
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 7USC7212]

 
                          TITLE 7--AGRICULTURE
 
               CHAPTER 100--AGRICULTURAL MARKET TRANSITION
 
             SUBCHAPTER II--PRODUCTION FLEXIBILITY CONTRACTS
 
Sec. 7212. Elements of contracts


(a) Time for contracting

                          (1) Commencement

        To the extent practicable, the Secretary shall commence entering 
    into contracts not later than 45 days after April 4, 1996.

                            (2) Deadline

        Except as provided in paragraph (3), the Secretary may not enter 
    into a contract after August 1, 1996.

                   (3) Conservation reserve lands

        (A) In general

            At the beginning of each fiscal year, the Secretary shall 
        allow an eligible owner or producer on a farm covered by a 
        conservation reserve contract entered into under section 3831 of 
        title 16 that terminates after the date specified in paragraph 
        (2) to enter into or expand a production flexibility contract to 
        cover the contract acreage of the farm that was subject to the 
        former conservation reserve contract.

        (B) Amount

            Contract payments made for contract acreage under this 
        paragraph shall be made at the rate and amount applicable to the 
        annual contract payment level for the applicable crop. For the 
        fiscal year in which the conservation reserve contract is 
        terminated, the owner or producer subject to the production 
        flexibility contract may elect to receive either contract 
        payments or a prorated payment under the conservation reserve 
        contract, but not both.

(b) Duration of contract

                         (1) Beginning date

        The term of a contract shall begin with--
            (A) the 1996 crop of a contract commodity; or
            (B) in the case of acreage that was subject to a 
        conservation reserve contract described in subsection (a)(3) of 
        this section, the date the production flexibility contract was 
        entered into or expanded to cover the acreage.

                           (2) Ending date

        The term of a contract shall extend through the 2002 crop, 
    unless earlier terminated by the owner or producer.

(c) Estimation of contract payments

    At the time the Secretary enters into a contract, the Secretary 
shall provide an estimate of the minimum contract payments anticipated 
to be made during at least the first fiscal year for which contract 
payments will be made.

(d) Time for payment

                           (1) In general

        An annual contract payment shall be made not later than 
    September 30 of each of fiscal years 1996 through 2002.

                        (2) Advance payments

        (A) Fiscal year 1996

            At the option of the owner or producer, 50 percent of the 
        contract payment for fiscal year 1996 shall be made not later 
        than 30 days after the date on which the contract is entered 
        into and approved by the Secretary and the owner or producer.

        (B) Subsequent fiscal years

            At the option of the owner or producer for fiscal year 1997 
        and each subsequent fiscal year, 50 percent of the annual 
        contract payment shall be made on December 15 or January 15 of 
        the fiscal year. The owner or producer may change the date 
        selected under this subparagraph for a subsequent fiscal year by 
        providing advance notice to the Secretary.

                          (3) Special rule

        Notwithstanding the requirements for making an annual contract 
    payment specified in paragraphs (1) and (2), at the option of the 
    owner or producer, the Secretary shall pay the full amount (or such 
    portion as the owner or producer may specify) of the contract 
    payment required to be paid for any of fiscal years 1999 through 
    2002 at such time or times during that fiscal year as the owner or 
    producer may specify.

(Pub. L. 104-127, title I, Sec. 112, Apr. 4, 1996, 110 Stat. 899; Pub. 
L. 105-228, Sec. 2, Aug. 12, 1998, 112 Stat. 1516; Pub. L. 106-78, title 
VIII, Sec. 811, Oct. 22, 1999, 113 Stat. 1181.)


                               Amendments

    1999--Subsec. (d)(3). Pub. L. 106-78, in par. heading, struck out 
``for fiscal year 1999'' after ``rule'' and, in text, substituted ``any 
of fiscal years 1999 through 2002'' for ``fiscal year 1999''.
    1998--Subsec. (d)(3). Pub. L. 105-228 added par. (3).


                Production Flexibility Contract Payments

    Pub. L. 106-170, title V, Sec. 525, Dec. 17, 1999, 113 Stat. 1928, 
provided that: ``Any option to accelerate the receipt of any payment 
under a production flexibility contract which is payable under the 
Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7200 
[7201] et seq.), as in effect on the date of the enactment of this Act 
[Dec. 17, 1999], shall be disregarded in determining the taxable year 
for which such payment is properly includible in gross income for 
purposes of the Internal Revenue Code of 1986 [26 U.S.C. 1 et seq.].''
    Pub. L. 105-277, div. J, title II, Sec. 2012, Oct. 21, 1998, 112 
Stat. 2681-902, provided that:
    ``(a) In General.--The options under paragraphs (2) and (3) of 
section 112(d) of the Federal Agriculture Improvement and Reform Act of 
1996 (7 U.S.C. 7212(d)(2) and (3)), as in effect on the date of the 
enactment of this Act [Oct. 21, 1998], shall be disregarded in 
determining the taxable year for which any payment under a production 
flexibility contract under subtitle B of title I of such Act [7 U.S.C. 
7211 et seq.] (as so in effect) is properly includible in gross income 
for purposes of the Internal Revenue Code of 1986 [26 U.S.C. 1 et seq.].
    ``(b) Effective Date.--Subsection (a) shall apply to taxable years 
ending after December 31, 1995.''

                  Section Referred to in Other Sections

    This section is referred to in section 7211 of this title.
