Text: S.3240 — 112th Congress (2011-2012)All Bill Information (Except Text)

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July 10, 2012

Ordered to be printed as passed




112th CONGRESS
2d Session
S. 3240

AN ACT

To reauthorize agricultural programs through 2017, 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) In general.—This Act may be cited as the “Agriculture Reform, Food, and Jobs Act of 2012”.

(b) Table of contents.—The table of contents for this Act is as follows:


Sec. 1. Short title; table of contents.

Sec. 2. Definition of Secretary.

Sec. 1101. Repeal of direct payments.

Sec. 1102. Repeal of counter-cyclical payments.

Sec. 1103. Repeal of average crop revenue election program.

Sec. 1104. Definitions.

Sec. 1105. Agriculture risk coverage.

Sec. 1106. Producer agreement required as condition of provision of payments.

Sec. 1107. Period of effectiveness.

Sec. 1108. Adjusted gross income limitation for conservation programs.

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.

Sec. 1210. Adjustments of loans.

Sec. 1301. Sugar program.

Sec. 1401. Definitions.

Sec. 1402. Calculation of average feed cost and actual dairy production margins.

Sec. 1411. Establishment of dairy production margin protection program.

Sec. 1412. Participation of dairy operations in production margin protection program.

Sec. 1413. Production history of participating dairy operations.

Sec. 1414. Basic production margin protection.

Sec. 1415. Supplemental production margin protection.

Sec. 1416. Effect of failure to pay administration fees or premiums.

Sec. 1431. Establishment of dairy market stabilization program.

Sec. 1432. Threshold for implementation and reduction in dairy payments.

Sec. 1433. Milk marketings information.

Sec. 1434. Calculation and collection of reduced dairy operation payments.

Sec. 1435. Remitting funds to the Secretary and use of funds.

Sec. 1436. Suspension of reduced payment requirement.

Sec. 1437. Enforcement.

Sec. 1438. Audit requirements.

Sec. 1439. Study; report.

Sec. 1451. Duration.

Sec. 1452. Administration and enforcement.

Sec. 1461. Dairy product mandatory reporting.

Sec. 1462. Federal milk marketing order information.

Sec. 1471. Repeal of dairy product price support and milk income loss contract programs.

Sec. 1472. Repeal of dairy export incentive program.

Sec. 1473. Extension of dairy forward pricing program.

Sec. 1474. Extension of dairy indemnity program.

Sec. 1475. Extension of dairy promotion and research program.

Sec. 1476. Extension of Federal Milk Marketing Order Review Commission.

Sec. 1481. Federal milk marketing orders.

Sec. 1491. Effective date.

Sec. 1501. Supplemental agricultural disaster assistance programs.

Sec. 1601. Administration generally.

Sec. 1602. Suspension of permanent price support authority.

Sec. 1603. Payment limitations.

Sec. 1604. Payments limited to active farmers.

Sec. 1605. Adjusted gross income limitation.

Sec. 1606. Geographically disadvantaged farmers and ranchers.

Sec. 1607. Personal liability of producers for deficiencies.

Sec. 1608. Prevention of deceased individuals receiving payments under farm commodity programs.

Sec. 1609. Appeals.

Sec. 1610. Technical corrections.

Sec. 1611. Assignment of payments.

Sec. 1612. Tracking of benefits.

Sec. 1613. Signature authority.

Sec. 1614. Implementation.

Sec. 2001. Extension and enrollment requirements of conservation reserve program.

Sec. 2002. Farmable wetland program.

Sec. 2003. Duties of owners and operators.

Sec. 2004. Duties of the Secretary.

Sec. 2005. Payments.

Sec. 2006. Contract requirements.

Sec. 2007. Conversion of land subject to contract to other conserving uses.

Sec. 2008. Effective date.

Sec. 2101. Conservation stewardship program.

Sec. 2201. Purposes.

Sec. 2202. Definitions.

Sec. 2203. Establishment and administration.

Sec. 2204. Evaluation of applications.

Sec. 2205. Duties of producers.

Sec. 2206. Limitation on payments.

Sec. 2207. Conservation innovation grants and payments.

Sec. 2208. Effective date.

Sec. 2301. Agricultural Conservation Easement Program.

Sec. 2401. Regional Conservation Partnership Program.

Sec. 2501. Conservation of private grazing land.

Sec. 2502. Grassroots source water protection program.

Sec. 2503. Voluntary public access and habitat incentive program.

Sec. 2504. Agriculture conservation experienced services program.

Sec. 2505. Small watershed rehabilitation program.

Sec. 2506. Terminal lakes assistance.

Sec. 2601. Funding.

Sec. 2602. Technical assistance.

Sec. 2603. Regional equity.

Sec. 2604. Reservation of funds to provide assistance to certain farmers or ranchers for conservation access.

Sec. 2605. Annual report on program enrollments and assistance.

Sec. 2606. Administrative requirements for conservation programs.

Sec. 2607. Rulemaking authority.

Sec. 2608. Standards for State technical committees.

Sec. 2609. Highly erodible land and wetland conservation for crop insurance.

Sec. 2701. Comprehensive conservation enhancement program.

Sec. 2702. Emergency forestry conservation reserve program.

Sec. 2703. Wetlands reserve program.

Sec. 2704. Farmland protection program and farm viability program.

Sec. 2705. Grassland reserve program.

Sec. 2706. Agricultural water enhancement program.

Sec. 2707. Wildlife habitat incentive program.

Sec. 2708. Great Lakes basin program.

Sec. 2709. Chesapeake Bay watershed program.

Sec. 2710. Cooperative conservation partnership initiative.

Sec. 2711. Environmental easement program.

Sec. 2712. Technical amendments.

Sec. 3001. Set-aside for support for organizations through which nonemergency assistance is provided.

Sec. 3002. Food aid quality.

Sec. 3003. Minimum levels of assistance.

Sec. 3004. Reauthorization of Food Aid Consultative Group.

Sec. 3005. Oversight, monitoring, and evaluation of Food for Peace Act programs.

Sec. 3006. Assistance for stockpiling and rapid transportation, delivery, and distribution of shelf-stable prepackaged foods.

Sec. 3007. Limitation on total volume of commodities monetized.

Sec. 3008. Flexibility.

Sec. 3009. Procurement, transportation, testing, and storage of agricultural commodities for prepositioning in the United States and foreign countries.

Sec. 3010. Deadline for agreements to finance sales or to provide other assistance.

Sec. 3011. Minimum level of nonemergency food assistance.

Sec. 3012. Coordination of foreign assistance programs report.

Sec. 3013. Micronutrient fortification programs.

Sec. 3014. John Ogonowski and Doug Bereuter Farmer-to-Farmer Program.

Sec. 3015. Prohibition on assistance for North Korea.

Sec. 3101. Export credit guarantee programs.

Sec. 3102. Funding for market access program.

Sec. 3103. Foreign market development cooperator program.

Sec. 3201. Food for Progress Act of 1985.

Sec. 3202. Bill Emerson Humanitarian Trust.

Sec. 3203. Promotion of agricultural exports to emerging markets.

Sec. 3204. McGovern-Dole International Food for Education and Child Nutrition Program.

Sec. 3205. Technical assistance for specialty crops.

Sec. 3206. Global Crop Diversity Trust.

Sec. 3207. Local and regional food aid procurement projects.

Sec. 3208. Donald Payne Horn of Africa food resilience program.

Sec. 3209. Agricultural trade enhancement study.

Sec. 4001. Food distribution program on Indian reservations.

Sec. 4002. Standard utility allowances based on the receipt of energy assistance payments.

Sec. 4003. Eligibility disqualifications.

Sec. 4004. Ending supplemental nutrition assistance program benefits for lottery or gambling winners.

Sec. 4005. Retail food stores.

Sec. 4006. Improving security of food assistance.

Sec. 4007. Technology modernization for retail food stores.

Sec. 4008. Use of benefits for purchase of community-supported agriculture share.

Sec. 4009. Restaurant meals program.

Sec. 4010. Quality control error rate determination.

Sec. 4011. Performance bonus payments.

Sec. 4012. Authorization of appropriations.

Sec. 4013. Assistance for community food projects.

Sec. 4014. Emergency food assistance.

Sec. 4015. Nutrition education.

Sec. 4016. Retail food store and recipient trafficking.

Sec. 4017. Technical and conforming amendments.

Sec. 4101. Commodity distribution program.

Sec. 4102. Commodity supplemental food program.

Sec. 4103. Distribution of surplus commodities to special nutrition projects.

Sec. 4104. Technical and conforming amendments.

Sec. 4201. Purchase of fresh fruits and vegetables for distribution to schools and service institutions.

Sec. 4202. Seniors farmers' market nutrition program.

Sec. 4203. Nutrition information and awareness pilot program.

Sec. 4204. Whole grain products.

Sec. 4205. Hunger-free communities.

Sec. 4206. Healthy Food Financing Initiative.

Sec. 4207. Pulse crop products.

Sec. 4208. Dietary Guidelines for Americans.

Sec. 4209. Purchases of locally produced foods.

Sec. 5001. Farmer loans, servicing, and other assistance under the Consolidated Farm and Rural Development Act.

Sec. 5101. State agricultural mediation programs.

Sec. 5102. Loans to purchasers of highly fractionated land.

Sec. 5103. Removal of duplicative appraisals.

Sec. 6001. Reorganization of the Consolidated Farm and Rural Development Act.

Sec. 6002. Conforming amendments.

Sec. 6101. Definition of rural area.

Sec. 6102. Guarantees for bonds and notes issued for electrification or telephone purposes.

Sec. 6103. Expansion of 911 access.

Sec. 6104. Access to broadband telecommunications services in rural areas.

Sec. 6201. Distance learning and telemedicine.

Sec. 6202. Rural energy savings program.

Sec. 6203. Funding of pending rural development loan and grant applications.

Sec. 6204. Study of rural transportation issues.

Sec. 6205. Agricultural transportation policy.

Sec. 7101. National Agricultural Research, Extension, Education, and Economics Advisory Board.

Sec. 7102. Specialty crop committee.

Sec. 7103. Veterinary services grant program.

Sec. 7104. Grants and fellowships for food and agriculture sciences education.

Sec. 7105. Agricultural and food policy research centers.

Sec. 7106. Education grants to Alaska Native serving institutions and Native Hawaiian serving institutions.

Sec. 7107. Nutrition education program.

Sec. 7108. Continuing animal health and disease research programs.

Sec. 7109. Grants to upgrade agricultural and food sciences facilities at 1890 land-grant colleges, including Tuskegee University.

Sec. 7110. Grants to upgrade agricultural and food sciences facilities and equipment at insular area land-grant institutions.

Sec. 7111. Hispanic-serving institutions.

Sec. 7112. Competitive grants for international agricultural science and education programs.

Sec. 7113. University research.

Sec. 7114. Extension service.

Sec. 7115. Supplemental and alternative crops.

Sec. 7116. Capacity building grants for NLGCA institutions.

Sec. 7117. Aquaculture assistance programs.

Sec. 7118. Rangeland research programs.

Sec. 7119. Special authorization for biosecurity planning and response.

Sec. 7120. Distance education and resident instruction grants program for insular area institutions of higher education.

Sec. 7201. Best utilization of biological applications.

Sec. 7202. Integrated management systems.

Sec. 7203. Sustainable agriculture technology development and transfer program.

Sec. 7204. National training program.

Sec. 7205. National Genetics Resources Program.

Sec. 7206. National Agricultural Weather Information System.

Sec. 7207. High-priority research and extension initiatives.

Sec. 7208. Organic agriculture research and extension initiative.

Sec. 7209. Farm business management.

Sec. 7210. Regional centers of excellence.

Sec. 7211. Assistive technology program for farmers with disabilities.

Sec. 7212. National rural information center clearinghouse.

Sec. 7301. Relevance and merit of agricultural research, extension, and education funded by the Department.

Sec. 7302. Integrated research, education, and extension competitive grants program.

Sec. 7303. Support for research regarding diseases of wheat, triticale, and barley caused by Fusarium graminearum or by Tilletia indica.

Sec. 7304. Grants for youth organizations.

Sec. 7305. Specialty crop research initiative.

Sec. 7306. Food animal residue avoidance database program.

Sec. 7307. Office of pest management policy.

Sec. 7308. Authorization of regional integrated pest management centers.

Sec. 7401. Critical Agricultural Materials Act.

Sec. 7402. Equity in Educational Land-Grant Status Act of 1994.

Sec. 7403. Research Facilities Act.

Sec. 7404. Competitive, Special, and Facilities Research Grant Act.

Sec. 7405. Enhanced use lease authority pilot program under Department of Agriculture Reorganization Act of 1994.

Sec. 7406. Renewable Resources Extension Act of 1978.

Sec. 7407. National Aquaculture Act of 1980.

Sec. 7408. Beginning farmer and rancher development program under Farm Security and Rural Investment Act of 2002.

Sec. 7501. Agricultural biosecurity communication center.

Sec. 7502. Assistance to build local capacity in agricultural biosecurity planning, preparation, and response.

Sec. 7503. Research and development of agricultural countermeasures.

Sec. 7504. Agricultural biosecurity grant program.

Sec. 7511. Grazinglands research laboratory.

Sec. 7512. Budget submission and funding.

Sec. 7513. Natural products research program.

Sec. 7514. Sun grant program.

Sec. 7601. Foundation for Food and Agriculture Research.

Sec. 7602. Objective and scholarly agricultural and food law research and information.

Sec. 8001. Forest land enhancement program.

Sec. 8002. Watershed forestry assistance program.

Sec. 8003. Expired cooperative national forest products marketing program.

Sec. 8004. Hispanic-serving institution agricultural land national resources leadership program.

Sec. 8005. Tribal watershed forestry assistance program.

Sec. 8101. State-wide assessment and strategies for forest resources.

Sec. 8102. Forest stewardship program.

Sec. 8103. Forest Legacy Program.

Sec. 8104. Community forest and open space conservation program.

Sec. 8105. Urban and community forestry assistance.

Sec. 8201. Rural revitalization technologies.

Sec. 8202. Office of International Forestry.

Sec. 8203. Insect infestations and related diseases.

Sec. 8204. Stewardship end result contracting projects.

Sec. 8205. Healthy forests reserve program.

Sec. 8301. McIntire-Stennis Cooperative Forestry Act.

Sec. 8302. Revision of strategic plan for forest inventory and analysis.

Sec. 9001. Definition of renewable chemical.

Sec. 9002. Biobased markets program.

Sec. 9003. Biorefinery, renewable chemical, and biobased product manufacturing assistance.

Sec. 9004. Repeal of repowering assistance program and transfer of remaining funds.

Sec. 9005. Bioenergy program for advanced biofuels.

Sec. 9006. Biodiesel fuel education program.

Sec. 9007. Rural Energy for America Program.

Sec. 9008. Biomass research and development.

Sec. 9009. Feedstock flexibility program for bioenergy producers.

Sec. 9010. Biomass Crop Assistance Program.

Sec. 9011. Repeal of forest biomass for energy.

Sec. 9012. Community wood energy program.

Sec. 9013. Repeal of renewable fertilizer study.

Sec. 10001. Specialty crops market news allocation.

Sec. 10002. Repeal of grant program to improve movement of specialty crops.

Sec. 10003. Farmers market and local food promotion program.

Sec. 10004. Study on local food production and program evaluation.

Sec. 10005. Organic agriculture.

Sec. 10006. Food safety education initiatives.

Sec. 10007. Coordinated plant management program.

Sec. 10008. Specialty crop block grants.

Sec. 10009. Recordkeeping, investigations, and enforcement.

Sec. 10010. Report on honey.

Sec. 10011. Effective date.

Sec. 11001. Supplemental coverage option.

Sec. 11002. Premium amounts for catastrophic risk protection.

Sec. 11003. Permanent enterprise unit.

Sec. 11004. Enterprise units for irrigated and nonirrigated crops.

Sec. 11005. Data collection.

Sec. 11006. Adjustment in actual production history to establish insurable yields.

Sec. 11007. Submission and review of policies.

Sec. 11008. Board review and approval.

Sec. 11009. Consultation.

Sec. 11010. Budget limitations on renegotiation of the standard reinsurance agreement.

Sec. 11011. Stacked income protection plan for producers of upland cotton.

Sec. 11012. Peanut revenue crop insurance.

Sec. 11013. Authority to correct errors.

Sec. 11014. Implementation.

Sec. 11015. Approval of costs for research and development.

Sec. 11016. Whole farm risk management insurance.

Sec. 11017. Study of food safety insurance.

Sec. 11018. Crop insurance for livestock.

Sec. 11019. Margin coverage for catfish.

Sec. 11020. Poultry business disruption insurance policy.

Sec. 11021. Crop insurance for organic crops.

Sec. 11022. Research and development.

Sec. 11023. Pilot programs.

Sec. 11024. Index-based weather insurance pilot program.

Sec. 11025. Enhancing producer self-help through farm financial benchmarking.

Sec. 11026. Beginning farmer and rancher provisions.

Sec. 11027. Agricultural management assistance, risk management education, and organic certification cost share assistance.

Sec. 11028. Crop production on native sod.

Sec. 11029. Technical amendments.

Sec. 11030. Greater accessibility for crop insurance.

Sec. 11031. GAO crop insurance fraud report.

Sec. 11032. Limitation on premium subsidy based on average adjusted gross income.

Sec. 12001. Outreach and assistance for socially disadvantaged farmers and ranchers and veteran farmers and ranchers.

Sec. 12002. Office of Advocacy and Outreach.

Sec. 12101. Wildlife reservoir zoonotic disease initiative.

Sec. 12102. Trichinae certification program.

Sec. 12103. National Aquatic Animal Health Plan.

Sec. 12104. Sheep production and marketing grant program.

Sec. 12105. Feral swine eradication pilot program.

Sec. 12201. Military veterans agricultural liaison.

Sec. 12202. Information gathering.

Sec. 12203. Grants to improve supply, stability, safety, and training of agricultural labor force.

Sec. 12204. Noninsured crop assistance program.

Sec. 12205. Regional economic and infrastructure development.

Sec. 12206. Canada geese removal.

Sec. 12207. Office of Tribal Relations.

Sec. 12208. Repeal of duplicative program.

Sec. 12209. Sense of the Senate.

Sec. 12210. Acer Access and Development Program.

Sec. 12211. Definition of rural area for purposes of the Housing Act of 1949.

Sec. 12212. Animal welfare.

Sec. 12213. Prohibition on attending an animal fight or causing a minor to attend an animal fight; enforcement of animal fighting provisions.

Sec. 12214. Prohibiting use of presidential election campaign funds for party conventions.

Sec. 12215. Reports on effects of defense and nondefense budget sequestration.

SEC. 2. Definition of Secretary.

In this Act, the term “Secretary” means the Secretary of Agriculture.

SEC. 1101. Repeal of direct payments.

(a) Repeal.—Sections 1103 and 1303 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8713, 8753) are repealed.

(b) Continued application for 2012 crop year.—Sections 1103 and 1303 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8713, 8753), as in effect on the day before the date of enactment of this Act, shall continue to apply through the 2012 crop year with respect to all covered commodities (as defined in section 1001 of that Act (7 U.S.C. 8702)) (except pulse crops) and peanuts on a farm.

SEC. 1102. Repeal of counter-cyclical payments.

(a) Repeal.—Sections 1104 and 1304 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8714, 8754) are repealed.

(b) Continued application for 2012 crop year.—Sections 1104 and 1304 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8714, 8754), as in effect on the day before the date of enactment of this Act, shall continue to apply through the 2012 crop year with respect to all covered commodities (as defined in section 1001 of that Act (7 U.S.C. 8702)) and peanuts on a farm.

SEC. 1103. Repeal of average crop revenue election program.

(a) Repeal.—Section 1105 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8715) is repealed.

(b) Continued application for 2012 crop year.—Section 1105 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8715), as in effect on the day before the date of enactment of this Act, shall continue to apply through the 2012 crop year with respect to all covered commodities (as defined in section 1001 of that Act (7 U.S.C. 8702)) and peanuts on a farm for which the irrevocable election under section 1105 of that Act is made before the date of enactment of this Act.

SEC. 1104. Definitions.

In this subtitle, subtitle B, and subtitle F:

(1) ACTUAL CROP REVENUE.—The term “actual crop revenue”, with respect to a covered commodity for a crop year, means the amount determined by the Secretary under section 1105(c)(3).

(2) AGRICULTURE RISK COVERAGE GUARANTEE.—The term “agriculture risk coverage guarantee”, with respect to a covered commodity for a crop year, means the amount determined by the Secretary under section 1105(c)(4).

(3) AGRICULTURE RISK COVERAGE PAYMENT.—The term “agriculture risk coverage payment” means a payment under section 1105(c).

(4) AVERAGE INDIVIDUAL YIELD.—The term “average individual yield” means the yield reported by a producer for purposes of subtitle A of the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.), to the maximum extent practicable.

(5) COUNTY COVERAGE.—For the purposes of agriculture risk coverage under section 1105, the term “county coverage” means coverage determined using the total quantity of all acreage in a county of the covered commodity that is planted or prevented from being planted for harvest by a producer with the yield determined by the average county yield described in subsection (c) of that section.

(6) COVERED COMMODITY.—

(A) IN GENERAL.—The term “covered commodity” means wheat, corn, grain sorghum, barley, oats, long grain rice, medium grain rice, pulse crops, soybeans, other oilseeds, and peanuts.

(B) POPCORN.—The Secretary—

(i) shall study the feasibility of including popcorn as a covered commodity by 2014; and

(ii) if the Secretary determines it to be feasible, shall designate popcorn as a covered commodity.

(7) ELIGIBLE ACRES.—

(A) IN GENERAL.—Except as provided in subparagraphs (B) through (D), the term “eligible acres” means all acres planted or prevented from being planted to all covered commodities on a farm in any crop year.

(B) MAXIMUM.—Except as provided in (C), the total quantity of eligible acres on a farm determined under subparagraph (A) shall not exceed the average total acres planted or prevented from being planted to covered commodities and upland cotton on the farm for the 2009 through 2012 crop years, as determined by the Secretary.

(C) ADJUSTMENT.—The Secretary shall provide for an adjustment, as appropriate, in the eligible acres for covered commodities for a farm if any of the following circumstances occurs:

(i) If a conservation reserve contract for a farm in a county entered into under section 1231 of the Food Security Act of 1985 (16 U.S.C. 3831) expires or is voluntarily terminated or cropland is released from coverage under a conservation reserve contract, the Secretary shall provide for an adjustment, as appropriate, in the eligible acres for the farm to a total quantity that is the higher of—

(I) the total base acreage for the farm, less any upland cotton base acreage, that was suspended during the conservation reserve contract; or

(II) the product obtained by multiplying—

(aa) the average proportion that—

(AA) the total number of acres planted to covered commodities and upland cotton in the county for crop years 2009 through 2012; bears to

(BB) the total number of all acres of covered commodities, grassland, and upland cotton acres in the county for the same crop years; by

(bb) the total acres for which coverage has expired, voluntarily terminated, or been released under the conservation reserve contract.

(ii) The producer has eligible oilseed acreage as the result of the Secretary designating additional oilseeds, which shall be determined in the same manner as eligible oilseed acreage under section 1101(a)(1)(D) of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8711(a)(1)(D)).

(iii) The producer has any acreage not cropped during the 2009 through 2012 crop years, but placed into an established rotation practice for the purposes of enriching land or conserving moisture for subsequent crop years, including summer fallow, as determined by the Secretary.

(D) EXCLUSION.—The term “eligible acres” does not include any crop subsequently planted during the same crop year on the same land for which the first crop is eligible for payments under this subtitle, unless the crop was planted in an area approved for double cropping, as determined by the Secretary.

(8) EXTRA LONG STAPLE COTTON.—The term “extra long staple cotton” means cotton that—

(A) is produced from pure strain varieties of the Barbadense species or any hybrid of the species, 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.

(9) INDIVIDUAL COVERAGE.—For purposes of agriculture risk coverage under section 1105, the term “individual coverage” means coverage determined using the total quantity of all acreage in a county of the covered commodity that is planted or prevented from being planted for harvest by a producer with the yield determined by the average individual yield of the producer described in subsection (c) of that section.

(10) MEDIUM GRAIN RICE.—The term “medium grain rice” includes short grain rice.

(11) MIDSEASON PRICE.—The term “midseason price” means the applicable national average market price received by producers for the first 5 months of the applicable marketing year, as determined by the Secretary.

(12) OTHER OILSEED.—The term “other oilseed” means a crop of sunflower seed, rapeseed, canola, safflower, flaxseed, mustard seed, crambe, sesame seed, or any oilseed designated by the Secretary.

(13) PRODUCER.—

(A) IN GENERAL.—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.

(B) HYBRID SEED.—In determining whether a grower of hybrid seed is a producer, the Secretary shall—

(i) not take into consideration the existence of a hybrid seed contract; and

(ii) ensure that program requirements do not adversely affect the ability of the grower to receive a payment under this title.

(14) PULSE CROP.—The term “pulse crop” means dry peas, lentils, small chickpeas, and large chickpeas.

(15) STATE.—The term “State” means—

(A) a State;

(B) the District of Columbia;

(C) the Commonwealth of Puerto Rico; and

(D) any other territory or possession of the United States.

(16) TRANSITIONAL YIELD.—The term “transitional yield” has the meaning given the term in section 502(b) of the Federal Crop Insurance Act (7 U.S.C. 1502(b)).

(17) UNITED STATES.—The term “United States”, when used in a geographical sense, means all of the States.

(18) UNITED STATES PREMIUM FACTOR.—The term “United States Premium Factor” means the percentage by which the difference in the United States loan schedule premiums for Strict Middling (SM) 118 -inch upland cotton and for Middling (M) 1332 -inch upland cotton exceeds the difference in the applicable premiums for comparable international qualities.

SEC. 1105. Agriculture risk coverage.

(a) Payments required.—If the Secretary determines that payments are required under subsection (c), the Secretary shall make payments for each covered commodity available to producers in accordance with this section.

(b) Coverage election.—

(1) IN GENERAL.—For the period of crop years 2013 through 2017, the producers shall make a 1-time, irrevocable election to receive—

(A) individual coverage under this section, as determined by the Secretary; or

(B) in the case of a county with sufficient data (as determined by the Secretary), county coverage under this section.

(2) EFFECT OF ELECTION.—The election made under paragraph (1) shall be binding on the producers making the election, regardless of covered commodities planted, and applicable to all acres under the operational control of the producers, in a manner that—

(A) acres brought under the operational control of the producers after the election are included; and

(B) acres no longer under the operational control of the producers after the election are no longer subject to the election of the producers but become subject to the election of the subsequent producers.

(3) DUTIES OF THE SECRETARY.—The Secretary shall ensure that producers are precluded from taking any action, including reconstitution, transfer, or other similar action, that would have the effect of altering or reversing the election made under paragraph (1).

(c) Agriculture risk coverage.—

(1) PAYMENTS.—The Secretary shall make agriculture risk coverage payments available under this subsection for each of the 2013 through 2017 crop years if the Secretary determines that—

(A) the actual crop revenue for the crop year for the covered commodity; is less than

(B) the agriculture risk coverage guarantee for the crop year for the covered commodity.

(2) TIME FOR PAYMENTS.—If the Secretary determines under this subsection that agriculture risk coverage payments are required to be made for the covered commodity, the agriculture risk coverage payments shall be made as soon as practicable thereafter.

(3) ACTUAL CROP REVENUE.—The amount of the actual crop revenue for a crop year of a covered commodity shall be equal to the product obtained by multiplying—

(A)(i) in the case of individual coverage, the actual average individual yield for the covered commodity, as determined by the Secretary; or

(ii) in the case of county coverage, the actual average yield for the county for the covered commodity, as determined by the Secretary; and

(B) the higher of—

(i) the midseason price; or

(ii) if applicable, the national marketing assistance loan rate for the covered commodity under subtitle B.

(4) AGRICULTURE RISK COVERAGE GUARANTEE.—

(A) IN GENERAL.—The agriculture risk coverage guarantee for a crop year for a covered commodity shall equal 89 percent of the benchmark revenue.

(B) BENCHMARK REVENUE.—

(i) IN GENERAL.—The benchmark revenue shall be the product obtained by multiplying—

(I)(aa) in the case of individual coverage, subject to clause (ii), the average individual yield, as determined by the Secretary, for the most recent 5 crop years, excluding each of the crop years with the highest and lowest yields; or

(bb) in the case of county coverage, the average county yield, as determined by the Secretary, for the most recent 5 crop years, excluding each of the crop years with the highest and lowest yields; and

(II) subject to clause (iii), the average national marketing year average price for the most recent 5 crop years, excluding each of the crop years with the highest and lowest prices.

(ii) USE OF TRANSITIONAL YIELDS.—If the yield determined under clause (i)(I)(aa)—

(I) for the 2012 crop year or any prior crop year, is less than 60 percent of the applicable transitional yield, the Secretary shall use 60 percent of the applicable transitional yield for that crop year; and

(II) for the 2013 crop year and any subsequent crop year, is less than 70 percent of the applicable transitional yield, the Secretary shall use 70 percent of the applicable transitional yield for that crop year.

(iii) SPECIAL RULE FOR RICE AND PEANUTS.—If the national marketing year average price under clause (i)(II) for any of the applicable crop years is lower than the price for the covered commodity listed below, the Secretary shall use the following price for that crop year:

(I) For long grain rice, $13.00 per hundredweight.

(II) For medium grain rice, $13.00 per hundredweight.

(III) For peanuts, $530.00 per ton.

(5) PAYMENT RATE.—The payment rate for each covered commodity shall be equal to the lesser of—

(A) the amount that—

(i) the agriculture risk coverage guarantee for the covered commodity; exceeds

(ii) the actual crop revenue for the crop year of the covered commodity; or

(B) 10 percent of the benchmark revenue for the crop year of the covered commodity.

(6) PAYMENT AMOUNT.—If agriculture risk coverage payments under this subsection are required to be paid for any of the 2013 through 2017 crop years of a covered commodity, the amount of the agriculture risk coverage payment for the crop year shall be equal to the product obtained by multiplying—

(A) the payment rate under paragraph (5); and

(B)(i) in the case of individual coverage the sum of—

(I) 65 percent of the planted eligible acres of the covered commodity; and

(II) 45 percent of the eligible acres that were prevented from being planted to the covered commodity; or

(ii) in the case of county coverage—

(I) 80 percent of the planted eligible acres of the covered commodity; and

(II) 45 percent of the eligible acres that were prevented from being planted to the covered commodity.

(7) DUTIES OF THE SECRETARY.—In carrying out the program under this subsection, the Secretary shall—

(A) to the maximum extent practicable, use all available information and analysis to check for anomalies in the determination of payments under the program;

(B) to the maximum extent practicable, calculate a separate actual crop revenue and agriculture risk coverage guarantee for irrigated and nonirrigated covered commodities;

(C) differentiate by type or class the national average price of—

(i) sunflower seeds;

(ii) barley, using malting barley values; and

(iii) wheat; and

(D) assign a yield for each acre planted or prevented from being planted for the crop year for the covered commodity on the basis of the yield history of representative farms in the State, region, or crop reporting district, as determined by the Secretary, if the Secretary cannot establish the yield as determined under paragraph (3)(A)(ii) or (4)(B)(i) or if the yield determined under paragraph (3)(A)(ii) or (4) is an unrepresentative average yield for the covered commodity as determined by the Secretary.

SEC. 1106. Producer agreement required as condition of provision of payments.

(a) Compliance with certain requirements.—

(1) REQUIREMENTS.—Before the producers on a farm may receive agriculture risk coverage payments, 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.);

(C) to use the land on the farm for an agricultural or conserving use in a quantity equal to the attributable eligible acres of the farm, and not for a nonagricultural commercial, industrial, or residential use, as determined by the Secretary; and

(D) 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 (C).

(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.—

(A) IN GENERAL.—Except as provided in paragraph (2), a transfer of (or change in) the interest of the producers on a farm for which agriculture risk coverage payments are made shall result in the termination of the agriculture risk coverage payments, unless the transferee or owner of the acreage agrees to assume all obligations under subsection (a).

(B) EFFECTIVE DATE.—The termination shall take effect on the date determined by the Secretary.

(2) EXCEPTION.—If a producer entitled to an agriculture risk coverage 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) Reports.—

(1) 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.

(2) PRODUCTION REPORTS.—As a condition on the receipt of any benefits under section 1105, the Secretary shall require producers on a farm to submit to the Secretary annual production reports with respect to all covered commodities produced on the farm.

(3) PENALTIES.—No penalty with respect to benefits under this subtitle or subtitle B shall be assessed against the producers on a farm for an inaccurate acreage or production report unless the producers on the farm knowingly and willfully falsified the acreage or production report.

(4) DATA REPORTING.—To the maximum extent practicable, the Secretary shall use data reported by the producer pursuant to requirements under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) to meet the obligations described in paragraphs (1) and (2), without additional submissions to the Department.

(d) Tenants and sharecroppers.—In carrying out this subtitle, the Secretary shall provide adequate safeguards to protect the interests of tenants and sharecroppers.

SEC. 1107. Period of effectiveness.

Sections 1104 through 1106 shall be effective beginning with the 2013 crop year of each covered commodity through the 2017 crop year.

SEC. 1108. Adjusted gross income limitation for conservation programs.

Section 1001D(b)(2)(A) of the Food Security Act of 1985 (7 U.S.C. 1308–3a(b)(2)(A)) is amended—

(1) by striking “Limits.—” and all that follows through “clause (ii),” and inserting “Limits.—Notwithstanding any other provision of law,”; and

(2) by striking clause (ii).

SEC. 1201. Availability of nonrecourse marketing assistance loans for loan commodities.

(a) Definition of loan commodity.—In this subtitle, the term “loan commodity” means wheat, corn, grain sorghum, barley, oats, upland cotton, extra long staple cotton, long grain rice, medium grain rice, peanuts, soybeans, other oilseeds, graded wool, nongraded wool, mohair, honey, dry peas, lentils, small chickpeas, and large chickpeas.

(b) Nonrecourse loans available.—

(1) IN GENERAL.—For each of the 2013 through 2017 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.

(c) Eligible production.—The producers on a farm shall be eligible for a marketing assistance loan under subsection (b) for any quantity of a loan commodity produced on the farm.

(d) Compliance with conservation and wetlands requirements.—

(1) REQUIREMENTS.—Before the producers on a farm may receive a marketing assistance loan or any other payment or benefit under this subtitle, the producers shall agree, for 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.);

(C) to use the land on the farm for an agricultural or conserving use in a quantity equal to the attributable eligible acres of the farm, and not for a nonagricultural commercial, industrial, or residential use, as determined by the Secretary; and

(D) 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 (C).

(2) COMPLIANCE.—The Secretary may issue such rules as the Secretary considers necessary to ensure producer compliance with paragraph (1).

(3) MODIFICATION.—At the request of a transferee or owner, the Secretary may modify the requirements of this subsection if the modifications are consistent with the purposes of this subsection, as determined by the Secretary.

(e) Special rules for peanuts.—

(1) IN GENERAL.—This subsection shall apply only to producers of peanuts.

(2) OPTIONS FOR OBTAINING LOAN.—A marketing assistance loan under this section, and loan deficiency payments under section 1205, 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.

(3) STORAGE OF LOAN PEANUTS.—As a condition on the approval by the Secretary 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 the 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.

(4) STORAGE, HANDLING, AND ASSOCIATED COSTS.—

(A) IN GENERAL.—To ensure proper storage of peanuts for which a loan is made under this section, the Secretary shall pay handling and other associated costs (other than storage costs) incurred at the time at which the peanuts are placed under loan, as determined by the Secretary.

(B) REDEMPTION AND FORFEITURE.—The Secretary shall—

(i) require the repayment of handling and other associated costs paid under subparagraph (A) for all peanuts pledged as collateral for a loan that is redeemed under this section; and

(ii) pay storage, handling, and other associated costs for all peanuts pledged as collateral that are forfeited under this section.

(5) 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.

(6) REIMBURSABLE AGREEMENTS AND PAYMENT OF ADMINISTRATIVE EXPENSES.—The Secretary may implement any reimbursable agreements or provide for the payment of administrative expenses under this subsection only in a manner that is consistent with those activities in regard to other loan commodities.

SEC. 1202. Loan rates for nonrecourse marketing assistance loans.

(a) In general.—For purposes of each of the 2013 through 2017 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, $2.94 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, $1.95 per bushel.

(5) In the case of oats, $1.39 per bushel.

(6) In the case of base quality of upland cotton, for the 2013 and each subsequent crop year, the simple average of the adjusted prevailing world price for the 2 immediately preceding marketing years, as determined by the Secretary and announced October 1 preceding the next domestic plantings, but in no case less than $0.47 per pound or more than $0.52 per pound.

(7) In the case of extra long staple cotton, $0.7977 per pound.

(8) In the case of long grain rice, $6.50 per hundredweight.

(9) In the case of medium grain rice, $6.50 per hundredweight.

(10) In the case of soybeans, $5.00 per bushel.

(11) In the case of other oilseeds, $10.09 per hundredweight for each of the following kinds of oilseeds:

(A) Sunflower seed.

(B) Rapeseed.

(C) Canola.

(D) Safflower.

(E) Flaxseed.

(F) Mustard seed.

(G) Crambe.

(H) Sesame seed.

(I) Other oilseeds designated by the Secretary.

(12) In the case of dry peas, $5.40 per hundredweight.

(13) In the case of lentils, $11.28 per hundredweight.

(14) In the case of small chickpeas, $7.43 per hundredweight.

(15) In the case of large chickpeas, $11.28 per hundredweight.

(16) In the case of graded wool, $1.15 per pound.

(17) In the case of nongraded wool, $0.40 per pound.

(18) In the case of mohair, $4.20 per pound.

(19) In the case of honey, $0.69 per pound.

(20) In the case of peanuts, $355 per ton.

(b) Single county loan rate for other oilseeds.—The Secretary shall establish a single loan rate in each county for each kind of other oilseeds described in subsection (a)(11).

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.

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, long grain rice, medium grain rice, extra long staple cotton, peanuts and confectionery and each other kind of sunflower seed (other than oil sunflower seed)) 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));

(2) a rate (as determined by the Secretary) that—

(A) is calculated based on average market prices for the loan commodity during the preceding 30-day period; and

(B) will minimize discrepancies in marketing loan benefits across State boundaries and across county boundaries; or

(3) a rate that the Secretary may develop using alternative methods for calculating a repayment rate for a loan commodity that the Secretary determines will—

(A) minimize potential loan forfeitures;

(B) minimize the accumulation of stocks of the commodity by the Federal Government;

(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, long grain rice, and medium grain rice.—The Secretary shall permit producers to repay a marketing assistance loan under section 1201 for upland cotton, long grain rice, and medium grain 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, as determined and adjusted by the Secretary in accordance with this section.

(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 each of upland cotton, long grain rice, and medium grain rice; and

(2) a mechanism by which the Secretary shall announce periodically those prevailing world market prices.

(e) Adjustment of prevailing world market price for upland cotton, long grain rice, and medium grain rice.—

(1) RICE.—The prevailing world market price for long grain rice and medium grain rice determined under subsection (d) shall be adjusted to United States quality and location.

(2) COTTON.—The prevailing world market price for upland cotton determined under subsection (d)—

(A) shall be adjusted to United States quality and location, with the adjustment to include—

(i) a reduction equal to any United States Premium Factor for upland cotton of a quality higher than Middling (M) 1332 -inch; and

(ii) the average costs to market the commodity, including average transportation costs, as determined by the Secretary; and

(B) may be further adjusted, during the period beginning on the date of enactment of this Act and ending on July 31, 2018, if the Secretary determines the adjustment is necessary—

(i) to minimize potential loan forfeitures;

(ii) to minimize the accumulation of stocks of upland cotton by the Federal Government;

(iii) to ensure that upland cotton produced in the United States can be marketed freely and competitively, both domestically and internationally; and

(iv) to ensure an appropriate transition between current-crop and forward-crop price quotations, except that the Secretary may use forward-crop price quotations prior to July 31 of a marketing year only if—

(I) there are insufficient current-crop price quotations; and

(II) the forward-crop price quotation is the lowest such quotation available.

(3) GUIDELINES FOR ADDITIONAL ADJUSTMENTS.—In making adjustments under this subsection, the Secretary shall establish a mechanism for determining and announcing the adjustments in order to avoid undue disruption in the United States market.

(f) Repayment rates for confectionery and other kinds of sunflower seeds.—The Secretary shall permit the producers on a farm to repay a marketing assistance loan under section 1201 for confectionery and each other kind of sunflower seed (other than oil sunflower seed) 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 repayment rate established for oil sunflower seed.

(g) Payment of cotton storage costs.—Effective for each of the 2013 through 2017 crop years, the Secretary shall make cotton storage payments available in the same manner, and at the same rates as the Secretary provided storage payments for the 2006 crop of cotton, except that the rates shall be reduced by 20 percent.

(h) Repayment rate for peanuts.—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—

(1) 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

(2) a rate that the Secretary determines will—

(A) minimize potential loan forfeitures;

(B) minimize the accumulation of stocks of peanuts by the Federal Government;

(C) minimize the cost incurred by the Federal Government in storing peanuts; and

(D) allow peanuts produced in the United States to be marketed freely and competitively, both domestically and internationally.

(i) Authority to temporarily adjust repayment rates.—

(1) ADJUSTMENT AUTHORITY.—In the event of a severe disruption to marketing, transportation, or related infrastructure, the Secretary may modify the repayment rate otherwise applicable under this section for marketing assistance loans under section 1201 for a loan commodity.

(2) DURATION.—Any adjustment made under paragraph (1) in the repayment rate for marketing assistance loans for a loan commodity shall be in effect on a short-term and temporary basis, as determined by the Secretary.

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.—

(A) MARKETING ASSISTANCE LOANS.—Subject to subparagraph (B), 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.

(B) LOAN DEFICIENCY PAYMENT.—Effective for the 2013 through 2017 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 equal to the product obtained 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.

(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.

SEC. 1206. Payments in lieu of loan deficiency payments for grazed acreage.

(a) Eligible producers.—

(1) IN GENERAL.—Effective for the 2013 through 2017 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, 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 2013 through 2017 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)(I) the yield in effect for the calculation of agriculture risk coverage payments under subtitle A with respect to that loan commodity on the farm; or

(II) in the case of a farm without a payment yield for that loan commodity, an appropriate yield established by the Secretary.

(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)(I) the yield in effect for the calculation of agriculture risk coverage payments under subtitle A with respect to wheat on the farm; or

(II) 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 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8712).

(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.—

(A) IN GENERAL.—The Secretary shall establish an availability period for the payments authorized by this section.

(B) CERTAIN COMMODITIES.—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.

(d) Prohibition on crop insurance indemnity or noninsured crop assistance.—A 2013 through 2017 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 a policy or plan of insurance authorized under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) or noninsured crop assistance under section 196 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333).

SEC. 1207. Special marketing loan provisions for upland cotton.

(a) Special import quota.—

(1) DEFINITION OF SPECIAL IMPORT QUOTA.—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.

(2) ESTABLISHMENT.—

(A) IN GENERAL.—The President shall carry out an import quota program during the period beginning on August 1, 2013, and ending on July 31, 2018, as provided in this subsection.

(B) PROGRAM REQUIREMENTS.—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) 1332 -inch cotton, delivered to a definable and significant international market, as determined by the Secretary, exceeds the prevailing world market price, there shall immediately be in effect a special import quota.

(3) QUANTITY.—The quota shall be equal to the consumption during a 1-week period of cotton by domestic mills at the seasonally adjusted average rate of the most recent 3 months for which official data of the Department of Agriculture or other data are available.

(4) APPLICATION.—The quota shall apply to upland cotton purchased not later than 90 days after the date of the Secretary’s announcement under paragraph (2) and entered into the United States not later than 180 days after that date.

(5) OVERLAP.—A special quota period may be established that overlaps any existing quota period if required by paragraph (2), except that a special quota period may not be established under this subsection if a quota period has been established under subsection (b).

(6) 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.

(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 10 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.

(b) Limited global import quota for upland cotton.—

(1) DEFINITIONS.—In this subsection:

(A) DEMAND.—The term “demand” means—

(i) the average seasonally adjusted annual rate of domestic mill consumption of cotton during the most recent 3 months for which official data of the Department of Agriculture (as determined by the Secretary) are available; and

(ii) the larger of—

(I) average exports of upland cotton during the preceding 6 marketing years; or

(II) cumulative exports of upland cotton plus outstanding export sales for the marketing year in which the quota is established.

(B) 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.

(C) SUPPLY.—The term “supply” means, using the latest official data of the Department of Agriculture—

(i) the carryover 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.

(2) PROGRAM.—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 the 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 official data of the Department of Agriculture are available or as estimated by the Secretary.

(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) 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.

(3) NO OVERLAP.—Notwithstanding paragraph (2), a quota period may not be established that overlaps an existing quota period or a special quota period established under subsection (a).

(c) Economic adjustment assistance to users of upland cotton.—

(1) IN GENERAL.—Subject to paragraph (2), the Secretary shall, on a monthly basis, make economic adjustment assistance available to domestic users of upland cotton in the form of payments for all documented use of that upland cotton during the previous monthly period regardless of the origin of the upland cotton.

(2) VALUE OF ASSISTANCE.—Effective beginning on August 1, 2012, the value of the assistance provided under paragraph (1) shall be 3 cents per pound.

(3) ALLOWABLE PURPOSES.—Economic adjustment assistance under this subsection shall be made available only to domestic users of upland cotton that certify that the assistance shall be used only to acquire, construct, install, modernize, develop, convert, or expand land, plant, buildings, equipment, facilities, or machinery.

(4) REVIEW OR AUDIT.—The Secretary may conduct such review or audit of the records of a domestic user under this subsection as the Secretary determines necessary to carry out this subsection.

(5) IMPROPER USE OF ASSISTANCE.—If the Secretary determines, after a review or audit of the records of the domestic user, that economic adjustment assistance under this subsection was not used for the purposes specified in paragraph (3), the domestic user shall be—

(A) liable for the repayment of the assistance to the Secretary, plus interest, as determined by the Secretary; and

(B) ineligible to receive assistance under this subsection for a period of 1 year following the determination of the Secretary.

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 enactment of this Act through July 31, 2018, 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), as determined by the Secretary, is less than 134 percent of the loan rate for extra long staple cotton.

(c) Eligible recipients.—The Secretary shall make payments available under this section to domestic users of extra long staple cotton produced in the United States and exporters of extra long staple cotton produced in the United States that enter into an agreement with the Commodity Credit Corporation to participate in the program under this section.

(d) Payment amount.—Payments under this section shall be based on the amount of the difference in the prices referred to in subsection (b)(1) during the fourth week of the consecutive 4-week period multiplied by the amount of documented purchases by domestic users and sales for export by exporters made in the week following such a consecutive 4-week period.

SEC. 1209. Availability of recourse loans for high moisture feed grains and seed cotton.

(a) High moisture feed grains.—

(1) DEFINITION OF HIGH MOISTURE STATE.—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.

(2) RECOURSE LOANS AVAILABLE.—For each of the 2013 through 2017 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 the producers on the farm 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.

(3) 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 farm of the producer; by

(B) the lower of the actual average yield used to make 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.

(b) Recourse loans available for seed cotton.—For each of the 2013 through 2017 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)).

SEC. 1210. Adjustments of loans.

(a) Adjustment authority.—Subject to subsection (e), the Secretary may make appropriate adjustments in the loan rates for any loan commodity (other than cotton) for differences in grade, type, quality, location, and other factors.

(b) Manner of adjustment.—The adjustments under subsection (a) shall, to the maximum extent practicable, be made in such a manner that the average loan level for the commodity will, on the basis of the anticipated incidence of the factors, be equal to the level of support determined in accordance with this subtitle and subtitles C through E.

(c) Adjustment on county basis.—

(1) IN GENERAL.—The Secretary may establish loan rates for a crop for producers in individual counties in a manner that results in the lowest loan rate being 95 percent of the national average loan rate, if those loan rates do not result in an increase in outlays.

(2) PROHIBITION.—Adjustments under this subsection shall not result in an increase in the national average loan rate for any year.

(d) Adjustment in loan rate for cotton.—

(1) IN GENERAL.—The Secretary may make appropriate adjustments in the loan rate for cotton for differences in quality factors.

(2) REVISIONS TO QUALITY ADJUSTMENTS FOR UPLAND COTTON.—

(A) IN GENERAL.—Not later than 180 days after the date of enactment of this Act, the Secretary shall implement revisions in the administration of the marketing assistance loan program for upland cotton to more accurately and efficiently reflect market values for upland cotton.

(B) MANDATORY REVISIONS.—Revisions under subparagraph (A) shall include—

(i) the elimination of warehouse location differentials;

(ii) the establishment of differentials for the various quality factors and staple lengths of cotton based on a 3-year, weighted moving average of the weighted designated spot market regions, as determined by regional production;

(iii) the elimination of any artificial split in the premium or discount between upland cotton with a 32 or 33 staple length due to micronaire; and

(iv) a mechanism to ensure that no premium or discount is established that exceeds the premium or discount associated with a leaf grade that is 1 better than the applicable color grade.

(C) DISCRETIONARY REVISIONS.—Revisions under subparagraph (A) may include—

(i) the use of non-spot market price data, in addition to spot market price data, that would enhance the accuracy of the price information used in determining quality adjustments under this subsection;

(ii) adjustments in the premiums or discounts associated with upland cotton with a staple length of 33 or above due to micronaire with the goal of eliminating any unnecessary artificial splits in the calculations of the premiums or discounts; and

(iii) such other adjustments as the Secretary determines appropriate, after consultations conducted in accordance with paragraph (3).

(3) CONSULTATION WITH PRIVATE SECTOR.—

(A) PRIOR TO REVISION.—In making adjustments to the loan rate for cotton (including any review of the adjustments) as provided in this subsection, the Secretary shall consult with representatives of the United States cotton industry.

(B) INAPPLICABILITY OF FEDERAL ADVISORY COMMITTEE ACT.—The Federal Advisory Committee Act (5 U.S.C. App.) shall not apply to consultations under this subsection.

(4) REVIEW OF ADJUSTMENTS.—The Secretary may review the operation of the upland cotton quality adjustments implemented pursuant to this subsection and may make further revisions to the administration of the loan program for upland cotton, by—

(A) revoking or revising any actions taken under paragraph (2)(B); or

(B) revoking or revising any actions taken or authorized to be taken under paragraph (2)(C).

(e) Rice.—The Secretary shall not make adjustments in the loan rates for long grain rice and medium grain rice, except for differences in grade and quality (including milling yields).

SEC. 1301. Sugar program.

(a) Continuation of current program and loan rates.—

(1) SUGARCANE.—Section 156(a)(5) of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272(a)(5)) is amended by striking “the 2012 crop year” and inserting “each of the 2012 through 2017 crop years”.

(2) SUGAR BEETS.—Section 156(b)(2) of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272(b)(2)) is amended by striking “2012” and inserting “2017”.

(3) EFFECTIVE PERIOD.—Section 156(i) of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272(i)) is amended by striking “2012” and inserting “2017”.

(b) Flexible marketing allotments for sugar.—

(1) SUGAR ESTIMATES.—Section 359b(a)(1) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359bb(a)(1)) is amended by striking “2012” and inserting “2017”.

(2) SUGAR IMPORT QUOTA ADJUSTMENT DATE.—Section 359k(b) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359kk(b)) is amended—

(A) by striking “April 1” each place it appears and inserting “February 1”; and

(B) by striking “April 1” each place it appears and inserting “February 1”.

(3) EFFECTIVE PERIOD.—Section 359l(a) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359ll(a)) is amended by striking “2012” and inserting “2017”.

SEC. 1401. Definitions.

In this part:

(1) ACTUAL DAIRY PRODUCTION MARGIN.—The term “actual dairy production margin” means the difference between the all-milk price and the average feed cost, as calculated under section 1402.

(2) ALL-MILK PRICE.—The term “all-milk price” means the average price received, per hundredweight of milk, by dairy operations for all milk sold to plants and dealers in the United States, as determined by the Secretary.

(3) ANNUAL PRODUCTION HISTORY.—The term “annual production history” means the production history determined for a participating dairy operation under section 1413(b) whenever the participating dairy operation purchases supplemental production margin protection.

(4) AVERAGE FEED COST.—The term “average feed cost” means the average cost of feed used by a dairy operation to produce a hundredweight of milk, determined under section 1402 using the sum of the following:

(A) The product determined by multiplying 1.0728 by the price of corn per bushel.

(B) The product determined by multiplying 0.00735 by the price of soybean meal per ton.

(C) The product determined by multiplying 0.0137 by the price of alfalfa hay per ton.

(5) BASIC PRODUCTION HISTORY.—The term “basic production history” means the production history determined for a participating dairy operation under section 1413(a) for provision of basic production margin protection.

(6) CONSECUTIVE 2-MONTH PERIOD.—The term “consecutive 2-month period” refers to the 2-month period consisting of the months of January and February, March and April, May and June, July and August, September and October, or November and December, respectively.

(7) DAIRY OPERATION.—

(A) IN GENERAL.—The term “dairy operation” means, as determined by the Secretary, 1 or more dairy producers that produce and market milk as a single dairy operation in which each dairy producer—

(i) shares in the pooling of resources and a common ownership structure;

(ii) is at risk in the production of milk on the dairy operation; and

(iii) contributes land, labor, management, equipment, or capital to the dairy operation.

(B) ADDITIONAL OWNERSHIP STRUCTURES.—The Secretary shall determine additional ownership structures to be covered by the definition of dairy operation.

(8) HANDLER.—

(A) IN GENERAL.—The term “handler” means the initial individual or entity making payment to a dairy operation for milk produced in the United States and marketed for commercial use.

(B) PRODUCER-HANDLER.—The term includes a “producer-handler” when the producer satisfies the definition in subparagraph (A).

(9) PARTICIPATING DAIRY OPERATION.—The term “participating dairy operation” means a dairy operation that—

(A) signs up under section 1412 to participate in the production margin protection program under subpart A; and

(B) as a result, also participates in the stabilization program under subpart B.

(10) PRODUCTION MARGIN PROTECTION PROGRAM.—The term “production margin protection program” means the dairy production margin protection program required by subpart A.

(11) SECRETARY.—The term “Secretary” means the Secretary of Agriculture.

(12) STABILIZATION PROGRAM.—The term “stabilization program” means the dairy market stabilization program required by subpart B for all participating dairy operations.

(13) STABILIZATION PROGRAM BASE.—The term “stabilization program base”, with respect to a participating dairy operation, means the stabilization program base calculated for the participating dairy operation under section 1431(b).

(14) UNITED STATES.—The term “United States”, in a geographical sense, means the 50 States, the District of Columbia, American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, the Commonwealth of Puerto Rico, the Virgin Islands of the United States, and any other territory or possession of the United States.

SEC. 1402. Calculation of average feed cost and actual dairy production margins.

(a) Calculation of average feed cost.—The Secretary shall calculate the national average feed cost for each month using the following data:

(1) The price of corn for a month shall be the price received during that month by farmers in the United States for corn, as reported in the monthly Agricultural Prices report by the Secretary.

(2) The price of soybean meal for a month shall be the central Illinois price for soybean meal, as reported in the Market News–Monthly Soybean Meal Price Report by the Secretary.

(3) The price of alfalfa hay for a month shall be the price received during that month by farmers in the United States for alfalfa hay, as reported in the monthly Agricultural Prices report by the Secretary.

(b) Calculation of actual dairy production margins.—

(1) PRODUCTION MARGIN PROTECTION PROGRAM.—For use in the production margin protection program under subpart A, the Secretary shall calculate the actual dairy production margin for each consecutive 2-month period by subtracting—

(A) the average feed cost for that consecutive 2-month period, determined in accordance with subsection (a); from

(B) the all-milk price for that consecutive 2-month period.

(2) STABILIZATION PROGRAM.—For use in the stabilization program under subpart B, the Secretary shall calculate each month the actual dairy production margin for the preceding month by subtracting—

(A) the average feed cost for that preceding month, determined in accordance with subsection (a); from

(B) the all-milk price for that preceding month.

(3) TIME FOR CALCULATIONS.—The calculations required by paragraphs (1) and (2) shall be made as soon as practicable using the full month price of the applicable reference month.

SEC. 1411. Establishment of dairy production margin protection program.

Effective not later than 120 days after the effective date of this subtitle, the Secretary shall establish and administer a dairy production margin protection program under which participating dairy operations are paid—

(1) basic production margin protection program payments under section 1414 when actual dairy production margins are less than the threshold levels for such payments; and

(2) supplemental production margin protection program payments under section 1415 if purchased by a participating dairy operation.

SEC. 1412. Participation of dairy operations in production margin protection program.

(a) Eligibility.—All dairy operations in the United States shall be eligible to participate in the production margin protection program, except that a participating dairy operation shall be required to register with the Secretary before the participating dairy operation may receive—

(1) basic production margin protection program payments under section 1414; and

(2) if the participating dairy operation purchases supplemental production margin protection under section 1415, supplemental production margin protection program payments under such section.

(b) Registration process.—

(1) IN GENERAL.—The Secretary shall specify the manner and form by which a participating dairy operation may register to participate in the production margin protection program.

(2) TREATMENT OF MULTIPRODUCER DAIRY OPERATIONS.—If a participating dairy operation is operated by more than 1 dairy producer, all of the dairy producers of the participating dairy operation shall be treated as a single dairy operation for purposes of—

(A) registration to receive basic production margin protection and election to purchase supplemental production margin protection;

(B) payment of the participation fee under subsection (d) and producer premiums under section 1415; and

(C) participation in the stabilization program under subtitle B.

(3) TREATMENT OF PRODUCERS WITH MULTIPLE DAIRY OPERATIONS.—If a dairy producer operates 2 or more dairy operations, each dairy operation of the producer shall separately register to receive basic production margin protection and purchase supplemental production margin protection and only those dairy operations so registered shall be covered by the stabilization program.

(c) Time for registration.—

(1) EXISTING DAIRY OPERATIONS.—During the 15-month period beginning on the date of the initiation of the registration period for the production margin protection program, a dairy operation that is actively engaged as of such date may register with the Secretary—

(A) to receive basic production margin protection; and

(B) if the dairy operation elects, to purchase supplemental production margin protection.

(2) NEW ENTRANTS.—A dairy producer that has no existing interest in a dairy operation as of the date of the initiation of the registration period for the production margin protection program, but that, after such date, establishes a new dairy operation, may register with the Secretary during the 1-year period beginning on the date on which the dairy operation first markets milk commercially—

(A) to receive basic production margin protection; and

(B) if the dairy operation elects, to purchase supplemental production margin protection.

(d) Transition from MILC to production margin protection.—

(1) DEFINITION OF TRANSITION PERIOD.—In this subsection, the term “transition period” means the period during which the milk income loss program established under section 1506 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8773) and the production margin protection program under this subtitle are both in existence.

(2) NOTICE OF AVAILABILITY.—Not later than 30 days after the date of enactment of this Act, the Secretary shall publish a notice in the Federal Register to inform dairy operations of the availability of basic production margin protection and supplemental production margin protection, including the terms of the protection and information about the option of dairy operations during the transition period to make an election described in paragraph (3).

(3) ELECTION.—Except as provided in paragraph (4), a dairy operation may elect to participate in either the milk income loss program established under section 1506 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8773) or the production margin protection program under this subtitle for the duration of the transition period.

(4) TRANSFER TO PRODUCTION MARGIN PROTECTION.—A dairy operation that elects to participate in the milk income loss program established under section 1506 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8773) during the transition period may, at any time, make a permanent transfer to the production margin protection program.

(e) Administration fee.—

(1) ADMINISTRATION FEE REQUIRED.—Except as provided in paragraph (5), a participating dairy operation shall—

(A) pay an administration fee under this subsection to register to participate in the production margin protection program; and

(B) pay the administration fee annually thereafter to continue to participate in the production margin protection program.

(2) FEE AMOUNT.—The administration fee for a participating dairy operation for a calendar year shall be based on the pounds of milk (in millions) marketed by the participating dairy operation in the previous calendar year, as follows:


Pounds Marketed (in millions) Administration Fee
less than 1 $100
1 to 5 $250
more than 5 to 10 $350
more than 10 to 40 $1,000
more than 40 $2,500

(3) DEPOSIT OF FEES.—All administration fees collected under this subsection shall be credited to the fund or account used to cover the costs incurred to administer the production margin protection program and the stabilization program and shall be available to the Secretary, without further appropriation and until expended, for use or transfer as provided in paragraph (4).

(4) USE OF FEES.—The Secretary shall use administration fees collected under this subsection—

(A) to cover administrative costs of the production margin protection program and stabilization program; and

(B) to cover costs of the Department of Agriculture relating to reporting of dairy market news, carrying out the amendments made by section 1476, and carrying out section 273 of the Agricultural Marketing Act of 1946 (7 U.S.C. 1637b)), to the extent funds remain available after operation of subparagraph (A).

(5) WAIVER.—The Secretary shall waive or reduce the administration fee required under paragraph (1) in the case of a limited-resource dairy operation, as defined by the Secretary.

(f) Limitation.—A dairy operation may only participate in the production margin protection program or the livestock gross margin for dairy program under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.), but not both.

SEC. 1413. Production history of participating dairy operations.

(a) Production history for basic production margin protection.—

(1) DETERMINATION REQUIRED.—For purposes of providing basic production margin protection, the Secretary shall determine the basic production history of a participating dairy operation.

(2) CALCULATION.—Except as provided in paragraph (3), the basic production history of a participating dairy operation for basic production margin protection is equal to the highest annual milk marketings of the participating dairy operation during any 1 of the 3 calendar years immediately preceding the calendar year in which the participating dairy operation first signed up to participate in the production margin protection program.

(3) ELECTION BY NEW DAIRY OPERATIONS.—In the case of a participating dairy operation that has been in operation for less than a year, the participating dairy operation shall elect 1 of the following methods for the Secretary to determine the basic production history of the participating dairy operation:

(A) The volume of the actual milk marketings for the months the participating dairy operation has been in operation extrapolated to a yearly amount.

(B) An estimate of the actual milk marketings of the participating dairy operation based on the herd size of the participating dairy operation relative to the national rolling herd average data published by the Secretary.

(4) NO CHANGE IN PRODUCTION HISTORY FOR BASIC PRODUCTION MARGIN PROTECTION.—Once the basic production history of a participating dairy operation is determined under paragraph (2) or (3), the basic production history shall not be subsequently changed for purposes of determining the amount of any basic production margin protection payments for the participating dairy operation made under section 1414.

(b) Annual production history for supplemental production margin protection.—

(1) DETERMINATION REQUIRED.—For purposes of providing supplemental production margin protection for a participating dairy operation that purchases supplemental production margin protection for a year under section 1415, the Secretary shall determine the annual production history of the participating dairy operation under paragraph (2).

(2) CALCULATION.—The annual production history of a participating dairy operation for a year is equal to the actual milk marketings of the participating dairy operation during the preceding calendar year.

(3) NEW DAIRY OPERATIONS.—Subsection (a)(3) shall apply with respect to determining the annual production history of a participating dairy operation that has been in operation for less than a year.

(c) Required information.—A participating dairy operation shall provide all information that the Secretary may require in order to establish—

(1) the basic production history of the participating dairy operation under subsection (a); and

(2) the production history of the participating dairy operation whenever the participating dairy operation purchases supplemental production margin protection under section 1415.

(d) Transfer of production histories.—

(1) TRANSFER BY SALE OR LEASE.—In promulgating the rules to initiate the production margin protection program, the Secretary shall specify the conditions under which and the manner by which the production history of a participating dairy operation may be transferred by sale or lease.

(2) COVERAGE LEVEL.—

(A) BASIC PRODUCTION MARGIN PROTECTION.—A purchaser or lessee to whom the Secretary transfers a basic production history under this subsection shall not obtain a different level of basic production margin protection than the basic production margin protection coverage held by the seller or lessor from whom the transfer was obtained.

(B) SUPPLEMENTAL PRODUCTION MARGIN PROTECTION.—A purchaser or lessee to whom the Secretary transfers an annual production history under this subsection shall not obtain a different level of supplemental production margin protection coverage than the supplemental production margin protection coverage in effect for the seller or lessor from whom the transfer was obtained for the calendar year in which the transfer was made.

(e) Movement and transfer of production history.—

(1) MOVEMENT AND TRANSFER AUTHORIZED.—Subject to paragraph (2), if a participating dairy operation moves from 1 location to another location, the participating dairy operation may transfer the basic production history and annual production history associated with the participating dairy operation.

(2) NOTIFICATION REQUIREMENT.—A participating dairy operation shall notify the Secretary of any move of a participating dairy operation under paragraph (1).

(3) SUBSEQUENT OCCUPATION OF VACATED LOCATION.—A party subsequently occupying a participating dairy operation location vacated as described in paragraph (1) shall have no interest in the basic production history or annual production history previously associated with the participating dairy operation at such location.

SEC. 1414. Basic production margin protection.

(a) Payment threshold.—The Secretary shall make a payment to participating dairy operations in accordance with subsection (b) whenever the average actual dairy production margin for a consecutive 2-month period is less than $4.00 per hundredweight of milk.

(b) Basic production margin protection payment.—The basic production margin protection payment for a participating dairy operation for a consecutive 2-month period shall be equal to the product obtained by multiplying—

(1) the difference between the average actual dairy production margin for the consecutive 2-month period and $4.00, except that, if the difference is more than $4.00, the Secretary shall use $4.00; by

(2) the lesser of—

(A) 80 percent of the production history of the participating dairy operation, divided by 6; or

(B) the actual quantity of milk marketed by the participating dairy operation during the consecutive 2-month period.

SEC. 1415. Supplemental production margin protection.

(a) Election of supplemental production margin protection.—A participating dairy operation may annually purchase supplemental production margin protection to protect, during the calendar year for which purchased, a higher level of the income of a participating dairy operation than the income level guaranteed by basic production margin protection under section 1414.

(b) Selection of payment threshold.—A participating dairy operation purchasing supplemental production margin protection for a year shall elect a coverage level that is higher, in any increment of $0.50, than the payment threshold for basic production margin protection specified in section 1414(a), but not to exceed $8.00.

(c) Coverage percentage.—A participating dairy operation purchasing supplemental production margin protection for a year shall elect a percentage of coverage equal to not more than 90 percent, nor less than 25 percent, of the annual production history of the participating dairy operation.

(d) Premiums for supplemental production margin protection.—

(1) PREMIUMS REQUIRED.—A participating dairy operation that purchases supplemental production margin protection shall pay an annual premium equal to the product obtained by multiplying—

(A) the coverage percentage elected by the participating dairy operation under subsection (c);

(B) the annual production history of the participating dairy operation; and

(C) the premium per hundredweight of milk, as specified in the applicable table under paragraph (2) or (3).

(2) PREMIUM PER HUNDREDWEIGHT FOR FIRST 4 MILLION POUNDS OF PRODUCTION.—For the first 4,000,000 pounds of milk marketings included in the annual production history of a participating dairy operation, the premium per hundredweight corresponding to each coverage level specified in the following table is as follows:


Coverage Level Premium per Cwt.
$4.50 $0.01
$5.00 $0.02
$5.50 $0.035
$6.00 $0.045
$6.50 $0.09
$7.00 $0.40
$7.50 $0.60
$8.00 $0.95

(3) PREMIUM PER HUNDREDWEIGHT FOR PRODUCTION IN EXCESS OF 4 MILLION POUNDS.—For milk marketings in excess of 4,000,000 pounds included in the annual production history of a participating dairy operation, the premium per hundredweight corresponding to each coverage level is as follows:


Coverage Level Premium per Cwt.
$4.50 $0.02
$5.00 $0.04
$5.50 $0.10
$6.00 $0.15
$6.50 $0.29
$7.00 $0.62
$7.50 $0.83
$8.00 $1.06

(4) TIME FOR PAYMENT.—In promulgating the rules to initiate the production margin protection program, the Secretary shall provide more than 1 method by which a participating dairy operation that purchases supplemental production margin protection for a calendar year may pay the premium under this subsection for that year in any manner that maximizes participating dairy operation payment flexibility and program integrity.

(e) Premium obligations.—

(1) PRO-RATION OF PREMIUM FOR NEW DAIRY OPERATIONS.—A participating dairy operation described in section 1412(c)(2) that purchases supplemental production margin protection for a calendar year after the start of the calendar year shall pay a pro-rated premium for that calendar year based on the portion of the calendar year for which the participating dairy operation purchases the coverage.

(2) LEGAL OBLIGATION.—A participating dairy operation that purchases supplemental production margin protection for a calendar year shall be legally obligated to pay the applicable premium for that calendar year, except that the Secretary may waive that obligation, under terms and conditions determined by the Secretary, for 1 or more producers in any participating dairy operation in the case of death, retirement, permanent dissolution of a participating dairy operation, or other circumstances as the Secretary considers appropriate to ensure the integrity of the program.

(f) Supplemental payment threshold.—A participating dairy operation with supplemental production margin protection shall receive a supplemental production margin protection payment whenever the average actual dairy production margin for a consecutive 2-month period is less than the coverage level threshold selected by the participating dairy operation under subsection (b).

(g) Supplemental production margin protection payments.—

(1) IN GENERAL.—The supplemental production margin protection payment for a participating dairy operation is in addition to the basic production margin protection payment.

(2) AMOUNT OF PAYMENT.—The supplemental production margin protection payment for the participating dairy operation shall be determined as follows:

(A) The Secretary shall calculate the difference between the coverage level threshold selected by the participating dairy operation under subsection (b) and the greater of—

(i) the average actual dairy production margin for the consecutive 2-month period; or

(ii) $4.00.

(B) The amount determined under subparagraph (A) shall be multiplied by the percentage selected by the participating dairy operation under subsection (c) and by the lesser of the following:

(i) The annual production history of the participating dairy operation, divided by 6.

(ii) The actual amount of milk marketed by the participating dairy operation during the consecutive 2-month period.

SEC. 1416. Effect of failure to pay administration fees or premiums.

(a) Loss of benefits.—A participating dairy operation that fails to pay the required administration fee under section 1412 or is in arrears on premium payments for supplemental production margin protection under section 1415—

(1) remains legally obligated to pay the administration fee or premiums, as the case may be; and

(2) may not receive basic production margin protection payments or supplemental production margin protection payments until the fees or premiums are fully paid.

(b) Enforcement.—The Secretary may take such action as necessary to collect administration fees and premium payments for supplemental production margin protection.

SEC. 1431. Establishment of dairy market stabilization program.

(a) Program required; purpose.—Effective not later than 120 days after the effective date of this subtitle, the Secretary shall establish and administer a dairy market stabilization program applicable to participating dairy operations for the purpose of assisting in balancing the supply of milk with demand when participating dairy operations are experiencing low or negative operating margins.

(b) Election of stabilization program base calculation method.—

(1) ELECTION.—When a dairy operation signs up under section 1412 to participate in the production margin protection program, the dairy operation shall inform the Secretary of the method by which the stabilization program base for the participating dairy operation will be calculated under paragraph (3).

(2) CHANGE IN CALCULATION METHOD.—A participating dairy operation may change the stabilization program base calculation method to be used for a calendar year by notifying the Secretary of the change not later than a date determined by the Secretary.

(3) CALCULATION METHODS.—A participating dairy operation may elect either of the following methods for calculation of the stabilization program base for the participating dairy operation:

(A) The volume of the average monthly milk marketings of the participating dairy operation for the 3 months immediately preceding the announcement by the Secretary that the stabilization program will become effective.

(B) The volume of the monthly milk marketings of the participating dairy operation for the same month in the preceding year as the month for which the Secretary has announced the stabilization program will become effective.

SEC. 1432. Threshold for implementation and reduction in dairy payments.

(a) When stabilization program required.—Except as provided in subsection (b), the Secretary shall announce that the stabilization program is in effect and order reduced payments by handlers to participating dairy operations that exceed the applicable percentage of the participating dairy operation’s stabilization program base whenever—

(1) the actual dairy production margin has been $6.00 or less per hundredweight of milk for each of the immediately preceding 2 months; or

(2) the actual dairy production margin has been $4.00 or less per hundredweight of milk for the immediately preceding month.

(b) Exception.—If any of the conditions described in section 1436(b) have been met during the 2-month period immediately preceding the month in which the announcement under subsection (a) would otherwise be made by the Secretary in the absence of this exception, the Secretary shall—

(1) suspend the stabilization program;

(2) refrain from making the announcement under subsection (a) to implement order the stabilization payment; or

(3) order reduced payments.

(c) Effective date for implementation of payment reductions.—Reductions in dairy payments shall commence beginning on the first day of the month immediately following the date of the announcement by the Secretary under subsection (a).

SEC. 1433. Milk marketings information.

(a) Collection of milk marketing data.—The Secretary shall establish, by regulation, a process to collect from participating dairy operations and handlers such information that the Secretary considers necessary for each month during which the stabilization program is in effect.

(b) Reduce regulatory burden.—When implementing the process under subsection (a), the Secretary shall minimize the regulatory burden on participating dairy operations and handlers.

SEC. 1434. Calculation and collection of reduced dairy operation payments.

(a) Reduced participating dairy operation payments required.—During any month in which payment reductions are in effect under the stabilization program, each handler shall reduce payments to each participating dairy operation from whom the handler receives milk.

(b) Reductions based on actual dairy production margin.—

(1) REDUCTION REQUIREMENT 1.—If the Secretary determines that the average actual dairy production margin has been less than $6.00 but greater than $5.00 per hundredweight of milk for 2 consecutive months, the handler shall make payments to a participating dairy operation for a month based on the greater of the following:

(A) 98 percent of the stabilization program base of the participating dairy operation.

(B) 94 percent of the marketings of milk for the month by the participating dairy operation.

(2) REDUCTION REQUIREMENT 2.—If the Secretary determines that the average actual dairy production margin has been less than $5.00 but greater than $4.00 for 2 consecutive months, the handler shall make payments to a participating dairy operation for a month based on the greater of the following:

(A) 97 percent of the stabilization program base of the participating dairy operation.

(B) 93 percent of the marketings of milk for the month by the participating dairy operation.

(3) REDUCTION REQUIREMENT 3.—If the Secretary determines that the average actual dairy production margin has been $4.00 or less for any 1 month, the handler shall make payments to a participating dairy operation for a month based on the greater of the following:

(A) 96 percent of the stabilization program base of the participating dairy operation.

(B) 92 percent of the marketings of milk for the month by the participating dairy operation.

(c) Continuation of reductions.—The largest level of payment reduction required under paragraph (1), (2), or (3) of subsection (b) shall be continued for each month until the Secretary suspends the stabilization program and terminates payment reductions in accordance with section 1436.

(d) Payment reduction exception.—Notwithstanding any preceding subsection of this section, a handler shall make no payment reductions for a participating dairy operation for a month if the participating dairy operation’s milk marketings for the month are equal to or less than the percentage of the stabilization program base applicable to the participating dairy operation under paragraph (1), (2), or (3) of subsection (b).

SEC. 1435. Remitting funds to the Secretary and use of funds.

(a) Remitting funds.—As soon as practicable after the end of each month during which payment reductions are in effect under the stabilization program, each handler shall remit to the Secretary an amount equal to the amount by which payments to participating dairy operations are reduced by the handler under section 1434.

(b) Deposit of remitted funds.—All funds received under subsection (a) shall be available to the Secretary, without further appropriation and until expended, for use or transfer as provided in subsection (c).

(c) Use of funds.—

(1) AVAILABILITY FOR CERTAIN COMMODITY DONATIONS.—Not later than 90 days after the funds described in subsection (a) are due as determined by the Secretary, the Secretary shall obligate the funds for the purpose of—

(A) purchasing dairy products for donation to food banks and other programs that the Secretary determines appropriate; and

(B) expanding consumption and building demand for dairy products.

(2) NO DUPLICATION OF EFFORT.—The Secretary shall ensure that expenditures under paragraph (1) are compatible with, and do not duplicate, programs supported by the dairy research and promotion activities conducted under the Dairy Production Stabilization Act of 1983 (7 U.S.C. 4501 et seq.).

(3) ACCOUNTING.—The Secretary shall keep an accurate account of all funds expended under paragraph (1).

(d) Annual Report.—Not later than December 31 of each year that the stabilization program is in effect, 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 provides an accurate accounting of—

(1) the funds received by the Secretary during the preceding fiscal year under subsection (a);

(2) all expenditures made by the Secretary under subsection (b) during the preceding fiscal year; and

(3) the impact of the stabilization program on dairy markets.

(e) Enforcement.—If a participating dairy operation or handler fails to remit or collect the amounts by which payments to participating dairy operations are reduced under section 1434, the participating dairy operation or handler responsible for the failure shall be liable to the Secretary for the amount that should have been remitted or collected, plus interest. In addition to the enforcement authorities available under section 1437, the Secretary may enforce this subsection in the courts of the United States.

SEC. 1436. Suspension of reduced payment requirement.

(a) Determination of prices.—For purposes of this section:

(1) The price in the United States for cheddar cheese and nonfat dry milk shall be determined by the Secretary.

(2) The world price of cheddar cheese and skim milk powder shall be determined by the Secretary.

(b) Suspension thresholds.—The stabilization program shall be suspended or the Secretary shall refrain from making the announcement under section 1432(a) if the Secretary determines that—

(1) the actual dairy production margin is greater than $6.00 per hundredweight of milk for 2 consecutive months;

(2) the actual dairy production margin is equal to or less than $6.00 (but greater than $5.00) for 2 consecutive months, and during the same 2 consecutive months—

(A) the price in the United States for cheddar cheese is equal to or greater than the world price of cheddar cheese; or

(B) the price in the United States for nonfat dry milk is equal to or greater than the world price of skim milk powder;

(3) the actual dairy production margin is equal to or less than $5.00 (but greater than $4.00) for 2 consecutive months, and during the same 2 consecutive months—

(A) the price in the United States for cheddar cheese is more than 5 percent above the world price of cheddar cheese; or

(B) the price in the United States for nonfat dry milk is more than 5 percent above the world price of skim milk powder; or

(4) the actual dairy production margin is equal to or less than $4.00 for 2 consecutive months, and during the same 2 consecutive months—

(A) the price in the United States for cheddar cheese is more than 7 percent above the world price of cheddar cheese; or

(B) the price in the United States for nonfat dry milk is more than 7 percent above the world price of skim milk powder.

(c) Implementation by handlers.—Effective on the day after the date of the announcement by the Secretary under subsection (b) of the suspension of the stabilization program, the handler shall cease reducing payments to participating dairy operations under the stabilization program.

(d) Condition on resumption of stabilization program.—Upon the announcement by the Secretary under subsection (b) that the stabilization program has been suspended, the stabilization program may not be implemented again until, at the earliest—

(1) 2 months have passed, beginning on the first day of the month immediately following the announcement by the Secretary; and

(2) the conditions of section 1432(a) are again met.

SEC. 1437. Enforcement.

(a) Unlawful act.—It shall be unlawful and a violation of the this subpart for any person subject to the stabilization program to willfully fail or refuse to provide, or delay the timely reporting of, accurate information and remittance of funds to the Secretary in accordance with this subpart.

(b) Order.—After providing notice and opportunity for a hearing to an affected person, the Secretary may issue an order against any person to cease and desist from continuing any violation of this subpart.

(c) Appeal.—An order of the Secretary under subsection (b) shall be final and conclusive unless an affected person files an appeal of the order of the Secretary in United States district court not later than 30 days after the date of the issuance of the order. A finding of the Secretary in the order shall be set aside only if the finding is not supported by substantial evidence.

(d) Noncompliance with order.—If a person subject to this subpart fails to obey an order issued under subsection (b) after the order has become final and unappealable, or after the appropriate United States district court has entered a final judgment in favor of the Secretary, the United States may apply to the appropriate United States district court for enforcement of the order. If the court determines that the order was lawfully made and duly served and that the person violated the order, the court shall enforce the order.

SEC. 1438. Audit requirements.

(a) Audits of dairy operation and handler compliance.—

(1) AUDITS AUTHORIZED.—If determined by the Secretary to be necessary to ensure compliance by participating dairy operations and handlers with the stabilization program, the Secretary may conduct periodic audits of participating dairy operations and handlers.

(2) SAMPLE OF DAIRY OPERATIONS.—Any audit conducted under this subsection shall include, at a minimum, investigation of a statistically valid and random sample of participating dairy operations.

(b) Submission of results.—The Secretary shall submit the results of any audit conducted under subsection (a) to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate and include such recommendations as the Secretary considers appropriate regarding the stabilization program.

SEC. 1439. Study; report.

(a) In general.—The Secretary shall direct the Office of the Chief Economist to conduct a study of the impacts of the program established under section 1431(a).

(b) Considerations.—The study conducted under subsection (a) shall consider—

(1) the economic impact of the program throughout the dairy product value chain, including the impact on producers, processors, domestic customers, export customers, actual market growth and potential market growth, farms of different sizes, and different regions and States; and

(2) the impact of the program on the competitiveness of the United States dairy industry in international markets.

(c) Report.—Not later than December 1, 2016, the Office of the Chief Economist 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 conducted under subsection (a).

SEC. 1451. Duration.

The production margin protection program and the stabilization program shall end on December 31, 2017.

SEC. 1452. Administration and enforcement.

(a) In general.—The Secretary shall promulgate regulations to address administrative and enforcement issues involved in carrying out the production margin protection, supplemental production margin protection, and market stabilization programs.

(b) Reconstitution and eligibility issues.—

(1) RECONSTITUTION.—Using authorities under section 1001(f) and 1001B of the Food Security Act of 1985 (7 U.S.C. 1308(f), 1308–2), the Secretary shall promulgate regulations to prohibit a dairy producer from reconstituting a dairy operation for the sole purpose of the dairy producer—

(A) receiving basic margin protection;

(B) purchasing supplemental margin protection; or

(C) avoiding participation in the market stabilization program.

(2) ELIGIBILITY ISSUES.—Using authorities under section 1001(f) and 1001B of the Food Security Act of 1985 (7 U.S.C. 1308(f), 1308–2), the Secretary shall promulgate regulations—

(A) to prohibit a scheme or device;

(B) to provide for equitable relief; and

(C) to provide for other issues affecting eligibility and liability issues.

(3) ADMINISTRATIVE APPEALS.—Using authorities under section 1001(h) of the Food Security Act of 1985 (7 U.S.C. 1308(h)) and subtitle H of the Department of Agriculture Reorganization Act (7 U.S.C. 6991 et seq.), the Secretary shall promulgate regulations to provide for administrative appeals of decisions of the Secretary that are adverse to participants of the programs described in subsection (a).

SEC. 1461. Dairy product mandatory reporting.

(a) Definitions.—Section 272(1)(A) of the Agricultural Marketing Act of 1946 (7 U.S.C. 1637a(1)(A)) is amended by inserting “, or any other products that may significantly aid price discovery in the dairy markets, as determined by the Secretary” after “of 1937”.

(b) Mandatory reporting for dairy products.—Section 273(b) of the Agricultural Marketing Act of 1946 (7 U.S.C. 1637b(b)) is amended—

(1) by striking paragraph (1) and inserting the following new paragraph:

“(1) IN GENERAL.—In establishing the program, the Secretary shall only—

“(A)(i) subject to the conditions described in paragraph (2), require each manufacturer to report to the Secretary, more frequently than once per month, information concerning the price, quantity, and moisture content of dairy products sold by the manufacturer and any other product characteristics that may significantly aid price discovery in the dairy markets, as determined by the Secretary; and

“(ii) modify the format used to provide the information on the day before the date of enactment of this subtitle to ensure that the information can be readily understood by market participants; and

“(B) require each manufacturer and other person storing dairy products (including dairy products in cold storage) to report to the Secretary, more frequently than once per month, information on the quantity of dairy products stored.”; and

(2) in paragraph (2), by inserting “or those that may significantly aid price discovery in the dairy markets” after “Federal milk marketing order” each place it appears in subparagraphs (A), (B), and (C).

SEC. 1462. Federal milk marketing order information.

(a) Information clearinghouse.—

(1) IN GENERAL.—The Secretary shall, on behalf of each milk marketing order issued under the Agricultural Adjustment Act (7 U.S.C. 601 et seq.), reenacted with amendments by the Agricultural Marketing Agreement Act of 1937, establish an information clearinghouse for the purposes of educating the public about the Federal milk marketing order system and any marketing order referenda, including proposal information and timelines that shall be kept current and updated as information becomes available.

(2) REQUIREMENTS.—Information under paragraph (1) shall include—

(A) information on procedures by which cooperatives vote;

(B) if applicable, information on the manner by which producers may cast an individual ballot;

(C) in applicable, instructions on the manner in which to vote online;

(D) due dates for each specific referendum;

(E) the text of each referendum question under consideration;

(F) a description in plain language of the question;

(G) any relevant background information to the question; and

(H) any other information that increases Federal milk marketing order transparency.

(b) Notification list for upcoming referendum.—Each Federal milk marketing order shall—

(1) make available the information described in subsection (b) through an Internet site; and

(2) publicize the information in major agriculture and dairy-specific publications on upcoming referenda.

(c) Study.—

(1) IN GENERAL.—The Secretary shall conduct a study of the feasibility of establishing 2 classes of milk, a fluid class and a manufacturing class, to replace the 4–class system in effect on the date of enactment of this Act in administering Federal milk marketing orders.

(2) FEDERAL MILK MARKET ORDER REVIEW COMMISSION.—The Secretary may elect to use the Federal Milk Market Order Review Commission established under section 1509(a) of the Food, Conservation, and Energy Act of 2008 (Public Law 110–246; 122 Stat. 1726), or documents of the Commission, to conduct all or part of the study.

(3) REPORT.—Not later than 180 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 required under this subsection, including any recommendations.

SEC. 1471. Repeal of dairy product price support and milk income loss contract programs.

(a) Repeal of dairy product price support program.—Section 1501 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8771) is repealed.

(b) Repeal of milk income loss contract program.—

(1) PAYMENTS UNDER MILK INCOME LOSS CONTRACT PROGRAM.—Section 1506(c)(3) of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8773(c)(3)) is amended—

(A) in subparagraph (A), by inserting “and” after the semicolon;

(B) in subparagraph (B), by striking “August 31, 2012, 45 percent; and” and inserting “June 30, 2013, 45 percent.”; and

(C) by striking subparagraph (C).

(2) EXTENSION.—Section 1506(h)(1) of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8773(h)(1)) is amended by striking “September 30, 2012” and inserting “June 30, 2013”.

(3) REPEAL.—Effective July 1, 2013, section 1506 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8773) is repealed.

SEC. 1472. Repeal of dairy export incentive program.

(a) Repeal.—Section 153 of the Food Security Act of 1985 (15 U.S.C. 713a–14) is repealed.

(b) Conforming amendments.—Section 902(2) of the Trade Sanctions Reform and Export Enhancement Act of 2000 (22 U.S.C. 7201(2)) is amended—

(1) by striking subparagraph (D); and

(2) by redesignating subparagraphs (E) and (F) as subparagraphs (D) and (E), respectively.

SEC. 1473. Extension of dairy forward pricing program.

Section 1502(e) of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8772(e)) is amended—

(1) in paragraph (1), by striking “2012” and inserting “2017”; and

(2) in paragraph (2), by striking “2015” and inserting “2020”.

SEC. 1474. Extension of dairy indemnity program.

Section 3 of Public Law 90–484 (7 U.S.C. 450l) is amended by striking “2012” and inserting “2017”.

SEC. 1475. Extension of dairy promotion and research program.

Section 113(e)(2) of the Dairy Production Stabilization Act of 1983 (7 U.S.C. 4504(e)(2)) is amended by striking “2012” and inserting “2017”.

SEC. 1476. Extension of Federal Milk Marketing Order Review Commission.

Section 1509(a) of the Food, Conservation, and Energy Act of 2008 (Public Law 110–246; 122 Stat. 1726) is amended by inserting “or other funds” after “Subject to the availability of appropriations”.

SEC. 1481. Federal milk marketing orders.

(a) Amendments.—The Secretary shall provide an analysis on the effects of amending each Federal milk marketing order issued under section 8c of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with amendments by the Agricultural Marketing Agreement Act of 1937 (in this part referred to as a “milk marketing order”), as required by this section.

(b) Use of end-product price formulas.—In carrying out subsection (a), the Secretary shall—

(1) consider replacing the use of end-product price formulas with other pricing alternatives; 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 describing the findings of the Secretary on the impact of the action considered under paragraph (1).

SEC. 1491. Effective date.

Except as otherwise provided in this subtitle, this subtitle and the amendments made by this subtitle take effect on October 1, 2012.

SEC. 1501. Supplemental agricultural disaster assistance programs.

(a) Definitions.—In this section:

(1) ELIGIBLE PRODUCER ON A FARM.—

(A) IN GENERAL.—The term “eligible producer on a farm” means an individual or entity described in subparagraph (B) that, as determined by the Secretary, assumes the production and market risks associated with the agricultural production of crops or livestock.

(B) DESCRIPTION.—An individual or entity referred to in subparagraph (A) is—

(i) a citizen of the United States;

(ii) a resident alien;

(iii) a partnership of citizens of the United States; or

(iv) a corporation, limited liability corporation, or other farm organizational structure organized under State law.

(2) FARM.—

(A) IN GENERAL.—The term “farm” means, in relation to an eligible producer on a farm, the total of all crop acreage in all counties that is planted or intended to be planted for harvest, for sale, or on-farm livestock feeding (including native grassland intended for haying) by the eligible producer.

(B) AQUACULTURE.—In the case of aquaculture, the term “farm” means, in relation to an eligible producer on a farm, all fish being produced in all counties that are intended to be harvested for sale by the eligible producer.

(C) HONEY.—In the case of honey, the term “farm” means, in relation to an eligible producer on a farm, all bees and beehives in all counties that are intended to be harvested for a honey crop for sale by the eligible producer.

(3) FARM-RAISED FISH.—The term “farm-raised fish” means any aquatic species that is propagated and reared in a controlled environment.

(4) LIVESTOCK.—The term “livestock” includes—

(A) cattle (including dairy cattle);

(B) bison;

(C) poultry;

(D) sheep;

(E) swine;

(F) horses; and

(G) other livestock, as determined by the Secretary.

(b) Livestock indemnity payments.—

(1) PAYMENTS.—For each of fiscal years 2012 through 2017, the Secretary shall use such sums as are necessary of the funds of the Commodity Credit Corporation to make livestock indemnity payments to eligible producers on farms that have incurred livestock death losses in excess of the normal mortality, as determined by the Secretary, due to—

(A) attacks by animals reintroduced into the wild by the Federal Government or protected by Federal law, including wolves; or

(B) adverse weather, as determined by the Secretary, during the calendar year, including losses due to hurricanes, floods, blizzards, disease, wildfires, extreme heat, and extreme cold.

(2) PAYMENT RATES.—Indemnity payments to an eligible producer on a farm under paragraph (1) shall be made at a rate of 65 percent of the market value of the applicable livestock on the day before the date of death of the livestock, as determined by the Secretary.

(3) SPECIAL RULE FOR PAYMENTS MADE DUE TO DISEASE.—The Secretary shall ensure that payments made to an eligible producer under paragraph (1) are not made for the same livestock losses for which compensation is provided pursuant to section 10407(d) of the Animal Health Protection Act (7 U.S.C. 8306(d)).

(c) Livestock forage disaster program.—

(1) ESTABLISHMENT.—There is established a livestock forage disaster program to provide 1 source for livestock forage disaster assistance for weather-related forage losses, as determined by the Secretary, by combining—

(A) the livestock forage assistance functions of—

(i) the noninsured crop disaster assistance program established by section 196 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333); and

(ii) the emergency assistance for livestock, honey bees, and farm-raised fish program under section 531(e) of the Federal Crop Insurance Act (7 U.S.C. 1531(e)) (as in existence on the day before the date of enactment of this Act); and

(B) the livestock forage disaster program under section 531(d) of the Federal Crop Insurance Act (7 U.S.C. 1531(d)) (as in existence on the day before the date of enactment of this Act).

(2) DEFINITIONS.—In this subsection:

(A) COVERED LIVESTOCK.—

(i) IN GENERAL.—Except as provided in clause (ii), the term “covered livestock” means livestock of an eligible livestock producer that, during the 60 days prior to the beginning date of an eligible forage loss, as determined by the Secretary, the eligible livestock producer—

(I) owned;

(II) leased;

(III) purchased;

(IV) entered into a contract to purchase;

(V) was a contract grower; or

(VI) sold or otherwise disposed of due to an eligible forage loss during—

(aa) the current production year; or

(bb) subject to paragraph (4)(B)(ii), 1 or both of the 2 production years immediately preceding the current production year.

(ii) EXCLUSION.—The term “covered livestock” does not include livestock that were or would have been in a feedlot, on the beginning date of the eligible forage loss, as a part of the normal business operation of the eligible livestock producer, as determined by the Secretary.

(B) DROUGHT MONITOR.—The term “drought monitor” means a system for classifying drought severity according to a range of abnormally dry to exceptional drought, as defined by the Secretary.

(C) ELIGIBLE FORAGE LOSS.—The term “eligible forage loss” means 1 or more forage losses that occur due to weather-related conditions, including drought, flood, blizzard, hail, excessive moisture, hurricane, and fire, occurring during the normal grazing period, as determined by the Secretary, if the forage—

(i) is grown on land that is native or improved pastureland with permanent vegetative cover; or

(ii) is a crop planted specifically for the purpose of providing grazing for covered livestock of an eligible livestock producer.

(D) ELIGIBLE LIVESTOCK PRODUCER.—

(i) IN GENERAL.—The term “eligible livestock producer” means an eligible producer on a farm that—

(I) is an owner, cash or share lessee, or contract grower of covered livestock that provides the pastureland or grazing land, including cash-leased pastureland or grazing land, for the covered livestock;

(II) provides the pastureland or grazing land for covered livestock, including cash-leased pastureland or grazing land that is physically located in a county affected by an eligible forage loss;

(III) certifies the eligible forage loss; and

(IV) meets all other eligibility requirements established under this subsection.

(ii) EXCLUSION.—The term “eligible livestock producer” does not include an owner, cash or share lessee, or contract grower of livestock that rents or leases pastureland or grazing land owned by another person on a rate-of-gain basis.

(E) NORMAL CARRYING CAPACITY.—The term “normal carrying capacity”, with respect to each type of grazing land or pastureland in a county, means the normal carrying capacity, as determined under paragraph (4)(D)(i), that would be expected from the grazing land or pastureland for livestock during the normal grazing period, in the absence of an eligible forage loss that diminishes the production of the grazing land or pastureland.

(F) NORMAL GRAZING PERIOD.—The term “normal grazing period”, with respect to a county, means the normal grazing period during the calendar year for the county, as determined under paragraph (4)(D)(i).

(3) PROGRAM.—For each of fiscal years 2012 through 2017, the Secretary shall use such sums as are necessary of the funds of the Commodity Credit Corporation to provide compensation under paragraphs (4) through (6), as determined by the Secretary for eligible forage losses affecting covered livestock of eligible livestock producers.

(4) ASSISTANCE FOR ELIGIBLE FORAGE LOSSES DUE TO DROUGHT CONDITIONS.—

(A) ELIGIBLE FORAGE LOSSES.—

(i) IN GENERAL.—An eligible livestock producer of covered livestock may receive assistance under this paragraph for eligible forage losses that occur due to drought on land that—

(I) is native or improved pastureland with permanent vegetative cover; or

(II) is planted to a crop planted specifically for the purpose of providing grazing for covered livestock.

(ii) EXCLUSIONS.—An eligible livestock producer may not receive assistance under this paragraph for eligible forage losses that occur on land used for haying or grazing under 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.), unless the land is grassland eligible for the conservation reserve program under section 1231(d)(2) of the Food Security Act of 1985 (16 U.S.C. 3831(d)(2)) (as amended by section 2001 of this Act).

(B) MONTHLY PAYMENT RATE.—

(i) IN GENERAL.—Except as provided in clause (ii), the payment rate for assistance for 1 month under this paragraph shall, in the case of drought, be equal to 60 percent of the lesser of—

(I) the monthly feed cost for all covered livestock owned or leased by the eligible livestock producer, as determined under subparagraph (C); or

(II) the monthly feed cost calculated by using the normal carrying capacity of the eligible grazing land of the eligible livestock producer.

(ii) PARTIAL COMPENSATION.—In the case of an eligible livestock producer that sold or otherwise disposed of covered livestock due to drought conditions in 1 or both of the 2 production years immediately preceding the current production year, as determined by the Secretary, the payment rate shall be 80 percent of the payment rate otherwise calculated in accordance with clause (i).

(C) MONTHLY FEED COST.—

(i) IN GENERAL.—The monthly feed cost shall equal the product obtained by multiplying—

(I) 30 days;

(II) a payment quantity that is equal to the feed grain equivalent, as determined under clause (ii); and

(III) a payment rate that is equal to the corn price per pound, as determined under clause (iii).

(ii) FEED GRAIN EQUIVALENT.—For purposes of clause (i)(II), the feed grain equivalent shall equal—

(I) in the case of an adult beef cow, 15.7 pounds of corn per day; or

(II) in the case of any other type of weight of livestock, an amount determined by the Secretary that represents the average number of pounds of corn per day necessary to feed the livestock.

(iii) CORN PRICE PER POUND.—For purposes of clause (i)(III), the corn price per pound shall equal the quotient obtained by dividing—

(I) the higher of—

(aa) the national average corn price per bushel for the 12-month period immediately preceding March 1 of the year for which the disaster assistance is calculated; or

(bb) the national average corn price per bushel for the 24-month period immediately preceding that March 1; by

(II) 56.

(D) NORMAL GRAZING PERIOD AND DROUGHT MONITOR INTENSITY.—

(i) FSA COUNTY COMMITTEE DETERMINATIONS.—

(I) IN GENERAL.—The Secretary shall determine the normal carrying capacity and normal grazing period for each type of grazing land or pastureland in the county served by the applicable Farm Service Agency committee.

(II) CHANGES.—No change to the normal carrying capacity or normal grazing period established for a county under subclause (I) shall be made unless the change is requested by the appropriate State and county Farm Service Agency committees.

(ii) DROUGHT INTENSITY.—

(I) D2.—An eligible livestock producer that owns or leases grazing land or pastureland that is physically located in a county that is rated by the U.S. Drought Monitor as having a D2 (severe drought) intensity in any area of the county for at least 8 consecutive weeks during the normal grazing period for the county, as determined by the Secretary, shall be eligible to receive assistance under this paragraph in an amount equal to 1 monthly payment using the monthly payment rate determined under subparagraph (B).

(II) D3.—An eligible livestock producer that owns or leases grazing land or pastureland that is physically located in a county that is rated by the U.S. Drought Monitor as having at least a D3 (extreme drought) intensity in any area of the county at any time during the normal grazing period for the county, as determined by the Secretary, shall be eligible to receive assistance under this paragraph—

(aa) in an amount equal to 3 monthly payments using the monthly payment rate determined under subparagraph (B);

(bb) if the county is rated as having a D3 (extreme drought) intensity in any area of the county for at least 4 weeks during the normal grazing period for the county, or is rated as having a D4 (exceptional drought) intensity in any area of the county at any time during the normal grazing period, in an amount equal to 4 monthly payments using the monthly payment rate determined under subparagraph (B); or

(cc) if the county is rated as having a D4 (exceptional drought) intensity in any area of the county for at least 4 weeks during the normal grazing period, in an amount equal to 5 monthly payments using the monthly rate determined under subparagraph (B).

(iii) ANNUAL PAYMENT BASED ON DROUGHT CONDITIONS DETERMINED BY MEANS OTHER THAN THE U.S. DROUGHT MONITOR.—

(I) IN GENERAL.—An eligible livestock producer that owns grazing land or pastureland that is physically located in a county that has experienced on average, over the preceding calendar year, precipitation levels that are 50 percent or more below normal levels, according to sufficient documentation as determined by the Secretary, may be eligible, subject to a determination by the Secretary, to receive assistance under this paragraph in an amount equal to not more than 1 monthly payment using the monthly payment rate under subparagraph (B).

(II) NO DUPLICATE PAYMENT.—A producer may not receive a payment under both clause (ii) and this clause.

(5) ASSISTANCE FOR LOSSES DUE TO FIRE ON PUBLIC MANAGED LAND.—

(A) IN GENERAL.—An eligible livestock producer may receive assistance under this paragraph only if—

(i) the eligible forage losses occur on rangeland that is managed by a Federal agency; and

(ii) the eligible livestock producer is prohibited by the Federal agency from grazing the normal permitted livestock on the managed rangeland due to a fire.

(B) PAYMENT RATE.—The payment rate for assistance under this paragraph shall be equal to 50 percent of the monthly feed cost for the total number of livestock covered by the Federal lease of the eligible livestock producer, as determined under paragraph (4)(C).

(C) PAYMENT DURATION.—

(i) IN GENERAL.—Subject to clause (ii), an eligible livestock producer shall be eligible to receive assistance under this paragraph for the period—

(I) beginning on the date on which the Federal agency excludes the eligible livestock producer from using the managed rangeland for grazing; and

(II) ending on the last day of the Federal lease of the eligible livestock producer.

(ii) LIMITATION.—An eligible livestock producer may only receive assistance under this paragraph for losses that occur on not more than 180 days per year.

(6) ASSISTANCE FOR ELIGIBLE FORAGE LOSSES DUE TO OTHER THAN DROUGHT OR FIRE.—

(A) ELIGIBLE FORAGE LOSSES.—

(i) IN GENERAL.—Subject to subparagraph (B), an eligible livestock producer of covered livestock may receive assistance under this paragraph for eligible forage losses that occur due to weather-related conditions other than drought or fire on land that—

(I) is native or improved pastureland with permanent vegetative cover; or

(II) is planted to a crop planted specifically for the purpose of providing grazing for covered livestock.

(ii) EXCLUSIONS.—An eligible livestock producer may not receive assistance under this paragraph for eligible forage losses that occur on land used for haying or grazing under 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.), unless the land is grassland eligible for the conservation reserve program under section 1231(d)(2) of the Food Security Act of 1985 (16 U.S.C. 3831(d)(2)) (as amended by section 2001 of this Act).

(B) PAYMENTS FOR ELIGIBLE FORAGE LOSSES.—

(i) IN GENERAL.—The Secretary shall provide assistance under this paragraph to an eligible livestock producer for eligible forage losses that occur due to weather-related conditions other than—

(I) drought under paragraph (4); and

(II) fire on public managed land under paragraph (5).

(ii) TERMS AND CONDITIONS.—The Secretary shall establish terms and conditions for assistance under this paragraph that are consistent with the terms and conditions for assistance under this subsection.

(7) NO DUPLICATIVE PAYMENTS.—An eligible livestock producer may elect to receive assistance for eligible forage losses under either paragraph (4), (5), or (6), if applicable, but may not receive assistance under more than 1 of those paragraphs for the same loss, as determined by the Secretary.

(8) DETERMINATIONS BY SECRETARY.—A determination made by the Secretary under this subsection shall be final and conclusive.

(d) Emergency assistance for livestock, honey bees, and farm-raised fish.—

(1) IN GENERAL.—For each of fiscal years 2012 through 2017, the Secretary shall use not more than $5,000,000 of the funds of the Commodity Credit Corporation to provide emergency relief to eligible producers of livestock, honey bees, and farm-raised fish to aid in the reduction of losses due to disease, adverse weather, or other conditions, such as blizzards and wildfires, as determined by the Secretary, that are not covered under subsection (b) or (c).

(2) USE OF FUNDS.—Funds made available under this subsection shall be used to reduce losses caused by feed or water shortages, disease, or other factors as determined by the Secretary.

(3) AVAILABILITY OF FUNDS.—Any funds made available under this subsection shall remain available until expended.

(e) Tree assistance program.—

(1) DEFINITIONS.—In this subsection:

(A) ELIGIBLE ORCHARDIST.—The term “eligible orchardist” means a person that produces annual crops from trees for commercial purposes.

(B) NATURAL DISASTER.—The term “natural disaster” means plant disease, insect infestation, drought, fire, freeze, flood, earthquake, lightning, or other occurrence, as determined by the Secretary.

(C) NURSERY TREE GROWER.—The term “nursery tree grower” means a person who produces nursery, ornamental, fruit, nut, or Christmas trees for commercial sale, as determined by the Secretary.

(D) TREE.—The term “tree” includes a tree, bush, and vine.

(2) ELIGIBILITY.—

(A) LOSS.—Subject to subparagraph (B), for each of fiscal years 2012 through 2017, the Secretary shall use such sums as are necessary of the funds of the Commodity Credit Corporation to provide assistance—

(i) under paragraph (3) to eligible orchardists and nursery tree growers that planted trees for commercial purposes but lost the trees as a result of a natural disaster, as determined by the Secretary; and

(ii) under paragraph (3)(B) to eligible orchardists and nursery tree growers that have a production history for commercial purposes on planted or existing trees but lost the trees as a result of a natural disaster, as determined by the Secretary.

(B) LIMITATION.—An eligible orchardist or nursery tree grower shall qualify for assistance under subparagraph (A) only if the tree mortality of the eligible orchardist or nursery tree grower, as a result of damaging weather or related condition, exceeds 15 percent (adjusted for normal mortality).

(3) ASSISTANCE.—Subject to paragraph (4), the assistance provided by the Secretary to eligible orchardists and nursery tree growers for losses described in paragraph (2) shall consist of—

(A)(i) reimbursement of 65 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

(ii) at the option of the Secretary, sufficient seedlings to reestablish a stand; and

(B) reimbursement of 50 percent of the cost of pruning, removal, and other costs incurred by an eligible orchardist or nursery tree grower to salvage existing trees or, in the case of tree mortality, to prepare the land to replant trees as a result of damage or tree mortality due to a natural disaster, as determined by the Secretary, in excess of 15 percent damage or mortality (adjusted for normal tree damage and mortality).

(4) LIMITATIONS ON ASSISTANCE.—

(A) DEFINITIONS OF LEGAL ENTITY AND PERSON.—In this paragraph, the terms “legal entity” and “person” have the meaning given those terms in section 1001(a) of the Food Security Act of 1985 (7 U.S.C. 1308(a)).

(B) AMOUNT.—The total amount of payments received, directly or indirectly, by a person or legal entity (excluding a joint venture or general partnership) under this subsection may not exceed $100,000 for any crop year, or an equivalent value in tree seedlings.

(C) ACRES.—The total quantity of acres planted to trees or tree seedlings for which a person or legal entity shall be entitled to receive payments under this subsection may not exceed 500 acres.

(f) Payments.—

(1) PAYMENT LIMITATIONS.—

(A) DEFINITIONS OF LEGAL ENTITY AND PERSON.—In this subsection, the terms “legal entity” and “person” have the meanings given those terms in section 1001(a) of the Food Security Act of 1985 (7 U.S.C. 1308(a)).

(B) AMOUNT.—The total amount of disaster assistance payments received, directly or indirectly, by a person or legal entity (excluding a joint venture or general partnership) under this section (excluding payments received under subsection (e)) may not exceed $100,000 for any crop year.

(C) DIRECT ATTRIBUTION.—Subsections (d) and (e) of section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308) or any successor provisions relating to direct attribution shall apply with respect to assistance provided under this section.

(2) PAYMENT DELIVERY.—The Secretary shall make payments under this section after October 1, 2013, for losses incurred in the 2012 and 2013 fiscal years, and as soon as practicable for losses incurred in any year thereafter.

SEC. 1601. Administration generally.

(a) Use of Commodity Credit Corporation.—The Secretary shall use the funds, facilities, and authorities of the Commodity Credit Corporation to carry out this title.

(b) Determinations by Secretary.—A determination made by the Secretary under this title shall be final and conclusive.

(c) Regulations.—

(1) IN GENERAL.—Except as otherwise provided in this subsection, not later than 90 days after the date of enactment of this Act, the Secretary and the Commodity Credit Corporation, as appropriate, shall promulgate such regulations as are necessary to implement this title and the amendments made by this title.

(2) PROCEDURE.—The promulgation of the regulations and administration of this title and the amendments made by this title and sections 11001 and 11011 of this Act shall be made without regard to—

(A) the notice and comment provisions of section 553 of title 5, United States Code;

(B) chapter 35 of title 44, United States Code (commonly known as the “Paperwork Reduction Act”); and

(C) 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.

(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) Adjustment Authority Related to Trade Agreements Compliance.—

(1) REQUIRED DETERMINATION; ADJUSTMENT.—If the Secretary determines that expenditures under this title 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)) will exceed the allowable levels for any applicable reporting period, the Secretary shall, to the maximum extent practicable, make adjustments in the amount of the expenditures during that period to ensure that the expenditures do not exceed the allowable levels.

(2) CONGRESSIONAL NOTIFICATION.—Before making any adjustment under paragraph (1), 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 determination made under that paragraph and the extent of the adjustment to be made.

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 2013 through 2017 crops of covered commodities (as defined in section 1104), cotton, and sugar and shall not be applicable to milk during the period beginning on the date of enactment of this Act through December 31, 2017:

(1) Parts II through V of subtitle B of title III (7 U.S.C. 1326 et seq.).

(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 et seq.).

(4) Title IV (7 U.S.C. 1401 et seq.).

(b) Agricultural Act of 1949.—The following provisions of the Agricultural Act of 1949 shall not be applicable to the 2013 through 2017 crops of covered commodities (as defined in section 1104), cotton, 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, 2017:

(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 et seq.).

(10) Title IV (7 U.S.C. 1421 et seq.), other than sections 404, 412, and 416 (7 U.S.C. 1424, 1429, and 1431).

(11) Title V (7 U.S.C. 1461 et seq.).

(12) Title VI (7 U.S.C. 1471 et seq.).

(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 2013 through 2017.

SEC. 1603. Payment limitations.

(a) In general.—Section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308) is amended by striking subsections (b) and (c) and inserting the following:

“(b) Limitation on payments for peanuts and other covered commodities.—The total amount of payments received, directly or indirectly, by a person or legal entity (except a joint venture or general partnership) for any crop year under title I of subtitle A of the Agriculture Reform, Food, and Jobs Act of 2012 for—

“(1) peanuts may not exceed $50,000; and

“(2) 1 or more other covered commodities may not exceed $50,000.”.

(b) Limitation on marketing loan gains and loan deficiency payments for peanuts and other covered commodities.—Section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308) is amended by striking subsection (d) and inserting the following:

“(d) Limitation on marketing loan gains and loan deficiency payments for peanuts and other covered commodities.—The total amount of marketing loan gains and loan deficiency payments received, directly or indirectly, by a person or legal entity (except a joint venture or general partnership) for any crop year under subtitle B of the Agriculture Reform, Food, and Jobs Act of 2012 (or a successor provision) for—

“(1) peanuts may not exceed $75,000; and

“(2) 1 or more other covered commodities may not exceed $75,000.”.

(c) Conforming amendments.—

(1) Section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308) is amended—

(A) in subsection (a)(1), by striking “section 1001 of the Food, Conservation, and Energy Act of 2008” and inserting “section 1104 of the Agriculture Reform, Food, and Jobs Act of 2012”;

(B) in subsection (d), by inserting “or title I of the Agriculture Reform, Food, and Jobs Act of 2012” before the period at the end;

(C) in subsection (e)—

(i) in paragraph (1), by striking “subsections (b) and (c) and a program described in paragraphs (1)(C)” and inserting “subsection (b) and a program described in paragraph (1)(B)”; and

(ii) in paragraph (3)(B), by striking “subsections (b) and (c)” each place it appears and inserting “subsection (b)”;

(D) in subsection (f)—

(i) by striking “or title XII” each place it appears in paragraphs (5)(A) and (6)(A) and inserting “, title I of the Agriculture Reform, Food, and Jobs Act of 2012, or title XII”;

(ii) in paragraph (2), by striking “Subsections (b) and (c)” and inserting “Subsection (b)”;

(iii) in paragraph (4)(B), by striking “subsection (b) or (c)” and inserting “subsection (b)”;

(iv) in paragraph (5)—

(I) in subparagraph (A), by striking “subsection (d)” and inserting “subsection (c)”; and

(II) in subparagraph (B), by striking “subsection (b), (c), or (d)” and inserting “subsection (b) or (c)”; and

(v) in paragraph (6)—

(I) in subparagraph (A), by striking “subsection (d), except as provided in subsection (g)” and inserting “subsection (c), except as provided in subsection (f)”; and

(II) in subparagraph (B), by striking “subsections (b), (c), and (d)” and inserting “subsections (b) and (c)”;

(E) in subsection (g)—

(i) in paragraph (1)—

(I) bv striking “subsection (f)(6)(A)” and inserting “subsection (e)(6)(A)” and

(II) by striking “subsection (b) or (c)” and inserting “subsection (b)”; and

(ii) in paragraph (2)(A), by striking “subsections (b) and (c)” and inserting “subsection (b)”; and

(F) by redesignating subsections (d) through (h) as subsections (c) through (g), respectively.

(2) Section 1001A of the Food Security Act of 1985 (7 U.S.C. 1308–1) is amended—

(A) in subsection (a), by striking “subsections (b) and (c)” and inserting “subsection (b)”; and

(B) in subsection (b)(1), by striking “subsection (b) or (c)” and inserting “subsection (b)”.

(3) Section 1001B(a) of the Food Security Act of 1985 (7 U.S.C. 1308–2(a)) is amended in the matter preceding paragraph (1) by striking “subsections (b) and (c)” and inserting “subsection (b)”.

(4) 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 Agriculture Reform, Food, and Jobs Act of 2012,” after “2008,”.

(d) Application.—The amendments made by this section shall apply beginning with the 2013 crop year.

SEC. 1604. Payments limited to active farmers.

Section 1001A of the Food Security Act of 1985 (7 U.S.C. 1308–1) is amended—

(1) in subsection (b)(2)—

(A) by striking “or active personal management” each place it appears in subparagraphs (A)(i)(II) and (B)(ii); and

(B) in subparagraph (C), by striking “, as applied to the legal entity, are met by the legal entity, the partners or members making a significant contribution of personal labor or active personal management” and inserting “are met by partners or members making a significant contribution of personal labor, those partners or members”; and

(2) in subsection (c)—

(A) in paragraph (1)—

(i) by striking subparagraph (A) and inserting the following:

“(A) the landowner share-rents the land at a rate that is usual and customary;”;

(ii) in subparagraph (B), by striking the period at the end and inserting “; and”; and

(iii) by adding at the end the following:

“(C) the share of the payments received by the landowner is commensurate with the share of the crop or income received as rent.”;

(B) in paragraph (2)(A), by striking “active personal management or”;

(C) in paragraph (5)—

(i) by striking “(5)” and all that follows through “(A) In general.—A person” and inserting the following:

“(5) CUSTOM FARMING SERVICES.—A person”;

(ii) by inserting “under usual and customary terms” after “services”; and

(iii) by striking subparagraph (B); and

(D) by adding at the end the following:

“(7) FARM MANAGERS.—A person who otherwise meets the requirements of this subsection other than (b)(2)(A)(i)(II) shall be considered to be actively engaged in farming, as determined by the Secretary, with respect to the farming operation, including a farming operation that is a sole proprietorship, a legal entity such as a joint venture or general partnership, or a legal entity such as a corporation or limited partnership, if the person—

“(A) makes a significant contribution of management to the farming operation necessary for the farming operation, taking into account—

“(i) the size and complexity of the farming operation; and

“(ii) the management requirements normally and customarily required by similar farming operations;

“(B) is the only person in the farming operation qualifying as actively engaged in farming;

“(C) does not use the management contribution under this paragraph to qualify as actively engaged in more than 1 farming operation; and

“(D) manages a farm operation that does not substantially share equipment, labor, or management with persons or legal entities that with the person collectively receive, directly or indirectly, an amount equal to more than the applicable limits under section 1001(b).”.

SEC. 1605. Adjusted gross income limitation.

(a) In general.—Section 1001D(b)) of the Food Security Act of 1985 (7 U.S.C. 1308–3a(b)) is amended by striking paragraph (1) and inserting the following:

“(1) COMMODITY PROGRAMS.—

“(A) LIMITATION.—Notwithstanding any other provision of law, a person or legal entity shall not be eligible to receive any benefit described in subparagraph (B) during a crop, fiscal or program year, as appropriate, if the average adjusted gross income (or comparable measure over the 3 taxable years preceding the most immediately preceding complete taxable year, as determined by the Secretary) of the person or legal entity exceeds $750,000.

“(B) COVERED BENEFITS.—Subparagraph (A) applies with respect to the following:

“(i) A payment under section 1105 of the Agriculture Reform, Food, and Jobs Act of 2012.

“(ii) A marketing loan gain or loan deficiency payment under subtitle B of title I of the Agriculture Reform, Food, and Jobs Act of 2012.

“(iii) A payment under subtitle E of the Agriculture Reform, Food, and Jobs Act of 2012”..”.

“(iv) A payment under section 196 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333).”.

(b) Application.—The amendments made by this section shall apply beginning with the 2013 crop year.

SEC. 1606. Geographically disadvantaged farmers and ranchers.

Section 1621(d) of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8792(d)) is amended by striking “2012” and inserting “2017”.

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 “and title I of the Food, Conservation, and Energy Act of 2008” each place it appears and inserting “title I of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8702 et seq.), and title I of the Agriculture Reform, Food, and Jobs Act of 2012”.

SEC. 1608. Prevention of deceased individuals receiving payments under farm commodity programs.

(a) Reconciliation.—At least twice each year, the Secretary shall reconcile social security numbers of all individuals who receive payments under this title, whether directly or indirectly, with the Commissioner of Social Security to determine if the individuals are alive.

(b) Preclusion.—The Secretary shall preclude the issuance of payments to, and on behalf of, deceased individuals that were not eligible for payments.

SEC. 1609. Appeals.

(a) Direction, control, and support.—Section 272 of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6992) is amended by striking subsection (c) and inserting the following:

“(c) Direction, control, and support.—

“(1) DIRECTION AND CONTROL.—

“(A) IN GENERAL.—Except as provided in paragraph (2), the Director shall be free from the direction and control of any person other than the Secretary or the Deputy Secretary of Agriculture.

“(B) ADMINISTRATIVE SUPPORT.—The Division shall not receive administrative support (except on a reimbursable basis) from any agency other than the Office of the Secretary.

“(C) PROHIBITION ON DELEGATION.—The Secretary may not delegate to any other officer or employee of the Department, other than the Deputy Secretary of Agriculture or the Director, the authority of the Secretary with respect to the Division.

“(2) EXCEPTION.—The Assistant Secretary for Administration is authorized to investigate, enforce, and implement the provisions in law, Executive order, or regulations that relate in general to competitive and excepted service positions and employment within the Division, including the position of Director, and such authority may be further delegated to subordinate officials.”.

(b) Determination of appealability of agency decisions.—Section 272 of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6992) is amended by striking subsection (d) and inserting the following:

“(d) Determination of appealability of agency decisions.—

“(1) DEFINITION OF A MATTER OF GENERAL APPLICABILITY.—In this subsection, the term ‘a matter of general applicability’ means a matter that challenges the merits or authority of a rule, procedure, local or national program practice, or determination of an agency that applies, or can apply, to more than 1 interested party as opposed to the particular application of the rule, procedure, or practice to a specific set of facts or the facts themselves as the facts apply to 1 particular interested party.

“(2) MATTERS NOT SUBJECT TO APPEAL.—The Division may not hear appeals—

“(A) unless the determination of the agency is adverse to the appellant;

“(B) that involve matters of general applicability; and

“(C) that involve requests for equitable relief unless the equitable relief has been denied by the agency.

“(3) EQUITABLE RELIEF.—

“(A) IN GENERAL.—An appeal requesting equitable relief may not be granted by the Director to an appellant unless, using the rules and practices that the agency applies to itself, the agency could in fact have granted the relief because the appellant acted in good faith, but failed to fully comply with the requirement of the rule or practice of the agency.

“(B) REMAND.—If it cannot be determined whether the agency would have granted equitable relief because the appellant acted in good faith, but failed to comply with the rule or practice of the agency, the matter shall be remanded to the agency for further consideration.

“(4) DETERMINATION OF APPEALABILITY.—If an officer, employee, or committee of an agency determines that a decision is not appealable and a participant appeals the decision to the Director, the Director shall determine whether the decision is adverse to the individual participant and appealable or is a matter of general applicability and not subject to appeal.

“(5) APPEALABILITY OF DETERMINATION.—The determination of the Director as to whether a decision is appealable is final.”.

(c) Equitable relief.—Section 278 of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6998) is amended by striking subsection (d).

(d) Conforming amendment.—Section 296(b) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 7014(b)) is amended—

(1) in paragraph (6)(C), by striking “or” at the end;

(2) in paragraph (7), by striking the period at the end and inserting “; or”; and

(3) by adding at the end the following:

“(8) the authority of the Secretary to carry out amendments to sections 272 and 278 made by the Agriculture Reform, Food, and Jobs Act of 2012”..”.

SEC. 1610. Technical corrections.

(a) Section 359f(c)(1)(B) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359ff(c)(1)(B)) is amended by adding a period at the end.

(b)(1) Section 1603(g) of the Food, Conservation, and Energy Act of 2008 (Public Law 110–246; 122 Stat. 1739) is amended in paragraphs (2) through (6) and the amendments made by those paragraphs by striking “1703(a)” each place it appears and inserting “1603(a)”.

(2) This subsection and the amendments made by this subsection take effect as if included in the Food, Conservation, and Energy Act of 2008 (Public Law 110–246; 122 Stat. 1651).

SEC. 1611. Assignment of payments.

(a) In general.—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 this title.

(b) Notice.—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. 1612. Tracking of benefits.

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

SEC. 1613. Signature authority.

(a) In general.—In carrying out this title and title II and amendments made by those titles, if the Secretary approves a document, the Secretary shall not subsequently determine the document is inadequate or invalid because of the lack of authority of any person signing the document on behalf of the applicant or any other individual, entity, general partnership, or joint venture, or the documents relied upon were determined inadequate or invalid, unless the person signing the program document knowingly and willfully falsified the evidence of signature authority or a signature.

(b) Affirmation.—

(1) IN GENERAL.—Nothing in this section prohibits the Secretary from asking a proper party to affirm any document that otherwise would be considered approved under subsection (a).

(2) NO RETROACTIVE EFFECT.—A denial of benefits based on a lack of affirmation under paragraph (1) shall not be retroactive with respect to third-party producers who were not the subject of the erroneous representation of authority, if the third-party producers—

(A) relied on the prior approval by the Secretary of the documents in good faith; and

(B) substantively complied with all program requirements.

SEC. 1614. Implementation.

(a) Streamlining.—In implementing this title, the Secretary shall, to the maximum extent practicable—

(1) seek to reduce administrative burdens and costs to producers by streamlining and reducing paperwork, forms, and other administrative requirements;

(2) improve coordination, information sharing, and administrative work with the Risk Management Agency and the Natural Resources Conservation Service; and

(3) take advantage of new technologies to enhance efficiency and effectiveness of program delivery to producers.

(b) Implementation.—On October 1, 2013, the Secretary shall make available to the Farm Service Agency to carry out this title $100,000,000.

SEC. 2001. Extension and enrollment requirements of conservation reserve program.

(a) Extension.—Section 1231(a) of the Food Security Act of 1985 (16 U.S.C. 3831(a)) is amended by striking “2012” and inserting “2017”.

(b) Eligible land.—Section 1231(b) of the Food Security Act of 1985 (16 U.S.C. 3831(b)) is amended—

(1) in paragraph (1)(B), by striking “the date of enactment of the Food, Conservation, and Energy Act of 2008” and inserting “the date of enactment of the Agriculture Reform, Food, and Jobs Act of 2012”;

(2) by striking paragraph (2) and redesignating paragraph (3) as paragraph (2);

(3) by inserting before paragraph (4) the following:

“(3) grassland that—

“(A) contains forbs or shrubland (including improved rangeland and pastureland) for which grazing is the predominant use;

“(B) is located in an area historically dominated by grassland; and

“(C) could provide habitat for animal and plant populations of significant ecological value if the land is retained in its current use or restored to a natural condition;”;

(4) in paragraph (4)(C), by striking “filterstrips devoted to trees or shrubs” and inserting “filterstrips and riparian buffers devoted to trees, shrubs, or grasses”; and

(5) by striking paragraph (5) and inserting the following:

“(5) the portion of land in a field not enrolled in the conservation reserve in a case in which—

“(A) more than 50 percent of the land in the field is enrolled as a buffer or filterstrip or more than 75 percent of the land in the field is enrolled in a practice other than as a buffer or filterstrip; 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.—Section 1231(c) of the Food Security Act of 1985 (16 U.S.C. 3831(c)) is amended by striking “if” and all that follows through the period at the end and inserting “if, during the crop year, the land was devoted to a conserving use.”.

(d) Enrollment.—Section 1231 of the Food Security Act of 1985 (16 U.S.C. 3831) is amended by striking subsection (d) and inserting the following:

“(d) Enrollment.—

“(1) MAXIMUM ACREAGE ENROLLED.—The Secretary may maintain in the conservation reserve at any 1 time during—

“(A) fiscal year 2012, no more than 32,000,000 acres;

“(B) fiscal year 2013, no more than 30,000,000 acres;

“(C) fiscal year 2014, no more than 27,500,000 acres;

“(D) fiscal year 2015, no more than 26,500,000 acres;

“(E) fiscal year 2016, no more than 25,500,000 acres; and

“(F) fiscal year 2017, no more than 25,000,000 acres.

“(2) GRASSLAND.—

“(A) LIMITATION.—For purposes of applying the limitations in paragraph (1), no more than 1,500,000 acres of the land described in subsection (b)(3) may be enrolled in the program at any 1 time during the 2013 through 2017 fiscal years.

“(B) PRIORITY.—In enrolling acres under subparagraph (A), the Secretary may give priority to land with expiring conservation reserve program contracts.

“(C) METHOD OF ENROLLMENT.—In enrolling acres under subparagraph (A), the Secretary shall make the program available to owners or operators of eligible land at least once during each fiscal year.”.

(e) Duration of contract.—Section 1231(e) of the Food Security Act of 1985 (16 U.S.C. 3831(e)) is amended by striking paragraphs (2) and (3) and inserting the following:

“(2) SPECIAL RULE FOR CERTAIN LAND.—In the case of land devoted to hardwood trees, shelterbelts, windbreaks, or wildlife corridors under a contract entered into under this subchapter, the owner or operator of the land may, within the limitations prescribed under this section, specify the duration of the contract.”.

(f) Conservation priority areas.—Section 1231(f) of the Food Security Act of 1985 (16 U.S.C. 3831(f)) is amended—

(1) in paragraph (1), by striking “watershed areas of the Chesapeake Bay Region, the Great Lakes Region, the Long Island Sound Region, and other”;

(2) in paragraph (2), by striking “watersheds.—Watersheds” and inserting “areas.—Areas”; and

(3) in paragraph (3), by striking “a watershed’s designation—” and all that follows through the period at the end and inserting “an area’s designation if the Secretary finds that the area no longer contains actual and significant adverse water quality or habitat impacts related to agricultural production activities.”.

SEC. 2002. Farmable wetland program.

(a) Extension.—Section 1231B(a)(1) of the Food Security Act of 1985 (16 U.S.C. 3831b(a)(1)) is amended—

(1) by striking “2012” and inserting “2017”; and

(2) by striking “a program” and inserting “a farmable wetland program”.

(b) Eligible acreage.—Section 1231B(b)(1)(B) of the Food Security Act of 1985 (16 U.S.C. 3831b(b)(1)(B)) is amended by striking “flow from a row crop agriculture drainage system” and inserting “surface and subsurface flow from row crop agricultural production”.

(c) Clerical amendments.—Section 1231B of the Food Security Act of 1985 (16 U.S.C. 3831b) is amended—

(1) by striking the heading and inserting the following:

“SEC. 1231B. Farmable wetland program”;

and

(2) in subsection (f)(2), by striking “section 1234(c)(2)(B)” and inserting “section 1234(c)(2)(A)(ii)”.

SEC. 2003. Duties of owners and operators.

(a) Limitation on harvesting, grazing or commercial use of forage.—Section 1232(a)(8) of the Food Security Act of 1985 (16 U.S.C. 3832(a)(8)) is amended by striking “except that” and all that follows through the semicolon at the end of the paragraph and inserting “except as provided in section 1233(b);”.

(b) Conservation plan requirements.—Section 1232 of the Food Security Act of 1985 (16 U.S.C. 3832) is amended by striking subsection (b) and inserting the following:

“(b) Conservation plans.—The plan referred to in subsection (a)(1) shall set forth—

“(1) the conservation measures and practices to be carried out by the owner or operator during the term of the contract; and

“(2) the commercial use, if any, to be permitted on the land during the term.”.

(c) Rental payment reduction.—Section 1232 of the Food Security Act of 1985 (16 U.S.C. 3832) is amended by striking subsection (d).

SEC. 2004. Duties of the Secretary.

Section 1233 of the Food Security Act of 1985 (16 U.S.C. 3833) is amended to read as follows:

“SEC. 1233. Duties of the Secretary.

“(a) Cost-share and rental payments.—In return for a contract entered into by an owner or operator, 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 or other eligible land normally devoted to the production of an agricultural commodity on a farm or ranch to a less intensive use;

“(B) the retirement of any cropland base and allotment history that the owner or operator agrees to retire permanently; and

“(C) the development and management of grassland for multiple natural resource conservation benefits, including soil, water, air, and wildlife.

“(b) Specified activities permitted.—The Secretary shall permit certain activities or commercial uses of land that is subject to the contract if those activities or uses are consistent with a plan approved by the Secretary and include—

“(1) harvesting, grazing, or other commercial use of the forage in response to drought, flooding, or other emergency without any reduction in the rental rate;

“(2) grazing by livestock of a beginning farmer or rancher without any reduction in the rental rate, if the grazing is—

“(A) consistent with the conservation of soil, water quality, and wildlife habitat (including habitat during the primary nesting season for critical birds in the area); and

“(B) described in subparagraph (B) or (C) of paragraph (3);

“(3) consistent with the conservation of soil, water quality, and wildlife habitat (including habitat during the primary nesting season for critical birds in the area) and in exchange for a reduction of not less than 25 percent in the annual rental rate for the acres covered by the authorized activity—

“(A) managed harvesting and other commercial use (including the managed harvesting of biomass), except that in permitting those activities the Secretary, in coordination with the State technical committee—

“(i) shall develop appropriate vegetation management requirements; and

“(ii) shall identify periods during which the activities may be conducted, such that the frequency is at least once every 5 years but not more than once every 3 years;

“(B) prescribed grazing for the control of invasive species, which may be conducted annually;

“(C) routine grazing, except that in permitting routine grazing, the Secretary, in coordination with the State technical committee—

“(i) shall develop appropriate vegetation management requirements and stocking rates for the land that are suitable for continued routine grazing; and

“(ii) shall identify the periods during which routine grazing may be conducted, such that the frequency is not more than once every 2 years, taking into consideration regional differences such as—

“(I) climate, soil type, and natural resources;

“(II) the number of years that should be required between routine grazing activities; and

“(III) how often during a year in which routine grazing is permitted that routine grazing should be allowed to occur; and

“(D) the installation of wind turbines and associated access, 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 threatened or endangered wildlife and wildlife habitat; and

“(iii) the purposes of the conservation reserve program under this subchapter; and

“(4) the intermittent and seasonal use of vegetative buffer practices incidental to agricultural production on land adjacent to the buffer such that the permitted use does not destroy the permanent vegetative cover.

“(c) Authorized activities on grassland.—Notwithstanding section 1232(a)(8), for eligible land described in section 1231(b)(3), the Secretary shall permit the following activities:

“(1) 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 appropriate to that locality.

“(2) Haying, mowing, or harvesting for seed production, subject to appropriate restrictions during the primary nesting season for critical birds in the area.

“(3) Fire presuppression, rehabilitation, and construction of fire breaks.

“(4) Grazing-related activities, such as fencing and livestock watering.

“(d) Resource conserving use.—

“(1) IN GENERAL.—Beginning on the date that is 1 year before the date of termination of a contract under the program, the Secretary shall allow an owner or operator to make conservation and land improvements that facilitate maintaining protection of highly erodible land after expiration of the contract.

“(2) CONSERVATION PLAN.—The Secretary shall require an owner or operator carrying out the activities described in paragraph (1) to develop and implement a conservation plan.

“(3) REENROLLMENT PROHIBITED.—Land altered under paragraph (1) may not be reenrolled in the conservation reserve program for 5 years.

“(4) PAYMENT.—The Secretary shall provide an annual payment that is reduced in an amount commensurate with any income or other compensation received as a result of the activities carried out under paragraph (1).”.

SEC. 2005. Payments.

(a) Trees, windbreaks, shelterbelts, and wildlife corridors.—Section 1234(b)(3)(A) of the Food Security Act of 1985 (16 U.S.C. 3834(b)(3)(A)) is amended—

(1) in clause (i), by inserting “and” after the semicolon;

(2) by striking clause (ii); and

(3) by redesignating clause (iii) as clause (ii).

(b) Incentives.—Section 1234(b)(3)(B) of the Food Security Act of 1985 (16 U.S.C. 3834(b)(3)(B)) is amended—

(1) in clause (i), by inserting “, practices to improve the condition of resources on the land,” after “operator)”; and

(2) by adding at the end the following:

“(iii) INCENTIVES.—In making rental payments to an owner or operator of land described in subparagraph (A), the Secretary may provide incentive payments sufficient to encourage proper thinning and practices to improve the condition of resources on the land.”.

(c) Annual rental payments.—Section 1234(c) of the Food Security Act of 1985 (16 U.S.C. 3834(c)) is amended—

(1) in paragraph (1), by inserting “and other eligible land” after “highly erodible cropland” both places it appears;

(2) by striking paragraph (2) and inserting the following:

“(2) METHODS OF DETERMINATION.—

“(A) IN GENERAL.—The amounts payable to owners or operators in the form of rental payments under contracts entered into under this subchapter may be determined through—

“(i) the submission of bids for such contracts by owners and operators in such manner as the Secretary may prescribe; or

“(ii) such other means as the Secretary determines are appropriate.

“(B) GRASSLAND.—In the case of eligible land described in section 1231(b)(3), the Secretary shall make annual payments in an amount that is not more than 75 percent of the grazing value of the land covered by the contract.”; and

(3) in paragraph (5)(A)—

(A) by striking “The Secretary” and inserting the following:

“(i) SURVEY.—The Secretary”; and

(B) by adding at the end the following:

“(ii) USE.—The Secretary may use the survey of dryland cash rental rates described in clause (i) as a factor in determining rental rates under this section as the Secretary determines appropriate.”.

(d) Payment schedule.—Section 1234 of the Food Security Act of 1985 (16 U.S.C. 3834) is amended by striking subsection (d) and inserting the following:

“(d) Payment schedule.—

“(1) IN GENERAL.—Except as otherwise provided in this section, payments under this subchapter shall be made in cash in such amount and on such time schedule as is agreed on and specified in the contract.

“(2) SOURCE.—Payments under this subchapter shall be made using the funds of the Commodity Credit Corporation.

“(3) ADVANCE PAYMENT.—Payments under this subchapter may be made in advance of determination of performance.”.

(e) Payment limitation.—Section 1234(f) of the Food Security Act of 1985 (16 U.S.C. 3834(f)) is amended—

(1) in paragraph (1), by striking “, including rental payments made in the form of in-kind commodities,”;

(2) by striking paragraph (3); and

(3) by redesignating paragraph (4) as paragraph (2).

SEC. 2006. Contract requirements.

Section 1235(f) of the Food Security Act of 1985 (16 U.S.C. 3835(f)) is amended—

(1) in paragraph (1)—

(A) in the matter preceding subparagraph (A), by striking “Duties” and all that follows through “a beginning farmer” and inserting “Transition to covered farmer or rancher.—In the case of a contract modification approved in order to facilitate the transfer of land subject to a contract from a retired farmer or rancher to a beginning farmer”;

(B) in subparagraph (D), by striking “the farmer or rancher” and inserting “the covered farmer or rancher”; and

(C) in subparagraph (E), by striking “section 1001A(b)(3)(B)” and inserting “section 1001”; and

(2) in paragraph (2), by striking “requirement of section 1231(h)(4)(B)” and inserting “option provided under section 1234(c)(2)(A)(ii)”.

SEC. 2007. Conversion of land subject to contract to other conserving uses.

Section 1235A of the Food Security Act of 1985 (16 U.S.C. 3835a) is repealed.

SEC. 2008. Effective date.

(a) In general.—The amendments made by this title shall take effect on October 1, 2012, except, the amendment made by section 2001(d), which shall take effect on the date of enactment of this Act.

(b) Effect on existing contracts.—

(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this title shall not affect the validity or terms of any contract entered into by the Secretary of Agriculture 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.) before October 1, 2012, or any payments required to be made in connection with the contract.

(2) UPDATING OF EXISTING CONTRACTS.—The Secretary shall permit an owner or operator with a contract entered into 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.) before October 1, 2012, to update the contract to reflect the activities and uses of land under contract permitted under the terms and conditions of paragraphs (1) and (2) of section 1233(b) of that Act (as amended by section 2004).

SEC. 2101. Conservation stewardship program.

(a) Revision of current program.—Subchapter B of chapter 2 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3838d et seq.) is amended to read as follows:

“subchapter BConservation stewardship program

“SEC. 1238D. Definitions.

“In this subchapter:

“(1) AGRICULTURAL OPERATION.—The term ‘agricultural operation’ means all eligible land, whether or not contiguous, that is—

“(A) under the effective control of a producer at the time the producer enters into a contract under the program; and

“(B) operated with equipment, labor, management, and production or cultivation practices that are substantially separate from other agricultural operations, as determined by the Secretary.

“(2) CONSERVATION ACTIVITIES.—

“(A) IN GENERAL.—The term ‘conservation activities’ means conservation systems, practices, or management measures.

“(B) INCLUSIONS.—The term ‘conservation activities’ includes—

“(i) structural measures, vegetative measures, and land management measures, including agriculture drainage management systems, as determined by the Secretary; and

“(ii) planning needed to address a priority resource concern.

“(3) CONSERVATION STEWARDSHIP PLAN.—The term ‘conservation stewardship plan’ means a plan that—

“(A) identifies and inventories priority resource concerns;

“(B) establishes benchmark data and conservation objectives;

“(C) describes conservation activities to be implemented, managed, or improved; and

“(D) includes a schedule and evaluation plan for the planning, installation, and management of the new and existing conservation activities.

“(4) ELIGIBLE LAND.—

“(A) IN GENERAL.—The term ‘eligible land’ means—

“(i) private and tribal land on which agricultural commodities, livestock, or forest-related products are produced; and

“(ii) land associated with the land described in clause (i) on which priority resource concerns could be addressed through a contract under the program.

“(B) INCLUSIONS.—The term ‘eligible land’ includes—

“(i) cropland;

“(ii) grassland;

“(iii) rangeland;

“(iv) pastureland;

“(v) nonindustrial private forest land; and

“(vi) other agricultural land (including cropped woodland, marshes, and agricultural land used for the production of livestock), as determined by the Secretary.

“(5) PRIORITY RESOURCE CONCERN.—The term ‘priority resource concern’ means a natural resource concern or problem, as determined by the Secretary, that—

“(A) is identified at the national, State or local level, as a priority for a particular area of the State;

“(B) represents a significant concern in a State or region; and

“(C) is likely to be addressed successfully through the implementation of conservation activities under this program.

“(6) PROGRAM.—The term ‘program’ means the conservation stewardship program established by this subchapter.

“(7) STEWARDSHIP THRESHOLD.—The term ‘stewardship threshold’ means the level of management required, as determined by the Secretary, to conserve and improve the quality and condition of a natural resource.

“SEC. 1238E. Conservation stewardship program.

“(a) Establishment and purpose.—During each of fiscal years 2013 through 2017, the Secretary shall carry out a conservation stewardship program to encourage producers to address priority resource concerns and improve and conserve the quality and condition of natural resources in a comprehensive manner—

“(1) by undertaking additional conservation activities; and

“(2) by improving, maintaining, and managing existing conservation activities.

“(b) Exclusions.—

“(1) LAND ENROLLED IN OTHER CONSERVATION PROGRAMS.—Subject to paragraph (2), the following land (even if covered by the definition of eligible land) is not eligible for enrollment in the program:

“(A) Land enrolled in the conservation reserve program.

“(B) Land enrolled in the Agricultural Conservation Easement Program in a wetland easement.

“(C) Land enrolled in the conservation security program.

“(2) CONVERSION TO CROPLAND.—Eligible land used for crop production after October 1, 2012, that had not been planted, considered to be planted, or devoted to crop production for at least 4 of the 6 years preceding that date shall not be the basis for any payment under the program, unless the land does not meet the requirement because—

“(A) the land had previously been enrolled in the conservation reserve program;

“(B) the land has been maintained using long-term crop rotation practices, as determined by the Secretary; or

“(C) the land is incidental land needed for efficient operation of the farm or ranch, as determined by the Secretary.

“SEC. 1238F. Stewardship contracts.

“(a) Submission of contract offers.—To be eligible to participate in the conservation stewardship program, a producer shall submit a contract offer for the agricultural operation that—

“(1) demonstrates to the satisfaction of the Secretary that the producer, at the time of the contract offer, is meeting the stewardship threshold for at least 2 priority resource concerns; and

“(2) would, at a minimum, meet or exceed the stewardship threshold for at least 1 additional priority resource concern by the end of the stewardship contract by—

“(A) installing and adopting additional conservation activities; and

“(B) improving, maintaining, and managing existing conservation activities on the agricultural operation in a manner that increases or extends the conservation benefits in place at the time the contract offer is accepted by the Secretary.

“(b) Evaluation of contract offers.—

“(1) RANKING OF APPLICATIONS.—In evaluating contract offers the Secretary shall rank applications based on—

“(A) the level of conservation treatment on all applicable priority resource concerns at the time of application;

“(B) the degree to which the proposed conservation activities effectively increase conservation performance;

“(C) the number of applicable priority resource concerns proposed to be treated to meet or exceed the stewardship threshold by the end of the contract;

“(D) the extent to which other priority resource concerns will be addressed to meet or exceed the stewardship threshold by the end of the contract period;

“(E) the extent to which the actual and anticipated conservation benefits from the contract are provided at the least cost relative to other similarly beneficial contract offers; and

“(F) the extent to which priority resource concerns will be addressed when transitioning from the conservation reserve program to agricultural production.

“(2) PROHIBITION.—The Secretary may not assign a higher priority to any application because the applicant is willing to accept a lower payment than the applicant would otherwise be eligible to receive.

“(3) ADDITIONAL CRITERIA.—The Secretary may develop and use such additional criteria that the Secretary determines are necessary to ensure that national, State, and local priority resource concerns are effectively addressed.

“(c) Entering into contracts.—After a determination that a producer is eligible for the program under subsection (a), and a determination that the contract offer ranks sufficiently high under the evaluation criteria under subsection (b), the Secretary shall enter into a conservation stewardship contract with the producer to enroll the eligible land to be covered by the contract.

“(d) Contract provisions.—

“(1) TERM.—A conservation stewardship contract shall be for a term of 5 years.

“(2) REQUIRED PROVISIONS.—The conservation stewardship contract of a producer shall—

“(A) state the amount of the payment the Secretary agrees to make to the producer for each year of the conservation stewardship contract under section 1238G(d);

“(B) require the producer—

“(i) to implement a conservation stewardship plan that describes the program purposes to be achieved through 1 or more conservation activities;

“(ii) to maintain and supply information as required by the Secretary to determine compliance with the conservation stewardship plan and any other requirements of the program; and

“(iii) not to conduct any activities on the agricultural operation that would tend to defeat the purposes of the program;

“(C) permit all economic uses of the eligible land that—

“(i) maintain the agricultural nature of the land; and

“(ii) are consistent with the conservation purposes of the conservation stewardship contract;

“(D) include a provision to ensure that a producer shall not be considered in violation of the contract for failure to comply with the contract due to circumstances beyond the control of the producer, including a disaster or related condition, as determined by the Secretary;

“(E) include provisions where upon the violation of a term or condition of the contract at any time the producer has control of the land—

“(i) 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 all or a portion of the payments received by the producer under the contract, including any interest on the payments, as determined by the Secretary; or

“(ii) if the Secretary determines that the violation does not warrant termination of the contract, to refund or accept adjustments to the payments provided to the producer, as the Secretary determines to be appropriate;

“(F) include provisions in accordance with paragraphs (3) and (4) of this section; and

“(G) include any additional provisions the Secretary determines are necessary to carry out the program.

“(3) CHANGE OF INTEREST IN LAND SUBJECT TO A CONTRACT.—

“(A) IN GENERAL.—At the time of application, a producer shall have control of the eligible land to be enrolled in the program. Except as provided in subparagraph (B), a change in the interest of a producer in eligible land covered by a contract under the program shall result in the termination of the contract with regard to that land.

“(B) TRANSFER OF DUTIES AND RIGHTS.—Subparagraph (A) shall not apply if—

“(i) within a reasonable period of time (as determined by the Secretary) after the date of the change in the interest in all or a portion of the land covered by a contract under the program, the transferee of the land provides written notice to the Secretary that duties and rights under the contract have been transferred to, and assumed by, the transferee for the portion of the land transferred;

“(ii) the transferee meets the eligibility requirements of the program; and

“(iii) the Secretary approves the transfer of all duties and rights under the contract.

“(4) MODIFICATION AND TERMINATION OF CONTRACTS.—

“(A) VOLUNTARY MODIFICATION OR TERMINATION.—The Secretary may modify or terminate a contract with a producer if—

“(i) the producer agrees to the modification or termination; and

“(ii) the Secretary determines that the modification or termination is in the public interest.

“(B) INVOLUNTARY TERMINATION.—The Secretary may terminate a contract if the Secretary determines that the producer violated the contract.

“(5) REPAYMENT.—If a contract is terminated, the Secretary may, consistent with the purposes of the program—

“(A) allow the producer to retain payments already received under the contract; or

“(B) require repayment, in whole or in part, of payments received and assess liquidated damages.

“(e) Contract renewal.—At the end of the initial 5-year contract period, the Secretary may allow the producer to renew the contract for 1 additional 5-year period if the producer—

“(1) demonstrates compliance with the terms of the existing contract;

“(2) agrees to adopt and continue to integrate conservation activities across the entire agricultural operation as determined by the Secretary; and

“(3) agrees, at a minimum, to meet or exceed the stewardship threshold for at least 2 additional priority resource concerns on the agricultural operation by the end of the contract period.

“SEC. 1238G. Duties of the secretary.

“(a) In general.—To achieve the conservation goals of a contract under the conservation stewardship program, the Secretary shall—

“(1) make the program available to eligible producers on a continuous enrollment basis with 1 or more ranking periods, 1 of which shall occur in the first quarter of each fiscal year;

“(2) identify not less than 5 priority resource concerns in a particular watershed or other appropriate region or area within a State; and

“(3) establish a science-based stewardship threshold for each priority resource concern identified under subparagraph (2).

“(b) Allocation to states.—The Secretary shall allocate acres to States for enrollment, based—

“(1) primarily on each State’s proportion of eligible land to the total acreage of eligible land in all States; and

“(2) also on consideration of—

“(A) the extent and magnitude of the conservation needs associated with agricultural production in each State;

“(B) the degree to which implementation of the program in the State is, or will be, effective in helping producers address those needs; and

“(C) other considerations to achieve equitable geographic distribution of funds, as determined by the Secretary.

“(c) Acreage enrollment limitation.—During the period beginning on October 1, 2012, and ending on September 30, 2021, the Secretary shall, to the maximum extent practicable—

“(1) enroll in the program an additional 10,348,000 acres for each fiscal year; and

“(2) manage the program to achieve a national average rate of $18 per acre, which shall include the costs of all financial assistance, technical assistance, and any other expenses associated with enrollment or participation in the program.

“(d) Conservation stewardship payments.—

“(1) AVAILABILITY OF PAYMENTS.—The Secretary shall provide annual payments under the program to compensate the producer for—

“(A) installing and adopting additional conservation activities; and

“(B) improving, maintaining, and managing conservation activities in place at the operation of the producer at the time the contract offer is accepted by the Secretary.

“(2) PAYMENT AMOUNT.—The amount of the conservation stewardship annual payment shall be determined by the Secretary and based, to the maximum extent practicable, on the following factors:

“(A) Costs incurred by the producer associated with planning, design, materials, installation, labor, management, maintenance, or training.

“(B) Income forgone by the producer.

“(C) Expected conservation benefits.

“(D) The extent to which priority resource concerns will be addressed through the installation and adoption of conservation activities on the agricultural operation.

“(E) The level of stewardship in place at the time of application and maintained over the term of the contract.

“(F) The degree to which the conservation activities will be integrated across the entire agricultural operation for all applicable priority resource concerns over the term of the contract.

“(G) Such other factors as determined by the Secretary.

“(3) EXCLUSIONS.—A payment to a producer under this subsection shall not be provided for—

“(A) the design, construction, or maintenance of animal waste storage or treatment facilities or associated waste transport or transfer devices for animal feeding operations; or

“(B) conservation activities for which there is no cost incurred or income forgone to the producer.

“(4) DELIVERY OF PAYMENTS.—In making stewardship payments, the Secretary shall, to the extent practicable—

“(A) prorate conservation performance over the term of the contract so as to accommodate, to the extent practicable, producers earning equal annual stewardship payments in each fiscal year; and

“(B) make stewardship payments as soon as practicable after October 1 of each fiscal year for activities carried out in the previous fiscal year.

“(e) Supplemental payments for resource-conserving crop rotations.—

“(1) AVAILABILITY OF PAYMENTS.—The Secretary shall provide additional payments to producers that, in participating in the program, agree to adopt resource-conserving crop rotations to achieve beneficial crop rotations as appropriate for the eligible land of the producers.

“(2) BENEFICIAL CROP ROTATIONS.—The Secretary shall determine whether a resource-conserving crop rotation is a beneficial crop rotation eligible for additional payments under paragraph (1), based on whether the resource-conserving crop rotation is designed to provide natural resource conservation and production benefits.

“(3) ELIGIBILITY.—To be eligible to receive a payment described in paragraph (1), a producer shall agree to adopt and maintain the resource-conserving crop rotations for the term of the contract.

“(4) RESOURCE-CONSERVING CROP ROTATION.—In this subsection, 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.

“(f) Payment limitations.—A person or legal entity may not receive, directly or indirectly, payments under the program that, in the aggregate, exceed $200,000 under all contracts entered into during fiscal years 2013 through 2017, excluding funding arrangements with Indian tribes, regardless of the number of contracts entered into under the program by the person or legal entity.

“(g) Specialty crop and organic producers.—The Secretary shall ensure that outreach and technical assistance are available, and program specifications are appropriate to enable specialty crop and organic producers to participate in the program.

“(h) Coordination with organic certification.—The Secretary shall establish a transparent means by which producers may initiate organic certification under the Organic Foods Production Act of 1990 (7 U.S.C. 6501 et seq.) while participating in a contract under the program.

“(i) Regulations.—The Secretary shall promulgate regulations that—

“(1) prescribe such other rules as the Secretary determines to be necessary to ensure a fair and reasonable application of the limitations established under subsection (f); and

“(2) otherwise enable the Secretary to carry out the program.”.

(b) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

(c) Effect on existing contracts.—

(1) IN GENERAL.—The amendment made by this section shall not affect the validity or terms of any contract entered into by the Secretary of Agriculture under subchapter B of chapter 2 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3838d et seq.) before October 1, 2012, or any payments required to be made in connection with the contract.

(2) CONSERVATION STEWARDSHIP PROGRAM.—Funds made available under section 1241(a)(4) of the Food Security Act of 1985 (16 U.S.C. 3841(a)(4)) (as amended by section 2601(a)) may be used to administer and make payments to program participants enrolled into contracts during any of fiscal years 2009 through 2012.

SEC. 2201. Purposes.

Section 1240 of the Food Security Act of 1985 (16 U.S.C. 3839aa) is amended—

(1) in paragraph (3)—

(A) in subparagraph (A), by striking “and” at the end;

(B) by redesignating subparagraph (B) as subparagraph (C) and, in such subparagraph, by inserting “and” after the semicolon; and

(C) by inserting after subparagraph (A) the following:

“(B) develop and improve wildlife habitat; and”;

(2) in paragraph (4), by striking “; and” and inserting a period; and

(3) by striking paragraph (5).

SEC. 2202. Definitions.

Section 1240A of the Food Security Act of 1985 (16 U.S.C. 3839aa–1) is amended—

(1) by striking paragraph (2) and redesignating paragraphs (3) through (6) as paragraphs (2) through (5), respectively; and

(2) in paragraph (2) (as so redesignated), by inserting “established under the Organic Foods Production Act of 1990 (7 U.S.C. 6501 et seq.)” after “national organic program”.

SEC. 2203. Establishment and administration.

Section 1240B of the Food Security Act of 1985 (16 U.S.C. 3839aa–2) is amended—

(1) in subsection (a), by striking “2014” and inserting “2017”;

(2) in subsection (b), by striking paragraph (2) and inserting the following:

“(2) TERM.—A contract under the program shall have a term that does not exceed 10 years.”;

(3) in subsection (d)—

(A) in paragraph (3), by striking subparagraphs (A) through (G) and inserting the following:

“(A) soil health;

“(B) water quality and quantity improvement;

“(C) nutrient management;

“(D) pest management;

“(E) air quality improvement;

“(F) wildlife habitat development, including pollinator habitat;

“(G) invasive species management; or

“(H) other resource issues of regional or national significance, as determined by the Secretary.”; and

(B) in paragraph (4)—

(i) in subparagraph (A) in the matter preceding clause (i), by inserting “, veteran farmer or rancher (as defined in section 2501(e) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e))),” before “or a beginning farmer or rancher”; and

(ii) by striking subparagraph (B) and inserting the following:

“(B) ADVANCE PAYMENTS.—

“(i) IN GENERAL.—Not more than 30 percent of the amount determined under subparagraph (A) may be provided in advance for the purpose of purchasing materials or contracting.

“(ii) RETURN OF FUNDS.—If funds provided in advance are not expended during the 90-day period beginning on the date of receipt of the funds, the funds shall be returned within a reasonable time frame, as determined by the Secretary.”;

(4) by striking subsection (f) and inserting the following:

“(f) Allocation of funding.—

“(1) LIVESTOCK.—For each of fiscal years 2013 through 2017, at least 60 percent of the funds made available for payments under the program shall be targeted at practices relating to livestock production.

“(2) WILDLIFE HABITAT.—For each of fiscal years 2013 through 2017, at least 5 percent of the funds made available for payments under the program shall be targeted at practices benefitting wildlife habitat under subsection (g).”; and

(5) by striking subsection (g) and inserting the following:

“(g) Wildlife habitat incentive practice.—The Secretary shall provide payments under the program for conservation practices that support the restoration, development, and improvement of wildlife habitat on eligible land, including—

“(1) upland wildlife habitat;

“(2) wetland wildlife habitat;

“(3) habitat for threatened and endangered species;

“(4) fish habitat;

“(5) habitat on pivot corners and other irregular areas of a field; and

“(6) other types of wildlife habitat, as determined by the Secretary.”.

SEC. 2204. Evaluation of applications.

Section 1240C(b) of the Food Security Act of 1985 (16 U.S.C. 3839aa–3(b)) is amended—

(1) in paragraph (1), by striking “environmental” and inserting “conservation”; and

(2) in paragraph (3), by striking “purpose of the environmental quality incentives program specified in section 1240(1)” and inserting “purposes of the program”.

SEC. 2205. Duties of producers.

Section 1240D(2) of the Food Security Act of 1985 (16 U.S.C. 3839aa–4(2)) is amended by striking “farm, ranch, or forest” and inserting “enrolled”.

SEC. 2206. Limitation on payments.

Section 1240G of the Food Security Act of 1985 (16 U.S.C. 3839aa–7) is amended—

(1) in subsection (a)—

(A) by striking “by the person or entity during any six-year period,” and inserting “during fiscal years 2013 through 2017”; and

(B) by striking “federally recognized” and all that follows through the period and inserting “Indian tribes under section 1244(l).”; and

(2) in subsection (b)(2), by striking “any six-year period” and inserting “fiscal years 2013 through 2017”.

SEC. 2207. Conservation innovation grants and payments.

Section 1240H of the Food Security Act of 1985 (16 U.S.C. 3839aa–8) is amended—

(1) in subsection (b)(2), by striking “2012” and inserting “2017”; and

(2) by adding at the end the following:

“(c) Reporting.—Not later than December 31, 2013, and every 2 years thereafter, 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 on the status of projects funded under this section, including—

“(1) funding awarded;

“(2) project results; and

“(3) incorporation of project findings, such as new technology and innovative approaches, into the conservation efforts implemented by the Secretary.”.

SEC. 2208. Effective date.

(a) In general.—The amendments made by this title shall take effect on October 1, 2012.

(b) Effect on existing contracts.—The amendments made by this title shall not affect the validity or terms of any contract entered into by the Secretary of Agriculture under chapter 4 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3839aa et seq.) before October 1, 2012, or any payments required to be made in connection with the contract.

SEC. 2301. Agricultural Conservation Easement Program.

(a) Establishment.—Title XII of the Food Security Act of 1985 is amended by adding at the end the following:

“subtitle HAgricultural Conservation Easement Program

“SEC. 1265. Establishment and purposes.

“(a) Establishment.—The Secretary shall establish an Agricultural Conservation Easement Program for the conservation of eligible land and natural resources through easements or other interests in land.

“(b) Purposes.—The purposes of the program are to—

“(1) combine the purposes and coordinate the functions of the wetlands reserve program established under section 1237, the grassland reserve program established under section 1238N, and the farmland protection program established under section 1238I;

“(2) restore, protect, and enhance wetland on eligible land;

“(3) protect the agricultural use, viability, and related conservation values of eligible land by limiting nonagricultural uses of that land; and

“(4) protect grazing uses and related conservation values by restoring and conserving eligible land.

“SEC. 1265A. Definitions.

“In this subtitle:

“(1) AGRICULTURAL LAND EASEMENT.—The term ‘agricultural land easement’ means an easement or other interest in eligible land that—

“(A) is conveyed for the purposes of protecting natural resources and the agricultural nature of the land, and of promoting agricultural viability for future generations; and

“(B) permits the landowner the right to continue agricultural production and related uses subject to an agricultural land easement plan.

“(2) ELIGIBLE ENTITY.—The term ‘eligible entity’ means—

“(A) an agency of State or local government or an Indian tribe (including farmland protection board or land resource council established under State law); or

“(B) an organization that is—

“(i) 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) an organization described in section 501(c)(3) of that Code that is exempt from taxation under section 501(a) of that Code; or

“(iii) described in—

“(I) paragraph (1) or (2) of section 509(a) of that Code; or

“(II) section 509(a)(3) of that Code and is controlled by an organization described in section 509(a)(2) of that Code.

“(3) ELIGIBLE LAND.—The term ‘eligible land’ means private or tribal land that is—

“(A) in the case of an agricultural land easement, agricultural land, including land on a farm or ranch—

“(i) that is subject to a pending offer for purchase from an eligible entity;

“(ii) that—

“(I) has prime, unique, or other productive soil;

“(II) contains historical or archaeological resources; or

“(III) the protection of which will further a State or local policy consistent with the purposes of the program; and

“(iii) that is—

“(I) cropland;

“(II) rangeland;

“(III) grassland or land that contains forbs, or shrubland for which grazing is the predominant use;

“(IV) pastureland; or

“(V) nonindustrial private forest land that contributes to the economic viability of an offered parcel or serves as a buffer to protect such land from development;

“(B) in the case of a wetland easement, a wetland or related area, including—

“(i) farmed or converted wetland, together with the adjacent land that is functionally dependent on that land if the Secretary determines it—

“(I) is likely to be successfully restored in a cost effective manner; and

“(II) will maximize the wildlife benefits and wetland functions and values as determined by the Secretary in consultation with the Secretary of the Interior at the local level;

“(ii) cropland or grassland that was used for agricultural production prior to flooding from the natural overflow of a closed basin lake or pothole, as determined by the Secretary, together (where practicable) with the adjacent land that is functionally dependent on the cropland or grassland;

“(iii) farmed wetland and adjoining land that—

“(I) is enrolled in the conservation reserve program;

“(II) has the highest wetland functions and values; and

“(III) is likely to return to production after the land leaves the conservation reserve program;

“(iv) riparian areas that link wetland that is protected by easements or some other device that achieves the same purpose as an easement; or

“(v) other wetland of an owner that would not otherwise be eligible if the Secretary determines that the inclusion of such wetland in such easement would significantly add to the functional value of the easement; and

“(C) in the case of both an agricultural land easement or wetland easement, other land that is incidental to eligible land if the Secretary determines that it is necessary for the efficient administration of the easements under this program.

“(4) PROGRAM.—The term ‘program’ means the Agricultural Conservation Easement Program established by this subtitle.

“(5) WETLAND EASEMENT.—The term ‘wetland easement’ means a reserved interest in eligible land that—

“(A) is defined and delineated in a deed; and

“(B) stipulates—

“(i) the rights, title, and interests in land conveyed to the Secretary; and

“(ii) the rights, title, and interests in land that are reserved to the landowner.

“SEC. 1265B. Agricultural land easements.

“(a) Availability of assistance.—The Secretary shall facilitate and provide funding for—

“(1) the purchase by eligible entities of agricultural land easements and other interests in eligible land; and

“(2) technical assistance to provide for the conservation of natural resources pursuant to an agricultural land easement plan.

“(b) Cost-share assistance.—

“(1) IN GENERAL.—The Secretary shall provide cost-share assistance to eligible entities for purchasing agricultural land easements to protect the agricultural use, including grazing, and related conservation values of eligible land.

“(2) SCOPE OF ASSISTANCE AVAILABLE.—

“(A) FEDERAL SHARE.—Subject to subparagraph (C), an agreement described in paragraph (4) shall provide for a Federal share determined by the Secretary of an amount not to exceed 50 percent of the fair market value of the agricultural land easement or other interest in land, as determined by the Secretary using—

“(i) the Uniform Standards of Professional Appraisal Practices;

“(ii) an area-wide market analysis or survey; or

“(iii) another industry approved method.

“(B) NON-FEDERAL SHARE.—

“(i) IN GENERAL.—Subject to subparagraph (C), under the agreement, the eligible entity shall provide a share that is at least equivalent to that provided by the Secretary.

“(ii) SOURCE OF CONTRIBUTION.—An eligible entity may include as part of its share a charitable donation or qualified conservation contribution (as defined by section 170(h) of the Internal Revenue Code of 1986) from the private landowner if the eligible entity contributes its own cash resources in an amount that is at least 50 percent of the amount contributed by the Secretary.

“(C) WAIVER AUTHORITY.—In the case of grassland of special environmental significance, as determined by the Secretary, the Secretary may provide up to 75 percent of the fair market value of the agricultural land easement.

“(3) EVALUATION AND RANKING OF APPLICATIONS.—

“(A) CRITERIA.—The Secretary shall establish evaluation and ranking criteria to maximize the benefit of Federal investment under the program.

“(B) CONSIDERATIONS.—In establishing the criteria, the Secretary shall emphasize support for—

“(i) protecting agricultural uses and related conservation values of the land; and

“(ii) maximizing the protection of areas devoted to agricultural use.

“(C) BIDDING DOWN.—If the Secretary determines that 2 or more applications for cost-share assistance are comparable in achieving the purpose of the program, the Secretary shall not assign a higher priority to any of those applications solely on the basis of lesser cost to the program.

“(4) AGREEMENTS WITH ELIGIBLE ENTITIES.—

“(A) IN GENERAL.—The Secretary shall enter into agreements with eligible entities to stipulate the terms and conditions under which the eligible entity is permitted to use cost-share assistance provided under this section.

“(B) LENGTH OF AGREEMENTS.—An agreement shall be for a term that is—

“(i) in the case of an eligible entity certified under the process described in paragraph (5), a minimum of 5 years; and

“(ii) for all other eligible entities, at least 3, but not more than 5 years.

“(C) MINIMUM TERMS AND CONDITIONS.—An eligible entity shall be authorized to use its own terms and conditions for agricultural land easements so long as the Secretary determines such terms and conditions—

“(i) are consistent with the purposes of the program;

“(ii) are permanent or for the maximum duration allowed under applicable State law;

“(iii) permit effective enforcement of the conservation purposes of such easements, including appropriate restrictions depending on the purposes for which the easement is acquired;

“(iv) include a right of enforcement for the Secretary if terms of the easement are not enforced by the holder of the easement;

“(v) subject the land purchased to an agricultural land easement plan that—

“(I) describes the activities which promote the long-term viability of the land to meet the purposes for which the easement was acquired;

“(II) requires the management of grassland according to a grassland management plan; and

“(III) includes a conservation plan, where appropriate, and requires, at the option of the Secretary, the conversion of highly erodible cropland to less intensive uses; and

“(vi) include a limit on the impervious surfaces to be allowed that is consistent with the agricultural activities to be conducted.

“(D) SUBSTITUTION OF QUALIFIED PROJECTS.—An agreement shall allow, upon mutual agreement of the parties, substitution of qualified projects that are identified at the time of the proposed substitution.

“(E) EFFECT OF VIOLATION.—If a violation occurs of a term or condition of an agreement under this subsection—

“(i) the agreement may be terminated; and

“(ii) the Secretary may require the eligible entity to refund all or part of any payments received by the entity under the program, with interest on the payments as determined appropriate by the Secretary.

“(5) CERTIFICATION OF ELIGIBLE ENTITIES.—

“(A) CERTIFICATION PROCESS.—The Secretary shall establish a process under which the Secretary may—

“(i) directly certify eligible entities that meet established criteria;

“(ii) enter into long-term agreements with certified eligible entities; and

“(iii) accept proposals for cost-share assistance for the purchase of agricultural land easements throughout the duration of such agreements.

“(B) CERTIFICATION CRITERIA.—In order to be certified, an eligible entity shall demonstrate to the Secretary that the entity will maintain, at a minimum, for the duration of the agreement—

“(i) a plan for administering easements that is consistent with the purpose of this subtitle;

“(ii) the capacity and resources to monitor and enforce agricultural land easements; and

“(iii) policies and procedures to ensure—

“(I) the long-term integrity of agricultural land easements on eligible land;

“(II) timely completion of acquisitions of easements; and

“(III) timely and complete evaluation and reporting to the Secretary on the use of funds provided under the program.

“(C) REVIEW AND REVISION.—

“(i) REVIEW.—The Secretary shall conduct a review of eligible entities certified under subparagraph (A) every 3 years to ensure that such entities are meeting the criteria established under subparagraph (B).

“(ii) REVOCATION.—If the Secretary finds that the certified entity no longer meets the criteria established under subparagraph (B), the Secretary may—

“(I) allow the certified entity a specified period of time, at a minimum 180 days, in which to take such actions as may be necessary to meet the criteria; and

“(II) revoke the certification of the entity, if after the specified period of time, the certified entity does not meet such criteria.

“(c) Technical assistance.—The Secretary may provide technical assistance, if requested, to assist in—

“(1) compliance with the terms and conditions of easements; and

“(2) implementation of an agricultural land easement plan.

“SEC. 1265C. Wetland easements.

“(a) Availability of assistance.—The Secretary shall provide assistance to owners of eligible land to restore, protect, and enhance wetland through—

“(1) easements and related wetland easement plans; and

“(2) technical assistance.

“(b) Easements.—

“(1) METHOD OF ENROLLMENT.—The Secretary shall enroll eligible land through the use of—

“(A) 30-year easements;

“(B) permanent easements;

“(C) easements for the maximum duration allowed under applicable State laws; or

“(D) as an option for Indian tribes only, 30-year contracts.

“(2) LIMITATIONS.—

“(A) INELIGIBLE LAND.—The Secretary may not acquire easements on—

“(i) land established to trees under the conservation reserve program, except in cases where the Secretary determines it would further the purposes of the program; and

“(ii) farmed wetland or converted wetland where the conversion was not commenced prior to December 23, 1985.

“(B) CHANGES IN OWNERSHIP.—No easement shall be created on land that has changed ownership during the preceding 24-month period unless—

“(i) the new ownership was acquired by will or succession as a result of the death of the previous owner;

“(ii)(I) the ownership change occurred because of foreclosure on the land; and

“(II) immediately before the foreclosure, the owner of the land exercises a right of redemption from the mortgage holder in accordance with State law; or

“(iii) the Secretary determines that the land was acquired under circumstances that give adequate assurances that such land was not acquired for the purposes of placing it in the program.

“(3) EVALUATION AND RANKING OF OFFERS.—

“(A) CRITERIA.—The Secretary shall establish evaluation and ranking criteria to maximize the benefit of Federal investment under the program.

“(B) CONSIDERATIONS.—When evaluating offers from landowners, the Secretary may consider—

“(i) the conservation benefits of obtaining an easement or 30-year contract, including the potential environmental benefits if the land was removed from agricultural production;

“(ii) the cost-effectiveness of each easement or 30-year contract, so as to maximize the environmental benefits per dollar expended;

“(iii) whether the landowner or another person is offering to contribute financially to the cost of the easement or 30-year contract to leverage Federal funds; and

“(iv) such other factors as the Secretary determines are necessary to carry out the purposes of the program.

“(C) PRIORITY.—The Secretary shall place priority on acquiring easements based on the value of the easement for protecting and enhancing habitat for migratory birds and other wildlife.

“(4) AGREEMENT.—To be eligible to place eligible land into the program through a wetland easement, the owner of such land shall enter into an agreement with the Secretary to—

“(A) grant an easement on such land to the Secretary;

“(B) authorize the implementation of a wetland easement plan;

“(C) create and record an appropriate deed restriction in accordance with applicable State law to reflect the easement agreed to;

“(D) provide a written statement of consent to such easement signed by those holding a security interest in the land;

“(E) comply with the terms and conditions of the easement and any related agreements; and

“(F) permanently retire any existing cropland base and allotment history for the land on which the easement has been obtained.

“(5) TERMS AND CONDITIONS OF EASEMENT.—

“(A) IN GENERAL.—A wetland easement shall include terms and conditions that—

“(i) permit—

“(I) repairs, improvements, and inspections on the land that are necessary to maintain existing public drainage systems; and

“(II) owners to control public access on the easement areas while identifying access routes to be used for restoration activities and management and easement monitoring;

“(ii) prohibit—

“(I) the alteration of wildlife habitat and other natural features of such land, unless specifically authorized by the Secretary;

“(II) the spraying of such land with chemicals or the mowing of such land, except where such spraying or mowing is authorized by the Secretary or is necessary—

“(aa) to comply with Federal or State noxious weed control laws;

“(bb) to comply with a Federal or State emergency pest treatment program; or

“(cc) to meet habitat needs of specific wildlife species;

“(III) any activities to be carried out on the owner’s or successor’s land that is immediately adjacent to, and functionally related to, the land that is subject to the easement if such activities will alter, degrade, or otherwise diminish the functional value of the eligible land; and

“(IV) the adoption of any other practice that would tend to defeat the purposes of the program, as determined by the Secretary;

“(iii) provide for the efficient and effective establishment of wetland functions and values; and

“(iv) include such additional provisions as the Secretary determines are desirable to carry out the program or facilitate the practical administration thereof.

“(B) VIOLATION.—On the violation of the terms or conditions of the easement, the easement shall remain in force and the Secretary may require the owner to refund all or part of any payments received by the owner under the program, together with interest thereon as determined appropriate by the Secretary.

“(C) COMPATIBLE USES.—Land subject to a wetland easement may be used for compatible economic uses, including such activities as hunting and fishing, managed timber harvest, or periodic haying or grazing, if such use is specifically permitted by the wetland easement plan and is consistent with the long-term protection and enhancement of the wetland resources for which the easement was established.

“(D) RESERVATION OF GRAZING RIGHTS.—The Secretary may include in the terms and conditions of an easement a provision under which the owner reserves grazing rights if—

“(i) the Secretary determines that the reservation and use of the grazing rights—

“(I) is compatible with the land subject to the easement;

“(II) is consistent with the historical natural uses of the land and long-term protection and enhancement goals for which the easement was established; and

“(III) complies with the wetland easement plan; and

“(ii) the agreement provides for a commensurate reduction in the easement payment to account for the grazing value, as determined by the Secretary.

“(E) APPLICATION.—The relevant provisions of this paragraph shall also apply to a 30-year contract.

“(6) COMPENSATION.—

“(A) DETERMINATION.—

“(i) IN GENERAL.—The Secretary shall pay as compensation for a permanent easement acquired an amount necessary to encourage enrollment in the program based on the lowest of—

“(I) the fair market value of the land, as determined by the Secretary, using the Uniform Standards of Professional Appraisal Practices or an area-wide market analysis or survey;

“(II) the amount corresponding to a geographical cap, as determined by the Secretary in regulations; or

“(III) the offer made by the landowner.

“(ii) OTHER.—Compensation for a 30-year contract or 30-year easement shall be not less than 50 percent, but not more than 75 percent, of the compensation that would be paid for a permanent easement.

“(B) FORM OF PAYMENT.—Compensation shall be provided by the Secretary in the form of a cash payment, in an amount determined under subparagraph (A).

“(C) PAYMENT SCHEDULE.—

“(i) EASEMENTS VALUED AT LESS THAN $500,000.—For easements valued at $500,000 or less, the Secretary may provide easement payments in not more than 10 annual payments.

“(ii) EASEMENTS VALUED AT MORE THAN $500,000.—For easements valued at more than $500,000, the Secretary may provide easement payments in at least 5, but not more than 10 annual payments, except that, if the Secretary determines it would further the purposes of the program, the Secretary may make a lump sum payment for such an easement.

“(c) Easement restoration.—

“(1) IN GENERAL.—The Secretary shall provide financial assistance to carry out the establishment of conservation measures and practices and protect wetland functions and values, including necessary maintenance activities, as set forth in a wetland easement plan.

“(2) PAYMENTS.—The Secretary shall—

“(A) in the case of a permanent easement, pay an amount that is not less than 75 percent, but not more than 100 percent, of the eligible costs; and

“(B) in the case of a 30-year contract or 30-year easement, pay an amount that is not less than 50 percent, but not more than 75 percent, of the eligible costs.

“(d) Technical assistance.—

“(1) IN GENERAL.—The Secretary shall assist owners in complying with the terms and conditions of easements and 30-year contracts.

“(2) CONTRACTS OR AGREEMENTS.—The Secretary may enter into 1 or more contracts with private entities or agreements with a State, non-governmental organization, or Indian tribe to carry out necessary restoration, enhancement or maintenance of an easement if the Secretary determines that the contract or agreement will advance the purposes of the program.

“(e) Wetland enhancement option.—The Secretary may enter into 1 or more agreements with a State (including a political subdivision or agency of a State), nongovernmental organization, or Indian tribe to carry out a special wetland enhancement option that the Secretary determines would advance the purposes of the program.

“(f) Administration.—

“(1) WETLAND EASEMENT PLAN.—The Secretary shall develop a wetland easement plan for eligible land subject to a wetland easement, which will include the practices and activities necessary to restore, protect, enhance, and maintain the enrolled land.

“(2) DELEGATION OF EASEMENT ADMINISTRATION.—

“(A) IN GENERAL.—The Secretary may delegate any of the easement management, monitoring, and enforcement responsibilities of the Secretary to other Federal or State agencies that have the appropriate authority, expertise and resources necessary to carry out such delegated responsibilities or to other conservation organizations if the Secretary determines the organization has similar expertise and resources.

“(B) LIMITATION.—The Secretary shall not delegate any of the monitoring or enforcement responsibilities under the program to conservation organizations.

“(3) PAYMENTS.—

“(A) TIMING OF PAYMENTS.—The Secretary shall provide payment for obligations incurred by the Secretary under this section—

“(i) with respect to any easement restoration obligation as soon as possible after the obligation is incurred; and

“(ii) with respect to any annual easement payment obligation incurred by the Secretary as soon as possible after October 1 of each calendar year.

“(B) PAYMENTS TO OTHERS.—If an owner who is entitled to a payment dies, becomes incompetent, is otherwise unable to receive such payment, or is succeeded by another person or entity who renders or completes the required performance, the Secretary shall make such 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.

“SEC. 1265D. Administration.

“(a) Ineligible land.—The Secretary may not acquire an easement under the program on—

“(1) land owned by an agency of the United States, other than land held in trust for Indian tribes;

“(2) land owned in fee title by a State, including an agency or a subdivision of a State, or a unit of local government;

“(3) land subject to an easement or deed restriction which, as determined by the Secretary, provides similar protection as would be provided by enrollment in the program; and

“(4) land where the purposes of the program would be undermined due to on-site or off-site conditions, such as risk of hazardous substances, proposed or existing rights of way, infrastructure development, or adjacent land uses.

“(b) Priority.—In evaluating applications under the program, the Secretary may give priority to land that is currently enrolled in the conservation reserve program in a contract that is set to expire within 1 year and—

“(1) in the case of an agricultural land easement, is grassland that would benefit from protection under a long-term easement; and

“(2) in the case of a wetland easement, is a wetland or related area with the highest functions and values and is likely to return to production after the land leaves the conservation reserve program.

“(c) Subordination, exchange, modification, and termination.—

“(1) IN GENERAL.—The Secretary may subordinate, exchange, terminate, or modify any interest in land, or portion of such interest, administered by the Secretary, either directly or on behalf of the Commodity Credit Corporation under the program when the Secretary determines that—

“(A) it is in the Federal Government’s interest to subordinate, exchange, modify or terminate the interest in land;

“(B) the subordination, exchange, modification, or termination action—

“(i) will address a compelling public need for which there is no practicable alternative, or

“(ii) such action will further the practical administration of the program; and

“(C) the subordination, exchange, modification, or termination action will result in comparable conservation value and equivalent or greater economic value to the United States.

“(2) CONSULTATION.—The Secretary shall work with the current owner, and eligible entity if applicable, to address any subordination, exchange, termination, or modification of the interest, or portion of such interest in land.

“(3) NOTICE.—At least 90 days before taking any termination action described in paragraph (1), the Secretary shall provide written notice of such action to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate.

“(d) Land enrolled in other programs.—

“(1) CONSERVATION RESERVE PROGRAM.—The Secretary may terminate or modify an existing contract entered into under section 1231(a) if eligible land that is subject to such contract is transferred into the program.

“(2) OTHER.—Land enrolled in the wetlands reserve program, grassland reserve program, or farmland protection program shall be considered enrolled in this program.

“(e) Allocation of funds for agricultural land easements.—Of the funds made available under section 1241 to carry out the program for a fiscal year, the Secretary shall, to the extent practicable, use no less than 40 percent for agricultural land easements.”.

(b) Compliance with certain requirements.—Before an eligible entity or owner of eligible land may receive assistance under subtitle H of title XII of the Food Security Act of 1985, the eligible entity or person shall agree, during the crop year for which the assistance is provided and in exchange for the assistance—

(1) to comply with applicable conservation requirements under subtitle B of title XII of that Act (16 U.S.C. 3811 et seq.); and

(2) to comply with applicable wetland protection requirements under subtitle C of title XII of that Act (16 U.S.C. 3821 et seq.).

(c) Cross reference.—Section 1244 of the Food Security Act of 1985 (16 U.S.C. 3844) is amended—

(1) in subsection (c)—

(A) in paragraph (1)—

(i) by inserting “and” at the end of subparagraph (A);

(ii) by striking “and” at the end of subparagraph (B); and

(iii) by striking subparagraph (C);

(B) by redesignating paragraph (2) as paragraph (3); and

(C) by inserting after paragraph (1) the following:

“(2) the Agricultural Conservation Easement Program established under subtitle H; and”; and

(2) in subsection (f)—

(A) in paragraph (1)—

(i) in subparagraph (A), by striking “programs administered under subchapters B and C of chapter 1 of subtitle D” and inserting “conservation reserve program established under subchapter B of chapter 1 of subtitle D and the Agricultural Conservation Easement Program under subtitle H using wetland easements under section 1265C”; and

(ii) in subparagraph (B), by striking “subchapter C of chapter 1 of subtitle D” and inserting “the Agricultural Conservation Easement Program under subtitle H using wetland easements under section 1265C”; and

(B) in paragraph (4), by striking “subchapter C” and inserting “subchapter B”.

(d) Effective date.—The amendments made by this section shall take effect on October 1, 2012.

SEC. 2401. Regional Conservation Partnership Program.

(a) In general.—Title XII of the Food Security Act of 1985 is amended by inserting after subtitle H (as added by section 2301) the following:

“subtitle IRegional Conservation Partnership Program

“SEC. 1271. Establishment and purposes.

“(a) Establishment.—The Secretary shall establish a Regional Conservation Partnership Program to implement eligible activities through—

“(1) partnership agreements with eligible partners; and

“(2) contracts with producers.

“(b) Purposes.—The purposes of the program are—

“(1) to combine the purposes and coordinate the functions of—

“(A) the agricultural water enhancement program established under section 1240I;

“(B) the Chesapeake Bay watershed program established under section 1240Q;

“(C) the cooperative conservation partnership initiative established under section 1243; and

“(D) the Great Lakes basin program for soil erosion and sediment control established under section 1240P;.

“(2) to further the conservation, restoration, and sustainable use of soil, water, wildlife, and related natural resources on a regional or watershed scale; and

“(3) to encourage partners to cooperate with producers in—

“(A) meeting or avoiding the need for national, State, and local natural resource regulatory requirements related to production; and

“(B) implementing projects that will result in the installation and maintenance of eligible activities that affect multiple agricultural or nonindustrial private forest operations on a local, regional, State, or multi-State basis.

“SEC. 1271A. Definitions.

“In this subtitle:

“(1) COVERED PROGRAMS.—The term ‘covered programs’ means—

“(A) the agricultural conservation easement program;

“(B) the environmental quality incentives program; and

“(C) the conservation stewardship program.

“(2) ELIGIBLE ACTIVITY.—The term ‘eligible activity’ means any of the following conservation activities when delivered through a covered program:

“(A) Water quality restoration or enhancement projects, including nutrient management and sediment reduction.

“(B) Water quantity conservation, restoration, or enhancement projects relating to surface water and groundwater resources, including—

“(i) the conversion of irrigated cropland to the production of less water-intensive agricultural commodities or dryland farming; and

“(ii) irrigation system improvement and irrigation efficiency enhancement.

“(C) Drought mitigation.

“(D) Flood prevention.

“(E) Water retention.

“(F) Habitat conservation, restoration, and enhancement.

“(G) Erosion control.

“(H) Other related activities that the Secretary determines will help achieve conservation benefits.

“(3) ELIGIBLE PARTNER.—The term ‘eligible partner’ means any of the following:

“(A) An agricultural or silvicultural producer association or other group of producers.

“(B) A State or unit of local government.

“(C) An Indian tribe.

“(D) A farmer cooperative.

“(E) An institution of higher education.

“(F) An organization with an established history of working cooperatively with producers on agricultural land, as determined by the Secretary, to address—

“(i) local conservation priorities related to agricultural production, wildlife habitat development, and nonindustrial private forest land management; or

“(ii) critical watershed-scale soil erosion, water quality, sediment reduction, or other natural resource concerns.

“(4) PARTNERSHIP AGREEMENT.—The term ‘partnership agreement’ means an agreement between the Secretary and an eligible partner.

“(5) PROGRAM.—The term ‘program’ means the Regional Conservation Partnership Program established by this subtitle.

“SEC. 1271B. Regional conservation partnerships.

“(a) Partnership agreements authorized.—The Secretary may enter into a partnership agreement with an eligible partner to implement a project that will assist producers with installing and maintaining an eligible activity.

“(b) Length.—A partnership agreement shall be for a period not to exceed 5 years, except that the Secretary may extend the agreement 1 time for up to 12 months when an extension is necessary to meet the objectives of the program.

“(c) Duties of partners.—

“(1) IN GENERAL.—Under a partnership agreement, the eligible partner shall—

“(A) define the scope of a project, including—

“(i) the eligible activities to be implemented;

“(ii) the potential agricultural or nonindustrial private forest operations affected;

“(iii) the local, State, multi-State or other geographic area covered; and

“(iv) the planning, outreach, implementation and assessment to be conducted;

“(B) conduct outreach and education to producers for potential participation in the project;

“(C) at the request of a producer, act on behalf of a producer participating in the project in applying for assistance under section 1271C;

“(D) leverage financial or technical assistance provided by the Secretary with additional funds to help achieve the project objectives;

“(E) conduct an assessment of the project’s effects; and

“(F) at the conclusion of the project, report to the Secretary on its results and funds leveraged.

“(2) CONTRIBUTION.—A partner shall provide a significant portion of the overall costs of the scope of the project as determined by the Secretary.

“(d) Applications.—

“(1) COMPETITIVE PROCESS.—The Secretary shall conduct a competitive process to select applications for partnership agreements and may assess and rank applications with similar conservation purposes as a group.

“(2) CRITERIA USED.—In carrying out the process described in paragraph (1), the Secretary shall make public the criteria used in evaluating applications.

“(3) CONTENT.—An application to the Secretary shall include a description of—

“(A) the scope of the project as described in subsection (c)(1)(A);

“(B) the plan for monitoring, evaluating, and reporting on progress made towards achieving the project’s objectives;

“(C) the program resources requested for the project, including the covered programs to be used and estimated funding needed from the Secretary;

“(D) the partners collaborating to achieve project objectives, including their roles, responsibilities, capabilities, and financial contribution; and

“(E) any other elements the Secretary considers necessary to adequately evaluate and competitively select applications for funding under the program.

“(4) APPLICATION SELECTION.—

“(A) PRIORITY TO CERTAIN APPLICATIONS.—The Secretary shall give a higher priority to applications that—

“(i) assist producers in meeting or avoiding the need for a natural resource regulatory requirement;

“(ii) significantly leverage non-Federal financial and technical resources and coordinate with other local, State, regional, or national efforts;

“(iii) deliver high percentages of applied conservation to address conservation priorities or local, State, regional, or national conservation initiatives; or

“(iv) provide innovation in conservation methods and delivery, including outcome-based performance measures and methods.

“(B) OTHER APPLICATIONS.—The Secretary may give priority to applications that—

“(i) have a high percentage of producers in the area to be covered by the agreement; or

“(ii) meet other factors that are important for achieving the purposes of the program, as determined by the Secretary.

“SEC. 1271C. Assistance to producers.

“(a) In general.—The Secretary shall enter into contracts to provide financial and technical assistance to—

“(1) producers participating in a project with an eligible partner as described in section 1271B; or

“(2) producers that fit within the scope of a project described in section 1271B or a critical conservation area designated pursuant to section 1271F, but who are seeking to implement an eligible activity independent of a partner.

“(b) Terms and conditions.—

“(1) CONSISTENCY WITH PROGRAM RULES.—

“(A) IN GENERAL.—Except as provided in subparagraph (B), the Secretary shall ensure that the terms and conditions of a contract under this section are consistent with the applicable rules of the covered programs to be used as part of the project, as described in the application under section 1271B(d)(3)(C).

“(B) ADJUSTMENTS.—Except for statutory program requirements governing appeals, payment limitations, and conservation compliance, the Secretary may adjust the discretionary program rules of a covered program—

“(i) to provide a simplified application and evaluation process; and

“(ii) to better reflect unique local circumstances and purposes if the Secretary determines such adjustments are necessary to achieve the purposes of the program.

“(2) ALTERNATIVE FUNDING ARRANGEMENTS.—

“(A) IN GENERAL.—For the purposes of providing assistance for land described in subsection (a) and section 1271F, the Secretary may enter into alternative funding arrangements with a multistate water resource agency or authority if—

“(i) the Secretary determines that the goals and objectives of the program will be met by the alternative funding arrangements;

“(ii) the agency or authority certifies that the limitations established under this section on agreements with individual producers will not be exceeded; and

“(iii) all participating producers meet applicable payment eligibility provisions.

“(B) CONDITIONS.—As a condition on receipt of funding under subparagraph (A), the multistate water resource agency or authority shall agree—

“(i) to submit an annual independent audit to the Secretary that describes the use of funds under this paragraph;

“(ii) to provide any data necessary for the Secretary to issue a report on the use of funds under this paragraph; and

“(iii) not to use any funds for administration or contracting with another entity.

“(C) LIMITATION.—The Secretary may enter into not more than 10 alternative funding arrangements under this paragraph.

“(c) Payments.—

“(1) IN GENERAL.—In accordance with statutory requirements of the covered programs involved, the Secretary may make payments to a producer in an amount determined by the Secretary to be necessary to achieve the purposes of the program.

“(2) PAYMENTS TO CERTAIN PRODUCERS.—The Secretary may provide payments for a period of 5 years—

“(A) to producers participating in a project that addresses water quantity concerns and in an amount sufficient to encourage conversion from irrigated to dryland farming; and

“(B) to producers participating in a project that addresses water quality concerns and in an amount sufficient to encourage adoption of conservation practices and systems that improve nutrient management.

“(3) WAIVER AUTHORITY.—To assist in the implementation of the program, the Secretary may waive the applicability of the limitation in section 1001D(b)(2) of this Act for participating producers if the Secretary determines that the waiver is necessary to fulfill the objectives of the program.

“SEC. 1271D. Funding.

“(a) Availability of funds.—The Secretary shall use $100,000,000 of the funds of the Commodity Credit Corporation for each of fiscal years 2013 through 2017 to carry out the program established under this subtitle.

“(b) Duration of availability.—Funds made available under subsection (a) shall remain available until expended.

“(c) Additional funding and acres.—

“(1) IN GENERAL.—In addition to the funds made available under subsection (a), the Secretary shall reserve 8 percent of the funds and acres made available for a covered program for each of fiscal years 2013 through 2017 in order to ensure additional resources are available to carry out this program.

“(2) UNUSED FUNDS AND ACRES.—Any funds or acres reserved under paragraph (1) for a fiscal year from a covered program that are not obligated under this program by April 1 of that fiscal year shall be returned for use under the covered program.

“(d) Allocation of funding.—Of the funds and acres made available for the program under subsections (a) and (c), the Secretary shall allocate—

“(1) 25 percent of the funds and acres to projects based on a State competitive process administered by the State conservationist, with the advice of the State technical committee;

“(2) 40 percent of the funds and acres to projects based on a national competitive process to be established by the Secretary; and

“(3) 35 percent of the funds and acres to projects for the critical conservation areas designated in section 1271F.

“(e) Limitation on administrative expenses.—None of the funds made available under the program may be used to pay for the administrative expenses of partners.

“SEC. 1271E. Administration.

“(a) Disclosure.—In addition to the criteria used in evaluating applications as described in section 1271B(d)(2), the Secretary shall make publicly available information on projects selected through the competitive process described in section 1271B(d)(1).

“(b) Reporting.—Not later than December 31, 2013, and for every 2 years thereafter, 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 status of projects funded under the program, including—

“(1) the number and types of partners and producers participating in the partnership agreements selected;

“(2) the number of producers receiving assistance;

“(3) total funding committed to projects, including Federal and non-Federal resources; and

“(4) a description of how the funds under section 1271C(b)(3) are being administered, including—

“(A) any oversight mechanisms that the Secretary has implemented;

“(B) the process through which the Secretary is resolving appeals by program participants; and

“(C) the means by which the Secretary is tracking adherence to any applicable provisions for payment eligibility.

“SEC. 1271F. Critical conservation areas.

“(a) In general.—When administering the funding described in section 1271D(d)(3), the Secretary shall select applications for partnership agreements and producer contracts within designated critical conservation areas.

“(b) Critical conservation area designations.—

“(1) IN GENERAL.—The Secretary shall designate up to 6 geographical areas as critical conservation areas based on the degree to which an area—

“(A) includes multiple States with significant agricultural production;

“(B) is covered by an existing regional, State, binational, or multistate agreement or plan that has established objectives, goals and work plans and is adopted by a Federal, State, or regional authority;

“(C) has water quality concerns, including concerns for reducing erosion, promoting sediment control, and addressing nutrient management activities affecting large bodies of water of regional, national, or international significance;

“(D) has water quantity concerns, including—

“(i) concerns for groundwater, surface water, aquifer, or other water sources; or

“(ii) a need to promote water retention and flood prevention; or

“(E) is subject to regulatory requirements that could reduce the economic scope of agricultural operations within the area.

“(2) EXPIRATION.—Critical conservation area designations under this section shall expire after 5 years, subject to redesignation, except that the Secretary may withdraw designation from an area if the Secretary finds the area no longer meets the conditions described in paragraph (1).

“(c) Administration.—

“(1) IN GENERAL.—Except as provided in paragraph (2), the Secretary shall administer any partnership agreement or producer contract under this section in a manner that is consistent with the terms of the program.

“(2) RELATIONSHIP TO EXISTING ACTIVITY.—The Secretary shall, to the maximum extent practicable, ensure that eligible activities carried out in critical conservation areas designated under this section complement and are consistent with other Federal and State programs and water quality and quantity strategies.”.

(b) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2501. Conservation of private grazing land.

Section 1240M(e) of the Food Security Act of 1985 (16 U.S.C. 3839bb(e)) is amended inserting “and $30,000,000 for each of fiscal years 2013 through 2017” before the period at the end.

SEC. 2502. Grassroots source water protection program.

Section 1240O(b) of the Food Security Act of 1985 (16 U.S.C. 3839bb–2(b)) is amended by inserting “and $15,000,000 for each of fiscal years 2013 through 2017” before the period at the end.

SEC. 2503. Voluntary public access and habitat incentive program.

(a) Funding.—Section 1240R(f) of the Food Security Act of 1985 (16 U.S.C. 3839bb–5(f)) is amended by inserting “and $40,000,000 for the period of fiscal years 2013 through 2017” before the period at the end .

(b) Report on program effectiveness.—Not later than 2 years 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 evaluating the effectiveness of the voluntary public access and habitat incentive program established by section 1240R of the Food Security Act of 1985 (16 U.S.C. 3839bb–5), including—

(1) identifying cooperating agencies;

(2) identifying the number of land holdings and total acres enrolled by State;

(3) evaluating the extent of improved access on eligible land, improved wildlife habitat, and related economic benefits; and

(4) any other relevant information and data relating to the program that would be helpful to such Committees.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2504. Agriculture conservation experienced services program.

(a) Funding.—Section 1252 of the Food Security Act of 1985 (16 U.S.C. 3851) is amended by striking subsection (c) and inserting the following:

“(c) Funding.—

“(1) IN GENERAL.—The Secretary may carry out the ACES program using funds made available to carry out each program under this title.

“(2) EXCLUSION.—Funds made available to carry out the conservation reserve program may not be used to carry out the ACES program.”.

(b) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2505. Small watershed rehabilitation program.

Section 14(h)(2)(E) of the Watershed Protection and Flood Prevention Act (16 U.S.C. 1012(h)(2)(E)) is amended by striking “2012” and inserting “2017”.

SEC. 2506. Terminal lakes assistance.

Section 2507 of the Food, Security, and Rural Investment Act of 2002 (43 U.S.C. 2211 note; Public Law 107–171) is amended to read as follows:

“SEC. 2507. Terminal lakes assistance.

“(a) Definitions.—In this section:

“(1) ELIGIBLE LAND.—The term ‘eligible land’ means privately owned agricultural land (including land in which a State has a property interest as a result of state water law)—

“(A) that a landowner voluntarily agrees to sell to a State; and

“(B) which—

“(i)(I) is ineligible for enrollment as a wetland easement established under the Agricultural Conservation Easement Program under subtitle H of the Food Security Act of 1985;

“(II) is flooded to—

“(aa) an average depth of at least 6.5 feet; or

“(bb) a level below which the State determines the management of the water level is beyond the control of the State or landowner; or

“(III) is inaccessible for agricultural use due to the flooding of adjoining property (such as islands of agricultural land created by flooding);

“(ii) is located within a watershed with water rights available for lease or purchase; and

“(iii) has been used during at least 5 of the immediately preceding 30 years—

“(I) to produce crops or hay; or

“(II) as livestock pasture or grazing.

“(2) PROGRAM.—The term ‘program’ means the voluntary land purchase program established under this section.

“(3) TERMINAL LAKE.—The term ‘terminal lake’ means a lake and its associated riparian and watershed resources that is—

“(A) considered flooded because there is no natural outlet for water accumulating in the lake or the associated riparian area such that the watershed and surrounding land is consistently flooded; or

“(B) considered terminal because it has no natural outlet and is at risk due to a history of consistent Federal assistance to address critical resource conditions, including insufficient water available to meet the needs of the lake, general uses, and water rights.

“(b) Assistance.—The Secretary shall—

“(1) provide grants under subsection (c) for the purchase of eligible land impacted by a terminal lake described in subsection (a)(3)(A); and

“(2) provide funds to the Secretary of the Interior pursuant to subsection (e)(2) with assistance in accordance with subsection (d) for terminal lakes described in subsection (a)(3)(B).

“(c) Land purchase grants.—

“(1) IN GENERAL.—Using funds provided under subsection (e)(1), the Secretary shall make available land purchase grants to States for the purchase of eligible land in accordance with this subsection.

“(2) IMPLEMENTATION.—

“(A) AMOUNT.—A land purchase grant shall be in an amount not to exceed the lesser of—

“(i) 50 percent of the total purchase price per acre of the eligible land; or

“(ii)(I) in the case of eligible land that was used to produce crops or hay, $400 per acre; and

“(II) in the case of eligible land that was pasture or grazing land, $200 per acre.

“(B) DETERMINATION OF PURCHASE PRICE.—A State purchasing eligible land with a land purchase grant shall ensure, to the maximum extent practicable, that the purchase price of such land reflects the value, if any, of other encumbrances on the eligible land to be purchased, including easements and mineral rights.

“(C) COST-SHARE REQUIRED.—To be eligible to receive a land purchase grant, a State shall provide matching non-Federal funds in an amount equal to 50 percent of the amount described in subparagraph (A), including additional non-Federal funds.

“(D) CONDITIONS.—To receive a land purchase grant, a State shall agree—

“(i) to ensure that any eligible land purchased is—

“(I) conveyed in fee simple to the State; and

“(II) free from mortgages or other liens at the time title is transferred;

“(ii) to maintain ownership of the eligible land in perpetuity;

“(iii) to pay (from funds other than grant dollars awarded) any costs associated with the purchase of eligible land under this section, including surveys and legal fees; and

“(iv) to keep eligible land in a conserving use, as defined by the Secretary.

“(E) LOSS OF FEDERAL BENEFITS.—Eligible land purchased with a grant under this section shall lose eligibility for any benefits under other Federal programs, including—

“(i) benefits under title XII of the Food Security Act of 1985 (16 U.S.C. 3801 et seq.);

“(ii) benefits under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.); and

“(iii) covered benefits described in section 1001D(b) of the Food Security Act of 1985 (7 U.S.C. 1308–3a).

“(F) PROHIBITION.—Any Federal rights or benefits associated with eligible land prior to purchase by a State may not be transferred to any other land or person in anticipation of or as a result of such purchase.

“(d) Water assistance.—

“(1) IN GENERAL.—The Secretary of the Interior, acting through the Commissioner of Reclamation, may use the funds described in subsection (e)(2) to administer and provide financial assistance to carry out this subsection to provide water and assistance to a terminal lake described in subsection (a)(3)(B) through willing sellers or willing participants only—

“(A) to lease water;

“(B) to purchase land, water appurtenant to the land, and related interests; and

“(C) to carry out research, support and conservation activities for associated fish, wildlife, plant, and habitat resources.”

“(2) EXCLUSIONS.—The Secretary of the Interior may not use this subsection to deliver assistance to the Great Salt Lake in Utah, lakes that are considered dry lakes, or other lakes that do not meet the purposes of this section, as determined by the Secretary of the Interior.

“(3) TRANSITIONAL PROVISION.—

“(A) IN GENERAL.—Notwithstanding any other provision of this section, any funds made available before the date of enactment of the Agriculture Reform, Food, and Jobs Act of 2012 under a provision of law described in subparagraph (B) shall remain available using the provisions of law (including regulations) in effect on the day before the date of enactment of that Act.

“(B) DESCRIBED LAWS.—The provisions of law described in this section are—

“(i) section 2507 of the Farm Security and Rural Investment Act of 2002 (43 U.S.C. 2211 note; Public Law 107–171) (as in effect on the day before the date of enactment of the Agriculture Reform, Food, and Jobs Act of 2012);

“(ii) section 207 of the Energy and Water Development Appropriations Act, 2003 (Public Law 108–7; 117 Stat. 146);

“(iii) section 208 of the Energy and Water Development Appropriations Act, 2006 (Public Law 109–103; 119 Stat. 2268, 123 Stat. 2856); and

“(iv) section 208 of the Energy and Water Development and Related Agencies Appropriations Act, 2010 (Public Law 111–85; 123 Stat. 2858, 123 Stat. 2967, 125 Stat. 867).

“(e) Funding.—

“(1) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to the Secretary to carry out subsection (c) $25,000,000, to remain available until expended.

“(2) COMMODITY CREDIT CORPORATION.—As soon as practicable after the date of enactment of the Agriculture Reform, Food, and Jobs Act of 2012, the Secretary shall transfer to the Bureau of Reclamation Water and Related Resources Account $150,000,000 from the funds of the Commodity Credit Corporation to carry out subsection (d), to remain available until expended.”.

SEC. 2601. Funding.

(a) In general.—Section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) is amended by striking subsection (a) and inserting the following:

“(a) Annual funding.—For each of fiscal years 2013 through 2017, the Secretary shall use the funds, facilities, and authorities of the Commodity Credit Corporation to carry out the following programs under this title (including the provision of technical assistance):

“(1) The conservation reserve program under subchapter B of chapter 1 of subtitle D, including, to the maximum extent practicable—

“(A) $10,000,000 for the period of fiscal years 2013 through 2017 to provide payments under paragraph (3) of section 1234(b) in connection with thinning activities conducted on land described in subparagraph (B)(iii) of that paragraph; and

“(B) $50,000,000 for the period of fiscal years 2013 through 2017 to carry out section 1235(f) to facilitate the transfer of land subject to contracts from retired or retiring owners and operators to beginning farmers or ranchers and socially disadvantaged farmers or ranchers.

“(2) The Agricultural Conservation Easement Program under subtitle H using to the maximum extent practicable—

“(A) $223,000,000 for fiscal year 2013;

“(B) $702,000,000 for fiscal year 2014;

“(C) $500,000,000 for fiscal year 2015;

“(D) $525,000,000 for fiscal year 2016; and

“(E) $250,000,000 for fiscal year 2017.

“(3) The conservation security program under subchapter A of chapter 2 of subtitle D, using such sums as are necessary to administer contracts entered into before September 30, 2008.

“(4) The conservation stewardship program under subchapter B of chapter 2 of subtitle D.

“(5) The environmental quality incentives program under chapter 4 of subtitle D, using, to the maximum extent practicable—

“(A) $1,455,000,000 for fiscal year 2013;

“(B) $1,645,000,000 for fiscal year 2014; and

“(C) $1,650,000,000 for each of fiscal years 2015 through 2017.”.

(b) Guaranteed availability of funds.—Section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) is amended—

(1) by redesignating subsections (b) through (h) as subsections (c) through (i), respectively; and

(2) by inserting after subsection (a) the following:

“(b) Availability of funds.—Amounts made available by subsection (a) shall be used by the Secretary to carry out the programs specified in such subsection for fiscal years 2013 through 2017 and shall remain available until expended. Amounts made available for the programs specified in such subsection during a fiscal year through modifications, cancellations, terminations, and other related administrative actions and not obligated in that fiscal year shall remain available for obligation during subsequent fiscal years, but shall reduce the amount of additional funds made available in the subsequent fiscal year by an amount equal to the amount remaining unobligated.”.

(c) Effective date.—The amendments made by this section shall take effect on October 1, 2012.

SEC. 2602. Technical assistance.

Section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) is amended by striking subsection (c) (as redesignated by section 2601(b)(1)) and inserting the following:

“(c) Technical assistance.—

“(1) AVAILABILITY OF FUNDS.—Commodity Credit Corporation funds made available for a fiscal year for each of the programs specified in subsection (a)—

“(A) shall be available for the provision of technical assistance for the programs for which funds are made available as necessary to implement the programs effectively; and

“(B) shall not be available for the provision of technical assistance for conservation programs specified in subsection (a) other than the program for which the funds were made available.

“(2) REPORT.—Not later than December 31, 2012, the Secretary shall submit (and update as necessary in subsequent years) to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report—

“(A) detailing the amount of technical assistance funds requested and apportioned in each program specified in subsection (a) during the preceding fiscal year; and

“(B) any other data relating to this provision that would be helpful to such Committees.”.

SEC. 2603. Regional equity.

Section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) is amended by striking subsection (e) (as redesignated by section 2601(b)(1)) and inserting the following:

“(e) Regional equity.—

“(1) EQUITABLE DISTRIBUTION.—When determining funding allocations each fiscal year, the Secretary shall, after considering available funding and program demand in each State, provide a distribution of funds for conservation programs under subtitle D (excluding the conservation reserve program under subchapter B of chapter 1), subtitle H (excluding wetland easements under section 1265C), and subtitle I to ensure equitable program participation proportional to historical funding allocations and usage by all States.

“(2) MINIMUM PERCENTAGE.—In determining the specific funding allocations under paragraph (1), the Secretary shall—

“(A) ensure that during the first quarter of each fiscal year each State has the opportunity to establish that the State can use an aggregate allocation amount of at least 0.6 percent of the funds made available for those conservation programs; and

“(B) for each State that can so establish, provide an aggregate amount of at least 0.6 percent of the funds made available for those conservation programs.”.

SEC. 2604. Reservation of funds to provide assistance to certain farmers or ranchers for conservation access.

Subsection (h) of section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) (as redesignated by section 2601(b)(1)) is amended—

(1) in paragraph (1) by striking “2012” and inserting “2017”; and

(2) by adding at the end the following:

“(4) PREFERENCE.—In providing assistance under paragraph (1), the Secretary shall give preference to a veteran farmer or rancher (as defined in section 2501(e) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e))) that qualifies under subparagraph (A) or (B) of paragraph (1).”.

SEC. 2605. Annual report on program enrollments and assistance.

Subsection (i) of section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) (as redesignated by section 2601(b)(1)) is amended—

(1) in paragraph (1), by striking “wetlands reserve program” and inserting “agricultural conservation easement program”;

(2) by striking paragraphs (2) and (3) and redesignating paragraphs (4), (5), and (6) as paragraphs (2), (3), and (4), respectively;

(3) in paragraph (3) (as so redesignated)—

(A) by striking “agricultural water enhancement program” and inserting “regional conservation partnership program”; and

(B) by striking “section 1240I(g)” and inserting “section 1271C(c)(3)”; and

(4) by adding at the end the following:

“(5) Payments made under the conservation stewardship program.

“(6) Waivers granted by the Secretary under section 1265B(b)(2)(C).”.

SEC. 2606. Administrative requirements for conservation programs.

Section 1244 of the Food Security Act of 1985 (16 U.S.C. 3844) is amended—

(1) in subsection (a)(2), by adding at the end the following:

“(E) Veteran farmers or ranchers (as defined in section 2501(e) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e))).”;

(2) in subsection (d), by inserting “, H, and I” before the period at the end;

(3) in subsection (f)—

(A) in paragraph (1)(B), by striking “country” and inserting “county”; and

(B) in paragraph (3), by striking “subsection (c)(2)(B) or (f)(4)” and inserting “subsection (c)(2)(A)(ii) or (f)(2)”;

(4) by striking subsection (i) and inserting the following:

“(i) Conservation application process.—

“(1) INITIAL APPLICATION.—

“(A) IN GENERAL.—Not later than 1 year after the date of enactment of this subsection, the Secretary shall establish a single, simplified application for eligible entities to use in initially requesting assistance under any conservation program administered by the Secretary (referred to in this subsection as the ‘initial application’).

“(B) REQUIREMENTS.—To the maximum extent practicable, the Secretary shall ensure that—

“(i) a conservation program applicant is not required to provide information that is duplicative of information or resources already available to the Secretary for that applicant and the specific operation of the applicant; and

“(ii) the initial application process is streamlined to minimize complexity and redundancy.

“(2) REVIEW OF APPLICATION PROCESS.—

“(A) IN GENERAL.—Not later than 1 year after the date of enactment of this subsection, the Secretary shall review the application process for each conservation program administered by the Secretary, including the forms and processes used to receive assistance requests from eligible program participants.

“(B) REQUIREMENTS.—In carrying out the review, the Secretary shall determine what information the participant is required to submit during the application process, including—

“(i) identification information for the applicant;

“(ii) identification and location information for the land parcel or tract of concern;

“(iii) a general statement of the need or resource concern of the applicant for the land parcel or tract; and

“(iv) the minimum amount of other information the Secretary considers to be essential for the applicant to provide personally.

“(3) REVISION AND STREAMLINE.—

“(A) IN GENERAL.—Not later than 1 year after the date of enactment of this subsection, the Secretary shall carry out a revision of the application forms and processes for each conservation program administered by the Secretary to enable use of information technology to incorporate appropriate data and information concerning the conservation needs and solutions appropriate for the land area identified by the applicant.

“(B) GOAL.—The goal of the revision shall be to streamline the application process to minimize the burden placed on applicants.

“(4) CONSERVATION PROGRAM APPLICATION.—

“(A) IN GENERAL.—Once the needs of an applicant have been adequately assessed by the Secretary, or a third party provider under section 1242, based on the initial application, in order to determine the 1 or more programs under this title that best match the needs of the applicant, with the approval of the applicant, the Secretary may convert the initial application into the specific application for assistance for the relevant conservation program.

“(B) SECRETARIAL BURDEN.—To the maximum extent practicable, the Secretary shall—

“(i) complete the specific application for conservation program assistance for each applicant; and

“(ii) request only that specific further information from the applicant that is not already available to the Secretary.

“(5) IMPLEMENTATION AND NOTIFICATION.—Not later than 1 year after the date of enactment of this subsection, 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 written notification that the Secretary has fulfilled the requirements of this subsection.”; and

(5) by adding at the end the following:

“(j) Improved administrative efficiency and effectiveness.—In administrating a conservation program under this title, the Secretary shall, to the maximum extent practicable—

“(1) seek to reduce administrative burdens and costs to producers by streamlining conservation planning and program resources; and

“(2) take advantage of new technologies to enhance efficiency and effectiveness.

“(k) Relation to other payments.—Any payment received by an owner or operator under this title, including an easement payment or rental payment, shall be in addition to, and not affect, the total amount of payments that the owner or operator is otherwise eligible to receive under any of the following:

“(1) This Act.

“(2) The Agricultural Act of 1949 (7 U.S.C. 1421 et seq.).

“(3) The Agriculture Reform, Food, and Jobs Act of 2012.

“(4) Any law that succeeds a law specified in paragraph (1), (2), or (3).

“(l) Funding for Indian tribes.—In carrying out the conservation stewardship program under subchapter B of chapter 2 of subtitle D and the environmental quality incentives program under chapter 4 of subtitle D, the Secretary may enter into alternative funding arrangements with Indian tribes if the Secretary determines that the goals and objectives of the programs will be met by such arrangements, and that statutory limitations regarding contracts with individual producers will not be exceeded by any Tribal member.”.

SEC. 2607. Rulemaking authority.

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. 1246. Regulations.

“(a) In general.—The Secretary shall promulgate such regulations as are necessary to implement programs under this title, including such regulations as the Secretary determines to be necessary to ensure a fair and reasonable application of the limitations established under section 1244(f).

“(b) Rulemaking procedure.—The promulgation of regulations and administration of programs under this title—

“(1) shall be carried out without regard to—

“(A) the Statement of Policy of the Secretary effective July 24, 1971 (36 Fed. Reg. 13804), relating to notices of proposed rulemaking and public participation in rulemaking; and

“(B) chapter 35 of title 44, United States Code (commonly known as the Paperwork Reduction Act); and

“(2) shall be made as an interim rule effective on publication with an opportunity for notice and comment.

“(c) Congressional review of agency rulemaking.—In promulgating regulations under this section, the Secretary shall use the authority provided under section 808 of title 5, United States Code.”.

SEC. 2608. Standards for State technical committees.

Section 1261(b) of the Food Security Act of 1985 (16 U.S.C. 3861(b)) is amended by striking “Not later than 180 days after the date of enactment of the Food, Conservation, and Energy Act of 2008, the Secretary shall develop” and inserting “The Secretary shall review and update as necessary”.

SEC. 2609. Highly erodible land and wetland conservation for crop insurance.

(a) Highly erodible land program ineligibility.—

(1) IN GENERAL.—Section 1211(a)(1) of the Food Security Act of 1985 (16 U.S.C. 3811(a)(1)) 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) any portion of premium paid by the Federal Crop Insurance Corporation for a plan or policy of insurance under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.);”.

(2) EXEMPTIONS.—Section 1212(a)(2) of the Food Security Act of 1985 (16 U.S.C. 3812(a)(2)) is amended—

(A) in the first sentence, by striking “(2) If,” and inserting the following:

“(2) ELIGIBILITY BASED ON COMPLIANCE WITH CONSERVATION PLAN.—

“(A) IN GENERAL.—If,”;

(B) in the second sentence, by striking “In carrying” and inserting the following:

“(B) MINIMIZATION OF DOCUMENTATION.—In carrying”; and

(C) by adding at the end the following:

“(C) CROP INSURANCE.—In the case of payments that are subject to section 1211 for the first time due to the amendment made by section 2609(a) of the Agriculture Reform, Food, and Jobs Act of 2012, any person who produces an agricultural commodity on the land that is the basis of the payments shall have until January 1 of the fifth year after the date on which the payments became subject to section 1211 to develop and comply with an approved conservation plan.”.

(b) Wetland conservation program ineligibility.—Section 1221(b) of the Food Security Act of 1985 (16 U.S.C. 3821) is amended by adding at the end the following:

“(4) Any portion of premium paid by the Federal Crop Insurance Corporation for a plan or policy of insurance under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.).”.

SEC. 2701. Comprehensive conservation enhancement program.

Section 1230 of the Food Security Act of 1985 (16 U.S.C. 3830) is repealed.

SEC. 2702. Emergency forestry conservation reserve program.

(a) Repeal.—Section 1231A of the Food Security Act of 1985 (16 U.S.C. 3831a) is repealed.

(b) Transitional provisions.—

(1) EFFECT ON EXISTING CONTRACTS.—The amendment made by this section shall not affect the validity or terms of any contract entered into by the Secretary of Agriculture under section 1231A of the Food Security Act of 1985 (16 U.S.C. 3831a) before October 1, 2012, or any payments required to be made in connection with the contract.

(2) FUNDING.—The Secretary may use funds made available to carry out the conservation reserve program 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.) to continue to carry out contracts referred to in paragraph (1) using the provisions of law and regulation applicable to such contracts as in existence on September 30, 2012.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2703. Wetlands reserve program.

(a) Repeal.—Subchapter C of chapter 1 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3837 et seq.) is repealed.

(b) Transitional provisions.—

(1) EFFECT ON EXISTING CONTRACTS AND EASEMENTS.—The amendment made by this section shall not affect the validity or terms of any contract or easement entered into by the Secretary of Agriculture under subchapter C of chapter 1 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3837 et seq.) before October 1, 2012, or any payments required to be made in connection with the contract or easement.

(2) FUNDING.—

(A) USE OF PRIOR YEAR FUNDS.—Notwithstanding the repeal of subchapter C of chapter 1 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3837 et seq.), any funds made available from the Commodity Credit Corporation to carry out the wetlands reserve program under that subchapter for fiscal years 2009 through 2012 shall be made available to carry out contracts or easements referred to in paragraph (1) that were entered into prior to October 1, 2012 (including the provision of technical assistance), provided that no such contract or easement is modified so as to increase the amount of the payment received.

(B) OTHER.—The Secretary may use funds made available to carry out the agricultural conservation easement program under subtitle H of title XII of the Food Security Act of 1985, as added by section 2301 of this Act, to continue to carry out contracts and easements referred to in paragraph (1) using the provisions of law and regulation applicable to such contracts and easements as in existence on September 30, 2012.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2704. Farmland protection program and farm viability program.

(a) Repeal.—Subchapter C of chapter 2 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3838h et seq.) is repealed.

(b) Transitional provisions.—

(1) EFFECT ON EXISTING AGREEMENTS AND EASEMENTS.—The amendment made by this section shall not affect the validity or terms of any agreement or easement entered into by the Secretary of Agriculture under subchapter C of chapter 2 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3838h et seq.) before October 1, 2012, or any payments required to be made in connection with the agreement or easement.

(2) FUNDING.—

(A) USE OF PRIOR YEAR FUNDS.—Notwithstanding the repeal of subchapter C of chapter 2 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3838h et seq.), any funds made available from the Commodity Credit Corporation to carry out the farmland protection program under that subchapter for fiscal years 2009 through 2012 shall be made available to carry out agreements and easements referred to in paragraph (1) that were entered into prior to October 1, 2012 (including the provision of technical assistance).

(B) OTHER.—On exhaustion of funds made available under subparagraph (A), the Secretary may use funds made available to carry out the agricultural conservation easement program under subtitle H of title XII of the Food Security Act of 1985, as added by section 2301 of this Act, to continue to carry out agreements and easements referred to in paragraph (1) using the provisions of law and regulation applicable to such agreements and easement as in existence on September 30, 2012.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2705. Grassland reserve program.

(a) Repeal.—Subchapter D of chapter 2 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3838n et seq.) is repealed.

(b) Transitional provisions.—

(1) EFFECT ON EXISTING CONTRACTS, AGREEMENTS, AND EASEMENTS.—The amendment made by this section shall not affect the validity or terms of any contract, agreement, or easement entered into by the Secretary of Agriculture under subchapter D of chapter 2 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3838n et seq.) before October 1, 2012, or any payments required to be made in connection with the contract, agreement, or easement.

(2) FUNDING.—

(A) USE OF PRIOR YEAR FUNDS.—Notwithstanding the repeal of subchapter D of chapter 2 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3838n et seq.), any funds made available from the Commodity Credit Corporation to carry out the grassland reserve program under that subchapter for fiscal years 2009 through 2012 shall be made available to carry out contracts, agreements, or easements referred to in paragraph (1) that were entered into prior to October 1, 2012 (including the provision of technical assistance), provided that no such contract, agreement, or easement is modified so as to increase the amount of the payment received.

(B) OTHER.—The Secretary may use funds made available to carry out the agricultural conservation easement program under subtitle H of title XII of the Food Security Act of 1985, as added by section 2301 of this Act, to continue to carry out contracts, agreements, and easements referred to in paragraph (1) using the provisions of law and regulation applicable to such contracts, agreements, and easements as in existence on September 30, 2012.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2706. Agricultural water enhancement program.

(a) Repeal.—Section 1240I of the Food Security Act of 1985 (16 U.S.C. 3839aa–9) is repealed.

(b) Transitional provisions.—

(1) EFFECT ON EXISTING CONTRACTS AND AGREEMENTS.—The amendment made by this section shall not affect the validity or terms of any contract or agreement entered into by the Secretary of Agriculture under section 1240I of the Food Security Act of 1985 (16 U.S.C. 3839aa–9) before October 1, 2012, or any payments required to be made in connection with the contract or agreement.

(2) FUNDING.—

(A) USE OF PRIOR YEAR FUNDS.—Notwithstanding the repeal of section 1240I of the Food Security Act of 1985 (16 U.S.C. 3839aa–9), any funds made available from the Commodity Credit Corporation to carry out the agricultural water enhancement program under that section for fiscal years 2009 through 2012 shall be made available to carry out contracts and agreements referred to in paragraph (1) that were entered into prior to October 1, 2012 (including the provision of technical assistance).

(B) OTHER.—On exhaustion of funds made available under subparagraph (A), the Secretary may use funds made available to carry out the regional conservation partnerships program under subtitle I of title XII of the Food Security Act of 1985, as added by section 2401 of this Act, to continue to carry out contracts and agreements referred to in paragraph (1) using the provisions of law and regulation applicable to such contracts and agreements as in existence on September 30, 2012.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2707. Wildlife habitat incentive program.

(a) Repeal.—Section 1240N of the Food Security Act of 1985 (16 U.S.C. 3839bb–1) is repealed.

(b) Transitional provisions.—

(1) EFFECT ON EXISTING CONTRACTS.—The amendment made by this section shall not affect the validity or terms of any contract entered into by the Secretary of Agriculture under section 1240N of the Food Security Act of 1985 (16 U.S.C. 3839bb–1) before October 1, 2012, or any payments required to be made in connection with the contract.

(2) FUNDING.—

(A) USE OF PRIOR YEAR FUNDS.—Notwithstanding the repeal of section 1240N of the Food Security Act of 1985 (16 U.S.C. 3839bb–1), any funds made available from the Commodity Credit Corporation to carry out the wildlife habitat incentive program under that section for fiscal years 2009 through 2012 shall be made available to carry out contracts referred to in paragraph (1) which were entered into prior to October 1, 2012 (including the provision of technical assistance).

(B) OTHER.—On exhaustion of funds made available under subparagraph (A), the Secretary may use funds made available to carry out the environmental quality incentives program under chapter 4 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3839aa et seq.) to continue to carry out contracts referred to in paragraph (1) using the provisions of law and regulation applicable to such contracts as in existence on September 30, 2012.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2708. Great Lakes basin program.

(a) Repeal.—Section 1240P of the Food Security Act of 1985 (16 U.S.C. 3839bb–3) is repealed.

(b) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2709. Chesapeake Bay watershed program.

(a) Repeal.—Section 1240Q of the Food Security Act of 1985 (16 U.S.C. 3839bb–4) is repealed.

(b) Transitional provisions.—

(1) EFFECT ON EXISTING CONTRACTS, AGREEMENTS, AND EASEMENTS.—The amendment made by this section shall not affect the validity or terms of any contract, agreement, or easement entered into by the Secretary of Agriculture under section 1240Q of the Food Security Act of 1985 (16 U.S.C. 3839bb–4) before October 1, 2012, or any payments required to be made in connection with the contract, agreement, or easement.

(2) FUNDING.—

(A) USE OF PRIOR YEAR FUNDS.—Notwithstanding the repeal of section 1240Q of the Food Security Act of 1985 (16 U.S.C. 3839bb–4), any funds made available from the Commodity Credit Corporation to carry out the Chesapeake Bay watershed program under that section for fiscal years 2009 through 2012 shall be made available to carry out contracts, agreements, and easements referred to in paragraph (1) that were entered into prior to October 1, 2012 (including the provision of technical assistance).

(B) OTHER.—The Secretary may use funds made available to carry out the regional conservation partnerships program under subtitle I of title XII of the Food Security Act of 1985, as added by section 2401 of this Act, to continue to carry out contracts, agreements, and easements referred to in paragraph (1) using the provisions of law and regulation applicable to such contracts, agreements, and easements as in existence on September 30, 2012.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2710. Cooperative conservation partnership initiative.

(a) Repeal.—Section 1243 of the Food Security Act of 1985 (16 U.S.C. 3843) is repealed.

(b) Transitional provisions.—

(1) EFFECT ON EXISTING CONTRACTS AND AGREEMENTS.—The amendment made by this section shall not affect the validity or terms of any contract or agreement entered into by the Secretary of Agriculture under section 1243 of the Food Security Act of 1985 (16 U.S.C. 3843) before October 1, 2012, or any payments required to be made in connection with the contract or agreement.

(2) FUNDING.—

(A) USE OF PRIOR YEAR FUNDS.—Notwithstanding the repeal of section 1243 of the Food Security Act of 1985 (16 U.S.C. 3843), any funds made available from the Commodity Credit Corporation to carry out the cooperative conservation partnership initiative under that section for fiscal years 2009 through 2012 shall be made available to carry out contracts and agreements referred to in paragraph (1) that were entered into prior to October 1, 2012 (including the provision of technical assistance).

(B) OTHER.—On exhaustion of funds made available under subparagraph (A), the Secretary may use funds made available to carry out the regional conservation partnerships program under subtitle I of title XII of the Food Security Act of 1985, as added by section 2401 of this Act, to continue to carry out contracts and agreements referred to in paragraph (1) using the provisions of law and regulation applicable to such contracts and agreements as in existence on September 30, 2012.

(c) Effective date.—The amendment made by this section shall take effect on October 1, 2012.

SEC. 2711. Environmental easement program.

Chapter 3 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3839 et seq.) is repealed.

SEC. 2712. Technical amendments.

(a) Section 1201(a) of the Food Security Act of 1985 (16 U.S.C. 3801(a)) is amended in the matter preceding paragraph (1) by striking “E” and inserting “I”.

(b) Section 1211(a) of the Food Security Act of 1985 (16 U.S.C. 3811(a)) is amended by striking “predominate” each place it appears and inserting “predominant”.

(c) Section 1242(i) of the Food Security Act of 1985(16 U.S.C. 3842(i)) is amended in the subsection heading by striking “speciality” and inserting “specialty”.

SEC. 3001. Set-aside for support for organizations through which nonemergency assistance is provided.

Effective October 1, 2012, section 202(e)(1) of the Food for Peace Act (7 U.S.C. 1722(e)(1)) is amended—

(1) in the matter preceding subparagraph (A), by striking “13 percent” and inserting “15 percent”; and

(2) in subparagraph (A), by striking “new” and inserting “and enhancing”.

SEC. 3002. Food aid quality.

Section 202(h) of the Food for Peace Act (7 U.S.C. 1722(h)) is amended—

(1) by striking paragraph (1) and inserting the following:

“(1) IN GENERAL.—The Administrator shall use funds made available for fiscal year 2013 and subsequent fiscal years to carry out this title—

“(A) to assess the types and quality of agricultural commodities and products donated for food aid;

“(B) to adjust products and formulations, including potential introduction of new fortificants and products, as necessary to cost-effectively meet nutrient needs of target populations;

“(C) to test prototypes;

“(D) to adopt new specifications or improve existing specifications for micronutrient fortified food aid products, based on the latest developments in food and nutrition science, and in coordination with other international partners;

“(E) to develop new program guidance to facilitate improved matching of products to purposes having nutritional intent, in coordination with other international partners;

“(F) to develop improved guidance for implementing partners on how to address nutritional deficiencies that emerge among recipients for whom food assistance is the sole source of diet in emergency programs that extend beyond 1 year, in coordination with other international partners; and

“(G) to evaluate, in appropriate settings and as necessary, the performance and cost-effectiveness of new or modified specialized food products and program approaches designed to meet the nutritional needs of the most vulnerable groups, such as pregnant and lactating mothers, and children under the age of 5.”; and

(2) in paragraph (3), by striking “2011” and inserting “2017”.

SEC. 3003. Minimum levels of assistance.

Section 204(a) of the Food for Peace Act (7 U.S.C. 1724(a)) is amended—

(1) in paragraph (1), by striking “2012” and inserting “2017”; and

(2) in paragraph (2), by striking “2012” and inserting “2017”.

SEC. 3004. Reauthorization of Food Aid Consultative Group.

Section 205(f) of the Food for Peace Act (7 U.S.C. 1725(f)) is amended by striking “2012” and inserting “2017”.

SEC. 3005. Oversight, monitoring, and evaluation of Food for Peace Act programs.

Section 207(f) of the Food for Peace Act (7 U.S.C. 1726a(f)) is amended—

(1) by striking paragraph (4) and redesignating paragraphs (5) and (6) as paragraphs (4) and (5), respectively; and

(2) in subparagraph (A) of paragraph (5) (as so redesignated)—

(A) by striking “2012” and inserting “2017”; and

(B) by striking “during fiscal year 2009” and inserting “during the period of fiscal years 2013 through 2017”.

SEC. 3006. Assistance for stockpiling and rapid transportation, delivery, and distribution of shelf-stable prepackaged foods.

Section 208(f) of the Food for Peace Act (7 U.S.C. 1726b(f)) is amended by striking “2012” and inserting “2017”.

SEC. 3007. Limitation on total volume of commodities monetized.

Section 403 of the Food for Peace Act (7 U.S.C. 1733) is amended by adding at the end the following:

“(m) Limitation on monetization of commodities.—

“(1) LIMITATION.—

“(A) IN GENERAL.—Unless the Administrator grants a waiver under paragraph (2), no commodity may be made available under this Act unless the rate of return for the commodity (as determined under subparagraph (B)) is at least 70 percent.

“(B) RATE OF RETURN.—For purposes of subparagraph (A), the rate of return shall be equal to the proportion that—

“(i) the proceeds the implementing partners generate through monetization; bears to

“(ii) the cost to the Federal Government to procure and ship the commodities to a recipient country for monetization.

“(2) WAIVER AUTHORITY.—The Administrator may waive the application of the limitation in paragraph (1) with regard to a commodity for a recipient country if the Administrator determines that it is necessary to achieve the purposes of this Act in the recipient country.

“(3) REPORT.—Not later than 90 days after a waiver is granted under paragraph (2), the Administrator shall prepare, publish in the Federal Register, and submit to the Committees on Foreign Affairs, Agriculture, and Appropriations of the House of Representatives, and the Committees on Appropriations, Foreign Relations, and Agriculture, Nutrition, and Forestry of the Senate a report that—

“(A) contains the reasons for granting the waiver and the actual rate of return for the commodity; and

“(B) includes for the commodity the costs of bagging or further processing, ocean transportation, inland transportation in the recipient country, storage costs, and any other information that the Administrator determines to be necessary.”.

SEC. 3008. Flexibility.

Section 406 of the Food for Peace Act (7 U.S.C. 1736) is amended—

(1) by redesignating subsections (c) and (d) as subsections (d) and (e), respectively; and

(2) by inserting after subsection (b) the following:

“(c) Flexibility.—Notwithstanding any other provision of law and as necessary to achieve the purposes of this Act, funds available under this Act may be used to pay the costs of up to 20 percent of activities conducted in recipient countries by nonprofit voluntary organizations, cooperatives, or intergovernmental agencies or organizations.”.

SEC. 3009. Procurement, transportation, testing, and storage of agricultural commodities for prepositioning in the United States and foreign countries.

Section 407 of the Food for Peace Act (7 U.S.C. 1736a) is amended—

(1) in subparagraph (c)(4)(A)—

(A) by striking “2012” and inserting “2017”; and

(B) by striking “for each such fiscal year not more than $10,000,000 of such funds” and inserting “for each of fiscal years 2001 through 2012 not more than $10,000,000 of such funds and for each of fiscal years 2013 through 2017 not more than $15,000,000 of such funds”; and

(2) by adding at the end the following:

“(g) Funding for testing of food aid shipments.—Funds made available for agricultural products acquired under this Act and section 3107 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 1736o–1) may be used to pay for the testing of those agricultural products.”.

SEC. 3010. Deadline for agreements to finance sales or to provide other assistance.

Section 408 of the Food for Peace Act (7 U.S.C. 1736b) is amended by striking “2012” and inserting “2017”.

SEC. 3011. Minimum level of nonemergency food assistance.

Section 412 of the Food for Peace Act (7 U.S.C. 1736f) is amended by striking subsection (e) and inserting the following:

“(e) Minimum level of nonemergency food assistance.—

“(1) IN GENERAL.—Subject to paragraph (2), of the amounts made available to carry out emergency and nonemergency food assistance programs under title II, not less than 20 nor more than 30 percent for each of fiscal years 2013 through 2017 shall be expended for nonemergency food assistance programs under title II.

“(2) MINIMUM LEVEL.—The amount made available to carry out nonemergency food assistance programs under title II shall not be less than $275,000,000 for any fiscal year.”.

SEC. 3012. Coordination of foreign assistance programs report.

Section 413 of the Food for Peace Act (7 U.S.C. 1736(g)) is amended—

(1) by striking “(a) In general.—To the maximum” and inserting “To the maximum”; and

(2) by striking subsection (b).

SEC. 3013. Micronutrient fortification programs.

(a) Elimination of obsolete reference to study.—Section 415(a)(2)(B) of the Food for Peace Act (7 U.S.C. 1736g–2(a)(2)(B)) is amended by striking “, using recommendations” and all that follows through “quality enhancements”.

(b) Extension.—Section 415(c) of the Food for Peace Act (7 U.S.C. 1736g–2(c)) is amended by striking “2012” and inserting “2017”.

SEC. 3014. John Ogonowski and Doug Bereuter Farmer-to-Farmer Program.

Section 501 of the Food for Peace Act (7 U.S.C. 1737) is amended—

(1) in subsection (d)—

(A) by striking “0.5 percent” and inserting “0.6 percent”; and

(B) by striking “2012” and inserting “2017”; and

(2) in subsection (e)(1), by striking “2012” and inserting “2017”.

SEC. 3015. Prohibition on assistance for North Korea.

(a) In general.—No amounts may be obligated or expended to provide assistance under title II of the Food for Peace Act (7 U.S.C. 1721 et seq.) to the Democratic People’s Republic of Korea.

(b) National interest waiver.—The President may waive subsection (a) if the President determines and certifies to the Committees on Agriculture, Nutrition, and Forestry and Foreign Relations of the Senate and the Committees on Agriculture and Foreign Affairs of the House of Representatives that the waiver is in the national interest of the United States.

SEC. 3101. Export credit guarantee programs.

Section 211 of the Agricultural Trade Act of 1978 (7 U.S.C. 5641) is amended by striking subsection (b) and inserting the following:

“(b) Export credit guarantee programs.—The Commodity Credit Corporation shall make available for each of fiscal years 2013 through 2017 credit guarantees under section 202(a) in an amount equal to not more than $4,500,000,000 in credit guarantees.”.

SEC. 3102. Funding for market access program.

Section 211(c)(1)(A) of the Agricultural Trade Act of 1978 (7 U.S.C. 5641(c)(1)(A)) is amended by striking “2012” and inserting “2017”.

SEC. 3103. Foreign market development cooperator program.

Section 703(a) of the Agricultural Trade Act of 1978 (7 U.S.C. 5723(a)) is amended by striking “2012” and inserting “2017”.

SEC. 3201. Food for Progress Act of 1985.

(a) Extension.—The Food for Progress Act of 1985 (7 U.S.C. 1736o) is amended—

(1) in subsection (f)(3), by striking “2012” and inserting “2017”;

(2) in subsection (g), by striking “2012” and inserting “2017”;

(3) in subsection (k), by striking “2012” and inserting “2017”; and

(4) in subsection (l)(1), by striking “2012” and inserting “2017”.

(b) Repeal of completed project.—Subsection (f) of the Food for Progress Act of 1985 (7 U.S.C. 1736o) is amended by striking paragraph (6).

(c) Flexibility.—The Food for Progress Act of 1985 (7 U.S.C. 1736o) is amended in subsection (l) by adding at the end the following:

“(5) FLEXIBILITY.—Notwithstanding any other provision of law and as necessary to achieve the purposes of this Act, funds available under this Act may be used to pay the costs of up to 20 percent of activities conducted in recipient countries by nonprofit voluntary organizations, cooperatives, or intergovernmental agencies or organizations.”.

(d) Limitation on total volume of commodities monetized.—The Food for Progress Act of 1985 (7 U.S.C. 1736o) is amended by adding at the end the following:

“(p) Limitation on monetization of commodities.—

“(1) LIMITATION.—

“(A) IN GENERAL.—Unless the Secretary grants a waiver under paragraph (2), no eligible commodity may be made available under this section unless the rate of return for the eligible commodity (as determined under subparagraph (B)) is at least 70 percent.

“(B) RATE OF RETURN.—For purposes of subparagraph (A), the rate of return shall be equal to the proportion that—

“(i) the proceeds the implementing partners generate through monetization; bears to

“(ii) the cost to the Federal Government to procure and ship the eligible commodities to a recipient country for monetization.

“(2) WAIVER AUTHORITY.—The Secretary may waive the application of the limitation in paragraph (1) with regard to an eligible commodity for a recipient country if the Secretary determines that it is necessary to achieve the purposes of this Act in the recipient country.

“(3) REPORT.—Not later than 90 days after a waiver is granted under paragraph (2), the Secretary shall prepare, publish in the Federal Register, and submit to the Committees on Foreign Affairs, Agriculture, and Appropriations of the House of Representatives, and the Committees on Appropriations, Foreign Relations, and Agriculture, Nutrition, and Forestry of the Senate a report that—

“(A) contains the reasons for granting the waiver and the actual rate of return for the eligible commodity; and

“(B) includes for the commodity the costs of bagging or further processing, ocean transportation, inland transportation in the recipient country, storage costs, and any other information that the Secretary determines to be necessary.”.

SEC. 3202. Bill Emerson Humanitarian Trust.

Section 302 of the Bill Emerson Humanitarian Trust Act (7 U.S.C. 1736f–1) is amended—

(1) in subsection (b)(2)(B)(i), by striking “2012” both places it appears and inserting “2017”; and

(2) in subsection (h), by striking “2012” both places it appears and inserting “2017”.

SEC. 3203. Promotion of agricultural exports to emerging markets.

(a) Direct credits or export credit guarantees.—Section 1542(a) of the Food, Agriculture, Conservation, and Trade Act of 1990 (Public Law 101–624; 7 U.S.C. 5622 note) is amended by striking “2012” and inserting “2017”.

(b) Development of agricultural systems.—Section 1542(d)(1)(A)(i) of the Food, Agriculture, Conservation, and Trade Act of 1990 (Public Law 101–624; 7 U.S.C. 5622 note) is amended by striking “2012” and inserting “2017”.

SEC. 3204. McGovern-Dole International Food for Education and Child Nutrition Program.

(a) Reauthorization.—Section 3107(l)(2) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 1736o–1(l)(2)) is amended by striking “2012” and inserting “2017”.

(b) Technical correction.—Section 3107(d) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 1736o–1(d)) is amended by striking “to” in the matter preceding paragraph (1).

SEC. 3205. Technical assistance for specialty crops.

(a) Purpose.—Section 3205(b) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 5680(b)) is amended by striking “related barriers to trade” and inserting “technical barriers to trade”.

(b) Funding.—Section 3205(e)(2) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 5680(e)(2)) is amended—

(1) by inserting “and” at the end of subparagraph (C); and

(2) by striking subparagraphs (D) and (E) and inserting the following new subparagraph:

“(D) $9,000,000 for each of fiscal years 2011 through 2