7 U.S.C. § 7331 (changes) — Options pilot program

Current — June 20, 2000

As of April 4, 1996

(a) Pilot programs authorized

Until December 31, 2002, the Secretary of Agriculture may conduct a pilot program for 1 or more agricultural commodities supported under this chapter to ascertain whether futures and options contracts can provide producers with reasonable protection from the financial risks of fluctuations in price, yield, and income inherent in the production and marketing of the commodities. The pilot program shall be an alternative to other related programs of the Department of Agriculture.

(b) Distribution of pilot program

For each agricultural commodity included in the pilot program, the Secretary may operate the pilot program in not more than ~~100~~ counties, except that not more than 6 of the counties may be located in any 1 State. The pilot program for a commodity shall not be operated in any county for more than 3 of the 1996 through 2002 calendar years.

For each agricultural commodity included in the pilot program, the Secretary may operate the pilot program in not more than 300 counties, except that not more than 25 of the counties may be located in any 1 State. The pilot program for a commodity shall not be operated in any county for more than 3 of the 1996 through 2002 calendar years.

In operating the pilot program, the Secretary may enter into contract with a producer who—

(1) is eligible for a production flexibility contract, a marketing assistance loan, or other assistance under this chapter;

(2) volunteers to participate in the pilot program;

(2) volunteers to participate in the pilot program during any calendar year in which a county in which the farm of the producer is located is included in the pilot program;

(3) operates a farm located in a county selected for the pilot program; and

(4) meets such other eligibility requirements as the Secretary may establish.

(d) Notice to producers

The Secretary shall provide notice to each producer participating in the pilot program that—

(1) the participation of the producer is voluntary; and

(2) neither the United States, the Commodity Credit Corporation, the Federal Crop Insurance Corporation, the Department of Agriculture, nor any other Federal agency is authorized to guarantee that participants in the pilot program will be better or worse off financially as a result of participation in the pilot program than the producer would have been if the producer had not participated in the pilot program.

(e) Contracts

The Secretary shall set forth in each contract under the pilot program the terms and conditions for participation in the pilot program and the notice required by subsection (d) of this section.

(f) Eligible markets

Trades for futures and options contracts under the pilot program shall be carried out on commodity futures and options markets designated as contract markets under the Commodity Exchange Act (7 U.S.C. 1 et seq.).

(g) Recordkeeping

A producer participating in the pilot program shall compile, maintain, and submit (or authorize the compilation, maintenance, and submission) of such documentation as the regulations governing the pilot program require.

(h) Use of Commodity Credit Corporation

The Secretary shall fund and operate the pilot program through the Commodity Credit ~~Corporation.~~ To the maximum extent practicable, the Secretary shall operate the pilot program in a budget neutral manner.

The Secretary shall fund and operate the pilot program through the Commodity Credit Corporation, except that the amount of Commodity Credit Corporation funds used to carry out this section shall not exceed, to the maximum extent practicable, $9,000,000 for fiscal year 2001, $15,000,000 for fiscal year 2002, and $2,000,000 for fiscal year 2003. To the maximum extent practicable, the Secretary shall operate the pilot program in a budget neutral manner.