§7235. Loan deficiency payments

(a) Availability of loan deficiency payments

Except as provided in subsection (d) of this section, the Secretary may make loan deficiency payments available to producers who, although eligible to obtain a marketing assistance loan under section 7231 of this title with respect to a loan commodity, agree to forgo obtaining the loan for the commodity in return for payments under this section.

(b) Computation

A loan deficiency payment under this section shall be computed by multiplying-

(1) the loan payment rate determined under subsection (c) of this section for the loan commodity; by

(2) the quantity of the loan commodity that the producers on a farm are eligible to place under loan but for which the producers forgo obtaining the loan in return for payments under this section.

(c) Loan payment rate

For purposes of this section, the loan payment rate shall be the amount by which-

(1) the loan rate established under section 7232 of this title for the loan commodity; exceeds

(2) the rate at which a loan for the commodity may be repaid under section 7234 of this title.

(d) Exception for extra long staple cotton

This section shall not apply with respect to extra long staple cotton.

( Pub. L. 104–127, title I, §135, Apr. 4, 1996, 110 Stat. 909 .)

Section Referred to in Other Sections

This section is referred to in section 1308 of this title.