[Federal Register Volume 61, Number 174 (Friday, September 6, 1996)]
[Proposed Rules]
[Pages 47093-47095]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-22788]


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DEPARTMENT OF AGRICULTURE
7 CFR Part 1160

[DA-96-09]


Fluid Milk Promotion Order; Invitation To Submit Comments on 
Proposed Amendments to the Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This document invites written comments on proposals to amend 
the Fluid Milk Promotion Order. The proposed amendments, requested by 
the National Fluid Milk Processor Promotion Board, which administers 
the order, would modify the term limits and membership status of Board 
members. The proposed rule would also amend certain order language in 
conformance with the 1996 Federal Agriculture Improvement and Reform 
Act. In addition, this proposed rule would revise or remove order 
language that has become obsolete and no longer effectuates the 
declared policy of the Fluid Milk Promotion Act of 1990, as amended.

DATES: Comments are due no later than October 7, 1996.

ADDRESSES: Comments (two copies) should be filed with the USDA/AMS/
Dairy Division, Promotion and Research Staff, Room 2734, South 
Building, P.O. Box 96456, Washington, DC 20090-6456.

FOR FURTHER INFORMATION CONTACT: Eugene Krueger, Head, Promotion and 
Research Staff, USDA/AMS/Dairy Division, Room 2734, South Building, 
P.O. Box 96456, Washington, DC 20090-6456, (202) 720-6909.

Small Business Consideration

    The Regulatory Flexibility Act (5 U.S.C. 601-612) requires the 
Agency to examine the impact of a proposed rule on small entities. 
Small businesses in the fluid milk processing industry have been 
defined by the Small Business Administration as those employing less 
than 500 employees. There are approximately 250 fluid milk processors 
subject to the provisions of the Fluid Milk Promotion Order. Most of 
the parties subject to the Order are considered small entities.
    This rule would modify the term of office and membership provisions 
of the Fluid Milk Promotion Order. The proposed amendments would allow 
a National Fluid Milk Processor Promotion Board member who changes 
fluid milk processor affiliations during his or her term to be eligible 
to serve on the Board in another capacity during that same term. The 
proposed amendments would also modify the term of Board members to 
allow any member elected during the initial period to serve a term of 
one or two years to be eligible for reappointment for two additional 
three-year terms. The proposed amendments should clarify the Order with 
respect to membership status and term limits of its members.
    This rule would also amend order language in conformance with the 
1996 Federal Agriculture Improvement and Reform Act; the definition of 
research would be changed to conform with the definition in the Act and 
the order would be revised to reflect changes in the 1996 Act 
concerning those fluid milk processors who may request a referendum to 
suspend or terminate the order and who may vote to suspend or terminate 
the order or adjust the assessment rate.
    Further, the rule would also revise or remove obsolete or 
unnecessary order language in conformance with the President's 
Regulatory Reform Initiative. Pursuant to 5 U.S.C. 605(b), the 
Agricultural Marketing Service has certified that this rule would not 
have a significant economic impact on a substantial number of small 
entities.

SUPPLEMENTARY INFORMATION: The Department is issuing this proposed rule 
in conformance with Executive Order 12866.

[[Page 47094]]

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is not intended to have a retroactive 
effect. If adopted, this proposed rule would not preempt any State or 
local laws, regulations, or policies unless they present an 
irreconcilable conflict with this rule.
    The Fluid Milk Promotion Act of 1990, as amended, authorizes the 
Fluid Milk Promotion Order. The Act provides that administrative 
proceedings must be exhausted before parties may file suit in court. 
Under section 1999K of the Act, any person subject to a Fluid Milk 
Promotion Order may file with the Secretary a petition stating that the 
Order, any provision of the Order, or any obligation imposed in 
connection with the Order is not in accordance with the law and request 
a modification of the Order or to be exempted from the Order. A person 
subject to an order is afforded the opportunity for a hearing on the 
petition. After a hearing, the Secretary would rule on the petition. 
The Act provides that the district court of the United States in any 
district in which the person is an inhabitant, or has his principal 
place of business, has jurisdiction to review the Secretary's ruling on 
the petition, provided a complaint is filed not later than 20 days 
after the date of the entry of the ruling.
    In accordance with the Paperwork Reduction Act (44 U.S.C. Chapter 
35), the forms and reporting and recordkeeping requirements that are 
included in the Fluid Milk Promotion Order have been approved 
previously by the Office of Management and Budget (OMB) and were 
assigned OMB No. 0581-0093, except for Board members' nominee 
information sheets that were assigned OMB No. 0505-0001.

Statement of Consideration

    The proposed rule would amend certain provisions of the Fluid Milk 
Promotion Order. Certain proposed amendments would modify the term 
limits and the membership status provisions of the Order. The proposed 
amendments would allow a National Fluid Milk Processor Promotion Board 
member who changes fluid milk processor affiliations during his or her 
term to be eligible to serve on the Board in another capacity during 
that same term. Under current order provisions, a Board member who 
changes fluid milk processor affiliations during his or her term is 
ineligible to serve on the Board in any capacity.
    The proposed amendments would also modify the term of Board members 
to allow any member elected during the initial period to serve a term 
of one or two years to be eligible for reappointment for two additional 
three-year terms. Currently, the Order states that a Board member 
appointed to serve during the initial period is eligible to be 
reappointed to serve only one additional three-year term. Under these 
order provisions, some Board members will serve an initial term of less 
than three years because of the staggering of terms. The Board contends 
that the proposed amendments will clarify the Order with respect to 
membership status and term limits of its members.
    This document also proposes to amend the Fluid Milk Promotion Order 
to conform with legislated changes made by the recently enacted 1996 
Federal Agriculture Improvement and Reform Act (P.L. 104-127). Section 
146 of the Act amends sections 1999C(6), 1999N(b)(2), 1999O(c), and 
1999O(a) of the Fluid Milk Promotion Act of 1990, as amended, thereby 
necessitating changes to the Fluid Milk Promotion Order. The following 
sections of the Order would be amended on this basis:
    1. In Sec. 1160.112, Research would be redefined in conformance 
with the Act.
    2. In Sec. 1160.501, paragraphs (a) and (b)(2) would be amended in 
conformance with the Act in order to specify those fluid milk 
processors who may request a referendum to suspend or terminate the 
Order.
    3. In Sec. 1160.605, paragraph (b)(2) would be amended in 
conformance with the Act in order to specify those fluid milk 
processors who, on the basis of a referendum, may vote to suspend or 
terminate the Order, or adjust the assessment rate.
    The President's Regulatory Reform Initiative, among other things, 
directs agencies to remove obsolete and unnecessary language and to 
find less burdensome ways to achieve regulatory goals. Changes are 
proposed in conformance with the initiative. These amendments to the 
Order and regulations would revise or remove order language that was 
needed to implement the order but is no longer needed. This language is 
obsolete and unnecessary because it relates to the initial fiscal 
period and the previously conducted initial continuation referendum. 
Provisions of the following sections of the Order would be amended on 
this basis:
    1. Sec. 1160.108 Fluid milk processor.
    2. Sec. 1160.113 Fiscal period.
    3. Sec. 1160.116 Initial referendum.
    4. Sec. 1160.209 Duties of the Board.
    5. Sec. 1160.211 Assessments.
    6. Sec. 1160.501 Continuation referenda.
    7. Sec. 1160.605 Date of the referendum.

List of Subjects in 7 CFR Part 1160

    Fluid milk products, Milk, Promotion.

    For the reasons set forth in the preamble, it is proposed that 7 
CFR Part 1160 is amended as follows:

PART 1160--FLUID MILK PROMOTION PROGRAM

    1. The authority citation for 7 CFR Part 1160 continues to read as 
follows:

    Authority: 7 U.S.C. 6401-6417.

    2. In Sec. 1160.108, paragraph (a) is revised to read as follows:


Sec. 1160.108  Fluid milk processor.

    (a) Fluid milk processor means any person who processes and markets 
commercially fluid milk products in consumer-type packages in the 
United States, except that the term fluid milk processor shall not 
include in each of the respective fiscal periods those persons who 
process and market not more than 500,000 pounds of such fluid milk 
products during the representative month, which shall be the first 
month of the fiscal period; Provided, however, that for the fiscal 
period following the initial fiscal period, the representative month 
shall be September 1995.
* * * * *
    3. Section 1160.112 is revised to read as follows:


Sec. 1160.112  Research.

    Research means market research to support advertising and promotion 
efforts, including educational activities, research directed to product 
characteristics, and product development, including new products or 
improved technology in production, manufacturing or processing of milk 
and the products of milk.
    4. Section 1160.113 is revised to read as follows:


Sec. 1160.113  Fiscal period.

    Fiscal period means the initial period of up to 30 months that this 
subpart is effective. Thereafter, the fiscal period shall be such 
annual period as the Board may determine, except that the Board may 
provide for a lesser or greater period as it may find appropriate for 
the period immediately after the initial fiscal period to assure 
continuity of fiscal periods until the beginning of the first annual 
fiscal period.


Sec. 1160.116  [Removed and Reserved]

    5. Section 1160.116 is removed and reserved.


Sec. 1160.200  [Amended]

    6. In Sec. 1160.200, paragraph (a) is amended by adding the words 
``in the position previously held by such

[[Page 47095]]

member'' after the words ``membership on the board''.
    7. In Sec. 1160.201, paragraph (b) is revised to read as follows:


Sec. 1160.201  Term of office.

* * * * *
    (b) No member shall serve more than two consecutive terms, except 
that any member who is appointed to serve for an initial term of one or 
two years shall be eligible to be reappointed for two three-year terms. 
Appointment to another position on the Board is considered a 
consecutive term.


Sec. 1160.209  Duties of the board.

    8. In Sec. 1160.209, paragraph (b) is revised to read as follows:
* * * * *
    (b) To prepare and submit to the Secretary for approval a budget 
for each fiscal period of the anticipated expenses and disbursements in 
the administration of this subpart, including a description of and the 
probable costs of consumer education, promotion and research projects;
* * * * *
    9. In Sec. 1160.211, paragraphs (a)(1) and (a)(2) are revised to 
read as follows:


Sec. 1160.211  Assessments.

    (a)(1) Each fluid milk processor shall pay to the Board or its 
designated agent an assessment of $.20 per hundredweight of fluid milk 
products processed and marketed commercially in consumer-type packages 
in the United States by such fluid milk processor. Producer-handlers 
required to pay assessments under section 113(g) of the Dairy 
Production Stabilization Act of 1983 (7 U.S.C. 4504(g)), and not exempt 
under Sec. 1160.108, shall also pay the assessment under this subpart. 
No assessments are required on fluid milk products exported from the 
United States. The Secretary shall have the authority to receive 
assessments on behalf of the Board.
    (2) The Secretary shall announce the establishment of the 
assessment each month in the Class I price announcement in each milk 
marketing area by adding it to the Class I price for the following 
month. In the event the assessment is suspended for a given month, the 
Secretary shall inform all fluid milk processors of the suspension in 
the Class I price announcement for that month. The Secretary shall also 
inform fluid milk processors marketing fluid milk in areas not subject 
to milk marketing orders administered by the Secretary of the 
establishment or suspension of the assessment.
* * * * *
    10. Section 1160.501 is amended by removing paragraph (a), 
redesignating paragraphs (b) through (d) as paragraphs (a) through (c), 
removing the the cross reference ``1160.501(c)'' in paragraph (c) and 
adding in its place ``1160.501(b)'', and revising newly designated 
paragraphs (a) and (b)(2) to read as follows:


Sec. 1160.501  Continuation referenda.

    (a) The Secretary at any time may conduct a referendum among those 
persons who the Secretary determines were fluid milk processors during 
a representative period, as determined by the Secretary, on whether to 
suspend or terminate the order. The Secretary shall hold such a 
referendum at the request of the Board or of any group of such 
processors that marketed during a representative period, as determined 
by the Secretary, 10 percent or more of the volume of fluid milk 
products marketed in the United States by fluid milk processors voting 
in the preceding referendum.
    (b) * * *
    (1) * * *
    (2) By fluid milk processors voting in the referendum that marketed 
during a representative period, as determined by the Secretary, 40 
percent or more of the volume of fluid milk products marketed in the 
United States by fluid milk processors voting in the referendum.
    11. In Sec. 1160.605, paragraph (a) is removed, paragraphs (b) 
through (c) are redesignated as paragraphs (a) through (b), and newly 
designated paragraph (b)(2) is revised to read as follows:


Sec. 1160.605  Date of referendum.

* * * * *
    (b) * * *
    (1) * * *
    (2) Upon request of the Board or upon request of any group of fluid 
milk processors that among them marketed during a representative 
period, as determined by the Secretary, 10 percent or more of the 
volume of fluid milk products marketed by fluid milk processors voting 
in the preceding referendum.

    Dated: August 30, 1996.
Kenneth C. Clayton,
Acting Administrator.
[FR Doc. 96-22788 Filed 9-5-96; 8:45 am]
BILLING CODE 3410-02-P