[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 124 Introduced in House (IH)]
110th CONGRESS
1st Session
H. R. 124
To require the prompt issuance by the Secretary of Agriculture of
regulations to restore integrity to the payment limitation requirements
applicable to commodity payments and benefits, to reduce waste, fraud,
and abuse related to the receipt of commodity payments and benefits,
and for other purposes.
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IN THE HOUSE OF REPRESENTATIVES
January 4, 2007
Mr. Fortenberry (for himself and Ms. Herseth) introduced the following
bill; which was referred to the Committee on Agriculture
_______________________________________________________________________
A BILL
To require the prompt issuance by the Secretary of Agriculture of
regulations to restore integrity to the payment limitation requirements
applicable to commodity payments and benefits, to reduce waste, fraud,
and abuse related to the receipt of commodity payments and benefits,
and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Farm Programs Payment Limitation
Integrity Act''.
SEC. 2. ISSUANCE OF REGULATIONS TO ESTABLISH MEASURABLE STANDARDS TO
PREVENT USE OF SEPARATE ENTITIES TO EXCEED PAYMENT
LIMITATIONS APPLICABLE TO COMMODITY PAYMENTS AND TO LIMIT
PAYMENTS TO ACTIVE FARMERS.
(a) Standards Regarding Active Personal Management and Evasion
Schemes and Devices.--The Secretary of Agriculture (in this section
referred to as the ``Secretary'') shall promulgate regulations to
establish measurable standards of--
(1) what constitutes a significant contribution of active
personal management with respect to a farm operation for
purposes of applying the payment limitations specified in
section 1001 of the Food Security of 1985 (7 U.S.C. 1308); and
(2) what constitutes a scheme or device to effectively
evade such payment limits or to evade section 1001A or 1001C of
such Act (7 U.S.C. 1308-1, 1308-3).
(b) Enforcement of Multiple Entity Limitations.--The Secretary
shall promulgate regulations to ensure that total payments and gains
described in section 1001 of the Food Security of 1985 made to or
through joint operations or multiple entities under the primary control
of a person, in combination with the payments and gains received
directly by the person, do not exceed twice the applicable dollar
amounts specified in subsections (b), (c), and (d) of such section.
(c) Attribution of Payments and Gains Derived From Certain Farming
Operations.--In the case of a person that in the aggregate owns,
conducts farming operations, or provides custom farming services on
land with respect to which the aggregate commodity payments exceed the
applicable dollar amounts specified in subsections (b), (c), and (d) of
section 1001 of the Food Security of 1985, the Secretary shall
promulgate regulations to ensure that all payments and gains made on
crops produced on the land are attributed as follows:
(1) To a person that rents land as lessee or lessor through
a crop share lease and receives a share of the payments that is
less than the usual and customary share of the crop received by
the lessee or lessor, as determined by the Secretary.
(2) To a person that provides custom farming services
through arrangements under which--
(A) all or part of the compensation for the
services is at risk;
(B) farm management services are provided by--
(i) the same person;
(ii) an immediate family member; or
(iii) an entity or individual that has a
business relationship that is not an arm's
length relationship, as determined by the
Secretary; or
(C) more than 2/3 of the farming operations are
conducted as custom farming services provided by--
(i) the same person;
(ii) an immediate family member; or
(iii) an entity or individual that has a
business relationship that is not an arm's
length relationship, as determined by the
Secretary.
(3) To a person under such other arrangements as the
Secretary determines are established to transfer payments from
persons that would otherwise exceed the applicable dollar
amounts specified in subsections (b), (c), and (d) of such
section.
(4) To the direct recipient of the commodity payments as
well as to the person to whom the payments are attributed under
paragraph (1), (2), or (3).
(d) Primary Control.--In the regulations required by this section,
the Secretary shall define ``primary control'' to include a joint
operation or multiple entity in which a person owns an interest that is
equal to or greater than the interest of any other one or more persons
that materially participate on a regular, substantial, and continuous
basis in the management of the operation or entity.
(e) Material Participation.--In the regulations required by this
section, the Secretary shall ensure that the standards for active
personal management require no less involvement than the standard for
materially participating on a regular, substantial, and continuous
basis in the management of the operation or entity as defined by
Treasury regulation section 1.469-5T(a)(1), as in effect on the date of
the enactment of this Act.
(f) Time for Issuance; Procedure.--The regulations required by this
section shall be issued in final form not later than 270 days after the
date of the enactment of this Act. To ensure compliance with this
deadline, the Secretary shall issue the regulations without regard to--
(1) the notice and comment provisions of section 553 of
title 5, United States Code;
(2) the Statement of Policy of the Secretary of Agriculture
effective July 24, 1971 (36 Fed. Reg. 13804), relating to
notices of proposed rulemaking and public participation in
rulemaking; and
(3) chapter 35 of title 44, United States Code (commonly
known as the Paperwork Reduction Act).
(g) Congressional Review of Agency Rulemaking.--In carrying out
this section, the Secretary shall use the authority provided under
section 808 of title 5, United States Code.
SEC. 3. PREVENTION OF SCHEMES OR DEVICES TO EVADE PAYMENT LIMITATIONS.
Section 1001B of the Food Security Act of 1985 (7 U.S.C. 1308-2) is
amended--
(1) by striking ``If'' and inserting ``(a) Basic Penalty
for Evasion of Payment Limitations.--Subject to subsection (b),
if''; and
(2) by adding at the end the following new subsection:
``(b) Effect of Fraud.--If the Secretary determines that a person
has committed fraud in connection with the adoption of a scheme or
device to evade, or that has the purpose of evading, section 1001,
1001A, or 1001C, the person shall be ineligible to receive farm program
payments (as described in subsections (b), (c), and (d) of section 1001
as being subject to limitation) applicable to the crop year for which
the scheme or device was adopted and the succeeding five crop years.''.
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