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105th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 1st Session                                                     105-80
_______________________________________________________________________


 
       ONE-YEAR ENROLLMENT OF CONSERVATION RESERVE PROGRAM LANDS

                                _______
                                

 April 29, 1997.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

_______________________________________________________________________


 Mr. Smith of Oregon, from the Committee on Agriculture, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 1342]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Agriculture, to whom was referred the bill 
(H.R. 1342) to provide for a one-year enrollment in the 
conservation reserve of land covered by expiring conservation 
reserve program contracts, having considered the same, report 
favorably thereon with an amendment and recommend that the bill 
as amended do pass.
  The amendment is as follows:
  Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. ONE-YEAR ENROLLMENT OF LAND COVERED BY EXPIRING CONSERVATION 
                    RESERVE PROGRAM CONTRACTS.

  (a) Eligible Farm Lands.--This section applies with respect to a farm 
containing land covered by a conservation reserve program contract 
expiring during fiscal year 1997 if--
          (1) the farm had a crop acreage base for wheat, oats, or 
        barley at the time the conservation reserve program contract 
        was executed;
          (2) the farm is located in an area in which fall-seeded crops 
        are regularly planted, as determined by the Secretary of 
        Agriculture;
          (3) the owner of the farm (or the operator with the consent 
        of the owner) submitted, during the enrollment period that 
        ended on March 28, 1997, an eligible bid to enroll all or part 
        of the land covered by the expiring contract in the 
        conservation reserve 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.); and
          (4) the land designated in the bid satisfies the eligibility 
        criteria in effect for enrollment of land in the conservation 
        reserve.
  (b) One-Year Enrollment Authorized.--
          (1) Authority of owner or operator.--Except as provided in 
        subsection (g), the owner or operator of a farm described in 
        subsection (a) may enroll in the conservation reserve for a 
        one-year term to begin on October 1, 1997, the land covered by 
        the expiring conservation reserve program contract and included 
        in the owner's or operator's enrollment bid (as described in 
        subsection (a)(3)) if--
                  (A) the owner or operator notifies the Secretary in 
                writing, during the special notification period 
                required under paragraph (2), that the owner or 
                operator desires to enroll the land in the conservation 
                reserve for one year under this section; and
                  (B) the Secretary does not accept, before October 1, 
                1997, the owner's or operator's enrollment bid (as 
                described in subsection (a)(3)) to enroll the land in a 
                long-term conservation reserve program contract.
          (2) Special notification period.--Promptly upon the enactment 
        of this Act, the Secretary shall provide a special period for 
        owners and operators of farms described in subsection (a) to 
        permit the owners and operators to provide the notification 
        required under paragraph (1)(A) to enter into one-year 
        conservation reserve program contracts under this section.
  (c) Rental Rate.--The rental rate for a one-year conservation reserve 
program contract under subsection (b) shall be equal to the amount of 
the bid (as described in subsection (a)(3)) that the owner or operator 
submitted with respect to the land to be covered by the one-year 
contract.
  (d) Effect of One-Year Contract on Subsequent Enrollment.--If an 
owner or operator who enrolls eligible farm land in a one-year 
conservation reserve program contract under subsection (b) submits a 
bid to enroll the same land in the conservation reserve under a long-
term conservation reserve program contract that would commence on 
October 1, 1998, and the Secretary accepts the bid and enters into a 
long-term conservation reserve program contract with the owner or 
operator, then the one-year contract shall be considered to be the 
first year of that long-term conservation reserve program contract.
  (e) Maximum Enrollment.--The maximum number of acres in the 
conservation reserve during fiscal year 1998, including land enrolled 
by the Secretary under one-year conservation reserve program contracts 
under subsection (b), may not exceed 30,000,000 acres.
  (f) Application of Conservation Reserve Laws.--Except as specifically 
provided in this section, the terms and conditions of 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.) shall apply with respect to one-year 
conservation reserve program contracts authorized by this section.
  (g) Effect of Completion of 15th Enrollment.--If, as of the date of 
the enactment of this Act, the Secretary has already acted on the bids 
submitted during the enrollment period that ended on March 28, 1997, to 
enroll land in the conservation reserve, either by accepting or 
rejecting the bids, then the authority provided by this section for 
special one-year conservation reserve program contracts shall not take 
effect.

SEC. 2. SPECIAL EARLY TERMINATION AUTHORITY FOR CERTAIN CONSERVATION 
                    RESERVE PROGRAM CONTRACTS EXPIRING IN 1997.

  (a) Early Termination Authority.--A farm owner or operator described 
in subsection (b) who is a party to a conservation reserve program 
contract expiring during fiscal year 1997 may terminate the contract at 
any time after June 30, 1997. Notwithstanding section 1235(e) of the 
Food Security Act of 1985 (16 U.S.C. 3835(e)), the termination shall 
take effect immediately upon submission of notice of the termination to 
the Secretary of Agriculture and shall not result in a reduction in the 
amount of the rental payment due under the conservation reserve program 
contract for fiscal year 1997.
  (b) Eligible Owners and Operators.--A farm owner or operator referred 
to in subsection (a) is a farm owner or operator with respect to whom 
one of the following circumstances apply:
          (1) Neither the owner, operator, nor any other eligible 
        person submitted, during the enrollment period that ended on 
        March 28, 1997, an eligible bid to enroll all or part of the 
        land covered by the expiring conservation reserve program 
        contract in the conservation reserve established under 
        subchapter B of chapter 1 of subtitle D of title XII of the 
        Food Security Act of 1985 (16 U.S.C. 3831 et seq.).
          (2) An eligible bid was submitted during the enrollment 
        period to enroll all or part of the land covered by the 
        expiring contract in the conservation reserve, but the 
        Secretary of Agriculture rejected the bid and the owner or 
        operator did not notify the Secretary, in the manner provided 
        in section 1(b), that the owner or operator desired a one-year 
        contract under section 1.
  (c) Conservation Reserve Program Contract Defined.--In this section, 
the term ``conservation reserve program contract'' means 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.) for 
enrollment of farm acreage in the conservation reserve established 
under such subchapter.

                           BRIEF EXPLANATION

    H.R. 1342, as amended, allows farmers who plant fall-seeded 
crops and have Conservation Reserve Program (CRP) contracts 
expiring in 1997 to enroll the land subject to the expiring 
contract in a one-year CRP contract, and allows farmers with 
expiring contracts, who will not be entering into new CRP 
contracts, to begin cultivating the acreage in preparation for 
all-seeding that is subject to the expiring CRP contract after 
June 30, 1997, without penalty.
    To be eligible for this one-year CRP contract, the farm on 
which the CRP acreage is located must have had wheat, oats, or 
barley crop acreage base attributed to it when it was enrolled 
in the long-term CRP contract and be located in an area that 
regularly grows fall-seeded crops, and the owner or operator 
must have submitted a bid to enroll the acres in the expiring 
long-term CRP contract into a new long-term CRP contract. 
Additionally, farmers who are awarded a new long-term CRP 
contract before the one-year CRP contract becomes effective are 
not eligible for a one-year contract, and the one-year contract 
will not extend the duration of any such long-term CRP contract 
entered into by a farmer in subsequent CRP signups or 
enrollments. Also, if the Secretary completes enrollment for 
the bids submitted during the enrollment period that ended 
March 28, 1997 (the 15th signup), before this bill is enacted, 
then the one-year contract authority is ineffective.
    The rental rate for the one-year contract will be the rate 
bid by the farmer in USDA's 15th CRP enrollment period, which 
cannot be higher than the maximum county rental rate 
established by the Secretary of Agriculture.

                            PURPOSE AND NEED

    The CRP was reauthorized by the Federal Agriculture 
Improvement and Reform (``FAIR'') Act of 1996 (P.L. 104-127), 
which was enacted April 4, 1996. Because the signup for USDA's 
15th CRP enrollment period did not end until March 28, 1997, 
there is a potential for thousands of landowners and farm 
operators who normally seed fall crops--winter wheat, oats and 
barley--and who have submitted a bid for a new long-term CRP 
contract will not know whether they have a contract until after 
the time when they need to make planting decisions and begin 
preparing fields to plant a 1997 fall-seeded crop. H.R. 1342 
was introduced to provide a one-time, legislative remedy for 
this problem which, left uncorrected, could effectively deprive 
farmers of income from such acreage for one year.-
    Farmers with a major part of their operations currently in 
CRP need significant time for securing seed, fertilizer, and 
pesticides to plant crops on this land formerly devoted to the 
CRP contract use, and farmers also need to talk with their 
lenders to ensure credit will be available to obtain those crop 
inputs for land formerly devoted to a CRP cover crop. 
Additionally, in arid areas of the country, soil moisture is 
being consumed by the required CRP cover crop. The required CRP 
cover crop should probably have been destroyed some time ago in 
several of these areas to save moisture for a fall-seeded crop 
planting.-
    A technical correction is necessary to deal with the timing 
of USDA's 15th CRP enrollment to allow winter crop producers to 
know now if they have a CRP contract. If the Secretary awards 
producers a new, long-term contract, the one-year contract this 
legislation provides will expire. Should the landowner not 
receive a new long-term contract, then the one-year contract 
will expire on September 30, 1998, and the landowner will be 
able to rebid such acres in subsequent long-term CRP 
enrollments.

                      SECTION-BY-SECTION ANALYSIS

Section 1. One-year enrollment of land covered by expiring conservation 
        reserve program contracts

    Subsection (a) describes land eligible for a one-year 
contract: the land must be on a farm that is either partially 
or fully enrolled in a CRP contract that expires at the end of 
fiscal year 1997; the farm must have had a crop acreage base 
for wheat, oats, or barley on it when it was originally 
enrolled in the long-term CRP; the farm must be located in an 
area in which the Secretary determines fall-seeded crops are 
regularly planted; the owner or operator of the land must have 
submitted a bid to enroll all or part of the land subject to 
the expiring contract in the U.S. Department of Agriculture's 
(USDA) Farm Service Agency (FSA) 15th CRP signup (which ended 
March 28, 1997); and the land subject to the bid must meet the 
eligibility criteria for the 15th CRP signup.-
    Subsection (b) authorizes, except as provided in subsection 
(g), the owner (or operator, with the owner's permission) to 
enroll the land subject to the bid in CRP for one year, by 
notifying the Secretary of the owner or operator's intent to do 
so during a notification period established by the Secretary 
promptly after the date of enactment. If the Secretary has 
already accepted an owner or operator's bid to enroll in a 15th 
CRP long-term contract, then the owner or operator will not be 
eligible for a one-year contract.
    Subsection (c) establishes the rental rate for the one-year 
contract to be the rate which the owner or operator bid for 
enrollment in the 15th signup. In order to be an eligible bid, 
the rental rate cannot be higher than the maximum county rental 
rate established by the Secretary.
    Subsection (d) provides that a one-year contract entered 
into under this section will become the first year of any long-
term CRP contract entered into by an owner or operator in a 
subsequent signup. This will ensure that a one-year contract 
will not allow anyone to have an additional year under a long-
term contract.
    Subsection (e) limits total enrollments in fiscal year 
1998, including acreage enrolled in one-year contracts, to no 
more than 30,000,000 acres. This provision ensures that 
expenditures during fiscal year 1998 will not exceed the 
spending baseline estimate of the Congressional Budget Office.
    Subsection (f) provides that, except for the length of the 
contract, the CRP provisions of the Food Security Act of 1985, 
as amended, are applicable to the one-year contracts under this 
section.
    Subsection (g) provides that, as of the date of enactment, 
if the Secretary has already accepted or rejected the bids 
submitted during the enrollment period that ended March 28, 
1997, then section 1 shall not take effect.

Section 2. Special early termination authority for certain Conservation 
        Reserve Program contracts expiring in 1997

    Subsection (a) provides that an owner or operator (as 
described in subsection (b)) may terminate a CRP contract that 
expires during fiscal year 1997 anytime after June 30, 1997, 
without any reduction in the rental payment for fiscal year 
1997.
    Subsection (b) limits this early termination authority to 
owners and operators who: (1) did not submit a bid during 
USDA's 15th signup; or (2) submitted a bid during the 15th 
signup that was not accepted by the Secretary and did not 
notify the Secretary under section 1(b) that such owner or 
operator desired a one-year CRP contract. This limits the early 
termination authority to owners or operators who will not be 
entering into either a one-year or long-term CRP contract.
    Subsection (c) specifies that ``conservation reserve 
program contract'' means 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.).

                        committee consideration

A. General consideration

    The Committee on Agriculture met, pursuant to notice on 
April 17, 1997 with a quorum present, to consider H.R. 1342.
    Chairman Smith called the meeting to order and gave a brief 
statement regarding the Amendment in the Nature of a Substitute 
to H.R. 1342. Chairman Smith recognized Mr. Stenholm, Ranking 
Minority Member and other Members for opening remarks.
    Thereafter, Chairman Smith offered the Amendment in the 
Nature of a Substitute to H.R. 1342 and without objection the 
substitute amendment was laid before the Committee and 
considered as original text for purposes of amendment and the 
reading of such amendment was waived without objection. Counsel 
then explained the substitute amendment.
    Mr. Dooley was recognized and expressed concern about 
language in the Substitute Amendment that he believed would 
make farmland, other than conservation reserve program (CRP) 
acreage enrolled in prior CRP signups, eligible for enrollment 
in a one-year contract. After a lengthy discussion, it was 
agreed to change the language to fit the intent of the 
legislation, which was to limit farmland eligible for a one-
year contract to no more than that land on the farm enrolled in 
a prior long-term CRP contract.
    Mr. Minge was then recognized to offer and explain an 
amendment that would make land enrolled in a land conservation 
program of the State of Minnesota known as ``Reinvest in 
Minnesota'' eligible for enrollment in the conservation reserve 
upon the expiration of the Reinvest in Minnesota contract. 
Discussion occurred, and without objection, Mr. Minge withdrew 
his amendment after agreeing to report language regarding the 
eligibility of former Reinvest in Minnesota Lands in the 
conservation reserve (See part B, the ``Additional 
Consideration'' portion of this report for such report 
language).
    Mr. Peterson was recognized to offer and explain an 
amendment which would offer a one-year extension of 
Conservation Reserve Program contracts. Discussion occurred, 
and without objection Mr. Peterson withdrew his amendment.
    Mr. Peterson was further recognized to offer and explain 
another amendment regarding special early termination authority 
for Conservation Reserve Program contracts expiring in 1997. 
Discussion occurred, and by a voice vote the amendment was 
adopted (See the section-by-section analysis of section 2 for 
an explanation of such amendment).
    Mr. Bishop was recognized to offer and explain an amendment 
in conjunction with report language concerning the repeal of 
existing statutory language which designates the Conservation 
Reserve Program as a supply management tool. Discussion 
occurred, and without objection, Mr. Bishop withdrew his 
amendment after agreeing to his report language being included 
(See part B, the ``Additional Consideration'' portion of this 
report for a discussion of such report language).
    Mr. Combest was then recognized to offer and explain report 
language regarding a position of the Committee urging the 
initiation of a second long-term Conservation Reserve Program 
sign-up by USDA (the first being the 15th CRP signup) before 
the end of calendar year 1997. Discussion occurred and by 
unanimous consent the report language was adopted (See part B, 
of the ``Additional Consideration'' portion of this report for 
a discussion of such report language).
    Chairman Smith offered the technical amendment regarding 
land covered by expiring contracts as a result of earlier 
discussion by Mr. Dooley noted herein above (See paragraph four 
of this part A portion of the report). The amendment, which was 
adopted by a voice vote, clarified the Committee's intent 
relating to this language.
    Chairman Smith, without objection, called for a vote on the 
adoption of the Amendment in the Nature of a Substitute to H.R. 
1342. By a voice vote the Amendment in the Nature of a 
Substitute to H.R. 1342, as amended, was adopted.
    Mr. Combest then moved that the bill, H.R. 1342, as 
amended, be reported favorably to the House, By a voice vote, 
H.R. 1342, as amended, was ordered favorably to the House.
    Mr. Combest also moved that the Committee authorize the 
Chairman to offer such motions as may be necessary to go to 
conference with the Senate on the bill H.R. 1342 or similar 
Senate bills. By a voice vote the motion was agreed to.
    Without objection, staff was given permission make such 
technical, clarifying, or conforming changes as are appropriate 
without changing the substance of the legislation.
    The Chairman then thanked the Members and adjourned the 
meeting subject to the call of the chair.

B. Additional consideration

    The Committee is concerned that, if not properly 
implemented, this legislation could create an inequitable 
situation between two groups of contract holders. One group of 
contract holders will receive one year contracts under the 
terms of this legislation. The second group could consist of 
owners and operators who do not receive this one year contract 
or did not have their bids accepted in the 15th signup.
    The Committee expects that USDA will conduct another CRP 
enrollment before the end of calendar year 1997. Conducting 
this second long-term CRP enrollment would provide an 
opportunity for the second group of contract holders to rebid 
their land for the CRP while it is still planted in grass (or 
appropriate cover) and before owners and operators must begin 
preparing the ground for Spring planting.
    With respect to USDA's final regulations implementing the 
1996 FAIR Act changes to CRP, the Committee has several 
concerns. First, there is an expectation that the number of 
acres of filter strips, riparian buffers, field windbreaks and 
grass waterways enrolled in CRP will increase under the new 
criteria and emphasis put forward by USDA. The Committee is 
concerned that despite the emphasis on enrolling acreage in 
these environmentally sensitive areas, USDA has not yet 
provided its field personnel with adequate guidance to be 
conveyed to owners or operators as to what conditions or 
limitations may be imposed on tillage or other farming 
practices applicable to farmland adjacent to or bordered by 
these types of enrollments.
    Specifically, it will be important for landowners who have 
an interest in enrolling these types of acres to have 
assurances that they will be able to continue to normally farm 
any cropland adjacent to or bordered by the CRP acreage. In 
addition, it is important for landowners to be able to carry 
out spot control of noxious weeds through mowing and spraying 
in order to comply with applicable state laws and federal 
regulations. If USDA or other federal agencies decide to deny 
or limit access to farmland adjacent to or bordered by this 
acreage, the Committee expects to see a decrease in 
participation by landowners. Therefore, in the interest of 
ensuring the success of the CRP, it is expected that USDA will 
shortly issue common-sense guidance to reassure landowners who 
have already submitted bids or may be contemplating future 
participation in the CRP as to guidelines applicable to owners 
and operators with respect to their land adjacent to CRP 
acreage, especially those devoted to filter strips, riparian 
buffers, grass waterways, etc.
    Second, the Committee is concerned about the impact of 
USDA's final CRP regulations with respect to the eligibility of 
acreage enrolled in the old Water Bank Program and lands 
enrolled in the State of Minnesota's ``Reinvest in Minnesota'' 
(RIM) program. With respect to acreage in the old Water Bank 
Program, the Committee is concerned about the existing 
regulations limiting the eligibility of expired Water Bank 
Program acres to be enrolled in the CRP and expects the 
Secretary to revisit the issue with owners and operators 
offering bids prior to the announcement of successful bids for 
the 15th signup.
    With respect to RIM lands, the Committee notes that this 
State program parallels, on a state level, many of the 
environmental goals of the CRP. The Committee expects the 
Secretary, in developing eligibility criteria for the CRP, to 
ensure that state programs such as RIM, are fully coordinated 
with the federal CRP administered by the Secretary in order for 
the land enrolled in state programs to receive appropriate 
consideration for enrollment in the CRP. The Committee expects 
the Secretary to take whatever steps are necessary to ensure 
that these lands are not disadvantaged by their participation 
in such state programs, and that they be eligible for 
enrollment in the CRP in future signup periods or during the 
continuous signup period if applicable to the land in question.
    The Committee recognizes the ambiguous nature of section 
1236 of the Food Security Act of 1985 as a result of the 
amendments made by the Federal Agriculture Improvement and 
Reform Act of 1996. The Committee expects USDA, should they 
choose to implement this ambiguous provision, to do so in such 
a manner as to minimize any unintended consequences. Among the 
unintended consequences that concern the Committee is 
specifically any disincentive for certain farmers to 
participate in the CRP especially those whose participation 
will result in high environmental benefits. In addition, USDA 
should use the least intrusive means in implementing section 
1236, such as farm reconstitutions or other less intrusive 
procedures.

                   reporting the bill--rollcall votes

    In compliance with clause 2(l)(2) of rule XI of the House 
of Representatives, H.R. 1342 was reported by voice vote with a 
majority quorum present. There was no request for a recorded 
vote.

           budget act compliance (sections 308, 403, and 424)

    The provisions of clause 2(l)(3)(B) of rule XI of the Rules 
of the House of Representatives and section 308(a)(1) of the 
Congressional Budget Act of 1974 (relating to estimates of new 
budget authority, new spending authority, new credit authority, 
or increased or decreased revenues or tax expenditures) are not 
considered applicable. The estimate and comparison required to 
be prepared by the Director of the Congressional Budget Office 
under clause 2(l)(3)(C) of rule XI of the Rules of the House of 
Representatives and sections 403 and 424 of the Congressional 
Budget Act of 1974 submitted to the Committee prior to the 
filing of this report are as follows:

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, April 29, 1997.
Hon. Robert F. (Bob) Smith,
Chairman, Committee on Agriculture,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: As you requested, the Congressional 
Budget Office has prepared the enclosed cost estimate for an 
amended version of H.R. 1342, a bill to provide for a one-year 
enrollment in the conservation reserve of land covered by 
expiring conservation reserve program contracts.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Dave Hull.
            Sincerely,
                                         June E. O'Neill, Director.
    Enclosure.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

H.R. 1342--A bill to provide for a one-year enrollment in the 
        conservation reserve of land covered by expiring conservation 
        reserve program contracts

    Summary: H.R. 1342 would allow most land owners who (1) 
currently participate in the Conservation Reserve Program 
(CRP), and (2) have submitted bids to continue in the program, 
to extend for one-year their CRP contacts that expire during 
fiscal year 1997. To keep the size of the CRP from exceeding 
expected levels, the bill would limit the program to no more 
than 30 million acres in 1998. This version of the bill 
includes a new subsection (g) to section 1 that would preclude 
the one-year extension if the Secretary of Agriculture has 
completed enrollment action on submitted bids prior to 
enactment of the bill.
    The budgetary impact of H.R. 1342 depends on how soon the 
bill is enacted. CBO estimates that if the bill is enacted by 
about May 30, 1997, the enrollment cap would likely be 
effective, and as a result, the bill would reduce spending in 
fiscal year 1998 but would have no net impact over the 1998-
2002 period. On the other hand, if the bill is enacted later, 
the ongoing enrollment for the program would likely be 
completed, resulting in no impact on direct spending in any 
fiscal year.
    Because H.R. 1342 could affect direct spending in 1998, 
pay-as-you-go procedures would apply. H.R. 1342 contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act of 1995 (UMRA) and would not 
impose costs on state, local, or tribal governments.
    Estimated cost to the Federal Government: The CRP is a 
long-term land retirement program intended to provide 
environmental benefits through idling highly erodible or 
environmentally fragile land. The U.S. Department of 
Agriculture (USDA) pays landowners an annual rent plus part of 
the costs of establishing beneficial cover crops (referred to 
as cost-share assistance) in return for planting such crops and 
retiring the land from farming. In the first major sign-up 
since the CRP was reauthorized in the 1996 farm bill (the 
Federal Agriculture Improvement and Reform Act of 1996, Public 
Law 104-127), USDA recently invited landowners to submit bids 
for contracts to enter their erodible or environmentally 
fragile land into the CRP starting in fiscal year 1998. About 
18 million acres of land with expiring contracts from the 
existing CRP and about 8 million acres of land not previously 
covered by contracts have been offered in this sign-up.
    USDA is currently reviewing the bids and ranking them 
according to an environmental benefit index developed for this 
purpose. The Secretary of Agriculture has state his intention 
to notify landowners by late May of 1997 of the department's 
decision to accept or reject their bids. Both USDA and CBO 
expect that the accepted bids will put the size of the CRP at 
about 30 million acres in 1998.
    CBO expects that enacting H.R. 1342 before USDA notifies 
producers of its acceptance of their bids would lead the 
department to accept less acreage not formerly covered by CRP 
contracts, and to replace that land with acreage under expiring 
contracts. On the other hand, enacting this bill after USDA 
notifies producers of its acceptance of their bids would make 
the special one-year CRP authority ineffective.
    For the purposes of this estimate, we assume the Secretary 
would take action on bids he is currently reviewing on or about 
May 30, 1997. The budgetary effects of H.R. 1342, which depend 
on whether the bill is enacted by that date, are discussed 
below.

Assuming enactment by May 30, 1997

    CBO estimates that enacting this legislation before 
completion of the current enrollment (that is, before USDA 
notifies applicants of accepted bids) would decrease outlays 
from direct spending in fiscal year 1998 by about $75 million. 
Prompt enactment of H.R. 1342 would result in up-front savings 
because replacing potential new sign-ups with extensions of 
current contracts would eliminate the need for the USDA to make 
cost-share payments on 4 million acres that would otherwise be 
newly enrolled in the program. However, CBO estimates that the 
USDA, after postponing the enrollment of new acres, would 
likely include them in the program the following year. That 
action would increase direct spending for the cost-share 
payments in subsequent years, resulting in no net impact over 
five years.

Assuming enactment after May 30, 1997

    The new subsection 1(g) included in this amended version of 
H.R. 1342 makes it clear that, if the Secretary of Agriculture 
has completed enrollment action on bids submitted during the 
enrollment period that ended March 28, 1997, then the special 
one-year CRP authority in section 1 will not take effect. In 
that case, CBO estimates that enactment of the bill would have 
no budgetary impact in any fiscal year.
    The following table summarizes the estimated budgetary 
impact of H.R. 1342 under the two alternative assumptions about 
the bill's enactment date.

----------------------------------------------------------------------------------------------------------------
                                                                     By fiscal years, in millions of dollars--  
                                                                 -----------------------------------------------
                                                                   1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
Assuming Enactment by May 30, 1997:                                                                             
    Estimated budget authority..................................       0     -75      33      27      15       0
    Estimated outlays...........................................       0     -75      33      27      15       0
Assuming Enactment after May 30, 1997:                                                                          
    Estimated budget authority..................................       0       0       0       0       0       0
    Estimated outlays...........................................       0       0       0       0       0       0
----------------------------------------------------------------------------------------------------------------

    Pay-as-you-go considerations: Section 252 of the Balanced 
Budget and Emergency Deficit Control Act of 1985 sets up pay-
as-you-go procedures for legislation affecting direct spending 
or receipts through 1998. Enacting H.R. 1342 could affect 
direct spending because of the possible impact on cost-share 
payments for establishing acceptable cover crops on newly 
enrolled CRP acreage. CBO estimates that direct spending in 
fiscal year 1998 would be $75 million lower than under current 
law if the bill is enacted by May 30, 1997. (Those savings, 
however, would be offset in subsequent years, for no net impact 
over the 1998-2002 period.) If the bill is enacted later, CBO 
estimates that direct spending would not be affected in fiscal 
year 1998, or any other year.
    Estimated intergovernmental and private-sector impact: H.R. 
1342 contains no intergovernmental or private-sector mandates 
as defined in UMRA, and would impose no costs on state, local 
or private governments.
    Previous CBO estimate: On April 25, 1997, CBO completed an 
estimate of the impact of H.R. 1342, as ordered reported by the 
House Committee on Agriculture on April 17, 1997. In that 
estimate, we determined that, if the legislation were to be 
enacted after the current CRP enrollment process is completed, 
the acreage cap for 1998 would be ineffective, and direct 
spending for 1999 would increase by about $200 million. The 
current (amended) version of H.R. 1342 would render the 
authority for the special one-year CRP extension ineffective if 
the bill is enacted after USDA acts on bids from the current 
enrollment. This change would remove the possibility that 
direct costs would increase.
    Estimate prepared by: Dave Hull.
    Estimate approved by: Robert A. Sunshine, Deputy Assistant 
Director for Budget Analysis.

                   constitutional authority statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the Committee finds the 
Constitutional authority for this legislation in Article I, 
clause 8, section 18, that grants Congress the power to make 
all laws necessary and proper for carrying out the powers 
vested by Congress in the Government of the United States or in 
any department or officer thereof.

                          oversight statement

    No summary of oversight findings and recommendations made 
by the Committee on Government Reform and Oversight, as 
provided for in clause 2(l)(3)(D) of rule XI and clause 4(c)(2) 
of rule X of the Rules of the House of Representatives, was 
available to the Committee with reference to the subject matter 
specifically addressed by H.R. 1342.

                      committee oversight findings

    Pursuant to clause 2(l)(3)(A) of rule XI, and clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
the Committee on Agriculture's oversight findings and 
recommendations are reflected in the body of this report.

                        committee cost estimate

    Pursuant to clause 7(a) of rule XIII of the Rules of the 
House of Representatives, the Committee report incorporates the 
cost estimate and estimated intergovernmental and private 
sector impact of H.R. 1342, as amended, prepared by the 
Director of the Congressional Budget Office April 29, 1997 
pursuant to sections 403 and 424 of the Congressional Budget 
Act of 1974. This new estimate from the Congressional Budget 
Office is based on a Committee technical amendment to section 1 
adding a new subsection (g), that corrects a potential increase 
in direct spending for fiscal year 1999 identified in the 
Congressional Budget Office's original estimate.

                      advisory committee statement

    No advisory committee within the meaning of section 5(b) of 
the Federal Advisory Committee Act was created by this 
legislation.

                applicability to the legislative branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act (Public Law 
104-1).