7 USC 4002: Alcohol processor grain reserve program
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7 USC 4002: Alcohol processor grain reserve program Text contains those laws in effect on June 18, 2024

§4002. Alcohol processor grain reserve program

(a) Definitions

As used in this section-

(1) The term "Secretary" means the Secretary of Agriculture.

(2) The term "processor" means any person engaged within the United States in the business of manufacturing grain into alcohol for use as a fuel either by itself or in combination with some other product.

(3) The terms "agricultural grain" and "grain" mean any agricultural commodity (A) that is suitable for processing into alcohol for use as a fuel, and (B) with respect to which a price support operation is in effect.

(4) The term "producer storage program" means the producer storage program provided for under section 1445e 1 of this title.

(5) The term "small scale biomass energy project" shall have the same meaning as defined in section 8802(19) of title 42.

(b) Loans on stored grain; processors eligible

To assist processors in obtaining a dependable supply of grain at reasonable prices, the Secretary may formulate and administer a program under which processors purchasing and storing grain needed by them for manufacturing into alcohol for use as a fuel may obtain a loan from the Secretary on such grain. Loans under this section may be made available only to processors that (1) operate small scale biomass energy projects financed in whole or in part by the United States Government or any agency thereof, and (2) as determined by the Secretary, are otherwise unable to obtain a dependable supply of grain at reasonable prices for use in such projects.

(c) Terms and conditions of processor grain reserve program and producer storage program

Except as otherwise provided in this section, loans made under this section to carry out the processor grain reserve program may be made on the same terms and conditions as loans made to carry out the producer storage program.

(d) Amount of loan

The amount of the loan that the Secretary may make to an eligible processor at any time on any quantity of grain purchased by the processor shall be determined by multiplying the price support loan rate in effect for such grain at the time the loan is made times the quantity of grain purchased by the processor. The quantity of grain on which one or more loans may be outstanding at any time in the case of any processor may not exceed the estimated quantity of grain needed by such processor for one year of operation.

(e) Replacement of removed grain

Whenever any quantity of grain stored in the processor grain reserve under this section is removed from storage by a processor, the processor may be required to replace such grain with an equal quantity, within such period of time as the Secretary shall prescribe by regulation, or repay that portion of the loan represented by the quantity of grain removed from storage.

(f) Purposes for which grain to be used

Grain on which an eligible processor has received a loan under this section may not be used for any purpose other than the manufacture of alcohol for use as a fuel, and the Secretary shall establish such safeguards as the Secretary deems necessary to assure that such grain is not used for any other purpose and is not used in any manner that would unduly depress, manipulate, or curtail the free market in such grain.

(g) Terms and conditions of loan; security; nonrecourse loans

Loans made under this section shall be made subject to such terms and conditions and subject to such security as the Secretary deems appropriate, except that such loans may not be made as nonrecourse loans.

(h) Payment for cost of storage; repayment of loans

In carrying out the processor grain reserve program under this section, the Secretary may-

(1) provide for the payment to processors of such amounts as the Secretary determines appropriate to cover the cost of storing grain held in the processor grain reserve, except that in no event may the rate of the payment paid under this clause for any period exceed the rate paid by the Secretary under the producer storage program for the same period; and

(2) prescribe conditions under which the Secretary may require processors to repay loans made under this section, plus accrued interest thereon, refund amounts paid to the processors for storage, and require the processors to pay such additional interest and other charges as may be required by regulation in the event any processor fails to abide by the terms and conditions of the loan or any regulation prescribed under this section.

(i) Announcement of terms and conditions of program

The Secretary shall announce the terms and conditions of the processor grain reserve program as far in advance of making loans as practicable.

(j) Use of Commodity Credit Corporation facilities

The Secretary may use the facilities of the Commodity Credit Corporation to carry out this section.

(k) Authorization of appropriations; appropriation acts as determining amount and extent of loans; expiration of authority to make loans

There are authorized to be appropriated such sums as may be necessary to carry out this section. Any loans made under this section shall be made to such extent and such amounts as provided in appropriation Acts. The authority to make loans under this section shall expire five years after December 3, 1980.

( Pub. L. 96–494, title II, §209, Dec. 3, 1980, 94 Stat. 2575 .)

Editorial Notes

References in Text

The producer storage program provided for under section 1445e of this title, referred to in subsec. (a)(4), refers to section 1445e prior to the general amendment of such section by Pub. L. 101–624, title XI, §1123, Nov. 28, 1990, 104 Stat. 3503 . As amended, section 1445e now provides for a farmer owned reserve program.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective Dec. 3, 1980, see section 213 of Pub. L. 96–494, set out as a note under section 4001 of this title.

1 See References in Text note below.