title.
(2) AVAILABILITY.—The funds referred to in paragraph (1)
shall remain available to the Secretary until expended.
(3) SET-ASIDE.—Of the amount specified in paragraph (1),
the Secretary shall use not less than $5,000,000, but not more
than $8,000,000, to carry out subsection (b).
(b) INFORMATION MANAGEMENT.—
(1) DEVELOPMENT OF SYSTEM.—The Secretary of Agriculture shall develop a comprehensive information management
system, using appropriate technologies, to be used in implementing the programs administered by the Federal Crop Insurance Corporation and the Farm Service Agency.
(2) ELEMENTS.—The information management system
developed under this subsection shall be designed to—
(A) improve access by agricultural producers to programs described in paragraph (1);
(B) improve and protect the integrity of the information
collected;
(C) meet the needs of the agencies that require the
data in the administration of their programs;
(D) improve the timeliness of the collection of the
information;
(E) contribute to the elimination of duplication of
information collection;
(F) lower the overall cost to the Department of Agriculture for information collection; and
(G) achieve such other goals as the Secretary considers
appropriate.
(3) RECONCILIATION OF CURRENT INFORMATION MANAGEMENT.—The Secretary shall ensure that all current information
of the Federal Crop Insurance Corporation and the Farm
Service Agency is combined, reconciled, redefined, and reformatted in such a manner so that the agencies can use the
common information management system developed under this
subsection.
(4) ASSISTANCE FOR DEVELOPMENT OF SYSTEM.—The Secretary shall enter into an agreement or contract with a nonFederal entity to assist the Secretary in the development of
the information management system. The Secretary shall give
preference in entering into an agreement or contract to entities
that have—
(A) prior experience with the information and management systems of the Federal Crop Insurance Corporation;
and

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note.
7 USC 8002.

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(B) collaborated with the Corporation in the development of the identification procedures required by section
515(f) of the Federal Crop Insurance Act (7 U.S.C. 1515(f)).
(5) USE.—The information collected using the information
management system developed under this subsection may be
made available to—
(A) any Federal agency that requires the information
to carry out the functions of the agency; and
(B) any approved insurance provider, as defined in
section 502(b) of the Federal Crop Insurance Act (7 U.S.C.
1502(b)), with respect to producers insured by the approved
insurance provider.
(6) RELATION TO OTHER ACTIVITIES.—This subsection shall
not interfere with, or delay, existing agreements or requests
for proposals of the Federal Crop Insurance Corporation or
the Farm Service Agency regarding the information management activities known as data mining or data warehousing.
(c) AUTHORIZATION OF APPROPRIATIONS.—In addition to
amounts made available under subsection (a)(3), there are authorized to be appropriated such sums as are necessary to carry out
subsection (b) for each of fiscal years 2003 through 2008.
SEC. 10707. OUTREACH AND ASSISTANCE FOR SOCIALLY DISADVANTAGED FARMERS AND RANCHERS.

(a) DEFINITIONS.—Section 2501(e) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e)) is amended
by adding at the end the following:
‘‘(4) DEPARTMENT.—The term ‘Department’ means the
Department of Agriculture.
‘‘(5) ELIGIBLE ENTITY.—The term ‘eligible entity’ means any
of the following:
‘‘(A) Any community-based organization, network, or
coalition of community-based organizations that—
‘‘(i) has demonstrated experience in providing agricultural education or other agriculturally related services to socially disadvantaged farmers and ranchers;
‘‘(ii) has provided to the Secretary documentary
evidence of work with socially disadvantaged farmers
and ranchers during the 2-year period preceding the
submission of an application for assistance under subsection (a); and
‘‘(iii) does not engage in activities prohibited under
section 501(c)(3) of the Internal Revenue Code of 1986.
‘‘(B) An 1890 institution or 1994 institution (as defined
in section 2 of the Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C. 7601)), including
West Virginia State College.
‘‘(C) An Indian tribal community college or an Alaska
Native cooperative college.
‘‘(D) An Hispanic-serving institution (as defined in section 1404 of the National Agricultural Research, Extension,
and Teaching Policy Act of 1977 (7 U.S.C. 3103)).
‘‘(E) Any other institution of higher education (as
defined in section 101 of the Higher Education Act of
1965 (20 U.S.C. 1001)) that has demonstrated experience
in providing agriculture education or other agriculturally

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related services to socially disadvantaged farmers and
ranchers in a region.
‘‘(F) An Indian tribe (as defined in section 4 of the
Indian Self-Determination and Education Assistance Act
(25 U.S.C. 450b)) or a national tribal organization that
has demonstrated experience in providing agriculture education or other agriculturally related services to socially
disadvantaged farmers and ranchers in a region.
‘‘(G) An organization or institution that received
funding under subsection (a) before January 1, 1996, but
only with respect to projects that the Secretary considers
are similar to projects previously carried out by the
organization or institution under such subsection.
‘‘(6) SECRETARY.—The term ‘Secretary’ means the Secretary
of Agriculture.’’.
(b) OUTREACH AND ASSISTANCE.—Section 2501 of the Food,
Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279)
is amended by striking subsection (a) and inserting the following:
‘‘(a) OUTREACH AND ASSISTANCE.—
‘‘(1) PROGRAM.—The Secretary of Agriculture shall carry
out an outreach and technical assistance program to encourage
and assist socially disadvantaged farmers and ranchers—
‘‘(A) in owning and operating farms and ranches; and
‘‘(B) in participating equitably in the full range of
agricultural programs offered by the Department.
‘‘(2) REQUIREMENTS.—The outreach and technical assistance program under paragraph (1) shall—
‘‘(A) enhance coordination of the outreach, technical
assistance, and education efforts authorized under various
agriculture programs; and
‘‘(B) include information on, and assistance with—
‘‘(i) commodity, conservation, credit, rural, and
business development programs;
‘‘(ii) application and bidding procedures;
‘‘(iii) farm and risk management;
‘‘(iv) marketing; and
‘‘(v) other activities essential to participation in
agricultural and other programs of the Department.
‘‘(3) GRANTS AND CONTRACTS.—
‘‘(A) IN GENERAL.—The Secretary may make grants
to, and enter into contracts and other agreements with,
an eligible entity to provide information and technical
assistance under this subsection.
‘‘(B) RELATIONSHIP TO OTHER LAW.—The authority to
carry out this section shall be in addition to any other
authority provided in this or any other Act.
‘‘(C) OTHER PROJECTS.—Notwithstanding paragraph
(1), the Secretary may make grants to, and enter into
contracts and other agreements with, an organization or
institution that received funding under this section before
January 1, 1996, to carry out a project that is similar
to a project for which the organization or institution
received such funding.
‘‘(4) FUNDING.—
‘‘(A) AUTHORIZATION OF APPROPRIATIONS.—There is
authorized to be appropriated to carry out this subsection
$25,000,000 for each of fiscal years 2002 through 2007.

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‘‘(B) INTERAGENCY FUNDING.—In addition to funds
authorized to be appropriated under subparagraph (A), any
agency of the Department may participate in any grant,
contract, or agreement entered into under this subsection
by contributing funds, if the agency determined that the
objectives of the grant, contract, or agreement will further
the authorized programs of the contributing agency.’’.
(c) CONFORMING AMENDMENTS.—Section 2501 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279) is
amended—
(1) in subsection (d)(1), by striking ‘‘of Agriculture’’ after
‘‘Department’’; and
(2) in subsection (g)(1), by striking ‘‘of Agriculture’’ after
‘‘Department’’.
SEC. 10708. TRANSPARENCY AND ACCOUNTABILITY FOR SOCIALLY DISADVANTAGED FARMERS AND RANCHERS; PUBLIC
DISCLOSURE REQUIREMENTS FOR COUNTY COMMITTEE
ELECTIONS.

(a) TRANSPARENCY AND
ADVANTAGED FARMERS AND

ACCOUNTABILITY FOR SOCIALLY DISRANCHERS.—The Food, Agriculture,
Conservation, and Trade Act of 1990 is amended by inserting after
section 2501 (7 U.S.C. 2279) the following:
7 USC 2279–1.

‘‘SEC. 2501A. TRANSPARENCY AND ACCOUNTABILITY FOR SOCIALLY
DISADVANTAGED FARMERS AND RANCHERS.

‘‘(a) PURPOSE.—The purpose of this section is to ensure compilation and public disclosure of data to assess and hold the Department
of Agriculture accountable for the nondiscriminatory participation
of socially disadvantaged farmers and ranchers in programs of
the Department.
‘‘(b) DEFINITION OF SOCIALLY DISADVANTAGED FARMER OR
RANCHER.—In this section, the term ‘socially disadvantaged farmer
or rancher’ has the meaning given the term in section 355(e) of
the Consolidated Farm and Rural Development Act (7 U.S.C.
2003(e)).
‘‘(c) COMPILATION OF PROGRAM PARTICIPATION DATA.—
‘‘(1) ANNUAL REQUIREMENT.—For each county and State
in the United States, the Secretary shall compute annually
the participation rate of socially disadvantaged farmers and
ranchers as a percentage of the total participation of all farmers
and ranchers for each program of the Department of Agriculture
established for farmers or ranchers.
‘‘(2) REPORTING PARTICIPATION.—In reporting the rates of
participation under paragraph (1), the Secretary shall report
the participation rate of socially disadvantaged farmers and
ranchers according to race, ethnicity, and gender.’’.
(b) PUBLIC DISCLOSURE REQUIREMENTS FOR COUNTY COMMITTEE ELECTIONS.—Section 8(b)(5) of the Soil Conservation and
Domestic Allotment Act (16 U.S.C. 590h(b)(5)) is amended by
striking subparagraph (B) and inserting the following:
‘‘(B) ESTABLISHMENT AND ELECTIONS FOR COUNTY,
AREA, OR LOCAL COMMITTEES.—
‘‘(i) ESTABLISHMENT.—
‘‘(I) IN GENERAL.—In each county or area in
which activities are carried out under this section,
the Secretary shall establish a county or area committee.

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‘‘(II) LOCAL ADMINISTRATIVE AREAS.—The Secretary may designate local administrative areas
within a county or a larger area under the jurisdiction of a committee established under subclause
(I).
‘‘(ii) COMPOSITION OF COUNTY, AREA, OR LOCAL
COMMITTEES.—A committee established under clause
(i) shall consist of not fewer than 3 nor more than
5 members that—
‘‘(I) are fairly representative of the agricultural
producers within the area covered by the county,
area, or local committee; and
‘‘(II) are elected by the agricultural producers
that participate or cooperate in programs administered within the area under the jurisdiction of
the county, area, or local committee.
‘‘(iii) ELECTIONS.—
‘‘(I) IN GENERAL.—Subject to subclauses (II)
through (V), the Secretary shall establish procedures for nominations and elections to county,
area, or local committees.
‘‘(II) NONDISCRIMINATION STATEMENT.—Each
solicitation of nominations for, and notice of elections of, a county, area, or local committee shall
include the nondiscrimination statement used by
the Secretary.
‘‘(III) NOMINATIONS.—
‘‘(aa) ELIGIBILITY.—To be eligible for
nomination and election to the applicable
county, area, or local committee, as determined by the Secretary, an agricultural producer shall be located within the area under
the jurisdiction of a county, area, or local committee, and participate or cooperate in programs administered within that area.
‘‘(bb) OUTREACH.—In addition to such
nominating procedures as the Secretary may
prescribe, the Secretary shall solicit and accept
nominations from organizations representing
the interests of socially disadvantaged groups
(as defined in section 355(e)(1) of the Consolidated Farm and Rural Development Act (7
U.S.C. 2003(e)(1)).
‘‘(IV) OPENING OF BALLOTS.—
‘‘(aa) PUBLIC NOTICE.—At least 10 days
before the date on which ballots are to be
opened and counted, a county, area, or local
committee shall announce the date, time, and
place at which election ballots will be opened
and counted.
‘‘(bb) OPENING OF BALLOTS.—Election ballots shall not be opened until the date and
time announced under item (aa).
‘‘(cc) OBSERVATION.—Any person may
observe the opening and counting of the election ballots.

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‘‘(V) REPORT OF ELECTION.—Not later than 20
days after the date on which an election is held,
a county, area, or local committee shall file an
election report with the Secretary and the State
office of the Farm Service Agency that includes—
‘‘(aa) the number of eligible voters in the
area covered by the county, area, or local committee;
‘‘(bb) the number of ballots cast in the
election by eligible voters (including the
percentage of eligible voters that cast ballots);
‘‘(cc) the number of ballots disqualified in
the election;
‘‘(dd) the percentage that the number of
ballots disqualified is of the number of ballots
received;
‘‘(ee) the number of nominees for each seat
up for election;
‘‘(ff) the race, ethnicity, and gender of each
nominee, as provided through the voluntary
self-identification of each nominee; and
‘‘(gg) the final election results (including
the number of ballots received by each
nominee).
‘‘(VI) NATIONAL REPORT.—Not later than 90
days after the date on which the first election
of a county, area, or local committee that occurs
after the date of enactment of the Farm Security
and Rural Investment Act of 2002 is held, the
Secretary shall complete a report that consolidates
all the election data reported to the Secretary
under subclause (V).
‘‘(VII) ELECTION REFORM.—
‘‘(aa) ANALYSIS.—If determined necessary
by the Secretary after analyzing the data contained in the report under subclause (VI), the
Secretary shall promulgate and publish in the
Federal Register proposed uniform guidelines
for conducting elections for members and alternate members of county, area, and local
committees not later than 1 year after the
date of completion of the report.
‘‘(bb) INCLUSION.—The procedures promulgated by the Secretary under item (aa) shall
ensure fair representation of socially disadvantaged groups described in subclause (III)(bb)
in an area covered by the county, area, or
local committee, in cases in which those groups
are underrepresented on the county, area, or
local committee for that area.
‘‘(cc) METHODS OF INCLUSION.—Notwithstanding clause (ii), the Secretary may ensure
inclusion of socially disadvantaged farmers
and ranchers through provisions allowing for
appointment of 1 additional voting member
to a county, area, or local committee or
through other methods.

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‘‘(iv) TERM OF OFFICE.—The term of office for a
member of a county, area, or local committee shall
not exceed 3 years.
‘‘(v) PUBLIC AVAILABILITY AND REPORT TO CONGRESS.—
‘‘(I) PUBLIC DISCLOSURE.—The Secretary shall
maintain and make readily available to the public,
via website and otherwise in electronic and paper
form, all data required to be collected and computed under section 2501A(c) of the Food, Agriculture, Conservation, and Trade Act of 1990 and
clause (iii)(V) collected annually since the most
recent Census of Agriculture.
‘‘(II) REPORT TO CONGRESS.—After each Census
of Agriculture, the Secretary shall report to Congress the rate of loss or gain in participation by
each socially disadvantaged group, by race, ethnicity, and gender, since the previous Census.’’.

Internet.

Subtitle I—General Provisions
SEC. 10801. COTTON CLASSIFICATION SERVICES.

(a) EXTENSION OF AUTHORITY TO PROVIDE SERVICES.—The first
sentence of section 3a of the Act of March 3, 1927 (commonly
known as the ‘‘Cotton Statistics and Estimates Act’’; 7 U.S.C. 473a),
is amended by striking ‘‘2002’’ and inserting ‘‘2007’’.
(b) REPEAL OF OBSOLETE EFFECTIVE DATE PROVISIONS.—
(1) 1984 AMENDMENT.—The first section of Public Law 98–
403 (98 Stat. 1479) is amended by striking ‘‘, effective for
the period beginning October 1, 1984, and ending September
30, 1988,’’.
(2) 1987 AMENDMENTS.—Section 2 of the Uniform Cotton
Classing Fees Act of 1987 (Public Law 100–108; 101 Stat.
728) is amended by striking ‘‘Effective for the period beginning
on the date of enactment of this Act and ending September
30, 1992, section’’ and inserting ‘‘Section’’.
(3) 1991 AMENDMENTS.—Section 120 of the Food, Agriculture, Conservation, and Trade Act Amendments of 1991
(Public Law 102–237; 105 Stat. 1842) is amended by striking
subsection (e).

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7 USC 473a note.

7 USC 473a note.

7 USC 473a note.

SEC. 10802. PROGRAM OF PUBLIC EDUCATION REGARDING USE OF
BIOTECHNOLOGY IN PRODUCING FOOD FOR HUMAN
CONSUMPTION.

7 USC 5921a.

(a) PUBLIC INFORMATION CAMPAIGN.—Not later than 1 year
after the date of enactment of this Act, the Secretary of Agriculture
shall develop and implement a program to communicate with the
public regarding the use of biotechnology in producing food for
human consumption. The information provided under the program
shall include the following:
(1) Science-based evidence on the safety of foods produced
with biotechnology.
(2) Scientific data on the human outcomes of the use of
biotechnology to produce food for human consumption.

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(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 2002 through 2007.
SEC. 10803. CHINO DAIRY PRESERVE PROJECT.

Notwithstanding any other provision of law, the Secretary of
Agriculture, acting through the Natural Resources Conservation
Service, may provide financial and technical assistance to the Chino
Dairy Preserve Project, San Bernadino County, California.
SEC. 10804. GRAZINGLANDS RESEARCH LABORATORY.

Notwithstanding any other provision of law, before December
31, 2007, the Federal land and facilities at El Reno, Oklahoma,
currently administered by the Secretary of Agriculture as the
Grazinglands Research Laboratory shall not, without specific
authorization by Congress—
(1) be declared to be excess or surplus under the Federal
Property and Administrative Services Act of 1949 (40 U.S.C.
471 et seq.); or
(2) be conveyed or otherwise transferred in whole or in
part.
SEC. 10805. FOOD AND AGRICULTURAL POLICY RESEARCH INSTITUTE.

(a) AUTHORITY.—The Secretary of Agriculture may award
grants to the Food and Agricultural Policy Research Institute for
the purpose of funding prospective, independent research on the
effects of alternative domestic, foreign, and trade policies, on the
agricultural sector, including research on the effects of those policies
on—
(1) commodity prices for—
(A) feed; and
(B) food grains, oilseeds, cotton, livestock, and products
thereof;
(2) supply and demand conditions for similar products;
(3) costs to the Federal Government;
(4) farm income;
(5) food costs;
(6) the volume and value of trade in agricultural commodities; and
(7) exporter and importer supply, demand, and trade.
(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $6,000,000 for each
of fiscal years 2003 through 2007.
21 USC 321d.

SEC. 10806. MARKET NAMES FOR CATFISH AND GINSENG.

(a) CATFISH LABELING.—
(1) IN GENERAL.—Notwithstanding any other provision of
law, for purposes of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 301 et seq.)—
(A) the term ‘‘catfish’’ may only be considered to be
a common or usual name (or part thereof) for fish classified
within the family Ictaluridae; and
(B) only labeling or advertising for fish classified within
that family may include the term ‘‘catfish’’.
(2) AMENDMENT.—Section 403 of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 343) is amended by adding at
the end the following:

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‘‘(t) If it purports to be or is represented as catfish, unless
it is fish classified within the family Ictaluridae.’’.
(b) GINSENG LABELING.—
(1) IN GENERAL.—Notwithstanding any other provision of
law, for purposes of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 301 et seq.)—
(A) the term ‘‘ginseng’’ may only be considered to be
a common or usual name (or part thereof) for any herb
or herbal ingredient derived from a plant classified within
the genus Panax; and
(B) only labeling or advertising for herbs or herbal
ingredients classified within that genus may include the
term ‘‘ginseng’’.
(2) AMENDMENT.—Section 403 of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 343) (as amended by subsection
(a)(2)) is amended by adding at the end the following:
‘‘(u) If it purports to be or is represented as ginseng, unless
it is an herb or herbal ingredient derived from a plant classified
within the genus Panax.’’.
SEC. 10807. FOOD SAFETY COMMISSION.

21 USC 341 note.

(a) ESTABLISHMENT.—
(1) IN GENERAL.—There is established a commission to
be known as the ‘‘Food Safety Commission’’ (referred to in
this section as the ‘‘Commission’’).
(2) MEMBERSHIP.—
(A) COMPOSITION.—The Commission shall be composed
of 15 members (including a Chairperson, appointed by the
President.
(B) ELIGIBILITY.—
(i) IN GENERAL.—Members of the Commission—
(I) shall have specialized training or significant experience in matters under the jurisdiction
of the Commission; and
(II) shall represent, at a minimum—
(aa) consumers;
(bb) food scientists;
(cc) the food industry; and
(dd) health professionals.
(ii) FEDERAL EMPLOYEES.—Not more than 3 members of the Commission may be Federal employees.
(C) DATE OF APPOINTMENTS.—The appointment of the
members of the Commission shall be made as soon as
practicable after the date on which funds authorized to
be appropriated under subsection (e)(1) are made available.
(D) VACANCIES.—A vacancy on the Commission—
(i) shall not affect the powers of the Commission;
and
(ii) shall be filled—
(I) not later than 60 days after the date on
which the vacancy occurs; and
(II) in the same manner as the original
appointment was made.
(3) MEETINGS.—
(A) INITIAL MEETING.—The initial meeting of the
Commission shall be conducted not later than 30 days

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after the date of appointment of the final member of the
Commission.
(B) OTHER MEETINGS.—The Commission shall meet at
the call of the Chairperson.
(4) QUORUM; STANDING RULES.—
(A) QUORUM.—A majority of the members of the
Commission shall constitute a quorum to conduct business.
(B) STANDING RULES.—At the first meeting of the
Commission, the Commission shall adopt standing rules
of the Commission to guide the conduct of business and
decisionmaking of the Commission.
(b) DUTIES.—
(1) RECOMMENDATIONS.—The Commission shall make specific recommendations to enhance the food safety system of
the United States, including a description of how each recommendation would improve food safety.
(2) COMPONENTS.—Recommendations made by the Commission under paragraph (1) shall address all food available
commercially in the United States.
(3) REPORT.—Not later than 1 year after the date on which
the Commission first meets, the Commission shall submit to
the President and Congress—
(A) the findings, conclusions, and recommendations of
the Commission, including a description of how each recommendation would improve food safety;
(B) a summary of any other material used by the
Commission in the preparation of the report under this
paragraph; and
(C) if requested by 1 or more members of the Commission, a statement of the minority views of the Commission.
(c) POWERS OF THE COMMISSION.—
(1) HEARINGS.—The Commission may, for the purpose of
carrying out this section, hold such hearings, meet and act
at such times and places, take such testimony, and receive
such evidence as the Commission considers advisable.
(2) INFORMATION FROM FEDERAL AGENCIES.—
(A) IN GENERAL.—The Commission may secure directly,
from any Federal agency, such information as the Commission considers necessary to carry out this section.
(B) PROVISION OF INFORMATION.—
(i) IN GENERAL.—Subject to subparagraph (C), on
the request of the Commission, the head of a Federal
agency described in subparagraph (A) may furnish
information requested by the Commission to the
Commission.
(ii) ADMINISTRATION.—The furnishing of information by a Federal agency to the Commission shall not
be considered a waiver of any exemption available
to the agency under section 552 of title 5, United
States Code.
(C) INFORMATION TO BE KEPT CONFIDENTIAL.—
(i) IN GENERAL.—For purposes of section 1905 of
title 18, United States Code—
(I) the Commission shall be considered an
agency of the Federal Government; and
(II) any individual employed by an individual,
entity, or organization that is a party to a contract

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with the Commission under this section shall be
considered an employee of the Commission.
(ii) PROHIBITION ON DISCLOSURE.—Information
obtained by the Commission, other than information
that is available to the public, shall not be disclosed
to any person in any manner except to an employee
of the Commission as described in clause (i), for the
purpose of receiving, reviewing, or processing the
information.
(d) COMMISSION PERSONNEL MATTERS.—
(1) MEMBERS.—
(A) COMPENSATION.—A member of the Commission
shall serve without compensation for the services of the
member on the Commission.
(B) TRAVEL EXPENSES.—A member of the Commission
shall be allowed travel expenses, including per diem in
lieu of subsistence, at rates authorized for an employee
of an agency under subchapter I of chapter 57 of title
5, United States Code, while away from the home or regular
place of business of the member in the performance of
the duties of the Commission.
(2) STAFF.—
(A) IN GENERAL.—The Chairperson of the Commission
may, without regard to the civil service laws (including
regulations), appoint and terminate the appointment of
an executive director and such other additional personnel
as are necessary to enable the Commission to perform
the duties of the Commission.
(B) CONFIRMATION OF EXECUTIVE DIRECTOR.—The
employment of an executive director shall be subject to
confirmation by the Commission.
(C) COMPENSATION.—
(i) IN GENERAL.—Except as provided in clause (ii),
the Chairperson of the Commission may fix the compensation of the executive director and other personnel
without regard to the provisions of chapter 51 and
subchapter III of chapter 53 of title 5, United States
Code, relating to classification of positions and General
Schedule pay rates.
(ii) MAXIMUM RATE OF PAY.—The rate of pay for
the executive director and other personnel shall not
exceed the rate payable for level II of the Executive
Schedule under section 5316 of title 5, United States
Code.
(3) DETAIL OF FEDERAL GOVERNMENT EMPLOYEES.—
(A) IN GENERAL.—An employee of the Federal Government may be detailed to the Commission, without
reimbursement, for such period of time as is permitted
by law.
(B) CIVIL SERVICE STATUS.—The detail of the employee
shall be without interruption or loss of civil service status
or privilege.
(4) PROCUREMENT OF TEMPORARY AND INTERMITTENT SERVICES.—The Chairperson of the Commission may procure temporary and intermittent services in accordance with section
3109(b) of title 5, United States Code, at rates for individuals
that do not exceed the daily equivalent of the annual rate

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of basic pay prescribed for level II of the Executive Schedule
under section 5316 of that title.
(e) AUTHORIZATION OF APPROPRIATIONS.—
(1) IN GENERAL.—There is authorized to be appropriated
such sums as are necessary to carry out this section.
(2) LIMITATION.—No payment may be made under subsection (d) except to the extent provided for in advance in
an appropriations Act.
(f) TERMINATION.—The Commission shall terminate on the date
that is 60 days after the date on which the Commission submits
the recommendations and report under subsection (b)(3).
SEC. 10808. PASTEURIZATION.

21 USC 679b.
Effective date.
Deadline.

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(a) PASTEURIZATION OF MEAT AND POULTRY.—
(1) IN GENERAL.—Effective beginning not later than 30
days after the date of enactment of this Act, the Secretary
of Agriculture shall conduct an education program regarding
the availability and safety of processes and treatments that
eliminate or substantially reduce the level of pathogens on
meat, meat food products, poultry, and poultry products.
(2) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated such sums as are necessary to carry
out this subsection.
(b) PASTEURIZATION OF FOOD AS PASTEURIZED.—Section 403(h)
of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 343(h))
is amended—
(1) by striking ‘‘or’’ at the end of paragraph (1);
(2) by striking the period at the end of paragraph (2)
and inserting ‘‘; or’’; and
(3) by adding at the end the following:
‘‘(3) a food that is pasteurized unless—
‘‘(A) such food has been subjected to a safe process
or treatment that is prescribed as pasteurization for such
food in a regulation promulgated under this Act; or
‘‘(B)(i) such food has been subjected to a safe process
or treatment that—
‘‘(I) is reasonably certain to achieve destruction
or elimination in the food of the most resistant microorganisms of public health significance that are likely
to occur in the food;
‘‘(II) is at least as protective of the public health
as a process or treatment described in subparagraph
(A);
‘‘(III) is effective for a period that is at least as
long as the shelf life of the food when stored under
normal and moderate abuse conditions; and
‘‘(IV) is the subject of a notification to the Secretary, including effectiveness data regarding the
process or treatment; and
‘‘(ii) at least 120 days have passed after the date of
receipt of such notification by the Secretary without the
Secretary making a determination that the process or treatment involved has not been shown to meet the requirements of subclauses (I) through (III) of clause (i).

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For purposes of paragraph (3), a determination by the Secretary
that a process or treatment has not been shown to meet the requirements of subclauses (I) through (III) of subparagraph (B)(i) shall
constitute final agency action under such subclauses.’’.
SEC. 10809. RULEMAKING ON LABELING OF IRRADIATED FOOD; CERTAIN PETITIONS.

The Secretary of Health and Human Services (referred to in
this section as the ‘‘Secretary’’) shall publish a proposed rule and,
with due consideration to public comment, a final rule to revise,
as appropriate, the current regulation governing the labeling of
foods that have been treated to reduce pest infestation or pathogens
by treatment by irradiation using radioactive isotope, electronic
beam, or x-ray. Pending promulgation of the final rule required
by this subsection, any person may petition the Secretary for
approval of labeling, which is not false or misleading in any material
respect, of a food which has been treated by irradiation using
radioactive isotope, electronic beam, or x-ray. The Secretary shall
approve or deny such a petition within 180 days of receipt of
the petition, or the petition shall be deemed denied, except to
the extent additional agency review is mutually agreed upon by
the Secretary and the petitioner. Any denial of a petition under
this subsection shall constitute final agency action subject to judicial
review by the United States Court of Appeals for the District
of Columbia Circuit. Any labeling approved through the foregoing
petition process shall be subject to the provisions of the final rule
referred to in the first sentence of the subparagraph on the effective
date of such final rule.

21 USC 343 note.

Deadline.

SEC. 10810. PENALTIES FOR VIOLATIONS OF PLANT PROTECTION ACT.

Section 424 of the Plant Protection Act (7 U.S.C. 7734) is
amended by striking subsection (a) and inserting the following:
‘‘(a) CRIMINAL PENALTIES.—
‘‘(1) OFFENSES.—
‘‘(A) IN GENERAL.—A person that knowingly violates
this title, or knowingly forges, counterfeits, or, without
authority from the Secretary, uses, alters, defaces, or
destroys any certificate, permit, or other document provided
for in this title shall be fined under title 18, United States
Code, imprisoned not more than 1 year, or both.
‘‘(B) MOVEMENT.—A person that knowingly imports,
enters, exports, or moves any plant, plant product,
biological control organism, plant pest, noxious weed, or
article, for distribution or sale, in violation of this title,
shall be fined under title 18, United States Code, imprisoned not more than 5 years, or both.
‘‘(2) MULTIPLE VIOLATIONS.—On the second and any subsequent conviction of a person of a violation of this title under
paragraph (1), the person shall be fined under title 18, United
States Code, imprisoned not more than 10 years, or both.’’.
SEC. 10811. PRECLEARANCE QUARANTINE INSPECTIONS.

7 USC 8307 note.

(a) PRECLEARANCE INSPECTIONS REQUIRED.—The Secretary of
Agriculture, acting through the Administrator of the Animal and
Plant Health Inspection Service, shall conduct preclearance quarantine inspections of persons, baggage, cargo, and any other articles
destined for movement from the State of Hawaii to any of the
following—

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(1) The continental United States.
(2) Guam.
(3) Puerto Rico.
(4) The United States Virgin Islands.
(b) INSPECTION LOCATIONS.—The preclearance quarantine
inspections required by subsection (a) shall be conducted at all
direct departure and interline airports in the State of Hawaii.
(c) LIMITATION.—The Secretary shall not implement this section
unless appropriations for necessary expenses of the Animal and
Plant Health Inspection Service for inspection, quarantine, and
regulatory activities are increased by an amount not less than
$3,000,000 in an Act making appropriations for fiscal year 2003.
SEC. 10812. CONNECTICUT RIVER ATLANTIC SALMON COMMISSION.

Section 3(2) of Public Law 98–138 (Public Law 98–138; 97
Stat. 870) is amended by striking ‘‘twenty’’ and inserting ‘‘40’’.
SEC. 10813. PINE POINT SCHOOL.
115 Stat. 1949.

Section 802(b)(2) of the No Child Left Behind Act of 2001
(Public Law 107–110) is amended by striking ‘‘2002’’ each place
it appears and inserting ‘‘2000’’.
SEC. 10814. 7-MONTH EXTENSION OF CHAPTER 12 OF TITLE 11 OF THE
UNITED STATES CODE.

11 USC 1201
note.

(a) AMENDMENTS.—Section 149 of title I of division C of Public
Law 105–277 is amended—
(1) by striking ‘‘June 1, 2002’’ each place it appears and
inserting ‘‘January 1, 2003’’; and
(2) in subsection (a)—
(A) by striking ‘‘September 30, 2001’’ and inserting
‘‘May 31, 2002’’; and
(B) by striking ‘‘October 1, 2001’’ and inserting ‘‘June
1, 2002’’.
(b) EFFECTIVE DATE.—The amendments made by subsection
(a) shall take effect on June 1, 2002.

7 USC 1967.

SEC. 10815. PRACTICES INVOLVING NONAMBULATORY LIVESTOCK.

11 USC
1201–1208,
1221–1231,
1201 note.

Applicability.

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(a) REPORT.—The Secretary of Agriculture shall investigate and
submit to Congress a report on—
(1) the scope of nonambulatory livestock;
(2) the causes that render livestock nonambulatory;
(3) the humane treatment of nonambulatory livestock; and
(4) the extent to which nonambulatory livestock may
present handling and disposition problems for stockyards,
market agencies, and dealers.
(b) AUTHORITY.—Based on the findings of the report, if the
Secretary determines it necessary, the Secretary shall promulgate
regulations to provide for the humane treatment, handling, and
disposition of nonambulatory livestock by stockyards, market agencies, and dealers.
(c) ADMINISTRATION AND ENFORCEMENT.—For the purpose of
administering and enforcing any regulations promulgated under
subsection (b), the authorities provided under sections 10414 and
10415 shall apply to the regulations in a similar manner as those
sections apply to the Animal Health Protection Act. Any person
that violates regulations promulgated under subsection (b) shall
be subject to penalties provided in section 10414.

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116 STAT. 533

SEC. 10816. COUNTRY OF ORIGIN LABELING.

The Agricultural Marketing Act of 1946 (7 U.S.C. 1621 et
seq.) is amended by adding at the end the following:

‘‘Subtitle D—Country of Origin Labeling
7 USC 1638.

‘‘SEC. 281. DEFINITIONS.

‘‘In this subtitle:
‘‘(1) BEEF.—The term ‘beef’ means meat produced from
cattle (including veal).
‘‘(2) COVERED COMMODITY.—
‘‘(A) IN GENERAL.—The term ‘covered commodity’
means—
‘‘(i) muscle cuts of beef, lamb, and pork;
‘‘(ii) ground beef, ground lamb, and ground pork;
‘‘(iii) farm-raised fish;
‘‘(iv) wild fish;
‘‘(v) a perishable agricultural commodity; and
‘‘(vi) peanuts.
‘‘(B) EXCLUSIONS.—The term ‘covered commodity’ does
not include an item described in subparagraph (A) if the
item is an ingredient in a processed food item.
‘‘(3) FARM-RAISED FISH.—The term ‘farm-raised fish’
includes—
‘‘(A) farm-raised shellfish; and
‘‘(B) fillets, steaks, nuggets, and any other flesh from
a farm-raised fish or shellfish.
‘‘(4) FOOD SERVICE ESTABLISHMENT.—The term ‘food service
establishment’ means a restaurant, cafeteria, lunch room, food
stand, saloon, tavern, bar, lounge, or other similar facility operated as an enterprise engaged in the business of selling food
to the public.
‘‘(5) LAMB.—The term ‘lamb’ means meat, other than
mutton, produced from sheep.
‘‘(6) PERISHABLE AGRICULTURAL COMMODITY; RETAILER.—
The terms ‘perishable agricultural commodity’ and ‘retailer’
have the meanings given the terms in section 1(b) of the Perishable Agricultural Commodities Act of 1930 (7 U.S.C. 499a(b)).
‘‘(7) PORK.—The term ‘pork’ means meat produced from
hogs.
‘‘(8) SECRETARY.—The term ‘Secretary’ means the Secretary
of Agriculture, acting through the Agricultural Marketing
Service.
‘‘(9) WILD FISH.—
‘‘(A) IN GENERAL.—The term ‘wild fish’ means naturally-born or hatchery-raised fish and shellfish harvested
in the wild.
‘‘(B) INCLUSIONS.—The term ‘wild fish’ includes a fillet,
steak, nugget, and any other flesh from wild fish or shellfish.
‘‘(C) EXCLUSIONS.—The term ‘wild fish’ excludes netpen aquacultural or other farm-raised fish.
‘‘SEC. 282. NOTICE OF COUNTRY OF ORIGIN.

7 USC 1638a.

‘‘(a) IN GENERAL.—

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‘‘(1) REQUIREMENT.—Except as provided in subsection (b),
a retailer of a covered commodity shall inform consumers, at
the final point of sale of the covered commodity to consumers,
of the country of origin of the covered commodity.
‘‘(2) UNITED STATES COUNTRY OF ORIGIN.—A retailer of a
covered commodity may designate the covered commodity as
having a United States country of origin only if the covered
commodity—
‘‘(A) in the case of beef, is exclusively from an animal
that is exclusively born, raised, and slaughtered in the
United States (including from an animal exclusively born
and raised in Alaska or Hawaii and transported for a
period not to exceed 60 days through Canada to the United
States and slaughtered in the United States);
‘‘(B) in the case of lamb and pork, is exclusively from
an animal that is exclusively born, raised, and slaughtered
in the United States;
‘‘(C) in the case of farm-raised fish, is hatched, raised,
harvested, and processed in the United States;
‘‘(D) in the case of wild fish, is—
‘‘(i) harvested in waters of the United States, a
territory of the United States, or a State; and
‘‘(ii) processed in the United States, a territory
of the United States, or a State, including the waters
thereof; and
‘‘(E) in the case of a perishable agricultural commodity
or peanuts, is exclusively produced in the United States.
‘‘(3) WILD FISH AND FARM-RAISED FISH.—The notice of
country of origin for wild fish and farm-raised fish shall distinguish between wild fish and farm-raised fish.
‘‘(b) EXEMPTION FOR FOOD SERVICE ESTABLISHMENTS.—Subsection (a) shall not apply to a covered commodity if the covered
commodity is—
‘‘(1) prepared or served in a food service establishment;
and
‘‘(2)(A) offered for sale or sold at the food service establishment in normal retail quantities; or
‘‘(B) served to consumers at the food service establishment.
‘‘(c) METHOD OF NOTIFICATION.—
‘‘(1) IN GENERAL.—The information required by subsection
(a) may be provided to consumers by means of a label, stamp,
mark, placard, or other clear and visible sign on the covered
commodity or on the package, display, holding unit, or bin
containing the commodity at the final point of sale to consumers.
‘‘(2) LABELED COMMODITIES.—If the covered commodity is
already individually labeled for retail sale regarding country
of origin, the retailer shall not be required to provide any
additional information to comply with this section.
‘‘(d) AUDIT VERIFICATION SYSTEM.—The Secretary may require
that any person that prepares, stores, handles, or distributes a
covered commodity for retail sale maintain a verifiable recordkeeping audit trail that will permit the Secretary to verify compliance with this subtitle (including the regulations promulgated under
section 284(b)).
‘‘(e) INFORMATION.—Any person engaged in the business of supplying a covered commodity to a retailer shall provide information

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to the retailer indicating the country of origin of the covered commodity.
‘‘(f) CERTIFICATION OF ORIGIN.—
‘‘(1) MANDATORY IDENTIFICATION.—The Secretary shall not
use a mandatory identification system to verify the country
of origin of a covered commodity.
‘‘(2) EXISTING CERTIFICATION PROGRAMS.—To certify the
country of origin of a covered commodity, the Secretary may
use as a model certification programs in existence on the date
of enactment of this Act, including—
‘‘(A) the carcass grading and certification system carried out under this Act;
‘‘(B) the voluntary country of origin beef labeling
system carried out under this Act;
‘‘(C) voluntary programs established to certify certain
premium beef cuts;
‘‘(D) the origin verification system established to carry
out the child and adult care food program established under
section 17 of the Richard B. Russell National School Lunch
Act (42 U.S.C. 1766); or
‘‘(E) the origin verification system established to carry
out the market access program under section 203 of the
Agricultural Trade Act of 1978 (7 U.S.C. 5623).
‘‘SEC. 283. ENFORCEMENT.

7 USC 1638b.

‘‘(a) IN GENERAL.—Except as provided in subsections (b) and
(c), section 253 shall apply to a violation of this subtitle.
‘‘(b) WARNINGS.—If the Secretary determines that a retailer
is in violation of section 282, the Secretary shall—
‘‘(1) notify the retailer of the determination of the Secretary;
and
‘‘(2) provide the retailer a 30-day period, beginning on
the date on which the retailer receives the notice under paragraph (1) from the Secretary, during which the retailer may
take necessary steps to comply with section 282.
‘‘(c) FINES.—If, on completion of the 30-day period described
in subsection (b)(2), the Secretary determines that the retailer
has willfully violated section 282, after providing notice and an
opportunity for a hearing before the Secretary with respect to
the violation, the Secretary may fine the retailer in an amount
of not more than $10,000 for each violation.

Applicability.

‘‘SEC. 284. REGULATIONS.

Deadlines.
7 USC 1638c.

‘‘(a) GUIDELINES.—Not later than September 30, 2002, the Secretary shall issue guidelines for the voluntary country of origin
labeling of covered commodities based on the requirements of section 282.
‘‘(b) REGULATIONS.—Not later than September 30, 2004, the
Secretary shall promulgate such regulations as are necessary to
implement this subtitle.
‘‘(c) PARTNERSHIPS WITH STATES.—In promulgating the regulations, the Secretary shall, to the maximum extent practicable, enter
into partnerships with States with enforcement infrastructure to
assist in the administration of this subtitle.
‘‘SEC. 285. APPLICABILITY.

‘‘This subtitle shall apply to the retail sale of a covered commodity beginning September 30, 2004.’’.

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Effective date.
7 USC 1638d.

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Subtitle J—Miscellaneous Studies and
Reports

Deadlines.

7 USC 612c note.

SEC. 10901. REPORT ON SPECIALTY CROP PURCHASES.

Not later than 1 year after the date of enactment of this
Act, the Secretary of Agriculture shall submit to the Committee
on Agriculture of the House of Representatives and the Committee
on Agriculture, Nutrition, and Forestry of the Senate a report
on the quantity and type of—
(1) fruits, vegetables, and other specialty food crops that
are purchased under section 10603; and
(2) other commodities that are purchased under section
32 of the Act of August 24, 1935 (7 U.S.C. 612c).
SEC. 10902. REPORT ON POUCHED AND CANNED SALMON.

(a) IN GENERAL.—Not later than 180 days after the date of
enactment of this Act, the Secretary of Agriculture shall submit
to Congress a report on efforts to expand the promotion, marketing,
and purchasing of pouched and canned salmon harvested and processed in the United States under food and nutrition programs
administered by the Secretary.
(b) COMPONENTS.—The report under subsection (a) shall
include—
(1) an analysis of pouched and canned salmon inventories
in the United States that, as of the date on which the report
is submitted, are available for purchase;
(2) an analysis of the demand for pouched and canned
salmon and value-added products (such as salmon ‘‘nuggets’’)
by—
(A) partners of the Department of Agriculture
(including other appropriate Federal agencies); and
(B) consumers; and
(3) an analysis of impediments to additional purchases
of pouched and canned salmon, including—
(A) any marketing issues; and
(B) recommendations for methods to resolve those
impediments.
SEC. 10903. STUDY ON UPDATING YIELDS.

(a) IN GENERAL.—The Comptroller General shall conduct a
study and make findings and recommendations with respect to
determining how producer income would be affected by updating
yield bases, including—
(1) whether crop yields have increased over the past 20
crop years for program crops and oilseeds;
(2) whether program payments would be disbursed differently under title I if yield bases were updated further;
(3) what impact the target prices under title I would have
on producer income if the yield bases of the target prices
were further updated; and
(4) what impact lower target prices with updated yield
bases would have on producer income, as compared with the
impact of target prices under title I.
(b) REPORT.—Not later than 180 days after the date of enactment of this Act, the Comptroller General shall submit to Congress

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a report on the study, findings, and recommendations required
by subsection (a).
SEC. 10904. REPORT ON EFFECT OF FARM PROGRAM PAYMENTS.

(a) IN GENERAL.—The Secretary of Agriculture shall conduct
a review of the effects that payments under production flexibility
contracts and market loss assistance payments have had, and that
direct payments and counter-cyclical payments are likely to have,
on the economic viability of producers and the farming infrastructure, particularly in areas where climate, soil types, and other
agronomic conditions severely limit the covered crops that producers
can choose to successfully and profitably produce.
(b) CASE STUDY RELATED TO RICE PRODUCTION.—The review
shall include a case study of the effects that the payments described
in subsection (a), and the forecast effects of increasing these or
other fixed payments, are likely to have on rice producers (including
tenant rice producers), the rice milling industry, and the economies
of rice farming areas in Texas, where harvested rice acreage has
fallen from 320,000 acres in 1995 to only 211,000 acres in 2001.
(c) REPORT AND RECOMMENDATIONS.—
(1) REPORT.—Not later than 90 days after the date of
the enactment of this Act, the Secretary shall submit to the
Committee on Agriculture of the House of Representatives and
the Committee on Agriculture, Nutrition, and Forestry of the
Senate a report describing the information collected for the
review and the case study and any findings made on the basis
of the information.
(2) RECOMMENDATIONS.—The report shall include recommendations for minimizing the adverse effects on producers,
with a special focus on—
(A) producers who are tenants;
(B) the agricultural economies in farming areas generally;
(C) particular areas described in subsection (a); and
(D) on the area that is the subject of the case study
conducted under subsection (b).
SEC. 10905. CHILOQUIN DAM FISH PASSAGE FEASIBILITY STUDY.

Oregon.

(a) IN GENERAL.—The Secretary of the Interior, in collaboration
with all interested parties (including the Modoc Point Irrigation
District, the Klamath Tribes, and the Oregon Department of Fish
and Wildlife), shall conduct a study of the feasibility of providing
adequate upstream and downstream passage for fish at the
Chiloquin Dam on the Sprague River, Oregon.
(b) SUBJECTS.—The study shall include—
(1) a review of all alternatives for providing passage
described in subsection (a), including the removal of the dam;
(2) the determination of the most appropriate alternative;
(3) the development of recommendations for implementing
that alternative; and
(4) examination of mitigation needed for upstream and
downstream water users, and for Klamath tribal nonconsumptive uses, as a result of the implementation of the alternative.
(c) REPORT.—Not later than 1 year after the date of enactment
of this Act, the Secretary of the Interior shall submit to Congress
a report that describes the findings, conclusions, and recommendations of the study.

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116 STAT. 538
7 USC 2204 note.

PUBLIC LAW 107–171—MAY 13, 2002

SEC. 10906. REPORT ON GEOGRAPHICALLY DISADVANTAGED FARMERS
AND RANCHERS.

(a) DEFINITION OF GEOGRAPHICALLY DISADVANTAGED FARMER
RANCHER.—In this section, the term ‘‘geographically disadvantaged farmer or rancher’ means a farmer or rancher in—
(1) an insular area (as defined in section 1404 of the
National Agricultural Research, Extension, and Teaching Policy
Act of 1977 (7 U.S.C. 3103) (as amended by section 7502(a));
or
(2) a State other than 1 of the 48 contiguous States.
(b) REPORT.—Not later than 1 year after the date of enactment
of this Act, the Secretary of Agriculture shall submit to the Committee on Agriculture of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the Senate
a report that describes—
(1) barriers to efficient and competitive transportation of
inputs and products by geographically disadvantaged farmers
and ranchers; and
(2) means of encouraging and assisting geographically disadvantaged farmers and ranchers—
(A) to own and operate farms and ranches; and
(B) to participate equitably in the full range of agricultural programs offered by the Department of Agriculture.
OR

7 USC 3191 note.

SEC. 10907. STUDIES ON AGRICULTURAL RESEARCH AND TECHNOLOGY.

(a) SCIENTIFIC STUDIES.—
(1) IN GENERAL.—The Secretary of Agriculture may conduct
scientific studies on—
(A) the transmission of spongiform encephalopathy in
deer, elk, and moose; and
(B) chronic wasting disease (including the risks that
chronic wasting disease poses to livestock).
(2) REPORT.—The Secretary shall submit to the Committee
on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate
a report on the results of any scientific studies conducted under
paragraph (1).
(b) VACCINES.—
(1) VACCINE STORAGE STUDY.—The Secretary may—
(A) conduct a study to determine the number of doses
of livestock disease vaccines that should be available to
protect against livestock diseases that could be introduced
into the United States; and
(B) compare that number with the number of doses
of the livestock disease vaccines that are available as of
that date.
(2) STOCKPILING OF VACCINES.—If, after conducting the
study and comparison described in paragraph (1), the Secretary
determines that there is an insufficient number of doses of
a particular vaccine referred to in that paragraph, the Secretary
may take such actions as are necessary to obtain the required
additional doses of the vaccine.
31 USC 712 note.

SEC. 10908. REPORT ON TOBACCO SETTLEMENT AGREEMENT.

Not later than December 31, 2002, and annually thereafter
through 2006, the Comptroller General shall submit to Congress

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a report that describes all programs and activities that States
have carried out using funds received under all phases of the
Master Settlement Agreement of 1997.
SEC. 10909. REPORT ON SALE AND USE OF PESTICIDES FOR AGRICULTURAL USES.

Not later than 180 days after the date of enactment of this
Act, the Administrator of the Environmental Protection Agency
shall submit to the Committee on Agriculture of the House of
Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate a report on the manner in which the Agency
is applying regulations of the Agency governing the sale and use
of pesticides for agricultural use to electronic commerce transactions.
SEC. 10910. REVIEW OF OPERATION OF AGRICULTURAL AND NATURAL
RESOURCE PROGRAMS ON TRIBAL TRUST LAND.

7 USC 2204 note.

(a) REVIEW.—The Secretary of Agriculture (referred to in this
section as the ‘‘Secretary’’) shall conduct a review of the operation
of agricultural and natural resource programs available to farmers
and ranchers operating on tribal and trust land, including—
(1) agricultural commodity, price support, and farm income
support programs (collectively referred to in this section as
‘‘agricultural commodity programs’’);
(2) conservation programs (including financial and technical
assistance);
(3) agricultural credit programs;
(4) rural development programs; and
(5) forestry programs.
(b) CRITERIA FOR REVIEW.—In carrying out the review under
subsection (a), the Secretary shall consider—
(1) the extent to which agricultural commodity programs
and conservation programs are consistent with tribal goals
and priorities regarding the sustainable use of agricultural
land;
(2) strategies for increasing tribal participation in agricultural commodity programs and conservation programs;
(3) the educational and training opportunities available
to Indian tribes and members of Indian tribes in the practical,
technical, and professional aspects of agriculture and land
management; and
(4) the development and management of agricultural land
under the jurisdiction of Indian tribes in accordance with
integrated resource management plans that—
(A) ensure proper management of the land;
(B) produce increased economic returns;
(C) promote employment opportunities; and
(D) improve the social and economic well-being of
Indian tribes and members of Indian tribes.
(c) CONSULTATION.—In carrying out this section, the Secretary
shall consult with—
(1) the Secretary of the Interior;
(2) local officers and employees of the Department of Agriculture; and
(3) program recipients.
(d) REPORT.—Not later than 1 year after the date of enactment
of this Act, the Secretary shall submit to Congress a report that
contains—

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116 STAT. 540

PUBLIC LAW 107–171—MAY 13, 2002
(1) a description of the results of the review conducted
under this section;
(2) recommendations for program improvements; and
(3) a description of actions that will be taken to carry
out the improvements.
Approved May 13, 2002.

LEGISLATIVE HISTORY—H.R. 2646 (S. 1731):
HOUSE REPORTS: Nos. 107–191, Pts. 1 and 2 (both from Comm. on Agriculture)
and Pt. 3 (Comm. on International Relations) and 107–424
(Comm. of Conference).
SENATE REPORTS: No. 107–117 accompanying S. 1731 (Comm. on Agriculture,
Nutrition, and Forestry).
CONGRESSIONAL RECORD:
Vol. 147 (2001): Oct. 3–5, considered and passed House.
Vol. 148 (2002): Feb. 13, considered and passed Senate, amended, in lieu of
S. 1731.
May 2, House agreed to conference report.
May 7, 8, Senate considered and agreed to conference report.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 38 (2002):
May 13, Presidential remarks.

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