[Federal Register Volume 62, Number 63 (Wednesday, April 2, 1997)]
[Rules and Regulations]
[Pages 15599-15600]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-8415]



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 Rules and Regulations
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  Federal Register / Vol. 62, No. 63 / Wednesday, April 2, 1997 / Rules 
and Regulations  

[[Page 15599]]



DEPARTMENT OF AGRICULTURE

Farm Service Agency

7 CFR Part 723

RIN 0560-AF14


Special Combinations for Flue-Cured Tobacco Allotments and Quotas

AGENCY: Farm Service Agency, USDA.

ACTION: Interim rule with request for comments.

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SUMMARY: This rule provides for special, but highly limited, 
combinations of flue-cured tobacco allotments and quotas of farms 
having production flexibility contracts under the Federal Agriculture 
Improvement and Reform Act of 1996 (1996 Act) with farms without 
production flexibility contracts; and, for burley tobacco, an exemption 
to the loss of quota on farms with less than 1,000 pounds of quota when 
the farm would otherwise meet the requirements for a farm combination 
but for the existence of a production flexibility contract. Also this 
rule corrects certain technical references.

DATES: Effective April 2, 1997. Comments must be received by May 2, 
1997 to be assured of consideration.

ADDRESSES: Submit comments on the interim rule to: Director, Tobacco 
and Peanuts Division, USDA, FSA, STOP 0514, 1400 Independence Avenue 
SW, Washington, DC 20250-0514. Comments may be faxed to 202-690-2298. 
All written submissions made pursuant to this rule will be made 
available for public inspection in Room 5750 South Building, USDA, 
between the hours of 8:15 a.m. and 4:45 p.m., during regular Federal 
workdays.

FOR FURTHER INFORMATION CONTACT: Michael D. Thompson, Tobacco Branch, 
Tobacco and Peanuts Division, USDA, FSA, STOP 0514, 1400 Independence 
Avenue SW, Washington, DC 20250-0514, telephone 202-720-4318.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This rule has been determined to be not significant and therefore 
was not reviewed by OMB under Executive Order 12866.

Regulatory Flexibility Act

    The Regulatory Flexibility Act is not applicable to this interim 
rule since the Farm Service Agency (FSA) is not required by 5 U.S.C. 
553 or any other provision of law to publish a notice of proposed rule 
making with respect to the subject matter of this rule.

Federal Assistance Program

    The title and number of the Federal Assistance Program, as found in 
the Catalog of Federal Domestic Assistance, to which this rule applies 
are: Commodity Loans and Purchases--10.051.

Environmental Evaluation

    It has been determined by an environmental evaluation that this 
action will have no significant impact on the quality of the human 
environment. Therefore, neither an environmental assessment nor an 
environmental impact statement is needed.

Executive Order 12372

    This activity is not subject to the provisions of Executive Order 
12372, which requires intergovernmental consultation with State and 
local officials. See the notice related to 7 CFR part 3015, subpart V, 
published at 48 FR 29115 (June 24, 1983).

Executive Order 12988

    This interim rule has been reviewed in accordance with Executive 
Order 12988. The provisions of this interim rule are not retroactive 
and preempt State laws to the extent that such laws are inconsistent 
with the provisions of this interim rule. Before any legal action is 
brought regarding determinations made under provisions of 7 CFR part 
723, the administrative appeal provisions set forth at 7 CFR part 780 
and 7 CFR part 711, as applicable, must be exhausted.

Paperwork Reduction Act

    This interim rule does not contain new or revised information 
collection requirements that require approval by OMB under the 
Paperwork Reduction Act (44 U.S.C. 3507 et seq.). The information 
collections required in 7 CFR part 723 have previously been cleared 
under OMB control number 0560-0058.

Effective Date of Rule

    It has been determined for purposes of all limitations that might 
otherwise apply, including any provisions of the Small Business 
Regulatory Enforcement Fairness Act of 1996, that this rule should be 
effective immediately. The nature of this rule is to provide relief to 
flue-cured tobacco producers who were adversely affected by a previous 
rule that prohibited the combinations of certain farms subject to a 
production flexibility contract. The planting season for flue-cured 
tobacco begins in April and producers must make planting decisions for 
their 1997 crop. Therefore, it has been determined that delaying the 
implementation of this rule would be unnecessary, impractical, and 
contrary to the public interest. Accordingly, the rule is effective 
upon publication in the Federal Register.

Background and Discussion

    After enactment of the 1996 Act, the Department of Agriculture 
promulgated regulations which provided, in conformance with the 1996 
Act, for ``production flexibility contracts'' (PFC). The 1996 Act 
provides that farm reconstitutions, which are handled under 7 CFR part 
718, cannot increase a PFC farm's eligibility for marketing loans under 
the 1996 Act.
    To implement the latter requirement, regulations were published in 
the Federal Register (61 FR 37559, July 18, 1996) that amended 
Sec. 718.201(a)(1) to prohibit the combination of land under a PFC with 
land not under a PFC.
    Because of lease and transfer restrictions that apply only to flue-
cured tobacco allotments and quotas, farm combinations have been the 
accepted means for producers to consolidate allotments to provide 
sufficient planting flexibility for crop rotations to avoid disease 
problems and meet conservation compliance requirements. Further, 
because of an 11.5 percent increase in the flue-cured tobacco national 
marketing quota for 1997 and larger than normal undermarketings from 
the 1996 crop, many producers will have difficulty obtaining sufficient 
cropland to produce the 1997 crop. Because the

[[Page 15600]]

planting season for flue-cured tobacco begins in April, it is urgent 
that flue-cured tobacco producers make their planting decisions for the 
1997 crop. Therefore, this rule is effective immediately upon 
publication in the Federal Register. It does not appear that Congress 
meant, by the production flexibility contract provisions, to adversely 
affect the ability of flue-cured tobacco producers to conduct normal 
operations to produce their crop, except as such restrictions might be 
needed to protect the production flexibility program.
    Accordingly, this rule amends the tobacco regulations in 7 CFR part 
723 to allow the Deputy Administrator to permit special highly limited 
combinations of flue-cured tobacco allotments and quotas on PFC farms 
and non-PFC farms which will be effective for flue-cured tobacco 
purposes only. Such permission will be conditioned upon the agreement 
of interested parties not to use the land on the PFC farm that 
otherwise would have been planted to tobacco to produce a PFC 
commodity. The following commodities are PFC commodities under the 1996 
Act: wheat, corn, grain sorghum, barley, oats, upland cotton, and rice. 
Failure to comply with that agreement will render the special 
combination void and can result in penalties for tobacco marketings 
that are in excess of allowable marketings. The Deputy Administrator 
may set other conditions as necessary to comply with all relevant 
statutory schemes.
    In addition, a related change is made for burley tobacco in 7 CFR 
part 723 concerning situations in which, due to a farm reconstitution 
by division, a resulting farm may have less than 1,000 pounds of burley 
quota. That restriction is derived from section 379(c) of the 
Agricultural Adjustment Act of 1938. In order to avoid the loss of such 
quota on these farms, the quota may be sold, additional quota 
purchased, or the farm combined with another farm owned by the person 
so that at least 1,000 pounds of quota is amassed on the resulting 
farm. Here also, because of a PFC participation, some farm combinations 
which would otherwise be permitted, may no longer be allowed. This rule 
allows the Deputy Administrator to grant an exception to this minimum 
quota requirement if the farm could otherwise be combined with another 
farm so that the resulting farm would meet the 1,000 pound minimum, but 
such combination is prohibited because of PFC participation.
    Regulations governing the reconstitutions of farms that were 
previously in 7 CFR part 719 are now found in 7 CFR part 718, subpart C 
as a result of a rule published in the Federal Register on July 18, 
1996 (61 FR 37544, July 18, 1996). This interim rule corrects the 
references contained in part 723 accordingly.

List of Subjects in 7 CFR Part 723

    Acreage allotments, Auction warehouses, Dealers, Domestic 
manufacturers, Marketing quotas, Penalties, Reconstitutions, Tobacco.

Interim Rule

    For the reasons set forth in the preamble, 7 CFR part 723 is 
amended as follows:
    1. The authority citation for 7 CFR part 723 continues to read as 
follows:

PART 723--[AMENDED]

    Authority: 7 U.S.C. 1301, 1311-1314, 1314-1, 1314b, 1314b-1, 
1314b-2, 1314c, 1314d, 1314e, 1314f, 1314i, 1315, 1316, 1362, 1363, 
1372-75, 1377-79, 1421, 1445-1, and 1445-2.

    2. Section 723.209 is amended by adding paragraph (c) to read as 
follows:


Sec. 723.209  Determination of acreage allotments, marketing quotas, 
and yields for combined farms.

* * * * *
    (c) Special combinations. Notwithstanding other provisions of this 
title, the Deputy Administrator may, upon proper application and to the 
extent deemed consistent with other obligations, permit, with respect 
to allotments and quotas for flue-cured tobacco, two farms to be 
considered combined for purposes of this part and part 1464 of this 
title only, even though one of the farms involved is subject to a 
production flexibility contract (PFC) entered into under the provisions 
of 7 CFR part 1412. Such farms must otherwise meet the requirements for 
farm combinations in part 718. Such permission shall be conditioned 
upon the agreement of all interested parties that land on the PFC flue-
cured quota farm that would have been used for the production of 
tobacco shall not be used for the production of any PFC commodity. A 
failure to comply with this provision shall render this special 
combination void, retroactive to the date of original approval. Such 
action may result in tobacco acreage in excess of the allotment and in 
marketing quota penalties on any excess marketings of tobacco. The 
Deputy Administrator may set such additional conditions on the 
production of tobacco on such farms as deemed necessary to serve the 
goals of the tobacco program and the goals of the production 
flexibility contract. The term ``PFC commodity'' for purposes of this 
paragraph means wheat, corn, grain sorghum, barley, oats, upland 
cotton, and rice.
    3. Section 723.208 is amended by adding paragraph (b)(6)(v) to read 
as follows:


Sec. 723.208  Determination of acreage allotments, marketing quotas, 
and yields for divided farms.

* * * * *
    (b) * * *
    (6) * * *
    (v) when the individual tract or farm with less than 1,000 pounds 
of quota could be combined with another tract or farm with sufficient 
quota to reach 1,000 pounds but for the existence of a production 
flexibility contract on one of the farms.
* * * * *


Secs. 723-723.509  [Amended]

    4. Sections 723.101 through 723.509 are amended by removing the 
numbers ``719'' each time they appear and adding in their place 
``718''.

    Signed at Washington, DC, on March 25, 1997.
Bruce R. Weber,
Acting Administrator, Farm Service Agency.
[FR Doc. 97-8415 Filed 4-1-97; 8:45 am]
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