B-140308, AUG. 19, 1959

B-140308: Aug 19, 1959

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MAY A PRODUCER WHO PLACED LAND UNDER A CONTRACT PRIOR TO 1960 (WHICH IS NOT EXPIRING AT THE END OF 1959) LEGALLY BE PERMITTED TO ENTER INTO A TEN-YEAR CONTRACT BEGINNING IN 1960. WHEN THE CONTRACT WILL INCLUDE FOR THE ENTIRE CONTRACT PERIOD LAND UNDER THE EXISTING CONTRACT? THE PRODUCER WITH THE EXPIRING CONTRACT AND THE PRODUCER ADDING ADDITIONAL LAND WILL BE REQUIRED. THE PROVISIONS PERMITTING A PRODUCER WHO SELLS HIS FARM TO RETAIN THE COST-SHARING PAYMENTS HE RECEIVES IF THE BUYER OF THE FARM AGREES TO CONTINUE THE LAND IN THE PROGRAM WILL. THE PAYMENT RATES AND THE MAXIMUM LIMITATIONS ON SUCH RATES PREVIOUSLY ESTABLISHED FOR THE LAND UNDER THE EXISTING CONTRACT WILL REMAIN IN EFFECT FOR THAT LAND UNLESS A LOWER RATE WOULD BE OBTAINED BY APPLICATION OF THE NEW PAYMENT RATES AND LIMITATIONS.

B-140308, AUG. 19, 1959

TO THE SECRETARY OF AGRICULTURE:

BY LETTER OF JULY 24, 1959, YOUR ASSISTANT SECRETARY, MARVIN L. MCLAIN, ASKED OUR OPINION ON THE FOLLOWING QUESTIONS RELATING TO THE SOIL BANK PROGRAM.

1. MAY A PRODUCER WHO PLACED LAND UNDER A THREE-YEAR OR A FOUR-YEAR CONSERVATION RESERVE CONTRACT EXPIRING AT THE END OF 1959 LEGALLY BE PERMITTED TO ENTER INTO A TEN-YEAR CONTRACT BEGINNING IN 1960 COVERING THE SAME LAND?

2. MAY A PRODUCER WHO PLACED LAND UNDER A CONTRACT PRIOR TO 1960 (WHICH IS NOT EXPIRING AT THE END OF 1959) LEGALLY BE PERMITTED TO ENTER INTO A TEN-YEAR CONTRACT BEGINNING IN 1960, PLACING ADDITIONAL LAND IN THE PROGRAM, WHEN THE CONTRACT WILL INCLUDE FOR THE ENTIRE CONTRACT PERIOD LAND UNDER THE EXISTING CONTRACT?

THE ASSISTANT SECRETARY EXPLAINS IN HIS LETTER THAT---

"AS NOW CONTEMPLATED, THE PRODUCER WITH THE EXPIRING CONTRACT AND THE PRODUCER ADDING ADDITIONAL LAND WILL BE REQUIRED, IN ORDER TO CONTINUE IN THE PROGRAM, TO SIGN NEW CONTRACTS, AGREEING TO A NUMBER OF MAJOR CHANGES IN THE PROGRAM. FOR EXAMPLE, THE PROVISIONS PERMITTING A PRODUCER WHO SELLS HIS FARM TO RETAIN THE COST-SHARING PAYMENTS HE RECEIVES IF THE BUYER OF THE FARM AGREES TO CONTINUE THE LAND IN THE PROGRAM WILL, EXCEPT IN CERTAIN CASES, NO LONGER BE APPLICABLE. WITH RESPECT TO THE PRODUCER ADDING LAND, THE PAYMENT RATES AND THE MAXIMUM LIMITATIONS ON SUCH RATES PREVIOUSLY ESTABLISHED FOR THE LAND UNDER THE EXISTING CONTRACT WILL REMAIN IN EFFECT FOR THAT LAND UNLESS A LOWER RATE WOULD BE OBTAINED BY APPLICATION OF THE NEW PAYMENT RATES AND LIMITATIONS. IN BOTH CASES, THE OLD CONTRACT WILL CEASE TO BE EFFECTIVE FROM THE DATE THE NEW CONTRACT GOES INTO EFFECT.

"AS STATED ABOVE, SECTION 109 (B) OF THE SOIL BANK ACT PROVIDES THAT "THE PERIOD COVERED BY ANY CONTRACT SHALL NOT EXCEED TEN YEARS.' A CONTRACT FOR A TEN-YEAR PERIOD BEGINNING IN 1960 WHICH WILL COVER LAND UNDER A CONTRACT WHICH IS EXPIRING AT THE END OF 1959 AND A CONTRACT FOR A TEN- YEAR PERIOD BEGINNING IN 1960 WHICH WILL INCLUDE LAND UNDER AN EXISTING CONTRACT FOR THE ENTIRE CONTRACT PERIOD WOULD, IN OUR VIEW, BE NEW CONTRACTS, AND NOT EXTENSIONS OR MODIFICATIONS OF EXISTING CONTRACTS. NONE OF THE CONTRACTS WOULD BE FOR A PERIOD EXCEEDING TEN YEARS. THEREFORE, IN OUR OPINION, THE EXECUTION OF THE CONTRACTS IS NOT PROHIBITED BY THE ACT.'

THE QUESTIONS ARISE BY REASON OF SECTION 109 OF THE SOIL BANK ACT, 70 STAT. 194, 7 U.S.C. 1833 (A) AND (B), WHICH PROVIDES IN PART AS FOLLOWS:

"/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, EXCEPT THAT CONTRACTS FOR THE ESTABLISHMENT OF TREE COVER MAY CONTINUE UNTIL DECEMBER 31, 1974.

"/B) THE PERIOD COVERED BY ANY CONTRACT SHALL NOT EXCEED TEN YEARS, EXCEPT THAT CONTRACTS FOR THE ESTABLISHMENT OF TREE COVER MAY EXTEND FOR 15 YEARS.'

THE FOREGOING PROVISIONS OF LAW AUTHORIZES THE SECRETARY OF AGRICULTURE TO ENTER INTO CONTRACTS WITH PRODUCERS DURING THE FIVE YEAR PERIOD 1956- 1960 ENDING NOT LATER THAN DECEMBER 31, 1969, FOR OTHER THAN TREE COVER CONSERVATION USES. IT FURTHER PROHIBITS THE EXECUTION OF ANY SUCH CONTRACT FOR A PERIOD IN EXCESS OF TEN YEARS. NEITHER SECTION 109 NOR ANY OTHER PROVISION OF THE SOIL BANK ACT SPECIFICALLY PRECLUDES THE EXECUTION OF MORE THAN ONE CONTRACT ON THE SAME LAND FOR CONSECUTIVE PERIODS AND WE HAVE FOUND NOTHING IN THE LEGISLATIVE HISTORY OF THE SOIL BANK ACT INDICATING ANY INTENT TO RESTRICT THE COVERING OF LAND TO ONLY ONE CONTRACT.

THE POSSIBILITY OF COVERING THE SAME LAND UNDER A NEW CONTRACT WAS APPARENT FROM A READING OF THE LANGUAGE IN SECTION 107 (A) WHICH PRESCRIBES A MINIMUM CONTRACT PERIOD OF THREE YEARS AND SECTION 109 WHICH, AS STATED ABOVE, PRESCRIBES A FIVE-YEAR PERIOD FOR MAKING THE CONTRACTS AND A FIFTEEN-YEAR PERIOD FOR THEIR BEING CARRIED OUT. IT WOULD THEREFORE APPEAR TO US THAT IF IT HAD BEEN INTENDED TO PRECLUDE LAND FROM BEING INCLUDED IN MORE THAN ONE CONSERVATION RESERVE CONTRACT, IT WOULD HAVE BEEN SO PROVIDED, OR AT LEAST, DISCUSSED IN THE LEGISLATIVE HISTORY OF THE SOIL BANK ACT.

WE THEREFORE SEE NO LEGAL OBJECTION TO THE EXECUTION OF A NEW CONTRACT DURING THE PERIOD 1956-1960 COVERING A PERIOD NOT LESS THAN THREE YEARS NOR MORE THAN TEN YEARS EVEN THOUGH THE SAME LAND WAS COVERED UNDER A PRIOR CONTRACT WHICH HAD BEEN FULLY EXECUTED.

AS TO THE SECOND QUESTION SECTION 210 (A) OF THE ACT AUTHORIZES THE SECRETARY TO TERMINATE ANY CONTRACT WITH A PRODUCER BY MUTUAL AGREEMENT IF THE SECRETARY DETERMINES THAT SUCH TERMINATION WOULD BE IN THE PUBLIC INTEREST. IF, UNDER THAT AUTHORITY, AN EXISTING CONTRACT WERE TERMINATED WE PERCEIVE NO VALID REASON WHY A NEW CONTRACT COULD NOT BE ENTERED INTO WITH THE SAME PRODUCER DURING THE PERIOD 1956-1960 ON THE BASIS PROPOSED IN THE ASSISTANT SECRETARY'S LETTER.