7 U.S. Code § 9056 - Dairy margin coverage payments

(a) Coverage level threshold and coverage percentage

(1) Coverage level threshold

(A) In general

For purposes of receiving dairy margin coverage payments for a month, a participating dairy operation shall annually elect a coverage level threshold that is equal to $4.00, $4.50, $5.00, $5.50, $6.00, $6.50, $7.00, $7.50, $8.00, $8.50, $9.00, or $9.50.

(B) Applicability

Except as provided in subparagraph (C), the coverage level threshold elected under subparagraph (A) shall apply to the covered production elected by the participating dairy operation under paragraph (2).

(C) Second coverage election for tier II

In the case of a participating dairy operation that elects a coverage level threshold of $8.50, $9.00, or $9.50 under subparagraph (A)—

(i) that coverage level threshold shall apply to the first 5,000,000 pounds of milk marketings included in the covered production elected by the participating dairy operation; and

(ii) the participating dairy operation shall elect a coverage level threshold that is equal to $4.00, $4.50, $5.00, $5.50, $6.00, $6.50, $7.00, $7.50, or $8.00 to apply to milk marketings in excess of 5,000,000 pounds included in the covered production elected by the participating dairy operation.

(2) Coverage percentage

For purposes of receiving dairy margin coverage payments for a month, a participating dairy operation shall annually elect a percentage of coverage, in 5-percent increments, not exceeding 95 percent of the production history of the participating dairy operation.

(b) Payment threshold

A participating dairy operation shall receive a dairy margin coverage payment whenever the average actual dairy production margin for a month is less than the coverage level threshold selected by the participating dairy operation.

(c) Amount of payment

The dairy margin coverage payment for the participating dairy operation shall be determined as follows:

(1) The Secretary shall calculate the amount by which the coverage level threshold selected by the participating dairy operation exceeds the average actual dairy production margin for the month.

(2) The amount determined under paragraph (1) shall be multiplied by—

(A) the coverage percentage selected by the participating dairy operation; and

(B) the production history of the participating dairy operation divided by 12.

(Pub. L. 113–79, title I, § 1406, Feb. 7, 2014, 128 Stat. 691; Pub. L. 115–123, div. F, § 60101(b)(1)(C), Feb. 9, 2018, 132 Stat. 311; Pub. L. 115–334, title I, § 1401(g), (k)(7), Dec. 20, 2018, 132 Stat. 4513, 4517.)

Editorial Notes

Amendments

2018—Pub. L. 115–334, § 1401(k)(7)(A) substituted “Dairy margin coverage” for “Margin protection” in section catchline.

Pub. L. 115–123, § 60101(b)(1)(C)(i), substituted “month” for “consecutive 2-month period” wherever appearing.

Subsec. (a). Pub. L. 115–334, § 1401(g), added subsec. (a) and struck out former subsec. (a). Prior to amendment, text read as follows: “For purposes of receiving margin protection payments for a month, a participating dairy operation shall annually elect—

“(1) a coverage level threshold that is equal to $4.00, $4.50, $5.00, $5.50, $6.00, $6.50, $7.00, $7.50, or $8.00; and

“(2) a percentage of coverage, in 5-percent increments, beginning with 25 percent and not exceeding 90 percent of the production history of the participating dairy operation.”

Subsec. (b). Pub. L. 115–334, § 1401(k)(7)(B), substituted “dairy margin coverage” for “margin protection”.

Subsec. (c). Pub. L. 115–334, § 1401(k)(7)(B), (C), struck out “margin protection” before “payment” in heading and substituted “dairy margin coverage” for “margin protection” in text.

Subsec. (c)(2)(B). Pub. L. 115–123, § 60101(b)(1)(C)(ii), substituted “divided by 12” for “divided by 6”.

Statutory Notes and Related Subsidiaries

Effective Date of 2018 Amendment

Amendment by Pub. L. 115–334 effective on Jan. 1, 2019, see section 1401(m) of Pub. L. 115–334, set out as a note under section 9051 of this title.

Amendment by Pub. L. 115–123 applicable beginning with the 2018 calendar year, see section 60101(b)(5) of Pub. L. 115–123, set out as a note under section 9051 of this title.

Supplemental Dairy Margin Coverage Payments

Pub. L. 116–260, div. N, title VII, § 761, Dec. 27, 2020, 134 Stat. 2109, provided that:

“(a) In General.—

The Secretary shall provide supplemental dairy margin coverage payments to participating eligible dairy operations described in subsection (b)(1) whenever the average actual dairy production margin (as defined in section 1401 of the Agricultural Act of 2014 (7 U.S.C. 9051)) for a month is less than the coverage level threshold selected by such eligible dairy operation under section 1406 of that Act (7 U.S.C. 9056).

“(b) Eligible Dairy Operation Described.—

“(1) In general.—

An eligible dairy operation described in this subsection is a dairy operation that—

“(A) is located in the United States; and

“(B) during a calendar year in which such dairy operation is a participating dairy operation (as defined in section 1401 of the Agricultural Act of 2014 (7 U.S.C. 9051)), has a production history established under the dairy margin coverage program under section 1405 of the Agricultural Act of 2014 (7 U.S.C. 9055) of less than 5,000,000 pounds, as determined in accordance with subsection (c) of such section 1405.

“(2) Limitation on eligibility.—

An eligible dairy operation shall only be eligible for payments under this section during a calendar year in which such eligible dairy operation is enrolled in the dairy margin coverage (as defined in section 1401 of the Agricultural Act of 2014 (7 U.S.C. 9051)).

“(c) Supplemental Production History Calculation.—

“(1) In general.—

For purposes of determining the supplemental production history of an eligible dairy operation under this section, such dairy operation’s supplemental production history shall be equal to 75 percent of the amount described in paragraph (2) with respect to such dairy operation.

“(2) Amount.—

The amount referred to in paragraph (1) is, with respect to an eligible dairy operation, the amount equal to—

“(A) the production volume of such dairy operation for the 2019 milk marketing year; minus

“(B) the dairy margin coverage production history of such dairy operation established under section 1405 of the Agricultural Act of 2014 (7 U.S.C. 9055).

“(d) Coverage Percentage.—

“(1) In general.—

For purposes of calculating payments to be issued under this section during a calendar year, an eligible dairy operation’s coverage percentage shall be equal to the coverage percentage selected by such eligible dairy operation with respect to such calendar year under section 1406 of the Agricultural Act of 2014 (7 U.S.C. 9056).

“(2) 5 million pound limitation.—

“(A) In general.—

The Secretary shall not provide supplemental dairy margin coverage on an eligible dairy operation’s actual production for a calendar year such that the total covered production history of such dairy operation exceeds 5,000,000 pounds.

“(B) Determination of amount.—

In calculating the total covered production history of an eligible dairy operation under subparagraph (A), the Secretary shall multiply the coverage percentage selected by such operation under section 1406 of the Agricultural Act of 2014 (7 U.S.C. 9056) by the sum of—

“(i) the supplemental production history calculated under subsection (c) with respect to such dairy operation; and

“(ii) the dairy margin coverage production history described in subsection (c)(2)(B) with respect to such dairy operation.

“(e) Premium Cost.—

The premium cost for an eligible dairy operation under this section for a calendar year shall be equal to the product of multiplying—

“(1) the Tier I premium cost calculated with respect to such dairy operation for such year under section 1407(b) of the Agricultural Act of 2014 (7 U.S.C. 9057(b)); by

“(2) the supplemental production history with respect to such dairy operation calculated under subsection (c) (such that total covered production history does not exceed 5,000,000 pounds).

“(f) Regulations.—

Not later than 45 days after the date of the enactment of this section [Dec. 27, 2020], the Secretary shall issue regulations to carry out this section.

“(g) Prohibition With Respect to Dairy Margin Coverage Enrollment.—

“(1) In general.—

The Secretary may not reopen or otherwise provide a special enrollment for dairy margin coverage (as defined in section 1401 of the Agricultural Act of 2014 (7 U.S.C. 9051)) for purposes of establishing eligibility for supplemental dairy margin coverage payments under this section.

“(2) Clarification with respect to supplemental dairy margin coverage payments.—

The Secretary may open a special enrollment for supplemental dairy margin coverage under this section.

“(h) Application for Calendar Year 2021.—

The Secretary shall make payments under this section to eligible dairy operations described in subsection (b)(1) for months after and including January, 2021.

“(i) Sunset.—

The authority to make payments under this section shall terminate on December 31, 2023.

“(j) Funding.—

There is appropriated, out of any funds in the Treasury not otherwise appropriated, to carry out this section such sums as necessary, to remain available until the date specified in subsection (i).”

[For definition of “Secretary” as used in section 761 of div. N of Pub. L. 116–260, set out above, see section 760 of div. N of Pub. L. 116–260, set out as a note under section 5936a of this title.]