S 1436 IS

To amend the Agricultural Market Transition Act to provide support for United States agricultural producers that is equal to the support provided to agricultural producers by the European Union, and for other purposes.

To amend the Agricultural Market Transition Act to provide support for United States agricultural producers that is equal to the support provided to agricultural producers by the European Union, 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.

This Act may be cited as the `Farm Income and Trade Equity Act of 1999'.

SEC. 2. TRANSITIONAL INTERNATIONAL MARKETING EQUITY PAYMENTS.

Subtitle B of the Agricultural Market Transition Act (7 U.S.C. 7211 et seq.) is amended by adding at the end the following:

`SEC. 119. TRANSITIONAL INTERNATIONAL MARKETING EQUITY PAYMENTS.

`(a) IN GENERAL- Not later than September 30, 1999, an owner or producer subject to a contract that is actively engaged in farming may make a 1-time election for each of the 1999 and subsequent fiscal years to--

`(1) receive a payment for a loan commodity under this section;

`(2) receive a marketing assistance loan for the loan commodity based on the loan rate established under section 132(g); and

`(3) forfeit contract payments and marketing assistance loans payable under other provisions of this subtitle and subtitle C.

`(b) PAYMENT AMOUNT- Subject to subsection (f), the amount of a payment made to an owner or producer for a crop of a loan commodity under this section shall be equal to the product obtained by multiplying--

`(1) the payment rate determined under subsection (c); by

`(2) the acreage base for the crop determined under subsection (d); by

`(3) the payment yield for the crop for the farm determined under subsection (e).

`(c) PAYMENT RATE-

`(1) WHEAT, FEED GRAINS, AND OILSEEDS-

`(A) IN GENERAL- The payment rate for a crop of wheat, corn, barley, and oilseeds under subsection (b)(1) shall be equal to the difference between--

`(i) the European Union support level for the crop determined under this paragraph; and

`(ii) the loan rate for a marketing assistance loan for the crop determined under section 132(g).

`(B) EUROPEAN UNION SUPPORT LEVEL- The European support level for a crop under subparagraph (A)(i) shall be equal to the sum of--

`(i) the intervention price paid by the European Union for the crop (in United States dollars) determined under subparagraph (C); and

`(ii) the amount of compensatory payments paid by the European Union for the crop (in United States dollars) determined under subparagraph (D).

`(C) INTERVENTION PRICE- The intervention price for a crop under subparagraph (B)(i) shall be determined by--

`(i) multiplying--

`(I) the European intervention price for the crop in euros per metric ton; by

`(II) the average European-United States exchange rate in dollars per euro during the immediately preceding 12 months; and

`(ii) dividing the product obtained under clause (i) by the number of bushels per metric ton for the crop.

`(D) COMPENSATORY PAYMENTS- The amount of compensatory payments under subparagraph (B)(ii) shall be determined by--

`(i) multiplying--

`(I) the amount of compensatory payments made by the European Union for the crop in euros per metric ton; by

`(II) the average European-United States exchange rate in dollars per euro during the immediately preceding 12 months; and

`(ii) dividing the product obtained under clause (i) by the number of bushels per metric ton for the crop.

`(E) OTHER FEED GRAINS- The payment rate for a crop of grain sorghum and oats, respectively, under subsection (b)(1) shall be established at such level as the Secretary determines is fair and reasonable in relation to the payment rate for corn under this paragraph, taking into consideration the feeding value of the commodity in relation to corn.

`(2) COTTON AND RICE- The payment rate for a crop of upland cotton, extra long staple cotton, and rice, respectively, under subsection (b)(1) shall be established at such level as the Secretary determines is fair and reasonable in relation to the payment rate for wheat under this paragraph, taking into consideration the historical price relationship

`(3) ADJUSTMENT- The Secretary may adjust the payment rate for a crop of a loan commodity under this subsection to provide support for owners and producers at a level that is consistent with the amount of compensatory payments made by the European Union for the loan commodity.

`(d) ACREAGE BASE- The acreage base for a crop of a loan commodity under subsection (b)(2) shall be 85 percent of the contract acreage.

`(e) PAYMENT YIELD- The payment yield for a crop of a loan commodity under subsection (b)(3) shall be the farm program payment yield.

`(f) MAXIMUM AMOUNT OF PAYMENTS AND LOAN GAINS-

`(1) LIMITATION ON PAYMENTS- For any fiscal year, the total amount of payments made under subsection (b)(1) to a person may not exceed $40,000.

`(2) LIMITATION ON MARKETING LOAN GAINS- For any crop year, the total amount of any gain realized by a person from repaying marketing assistance loans under subsection (a)(2) for 1 or more loan commodities at a lower level than the original loan rate established for the loan commodities under section 132 (other than subsection (g)) shall be $75,000.

`(3) REGULATION-

`(A) IN GENERAL- The Secretary shall promulgate a regulation--

`(i) defining the term `person' for purposes of this subsection that ensures, to the maximum extent practicable, that individuals of the same family, entities under the ownership or control of the same corporation, or other related parties do not receive multiple payments or marketing assistance loans under subsection (a); and

`(ii) prescribing such rules as the Secretary determines are necessary to ensure a fair and reasonable application of the limitations established under this subsection.

`(B) RELATED PROVISIONS- The regulation shall be consistent with paragraphs (5) through (7) of section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308).'.

SEC. 3. NONRECOURSE MARKETING ASSISTANCE LOANS.

Section 132 of the Agricultural Market Transition Act (7 U.S.C. 7232) is amended by adding at the end the following:

`(g) ALTERNATIVE LOAN RATE- Subject to section 119(f), notwithstanding subsections (a) through (f), in the case of an owner or producer described in section 119(a), the loan rate for a crop of a loan commodity shall be 100 percent of the simple average price received by producers of the loan commodity, as determined by the Secretary, during the marketing years for the immediately preceding 5 crops of the loan commodity, excluding the year in which the average price was the highest and the year in which the average price was the lowest.'.

SEC. 4. INCREASED AGRICULTURAL TRADE ASSISTANCE IN RESPONSE TO DIRECT EXPORT SUBSIDIES BY EUROPEAN UNION.

Section 301(e) of the Agricultural Trade Act of 1978 (7 U.S.C. 5651(e)) is amended--

(1) in paragraph (1)--

(A) by striking `The' and inserting `Subject to paragraph (3), the'; and

(B) by striking subparagraph (E) and inserting the following:

`(E) $3,850,000,000 for fiscal year 2000;'; and

(2) by adding at the end the following:

`(3) RESPONSE TO DIRECT EXPORT SUBSIDIES BY EUROPEAN UNION-

`(A) CARRYOVER- Amounts made available under subparagraphs (E) through (G) of paragraph (1) shall remain available until expended.

`(B) MINIMUM FUNDING LEVELS- Subject to paragraph (1) and subparagraphs (A) and (C), for each of fiscal years 2000 through 2002, the Commodity Credit Corporation shall make available to carry out the program established under this section and the dairy export incentive program established under section 153 of the Food Security Act of 1985 (15 U.S.C. 713a-14) an amount that is equal to the amount the Secretary determines the European Union will expend on direct export subsidies for that fiscal year.

`(C) URUGUAY ROUND TRADE AGREEMENT LIMITATION- For each of fiscal years 2000 through 2002, if the Commodity Credit Corporation is unable to comply with subparagraph (B) as the result of a limitation imposed by the Uruguay Round Trade Agreement on Agriculture, the Secretary shall increase the amount of assistance made available to carry out title I of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1701 et seq.) by an amount that, when combined with assistance made available by the Corporation under subparagraph (B), is equal to the amount that the Secretary determines the European Union will expend on direct export subsidies for that fiscal year.'.

SEC. 5. APPLICATION.

(a) IN GENERAL- Except as provided in subsection (b), this Act and the amendments made by this Act shall apply beginning with the 1999 crop of a loan commodity (as defined in section 102 of the Agricultural Market Transition Act (7 U.S.C. 7202)).

(b) AGRICULTURAL TRADE ASSISTANCE- The amendments made by section 4 shall apply beginning with fiscal year 2000.