duction of such commodities (hereinafter referred to as the "reserve acreage"), and (c) shall not harvest any crop from, or graze, the reserve acreage unless the Secretary determines that it would be in the national interest to permit grazing and gives consent thereto. The reserve acreage shall be in addition to any acreage devoted to the conservation reserve program authorized under subtitle B of this Act. In the formulation and administration of the acreage reserve program the Secretary shall provide adequate safeguards to protect the interests of tenants and sharecroppers, including provision for sharing, on a fair and equitable basis, in the certificates issued pursuant to section 105 hereof. The acreage reserve program may include such terms and conditions, in addition to those specifically provided for herein, as the Secretary determines are desirable to effectuate the purposes of this Act and to facilitate the practical administration of the acreage reserve program.

EXTENT OF PARTICIPATION IN PROGRAM

SEC. 104. For the purposes of the acreage reserve program the Secretary shall establish a national reserve acreage goal for the 1956, 1957, 1958, and 1959 crops of wheat, cotton, corn, and rice, respectively, of not to exceed 30 per centum of the national acreage allotment established for such commodity under the Agricultural Adjustment Act of 1938, as amended. The limits within which individual farms may participate in the acreage reserve program shall be established in such manner as the Secretary determines is reasonably calculated to achieve the national reserve acreage goal and give producers a fair and equitable opportunity to participate in the acreage reserve program, taking into consideration their acreage allotments established under the Agricultural Adjustment Act of 1938, as amended, the supply and demand conditions for different classes, grades, and qualities of the commodity, and such other factors as he deems appropriate.

COMPENSATION OF PRODUCERS

SEC. 105. Producers shall be compensated for participating in the acreage reserve program through the issuance of negotiable certificates which the Commodity Credit Corporation shall redeem in the commodity or in cash in accordance with regulations prescribed by the Secretary. Such compensation shall be at such rate or rates as the Secretary determines will provide producers with a fair and reasonable return for reducing their acreage of the commodity, taking into consideration the loss of production of the commodity on the reserve acreage, any savings in cost which result from not planting the commodity on the reserve acreage, and the incentive necessary to achieve the reserve acreage goal. Commodities delivered to producers in redemption of such certificates shall not be eligible for tender to Commodity Credit Corporation under the price support program.

SALES OF CCC STOCKS

SEC. 106. The Commodity Credit Corporation is authorized to sell at market prices, without regard to sales price limitations which would otherwise be applicable, a quantity of the commodity equal in sales value to the cost of redeeming certificates in cash. Such sales shall be made at such times, in such manner and in such quantities as will minimize any adverse effect of such sales upon market prices.

REDUCTION OF SET-ASIDE

SEC. 107. The quantities of cotton and wheat in the commodity set-aside established pursuant to the Agricultural Act of 1954 shall be reduced by the estimated quantities of such commodities which would have been produced on the reserve acreage if such reserve acreage had been devoted to the production of such commodities.

EFFECT ON ACREAGE ALLOTMENTS AND QUOTAS

SEC. 108. (a) In the future establishment of State, county, and farm acreage allotments for wheat, cotton, corn, and rice, respectively, under the Agricultural Adjustment Act of 1938, as amended, reserve acreages applicable to the commodity shall be credited to the State, county, and farm as though such acreage had actually been devoted to the production of the commodity.

(b) In applying the provisions of paragraph (6) of Public Law 74, Seventyseventh Congress (7 U. S. C. 1340 (6)), and sections 326 (b) and 356 (g) of the Agricultural Adjustment Act of 1938, as amended (7 U. S. C. 1326 (b), 1356 (g)), relating to reduction of the storage amounts of wheat and rice, the reserve acreage of the commodity on any farm shall be regarded as wheat acreage or rice acreage, as the case may be, on the farm.

SUBTITLE B-CONSERVATION RESERVE PROGRAM

TERMS AND CONDITIONS

SEC. 109. (a) To effectuate the purposes of this Act the Secretary is hereby authorized to enter into contracts with producers determined by him to have control of the farms for the period covered by the contract wherein the producer shall agree:

(1) To establish and maintain for the contract period protective vegetative cover (including but not limited to grass and trees) or water storage facilities on a specifically designated acreage of cultivated cropland in the farm.

(2) To devote to conserving crops or uses, or allow to remain idle, throughout the contract period an acreage of the remaining land in the farm which is not less than the acreage normally devoted only to conserving crops or uses or normally allowed to remain idle on the entire farm.

(3) Not to harvest any crop from the acreage established in protective vegetative cover.

(4) Not to pasture the acreage established in protective vegetative cover prior to January 1, 1959, or such later date as may be provided in the contract, unless the Secretary determines that it would be in the national interest to permit pasturing thereon and gives consent thereto; and if such acreage is pastured at the end of such period, to pasture such acreage in accordance with sound pasture management.

(5) Not to adopt any practice, as specified by the Secretary in the contract, tending to defeat the purposes of the contract.

(6) To forfeit all rights to further payments or grants under the contract and refund to the United States all payments or grants received thereunder upon his violation of the contract at any stage during the time he has control of the farm if the Secretary determines that such violation is of such a nature as to warrant termination of the contract, or to make such refunds or accept such payment adjustments as the Secretary may deem appropriate if he determines that the producer's violation does not warrant termination of the contract.

(7) To such additional provisions as the Secretary determines are desirable and includes in the contract to effectuate the purposes of this Act and to facilitate the practical administration of the conservation reserve program.

(b) In return for such agreement by the producer the Secretary shall agree: (1) To bear such part of the cost (including labor) of establishing and maintaining vegetative cover or water storage facilities on the designated acreage as the Secretary determines to be necessary to effectuate the purposes of this Act, but not to exceed a maximum amount per acre or facility prescribed by the Secretary for the county or area in which the farm is situated; and

(2) To make an annual payment to the producer for the term of the contract upon determination that he has fulfilled the provisions of the contract entitling him to such payment. The rate or rates of the annual payment to be provided for in the contracts shall be established on such basis as the Secretary determines will provide producers with a fair and reasonable annual return on the land established in protective vegetative cover or water storage facilities, taking into consideration the value of the land for the production of commodities customarily grown on such kind of land in the county or area, the prevailing rates for cash rentals for similar land in the county or area, the incentive necessary to obtain contracts covering sufficient acreage for the substantial accomplishment of the purposes of the conservation reserve program, and such other factors as he deems appropriate. Such rate or rates may be determined on an individual farm basis, a county or area basis, or such other basis as the Secretary determines will facilitate the practical administration of the program. No annual payment to any person with respect to land in any one State shall exceed $5,000. (c) The Secretary, with the approval of the President, shall determine annually the scope of the program to be conducted under this subtitle B: Provided, That no action shall be taken pursuant to this subsection (c) which

64440-56-pt. 8-17

would cause impairment of any contract existing as of the time such annual determination is made.

AUTHORIZED PERIOD OF CONTRACTS AND EXPENDITURES

SEC. 110. (a) The Secretary is authorized to formulate and announce programs under this subtitle B and to enter into contracts thereunder with producers during the five-year period 1956-1960 to be carried out during the period ending not later than December 31, 1969.

(b) The period covered by any contract shall not exceed ten years.

SEC. 111. (a) The Secretary may terminate any contract with a producer by mutual agreement with the producer if the Secretary determines that such termination would be in the public interest.

(b) The Secretary may agree to such modification of contracts previously entered into as he may determine to be desirable to carry out the purposes of this Act and to facilitate the practical administration of the conservation reserve program.

CONSERVATION MATERIALS AND SERVICES

SEC. 112. (a) The Secretary may purchase conservation materials and services and make such materials and services available to producers under the conservation reserve program to aid them in establishing vegetative cover or water-storage facilities under contracts authorized by this subtitle B, may reimburse any Federal, State, or local government agency for conservation materials and services furnished by such agency, and may pay expenses necessary in making such materials and services available, including all or part of the costs incident to the delivery, application, or installation of materials and services.

(b) Notwithstanding any other provision of law, in making conservation materials and services available to producers hereunder, the Secretary may make payments, in advance of determination of performance by the producers, to persons who fill purchase orders covering approved conservation materials or who render services to the Secretary in furnishing to producers approver conservation materials or services for the establishment by the producers of vegetative cover or water-storage facilities under contracts authorized by this subtitle B. The price at which purchase orders for any conservation material or service are filled may be limited, if the Secretary determines that it is necessary in the interest of producers and the Government, to a fair price fixed in accordance with regulations prescribed by the Secretary.

EFFECT ON OTHER PROGRAMS

SEC. 113. Notwithstanding any other provision of law

(1) insofar as the acreage of cropland on any farm enters into the determination of acreage allotments and marketing quotas under the Agricultural Adjustment Act of 1938, as amended, the cropland acreage on the farm shall not be decreased during the period of any contract entered into under the conservation acreage program by reason of the establishment and maintenance of vegetative cover or water storage facilities under such contract; and

(2) the acreage on any farm which is determined under regulations of the Secretary to have been diverted from the production of any commodity subject to acreage allotments or marketing quotas in order to carry out the contract entered into under the conservation acreage program shall be considered acreage devoted to the commodity for the purposes of establishing future State, county, and farm acreage allotments under the Agricultural Adjustment Act of 1938, as amended.

PROTECTION OF TENANTS AND SHARECROPPERS

SEC. 114. In the administration of the conservation reserve program, the Secretary shall provide adequate safeguards to protect the interests of tenants and sharecroppers.

GEOGRAPHICAL APPLICABILITY

SEC. 115. (a) This subtitle B shall apply to the continental United States, and, if the Secretary determines it to be in the national interest, to one or more of the Territories of Alaska and Hawaii, the Commonwealth of Puerto Rico, and the Virgin Islands, and, as used in this subtitle B, the term "State" includes Alaska, Hawaii, Puerto Rico, and the Virgin Islands.

SUBTITLE C-GENERAL PROVISIONS

CERTIFICATE OF CLAIMANT

SEC. 116. Payment or compensation authorized by this Act may be made upon the certificate of the claimant in such form as the Secretary may prescribe, that he has complied with all requirements for such payments and that the statements and information contained in the application for payment are correct and true, to the best of his knowledge and belief.

UTILIZATION OF LOCAL AND STATE COMMITTEES

SEC. 117. In administering this Act in the continental United States, the Secretary shall utilize the services of community, county, and State committees established under section 8 of the Soil Conservation and Domestic Allotment Act, as amended.

FINANCING

SEC. 118. (a) The Secretary is authorized to utilize the facilities, services, authorities, and funds of the Commodity Credit Corporation in discharging his functions and responsibilities under this Act, including payment of costs of administration for the programs authorized under this Act. There is hereby authorized to be appropriated such sums as may be necessary to make payments to the Corporation for its actual costs incurred under this section.

(b) All funds available for carrying out the purposes of this Act shall be available for transfer to such agencies of the Federal or State governments as the Secretary may request to cooperate or assist in carrying out this Act; and for technical assistance in formulating and carrying out the programs authorized by this Act. The Secretary may make such payments in advance of determination of performance.

FINALITY OF DETERMINATIONS

SEC. 119. The facts constituting the basis for any payment or compensation, or the amount thereof, authorized to be made under this Act, when officially determined in conformity with applicable regulations prescribed by the Secretary, shall be final and conclusive and shall not be reviewable by any other officer or agency of the Government. In case any producer who is entitled to any payment or compensation dies, becomes incompetent, or disappears before receiving such payment or compensation, or is succeeded by another who renders or completes the required performance, the payment or compensation shall, without regard to any other provisions of law, be made as the Secretary may determine to be fair and reasonable in all the circumstances and so provide by regulations.

REGULATIONS

SEC. 120. The Secretary shall prescribe such regulations as he determines necessary to carry out the provisions of this act.

TITLE II-MISCELLANEOUS PROVISIONS AND AMENDMENTS SEC. 201. Section 334 (e) of the Agricultural Adjustment Act of 1938, as amended (7 U. S. C. 1334 (e)), is amended to read as follows:

"(e) Notwithstanding any other provision of this Act, the Secretary shall increase the farm marketing quotas and acreage allotments for the 1956 crop of wheat for farms located in counties in the States of California, Minnesota, Montana, North Dakota, and South Dakota, designated by the Secretary as counties which (1) are capable of producing durum wheat (class II) and (2) have produced such wheat for commercial food products during one or more of the 5 years 1951 through 1955. The increase in the wheat acreage allotment for any farm shall be conditioned upon the production of durum wheat (class II) on such increased acreage. The increased allotment shall be determined by adding to the allotment established without regard to this subsection (here

inafter referred to as the 'original allotment'), less the reserve acreage of wheat established under subtitle A of the Soil Bank Act, an acreage equal to two times the acreage by which the original allotment, less the reserve acreage of wheat under such subtitle A, exceeds the 1956 acreage on the farm of classes of wheat other than durum wheat (class II) (hereinafter referred to as 'other wheat'), but such increased allotment shall not exceed the smaller of the cropland on the farm well suited to wheat or the wheat acreage on the farm: Provided, That for the purposes of this subsection (e), the original allotment, less the reserve acreage of wheat under such subtitle A, for each farm shall be not less than fifteen acres, and varieties of durum wheat (class II) known as 'Golden Ball' and 'Peliss' shall be regarded as other wheat.

"The increases in wheat acreage allotments authorized by this subsection shall be in addition to the National, State, and county wheat acreage allotments, and the acreage of durum wheat (class II) on such increased allotments shall not be considered in establishing future State, county, and farm acreage allotments.

"The provisions of paragraph (6) of Public Law 74, Seventy-seventh Congress (7 U. S. C. 1340 (6)), and section 326 (b) of the Agricultural Adjustment Act of 1938, as amended (7 U. S. C. 1326 (b)), relating to the reduction of the storage amount of wheat shall apply to the allotment for the farm established without regard to this subsection (e) and not to the increased allotment under this subsection."

SEC. 202. Section 335 (e) of the Agricultural Adjustment Act of 1938, as amended (7 U. S. C. 1335 (e)), is amended effective beginning with the 1957 crop by changing the first sentence thereof to read as follows: "If, for any marketing year, the acreage allotment for wheat for any State is two hundred and forty thousand acres or less, the Secretary, in order to promote efficient administration of the Act and the Agricultural Act of 1949, may designate such State as outside the commercial wheat-producing area for such marketing year." SEC. 203. Section 358 of the Agricultural Adjustment Act of 1938, as amended (7 U. S. C. 1358), is amended by deleting the proviso at the end of the last sentence of subsection (a).

SEC. 204. Section 201 (c) of the Agricultural Act of 1949, as amended, is amended by changing the last sentence to read as follows: "For the period beginning September 1, 1954, and ending June 30, 1955, not to exceed $50,000,000, for the fiscal year ending June 30, 1956, not be exceed $60,000,000, and for each of the two fiscal years in the period beginning July 1, 1956, and ending June 30, 1958, not to exceed $75,000,000, of funds of the Commodity Credit Corporation shall be used to increase the consumption of fluid milk by children in nonprofit schools of high-school grade and under."

SEC. 205. (a) Section 403 of the Agricultural Act of 1949, as amended, is amended by striking out the last sentence thereof:

(b) Section 3 (a) of the Act of August 29, 1949 (7 U. S. C. 1301 (b)), is repealed.

SEC. 206. Section 407 of the Agricultural Act of 1949, as amended, is further amended

(a) by revising the third sentence thereof to read as follows: "The Corporation shall not sell any basic agricultural commodity or storable nonbasic commodity at less than the current support price for such commodity, plus reasonable carrying charges."; and

(b) by adding at the end of the section the following: "Notwithstanding the foregoing restrictions, the Corporation may sell annually not to exceed 100,000,000 bushels of less desirable milling quality wheat for feeding purposes, provided that in establishing the sales price of such wheat due consideration shall be given to the feeding value of wheat and to the effect that such sales of wheat will have on the price of feed grains." SEC. 207. (a) Strategic materials acquired by the Commodity Credit Corporation as a result of barter or exchange of agricultural commodities or products, unless acquired for the national stockpile established pursuant to the Strategic and Critical Materials Stockpile Act (50 U. S. C. 98-98h), or for other purposes shall be transferred to the supplemental stockpile established by section 104 (b) of the Agricultural Trade Development and Assistance Act of 1954 (7 U. S. C. 1704) if within the limits determined for the supplemental stockpile pursuant to such section 104 (b).

(b) Strategic materials acquired by the Commodity Credit Corporation as a result of barter or exchange of agricultural commodities or products may be entered, or withdrawn from warehouse, free of duty.