Sec. 1401. Dairy margin coverage

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Not later than 60 days after the date of the enactment of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report evaluating the extent to which the average cost of feed used by a dairy operation to produce a hundredweight of milk calculated by the Secretary as required by section 1402(a) of the Agricultural Act of 2014 ( 7 U.S.C. 9052(a) ) is representative of actual dairy feed costs.

Not later than 1 year after the date of the enactment of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report detailing the costs incurred by dairy operations in the use of corn silage as feed, and the difference between the feed cost of corn silage and the feed cost of corn. Not later than 120 days after the date of the enactment of this Act, the Secretary, acting through the National Agricultural Statistics Service, shall revise monthly price survey reports to include prices for high-quality alfalfa hay in the top five milk producing States, as measured by volume of milk produced during the previous month.

Section 1404(b) of the Agricultural Act of 2014 ( 7 U.S.C. 9054(b) ) is amended— by redesignating paragraph

(4)as paragraph (5); and by striking paragraph

(3)and inserting the following: For the 2019 calendar year, the Secretary shall— open the election period not later than 60 days after the effective date described in section 1401(m) of the Agriculture Improvement Act of 2018 ; and hold that election period open for not less than 90 days. If a participating dairy operation is operated by more than 1 dairy producer, the dairy producers of the dairy operation who elect to participate shall be treated as a single dairy operation for purposes of participating in dairy margin coverage. Subparagraph

(A)shall not be construed to allow a producer to adjust the proportion of their share covered under tier I or tier II premiums from the proportion covered for the operation. . Section 1404 of the Agricultural Act of 2014 ( 7 U.S.C. 9054 ) is amended by striking subsection (d). Section 1404(b)(2) of the Agricultural Act of 2014 ( 7 U.S.C. 9054(b)(2) ) is amended— by striking The Secretary and inserting the following: The Secretary ; and by adding at the end the following: In the case of a dairy operation that, by operation of subsection

(d)(as in effect on the day before the date of enactment of the Agriculture Improvement Act of 2018 ), was ineligible to participate in the margin protection program for any part of calendar year 2018, the Secretary shall establish a new election period for that calendar year that ends on a date that is not less than 90 days after the date of enactment of the Agriculture Improvement Act of 2018 and the Secretary determines is necessary for dairy operations to make new elections to participate in the margin protection program (as in effect on the day before the date of enactment of the Agriculture Improvement Act of 2018 ) for that calendar year, including dairy operations that elected to participate in the livestock gross margin for dairy program under the Federal Crop Insurance Act ( 7 U.S.C. 1501 et seq.) before the date of enactment of the Bipartisan Budget Act of 2018 ( Public Law 115–123 ). . Section 1405 of the Agricultural Act of 2014 ( 7 U.S.C. 9055 ) is amended— in subsection (a)— in paragraph (2), by striking In subsequent years and inserting In the subsequent calendar years ending before January 1, 2019 ; and in paragraph (3), by inserting , as applicable after paragraph

(2); and in subsection (b)— by redesignating paragraphs

(1)and

(2)as subparagraphs

(A)and (B), respectively, and indenting appropriately; in the matter preceding subparagraph

(A)(as so redesignated), by striking In the case and inserting the following: In the case ; and by adding at the end the following: In the case of a participating dairy operation that was not in operation prior to January 1, 2014, that has not established a production history, and that has been in operation for equal to or longer than 1 year, the participating dairy operation shall elect the annual milk marketings during any 1 calendar year to determine the production history of the participating dairy operation. The Secretary shall adjust the production history of a participating dairy operation determined under paragraph

(1)or

(2)to reflect any increase or decrease in the national average milk production relative to calendar year 2017. . Section 1405 of the Agricultural Act of 2014 ( 7 U.S.C. 9055 ) is amended by adding at the end the following new subsection: The Secretary may not make dairy margin coverage payments to a participating dairy operation if the Secretary determines that the participating dairy operation has reorganized the structure of such operation solely for the purpose of qualifying as a new operation under subsection (b). . Section 1406 of the Agricultural Act of 2014 ( 7 U.S.C. 9056 ) is amended by striking subsection

(a)and inserting the following: For purposes of receiving dairy margin coverage payments for a month, a participating dairy operation shall annually elect a coverage level threshold that is equal to $4.00, $4.50, $5.00, $5.50, $6.00, $6.50, $7.00, $7.50, $8.00, $8.50, $9.00, or $9.50. Except as provided in subparagraph (C), the coverage level threshold elected under subparagraph

(A)shall apply to the covered production elected by the participating dairy operation under paragraph (2). In the case of a participating dairy operation that elects a coverage level threshold of $8.50, $9.00, or $9.50 under subparagraph (A)— that coverage level threshold shall apply to the first 5,000,000 pounds of milk marketings included in the covered production elected by the participating dairy operation; and the participating dairy operation shall elect a coverage level threshold that is equal to $4.00, $4.50, $5.00, $5.50, $6.00, $6.50, $7.00, $7.50, or $8.00 to apply to milk marketings in excess of 5,000,000 pounds included in the covered production elected by the participating dairy operation. For purposes of receiving dairy margin coverage payments for a month, a participating dairy operation shall annually elect a percentage of coverage, in 5-percent increments, not exceeding 95 percent of the production history of the participating dairy operation. . Section 1407 of the Agricultural Act of 2014 ( 7 U.S.C. 9057 ) is amended— in subsection (b), by striking paragraphs

(2)and

(3)and inserting the following: Except as provided in subsection (g), the following annual premiums apply: Coverage Level Premium per Cwt. $4.00 None $4.50 $0.0025 $5.00 $0.005 $5.50 $0.030 $6.00 $0.050 $6.50 $0.070 $7.00 $0.080 $7.50 $0.090 $8.00 $0.100 $8.50 $0.105 $9.00 $0.110 $9.50 $0.150 ; and in subsection (c), by striking paragraph

(2)and inserting the following: Except as provided in subsection (g), the following annual premiums apply: Coverage Level Premium per Cwt. $4.00 None $4.50 $0.0025 $5.00 $0.005 $5.50 $0.100 $6.00 $0.310 $6.50 $0.650 $7.00 $1.107 $7.50 $1.413 $8.00 $1.813 . Section 1407 of the Agricultural Act of 2014 ( 7 U.S.C. 9057 ) is amended by adding at the end the following: Each dairy operation described in paragraph

(2)shall be eligible to receive a repayment from the Secretary in an amount equal to the difference between— the total amount of premiums paid by the participating dairy operation under this section for each applicable calendar year; and the total amount of payments made to the participating dairy operation under section 1406 for that calendar year. A dairy operation that is eligible to receive a repayment under paragraph

(1)is a dairy operation that— participated in the margin protection program, as in effect for any of calendar years 2014 through 2017; and submits to the Secretary an application for the repayment at such time, in such manner, and containing such information as the Secretary may require. A dairy operation that is eligible to receive a repayment under paragraph

(1)shall elect to receive the repayment— in an amount equal to 75 percent of the repayment calculated under that paragraph as credit that may be used by the dairy operation for dairy margin coverage premiums; or in an amount equal to 50 percent of the repayment calculated under that paragraph as a direct cash repayment. Paragraph

(1)shall only apply to a calendar year during the period of calendar years 2014 through 2017 for which the amount described in subparagraph

(A)of that paragraph is greater than the amount described in subparagraph

(B)of that paragraph. . Section 1407 of the Agricultural Act of 2014 ( 7 U.S.C. 9057 ) (as amended by subsection (i)) is amended by adding at the end the following: The premium per hundredweight specified in the tables contained in subsections

(b)and

(c)for each coverage level shall be reduced by 25 percent in accordance with the following: For each of calendar years 2019 through 2023, for a participating dairy operation that makes a 1-time election of coverage level in a tier and of a percentage of coverage under section 1406(a) for the 5-year period beginning in January 2019. For each applicable calendar year through 2023, for a participating dairy operation that— establishes a production history pursuant to section 1405(b); and makes a 1-time election of coverage level in a tier and of a percentage of coverage under section 1406(a) for the period beginning with the first available calendar year and ending in December 2023. Notwithstanding the annual elections under section 1406(a)— a 1-time enrollment under this subsection shall remain in effect for the full duration applicable to a participating dairy operation in accordance with paragraph

(1)or (2)(B), as applicable; and a participating dairy operation that makes a 1-time enrollment under this subsection and is noncompliant under section 1408 shall be subject to that section. . The heading of part I of subtitle D of title I of the Agricultural Act of 2014 ( Public Law 113–79 ; 128 Stat. 688) is amended to read as follows: . Section 1401 of the Agricultural Act of 2014 ( 7 U.S.C. 9051 ) is amended— by striking paragraphs

(5)and

(6)and inserting the following new paragraphs: The term dairy margin coverage means the dairy margin coverage program required by section 1403. The term dairy margin coverage payment means a payment made to a participating dairy operation under dairy margin coverage pursuant to section 1406. ; and in paragraphs

(7)and (8), by striking the margin protection program both places it appears and inserting dairy margin coverage . Section 1402(b)(1) of the Agricultural Act of 2014 ( 7 U.S.C. 9052(b)(1) ) is amended in the matter preceding subparagraph

(A)by striking the margin protection program and inserting dairy margin coverage . Section 1403 of the Agricultural Act of 2014 ( 7 U.S.C. 9053 ) is amended— by striking the section heading and inserting ; DAIRY MARGIN COVERAGE by striking Not later than September 1, 2014, the Secretary shall establish and administer a margin protection program and inserting the following: The Secretary shall continue to administer a dairy margin coverage program ; in subsection

(a)(as so designated), by striking margin protection payment both places it appears and inserting dairy margin coverage payment ; and by adding at the end the following: Subpart A of part 1430 of title 7, Code of Federal Regulations (as in effect on the date of enactment of the Agriculture Improvement Act of 2018 ), shall remain in effect for dairy margin coverage beginning with the 2019 calendar year, except to the extent that the regulations are inconsistent with any provision of this Act. . Section 1404 of the Agricultural Act of 2014 ( 7 U.S.C. 9054 ) is amended— in the section heading, by striking and inserting MARGIN PROTECTION PROGRAM ; DAIRY MARGIN COVERAGE in subsection (a), by striking the margin protection program to receive margin protection payments and inserting dairy margin coverage to receive dairy margin coverage payments ; and in subsections

(b)and (c), by striking the margin protection program each place it appears and inserting dairy margin coverage . Section 1405 of the Agricultural Act of 2014 ( 7 U.S.C. 9055 ) is amended in subsections (a)(1) and

(c)by striking the margin protection program each place it appears and inserting dairy margin coverage . Section 1406 of the Agricultural Act of 2014 ( 7 U.S.C. 9056 ) is amended— in the section heading, by striking and inserting MARGIN PROTECTION ; DAIRY MARGIN COVERAGE by striking margin protection each place it appears and inserting dairy margin coverage ; and in the heading of subsection (c), by striking . Margin Protection Section 1407 of the Agricultural Act of 2014 ( 7 U.S.C. 9057 ) is amended— in the section heading, by striking and inserting MARGIN PROTECTION PROGRAM ; DAIRY MARGIN COVERAGE in subsection (a), in the matter preceding paragraph (1), by striking the margin protection program and inserting dairy margin coverage ; in subsection (d), by striking program and inserting dairy margin coverage ; and in subsection (e)— by striking the margin protection program both places it appears and inserting dairy margin coverage ; and in paragraph (2), by striking integrity of the program and inserting integrity of dairy margin coverage . Section 1408 of the Agricultural Act of 2014 ( 7 U.S.C. 9058 ) is amended— in subsection (a)(2), by striking margin protection and inserting dairy margin coverage ; and in subsection (b), by striking the margin protection program and inserting dairy margin coverage . Section 1410 of the Agricultural Act of 2014 ( 7 U.S.C. 9060 ) is amended— in subsections

(a)and (c), by striking the margin protection program each place it appears and inserting dairy margin coverage ; and in subsection (b), by striking margin protection and inserting dairy margin coverage . Section 1409 of the Agricultural Act of 2014 ( 7 U.S.C. 9059 ) is amended— by striking The margin protection program and inserting Dairy margin coverage ; and by striking 2018 and inserting 2023 . The amendments made by this section shall take effect on January 1, 2019.

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