B-129167, AUG. 26, 1957

B-129167, AUG. 26, 1957

TO THE SECRETARY OF AGRICULTURE:

ON AUGUST 9, 1957, THE ASSISTANT SECRETARY OF AGRICULTURE, MARVIN L. MCLAIN, REQUESTED OUR DECISION CONCERNING THE MEANING OF THE WORD "PRODUCER" AS USED IN THE LIMITATION ON THE FUNDS MADE AVAILABLE FOR THE ACREAGE RESERVE PROGRAM UNDER THE SOIL BANK ACT, CONTAINED IN THE DEPARTMENT OF AGRICULTURE AND FARM CREDIT ADMINISTRATION APPROPRIATION ACT, 1958, PUBLIC LAW 85-118, APPROVED AUGUST 2, 1957, 71 STAT. 338. THE APPROPRIATION LIMITATION INVOLVED, IN PERTINENT PART, READS AS FOLLOWS:

"PROVIDED FURTHER, THAT NO PART OF THIS APPROPRIATION SHALL BE USED TO FORMULATE AND ADMINISTER AN ACREAGE RESERVE PROGRAM WHICH WOULD RESULT * * * IN TOTAL COMPENSATION BEING PAID TO ANY ONE PRODUCER IN EXCESS OF $3,000 WITH RESPECT TO THE 1958 CROPS.'

SUBTITLE A, TITLE I OF THE SOIL BANK ACT, PUBLIC LAW 540, APPROVED MAY 28, 1956, 70 STAT. 188, 189, PROVIDES THAT UNDER THE ACREAGE RESERVE PROGRAM PRODUCERS SHALL BE COMPENSATED FOR REDUCING THEIR ACREAGE OF CERTAIN BASIC COMMODITIES BELOW THEIR FARM ACREAGE ALLOTMENTS OR FARM BASE ACREAGE. SECTION 105 (A) OF THE ACT PROVIDES THAT THE RATE OF COMPENSATION PAYABLE TO PRODUCERS FOR PARTICIPATION IN THE PROGRAM SHALL BE AT SUCH RATE OR RATES AS THE SECRETARY OF AGRICULTURE DETERMINES WILL PROVIDE PRODUCERS WITH A FAIR AND REASONABLE RETURN FOR REDUCING THEIR ACREAGE. SECTION 124 AUTHORIZES THE SECRETARY TO PRESCRIBE SUCH REGULATIONS AS HE DETERMINES NECESSARY TO CARRY OUT THE PROGRAM.

YOUR DEPARTMENT TAKES THE POSITION THAT THE CONGRESS INTENDED THE $3,000 LIMITATION TO APPLY TO EACH PRODUCER WITH RESPECT TO A PARTICULAR FARMING UNIT, RATHER THAN TO OPERATE AS A CEILING ON THE AMOUNT OF COMPENSATION THAT CAN BE PAID TO HIM FOR ALL FARMS IN WHICH HE MAY HAVE AN INTEREST. THE EFFECT OF THE CONSTRUCTION CONTENDED FOR IS TO APPLY THE LIMITATION TO EACH FARM SEPARATELY SO THAT A PRODUCER HAVING AN INTEREST, FOR EXAMPLE, IN THREE SEPARATE FARMS COULD RECEIVE AS MUCH AS $3,000 FOR EACH FARM OR A TOTAL OF NOT TO EXCEED $9,000. THE LETTER SETS FORTH SEVERAL OTHER EXAMPLES OF PAYMENTS, SO FAR AS CONCERNS SUCH INTERPRETATION OF THE LIMITATION, AS AN AID IN OUR DETERMINATION OF THE MATTER.

IN SUPPORT OF THAT POSITION THE DEPARTMENT POINTS OUT THAT WHILE THE ENABLING ACT CONTAINS NO STATUTORY DEFINITION OF THE TERM "PRODUCER" THE ADMINISTRATIVE REGULATIONS GOVERNING THE 1956 AND 1957 ACREAGE RESERVE PROGRAMS, AS WELL AS THE CONSERVATION RESERVE PROGRAM (SUBTITLE B) DEFINES IT TO MEAN ANY PERSON WHO IS AN OWNER OR A LANDLORD, CASH TENANT, STANDING -RENT TENANT, FIXED-RENT TENANT, SHARE TENANT OR SHARE-CROPPER. ALSO, THAT A SIMILAR DEFINITION IS CONTAINED IN THE REGULATIONS ON THE AGRICULTURAL CONSERVATION PROGRAM, THE PRICE SUPPORT PROGRAMS, AND THE ACREAGE ALLOTMENT AND MARKETING QUOTA PROGRAMS. UNDER THAT DEFINITION, THE DEPARTMENT CONTENDS THAT IT IS NECESSARY TO LOOK TO EACH FARMING UNIT TO DETERMINE WHETHER A PERSON IS A PRODUCER, AND THAT THE TERM PRODUCER HAS NO MEANING THEREUNDER EXCEPT AS IT RELATES TO A PARTICULAR FARM. THE WORD ,FARM" IS DEFINED IN THE REFERRED-TO REGULATIONS AS MEANING ALL ADJACENT OR NEARBY FARM OR RANGELAND UNDER THE SAME OWNER WHICH IS OPERATED BY ONE PERSON. THUS, THE ASSISTANT SECRETARY EXPRESSES THE VIEW THAT THE CONGRESS, IN ADOPTING THE PROVISION IN QUESTION, HAD IN MIND THE DEFINITION OF THE WORDS "PRODUCER" AND "FARM" AS USED IN THE 1956 AND 1957 ACREAGE RESERVE PROGRAMS AND OTHER AGRICULTURAL PROGRAMS AND INTENDED THAT THE $3,000 LIMITATION APPLY TO EACH SUCH PRODUCER ON EACH SUCH FARMING UNIT.

IN FURTHER SUPPORT OF THIS VIEW, THE ASSISTANT SECRETARY QUOTES THE FOLLOWING STATEMENTS MADE ON THE FLOOR OF THE SENATE (CONG. RECORD DATED AUGUST 1, 1957, PAGE 12105) BY SENATOR MUNDT, ONE OF THE CONFEREES OF THE COMMITTEE OF CONFERENCE ON THE DEPARTMENT OF AGRICULTURE APPROPRIATION BILL, 1958, AND CONCURRED IN BY SENATOR RUSSELL, SPOKESMAN FOR THE MANAGERS ON THE PART OF THE SENATE, DURING CONSIDERATION OF THAT PART OF THE REPORT OF THE COMMITTEE OF CONFERENCE RELATING TO THE LIMITATION IN QUESTION.

" "WHAT WE WERE TRYING TO DO . . . WAS TO ESTABLISH A CEILING TO AVOID UNDULY LARGE PAYMENTS TO A SINGLE FARM OPERATION.

" "SO I THINK IT SHOULD BE ESTABLISHED IN THE RECORD HERE AND NOW THAT WHAT WE HAD IN MIND IN CONFERENCE WAS REALLY A $3,000 LIMITATION ON A SINGLE FARM OPERATION OR ON A SINGLE FARM; THAT IT IS THE PRODUCER WE HAVE IN MIND, RATHER THAN A FARM OWNER WHO MIGHT OWN SEVERAL FARMS. IN MY OWN STATE OF SOUTH DAKOTA, FREQUENTLY THERE ARE WIDOWS WHO SUPPORT THEMSELVES FROM THE INCOME OF 2, 3, OR 4 PIECES OF PROPERTY WHICH THEY RENT ON SHARES TO DIFFERENT TENANTS.

" "I SHOULD LIKE TO ESTABLISH WITH THE CHAIRMAN OF THE SENATE SUBCOMMITTEE ON AGRICULTURAL APPROPRIATIONS THE FACT THAT WE WERE NOT TRYING TO DISCRIMINATE AMONG TENANTS; WE WERE THINKING IN TERMS OF THE PRODUCER, AS THAT WORD APPLIES TO THE OPERATOR OF A SINGLE FARM, RATHER THAN TO THE INDIVIDUAL WHO MIGHT OWN SEVERAL FARMS, AND THEREBY, BY WORKING OUT SOME ACREAGE RESERVE CONTRACT WITH ONE TENANT FARMER, PRECLUDE HIMSELF FROM PARTICIPATING WITH OTHER TENANTS ON DIFFERENT FARMS TO THE DISADVANTAGE OF THOSE OTHER TENANTS.'"

THE PRIMARY QUESTION HERE INVOLVED IS WHETHER THE LIMITATION QUOTED ABOVE ON THE USE OF FUNDS MADE AVAILABLE TO THE DEPARTMENT OF AGRICULTURE TO CARRY OUT THE ACREAGE RESERVE PROGRAM OF THE SOIL BANK ACT INHIBITS YOUR DEPARTMENT, DURING THE FISCAL YEAR 1958, FROM PAYING "TO ANY ONE PRODUCER IN EXCESS OF $3,000 WITH RESPECT TO THE 1958 CROPS.' OF COURSE, THERE CAN BE NO MORE CONVINCING EVIDENCE OF THE PURPOSE OF A STATUTE THAN THE WORDS BY WHICH THE LEGISLATURE UNDERTAKES TO GIVE EXPRESSION TO ITS WISHES; AND, ON FIRST EXAMINATION OF THE PROVISION, THERE WOULD APPEAR TO BE NO DOUBT THAT PAYMENTS TO ANY ONE PRODUCER AGGREGATING IN EXCESS OF $3,000 REGARDING THE 1958 CROPS WOULD BE CONTRARY TO THE RESTRICTION AND, THEREFORE, LEGALLY IMPROPER.

HOWEVER, IN VIEW OF THE CONTENTION OF YOUR DEPARTMENT THAT SUCH AN INTERPRETATION OF THE LIMITATION WOULD OPERATE TO PREVENT IT FROM OBTAINING SUFFICIENT PARTICIPATION IN THE ACREAGE RESERVE PROGRAM TO ACHIEVE THE ACREAGE RESERVE GOALS FOR THE MAJOR COMMODITIES COVERED BY THE SOIL BANK ACT, A RESULT CERTAINLY NOT INTENDED BY THE CONGRESS; AND IN THE LIGHT OF THE ARGUMENTS AND EVIDENCE ADVANCED TO SUPPORT THE DEPARTMENT'S POSITION ON THE MATTER, WE HAVE CAREFULLY EXAMINED THE LEGISLATIVE HISTORY OF THE ENABLING LEGISLATION AS WELL AS THE APPROPRIATION LIMITATION HERE INVOLVED IN ORDER TO ASCERTAIN THE CONGRESSIONAL INTENT OF THE PROVISO.

AS INDICATED BY THE ASSISTANT SECRETARY THE SOIL BANK ACT DOES NOT ITSELF DEFINE "PRODUCER" BUT IT IS CLEAR FROM THE TEXT THAT THE TERM IS USED TO DENOTE A PERSON WHO RAISES AGRICULTURAL CROPS AND PUTS THEM IN A CONDITION FOR MARKET. SEE SANCHO V. BOWIE, 93 F.2D 323, 326. AS THUS USED THE TERM CLEARLY IS NOT LIMITED TO LAND OWNERS BUT COMPREHENDS IN ADDITION, TENANTS AND SHARECROPPERS AS DEFINED IN THE REFERRED-TO ADMINISTRATIVE REGULATIONS. IF ANY FURTHER SUPPORT FOR THIS VIEW IS NEEDED, IT MAY BE FOUND IN THE PROVISIONS OF SECTION 122 OF THE ACT, 70 STAT. 197, WHEREIN THE SECRETARY OF AGRICULTURE IS DIRECTED TO PROVIDE ADEQUATE SAFEGUARDS TO PROTECT THE INTERESTS OF TENANTS AND SHARECROPPERS IN RESPECT OF PAYMENTS MADE UNDER THE ACREAGE RESERVE PROGRAM.

UNDER THIS DESCRIPTION OF "PRODUCER" THERE REMAINS FOR CONSIDERATION WHETHER THE CONGRESS INTENDED, BY THE PROVISO IN QUESTION, TO LIMIT THE AMOUNT OF COMPENSATION PAYABLE TO HIM FOR ALL FARMS IN WHICH HE MAY HAVE AN INTEREST, OR WHETHER IT WAS INTENDED TO LIMIT THE COMPENSATION PAYBLE TO PRODUCERS FOR A SINGLE FARM OPERATION.

THE PROVISO WAS FIRST INTRODUCED AS AN AMENDMENT TO THE CITED APPROPRIATION ON THE FLOOR OF THE HOUSE BY REPRESENTATIVE REUSS. SEE CONG. RECORD, MAY 15, 1957, PAGES 6182, 6183. THE AMOUNT OF THE LIMITATION, NAMELY, $5,000 WAS CHANGED TO $2,500 ON AMENDMENT OF REPRESENTATIVE ABBITT, AND, AS AMENDED, WAS AGREED TO AND PASSED. THE FOLLOWING STATEMENT BY REPRESENTATIVE REUSS, QUOTED FROM PAGE 6183, SUMMARIZES THE ATTITUDE OF THE HOUSE OF REPRESENTATIVES ON THE DEBATE OF THE PROVISO.

"AS THE REPORT OF THE COMMITTEE ON APPROPRIATIONS AT PAGE 26 WELL STATES: THE PRINCIPAL JUSTIFICATION FOR THE ACREAGE-RESERVE PROGRAM IS TO RESTORE TO THE FARMER SOME OF THE INCOME HE HAS LOST THROUGH REDUCED PRICES AND ACREAGE.

"NOW, THIS $5,000 LIMITATION TO ANY ONE FARM PRODUCER MEANS THAT GOVERNMENT HELP WILL GO WHERE IT IS NEEDED, NOT WHERE IT IS NOT NEEDED. AID TO THE LARGE-SCALE COMBINATION PRODUCER SIMPLY INCREASES THE TENDENCY AWAY FROM THE FAMILY-SIZED FARM, A TENDENCY WHICH HAS ALREADY GONE MUCH TOO FAR. * * *.'

THE SENATE COMMITTEE ON APPROPRIATIONS IN REPORTING OUT THE BILL INCREASED THE AMOUNT OF THE LIMITATION TO $5,000. THE COMMITTEE OF CONFERENCE SETTLED ON $3,000 WHICH WAS AGREED TO AND PASSED BY BOTH HOUSES. THE ABOVE-QUOTED STATEMENTS BY SENATOR MUNDT REFLECT THE ATTITUDE OF THE SENATE ON THE APPLICATION OF THE PROVISO.

THUS, THE LEGISLATIVE HISTORY OF THE PROVISO DISCLOSES THAT THE CONGRESS, IN DECIDING UPON THE $3,000 ACREAGE RESERVE PAYMENT CEILING TO PRODUCERS, THEREBY INTENDED TO DISCONTINUE THE LARGE PAYMENTS MADE TO A SINGLE FARM OPERATION WITHOUT IN ANY WAY DISCRIMINATING AGAINST FARM TENANT OPERATORS. SUCH BEING THE CASE THE LIMITATION MAY BE GIVEN EFFECT ONLY BY REGARDING IT AS APPLICABLE TO A SINGLE FARM OPERATION AND EACH OPERATOR THEREOF.

IN VIEW OF THE FOREGOING COMMENTS, YOU ARE ADVISED THAT WE CONCUR IN THE UNDERSTANDING OF YOUR DEPARTMENT THAT THE CONGRESS CONSIDERED THE APPLICABILITY OF THE $3,000 LIMITATION TO EACH PRODUCER REGARDING A PARTICULAR FARMING UNIT, RATHER THAN AS A CEILING ON THE AMOUNT OF COMPENSATION THAT CAN BE PAID TO HIM FOR ALL FARMS IN WHICH HE MAY HAVE AN INTEREST. THE ACREAGE RESERVE PAYMENT ILLUSTRATIONS OUTLINED IN THE LETTER ARE BASED UPON THIS UNDERSTANDING AND APPEAR UNOBJECTIONABLE.