HR 1658 IH

To eliminate the Federal quota and price support programs for Burley tobacco, to compensate quota holders for the lost quota value, to provide transition payments to producers of Burley tobacco, and to provide assistance to communities adversely affected by the elimination of the quota and price support programs.

To eliminate the Federal quota and price support programs for Burley tobacco, to compensate quota holders for the lost quota value, to provide transition payments to producers of Burley tobacco, and to provide assistance to communities adversely affected by the elimination of the quota and price support programs.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) SHORT TITLE- This Act may be cited as the `Burley Buy-out Act of 2001'.

(b) TABLE OF CONTENTS- The table of contents of this Act is as follows:

Sec. 1. Short title; table of contents.

TITLE I--ELIMINATION OF PRICE SUPPORT AND MARKET QUOTAS FOR BURLEY TOBACCO

Sec. 101. Burley tobacco price support program.

Sec. 102. Burley tobacco marketing quotas.

TITLE II--COMPENSATION TO QUOTA HOLDERS AND TRANSITION ASSISTANCE TO PRODUCERS OF BURLEY TOBACCO

Sec. 201. Definitions.

Sec. 202. Compensation to Burley quota holders for loss of tobacco quota asset value.

Sec. 203. Transition payments for active Burley tobacco producers.

Sec. 204. Commodity Credit Corporation.

TITLE III--ECONOMIC ASSISTANCE FOR BURLEY TOBACCO-DEPENDENT COMMUNITIES

Sec. 301. Rural economic assistance grants.

Sec. 302. Commodity Credit Corporation.

SEC. 101. BURLEY TOBACCO PRICE SUPPORT PROGRAM.

Notwithstanding section 106 of the Agricultural Act of 1949 (7 U.S.C. 1445), beginning with the 2002 crop of Burley tobacco, the Secretary of Agriculture shall not make price support available, whether in the form of loans, payments, purchases, or other operations, for any crop of Burley tobacco.

SEC. 102. BURLEY TOBACCO MARKETING QUOTAS.

Notwithstanding part I of subtitle B of title III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1311 et seq.), beginning with the 2002 crop of Burley tobacco, the Secretary shall not proclaim a national marketing quota for Burley tobacco or apportion a marketing quota for Burley tobacco among States and farms.

SEC. 201. DEFINITIONS.

In this title:

(1) ACTIVE BURLEY TOBACCO PRODUCER- The term `active Burley tobacco producer' means a person that was the actual producer, as determined by the Secretary of Agriculture, of Burley tobacco on a farm where Burley tobacco was produced pursuant to a marketing quota established under the Agricultural Adjustment Act of 1938 (7 U.S.C. 1281 et seq.) for at least two of the 1999 through 2001 marketing years.

(2) BURLEY QUOTA HOLDER- The term `Burley quota holder' means an owner of a farm on January 1, 2002, for which a Burley tobacco farm marketing quota was established under the Agricultural

(3) SECRETARY- The term `Secretary' means the Secretary of Agriculture.

SEC. 202. COMPENSATION TO BURLEY QUOTA HOLDERS FOR LOSS OF TOBACCO QUOTA ASSET VALUE.

(a) COMPENSATION REQUIRED- The Secretary shall make a payment under this section to an eligible Burley quota holder to compensate the Burley quota holder for the lost value of the quota on account of the elimination of marketing quotas for Burley tobacco under section 102.

(b) ELIGIBILITY- To be eligible to receive a payment under this section, a person shall submit to the Secretary an application containing such information as the Secretary may require to demonstrate to the satisfaction of the Secretary that the person satisfies the definition of Burley quota holder. The application shall be submitted within such time, in such form, and in such manner as the Secretary may require.

(c) BASE QUOTA LEVEL- The Secretary shall determine, for each Burley quota holder whose application for payment is approved by the Secretary under subsection (b), the base quota level of the Burley quota holder for the 1991 through 2001 marketing years. The base quota level for the Burley quota holder shall be equal to the average Burley tobacco farm marketing quota established for the 1991 through 2001 marketing years for the farm owned by the Burley quota holder.

(d) PAYMENT- The Secretary shall make a one-time payment to an eligible Burley quota holder in an amount equal to the product obtained by multiplying--

(1) $8 per pound; by

(2) the base quota level established for the Burley quota holder under subsection (c).

(e) TIME FOR PAYMENT- The payments required by this section shall be made during fiscal year 2002.

SEC. 203. TRANSITION PAYMENTS FOR ACTIVE BURLEY TOBACCO PRODUCERS.

(a) TRANSITION PAYMENTS REQUIRED- The Secretary shall make transition payments under this section to eligible active Burley tobacco producers to lessen the financial consequences to producers of the elimination of price support for Burley tobacco under section 101.

(b) ELIGIBILITY- To be eligible to receive transition payments under this section, a person shall submit to the Secretary an application containing such information as the Secretary may require to demonstrate to the satisfaction of the Secretary that the person satisfies the definition of active Burley tobacco producer. The application shall be submitted within such time, in such form, and in such manner as the Secretary may require.

(c) PRODUCTION HISTORY- The Secretary shall base the transition payments made to an active Burley tobacco producer on the average quantity of Burley tobacco subject to a marketing quota that was produced by the producer during the 1999 through 2001 marketing years.

(d) PAYMENTS- The Secretary shall make transition payments to an eligible active Burley tobacco producer in an aggregate amount equal to the product obtained by multiplying--

(1) $7.50; by

(2) the average quantity determined under subsection (c) for the producer.

(e) TIME FOR PAYMENTS- The total amount calculated for an active Burley tobacco producer under subsection (d) shall be paid to the producer in five equal installments. A payment shall be made during each of the fiscal years 2002 through 2007.

SEC. 204. COMMODITY CREDIT CORPORATION.

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

SEC. 301. RURAL ECONOMIC ASSISTANCE GRANTS.

(a) GRANT AUTHORITY- During each of the fiscal years 2002 through 2007, the Secretary of Agriculture shall use $50,000,000 of funds of the Commodity Credit Corporation to provide grants to States in which Burley tobacco is produced to assist those areas of such a State that are economically dependent on the production of Burley tobacco.

(b) GRANT BASIS- In making a grant under subsection (a) to a Burley tobacco-growing State, the Secretary shall base the amount of the grant on the following, as determined by the Secretary:

(1) The number of counties in the State in which Burley tobacco production is a significant part of the county's economy.

(2) The level of economic dependence of such counties on Burley tobacco production.

(c) USE OF GRANTS BY STATES- A State that receives a grant under subsection (a) shall use the grant to make grants to counties or other public or private entities in the State to assist areas that are dependent on the production of Burley tobacco, as determined by the Governor. The amount of a grant paid to a county or other entity to assist an area shall be based on (as determined by the Secretary)--

(1) the ratio of gross Burley tobacco sales receipts in the area to the total farm income in the area; and

(2) the ratio of all Burley tobacco related receipts in the area to the total income in the area.

(d) USE OF GRANTS BY COUNTIES- A county or other entity that receives a grant under subsection (c) shall use the grant in a manner determined appropriate by the county or entity (with the approval of the State) to assist Burley tobacco producers and other persons who are economically dependent on the production of Burley tobacco, including use for--

(1) on-farm diversification and alternatives to the production of tobacco and risk management; and

(2) off-farm activities such as development of non-tobacco related jobs.

SEC. 302. COMMODITY CREDIT CORPORATION.

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