"REPORTS AND RECORDS

"SEC. 379h. This section shall apply to processors of wheat, warehousemen and exporters of wheat and food products, and all persons purchasing, selling, or otherwise dealing in wheat marketing certificates. Any such person shall, from time to time on request of the Secretary, report to the Secretary such information and keep such records as the Secretary finds to be necessary to enable him to carry out the provisions of this subtitle. Such information shall be reported and such records shall be kept in such manner as the Secretary shall prescribe. For the purpose of ascertaining the correctness of any report made or record kept, or of obtaining information required to be furnished in any report, but not so furnished, the Secretary is hereby authorized to examine such books, papers, records, accounts, correspondence, contracts, documents, and memorandums as he has reason to believe are relevant and are within the control of such person.

"PENALTIES

"SEC. 379i. (a) Any person who violates or attempts to violate or who participates or aids in the violation of any of the provisions of subsection (b) of section 379d of this Act shall forfeit to the United States a sum equal to two times the face value of the marketing certificates involved in such violation. Such forfeiture shall be recoverable in a civil action brought in the name of the United States.

"(b) Any person, except a producer in his capacity as a producer, who violates or attempts to violate or who participates or aids in the violation of any provision of this subtitle, or of any regulation, governing the acquisition, disposition, or handling of marketing certificates or who fails to make any report or keep any record as required by section 379h shall be deemed guilty of a misdemeanor and upon conviction thereof shall be subject to a fine of not more than $5,000 for each violation.

"(c) Any person who, in his capacity as a producer, knowingly violates or attempts to violate or participates or aids in the violation of any provision of this subtitle, or of any regulation, governing the acquisition, disposition, or handling of marketing certificates or fails to make any report or keep any record as required by section 379h shall, (i) forfeit any right to receive marketing certificates, in whole or in part as the Secretary may determine, with respect to the farm or farms and for the marketing year with respect to which any such act or default is committed, or (ii), if such marketing certificates have already been issued, pay to the Secretary, upon demand, the amount of the face value of such certificates, or such part thereof as the Secretary may determine. Such determination by the Secretary with respect to the amount of such marketing certificates to be forfeited or the amount to be paid by such producer shall take into consideration the circumstances relating to the act or default committed and the seriousness of such act or default.

"(d) Any person who falsely makes, issues, alters, forges, or counterfeits any marketing certificate, or with fraudulent intent possesses, transfers, or uses any such falsely made, issued, altered, forged, or counterfeited marketing certificate, shall be deemed guilty of a felony and upon conviction thereof shall be subject to a fine of not more than $10,000 or imprisonment of not more than ten years, or both.

"REGULATIONS

"SEC. 379j. The Secretary shall prescribe such regulations as may be necessary to carry out the provisions of this subtitle including but not limited to regulations governing the acquisition, disposition, or handling of marketing certificates."

SEC. 325. The Agricultural Act of 1949, as amended, is amended as follows: (1) By inserting after section 106 the following new section: "SEC. 107. Not withstanding the provisions of section 101 of this Act, beginning with the 1964 crop

"(1) price support for wheat accompanied by marketing certificates shall be at such level not less than 65 per centum or more than 90 per centum of the parity price therefor as the Secretary determines appropriate taking into consideration the factors specified in section 401 (b),

"(2) if marketing quotas are in effect for wheat price support for wheat not accompanied by marketing certificates shall be at such level as the Secretary determines appropriate taking into consideration competitive world prices of wheat, the feeding value of wheat in relation to feed grains, and the level at which price support is made available for feed grains,

"(3) price support shall be made available only to cooperators; and if a commercial wheat-producing area is established for such crop, price support shall be made available only in the commercial wheat-producing area, "(4) the level of price support for any crop of wheat for which a national marketing quota is not proclaimed or for which marketing quotas have been disapproved by producers shall be as provided in section 101, and "(5) if marketing quotas are in effect for the crop of wheat, a 'cooperator' with respect to any crop of wheat produced on a farm shall be a producer who (i) does not knowingly exceed (A) the farm acreage allotment for wheat or any other commodity on the farm or (B) except as the Secretary may by regulation prescribe, the farm acreage allotment on any other farm for any commodity in which he has an interest as a producer, and (ii) complies with the land-use requirements of section 339 of the Agricultural Adjustment Act of 1938, as amended, to the extent prescribed by the Secretary. If marketing quotas are not in effect for the crop of wheat, a 'cooperator' with respect to any crop of wheat produced on a farm shall be a producer who does not knowingly exceed the farm acreage allotment for wheat. No producer shall be deemed to have exceeded a farm acreage allotment for wheat if the entire amount of the farm marketing excess is delivered to the Secretary or stored in accordance with applicable regulations to avoid or postpone payment of the penalty, but the producer shall not be eligible to receive price support on such marketing excess. No producer shall be deemed to have exceeded the farm acreage allotment for wheat on any other farm, if such farm is exempt from the farm marketing quota for such crop under section 335."

(2) By changing the period at the end of the third sentence in section 407 to a colon and adding the following: "Provided, That if a wheat marketing allocation program is in effect, the current support price for wheat shall be the support price for wheat accompanied by marketing certificate and wheat sold shall be accompanied by a marketing certificate." SEC. 326. Notwithstanding any other provision of law, performance rendered in good faith in reliance upon action or advice of an authorized representative of the Secretary may be accepted as meeting the requirements of subsections (c), (d), and (g) of section 16 of the Soil Conservation and Domestic Allotment Act, as amended, or of section 307 of the Food and Agriculture Act of 1962, section 339 of the Agricultural Act of 1938, as amended, or of section 124 of the Agricultural Act of 1961, and payment may be made therefor in accordance with such action or advice to the extent the Secretary deems it desirable in order to provide fair and equitable treatment.

SEC. 327. In the establishment of State, county, and farm acreage allotments for wheat under the Agricultural Adjustment Act of 1938, as amended, the acreage which is determined under regulations of the Secretary to have been diverted from the production of wheat under the special programs formulated pursuant to section 307 of this Act, section 339 of the Agricultural Adjustment Act of 1938, as amended, and section 124 of the Agricultural Act of 1961, shall be credited to the State, county, and farm as though such acreage had actually been devoted to the production of wheat.

SEC. 328. Effective with the 1964 crop, during any year in which an acreage diversion program is in effect for feed grains, the Secretary shall, notwithstanding any other provision of law, permit producers of feed grains to have acreage devoted to the production of feed grains considered as devoted to the production of wheat and producers of wheat to have acreage devoted to the production of wheat considered as devoted to the production of feed grains to such extent and subject to such terms and conditions as the Secretary determines will not impair the effective operation of the program for feed grains or wheat.

AN EXPLANATION OF THE 1964 WHEAT PROGRAM

(U.S. Department of Agriculture)

The marketing quota referendum on the 1964 wheat crop offers wheatgrowers an opportunity to approve a program that will make progress toward solving wheat problems that have been troublesome almost constantly since World War I.

If approved by wheatgrowers in the referendum to be held on May 21, 1963, the program will have the following results:

1. Maintain farmers' wheat income at about the level of the past 2 years. 2. Permit an orderly reduction of the tremendous supply of wheat already on hand from previous crops. (We have 1.2 billion bushels on hand now; 600 to 700 million bushels is considered an adequate reserve.)

3. Provide for fair wheat prices to both producer and consumer.

4. Prevent acreage diverted out of wheat production from being used to overproduce other crops.

5. Reduce Government costs for a wheat program.

WHY IS WHEAT IN TROUBLE?

Under the wheat program that has been available since 1938, the smallest acreage that could be set as the national wheat allotment was 55 million acres. During the 5-year period, 1934 through 1938, the average yield of wheat of the United States was 12.8 bushels an acre. Today, the national average yield is about 25 bushels per acre, double what it was back when the minimum acreage allotment was set by law. Therefore, a national allotment that could not be set any lower than 55 million acres had been producing more wheat than could be used in the United States and exported.

In addition, the old program permitted any farm to grow up to 15 acres of wheat even when marketing quotas were in effect. The acres taken out of wheat production could be used for the production of feed grains and other crops. The extra acres of feed grains added to the already heavy supplies of those grains.

The carryover of wheat from previous crops when the 1962 marketing year began was 1.3 billion bushels. That carryover is about equal to the best year of record for domestic use and exports-it is twice the size of carryover considered adequate for national security and insurance against a short crop.

The United States now averages about 600 million bushels for our own use. We also export about 600 million bushels.

Most of the huge supply of wheat is owned by the Federal Government. The production from a national wheat allotment of 55 million acres and the 15-acre exemption has been larger than the market would take. The wheat not needed for domestic use or export was added to the Government inventory.

The cost of the wheat program, counting export costs, in 1953 was $194 million. By 1961 the program cost was up to $1.5 billion-seven times the 1953 cost-60 percent of the wheat income for that year.

THE PROGRAM IN BRIEF

The program being voted on in the May 21 referendum provides for

1. Farm allotments equal to about 90 percent of the 1963 allotment on the average -a national allotment of 49.5 million acres.

2. A national marketing quota of 1.2 billion bushels.

3. Payment for diversion from wheat to conservation uses as a result of complying with 1964 wheat allotment.

4. An opportunity for each wheatgrower to voluntarily reduce below his allotment and devote the acreage to conservation. This acreage would also be eligible for diversion payments.

5. A two-price arrangement whereby most of each participating grower's wheat would be eligible for price support at $2 a bushel and the balance at $1.30 a bushel on a national average basis.

MARKETING QUOTA PROCLAMATION

The Food and Agriculture Act of 1962 directs the Secretary of Agriculture to proclaim a national marketing quota for wheat whenever he finds that the total supply of wheat will be excessive at the beginning of the marketing year for the crop of wheat for which the quota is proclaimed.

On March 29, 1963, the Secretary proclaimed a national marketing quota of 1,220 million bushels and a national wheat acreage allotment of 49.5 million acres. The required referendum will be held on May 21, 1963.

If at least two-thirds of the wheatgrowers voting in the referendum approve marketing quotas, the program will be in effect.

CHANGES IN THE MARKETING QUOTA AND ALLOTMENT

The program to be voted on in the referendum removes the minimum 55million-acre national allotment and replaces it with a minimum bushelage quota-called the national marketing quota-which cannot be smaller than 1 billion bushels. At least two-thirds of wheatgrowers voting in the referendum must approve marketing quotas before the program can be put in effect. The national marketing quota for 1964 has been set at 1,220 million bushels. With a national allotment of 49.5 million acres and allowances for small farm allotments, over plantings of allotments, estimated voluntary, diversion of wheat acres and abandonment, it is expected that the harvested acreage would be about 41 million acres with an expected production of 1,060 million bushels. A crop of this size would permit 165 million bushels to be marketed from the Federal Government inventory.

THE NATIONAL MARKETING QUOTA AND FARM ALLOTMENTS

With the national marketing quota converted to the national acreage allotment of 49.5 million acres, each wheat-producing State will be apportioned a State wheat allotment based on the average acreage of wheat in the State for the preceding 10 years, adjusted for trends and allowing credit for diversion. Similarly, each county in a State is then assigned a county wheat allotment based on the 10-year average wheat acreage in the county. Farm wheat allotments will be determined on the basis of the farm wheat history acreage (including acreage diverted from wheat) for the past 5 years, with some adjustment for change in farming practices, type of soil, and topography.

Before the referendum, wheatgrowers will receive from their ASC county committee an official notice of the wheat allotment acreage assigned to their farm. At the same time producers will receive a notice of the normal wheat yield for their farms.

DIVERSION ACREAGE PAYMENT AT 30 PERCENT OF SUPPORT

The law authorizes the Secretary of Agriculture to make diversion payments to wheat producers who stay within their farm allotments and add to the normal conserving acreage for the farm the acreage diverted from wheat. The diversion payments are to help maintain wheat income while the carryover of wheat is being reduced.

The number of acres on which the diversion payment will be made is the difference between the 1964 wheat allotment and what the allotment would have been with a national allotment of 55 million acres. This is done in ASC county offices by multiplying the 1964 allotment for the farm by 11.11 percent. For example: If the farm allotment for 1964 is 54 acres, the wheat acres to be diverted to conservation use would be 11.11 percent times 54, or 6 acres. (Thus this farm is eligible for a diversion payment if 54 acres are seeded to wheat and the acres for conserving use are increased by 6.)

The payment per acre for this diversion is the farm normal yield multiplied by 30 percent of the county support price rate based on the $2 national average. The diversion payment for the farm is the rate per acre times the number of acres diverted from wheat. Using the national average support rate, for example, the per-acre payment rate for a farm with a normal yield of 25 bushels would be determined as follows: 30 percent of $2 equals $0.60-25 bushels times $0.60 equals $15.00-farm diversion payment rate per acre and the payment for the farm would be 6 acres times $15 equals $90 diversion payment. In addition to the diversion payment, the producer on this farm would be eligible for the price-support loan and wheat certificates, if the diverted acreage is in addition to the normal conserving base for the farm.

VOLUNTARY DIVERSION BELOW ALLOTMENT-PAYMENT 50 PERCENT OF SUPPORT The program also offers a diversion payment for a voluntary diversion of part of the 1964 wheat allotment for conservation uses. The largest number of acres for which the voluntary diversion payment will be made is 20 percent of the 1964 allotment or an acreage which will bring the total farm diversion to 15. (There are special provisions for farms with allotments of less than 15 acres—see p. 1.)

Using the above illustration of a farm with an allotment of 54 acres, the additional wheat acres that could be diverted will be 20 percent of 54 acres, or 10.8

acres.

The payment per acre on the additional voluntary diversion is based on 50 percent of the county price-support rate. In the example case, the payment rate per acre for the farm would be 50 percent of $2 ($1) multiplied by the normal yield of 25 bushels for the farm, or $25. If the 10.8 acres figured above are diverted the payment for voluntary diversion would be 10.8X $25-$270.

SUMMARY OF DIVERSION PAYMENTS

1. Diversion by staying within the 1964 allotment: 6 acres at $15 per acre-2. Voluntary diversion below allotted acres: 10.8 acres at $25--

Total diversion payment----

$90 270

360

If the farm operator earns the total diversion payment in this case, he would seed 43.2 acres of wheat (54-10.8=43.2) and increase his acres devoted to conserving uses by 16.8 acres (6+10.8) and would be eligible for a price-support loan, a diversion payment, and certificates.

ADVANCE PAYMENTS

Upon request, a producer may receive in advance 50 percent of the total payment being earned for diversion of wheat land to conservation uses.

MARKETING CERTIFICATES

The program provides for the Secretary to issue marketing certificates to wheat producers for their share of the wheat needed for domestic food and for a part of the exports. For 1964, 975 million bushels of wheat will be eligible for marketing certificates. Certificates issued to participants who grow their entire allotment will be 80 percent of the normal production of the farm allotment; for participants who voluntarily reduce 20 percent below their allotment-100 percent of the normal production of the acreage planted to wheat.

Using for illustration the farm with a 54-acre allotment, the certificates would apply as follows: The normal yield per acre is 25 bushels. Therefore, the normal production for the 54-acre allotment would be 1,350 bushels. Certificates issued for that farm would be for 80 percent of 1,350 bushels, or 1,080 bushels. If, on this farm, the operator voluntarily diverted all the wheat acres he could for diversion payment-16.8 acres-and planted only the remainder of the farm allotment to wheat he would receive certificates for the same number of bushels-1,080 bushels. With 20 percent of the allotment diverted, the certificates issued would be for a number of bushels equal to the normal production of all the wheat acreage seeded on the farm. If the yield is below normal or even if the crop is a complete failure, the producer will be able to take his unused certificates to the county ASC office and get 70 cents for each bushel they represent.

However, if the acres planted to wheat for 1964 are less than 80 percent of the farm allotment, certificates would be issued for the normal production of the acres actually planted. If a producer has marketing quota excess wheat from former crops stored under bond, he may plant less than 80 percent of his allotment and use some of the stored wheat for his certificates.

HANDLING OF THE CERTIFICATES

Each participating producer will receive from the ASC county office a marketing quota card indicating his wheat is free from marketing quota penalty and showing the number of bushels of certificated wheat for his farm.

The first buyer will record on the marketing card the number of bushels purchased by him and the number of bushels of certificated wheat remaining unsold. The first buyer would periodically report his purchases to the U.S. Department of Agriculture and receive credit for the certificates.

PRICE SUPPORTS

Certificated wheat will be eligible for a loan at the county support rate based on a national average rate of $2 a bushel and noncertificated wheat will be supported at the county support rate based on $1.30 a bushel national average. Differentials will be established for location, class, and grade.