B-140651, SEP. 11, 1959

B-140651: Sep 11, 1959

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WE HAVE BEEN INFORMALLY ADVISED BY A REPRESENTATIVE OF YOUR DEPARTMENT THAT THIS IS CAUSING INEQUITIES IN VARIOUS AREAS WHERE CROPS WERE HARVESTED ONLY EVERY OTHER YEAR OR WHERE THERE WERE ABNORMAL WEATHER CONDITIONS DURING THE 5-YEAR PERIOD INVOLVED AND LAND IS NOT RENTED ON A CASH BASIS. AS INDICATED IN THE ASSISTANT SECRETARY'S LETTER THERE IS NOTHING IN THE LEGISLATIVE HISTORY OF THE PROVISION WHICH SHEDS ANY LIGHT AS TO HOW THE CONGRESS INTENDED IT TO BE INTERPRETED. WHILE THE APPARENT PURPOSE OF THE ABOVE-QUOTED STATUTORY PROVISION IS TO INSURE THAT THE RENTAL RATE ESTABLISHED FOR LAND PLACED IN THE CONSERVATION RESERVE PROGRAM WILL NOT BE EXCESSIVE. UNDER THE ABOVE-QUOTED PROVISION OF LAW THE LOCAL FAIR RENTAL VALUE IS MERELY REQUIRED TO BE BASED UPON THE ACREAGE CROP PRODUCTION AVERAGE DURING THE 5-YEAR PERIOD INVOLVED.

B-140651, SEP. 11, 1959

TO THE SECRETARY OF AGRICULTURE:

LETTER DATED AUGUST 31, 1959, FROM ASSISTANT SECRETARY OF AGRICULTURE, MARVIN L. MCLAIN, REQUESTS A DECISION WHETHER FOR THE PURPOSES OF THE LIMITATION CONTAINED IN THE DEPARTMENT OF AGRICULTURE AND FARM CREDIT ADMINISTRATION APPROPRIATION ACT, 1960, PUBLIC LAW 86 80, 73 STAT. 167, ADJUSTMENTS IN PRODUCTION HISTORY MAY BE MADE FOR DROUGHT, FLOOD, OR OTHER ABNORMAL CONDITIONS IN ESTABLISHING THE FAIR RENTAL VALUE OF LAND PLACED IN THE CONSERVATION RESERVE PROGRAM.

THE LIMITATION IN QUESTION READS AS FOLLOWS (73 STAT. 174):

"* * * PROVIDED FURTHER, THAT * * * (2) IN ESTABLISHING ANNUAL RENTAL RATES FOR NEW CONTRACTS, NO SUCH RENTAL RATE SHALL BE ESTABLISHED IN EXCESS OF THE LOCAL FAIR RENTAL VALUE OF THE ACREAGE OFFERED, SUCH FAIR RENTAL VALUE TO BE BASED UPON THE AVERAGE ANNUAL CROP PRODUCTION HARVESTED FROM SUCH ACREAGE DURING THE PAST FIVE CROP YEARS INCLUDING THE CURRENT YEAR, * * *"

WE UNDERSTAND THAT CURRENT REGULATIONS OF YOUR DEPARTMENT IMPLEMENTING THE ABOVE QUOTED PROVISION OF LAW FIX THE ANNUAL RENTAL RATE OF LAND PLACED IN THE CONSERVATION RESERVE PROGRAM AT THE VALUE OF THE CROP PRODUCTION HARVESTED FROM THE ACREAGE INVOLVED DURING THE PAST 5 YEARS DIVIDED BY 5. WE HAVE BEEN INFORMALLY ADVISED BY A REPRESENTATIVE OF YOUR DEPARTMENT THAT THIS IS CAUSING INEQUITIES IN VARIOUS AREAS WHERE CROPS WERE HARVESTED ONLY EVERY OTHER YEAR OR WHERE THERE WERE ABNORMAL WEATHER CONDITIONS DURING THE 5-YEAR PERIOD INVOLVED AND LAND IS NOT RENTED ON A CASH BASIS.

THE LIMITATION IN QUESTION RESULTED FROM THE ACTION OF THE HOUSE--- IN CONNECTION WITH THE ADOPTION OF THE CONFERENCE REPORT ON THE BILL WHICH BECAME THE ABOVE-CITED APPROPRIATION ACT--- IN CONCURRING IN A SENATE AMENDMENT WITH AN AMENDMENT THERETO (THE ABOVE-QUOTED PROVISION BEING THE HOUSE AMENDMENT), WITH WHICH ACTION THE SENATE CONCURRED. AS INDICATED IN THE ASSISTANT SECRETARY'S LETTER THERE IS NOTHING IN THE LEGISLATIVE HISTORY OF THE PROVISION WHICH SHEDS ANY LIGHT AS TO HOW THE CONGRESS INTENDED IT TO BE INTERPRETED.

WHILE THE APPARENT PURPOSE OF THE ABOVE-QUOTED STATUTORY PROVISION IS TO INSURE THAT THE RENTAL RATE ESTABLISHED FOR LAND PLACED IN THE CONSERVATION RESERVE PROGRAM WILL NOT BE EXCESSIVE, WE DO NOT BELIEVE THAT THE CONGRESS INTENDED TO REQUIRE AN INTERPRETATION OF THE LIMITATION WHICH WOULD NOT TRULY REFLECT THE LOCAL FAIR RENTAL VALUE OF THE ACREAGE. MOREOVER, UNDER THE ABOVE-QUOTED PROVISION OF LAW THE LOCAL FAIR RENTAL VALUE IS MERELY REQUIRED TO BE BASED UPON THE ACREAGE CROP PRODUCTION AVERAGE DURING THE 5-YEAR PERIOD INVOLVED. HENCE, IF YOU DEEM IT OTHERWISE NECESSARY AND PROPER IN DETERMINING THE LOCAL FAIR RENTAL VALUE TO TAKE INTO CONSIDERATION FACTORS SUCH AS ABNORMAL CONDITIONS CAUSED BY FLOOD, DROUGHT, OR OTHER CAUSES, SO AS NOT TO WORK A HARDSHIP ON THE PRODUCER IN CASES WHERE SUCH CONDITIONS OCCURRED DURING THE 5-YEAR PERIOD INVOLVED, THERE APPEARS A REASONABLE BASIS FOR SUCH ACTION.

IN VIEW OF THE FOREGOING WE WOULD HAVE NO OBJECTION TO THE ISSUANCE OF REGULATIONS, IN CONNECTION WITH ESTABLISHING THE LOCAL FAIR RENTAL VALUE OF LAND PLACED IN THE CONSERVATION RESERVE PROGRAM, WHICH WOULD ALLOW YOUR DEPARTMENT TO MAKE ADJUSTMENTS IN THE PRODUCTION HISTORY OF SUCH LAND FOR ABNORMAL CONDITIONS CAUSED BY FLOOD, DROUGHT, OR OTHER CAUSES, IN ORDER TO PREVENT HARDSHIP, PROVIDED THE REGULATIONS SET FORTH ADEQUATE CRITERIA FOR MAKING SUCH ADJUSTMENTS.