| S 2706 IS
107th CONGRESS
2d Session
S. 2706
To improve economic
opportunity and development in communities that are dependent on tobacco
production, and for other purposes.
IN THE SENATE OF THE UNITED
STATES
June 28, 2002
Mr. CLELAND introduced the following
bill; which was read twice and referred to the Committee on Agriculture,
Nutrition, and Forestry
A BILL
To improve economic
opportunity and development in communities that are dependent on tobacco
production, and for other purposes.
Be it enacted by the
Senate and House of Representatives of the United States of America in
Congress assembled,
SECTION 1. SHORT TITLE; TABLE
OF CONTENTS.
(a) SHORT TITLE- This Act
may be cited as the `Aid to Tobacco-Dependent Communities Act of 2002'.
(b) TABLE OF CONTENTS- The
table of contents of this Act is as follows:
Sec. 1. Short title; table
of contents.
TITLE I--TOBACCO PRODUCTION
ADJUSTMENT
Subtitle A--Production Poundage
Permits for Flue-Cured and Burley Tobacco
Sec. 101. Production poundage
permits for Flue-cured and Burley tobacco.
Subtitle B--Tobacco Equity Reduction
Program
Sec. 111. Tobacco equity
reduction program.
Subtitle C--Termination of Marketing
Quotas for Flue-Cured and Burley Tobacco
Sec. 121. Definition of
covered tobacco.
Sec. 122. National marketing
quota.
Sec. 123. Apportionment
of national marketing quota.
Sec. 124. Burley tobacco
acreage allotments.
Sec. 125. Lease and transfer
of acreage allotments.
Sec. 126. Mandatory sale
of Flue-cured tobacco acreage allotments and marketing quotas.
Sec. 127. Mandatory sale
of Burley tobacco acreage allotments and marketing quotas.
Sec. 128. Acreage--poundage
quotas.
Sec. 129. Farm poundage
quotas for certain kinds of tobacco.
Subtitle D--Administration
Sec. 141. Purchase intentions
by cigarette manufacturers.
Sec. 142. Purchase requirements
and penalties.
Sec. 143. Tobacco production
and marketing information.
Sec. 144. Publication of
quotas.
Sec. 145. General adjustment
of quotas.
Sec. 146. Eminent domain.
Sec. 147. Reconstitution
of farms.
Sec. 148. Voluntary relinquishment
of allotments.
Sec. 149. Prohibition on
promotion of manufactured tobacco products.
TITLE II--TOBACCO PRICE SUPPORT
Sec. 201. Loans, payments,
and acreage reduction programs.
Sec. 202. No net cost tobacco
fund contributions and assessments.
Sec. 203. Marketing assessments.
TITLE III--TOBACCO STANDARDS
AND INSPECTIONS
Sec. 301. Tobacco standards.
Sec. 302. Tobacco inspections.
TITLE IV--ASSISTANCE TO TOBACCO-DEPENDENT
COMMUNITIES
Sec. 401. Center for Tobacco-Dependent
Communities.
Sec. 402. Tobacco Grower
Advisory Board.
Sec. 403. Interagency Task
Force on Economic Development.
Sec. 404. Report on marketing
incentives.
Sec. 405. Report on stabilization
of tobacco production opportunities.
Sec. 406. Report on taxation
impact.
TITLE V--ADMINISTRATION
Sec. 501. Marketing years.
TITLE I--TOBACCO PRODUCTION
ADJUSTMENT
Subtitle A--Production Poundage
Permits for Flue-Cured and Burley Tobacco
SEC. 101. PRODUCTION POUNDAGE
PERMITS FOR FLUE-CURED AND BURLEY TOBACCO.
Title III of the Agricultural
Adjustment Act of 1938 is amended by inserting after subtitle D (7 U.S.C.
1379a et seq.) the following:
`Subtitle E--Production Poundage
Permits for Flue-Cured and Burley Tobacco
`SEC. 380a. DEFINITIONS.
`(A) IN GENERAL- The term
`active grower' means a person that (as determined by a county committee)--
`(i) is at risk for a crop;
`(ii) provides a significant
contribution of capital, land, or equipment (within the meaning of sections
1001 and 1001A of the Food Security Act of 1985 (7 U.S.C. 1308, 1308-1),
alone or in combination with other persons;
`(iii) provides personal
labor or active personal management (within the meaning of those sections),
alone or in combination with other persons; and
`(iv) shared in the risk
of producing tobacco during--
`(I) the 2001 crop year;
and
`(II) any of the 1998, 1999,
or 2000 crop years.
`(B) PROOF- For purposes
of subparagraph (A), a determination of whether a grower is an active grower
shall be based on (as applicable, as determined by the county committee)--
`(i) invoices (including
evidence of such payments as bank statements and canceled checks) for labor,
pesticides, other chemicals, fertilizer, equipment, fuel, repairs, and
tobacco sales bills;
`(ii) documentation relating
to operating loans or other sources of operating capital and related management
decisions; or
`(iii) other proof acceptable
to the county committee that the grower is at risk for the crop.
`(2) BASE QUOTA LEVEL- The
term `base quota level' means the average quantity of basic marketing quota
for Flue-cured or Burley tobacco established for a farm for the 1997 through
1999 marketing years.
`(A) IN GENERAL- The term
`new active grower' means an individual that--
`(i) has certified to the
Secretary the intention of the grower to become an active grower (without
regard to paragraph (1)(A)(iv)); and
`(ii) has not had an interest
in the production of tobacco during the immediately preceding 5 years.
`(B) EXCLUSION- The term
`new active grower' does not include an active grower that has forfeited
or transferred a production poundage permit under section 380e or 380d(b),
respectively.
`(4) PROCLAMATION DATE-
The term `proclamation date' means--
`(A) in the case of Flue-cured
tobacco, December 15 of the calendar year preceding the marketing year
for any of the 2004 and subsequent crops; and
`(B) in the case of Burley
tobacco, February 1 of the calendar year preceding the marketing year for
any of the 2002 and subsequent crops.
`(5) QUOTA- The term `quota'
means a farm marketing quota for tobacco established under part I of subtitle
B for the marketing year for any of the 2002 or previous crops.
`(6) QUOTA OWNER- The term
`quota owner' means the owner of a farm (as of January 1, 2002) for which
a quota was established for the 2002 crop year.
`SEC. 380b. NATIONAL PRODUCTION
POUNDAGE PERMITS.
`(1) IN GENERAL- Subject
to subsection (d), not later than the proclamation date for a marketing
year for any of the 2004 and subsequent crops, the Secretary shall proclaim
a production poundage permit for Flue-cured and Burley tobacco for each
of the next 3 succeeding marketing years if the Secretary determines, with
respect to the kind of tobacco, that--
`(A) a production poundage
permit has not previously been proclaimed for the kind of tobacco as of
the beginning of the marketing year;
`(B) the marketing year
is the last year of 3 consecutive years for which production poundage permits
or marketing quotas previously proclaimed will be in effect; or
`(C) amendments have been
made in provisions establishing farm acreage allotments that will cause
material revision of the allotments before the end of the period for which
permits or quotas are in effect.
`(2) PRODUCTION POUNDAGE
PERMITS FOR SECOND AND THIRD MARKETING YEARS- The Secretary shall determine
and announce the production poundage permits for the second and third marketing
years of any 3-year period for which production poundage permits are in
effect with respect to Flue-cured and Burley tobacco on or before the proclamation
date immediately preceding the beginning of the marketing year to which
the permits apply.
`(3) NOTICE- The Secretary
shall provide notice of the production poundage permits that will be in
effect for the first marketing year covered by the referendum, to the maximum
extent practicable, by mailing a notice to each active grower prior to
the holding of any referendum.
`(1) IN GENERAL- As part
of any national production poundage permit for Flue-cured or Burley proclaimed
for a marketing year under subsection (a), the Secretary shall determine
and announce the quantity of the kind of tobacco that may be produced or
marketed under the production poundage permit.
`(2) LEVEL- Subject to paragraphs
(3) through (6), the quantity of a national production poundage permit
for Flue-cured or Burley proclaimed for a marketing year under subsection
(a) shall equal the quantity of the kind of tobacco produced in the United
States that the Secretary estimates will be used during the marketing year
in the United States and will be exported during the marketing year, as
adjusted by the Secretary for the purpose of maintaining an adequate supply
or for effecting an orderly reduction of supplies to the reserve supply
level.
`(A) IN GENERAL- For each
marketing year for which production poundage permits are in effect under
this section, the Secretary shall establish a reserve from the national
production poundage permit in a quantity equivalent to 3 percent of the
national production poundage permit to be available for--
`(i) making corrections
and adjusting inequities in active grower production poundage permits;
and
`(ii) allotting production
poundage permits to new active growers.
`(B) NEW ACTIVE GROWERS-
The Secretary shall use not less than 2/3 of the reserve for new active
growers.
`(4) LIMITATIONS- For the
marketing year for each of the 2004 and subsequent crops of Flue-cured
tobacco and Burley tobacco, the quantity of the national production poundage
permit for the kind of tobacco for a marketing year shall be equal to the
quantity of the kind of tobacco, as determined by the Secretary, that is
not more than 103 percent nor less than 97 percent of the total of--
`(A) the aggregate of the
quantities of the kind of tobacco that domestic manufacturers of cigarettes
estimate the manufacturers intend to purchase on the United States auction
markets or from active growers during the marketing year, as compiled and
determined under section 320A;
`(B) the average annual
quantity of the kind of tobacco exported from the United States during
the 3 marketing years immediately preceding the marketing year for which
the determination is being made; and
`(C) the quantity, if any,
of kind of tobacco that the Secretary determines is necessary to increase
or decrease the inventory of the grower-owned cooperative marketing association
that has entered into a loan agreement with the Commodity Credit Corporation
to make price support available to producers of the kind of tobacco to
establish or maintain the inventory at the reserve stock level for the
kind of tobacco.
`(5) INCREASE- Not later
than the following March 1, the Secretary may increase the quantity of
the production poundage permit announced under paragraph (1) by not more
than 20 percent if the Secretary determines that the increase is necessary
in order to meet market demands or to avoid undue restrictions of marketings
in adjusting the total supply to the reserve supply level.
`(1) IN GENERAL- Not later
than 30 days after the proclamation of production poundage permits under
subsection (a), the Secretary shall conduct a referendum among active growers
of Flue-cured and Burley tobacco to determine whether the active growers
of such kind of tobacco are in favor of or opposed to the permits for the
next 3 succeeding marketing years.
`(A) IN GENERAL- Except
as provided in subparagraph (B), if more than 1/3 of the active growers
voting in the referendum oppose the production poundage permits--
`(i) the Secretary shall
proclaim the results; and
`(ii) the proclaimed production
poundage permits shall not be in effect.
`(B) SUBSEQUENT PROCLAMATIONS
AND REFERENDA- The disapproval of production poundage permits in a referendum
conducted under this subsection shall not affect or limit the subsequent
proclamation and submission to a referendum of a production poundage permit
in accordance with this section.
`(d) PERMITS OR QUOTAS DISAPPROVED
IN SUCCESSIVE REFERENDA-
`(1) IN GENERAL- Except
as provided in paragraph (2), if active growers of a kind of tobacco have
disapproved production poundage permits in referenda held in 3 successive
years under subsection (c), the Secretary shall not proclaim a production
poundage permit for any marketing year within the 3-year period for which
production poundage permits previously proclaimed were disapproved by active
growers in a referendum.
`(2) PETITION- Paragraph
(1) shall not apply if, prior to November 10 of the calendar year preceding
the marketing year, at least 25 percent of the farmers engaged in the production
of the crop of tobacco harvested in the calendar year in which the marketing
year begins petition the Secretary, in accordance with such regulations
as the Secretary may promulgate, to proclaim a production poundage permit
for each of the next 3 succeeding marketing years.
`SEC. 380c. PRODUCTION POUNDAGE
PERMITS FOR INDIVIDUAL ACTIVE GROWERS.
`(a) FIRST MARKETING YEAR-
For the first marketing year for which production poundage permits are
in effect for Flue-cured or Burley tobacco under section 380b, the Secretary
shall allocate the national production poundage permit for the marketing
year (less the national reserve) among active growers of the kind of tobacco,
on a pro rata basis that reflects the quantity of the kind of tobacco active
growers were eligible to market during the marketing year for the 2002
crop of the kind of tobacco under an allotment or quota established under
part I of subtitle B.
`(b) SUCCEEDING MARKETING
YEARS-
`(1) IN GENERAL- For each
marketing year after the first marketing year for which production poundage
permits are in effect for Flue-cured or Burley tobacco under section 380b,
the quantity of a production poundage permit of an active grower for the
marketing year shall be the product obtained by multiplying--
`(A) the quantity of the
kind of tobacco allowed to be produced by the active grower under the most
recent marketing year production poundage permit issued to the active grower;
by
`(B) a national factor obtained
by dividing--
`(i) the national production
poundage permit determined under section 380b for the kind of tobacco (less
the national reserve); by
`(ii) the sum of production
poundage permits for the kind of tobacco for the most recent year for all
active growers for which production poundage permits will be determined
for the applicable marketing year.
`(A) IN GENERAL- The quantity
of a production poundage permit allotted to an active grower for a marketing
year under this subsection shall be reduced by the number of pounds by
which marketing for the active grower during the immediately preceding
year exceeded the production poundage permit of the active grower (after
adjustments).
`(B) SUBSEQUENT MARKETING
YEARS- If as a result of excess marketings in the most recent year the
quantity of the kind of tobacco allowed to be produced by an active grower
under a production poundage permit for the marketing year is reduced to
0 pounds without achieving the entire reduction required, the additional
reduction required shall be made in subsequent marketing years.
`(A) IN GENERAL- Subject
to subparagraphs (B) and (C), the quantity of a production poundage permit
for a new active grower applicant under this subsection shall be the number
of pounds determined by the county committee, with approval of the State
committee, to be fair and reasonable for the grower on the basis of--
`(i) the past experience
of the grower with respect to the kind of tobacco involved;
`(ii) the land, labor, and
equipment available for the production of the kind of tobacco, excluding
any income requirement;
`(iii) crop rotation practices;
and
`(iv) the soil and other
physical factors affecting the production of the tobacco.
`(B) MINIMUM QUANTITY- The
initial permit for any new active grower under this paragraph shall not
be less than--
`(i) 8,000 pounds of Flue-cured
tobacco; or
`(ii) 4,000 pounds of Burley
tobacco.
`(C) NATIONAL RESERVE- The
number of pounds allocated to all new active growers under this paragraph
shall not exceed that portion of the national reserve that is provided
by the Secretary for establishing production poundage permits for new active
growers.
`SEC. 380d. SALE, LEASE, OR
TRANSFER OF PERMITS.
`(a) IN GENERAL- Except
as provided in subsection (b), no permit issued under this subtitle may
be sold, leased, rented (including share or case rentals), or transferred
to any other person.
`(b) DISCONTINUATION OF
PRODUCTION OF TOBACCO-
`(1) INDIVIDUALS- In the
case of an active grower who dies or who determines not to continue producing
Flue-cured or Burley tobacco--
`(A) the permit of the active
grower may be transferred to the spouse, surviving spouse, or direct legal
descendants (as appropriate) of the active grower, in the same proportion
as the active grower held the interest; and
`(B) the spouse or descendants
shall receive all rights and be subject to all obligations as the original
active grower.
`(2) PARTNERSHIPS- In the
case of a partnership that includes an active grower described in paragraph
(1)--
`(A) the spouse, surviving
spouse, or direct descendants (as appropriate) of an active grower may
receive a permit in the same proportion as an active grower who dies or
who determines not to continue producing Flue-cured or Burley tobacco held
the interest; and
`(B) any portion of the
permit attributable to the active grower that has no spouse, surviving
spouse, or direct descendant shall be forfeited and made available for
reallocation under section 380e(d).
`(A) IN GENERAL- In the
case of a corporation, any permit shall continue to be in effect for such
period as the corporation continues to function as an active grower.
`(i) IN GENERAL- Except
as provided in clause (ii), no permit held by a corporation may be transferred
to any individual or other entity, including--
`(I) any individual or entity
that purchases the corporation; or
`(II) the successor or assign
of a corporation.
`(ii) FAMILY MEMBERS- Any
spouse, surviving spouse, or direct descendant of a stockholder of the
corporation may receive such a permit in the same proportion as is attributable
to the stockholder when the stockholder sells or otherwise transfers to
any such spouse or descendant the stockholder's ownership interest in the
corporation.
`(C) REALLOCATION- Except
as provided in subparagraph (B)(ii), if the corporation ceases to function
as an active grower, any permit of the corporation shall be reallocated
in accordance with section 380e(d).
`SEC. 380e. REDUCTIONS OR FORFEITURES.
`(a) DEFINITION OF FULLY
USED- In this section, the term `fully used' means that at least 75 percent
of the quantity of Flue-cured or Burley tobacco eligible to be marketed
under a production poundage permit is produced by an active grower and
marketed or considered by the county committee to be marketed, with no
credit provided in any future year for the failure to market the quantity
specified in the permit within any crop year, unless the failure was due
to damaging weather or related condition (as determined by the Secretary).
`(b) PERMITS THAT ARE NOT
FULLY USED- Any permit that is not fully used under this section shall
be subject to permanent reduction or forfeiture.
`(1) IN GENERAL- The relevant
county committee shall make determinations regarding reductions or forfeitures
under subsection (b) according to criteria established by the Secretary.
`(2) CRITERIA- The criteria
shall include consideration of whether conditions beyond the control of
the active grower that prevented the permit from being fully used.
`(d) REALLOCATION- Any permit
that is reduced or forfeited may be reallocated by the Secretary to other
active growers in the same county.
`SEC. 380f. AUCTION WAREHOUSES.
`(a) IN GENERAL- The Secretary
shall require that any active grower with a production poundage permit
under this subtitle greater than zero shall indicate on such form as the
Secretary shall require--
`(1) the number of pounds
of Flue-cured and Burley tobacco the grower intends to market by auction
at 1 or more warehouses designated by the active grower; and
`(2) the number of pounds
of Flue-cured and Burley tobacco the producer intends to market by non-auction.
`(b) PRICE SUPPORT- Any
active grower that fails to file a warehouse designation under this section
shall not be eligible to receive price support under the Agricultural Act
of 1949 (7 U.S.C. 1421 et seq.) for the tobacco marketed under the production
poundage permit of the grower.
`SEC. 380g. REDUCTION OF PRODUCTION
POUNDAGE PERMITS.
`(a) IN GENERAL- Subject
to subsection (b), when a production poundage permit is in effect for Flue-cured
or Burley tobacco under this subtitle, the production poundage permit of
an active grower next established for the grower shall be reduced by the
quantity of the tobacco produced by the grower--
`(1) that is marketed as
having been produced under a different permit;
`(2) for which proof of
disposition is not furnished as required by the Secretary;
`(3) as to which any grower
files, or aids or acquiesces in the filing of, any false report with respect
to the production or marketings of tobacco; and
`(4) as to which any grower
participated in any scheme or device to circumvent any requirement of the
program.
`(b) LACK OF CAUSALITY-
If the Secretary, acting through the local county committee, finds that
neither the grower, nor any person under the control or supervision of
the grower, caused, aided, or acquiesced in any action described in subsection
(a), the next established production poundage permit shall not be reduced
under this subsection.
`(c) MULTIPLE TOBACCO CROPS-
If in any calendar year more than 1 crop of tobacco is grown from the same
tobacco plants, or different tobacco plants, and is harvested for marketing
from the same acreage of a farm under this subtitle, the Secretary shall
reduce the subsequent production poundage permit for the active grower
by a quantity equivalent to the poundage of the additional crop of tobacco.
`(d) EMINENT DOMAIN- In
establishing production poundage permits for active growers displaced by
acquisition of land by any agency, as provided in section 378, only a decrease
in the production poundage permits as provided in this section shall be
made on account of marketings in excess of the production poundage permit
of a grower.
`(e) ADDITIONAL REDUCTIONS-
The reductions required under this section shall be in addition to any
other adjustments made pursuant to this subtitle.
`SEC. 380h. PENALTIES.
`(1) PENALTIES- Except as
provided in section 380b(b), when production poundage permits under this
subtitle are in effect, section 314 shall apply to this subtitle.
`(2) ADMINISTRATION- For
the purpose of paragraph (1), the marketing of tobacco in excess of a quantity
permitted under a production poundage permit under this subtitle shall
be considered the same as the marketing of tobacco in excess of a marketing
quota.
`(b) TRIGGERING QUANTITY-
`(1) IN GENERAL- No penalty
on excess tobacco shall be due or collected until 103 percent of the production
poundage permit has been marketed.
`(2) MARKETING IN EXCESS
OF TRIGGERING QUANTITY- In the case of each pound of tobacco marketed in
excess of the percentage described in paragraph (1), the full penalty rate
shall be due, payable, and collected at the time of marketing on each pound
of excess tobacco marketed.
`(3) REDUCTION IN SUBSEQUENT
PERMITS- Any tobacco marketed in excess of 100 percent of the production
poundage permit shall require a reduction in subsequent permits in accordance
with section 380g.
`(4) MARKETING OF CERTAIN
GRADES- If the Secretary determines it is desirable to encourage the marketing
of grade N2 tobacco or any grade of tobacco not eligible for price
support in order to meet the normal demands of export and domestic markets,
the Secretary may authorize the marketing of the tobacco in a marketing
year under this subtitle without the payment of penalty or deduction from
subsequent quotas in a quantity that does not exceed 5 percent of the production
poundage permit for the active grower.
`(c) FALSE INFORMATION-
Notwithstanding the third sentence of section 314(a), when production poundage
permits established under this subtitle are in effect, if any active grower
falsely identifies or fails to account for the disposition of any tobacco
or participates in any scheme or device to circumvent any requirement of
the program--
`(1) in lieu of assessing
and collecting penalties based on actual marketings of excess tobacco,
the Secretary may elect to assess a penalty computed by multiplying--
`(A) the full penalty rate;
by
`(B) a quantity of tobacco
equal to the greater of--
`(i) 25 percent of the production
poundage permit, plus the farm yield of the number of acres harvested in
excess of the production poundage permit; or
`(ii) 100 percent of the
production poundage permit (after adjustments); and
`(2) the penalty shall be
paid and remitted by the active grower.
`(d) FALSE IDENTIFICATION
OF PERMITS- Notwithstanding any other provision of this section, if an
active grower falsely identifies tobacco as having been produced or marketed
under a production poundage permit other than the production poundage permit
issued for the active grower, the quantity of tobacco falsely identified
shall be considered for purposes of establishing future production poundage
permits as having been produced on the production poundage permits of all
active growers involved in the false identification.
`SEC. 380i. REPORTS.
`(a) IN GENERAL- Each active
grower for whom a production poundage permit is established under this
subtitle shall annually file with the Secretary a report of the acreage
planted to Flue-cured and Burley tobacco.
`(b) RECORDKEEPING SYSTEM-
Not later than 180 days after the date of enactment of this subtitle, the
Secretary shall establish a computerized recordkeeping system that contains
all information reported under subsection (a) and related records, as determined
by the Secretary.'.
Subtitle B--Tobacco Equity Reduction
Program
SEC. 111. TOBACCO EQUITY REDUCTION
PROGRAM.
Subtitle H of title III
of the Agricultural Adjustment Act of 1938 (as added by section 101) is
amended by adding at the end the following:
`SEC. 380j. TOBACCO EQUITY REDUCTION
PROGRAM.
`(a) PROGRAM- The Secretary,
acting through the Commodity Credit Corporation, shall establish a tobacco
equity reduction program that is applicable to quota owners and growers
of Flue-cured and Burley quota tobacco.
`(1) IN GENERAL- Effective
beginning with the 2004 crop year, any quota owner or grower of record
of Flue-cured or Burley tobacco during the 2002 crop year shall be eligible
to receive compensation under the program.
`(2) OWNERS THAT ARE NOT
GROWERS- Any quota owner that did not grow tobacco on the farm to which
a tobacco quota applied during the 2002 crop year shall be eligible to
receive compensation under the program, except that the owner shall not
have any ownership interest in any such marketing quota after the date
on which the compensation is received.
`(3) PROPORTIONAL PAYMENT-
Any payment under this section shall be made only in an amount that is
proportional to the ownership or interest held by the recipient.
`(4) APPLICATION- To be
eligible to receive compensation under this section, any quota owner or
grower shall prepare and submit to the Secretary an application for compensation
in such form and at such time as the Secretary shall prescribe.
`(5) CRITERIA- The application
shall demonstrate to the satisfaction of the Secretary that the applicant
meets the requirements of this section.
`(1) QUOTA OWNERS- The amount
of a payment made under the program to a quota owner shall be equal to
the amount obtained by multiplying--
`(A) the base quota level
for the quota owner; by
`(2) GROWERS THAT DISCONTINUE
PRODUCTION- The amount of a payment made under the program to a grower
on a farm that agrees to discontinue production of tobacco shall be equal
to the amount obtained by multiplying--
`(A) the grower's share
of the base quota level for the farm; by
`(3) GROWERS THAT CONTINUE
PRODUCTION- The amount of a payment made under the program to a grower
on a farm that indicates an intention to continue production of tobacco
shall be equal to the amount obtained by multiplying--
`(A) the grower's share
of the base quota level for the farm; by
`(1) AGREEMENT- A payment
to a quota owner or grower under the program shall be made through the
execution of an irrevocable agreement between the Secretary and the owner
or grower.
`(A) IN GENERAL- Except
as provided in subparagraph (B), an agreement shall provide that compensation
under the program shall be made to the quota owner or grower over a period
of 5 years commencing with the date on which the agreement is signed.
`(B) SMALL QUOTA OWNERS
THAT DISCONTINUE PRODUCTION- Any quota owner that has a base quota level
of 1,000 pounds or less and that no longer intends to engage in tobacco
production may receive the total compensation for which the owner is eligible
under the program during the first year after the date on which the agreement
is signed.
`(3) GROWERS THAT DISCONTINUE
PRODUCTION-
`(A) IN GENERAL- If any
active grower agrees to discontinue production of tobacco, receives a payment
under subsection (c)(2), and has carryover tobacco, the grower shall (at
determined by the grower)--
`(i) destroy the tobacco
under the supervision of the Secretary and receive the full amount of the
payment to which the grower is entitled under this section; or
`(ii) receive the amount
of the payment to which the grower is entitled under this section, reduced
by an amount equal to the amount obtained by multiplying--
`(I) the quantity of carryover
tobacco; by
`(II) the national price-support
level for the kind of tobacco for the year produced.
`(B) TEMPORARY PERMIT- Any
grower that receives compensation under subparagraph (A)(ii) shall receive
a temporary permit authorizing the grower to market the carryover tobacco
in the subsequent marketing year.
`(C) REDUCTION OF SUBSEQUENT
QUANTITIES- Any poundage sold under the temporary permit shall be deducted
from the quantity of production poundage permits issued for growers in
the United States for the subsequent marketing year.
`(e) PAYMENT LIMITATION-
Notwithstanding any other provision of law, payments made under this section
shall not be subject to any payment limitation otherwise provided by law.'.
SEC. 112. FUNDING.
Subtitle H of title III
of the Agricultural Adjustment Act of 1938 (as added by section 111) is
amended by adding at the end the following:
`SEC. 380k. FUNDING.
`(a) DEFINITIONS- In this
section:
`(1) MARKET SHARE- The term
`market share' means the ratio of--
`(A) the tax liability of
a tobacco product manufacturer or tobacco product importer for a calendar
year under section 5703 of the Internal Revenue Code of 1986; to
`(B) the tax liability of
all tobacco product manufacturers or tobacco product importers for the
calendar year under section 5703 of the Internal Revenue Code of 1986.
`(2) TOBACCO PRODUCT IMPORTER-
The term `tobacco product importer' has the meaning given the term `importer'
in section 5702 of the Internal Revenue Code of 1986.
`(3) TOBACCO PRODUCT MANUFACTURER-
`(A) IN GENERAL- The term
`tobacco product manufacturer' has the meaning given the term `manufacturer
of tobacco products' in section 5702 of the Internal Revenue Code of 1986.
`(B) EXCLUSION- The term
`tobacco product manufacturer' does not include a person that manufactures
cigars or pipe tobacco.
`(b) DETERMINATIONS- Not
later than September 30 of each fiscal year, the Secretary shall--
`(A) the market share of
each tobacco product manufacturer or tobacco product importer during the
most recent calendar year;
`(B) the total amount of
assessments payable for the subsequent fiscal year under subsection (c);
and
`(C) the amount of an assessment
payable by the tobacco product manufacturer or tobacco product importer
for the fiscal year under subsection (d); and
`(2) notify each tobacco
product manufacturer and tobacco product importer of the determinations
made under paragraph (1) with respect to the manufacturer or importer.
`(c) TOTAL AMOUNT OF ASSESSMENTS-
`(1) IN GENERAL- The total
amount of assessments payable by all tobacco product manufacturers and
tobacco product importers to the Secretary and the Commodity Credit Corporation
for a fiscal year shall be equal to--
`(A) the amount of the contribution
for the fiscal year required under paragraph (2); less
`(B) any amount made available
during the preceding fiscal year to the Secretary and the Commodity Credit
Corporation out of funds allocated through national tobacco settlement
legislation.
`(2) CONTRIBUTIONS- The
amount of the contribution for each fiscal year under paragraph (1)(A)
shall be the amount necessary to carry out during the fiscal year the Aid
to Tobacco-Dependent Communities Act of 2002 and the amendments made by
that Act, as determined by the Secretary.
`(d) INDIVIDUAL AMOUNT OF
ASSESSMENTS- The amount of an assessment payable by each tobacco product
manufacturer and tobacco product importer under this section for a fiscal
year shall be equal to the product obtained by multiplying--
`(1) the total amount of
assessments payable by all tobacco product manufacturers and tobacco product
importers for the fiscal year under subsection (c); by
`(2) the market share of
the tobacco product manufacturer or tobacco product importer during the
most recent calendar year determined under subsection (b)(1)(A).'.
Subtitle C--Termination of Marketing
Quotas for Flue-Cured and Burley Tobacco
SEC. 121. DEFINITION OF COVERED
TOBACCO.
Part I of subtitle B of
title III of the Agricultural Adjustment Act of 1938 is amended by inserting
before section 311 (7 U.S.C. 1311) the following:
`SEC. 310. DEFINITION OF COVERED
TOBACCO.
`In this part, the term
`covered tobacco' means any kind of tobacco other than Flue-cured or Burley
tobacco.'.
SEC. 122. NATIONAL MARKETING
QUOTA.
Section 312 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1312) is amended--
(1) in subsection (a), by
striking `December 1' and all that follows through `other kinds of tobacco'
and inserting `March 1 of any marketing year with respect to covered tobacco';
and
(2) in the first sentence
of subsection (b), by striking `the first day of December' and all that
follows through `other kinds of tobacco' and inserting `March 1 with respect
to covered tobacco'.
SEC. 123. APPORTIONMENT OF NATIONAL
MARKETING QUOTA.
Section 313 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1313) is amended--
(A) by striking `quota:
Provided,' and all that follows through `acre: And provided further,
That' and inserting `quota, except that'; and
(B) by striking `practices:
And provided further,' and all that follows and inserting `practices.';
(2) in the proviso of subsection
(b), by striking `(1)' and all that follows through `or (2)' and inserting
`(1) 2,400 pounds, in the case of covered tobacco, or (2)';
(3) by striking subsection
(e); and
(4) in paragraph (2) of
the third sentence of subsection (g), by striking `three thousand' and
all that follows through `tobacco: Provided, That' and inserting
`2,400 pounds, in the case of covered tobacco, except that'.
SEC. 124. BURLEY TOBACCO ACREAGE
ALLOTMENTS.
The Act entitled `An Act
relating to burley tobacco farm acreage allotments under the Agricultural
Adjustment Act of 1938, as amended', approved July 12, 1952 (7 U.S.C. 1315),
is repealed.
SEC. 125. LEASE AND TRANSFER
OF ACREAGE ALLOTMENTS.
Section 316 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1314b) is amended--
(1) by striking the section
heading and all that follows through `(A)(i) The' and inserting the following:
`SEC. 316. LEASE AND TRANSFER
OF ACREAGE ALLOTMENTS.
`(a) IN GENERAL- Notwithstanding
any other provision of law, the';
(A) by striking `Burley,
Flue-cured,'; and
(B) by striking `(ii) The
Secretary' and all that follows;
(A) by striking paragraph
(2); and
(B) by redesignating paragraph
(3) as paragraph (2); and
(4) by striking subsection
(g) through the end of the section.
SEC. 126. MANDATORY SALE OF
FLUE-CURED TOBACCO ACREAGE ALLOTMENTS AND MARKETING QUOTAS.
Section 316A of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1314b-1) is repealed.
SEC. 127. MANDATORY SALE OF
BURLEY TOBACCO ACREAGE ALLOTMENTS AND MARKETING QUOTAS.
Section 316B of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1314b-2) is repealed.
SEC. 128. ACREAGE--POUNDAGE
QUOTAS.
Section 317 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1314c) is amended--
(i) by striking `(1)(A)'
and inserting `(1)'; and
(ii) by striking subparagraphs
(B) and (C);
(B) in paragraph (2), by
striking the last sentence;
(C) in paragraph (4), by
striking the second and third sentences; and
(D) by striking paragraph
(5) and all that follows through the end of the first sentence of paragraph
(6)(B) and inserting the following:
`(5) COMMUNITY AVERAGE YIELD-
The term `community average yield' means, for covered tobacco, the average
yield per acre in the community designated by the Secretary as a local
administrative area under section 8(b) of the Soil Conservation and Domestic
Allotment Act (16 U.S.C. 590h(b)), which is determined by averaging the
yields per acre for the 3 highest years of the 1960 through 1964 crop years,
except that if the yield for any of the 3 highest years is less than 80
percent of the average for the 3 years, that 1 or more years shall be eliminated
and the average of the remaining years shall be the community average yield.
`(6) PRELIMINARY FARM YIELD-
`(A) IN GENERAL- The term
`preliminary farm yield' for covered tobacco means a farm yield per acre
determined by averaging the yield per acre for the 3 highest years of the
immediately preceding 5 crops year, except that--
`(i) if that average exceeds
120 percent of the community average yield the preliminary farm yield shall
be the sum of 50 percent of the average of the 3 highest years and 50 percent
of the national average yield goal but not less than 120 percent of the
community average yield; and
`(ii) if the average of
the 3 highest years is less than 80 percent of the community average yield
the preliminary farm yield shall be 80 percent of the community average
yield.
(2) by striking subsection
(b);
(3) in the first sentence
of subsection (c)--
(A) by striking `, including
Flue-cured tobacco,'; and
(B) in the proviso, by striking
`except Flue-cured tobacco';
(A) in the first sentence,
by striking `December 15 of any marketing year with respect to Flue-cured
tobacco, and March 1 with respect to other kinds of tobacco' and inserting
`March 1 with respect to covered tobacco';
(B) by striking the second
and fourth sentences;
(C) in the eighth sentence,
by striking `the December 15 with respect to Flue-cured tobacco and the
March 1 with respect to other kinds of tobacco' and inserting `the March
1 with respect to covered tobacco'; and
(D) by striking the last
2 sentences;
(5) in subsection (f), by
striking the last sentence;
(6) in subsection (g)(1),
by striking `(120 per centum' and all that follows through `section)';
(7) by striking subsections
(h), (i), (k), and (l); and
(8) by redesignating subsection
(j) as subsection (h).
SEC. 129. FARM POUNDAGE QUOTAS
FOR CERTAIN KINDS OF TOBACCO.
Section 319 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1314e) is amended--
(1) by striking subsection
(a);
(A) in paragraph (1), by
striking `Except as provided in paragraph (3), the' and inserting `The';
and
(B) by striking paragraph
(3);
(A) in the first sentence,
by striking `for the marketing year beginning October 1, 1970, in the case
of burley tobacco, and'; and
(B) in the second sentence--
(i) by striking `the five
consecutive years beginning with the 1966 crop year, in the case of burley
tobacco, and'; and
(ii) in the third proviso,
by striking `three thousand five hundred pounds per acre, in the case of
burley tobacco, and';
(A) by striking the first
sentence; and
(B) by striking the second
proviso;
(i) by striking `(1)'; and
(ii) by striking the third
and fourth provisos; and
(B) by striking paragraphs
(2) and (3);
(6) by striking subsection
(h);
(7) in subsection (i)(3),
by striking the second and third sentences; and
(8) by striking subsections
(k), (l), (m), and (n).
Subtitle D--Administration
SEC. 141. PURCHASE INTENTIONS
BY CIGARETTE MANUFACTURERS.
Section 320A(a)(1) of the
Agricultural Adjustment Act of 1938 (7 U.S.C. 1314g(a)(1)) is amended--
(1) by striking `(or, in
the case of the 1986 crop, 14 days after the date of enactment of the Consolidated
Omnibus Budget Reconciliation Act of 1985)';
(2) by striking `(or, in
the case of the 1986 crop, 14 days after the date of enactment of such
Act or January 15, 1986, whichever is later)'; and
(3) by striking `marketing
quota' each place it appears and inserting `production poundage permit'.
SEC. 142. PURCHASE REQUIREMENTS
AND PENALTIES.
Section 320B of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1314h) is amended--
(1) by striking `quota tobacco'
each place it appears and inserting `covered tobacco';
(A) in paragraph (1), by
striking `at least 90 percent of'; and
(B) in paragraph (2)(A)--
(i) by striking `marketing
quota' each place it appears and inserting `production poundage permit';
and
(ii) by striking `or undermarketings'
each place it appears;
(A) by striking paragraph
(1) and inserting the following:
`(1) the penalty rate for
the applicable kind of tobacco under section 314(a); by'; and
(B) in paragraph (2)(B),
by striking `90 percent of'; and
(4) in subsection (f), by
striking `marketing quotas' each place it appears and inserting `production
poundage permits'.
SEC. 143. TOBACCO PRODUCTION
AND MARKETING INFORMATION.
(a) IN GENERAL- Section
320D(a) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1314i(a))
is amended--
(1) by striking `Notwithstanding'
and inserting the following:
`(1) STATE TRUSTS AND SIMILAR
ORGANIZATIONS- Notwithstanding'; and
(2) by adding at the end
the following:
`(A) IN GENERAL- The Secretary
shall collect and disseminate information from foreign countries regarding
production, consumption, and such other information related to production
and consumption of tobacco in such countries as the Secretary determines
appropriate.
`(B) INFORMATION- The information
shall include material related to market development, international trade
agreements and negotiations, economic research, and the collection and
analysis of statistics and market information.'.
(b) CONFORMING AMENDMENT-
Section 320D(e)(2) of the Agricultural Adjustment Act of 1938 (7 U.S.C.
1314i(e)(2)) is amended by inserting `or production poundage permits' after
`quotas'.
SEC. 144. PUBLICATION OF QUOTAS.
(a) APPLICABILITY- Section
361 of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1361) is amended--
(1) by striking `This' and
inserting `Except as otherwise provided in this Act, this'; and
(2) by inserting `or production
poundage permits' after `quotas'.
(b) PUBLICATION AND NOTICE-
Section 362 of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1362)
is amended--
(1) in the first sentence,
by inserting `or production poundage permits' after `quotas';
(2) in the third sentence--
(A) by inserting `or production
poundage permit' after `quota'; and
(B) by inserting `or active
grower' after `farmer'; and
(3) in the fourth sentence--
(A) by inserting `or production
poundage permit' after `allotment' each place it appears;
(B) by inserting `or active
grower' after `each farm'; and
(C) by inserting `or active
grower' after `operator'.
(c) INAPPLICABILITY TO TOBACCO-
Part I of subtitle C of title III of the Agricultural Adjustment Act of
1938 (7 U.S.C. 1361 et seq.) is amended by adding at the end the following:
`SEC. 369. INAPPLICABILITY TO
TOBACCO.
`Sections 363 through 368
shall not apply to tobacco.'.
SEC. 145. GENERAL ADJUSTMENT
OF QUOTAS.
Section 371 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1371) is amended--
(1) in subsection (a), by
inserting `or production poundage permits' after `quotas' each place it
appears;
(A) in the first sentence,
by inserting `or production poundage permit' after `acreage allotment';
and
(B) in the second sentence,
by inserting `, permit,' after `such quota'; and
(3) in subsection (c) by
inserting `, production poundage permit,' after `quota' each place it appears.
SEC. 146. EMINENT DOMAIN.
Section 378(f) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1378(f)) is amended--
(1) by striking `(f) In
applying the provisions of this' and inserting the following:
`(f) APPLICATION TO FARMS
WITH QUOTAS OR PERMITS-
`(1) QUOTAS- In applying
this'; and
(2) by adding at the end
the following:
`(2) PERMITS- In applying
this section to production poundage permits for Flue-cured and Burley tobacco
established under this Act:
`(A) ALLOTMENT- The term
`allotment' means a production poundage permit for Flue-cured or Burley
tobacco.
`(B) OWN- The term `own'
means, with respect to an active grower, to own or lease land.
`(C) OWNER- The term `owner'
means an active grower to whom a permit has been issued.'.
SEC. 147. RECONSTITUTION OF
FARMS.
Section 379 of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1379) is amended--
(1) in subsection (a)(6),
by striking all after `uses' and inserting a period; and
(2) in subsection (b), by
striking `if (1)' and all that follows through `(2)'; and
(3) by striking subsection
(c).
SEC. 148. VOLUNTARY RELINQUISHMENT
OF ALLOTMENTS.
Section 803 of the Agriculture
Act of 1970 (16 U.S.C. 590q-2) is amended--
(1) by inserting `, production
poundage permit,' after `allotment' each place it appears; and
(2) by inserting `, or active
grower in the case of a production poundage permit for tobacco,' after
`farm'.
SEC. 149. PROHIBITION ON PROMOTION
OF MANUFACTURED TOBACCO PRODUCTS.
Part I of subtitle F of
title III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1381 et
seq.) is amended by adding at the end the following:
`SEC. 390A. PROHIBITION ON PROMOTION
OF MANUFACTURED TOBACCO PRODUCTS.
`Notwithstanding any other
provision of law, no officer or employee of the Federal Government, or
any agent acting on behalf of an officer or employee, shall have any authority
under this or any other Act--
`(1) to promote the sale
or export of a manufactured tobacco product; or
`(2) to seek the reduction
or removal by any foreign country of a restriction on the marketing of
manufactured tobacco products, except for a restriction that is not applied
equally to all manufactured tobacco products of the same type.'.
TITLE II--TOBACCO PRICE SUPPORT
SEC. 201. LOANS, PAYMENTS, AND
ACREAGE REDUCTION PROGRAMS.
(a) AVAILABILITY OF PRICE
SUPPORT- Section 106(c) of the Agricultural Act of 1949 (7 U.S.C. 1445(c))
is amended--
(1) by inserting `, or production
poundage permits,' after `quotas';
(2) by inserting `, or subtitle
E of title III,' after `317 or 319';
(3) by inserting `or permit'
after `quota'; and
(4) by inserting `or grower
by which the tobacco was produced, as applicable' after `produced,'.
(b) LEVEL OF SUPPORT- Section
106(f) of the Agricultural Act of 1949 (7 U.S.C. 1445(f)) is amended--
(1) in paragraph (6)(A),
by striking `(other than Flue-cured and Burley tobacco)'; and
(A) in subparagraph (A),
by inserting `or production poundage permits' after `quotas'; and
(B) in subparagraph (B)(v),
by striking `purchase or leasing of quotas,'.
(c) SUPPORT LEVEL REDUCTION-
Section 106(f) of the Agricultural Act of 1949 (7 U.S.C. 1445(f)) is amended
by adding at the end the following:
`(9) REDUCTION AT REQUEST
OF ASSOCIATION-
`(A) IN GENERAL- Notwithstanding
any other provision of this subsection, if requested by the board of directors
of an association through which price support for Flue-cured or Burley
tobacco is made available to growers, the Secretary may reduce the support
level for the tobacco to the extent requested by the association to more
accurately reflect the market value and improve the marketability of the
tobacco.
`(B) NO EFFECT ON SUBSEQUENT
YEARS- Any reduction under subparagraph (A) shall not be used in establishing
the support rate for that kind of tobacco in any year subsequent to the
reduction.'.
(d) TECHNICAL AMENDMENT-
Section 106 of the Agricultural Act of 1949 (7 U.S.C. 1445) is amended
by striking subsection (g).
SEC. 202. NO NET COST TOBACCO
FUND CONTRIBUTIONS AND ASSESSMENTS.
(a) DEFINITIONS- Section
106A of the Agricultural Act of 1949 (7 U.S.C. 1445-1) is amended--
(1) by striking `quota tobacco'
each place it appears and inserting `covered tobacco'; and
(A) in paragraph (6), by
striking all after `Flue-cured' and inserting `, Burley, or other kinds
of quota or production poundage permit tobacco; and'; and
(B) in paragraph (7), by
inserting `or production poundage permits' after `quotas' each place it
appears.
(b) CONTRIBUTIONS AND ASSESSMENTS-
Section 106A(d) of the Agricultural Act of 1949 (7 U.S.C. 1445-1(d)) is
amended--
(A) in subparagraph (A)--
(i) in clause (ii), by striking
`and Burley' and inserting `, Burley, and other kinds of'; and
(I) by striking `or Burley'
and inserting `, Burley, or all other kinds of quota tobacco'; and
(II) in subclause (II),
by striking `and Burley' and inserting `, Burley, and other kinds of quota';
and
(B) in subparagraph (B),
by striking `account.' and inserting `account, and only 2002 and subsequent
crops of other kinds of tobacco shall be taken into account.'; and
(2) in paragraph (2)(B),
by striking `warehouseman' each place it appears and inserting `warehouse
operator'.
(c) RECEIVING STATIONS-
Section 106A of the Agricultural Act of 1949 (7 U.S.C. 1445-1) is amended
by adding at the end the following:
`(1) IN GENERAL- An association
may establish receiving stations to receive tobacco in any geographical
area where it is determined by an association (with the concurrence of
the Commodity Credit Corporation) that active growers in the area do not
have access to traditional auction markets.
`(2) OPPORTUNITY TO PURCHASE
TOBACCO- Any buyer of tobacco shall be afforded an opportunity to purchase
tobacco delivered to any receiving station established under this subsection
prior to the tobacco being pledged as security for price support loans.'.
SEC. 203. MARKETING ASSESSMENTS.
(a) DEFINITIONS- Section
106B(a) of the Agricultural Act of 1949 (7 U.S.C. 1445-2(a)) is amended--
(1) in paragraph (5), by
inserting `or production poundage permits' after `quotas' each place it
appears;
(2) in paragraph (8), by
striking `or Burley' and inserting `, Burley, or other kinds of'; and
(3) by adding at the end
the following:
`(9) QUOTA- The term `quota'
means a marketing quota or production poundage permit.'.
(b) PAYMENT OF ASSESSMENT-
Section 106B(d) of the Agricultural Act of 1949 (7 U.S.C. 1445-2(d)) is
amended--
(A) in subparagraph (B),
by striking `and Burley quota' and inserting `, Burley, and all other kinds
of quota'; and
(B) in subparagraph (C),
by striking `and Burley' and inserting `, Burley, and all other kinds of
quota';
(2) in paragraph (2)(A),
by striking `account.' and inserting `account, and only 2002 and subsequent
crops of other kinds of tobacco shall be taken into account.'; and
(3) in paragraph (3)(D),
by striking `or Burley' and inserting `, Burley, or any other kind of quota'.
(c) RECEIVING STATIONS-
Section 106B of the Agricultural Act of 1949 (7 U.S.C. 1445-2) is amended
by adding at the end the following:
`(1) IN GENERAL- An association
may establish receiving stations to receive quota tobacco in any geographical
area where it is determined by an association (with the concurrence of
the Commodity Credit Corporation) that active growers in the area do not
have access to traditional auction markets.
`(2) OPPORTUNITY TO PURCHASE
TOBACCO- Any buyer of tobacco shall be afforded an opportunity to purchase
quota tobacco delivered to any receiving station established under this
subsection prior to the tobacco being pledged as security for price support
loans.'.
SEC. 204. DEFINITIONS.
Section 408 of the Agricultural
Act of 1949 (7 U.S.C. 1428) is amended by adding at the end the following:
`(m) ACTIVE GROWER- The
term `active grower' has the meaning given the term in section 301(c) of
the Agricultural Adjustment Act of 1938 (7 U.S.C. 1308(c)).
`(n) PRODUCTION POUNDAGE
PERMIT- The term `production poundage permit' means a permit issued to
an active grower for the purpose of producing tobacco.'.
TITLE III--TOBACCO STANDARDS
AND INSPECTIONS
SEC. 301. TOBACCO STANDARDS.
(a) DEFINITION- The first
section of the Tobacco Inspection Act (7 U.S.C. 511) is amended by adding
at the end the following:
`(j) NONAUCTION SALE- The
term `nonauction sale' means a sale of tobacco by contract or means other
than through a sale at auction.'.
(b) FINDINGS- Section 2
of the Tobacco Inspection Act (7 U.S.C. 511a) is amended by inserting after
`markets' the following: `or by nonauction sale (including receiving stations
operated by loan associations under sections 106A and 106B of the Agricultural
Act of 1949 (7 U.S.C. 1445-1 and 1445-2)'.
(c) CERTIFICATION OF GRADE-
Section 8 of the Tobacco Inspection Act (7 U.S.C. 511g) is amended--
(1) by striking `Warehousemen'
and inserting `Warehouse operators or other purchasers of tobacco'; and
(2) by striking `warehouse'
each place it appears.
(d) APPLICABILITY- The Tobacco
Inspection Act is amended--
(1) by redesignating section
18 (7 U.S.C. 511q) as section 19; and
(2) by inserting after section
17 (7 U.S.C. 511p) the following:
`SEC. 18. APPLICABILITY TO NONAUCTION
SALE OF TOBACCO.
`This Act also shall apply
to any nonauction sale of tobacco.'.
SEC. 302. TOBACCO INSPECTIONS.
(a) TOBACCO TO BE INSPECTED-
Section 213(a)(1) of the Tobacco Adjustment Act of 1983 (7 U.S.C. 511r(a)(1))
is amended--
(1) by striking `, except
tobacco described in paragraph (2),'; and
(2) by striking `through
a warehouse'.
(b) UNIFORMITY OF STANDARDS-
Section 213(b) of the Tobacco Adjustment Act of 1983 (7 U.S.C. 511r(b))
is amended--
(1) by striking `through
a warehouse'; and
(2) by inserting before
the period the following: `, including oriental tobacco regardless of whether
the tobacco is not produced in the United States'.
(c) CERTIFICATION- Section
213(e) of the Tobacco Adjustment Act of 1983 (7 U.S.C. 511r(e)) is amended--
(1) in paragraphs (1), (4),
and (5), by striking `flue-cured or burley' each place it appears; and
(2) in paragraphs (2) and
(3), by striking `flue-cured and burley' and inserting `all'.
(d) IDENTIFICATION OF END
USERS- Section 213(f)(1) of the Tobacco Adjustment Act of 1983 (7 U.S.C.
511r(f)(1)) is amended in the second sentence by striking `flue cured or
burley'.
TITLE IV--ASSISTANCE TO TOBACCO-DEPENDENT
COMMUNITIES
SEC. 401. CENTER FOR TOBACCO-DEPENDENT
COMMUNITIES.
(a) FINDINGS- Congress finds
that--
(1) tobacco production is
conducted extensively in a number of States;
(2) tobacco production generates
significant income in local communities, which are dependent on the production
for economic vitality;
(3) many tobacco-producing
communities are facing significant challenges in developing nontobacco
income, and are quite dependent on tobacco and vulnerable to changes in
the tobacco-growing industry;
(4) greater analysis and
study is needed of economic conditions in the communities in order to gain
critical information, including analysis and study of--
(A) the interconnections
among various tobacco-related activities;
(B) the degree to which
the economic base of the communities is diversified; and
(C) the extent to which
the communities are dependent on other declining economic sectors; and
(5) while tobacco-growing
States have some financial resources to support community revitalization,
few States have the resources necessary to provide the support that tobacco-dependent
communities, quota owners, and growers require to transition successfully
from a tobacco-dependent economy to a thriving, diversified economic base.
(1) IN GENERAL- There is
authorized to be established a nonprofit corporation, to be known as the
`Center for Tobacco-Dependent Communities', which will not be an agency
or establishment of the United States Government.
(2) LAWS- The Center shall
be subject to--
(B) to the extent consistent
with this section, the laws (including regulations) of the State where
the Center is incorporated applicable to nonprofit corporations.
(A) IN GENERAL- The Center
shall have a Board of Directors consisting of 7 members, of which--
(i) 6 members shall be appointed
by the President, by and with the advice and consent of the Senate; and
(ii) 1 member shall be appointed
by the other members of the Board, who shall serve as Executive Director
of the Center.
(B) POLITICAL PARTY- Of
the members appointed by the President under subparagraph (A)(i), not more
than 3 of the members may be members of the same political party.
(C) QUALIFICATIONS- Each
member of the Board appointed by the President under subparagraph (A)(i)
shall--
(i) be a citizen of the
United States;
(ii) have knowledge and
experience regarding the matters for which the Center is responsible; and
(iii) be eminent in issues
related to rural development, including--
(I) small-crop agriculture;
(II) entrepreneurial activity;
and
(III) industrial, small
business, and community development.
(2) DUTIES OF INITIAL BOARD-
The members of the initial Board of Directors shall--
(A) serve as incorporators;
and
(B) take whatever actions
are necessary to establish the Center under the laws (including regulations)
of the State where the Center is incorporated.
(A) IN GENERAL- The term
of office of each member of the Board appointed by the President shall
be 4 years, except that of the members initially appointed, 3 members shall
serve for a 2-year term.
(B) EXPIRATION OF TERM-
Any member whose term has expired may serve until the successor of the
member has taken office or until the end of the calendar year in which
the term of the member has expired, whichever is earlier.
(i) IN GENERAL- Any member
appointed to fill a vacancy occurring prior to the expiration of the term
for which the
predecessor of the member was
appointed shall be appointed for the remainder of the term.
(ii) POWERS- Any vacancy
on the Board shall not affect the powers of the Board and shall be filled
in a manner consistent with this section.
(D) CONSECUTIVE TERMS- No
member of the Board shall be eligible to serve in excess of 2 consecutive
full terms.
(A) IN GENERAL- A member
of the Board shall attend not less than 50 percent of all meetings of the
Board in any calendar year.
(B) FAILURE TO ATTEND MEETINGS-
If a member fails to meet the requirement of subparagraph (A)--
(i) the member shall forfeit
membership on the Board; and
(ii) not later than 30 days
after the vacancy is determined by the Chairperson of the Board, the President
shall appoint a new member to fill the vacancy.
(C) PUBLIC MEETINGS- All
meetings of the Board, including any committee of the Board, shall be open
to the public.
(A) CHAIRPERSON AND VICE
CHAIRPERSON- Members of the Board shall annually elect--
(i) 1 member of the Board
to serve as Chairperson; and
(ii) 1 or more members of
the Board to serve as Vice Chairpersons.
(B) NONFEDERAL EMPLOYEES-
A member of the Board shall not, by reason of membership on the Board,
be an officer or employee of the United States.
(i) IN GENERAL- Subject
to clause (ii), a member of the Board shall, while attending a meeting
of the Board or while engaged in duties related to the meeting or other
activities of the Board pursuant to this section, be entitled to receive
compensation at the rate of $150 per day, including travel time.
(ii) LIMITATION- No member
of the Board shall receive compensation of more than $10,000 for any fiscal
year.
(D) EXPENSES- While away
from the home or regular place of business, a member of the Board shall
be allowed travel and actual, reasonable, and necessary expenses.
(d) OFFICERS AND EMPLOYEES-
(1) IN GENERAL- Subject
to paragraph (2), the Center shall have a President, and such other officers
and employees as may be appointed by the Board, for terms and at rates
of compensation fixed by the Board.
(2) COMPENSATION LIMITATION-
No officer or employee of the Corporation may be compensated by the Corporation
at an annual rate of pay that exceeds the rate of basic pay in effect for
level I of the Executive Schedule under section 5312 of title 5, United
States Code.
(3) CITIZENSHIP- To be eligible
to be an officer or employee of the Center, an individual shall be a citizen
of the United States.
(A) IN GENERAL- Except as
provided in subparagraph (B), no officer or employee of the Center, other
than the Chairperson or Vice Chairperson, may receive any salary or other
compensation from any sources other than the Center for services rendered
during the period of employment by the Center.
(B) EXCEPTIONS- With the
advance approval of the Board and subject to ethical guidelines established
by the Board, an office or employee of the Center may receive compensation
for--
(i) service on a board of
directors of an organization that does not receive funds from the Center;
(ii) service on a committee
of a board described in clause (i); and
(iii) similar activities
for an organization described in clause (i).
(5) TENURE- An officer or
employee of the Center shall serve at the pleasure of the Board.
(6) NONPOLITICAL POSITION-
Except as provided in subsection (c)(1)(B), no political test or qualification
shall be used in selecting, appointing, promoting, or taking other personnel
actions with respect to an officer, employee, or agent of the Center.
(e) NONPROFIT AND NONPOLITICAL
NATURE OF THE CENTER-
(1) NO STOCK OR DIVIDENDS-
The Center shall have no power to issue any shares of stock or to declare
or pay any dividends.
(2) USE OF INCOME OR ASSETS-
No part of the income or assets of the Center shall inure to the benefit
of any director, officer, employee, or any other individual except as salary
or reasonable compensation for services.
(3) POLITICAL CONTRIBUTIONS-
The Center may not contribute to or otherwise support any political party
or candidate for elective public office.
(1) PURPOSES- The purposes
of the Center are--
(A) to provide economic
and community development assistance for tobacco communities to assist
the communities in making the transition from tobacco-based economies;
(B) to provide primarily
agricultural and entrepreneurial assistance to the communities, including
outreach and education to tobacco quota owners, growers, and other persons
(including small communities) with limited ability
to obtain access to economic
development resources; and
(C) in particular, to provide
assistance to tobacco-producing communities identified by the Secretary
(acting through the Economic Research Service), with emphasis on those
communities that are especially dependent on tobacco production for the
generation of revenue.
(2) POWERS- In carrying
out paragraph (1), the Center may--
(A) provide communities
and producers with targeted technical assistance;
(B) convene meetings and
conduct workshops and conferences;
(C) serve as a clearinghouse
for exchange of information regarding best industry practices;
(D) provide research and
policy development activities;
(E) serve as an advocate
for communities making the transition from tobacco-based economies;
(F) make grants to individuals
or entities, including challenge grants, community mini-grants, technical
assistance grants, and grants for pilot projects and demonstrations;
(G) hire or accept the voluntary
services of consultants, experts, advisory boards, and panels to aid the
Center in carrying out the purposes of this section;
(H) accept bequests, donations,
and other forms of assistance; and
(I) take such other actions
as may be necessary to accomplish the purposes described in paragraph (1).
(3) NO FEDERAL FUNDS- Subject
to subsection (i), nothing in this subsection commits the Federal Government
to provide any funds for the payment of any obligation of the Center.
(4) CUSTOMARY POWERS- To
carry out this subsection, the Center shall have the customary powers conferred
on a nonprofit corporation by applicable laws (including regulations) of
the State where the Center is incorporated, except that the Center shall
not own or operate any tobacco-related interest.
(1) IN GENERAL- Not later
than May 15 of each year, the Center shall submit an annual report for
the preceding fiscal year ending September 30 to the President for transmittal
to Congress.
(2) CONTENTS- The report
shall include--
(A) a comprehensive and
detailed report of the operations, activities, financial condition, and
accomplishments of the Center under this section and such recommendations
as the Center considers appropriate; and
(B) a listing of each organization
that receives a grant from the Center and the purpose and amount of each
grant.
(3) CONGRESSIONAL TESTIMONY-
An officer or employee of the Center shall be available to testify before
an appropriate committee of Congress with respect to--
(A) the report required
under paragraph (1);
(B) the report of any audit
made by the Comptroller General of the United States pursuant to this section;
or
(C) any other matter that
the committee may determine.
(h) FINANCIAL MANAGEMENT
AND RECORDS-
(1) INDEPENDENT ANNUAL AUDITS-
(A) IN GENERAL- The accounts
of the Center shall be audited annually in accordance with generally accepted
auditing standards by 1 or more independent certified public accountants
or independent licensed public accountants certified or licensed by a regulatory
authority of a State or political subdivision of a State.
(B) LOCATION- The audit
shall be conducted at the 1 or more places where the accounts of the Center
are normally kept.
(C) INFORMATION AND FACILITIES-
The 1 or more persons conducting the audit shall--
(i) have access to all books,
accounts, records, reports, files, and other papers, things, or property
belonging to or in use by the Center and necessary to facilitate the audit,
which shall remain in the possession and custody of the Center; and
(ii) be provided full facilities
for verifying transactions with the balances or securities held by depositories,
fiscal agents, and custodians.
(D) ANNUAL REPORT- The report
of each independent audit conducted under this paragraph shall be included
in the annual report required by subsection (g)(1).
(E) CONTENTS- The audit
report shall--
(i) provide a description
of the scope of the audit;
(ii) include such statements
as are necessary to analyze the assets and liabilities (including any surplus
or deficit) of the Center, with an analysis of the changes in the assets,
liabilities, and expenses during the applicable year; and
(iii) provide a statement
of the sources and application of funds, together with the opinion of the
independent auditor of the statement.
(2) AUDITS BY GENERAL ACCOUNTING
OFFICE-
(A) IN GENERAL- The financial
transactions of the Center for any fiscal year during which Federal funds
are available to finance any portion of the operations of the Center may
be audited by the General Accounting Office in accordance with the principles
and procedures applicable to commercial corporate transactions and under
such rules and regulations as may be
prescribed by the Comptroller
General of the United States.
(B) LOCATION- The audit
shall be conducted at the 1 or more places where accounts of the Center
are normally kept.
(C) INFORMATION AND FACILITIES-
The representatives of the General Accounting Office conducting the audit
shall--
(i) have access to all books,
accounts, records, reports, files, and other papers, things, or property
belonging to or in use by the Center and necessary to facilitate the audit,
which shall remain in the possession and custody of the Center; and
(ii) be provided full facilities
for verifying transactions with the balances or securities held by depositories,
fiscal agents, and custodians.
(i) IN GENERAL- A report
of each audit conducted under this paragraph shall be made by the Comptroller
General to Congress.
(ii) CONTENTS- The report
shall contain--
(I) such comments and information
as the Comptroller General determines necessary to inform Congress of the
financial operations and condition of the Center;
(II) such recommendations
with respect to the operations and condition as the Comptroller General
may consider advisable; and
(III) a description of any
program, expenditure, or other financial transaction or undertaking observed
in the course of the audit, that, in the opinion of the Comptroller General,
has been carried on or made without authority of law.
(iii) COPIES- At the time
the report is submitted to Congress, a copy of the report shall be furnished
to the President, the Secretary, and the Center.
(A) IN GENERAL- Not later
than 1 year after the date of enactment of this section, in consultation
with the Comptroller General and other appropriate persons, the Center
shall develop accounting principles that shall be used uniformly by all
individuals and entities receiving funds under this section, taking into
account organizational differences among various categories of the individuals
and entities.
(B) SCOPE- The principles
shall cover all funds received and expended by the individuals or entities
under this section.
(C) REQUIREMENTS- Each individual
and entity receiving funds under this section shall be required--
(i) to keep its books, records,
and accounts in such form as may be required by the Center;
(ii)(I) to undergo a biennial
audit by independent certified public accountants or independent licensed
public accountants certified or licensed by a regulatory authority of a
State, which audit shall be in accordance with auditing standards developed
by the Center; or
(II) to submit a financial
statement in lieu of the audit required by subclause (I) if the Center
determines that the cost of the audit imposed on the individual or entity
is excessive in light of the financial condition of the individual or entity;
and
(iii) to furnish biennially
to the Center--
(I) a copy of the audit
report required under clause (ii); and
(II) such other information
regarding finances (including an annual financial report) as the Center
may require.
(D) MAINTENANCE OF RECORDS
BY RECIPIENTS- Any recipient of assistance by grant under this section
shall keep--
(i) such records as may
be reasonably necessary to disclose fully--
(I) the amount and the disposition
by the recipient of the assistance;
(II) the total cost of the
project or undertaking in connection with which the assistance is given
or used; and
(III) the amount and nature
of that portion of the cost of the project or undertaking supplied by other
sources; and
(ii) such other records
as will facilitate an effective audit.
(E) ACCESS TO RECIPIENT
RECORDS-
(i) CENTER- The Center (including
an authorized representative) shall have access to any books, documents,
papers, and records of any recipient of assistance for the purpose of auditing
and examining all funds received or expended by the recipient under this
section.
(ii) COMPTROLLER GENERAL-
The Comptroller General of the United States (including an authorized representative)
shall have access to such books, documents, papers, and records for the
purpose of auditing and examining all funds received or expended under
this section during any fiscal year for which Federal funds are available
to the Center.
(A) IN GENERAL- The Center
shall maintain the information described in subparagraphs (C), (D), and
(E) of paragraph (3) at the offices of the Center for public inspection
and
copying for at least 3 years,
according to such reasonable guidelines as the Center may issue.
(B) UPDATES- The Center
shall regularly update the information.
(C) APPLICABILITY- This
paragraph shall apply to all assistance provided under this section after
the date of enactment of this Act. |