For other versions of this document, see http://wikileaks.org/wiki/CRS-RL31581 ------------------------------------------------------------------------------ Order Code RL31581 CRS Report for Congress Received through the CRS Web Trade Title of the 2002 Farm Bill: Comparison of Final Provisions with the House and Senate Proposals, and Prior Law September 27, 2002 Geoffrey S. Becker Specialist in Agricultural Policy Resources, Science, and Industry Division Congressional Research Service ~ The Library of Congress Trade Title of the 2002 Farm Bill: Comparison of Final Provisions with the House and Senate Proposals, and Prior Law Summary Exports, whether commercial or provided as food aid, are viewed by most U.S. agricultural groups as critical to their prosperity. Thus, the trade and food aid provisions of the omnibus farm bill, the Farm Security and Rural Investment Act of 2002 (H.R. 2646), signed into law (P.L. 107-171) by the President on May 13, 2002, are of great interest to the agricultural community. The measure includes a trade title (Title III) amending and/or extending, through 2007, the major agricultural export and foreign food aid programs. These include direct export subsidies (the Export Enhancement Program and Dairy Export Incentive Program); market promotion programs (the Market Access Program and Foreign Market Development Cooperator Program); food aid (for example, P.L. 480, the Food for Peace Program; and Food for Progress); and export credit guarantees (the so-called GSM-102 and GSM-103 programs). The law also contains (in Title X) provisions setting new country-of-origin labeling requirements for meat, seafood, peanuts, and fruits and vegetables. Title I, the commodity title, significantly expands the availability of domestic U.S. farm subsidies. Both have implications for U.S. trade relations, particularly as the United States currently is negotiating new agricultural trade rules in the World Trade Organization. Stated U.S. goals are the elimination of all countries' export subsidies, as well as substantial reductions in domestic farm support and import restrictions. This report, which is not intended for future updates, provides a side-by-side comparison of the new law's major trade provisions with prior law, and with the differing farm bills passed earlier in the 107th Congress by the House and Senate. Contents Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Selected Policy Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Projected Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Comparison of Provisions: Prior Law, House and Senate Bills, New Law . . . . . . 4 Agricultural Export Assistance Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Market Access Program (MAP) Foreign Market Development Cooperator Program Export Enhancement Program Dairy Export Incentive Program Export Credit Guarantees (GSM) Emerging Markets Program Food Aid Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 P.L. 480 (Food for Peace) General P.L.480 Assistance Levels and Funding P.L. 480 Operation & Administration Certified Institutional Partners Farmer-to-Farmer Program CCC (Section 416) Surplus Donations Bill Emerson Humanitarian Trust Food for Progress International Food for Education Farmers for Africa & Caribbean Basin Terrorism and Foreign Assistance Other Trade Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Trade Agreement Compliance Technical Assistance for Barriers to Trade Biotechnology and Agricultural Trade Program Trade Negotiating Objectives Exporter Assistance Initiative Cuba Trade Sanctions Studies and Reports Country of Origin Labeling; Grading Trade Title of the 2002 Farm Bill: Comparison of Final Provisions with the House and Senate Proposals, and Prior Law Introduction1 With agricultural exports accounting for about one-fourth of U.S. farm income, policymakers view efforts to develop and maintain overseas markets as vital to the sector's financial health. The Administration and Congress, primarily through its Agriculture Committees, attempt to promote U.S. exports through an array of domestic farm programs, agricultural export subsidy and promotion activities, and foreign food aid programs. Most of these programs are periodically reviewed, amended, and reauthorized as part of an omnibus, multi-year farm bill. A new farm bill, the Farm Security and Rural Investment Act of 2002 (H.R. 2646), was cleared by Congress in early May. The President signed the measure into law (P.L. 107-171) on May 13, 2002. The measure includes a trade title (Title III) amending and/or extending, through 2007, the major foreign food aid and agricultural export programs. These include direct export subsidies [the Export Enhancement Program (EEP) and Dairy Export Incentive Program (DEIP)]; market promotion programs [the Market Access Program (MAP) and Foreign Market Development Cooperator Program (FMDP)]; food aid (for example, P.L. 480, the Food for Peace Program; and Food for Progress); and export credit guarantees (the so-called GSM-102 and GSM-103 programs). Also, Title X of the law sets out new country-of-origin labeling requirements for meat, seafood, peanuts, and fruits and vegetables. Title I, the commodity title, significantly expands the availability of domestic U.S. farm subsidies. Both have implications for U.S. trade relations, particularly as the United States currently is negotiating new agricultural trade rules in the World Trade Organization (WTO). 1 A primary source for this report is the conference report (H.Rept. 107-424) to accompany H.R. 2646, the Farm Security and Rural Investment Act of 2002. For a lengthier discussion of U.S. agricultural export and food aid programs, including data on recent spending levels, how the programs are funded in the federal budget, and current issues, see CRS Issue Brief IB98006, Agricultural Export and Food Aid Programs, updated periodically. For details on the entire farm law, including projected costs and other information, see CRS Report RL31195, The 2002 Farm Bill: Overview and Status. CRS-2 Selected Policy Issues Some critics believe that the availability of expanded farm support under the commodity title increases the possibility that the United States will exceed its subsidy limits ($19.1 billion per year in trade-distorting subsidies) set forth in the multilateral 1994 Uruguay Round Agreement on Agriculture (URAA). To allay such concerns, the bill's drafters included, in Title I, a requirement that the Secretary of Agriculture, to the maximum extent practicable, make adjustments in domestic farm support to ensure that subsidies do not exceed the limits. Some have questioned the feasibility of implementing this provision -- the so-called "circuit breaker" -- and how it could be applied equitably among programs and producers. Also, the expansion of domestic farm support has caused some critics here and abroad to question the sincerity of the U.S. proposal, in the current global trade negotiations, to further reduce all countries' trade-distorting farm policies. Defenders counter that the United States has remained within its URAA limits and is not likely to exceed them in the future, and, furthermore, that so long as the European Union and others heavily subsidize their farmers, the United States should not unilaterally cut back on aid. (See CRS Report RL30612, Farm Support Programs and World Trade Commitments.) In renewing the food aid and export assistance programs, the 107th Congress again was confronted with questions of policy direction and funding. Levels of spending and volumes of product subsidized under EEP and DEIP are subject to limitations under the multilateral 1994 Uruguay Round Agreement on Agriculture (URAA). In practice, EEP has been used little in recent years; DEIP has been used to the limits of the URAA. Market promotion programs like MAP, the food aid programs, and export credits (GSM) are not considered to be trade distorting under the current URAA, and therefore are not subject to spending disciplines. However, foreign trading partners argue that the United States has utilized food aid and export credits as ways to dispose of heavily subsidized farm surpluses, thereby distorting trade -- and want such programs to be disciplined in the new round of negotiations. (The United States says it is willing to discuss export credits during the negotiations.) Some have questioned whether export subsidy and promotion activities actually increase overseas sales or simply displace commercial sales. Even if sales increase, do they translate into higher farm prices and incomes -- or might direct farm subsidies be more cost-effective? Some critics claim that these programs benefit primarily large food and export companies (who can afford to pay for promotion activities themselves) or foreign buyers more than U.S. producers. Defenders cite studies claiming positive outcomes from such spending. Similar questions arise with regard to foreign food aid. CRS-3 Projected Costs The Congressional Budget Office (CBO) in March 2002 projected that under the trade title of the new farm bill, mandatory spending over six years (FY2002-2007) would increase by $532 million (new budget authority) over the baseline of $1.572 billion, for total mandatory spending of $2.104 billion. Actual spending is expected to be higher, because some programs are so-called discretionary programs, meaning that their funding is determined through annual appropriations. Most notably, P.L. 480 food aid receives more than $1 billion in annual appropriations. CRS-4 Comparison of Provisions: Prior Law, House and Senate Bills, New Law PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 A. Agricultural Export Assistance Programs 1. Market Access Program (MAP) a. MAP helps exporters (mainly a. Extends current law, except it a. Extends current law, except that a. Extends current law through nonprofit industry trade associations, increases mandatory funding to not in addition to any funds specifically FY2007 at the following mandatory who allocate the funds to others more than $200 million yearly in CCC appropriated for the program, funding levels: $100 million in including agricultural cooperatives funds through FY2011. [§301] mandatory funding of not more than FY2002; $110 for FY2003; $125 and small businesses) finance $100 million in FY2002; $120 million for FY2004; $140 million for promotional activities overseas million in FY2003; $140 million in FY2005; $200 million for FY2006; (usually for more consumer-oriented, FY2004; $180 million in FY2005; $200 million for FY2007. [§3103] higher value products). Required in $200 million in FY2006 (in CCC (mandatory) funding of not more than funds or equivalent CCC $90 million yearly in CCC funds commodities). [§322] through FY2002. [Agricultural Trade Act of 1978 as amended by §244 of Federal Agriculture Improvement and Reform (FAIR) Act of 1996] b. No provision. b. No provision. b. Priority, for funds in excess of b. In providing funds in excess of $90 million in any year, for eligible the FY2001 level (i.e., $90 million) organizations that have not Secretary shall, for proposals from participated in the past, and for new program participants and for programs in emerging markets. emerging markets, give [Section 322] consideration equal to that given to current participants. [§3103] c. No provision. c. No provision. c. New U.S. Quality Export c. No provision. Initiative (using appropriated MAP, FMDP funds), to promote U.S. products with a new "U.S. Quality" seal overseas. [Section 322] CRS-5 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 2. Foreign Market Development Cooperator Program (FMDP) a. FMDP helps U.S. exporters a. Extends current law, except sets a. Extends current law, except sets a. Extends current law, except sets (mainly through commodity based mandatory funding at $37 million in mandatory funding of $37.5 million mandatory funding at $34.5 million trade associations) to finance CCC funds yearly through FY2011. for FY2002; $40 million for annually from FY2002 to FY2007. promotional activities overseas. [§305] FY2003; and $42.5 million for [§3105] Statutory authority (at such sums as FY2004 and subsequent years (in necessary) through FY2002; current CCC funds or equivalent CCC funding is $28 million per year. commodities). [§324] [Agricultural Trade Act of 1978 as amended by §252 of FAIR Act of 1996] b. FMDP has focused on promoting b. New emphasis on exporting value- b. Establishes a priority, for funds b. In providing funds in excess of mainly bulk and partially processed added products to emerging markets. above $35 million in any year, for the FY2001 level (i.e., $28 million) commodities, targeted to foreign Requires annual report to Congress on eligible organizations that have not the Secretary shall, for proposals importers/processors -- although program. [§305] participated in the past, and for from new program participants and about a third of program promotes programs in emerging markets. for emerging markets, give value-added products. [§324] consideration equal to that given to current participants. Calls for "a continued significant emphasis" on value-added products to emerging markets. Requires annual report to Congress. [§3105] 3. Export Enhancement Program (EEP) a. EEP authorizes cash payments or a. Current law extended through a. Current law extended through a. Current law extended through CCC commodities as bonus subsidies FY2011, at current level of up to $478 FY2006, at current level of up to FY2007 at current level of up to to help exporters sell agricultural million per year. [§304] $478 million per year. [§323] $478 million per year. [§3104] products (although not statutorily prescriptive, mainly wheat and other grains have used EEP) at more competitive prices in targeted foreign markets. Authority through FY2002, with CCC funding at up to $478 CRS-6 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 million per year. [Agricultural Trade Act of 1978 as amended by §245 of FAIR Act of 1996] b. EEP may be used to help mitigate b. No expanded definition. b. Expands the definition of unfair b. Expands definition of unfair trade or offset the effects of unfair trade trade practices to include (1) pricing practices to include (1) an exporting practices, now defined as any foreign practices by an exporting state STE that prices its commodities act or policy that "violates, or is trading enterprise (STE) that "are inconsistently with sound inconsistent with, the provisions of, not consistent with sound commercial practice; (2) provision or otherwise denies benefits to the commercial practices conducted in of subsidies that decrease U.S. United States under, any trade the ordinary course of trade," or (2) export market opportunities or agreement..." or "is unjustifiable, changing U.S. "export terms of unfairly distort market opportunities unreasonable, or discriminatory and trade through a deliberate change in to detriment of U.S. exporters; (3) burdens or restricts United States the dollar exchange rate of a unfair technical barriers to trade commerce." [Agricultural Trade Act competing exporter." [§323] including commercial requirements of 1978, §102] adversely affecting new technology like biotechnology and unjustified sanitary or phytosanitary restrictions; (4) unfair implementation of tariff rate quota rules; (5) failure to meet trade agreement obligations with the United States. [§3104] 4. Dairy Export Incentive Program (DEIP) DEIP authorizes cash or CCC Extends current law through 2011. Extends current law through Extends current law through 2007. commodities as bonus subsidies to [Title I-C, §143] FY2006. [Title I-C, §133] [Title I- E, §1503] help exporters sell specified dairy products at more competitive prices in targeted foreign markets. Authority through FY2002, with CCC funding to provide commodities to the maximum levels consistent with U.S. obligations as a member of the World Trade Organization. [Food Security Act of 1985 as amended by §148 of the FAIR Act of 1996] CRS-7 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 5. Export Credit Guarantees (GSM) a. Extends current law through a. Extends current law through a. Extends current law through a. Authority through FY2002 with FY2011. [§306] FY2006. Requires a report to FY2007. Instead of report, requires CCC funding, where USDA Congress within 1 year on the status regular consultations with Congress guarantees commercial financing of of multilateral negotiations on the status of multilateral not less than $5.5 billion annually of regarding agricultural export credit negotiations regarding agricultural U.S. agricultural exports. Financing programs. [§321] export credit programs. [§3102] can be used for short-term credit (GSM-102) for up to 3 years; and for long-term credit (GSM-103), for 3-10 years. GSM programs are used in countries where needed financing may not be available without the CCC guarantees. (At least 35% of total credit guarantees must be to promote processed or high-value agricultural products.) [Agricultural Trade Act of 1978 as amended by the §243 of the FAIR Act of 1996] b. Supplier Credits feature permits b. No change in supplier credit term. b. Permits guarantees of supplier b. Permits supplier credit guarantees CCC to issue credit guarantees for credits for up to 12 months. [§321] for up to 360 days, subject to repayment of credit made available appropriations for any loan terms by a U.S. exporter to a foreign buyer longer than the current 180 days. for up to 180 days. [Agricultural [§3102] Trade Act of 1978 as amended by §243 of the FAIR Act] 6. Emerging Markets Program a. Requires CCC through FY2002 to a. Extends current law through a. Extends current law through a. Extends current law through offer no less than $1 billion per year FY2011. [§308] FY2006. [§332] FY2007. [§3203] in direct credit, or credit guarantees, for exports to emerging markets (formerly emerging democracies). [Food, Agriculture, Conservation and Trade Act of 1990 as amended by §277 of the FAIR Act of 1996] CRS-8 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 b. Increases this funding to $13 b. No increase. b. No increase. b. Requires CCC to provide $10 million annually. [§308] million annually through FY2002 to send U.S. advisors to emerging markets. Food, Agriculture, Conservation and Trade Act of 1990 as amended by §277 of FAIR Act of 1996] B. Food Aid Programs 1. P.L. 480 (Food for Peace) General a. Seeks to combat hunger and a. Extends P.L. 480 (i.e., authority to a. Extends P.L. 480 through a. Extends P.L. 480 authority encourage development overseas. enter into new agreements) through FY2006. [§311] through FY2007. [§3012] Title I makes export credit available FY2011. [§307] on concessional terms (e.g. low interest rates for up to 30 years); Title II authorizes donations for emergency food aid and non-emergency humanitarian assistance. Authority to enter into new P.L. 480 agreements (which are funded mainly through annual appropriations) is through FY2002. [§408 of P.L. 480 (Agricultural Trade Development and Assistance Act of 1954) as amended by §217 of the FAIR Act of 1996] b. Congress has stated five specific b. Adds "conflict prevention" as a b. Adds "conflict prevention" as a b. Adds "prevent conflicts" as a new purposes of P.L. 480 (e.g. combat new purpose. [§307] new purpose. [§301] purpose. [§3001] hunger, expand international trade, etc.). [§2 of P.L. 480] c. Food Aid Consultative group c. Extends Food Aid Consultative c. Extends Food Aid Consultative c. Extends Food Aid Consultative consisting of specified federal Group through FY2006; clarifies what Group through FY2006. [§305] Group through FY2007. [§3005] CRS-9 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 officials, representatives of private the group is to review to include voluntary organizations (PVOs), policies and guidelines. [§307] foreign non-government organizations, and agriculture producer groups, is authorized through FY2002. [§205 of P.L. 480] 2. P.L.480 Assistance Levels and Funding a. Minimum Title II assistance is a. Increases the minimum level of a. Increases the minimum level of 2.025 million metric tons (MMT) of a. Increases the minimum level of commodities to 2.1 MMT in commodities to 2.5MMT annually agricultural commodities per year commodities to 2.25MMT per year FY2002, 2.2MMT in FY2003, 2.3 beginning in FY2002. Changes the through FY2002; AID Administrator through FY2011. [§307] MMT in FY2004, 2.4 MMT in sub-minimum requirement for non- has some authority to waive FY2005, and 2.5 MMT in FY2006. emergency programs to 1.875 MMT minimum. Subminimum requirement [§304] annually. [§3004] for non-emergency programs is 1.55MMT. [§204 of P.L. 480] b. Limits CCC Title II costs to $1 b. Doubles limit on CCC Title II b. Removes limit on CCC Title II billion yearly; some Presidential b. Removes limit on CCC Title II costs to $2 billion per year. [§306] costs. [§3006] waiver authority. [§206 of P.L. 480] costs. [§307] c. Provides that at least $10 million c. Replaces dollar designations by c. Replaces dollar designations by but not more than $28 million of Title c. Replaces dollar designations by setting support for eligible setting support for eligible II funding per year shall be use to setting support for eligible organizations at not less than 5% organizations at not less than 5% and support eligible organizations (PVOs, organizations at not less than 5% and and not more than 10% of Title II not more than 10% of Title II cooperatives, organizations like the not more then 10% of Title II funding. funding. [§302] funding. [§3002] World Food Program, etc.) in [§307] conducting Title II activities. [§202 of P.L. 480] 3. P.L. 480 Operation & Administration a. Permits PVOs to sell Title II a. Authorizes the use of U.S. dollars a. Similar to House [§303, §310, & a. Monetization language similar to commodities in the recipient country and other currencies for monetization §325]. Also, a food aid commodity House and Senate. Adopts Senate's (or a nearby country) to finance in P.L. 480 -- and also Food for sale is to be "at a reasonable market "reasonable market price" language. CRS-10 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 commodity transportation, storage, Progress and Section 416 programs; price in the economy" where the Contains language encouraging etc., and local development projects permits PVOs to submit multi-country commodity is to be sold. [§310] multi-country proposals, from all ("monetization"). [§203 of P.L. 480] proposals; and permits food aid eligible organizations, not just monetization in more than one country PVOs. [§3003; §3009; §3106] in the region. [§302; §303; §307] b. The AID Administrator has 45 b. Increases the time for decisions b. Increases, to 120 days, time the b. Increases, to 120 days, time the days to decide on Title II proposals from 45 to 120 days. [§307] Administrator has to decide on Title Administrator has to decide on Title submitted by eligible organizations or II proposals. Contains other II proposals; clarifies that the period U.S. field missions. [§207 of P.L. timelines for finalizing program begins after submission of the 480] agreements and announcing proposal to AID Administrator, who programs each year. Permits is encouraged to make decisions on USDA to approve an agreement that proposals within that period. Deletes provides for direct delivery of Senate provision on direct delivery commodities to foreign milling or of commodities. [§3007] processing facilities that are more than 50% U.S.-owned, with cash proceeds transferred to eligible organizations for carrying out projects. [§307] c. Authorizes $2 million in each of c. Extends authorization through c. Extends authorization through c. Extends authorization through FY2001 and FY2002 to "preposition" FY2011. [§307] FY2006. [§311] FY2007. [§3010] food aid commodities in the U.S. and foreign countries. [§407 of P.L. 480] d. Authorizes appropriations of up to d. Extends authorization through d. Extends authorization through d. Extends authorization through $3 million annually through FY2002 FY2011. [§307] FY2006. [§308] FY2007. [§3008] for grants to PVOs and U.S. non- profits for stockpiling shelf-stable, pre-packaged foods. [§208 of P.L. 480] e. Requires USDA (if feasible) to e. No provision. e. Extends the authorization as an e. Adopts the Senate provision establish a "micronutrient ongoing program through FY2006. through FY2007 with technical CRS-11 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 fortification" pilot program; authority [§313] corrections; includes language aimed expires in FY2002. [§415 of P.L. at improving and insuring quality of 480] fortified food aid commodities. [§3013] f. No provision. f. No provision. f. Permits President to establish, f. As part of required report to under Title II, a "pilot emergency Congress within 120 days on use of relief program to provide live lamb perishable commodities, Agriculture to Afghanistan." [§309.] Secretary must report on feasibility of transporting lambs and other live animals in food aid programs. [§3207] 4. Certified Institutional Partners No provision in current law. No provision. Requires AID or USDA, as For Title II Food for Peace, AID Currently PVOs and cooperatives applicable, to establish a process Administrator must establish, within generally must undergo the same enabling PVOs and cooperatives 1 year, streamlined guidelines and application procedures to participate that can demonstrate their capacity application procedures and, by in various food aid programs each to carry out the programs (under FY2004, incorporate, to the time they apply. P.L. 480; §416; or Food for maximum extent practicable, the Progress) to qualify as "certified changes. Requires consultation with institutional partners," which would stakeholders and Congress, and a entitle them to use streamlined report to Congress within 270 days application procedures, including on improvements. [§3002]. For expedited review and approval to Food for Progress and Section 416, receive commodities for use in requires, respectively, the President more than one country. [§302; and Secretary of Agriculture, within §325; §334] 270 days, to review and make any needed changes in rules and procedures aimed at streamlining application procedures, including consideration of pre-screening organizations and proposals; requires consultations with Congress. [§3106; §3201]. CRS-12 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 5. Farmer-to-Farmer Program Requires that no less than 0.4% of Extends funding authority at current Extends funding authority through Extends funding authority through P.L. 480 funds be used to provide 0.4% through FY2011. [§307] FY2006, and increases minimum FY2007, and increases minimum U.S. farmers' and other agricultural funding to 0.5% of P.L. 480 funds. funding to 0.5% of P.L. 480 funds. experts' technical assistance in [§314] Farmers for Africa and Caribbean developing, middle income and Basin Program is incorporated into emerging market countries. [Title V of this title (see No. 10, page 14, for P.L. 480 as amended by §224 and details). [§3014] §277 of the FAIR Act of 1996] [Note: renames program "John Ogonowski Farmer-to-Farmer Program."] 6. CCC (Section 416) Surplus Donations Permanent law authorizes Maintains current law, and requires Maintains current law, and permits Adopts House language regarding the use of CCC-owned surplus USDA to publish in the Federal USDA to approve an agreement that October 31 and December 31 commodities for overseas donations. Register, by each October 31, an provides for direct delivery of deadlines. Omits Senate provision [§416(b) of the Agricultural Act of estimate of Section 416 commodities commodities to foreign milling or on direct delivery of commodities. 1949 as amended] to be made available for the fiscal processing facilities that are more [§3201] year. Also encourages Section 416 than 50% U.S.-owned, with cash program agreements to be finalized by proceeds transferred to eligible December 31. [§303] organizations for carrying out projects. [§334] 7. Bill Emerson Humanitarian Trust Authorizes, through FY2002, a trust Extends the Trust through FY2011. Extends the Trust through FY2006. Extends the Trust through FY2007. totaling not more than 4MMT of [§309] [§331] [§3202] wheat, rice, corn, sorghum, or any combination as a reserve solely to meet emergency humanitarian food needs. [Bill Emerson Humanitarian Trust Act of 1998, which replaced Title III of the Agricultural Act of 1980 as amended (Food Security Commodity Reserve)] CRS-13 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 8. Food for Progress (FFP) a. Provides commodities to support a. Reauthorizes FFP through FY2011. a. Reauthorizes FFP under a new a. Reauthorizes FFP through countries that have committed to [§302] Title VIII of the 1978 Agricultural FY2007 under existing law (i.e., not expand free enterprise in their Trade Act called "Food for Progress a new Title VII). Encourages agricultural economies; commodities and Education Programs," President to finalize agreements may be provided under Title I of P.L. authorized through FY2006. before beginning of relevant fiscal 480 or Section 416(b) authorities, or Permits USDA to provide year. Requires him to submit to using CCC funds. Authority expires agricultural commodities to support Congress by each December 1 a list December 31, 2002. [§1110 of the introduction or expansion of free of programs, countries, eligible Food Security Act of 1985 as trade enterprises in recipient commodities, and transportation and amended by the FAIR Act of 1996] country economies, and to provide administrative costs for the year. food or nutrition assistance. [§325] Defines eligible commodities. Incorporates a definition section into the statute; establishes program purposes and quality assurance requirements; and requires President to ensure that eligible organizations are optimizing use of donated commodities. [§3106] b. Annual limits on CCC funds for b. Increases annual limits on b. Permits up to $55 million per b. Increases annual limits on administrative costs and for administrative costs to $15 million, year to be used for transportation, administrative costs to $15 million, commodity transportation costs are and on transportation costs to $40 administrative, processing, and and on transportation costs to $40 $10 million and $30 million, million. [§302] related costs. [§325] million. [§3106] respectively. c. Annual limit on commodity c. Increases annual limit on c. Sets an annual minimum tonnage c. Annual minimum tonnage assistance is 500,000MT. commodities to 1 million MT. Also, requirement for FFP of 400,000MT requirement: "not less than excludes from the tonnage limit those through FY2006, using the CCC. 400,000MT may be provided" commodities furnished on a grant basis In addition, authorizes the through CCC. Excludes, from the or on credit terms under Title I. [§302] appropriation of such sums as may current annual tonnage limits, those be necessary to carry out FFP, plus commodities furnished on a grant permits the use of P.L. 480 Title I basis or on credit terms under P.L. funds. All commodities and related 480, Title I. [§3106] expenses must be in addition to any other P.L. 480 assistance. [§325] CRS-14 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 9. International Food for Education School feeding and child nutrition Authorizes George McGovern-Robert Requires establishment of an Permits President to establish the projects have been operated within Dole International Food for Education International Food for Education McGovern-Dole International Food broader PVO and United Nations and Child Nutrition Program whereby and Nutrition Program whereby the for Education and Child Nutrition World Food Program (WFP) food aid the President is permitted to direct the Secretary of Agriculture may Program, with mandatory funding portfolios. Clinton Administration provision of U.S. agricultural provide commodities and technical from CCC of $100 million in initiated a pilot global food for commodities and financial and and nutrition assistance for FY2003 to continue existing pilot education initiative whereby USDA technical assistance for foreign programs that improve food projects; and subject to has committed to provide up to $300 preschool and school feeding programs security and enhance educational appropriations in FY2004-2007. million (under Section 416 authority) to reduce hunger and improve literacy opportunities for preschool and Eligible costs include commodity for commodities and transportation (particularly among girls), and primary school children in recipient acquisition, processing, costs for school and pre-school nutrition programs for pregnant and countries. CCC authority and funds transportation, handling (including nutrition projects and related nursing women and young children. of not more than $150 million shall specified in-country costs if activities in developing countries. Authorizes the appropriation of such be used in each of FY2002-2005. President makes certain Approved projects conducted through sums as may be necessary each year Eligible organizations include determinations). Eligible the WFP, PVOs, and eligible foreign through FY2011. Gives President PVOs, cooperatives, organizations: cooperatives, PVO's, governments using USDA authority to designate the federal nongovernmental organizations, intergovernmental organizations, discretionary authorities. [General agency to administer program; defines and foreign countries, which are governments of developing countries authority under Section 416] eligible recipients to include PVOs, subject to a "graduation and their agencies, and other cooperatives, intergovernmental requirement" to provide for organizations. Includes Senate organizations, governments and their continuation of program after end graduation requirement; program agencies, and other organizations. of funding. [§325] funding priorities and application [§312] guidelines; assurances that recipient country production and marketing are not disrupted. [§3107] 10. Farmers for Africa & Caribbean Basin No provision in current law. Creates a Farmers for Africa and No provision. House provision is incorporated into Caribbean Basin Program offering the John Ogonowski Farmer-to- grants to eligible organizations for Farmer Program, with authorization bilateral exchange programs utilizing for appropriations of up to $10 African-American and other U.S. million annually through FY2007. farmers and agricultural specialists. Up to 5% of appropriation can be Authorizes $10 million in annual used for administrative expenses. CRS-15 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 appropriations annually through [§3014] FY2011. [§311] 11. Terrorism and Foreign Assistance No provision. No provision. Sense of Senate that U.S. foreign Sense of Congress that U.S. foreign aid should play increased role in aid should play increased role in addressing conditions breeding addressing conditions breeding global terrorism. [§338] global terrorism. [§3209] C. Other Trade Provisions 1. Trade Agreement Compliance Under the 1994 Uruguay Round If the Secretary of Agriculture Same as House bill, but with If Secretary determines that Agreement on Agriculture (URAA) determines that total spending for such additional language requiring expenditures will exceed URAA the United States agreed to limit the commodity support will exceed the annual notifications to Congress on allowable levels for any applicable value of trade-distorting U.S. limits in the URAA, the Secretary may current and following marketing reporting period, Secretary shall, to domestic farm supports to $19.1 make adjustments in the programs to year estimates of support to be the maximum extent practicable, billion per year. However, U.S. law reduce spending to (but not below) reported to the World Trade make adjustments in such itself does not place an upper limit on such limits. [§181] Organization, and effectively expenditures to ensure that they do such supports. requiring Congress to consider not exceed allowable levels. Prior to amending (within 18 months) any doing so, Congress must be notified programs that might cause the of the adjustment types and levels. URAA limits to be breached. [Title I, §1601] [§164] 2. Technical Assistance for Barriers to Trade Various trade agreements discipline Requires USDA to establish a A section within the Biotechnology Requires USDA to establish, outside countries' use of sanitary and "Technical Assistance for Speciality and Agricultural Trade Program of the Biotechnology and phytosanitary (SPS) and other Crops" program, providing direct (see below) directs USDA to assist Agricultural Trade Program (see technical barriers to trade, used by assistance through public and private U.S. exporters harmed by below), a "Technical Assistance for countries to protect their consumers, projects and technical assistance, to "unwarranted and arbitrary" Specialty Crops" program providing agricultural and natural resources. help overcome the "unique barriers" barriers to trade due to marketing of direct assistance through public and USDA agencies, the U.S. Trade -- such as SPS and related barriers -- biotechnology products, food private projects and technical Representative, and other federal inhibiting exports of U.S. specialty safety, disease, or other SPS assistance to remove, resolve, or authorities have established crops (e.g., fruits, vegetables). concerns; authorizes appropriations mitigate SPS and related barriers to CRS-16 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 mechanisms for identifying such Requires use of $3 million annually in of $1 million annually through exports of U.S. specialty crops. barriers and attempting to resolve CCC funds through FY2011. [§310] FY2006. [§333] Requires use of $2 million annually disputes over them. in CCC resources through FY2007. [§3205] 3. Biotechnology and Agricultural Trade Program No provision. No provision. Requires USDA to establish a Establishes a Biotechnology and Biotechnology and Agricultural Agricultural Trade Program, using Trade Program to address the technical assistance and public and market access, regulatory, and private sector project grants, to marketing issues related to exports remove, resolve, or mitigate of U.S. agricultural biotechnology significant regulatory nontariff products. Requires CCC to make barriers to U.S. exports involving: available $15 million for the agricultural commodities produced program annually through FY2006. through biotechnology; food safety; [§333] disease; or other SPS concerns. Authorizes appropriations of $6 million annually through FY2007. [§3204] 4. Trade Negotiating Objectives Multilateral negotiations are under No provision. Sense of Congress provision also Contains an explicit description of way to reform further the terms of contains an explicit description of agricultural trade negotiating agricultural trade in place under the agricultural trade negotiating objectives, but as a Sense of Senate 1994 Uruguay Round Agreement on objectives. [§336] rather than Sense of Congress. Agriculture. Present trade law [§3210] contains a list of explicit U.S. objectives and consultation requirements for agriculture that U.S. negotiators are supposed to follow. [Trade Act of 2002, Title XXI] 5. Exporter Assistance Initiative Various federal agencies routinely No provision. Authorizes appropriations ($1 Requires Secretary to maintain a provide market intelligence, trade million for each of FY2002-2004 website with information to assist CRS-17 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 data, and other information aimed at and $500,000 for each of FY2005- U.S. agricultural exporters. No helping U.S. agricultural exporters 2006) for an "Exporter Assistance appropriations authorized. [§3101] find, understand, and sell into Initiative" to create an Internet [Note: extensive conference report overseas markets. For example, both website providing a single source of language directs Secretary to USDA's Economic Research Service information from all federal improve FAS web-based and Foreign Agricultural Service agencies to help U.S. agricultural information.] maintain written and web-based exporters. [§326] publications and data series containing much of this information. 6. Cuba Trade Sanctions FY2001 agriculture appropriations No provision. Lifts restrictions on private No provision. law codified the lifting of unilateral financing of agricultural sales to sanctions on commercial sales of Cuba [§335] food, agricultural commodities, medicine, and medical products to Iran, Libya, North Korea, and Sudan; and extended this policy to apply to Cuba, but in a more restrictive way by prohibiting all financing of such sales, even with private credit sources. [§908 of the Agriculture, Rural Development, Food and Drug Administration and Related Agencies Act, 2001] 7. Studies and Reports a. Services provided by USDA's a. Requires USDA to study and report a. No provision. a. Requires study, but only of fees Foreign Agricultural Service (FAS) to Congress within 1 year on the for services beyond those already are generally taxpayer-funded. feasibility of a program charging fees provided by FAS as part of an to pay for providing commercial overall market development strategy services abroad on matters under FAS. for a particular country or region. [§313] [§3208] b. Secretary of Agriculture is b. Requires USDA to report to b. No provision. b. Requires USDA to consult with required to develop a long-term Congress within 1 year on national relevant congressional committees CRS-18 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 agricultural trade strategy every 3 export strategy. [§314] on Global Market Strategy within years. Subsequent farm bills have 180 days of enactment and every 2 provided more explicit guidance on years after that. [§3206] trade strategy goals and procedures. [Agricultural Trade Act of 1978; Food, Agriculture, Conservation, and Trade Act of 1990; FAIR Act of 1996.] c. No provision. c. Requires USDA annual report to c. No provision. c. No provision. Congress on U.S. beef and pork imports each calendar year. [§946] d. No provision. d. No provision. d. Requires USDA to report to d. Requires USDA to report to Congress within 120 days on Congress within 120 days on transportation, infrastructure, and implications of storage and funding deficiencies that have transportation capacity and funding limited the use of perishable for use of perishable and semi- commodities in food aid programs. perishable commodities in food aid [§337] programs. [§3207] 8. Country of Origin Labeling; Grading a. Most imports, including many a. Requires retailers other than a. Requires retailers other than a. Requires retailers other than food items, must bear labels restaurants and other food service restaurants and other food service restaurants and other food service informing the final purchaser of their establishments to inform consumers of establishments to inform consumers establishments to inform consumers country of origin. However, certain the country of origin of "perishable of the country of origin of ground of the country of origin of ground "natural products" including fresh agricultural commodities" (fresh or and muscle cuts of beef, lamb and and muscle cuts of beef, lamb, and fruits, vegetables, nuts, live and dead fresh frozen fruits and vegetables) pork, of wild and farm-raised fish, pork, of farm-raised and wild fish, of animals (e.g., meats), and fish, among through labels, marks, or other in-store of perishable agricultural perishable agricultural commodities, others, generally are exempted. [§304 information; specifies the daily fines commodities, and of peanuts, and of peanuts, through labels, of the Tariff Act of 1930 as amended; for violations. [Title IX, §944] through labels, marks, or other in- marks, or other in-store information. Federal Meat Inspection Act and store information. Defines what is Defines what is meant by country of Poultry Products Inspection Act as meant by country of origin for each origin for each category (e.g., meats amended] of these categories; authorizes the must be from animals born, raised Secretary to set up a record-keeping and slaughtered in the United CRS-19 PRIOR LAW/POLICY HOUSE BILL (H.R. 2646) SENATE BILL (S. 1731 NEW LAW (P.L. 107-171) Through 2002 Covers 2002-2011 Amended) Covers 2002-2006 Covers 2002-2007 system; authorizes but does not States); includes language on specify fines for violations. [Title implementation and enforcement. X, §1001] Program is voluntary beginning September 30, 2002, and mandatory beginning September 30, 2004. [Title X, § 10816] b. USDA provides a fee-based b. No provision. b. Prohibits imported carcasses, b. No provision. service to the industry that grades meats, or meat food products from meats and meat products based on bearing a USDA quality grade their quality and affixes those grades label. [Title X, §1002] to such products; both domestic and imported meats are eligible. [Agricultural Marketing Act of 1946 as amended] ------------------------------------------------------------------------------ For other versions of this document, see http://wikileaks.org/wiki/CRS-RL31581