7 U.S.C. § 1359ii — Provisions applicable to producers

**(a) Processor assurances** (1) **In general** — If allotments for a crop year are allocated to processors under [section 1359dd of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title7-section1359dd&num=0&edition=prelim), the Secretary shall obtain from the processors such assurances as the Secretary considers adequate that the allocation will be shared among producers served by the processor in a fair and equitable manner that adequately reflects producers’ production histories. (2) **Arbitration** (A) *In general* — Any dispute between a processor and a producer, or group of producers, with respect to the sharing of the allocation to the processor shall be resolved through arbitration by the Secretary on the request of either party. (B) *Period* — The arbitration shall, to the maximum extent practicable, be— (i) commenced not more than 45 days after the request; and (ii) completed not more than 60 days after the request. **(b) Sugar beet processing facility closures** (1) **In general** — If a sugar beet processing facility is closed and the sugar beet growers that previously delivered beets to the facility elect to deliver their beets to another processing company, the growers may petition the Secretary to modify allocations under this subpart to allow the delivery. (2) **Increased allocation for processing company** — The Secretary may increase the allocation to the processing company to which the growers elect to deliver their sugar beets, with the approval of the processing company, to a level that does not exceed the processing capacity of the processing company, to accommodate the change in deliveries. (3) **Decreased allocation for closed company** — The increased allocation shall be deducted from the allocation to the company that owned the processing facility that has been closed and the remaining allocation shall be unaffected. (4) **Timing** — The determinations of the Secretary on the issues raised by the petition shall be made within 60 days after the filing of the petition. **(c) Proportionate shares of certain allotments** (1) **Definition of seed** (A) *In general* — In this subsection, the term “seed” means only those varieties of seed that are dedicated to the production of sugarcane from which is produced sugar for human consumption. (B) *Exclusion* — The term “seed” does not include seed of a high-fiber cane variety dedicated to other uses, as determined by the Secretary. (2) **In general** (A) *States affected* — In any case in which a State allotment is established under [section 1359cc(f) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title7-section1359cc/f&num=0&edition=prelim) and there are in excess of 250 sugarcane producers in the State (other than Puerto Rico), the Secretary shall make a determination under subparagraph (B). (B) *Determination* — The Secretary shall determine, for each State allotment described in subparagraph (A), whether the production of sugarcane, in the absence of proportionate shares, will be greater than the quantity needed to enable processors to fill the allotment and provide a normal carryover inventory of sugar. (3) **Establishment of proportionate shares** — If the Secretary determines under paragraph (2) that the quantity of sugar produced from sugarcane produced by producers in the area covered by a State allotment for a crop year will be in excess of the quantity needed to enable processors to fill the allotment for the crop year and provide a normal carryover inventory of sugar, the Secretary shall establish a proportionate share for each sugarcane-producing farm that limits the acreage of sugarcane that may be harvested on the farm for sugar or seed during the crop year the allotment is in effect as provided in this subsection. Each such proportionate share shall be subject to adjustment under paragraph (8) and [section 1359cc(g) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title7-section1359cc/g&num=0&edition=prelim). (4) **Method of determining** — For purposes of determining proportionate shares for any crop of sugarcane: (A) The Secretary shall establish the State’s per-acre yield goal for a crop of sugarcane at a level (not less than the average per-acre yield in the State for the 2 highest years from among the 1999, 2000, and 2001 crop years, as determined by the Secretary) that will ensure an adequate net return per pound to producers in the State, taking into consideration any available production research data that the Secretary considers relevant. (B) The Secretary shall adjust the per-acre yield goal by the average recovery rate of sugar produced from sugarcane by processors in the State. (C) The Secretary shall convert the State allotment for the crop year involved into a State acreage allotment for the crop by dividing the State allotment by the per-acre yield goal for the State, as established under subparagraph (A) and as further adjusted under subparagraph (B). (D) The Secretary shall establish a uniform reduction percentage for the crop by dividing the State acreage allotment, as determined for the crop under subparagraph (C), by the sum of all adjusted acreage bases in the State, as determined by the Secretary. (E) The uniform reduction percentage for the crop, as determined under subparagraph (D), shall be applied to the acreage base for each sugarcane-producing farm in the State to determine the farm’s proportionate share of sugarcane acreage that may be harvested for sugar or seed. (5) **Acreage base** — For purposes of this subsection, the acreage base for each sugarcane-producing farm shall be determined by the Secretary, as follows: (A) The acreage base for any farm shall be the number of acres that is equal to the average of the acreage planted and considered planted for harvest for sugar or seed on the farm in the 2 highest of the 1999, 2000, and 2001 crop years. (B) Acreage planted to sugarcane that producers on a farm were unable to harvest to sugarcane for sugar or seed because of drought, flood, other natural disaster, or other condition beyond the control of the producers may be considered as harvested for the production of sugar or seed for purposes of this paragraph. (6) **Violation** (A) *In general* — Whenever proportionate shares are in effect in a State for a crop of sugarcane, producers on a farm shall not knowingly harvest, or allow to be harvested, for sugar or seed an acreage of sugarcane in excess of the farm’s proportionate share for the crop year, or otherwise violate proportionate share regulations issued by the Secretary under [section 1359hh(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title7-section1359hh/a&num=0&edition=prelim). (B) *Determination of violation* — No producer shall be considered to have violated subparagraph (A) unless the processor of the sugarcane harvested by such producer from acreage in excess of the proportionate share of the farm markets an amount of sugar that exceeds the allocation of such processor for a crop year. (C) *Civil penalty* — Any producer on a farm who violates subparagraph (A) by knowingly harvesting, or allowing to be harvested, an acreage of sugarcane for sugar in excess of the farm’s proportionate share shall be liable to the Commodity Credit Corporation for a civil penalty equal to one and one-half times the United States market value of the quantity of sugar that is marketed by the processor of such sugarcane in excess of the allocation of such processor for the crop year. The Secretary shall prorate penalties imposed under this subparagraph in a fair and equitable manner among all the producers of sugarcane harvested from excess acreage that is acquired by such processor. (7) **Waiver** — Notwithstanding the preceding subparagraph, the Secretary may authorize the county and State committees established under [section 590h(b) of title 16](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title16-section590h/b&num=0&edition=prelim) to waive or modify deadlines and other proportionate share requirements in cases in which lateness or failure to meet the other requirements does not affect adversely the operation of proportionate shares. (8) **Adjustments** — Whenever the Secretary determines that, because of a natural disaster or other condition beyond the control of producers that adversely affects a crop of sugarcane subject to proportionate shares, the amount of sugar from sugarcane produced by producers subject to the proportionate shares will not be sufficient to enable processors in the State to meet the State’s cane sugar allotment and provide a normal carryover inventory of sugar, the Secretary may uniformly allow producers to harvest an amount of sugarcane in excess of their proportionate share, or suspend proportionate shares entirely, as necessary to enable processors to meet the State allotment and provide a normal carryover inventory of sugar.