(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.
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".
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.
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