Farm Energy

Section 9011        Biomass Crop Assistance Program.

 (a) Definitions– In this section:

(1) BCAP– The term ‘BCAP’ means the Biomass Crop Assistance Program established under this section.

(2) BCAP PROJECT AREA– The term ‘BCAP project area’ means an area that–

(A) has specified boundaries that are submitted to the Secretary by the project sponsor and subsequently approved by the Secretary;

(B) includes producers with contract acreage that will supply a portion of the renewable biomass needed by a biomass conversion facility; and

(C) is physically located within an economically practicable distance from the biomass conversion facility.

(3) CONTRACT ACREAGE– The term ‘contract acreage’ means eligible land that is covered by a BCAP contract entered into with the Secretary.

(4) ELIGIBLE CROP–

(A) IN GENERAL– The term ‘eligible crop’ means a crop of renewable biomass.

(B) EXCLUSIONS– The term ‘eligible crop’ does not include–

(i) any crop that is eligible to receive payments under title I of the Food, Conservation, and Energy Act of 2008 or an amendment made by that title; or

(ii) any plant that is invasive or noxious or has the potential to become invasive or noxious, as determined by the Secretary, in consultation with other appropriate Federal or State departments and agencies.

(5) ELIGIBLE LAND-

(A) IN GENERAL– The term ‘eligible land’ includes agricultural and nonindustrial private forest lands (as defined in section 5(c) of the Cooperative Forestry Assistance Act of 1978 (16 U.S.C. 2103a(c))).

(B) EXCLUSIONS– The term ‘eligible land’ does not include–

(i) Federal- or State-owned land;

(ii) land that is native sod, as of the date of enactment of the Food, Conservation, and Energy Act of 2008;

(iii) land enrolled in the conservation reserve program established under subchapter B of chapter 1 of subtitle D of title XII of the Food Security Act of 1985 (16 U.S.C. 3831 et seq.);

(iv) land enrolled in the wetlands reserve program established under subchapter C of chapter 1 of subtitle D of title XII of that Act (16 U.S.C. 3837 et seq.); or

(v) land enrolled in the grassland reserve program established under subchapter D of chapter 2 of subtitle D of title XII of that Act (16 U.S.C. 3838n et seq.).

 (6) ELIGIBLE MATERIAL-

(A) IN GENERAL– The term ‘eligible material’ means renewable biomass.

(B) EXCLUSIONS– The term ‘eligible material’ does not include–

(i) any crop that is eligible to receive payments under title I of the Food, Conservation, and Energy Act of 2008 or an amendment made by that title;

(ii) animal waste and byproducts (including fats, oils, greases, and manure);

(iii) food waste and yard waste; or

(iv) algae.

(7) PRODUCER– The term ‘producer’ means an owner or operator of contract acreage that is physically located within a BCAP project area.

(8) PROJECT SPONSOR– The term ‘project sponsor’ means–

(A) a group of producers; or

(B) a biomass conversion facility.

 

(b) Establishment and Purpose– The Secretary shall establish and administer a Biomass Crop Assistance Program to–

(1) support the establishment and production of eligible crops for conversion to bioenergy in selected BCAP project areas; and

(2) assist agricultural and forest land owners and operators with collection, harvest, storage, and transportation of eligible material for use in a biomass conversion facility.

 

(c) BCAP Project Area–

(1) IN GENERAL– The Secretary shall provide financial assistance to producers of eligible crops in a BCAP project area.

(2) SELECTION OF PROJECT AREAS–

(A) IN GENERAL– To be considered for selection as a BCAP project area, a project sponsor shall submit to the Secretary a proposal that includes, at a minimum–

(i) a description of the eligible land and eligible crops of each producer that will participate in the proposed BCAP project area;

(ii) a letter of commitment from a biomass conversion facility that the facility will use the eligible crops intended to be produced in the proposed BCAP project area;

(iii) evidence that the biomass conversion facility has sufficient equity available, as determined by the Secretary, if the biomass conversion facility is not operational at the time the proposal is submitted to the Secretary; and

(iv) any other appropriate information about the biomass conversion facility or proposed biomass conversion facility that gives the Secretary a reasonable assurance that the plant will be in operation by the time that the eligible crops are ready for harvest.

(B) BCAP PROJECT AREA SELECTION CRITERIA– In selecting BCAP project areas, the Secretary shall consider–

(i) the volume of the eligible crops proposed to be produced in the proposed BCAP project area and the probability that such crops will be used for the purposes of the BCAP;

(ii) the volume of renewable biomass projected to be available from sources other than the eligible crops grown on contract acres;

(iii) the anticipated economic impact in the proposed BCAP project area;

(iv) the opportunity for producers and local investors to participate in the ownership of the biomass conversion facility in the proposed BCAP project area;

(v) the participation rate by–

(I) beginning farmers or ranchers (as defined in accordance with section 343(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1991(a))); or

(II) socially disadvantaged farmers or ranchers (as defined in section 2501(e) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e)));

(vi) the impact on soil, water, and related resources;

(vii) the variety in biomass production approaches within a project area, including (as appropriate)–

(I) agronomic conditions;

(II) harvest and postharvest practices; and

(III) monoculture and polyculture crop mixes;

(viii) the range of eligible crops among project areas; and

(ix) any additional information, as determined by the Secretary.

(3) CONTRACT-

(A) IN GENERAL– On approval of a BCAP project area by the Secretary, each producer in the BCAP project area shall enter into a contract directly with the Secretary.

(B) MINIMUM TERMS– At a minimum, contracts shall include terms that cover–

(i) an agreement to make available to the Secretary, or to an institution of higher education or other entity designated by the Secretary, such information as the Secretary considers to be appropriate to promote the production of eligible crops and the development of biomass conversion technology;

(ii) compliance with the highly erodible land conservation requirements of subtitle B of title XII of the Food Security Act of 1985 (16 U.S.C. 3811 et seq.) and the wetland conservation requirements of subtitle C of title XII of that Act (16 U.S.C. 3821 et seq.);

(iii) the implementation of (as determined by the Secretary)–

(I) a conservation plan; or

(II) a forest stewardship plan or an equivalent plan; and

(iv) any additional requirements the Secretary considers appropriate.

(C) DURATION– A contract under this subsection shall have a term of up to–

(i) 5 years for annual and perennial crops; or

(ii) 15 years for woody biomass.

(4) RELATIONSHIP TO OTHER PROGRAMS– In carrying out this subsection, the Secretary shall provide for the preservation of cropland base and yield history applicable to the land enrolled in a BCAP contract.

(5) PAYMENTS–

(A) IN GENERAL– The Secretary shall make establishment and annual payments directly to producers to support the establishment and production of eligible crops on contract acreage.

(B) AMOUNT OF ESTABLISHMENT PAYMENTS– The amount of an establishment payment under this subsection shall be up to 75 percent of the costs of establishing an eligible perennial crop covered by the contract, including–

(i) the cost of seeds and stock for perennials;

(ii) the cost of planting the perennial crop, as determined by the Secretary; and

(iii) in the case of nonindustrial private forestland, the costs of site preparation and tree planting.

(C) AMOUNT OF ANNUAL PAYMENTS-

(i) IN GENERAL- Subject to clause (ii), the amount of an annual payment under this subsection shall be determined by the Secretary.

(ii) REDUCTION- The Secretary shall reduce an annual payment by an amount determined to be appropriate by the Secretary, if–

(I) an eligible crop is used for purposes other than the production of energy at the biomass conversion facility;

(II) an eligible crop is delivered to the biomass conversion facility;

(III) the producer receives a payment under subsection (d);

(IV) the producer violates a term of the contract; or

(V) there are such other circumstances, as determined by the Secretary to be necessary to carry out this section.

 

(d) Assistance With Collection, Harvest, Storage, and Transportation–

(1) IN GENERAL– The Secretary shall make a payment for the delivery of eligible material to a biomass conversion facility to–

(A) a producer of an eligible crop that is produced on BCAP contract acreage; or

(B) a person with the right to collect or harvest eligible material.

(2) PAYMENTS–

(A) COSTS COVERED– A payment under this subsection shall be in an amount described in subparagraph (B) for–

(i) collection;

(ii) harvest;

(iii) storage; and

(iv) transportation to a biomass conversion facility.

(B) AMOUNT– Subject to paragraph (3), the Secretary may provide matching payments at a rate of $1 for each $1 per ton provided by the biomass conversion facility, in an amount equal to not more than $45 per ton for a period of 2 years.

(3) LIMITATION ON ASSISTANCE FOR BCAP CONTRACT ACREAGE– As a condition of the receipt of annual payment under subsection (c), a producer receiving a payment under this subsection for collection, harvest, storage or transportation of an eligible crop produced on BCAP acreage shall agree to a reduction in the annual payment.

 

(e) Report– Not later than 4 years after the date of enactment of the Food, Conservation, and Energy Act of 2008, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report on the dissemination by the Secretary of the best practice data and information gathered from participants receiving assistance under this section.

(f) Funding- Of the funds of the Commodity Credit Corporation, the Secretary shall use to carry out this section such sums as are necessary for each of fiscal years 2008 through 2012.

 

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 (Excerpt from Managers’ Report follows)

 The Conference substitute establishes a Biomass Crop Assistance Program (BCAP). Under this Section, the Secretary will select BCAP project areas from applications consisting of a group of producers willing to commit to biomass crop production or a biomass conversion facility.

 Biomass crop producers within these BCAP project areas will enter into contracts directly with the Secretary which will enable producers to receive financial assistance for crop establishment costs as well as annual payments to support biomass production. Contracts include resource conservation requirements.

 The Secretary is directed to reduce annual payments when the biomass crops are sold to the conversion facility, used for other allowed purposes or if the producer violates the BCAP contract. This section also authorizes cost-sharing support for biomass harvest, transport, storage, and delivery to biomass user facilities, both within BCAP project areas and elsewhere. The Conference substitute provides mandatory funding of such sums as necessary to carry out this section for each of fiscal year 2008 through fiscal year 2012. (Section 9001, new Section 9011 of FSRIA)

 The Managers expect the Secretary to determine if a producer is within an economically practicable distance from a facility based on the expected cost of transporting a feedstock to the facility. The Managers understand that this distance may vary depending on several factors including the density of the feedstock and the producer’s plan for preprocessing the biomass including chopping, pelletizing or other techniques that make the biomass more easily transportable.

 The Managers intend that nonindustrial private forestland be included as ‘eligible land’ in a BCAP area and also be eligible for establishment and annual payments. Prior to entering into a contract with an owner of nonindustrial private forestland with existing tree cover, the Managers encourage the Secretary to consider the most suitable use of the land and encourage the maintenance of native forests and late successional forest stands and discourage conversion of native forests to non-forest use. The Managers understand that woody biomass feedstocks may require varying management practices including: establishment (natural or artificial regeneration), site preparation, and management of competing vegetation. The Managers recognize that in some cases, biomass from forests established or enhanced under this program may not be available for harvest within the timeframe of the contract, but may provide a long-term source of feedstock for a biomass conversion facility.

 It is the intent of the Managers that in determining the amount of an annual payment, the Secretary shall consider the costs of the activity being funded and the need for the involved biomass conversion facility to bear some costs of producing the feedstock.

 The Managers intend that the use of “soil, water and related resources” under this section includes wildlife-related concerns.

 The Managers also intend that the primary focus of the BCAP will be promoting the cultivation of perennial bioenergy crops and annual bioenergy crops that show exceptional promise for producing highly energy-efficient bioenergy or biofuels, that preserve natural resources, and that are not primarily grown for food or animal feed. In making BCAP project area selections, the Managers expect that the Secretary will consider the economic viability of the proposed biomass crop. The Managers do not intend that BCAP contract acreage provide all the feedstock necessary to supply a biomass conversion facility.

 It is the Managers’ intent that if the establishment or annual payment to a producer is reduced under this section, that the Secretary may vary the amount of payment reduction based on the reason for reducing the payment. It is also the intent of the Managers that establishment and annual payments are to be reduced by an appropriate amount in the case where a portion of an eligible crop is not sold or intended to be sold to the biomass conversion facility.

 The Managers direct the Secretary to provide a report to Congress on how information gathered under this Section was disseminated. The Managers urge the Secretary to utilize the Best Practices database created in Section 7207 of this Act and to utilize the expertise of institutions of higher education and Agriculture Innovation Centers to collect such information.

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