[Federal Register Volume 62, Number 140 (Tuesday, July 22, 1997)]
[Rules and Regulations]
[Pages 39386-39395]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-19150]



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Part V





Department of Agriculture





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Agricultural Marketing Service



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7 CFR Part 1215



Popcorn Promotion, Research, and Consumer Information Order; Final Rule

  Federal Register / Vol. 62, No. 140 / Tuesday, July 22, 1997 / Rules 
and Regulations  

[[Page 39386]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1215

[FV-96-706FR]


Popcorn Promotion, Research, and Consumer Information Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This document establishes a Popcorn Promotion, Research, and 
Consumer Information Order (Order) under the Popcorn Promotion, 
Research, and Consumer Information Act of 1996. Under the Order, 
processors will pay an assessment rate of 5 cents per hundredweight of 
popcorn to the Popcorn Board (Board). Composed of popcorn processors, 
the Board will use the assessments collected to conduct a generic 
program of promotion, research, and consumer information to maintain 
and expand markets for popcorn. The U.S. Department (Department) of 
Agriculture conducted a referendum among eligible popcorn processors to 
determine whether they favor the implementation of the Order. The Order 
was approved by a majority of those voting in the referendum with such 
majority, processing more than 50 percent of the popcorn processed by 
all those voting in the referendum.

EFFECTIVE DATE: September 1, 1997.

ADDRESSES: Stacey L. Bryson, Research and Promotion Branch, Fruit and 
Vegetable Division, AMS, USDA, P.O. Box 96456, Room 2535-S, Washington, 
DC 20090-6456.

FOR FURTHER INFORMATION CONTACT: Stacey L. Bryson at the above address 
or telephone (888) 720-9917 (toll free) or (202) 720-6930.

SUPPLEMENTARY INFORMATION: Prior documents in this proceeding: Proposed 
Rule published in the September 30, 1996, issue of the Federal Register 
(61 FR 51046); Proposed Rule and Referendum Order published in the 
March 21, 1997, issue of the Federal Register (62 FR 13551).
    This final rule is issued under the Popcorn Promotion, Research, 
and Consumer Information Act (7 U.S.C. 7481-7491), hereinafter referred 
to as the Act.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. It is not intended to have retroactive effect. This 
rule will not preempt any State or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with this 
rule. Further, Sec. 580 of the Act states that nothing in the popcorn 
statute preempts or supersedes any other program relating to popcorn 
promotion organized and operated under the laws of the United States or 
any State.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under Sec. 577 of the Act, after 
an Order is implemented, a person subject to the Order may file a 
petition with the Secretary stating that the Order or any provision of 
the Order, or any obligation imposed in connection with the Order, is 
not in accordance with law and requesting a modification of the Order 
or an exemption from the Order. The petitioner is afforded the 
opportunity for a hearing on the petition. After such hearing, the 
Secretary will make a ruling on the petition. The Act provides that the 
district courts of the United States in any district in which a person 
who is a petitioner resides or carries on business are vested with 
jurisdiction to review the Secretary's ruling on the petition, if a 
complaint for that purpose is filed within 20 days after the date of 
the entry of the ruling.

Executive Order 12866 and Regulatory Flexibility Act

    This rule has been determined not significant for purposes of 
Executive Order 12866 and therefore has not been reviewed by the Office 
of Management and Budget.
    In accordance with the Regulatory Flexibility Act (5 U.S.C. 601 et 
seq.), the Agency has examined the impact of the proposed rule on small 
entities.
    Legislation to create a generic program of promotion and research 
for popcorn became effective on April 4, 1996. Congress found that this 
program is vital to the welfare of popcorn processors and persons 
concerned with marketing, using, and producing popcorn for the market, 
as well as to the agricultural economy of the United States.
    This program is intended to develop and finance an effective and 
coordinated program of promotion, research, and consumer information to 
maintain and expand the markets for popcorn. The program was initiated 
by the popcorn industry, which approved the program in a referendum in 
advance of its implementation, and industry members will serve on the 
Board that will administer the program under the Department's 
supervision. In addition, any person subject to the program may file 
with the Secretary a petition stating that the order or any provision 
is not in accordance with law and requesting a modification of the 
order or an exemption from the order. Administrative proceedings were 
discussed earlier in this rule.
    In this program, processors will submit assessments and reports to 
the Board. In addition, exempt processors will be required to file an 
exemption application. While the Order will impose certain 
recordkeeping requirements on processors, information required under 
the Order could be compiled from records currently maintained. The 
forms require the minimum information necessary to effectively carry 
out the requirements of the program, and their use is necessary to 
fulfill the intent of the Act. The estimated cost in providing 
information to the Board by the estimated 67 respondents will be $40.32 
per respondent annually.
    The Department will oversee program operations and, the Secretary 
may conduct referenda at the request of the Board or a representative 
group of processors to determine whether the popcorn industry supports 
continuation of the program.
    There are approximately 35 processors who will pay the assessments, 
out of an industry of 67 processors in total.
    Small agricultural service firms, which will include processors who 
will be covered under the Order, have been defined by the Small 
Business Administration [13 CFR 121.607] as those whose annual receipts 
are less than $5 million.
    Almost 50 percent of the industry will be exempt from the program. 
Those processors marketing 4 million pounds of popcorn or less annually 
will be exempt from the Order. It is also estimated that only 2 of the 
35 eligible processors will be classified as small entities. Those 
processors marketing more than 4 million pounds of popcorn annually 
represent the majority of the tonnage processed each year.
    The Department will seek ways to minimize the burden of complying 
with the program for the small businesses that will be affected by it. 
A compliance guide will be issued for the small businesses that will 
pay assessments as well as those that will be exempt. In addition, the 
Department will work with the Popcorn Board to ensure, to the extent 
practicable, that the procedures implemented represent the least 
burdensome alternatives while meeting the needs of the program.
    It was estimated that there were 35 popcorn processors who were 
eligible to vote in the referendum. An average of 15 minutes was needed 
for each voter to

[[Page 39387]]

read the voting instructions and complete the referendum ballot. The 
total burden on the total number of voters was 2.9 hours.
    The information collection requirements under the Order require the 
minimum information necessary to effectively carry out the requirement 
of the program, and their use is necessary to fulfill the intent of the 
Act. The monthly collection of information coincides with normal 
business practices and can be supplied without data processing 
equipment or outside technical expertise. In addition, there are no 
additional training requirements for individuals filling out reports 
and remitting assessments to the Board. The estimated cost in providing 
information to the Board by the estimated 67 respondents will be $19.28 
per respondent annually. This total has been estimated by multiplying 
129.15 (total burden hours requested) by $10.00 per hour, a sum deemed 
to be reasonable if the respondents were compensated for their time.
    According to the Popcorn Institute (Institute), a trade association 
consisting of popcorn processors representing the industry, annual 
sales of popcorn were 77.240 million pounds less in 1994 than they were 
in 1993, when sales totaled approximately 1.156 billion pounds.
    The peak period for popcorn sales for home consumption is the fall. 
Sales remain constant throughout the winter months and taper off during 
the spring and summer.
    Almost all of the popcorn consumed throughout the world is grown in 
the United States, and Americans consume more popcorn than the citizens 
of any other country. Popcorn is grown in 19 states. According to the 
latest Census on Agriculture, the top five major popcorn-producing 
states in 1992 were, in descending order, Indiana (23 percent), 
Illinois (19 percent), Nebraska (18 percent), Ohio (10 percent), and 
Missouri (7 percent). This is the most recent official information on 
popcorn production released by the U.S. government.
    U.S. exports of popcorn totaled nearly 290 million pounds in 1995, 
with a value of $64.7 million. According to the Snack Food Association, 
retail sales of popcorn in the United States totaled $1.469 billion in 
1994.
    The popcorn Order authorizes an initial assessment on processors of 
5 cents per hundredweight. The Order provides that the rate of 
assessment may be raised or lowered as recommended by the Board and 
approved by the Secretary, but shall not exceed 8 cents per 
hundredweight in any fiscal year. At the maximum rate of assessment, it 
is estimated that $800,000 will be collected under the program. The 
promotion Board will be composed of processors, who will be 
knowledgeable of the impact of any proposed assessment on processors, 
and other small entities prior to recommending any change of the 
assessment rate to the Secretary.
    This Order is necessary to accomplish the statutory objectives, to 
strengthen the position of the popcorn industry in the marketplace, and 
to maintain and expand domestic and foreign markets and uses for 
popcorn.
    Over the past several years, the popcorn industry pursued several 
limited efforts to promote the sales and consumption of popcorn. These 
were financed primarily through voluntary contributions of some, but 
not all, popcorn processors. Under the limited and voluntary program, 
the resources available were not adequate to address the issues facing 
the industry from a national perspective and did not allow the industry 
to work collectively in an industry-wide manner.
    The Order provides the industry with the opportunity to 
collectively address issues in areas such as nutrition and quality, 
which individual processors could not effectively accomplish due to 
lack of resources.
    The industry considered pursuing a marketing order; however, 
industry believes that popcorn is not a commodity covered under the 
existing marketing order statute. Furthermore, the marketing order 
system did not lend itself to addressing the issues that the promotion 
legislation clearly addresses, for example, establishing the definition 
of a processor.
    In order to conduct the Regulatory Flexibility Analysis regarding 
the impact of this Order on small entities, the proposed rule that was 
published in the Federal Register on September 30, 1996 (61 FR 51046) 
invited comments concerning the potential effects of the proposed 
Order. No specific comments were received concerning the impact of the 
proposed order on small entities except that a comment from the Popcorn 
Institute did note that the order will be very beneficial to popcorn 
processors, especially small processors who will not otherwise be able 
to afford a nationwide comprehensive program.

Paperwork Reduction Act

    In accordance with the Office of Management and Budget (OMB) 
regulations (5 CFR Part 1320) which implement the Paperwork Reduction 
Act of 1995 [44 U.S.C. Chapter 35], the information collection and 
recordkeeping requirements that will be imposed by this Order were 
approved by OMB on December 16, 1996.
    Title: National Research, Promotion, and Consumer Information 
Programs.
    OMB Number: 0581-0093.
    Expiration Date of Approval: October 31, 1997.
    Type of Request: Revision of a currently approved information 
collection for research and promotion programs.
    Abstract: The information collection requirements in this request 
are essential to carry out the intent of the Act.
    While the Order will impose certain recordkeeping requirements on 
processors, information required under the Order could be compiled from 
records currently maintained. The Order's provisions have been 
carefully reviewed and every effort has been made to minimize any 
unnecessary recordkeeping costs or requirements.
    Although the Order will impose some additional costs and 
requirements, it is anticipated that the program under the Order will 
help to increase the demand and expand markets for popcorn. Therefore, 
any additional costs should be offset by the benefits derived from 
expanded markets and sales benefiting all segments of the popcorn 
industry.
    The forms require the minimum information necessary to effectively 
carry out the requirements of the program, and their use is necessary 
to fulfill the intent of the Act. Such information can be supplied 
without data processing equipment or outside technical expertise. In 
addition, there are no additional training requirements for individuals 
filling out reports and remitting assessments to the promotion Board. 
The forms will be simple, easy to understand, and place as small a 
burden as possible on the person required to file the information.
    Collecting information less frequently will hinder the Board from 
effectively carrying out the provisions of its program. Collecting 
information monthly coincides with normal business practices. Requiring 
reports less frequently than monthly will impose additional 
recordkeeping requirements by requiring information from several months 
to be consolidated prior to filling out the form rather than just 
copying end-of-month figures already available on to the forms. The 
timing and frequency of collecting information is intended to meet the 
needs of the industry while minimizing the amount of work necessary to 
fill out the required reports. In addition, the information to be 
included on these forms is not available from other sources because 
such information relates

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specifically to individual processors who are subject to or exempted 
from the provisions of the Act. Therefore, there is no practical method 
for collecting the required information without the use of these forms.
    The estimated cost in providing information to the Board by the 
estimated 67 respondents will be $19.28 per respondent annually. This 
total has been estimated by multiplying 129.15 (total burden hours 
requested) by $10.00 per hour, a sum deemed to be reasonable if the 
respondents were compensated for their time.
    A comment concerning the proposed Order's information collection 
requirements as published on September 30, 1996, in the Federal 
Register (61 FR 51046) was addressed in the proposed rule published in 
the Federal Register on March 21, 1997, (62 FR 13551).
    Information collection requirements that are included in this rule 
include:
    (1) A periodic report by each person who processes popcorn.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average .5 hours per each processor 
reporting on popcorn processed.
    Respondents: Processors.
    Estimated Number of Respondents: 35.
    Estimated Number of Responses per Respondent: 4.
    Estimated Total Annual Burden on Respondents: 70 hours.
    (2) An exemption application for processor of popcorn processing 4 
million pounds or less a year.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average .25 hours per response for each 
exempt processor.
    Respondents: Exempt processors.
    Estimated Number of Respondents: 32.
    Estimated Number of Responses per Respondent: 1.
    Estimated Total Annual Burden on Respondents: 8 hours.
    (3) A referendum ballot to be used to determine whether processors 
covered by the Order favor implementation or continuance of the Order.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average .25 hours per response for each 
processor.
    Respondents: Processors.
    Estimated Number of Respondents: 35.
    Estimated Number of Responses per Respondent: 1 every 3 years.
    Estimated Total Annual Burden on Respondents: 2.9 hours.
    (4) Nominations.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average .5 hours per response.
    Respondents: Processors.
    Estimated number of Respondents: 35.
    Estimated Number of Responses per Respondent: 1 every 3 years 
(.33).
    Estimated Total Annual Burden on Respondents: 5.75 hours.
    (5) Nominations background statement.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average .5 hours per response.
    Respondents: Processors.
    Estimated number of Respondents: 18 for initial Board and 6 
annually thereafter.
    Estimated Number of Responses per Respondent: 1.
    Estimated Total Annual Burden on Respondents: 9 hours for initial 
Board and 3 hours annually thereafter.
    (6) A requirement to maintain records sufficient to verify reports 
submitted under the Order.
    Estimate of Burden: Public recordkeeping burden for keeping this 
information is estimated to average .5 hours per recordkeeper 
maintaining such records.
    Recordkeepers: Processors.
    Estimated number of Recordkeepers: 67.
    Estimated Total Recordkeeping Hours: 33.5 hours.

Background

    The Act authorizes the Secretary of Agriculture (Secretary) to 
establish a popcorn promotion, research, and consumer information 
program. The program will be funded by an assessment on processors not 
to exceed 8 cents per hundredweight of popcorn.
    Assessments will be used to pay for: promotion, research, and 
consumer information; administration, maintenance, and functioning of 
the Board; and expenses incurred by the Secretary in implementing and 
administering the Order, including referendum costs.
    Consistent with the Act, processors will be required to maintain 
records regarding the collection, payment, or remittance of the 
assessments. All information obtained through processor reports will be 
kept confidential.
    Assessments will be collected in a manner prescribed by the Board. 
The collection of assessments will commence on all popcorn processed in 
the United States on or after the date established by the Secretary, 
and will continue until terminated by the Secretary.
    The Act requires the Secretary to conduct a referendum during the 
60-day period preceding the proposed Order's effective date. Popcorn 
processors of more than 4 million pounds annually are eligible to vote 
in the referendum to determine whether they favor the proposed Order's 
implementation. The proposed Order must be approved by a majority of 
eligible processors voting in the referendum, and processors favoring 
approval must process more than 50 percent of the total volume of 
popcorn processed by persons voting in the referendum. Subsequent 
referenda will be conducted not earlier than three years after the 
effective date of the proposed Order at the request of the Board or a 
representative group of processors covered by the proposed Order.
    The Act provided for the submission of proposals for a popcorn 
promotion, research, and consumer information order by industry 
organizations or any other interested person affected by the Act. As 
stated earlier, the Act requires that the proposed Order provide for 
the establishment of the Board. The Board will be composed of nine 
members. Each member will serve a three-year term of office.
    The Department issued a news release on May 22, 1996, requesting 
proposals for an initial Order or portions of an initial Order.
    An entire proposed Order was submitted by the Institute. The 
Department slightly modified the Institute's proposed Order and 
published it on September 30, 1996, in the Federal Register (61 FR 
51046). Comments were to be received by November 29, 1996. Six comments 
concerning the proposed rulemaking were received. These comments were 
addressed in the proposed rule which was published in the Federal 
Register (62 FR 13533) on March 21, 1997.
    Also on March 21, the Department published a referendum order 
directing that the initial referendum be conducted from April 15 to 30, 
1997.
    The Order is summarized as follows:
    Sections 1215.1 through 1215.20 of the proposed Order define 
certain terms, such as popcorn, processor, and process, which are used 
in the proposed Order.
    Sections 1215.21 through 1215.30 include provisions relating to the 
establishment and membership of the Board; nominations and appointment; 
terms of office; vacancies; removal; procedure; compensation and 
reimbursement; powers; and duties of the Board. The Board will be the 
body organized to administer the Order through the implementation of

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programs, plans, projects, budgets, and contracts to promote and 
disseminate information about popcorn, under the supervision of the 
Secretary. Further, the Board will be authorized to incur expenses 
necessary for the performance of its duties and to set a reserve fund. 
Sections 1215.40 through 1215.41 and 1215.50 provide information on 
these activities.
    Sections 1215.51 through 1215.53 will authorize the collection of 
assessments, specify who pays them and how, and specifies individuals 
who will be exempt from paying the assessment. In addition, it will 
prohibit use of funds to influence government policy or action.
    Except as otherwise provided by the Board and approved by the 
Secretary, the rate of assessment will be 5 cents per hundredweight of 
popcorn.
    The assessment section also outlines the procedures to be followed 
by processors for remitting assessments and authorize a interest charge 
for unpaid or late assessments.
    Sections 1215.60 thorough 1215.62 concern reporting and 
recordkeeping requirements for persons subject to the Order and protect 
the confidentiality of information obtained from such books, records, 
or reports.
    Sections 1215.60 through 1215.63 describe the rights of the 
Secretary, authorize the Secretary to suspend or terminate the Order 
when deemed appropriate, and prescribe proceedings after suspension or 
termination.
    Sections 1215.64 through 1215.77 include the provisions involving 
personal liability of Board members and employees; handling of patents, 
copyrights, inventions, and others; amendments to the Order; and 
separability of Order provisions.

General Findings

    The Department conducted a referendum among popcorn processors from 
April 15 through 30, 1997, to determine whether the Order will become 
effective. The representative period for establishing voter eligibility 
was from January 1, through December 31, 1996. Only processors who 
processed over 4 million pounds of popcorn during this period were 
eligible to vote.
    It is determined that a majority of those who voted favored the 
implementation of the Order and that those voters favoring 
implementation represented a majority of processors voting in the 
referendum, which majority, annually processed more than 50 percent of 
the popcorn processed annually by all those voting in the referendum. 
After consideration of all relevant material presented, including the 
initial proposal, comments received, and the referendum results, it is 
found that the Order effectuates the declared policy of the Act.

List of Subjects in 7 CFR Part 1215

    Administrative practice and procedure, Advertising, Consumer 
information, Marketing agreements, Popcorn, Promotion, Reporting and 
recordkeeping requirements.

    For the reasons set forth in the preamble, Title 7, chapter XI of 
the Code of Federal Regulations is amended as follows:
    1. Part 1215 is added to read as follows:

PART 1215--POPCORN PROMOTION, RESEARCH, AND CONSUMER INFORMATION

Subpart A--Popcorn Promotion, Research, and Consumer Information Order

Definitions

Sec.
1215.1  Act.
1215.2  Board.
1215.3  Board member.
1215.4  Commerce.
1215.5  Consumer information.
1215.6  Department.
1215.7  Fiscal year.
1215.8  Industry Information.
1215.9  Marketing.
1215.10  Part and subpart.
1215.11  Person.
1215.12  Popcorn.
1215.13  Process.
1215.14  Processor.
1215.15  Programs, plans, and projects.
1215.16  Promotion.
1215.17  Research.
1215.18  Secretary.
1215.19  State.
1215.20  United States.

Popcorn Board

1215.21  Establishment and membership.
1215.22  Nominations and appointment.
1215.23  Acceptance.
1215.24  Term of office.
1215.25  Vacancies.
1215.26  Removal.
1215.27  Procedure.
1215.28  Compensation and reimbursement.
1215.29  Powers.
1215.30  Duties.

Promotion, Research, Consumer Information, and Industry information

1215.40  Programs, plans, and projects.
1215.41  Contracts.

Expenses and Assessments

1215.50  Budget and expenses.
1215.51  Assessments.
1215.52  Exemption from assessment.
1215.53  Influencing governmental action.

Reports, Books, and Records

1215.60  Reports.
1215.61  Books and records.
1215.62  Confidential treatment.

Miscellaneous

1215.70  Right of the Secretary.
1215.71  Suspension or termination.
1215.72  Proceedings after termination.
1215.73  Effect of termination or amendment.
1215.74  Personal liability.
1215.75  Patents, copyrights, inventions, publications, and product 
formulations.
1215.76  Amendments.
1215.77  Separability.

Subpart B--Rules and Regulations Definitions

1215.100   Terms defined.

Exemption Procedures

1215.300  Exemption procedures.

Miscellaneous

1215.400  OMB control numbers.

    Authority: 7 U.S.C. 7481-7491.

Subpart A--Popcorn Promotion, Research, and Consumer Information 
Order

Definitions


Sec. 1215.1  Act.

    Act means the Popcorn Promotion, Research, and Consumer Information 
Act of 1995, Subtitle E of Title V of the Federal Agriculture 
Improvement and Reform Act of 1996, Pub. L. 104-127, 7 U.S.C. 7481-
7491, and any amendments thereto.


Sec. 1215.2  Board.

    Board means the Popcorn Board established under section 575(b) of 
the Act.


Sec. 1215.3  Board member.

    Board member means an officer or employee of a processor appointed 
by the Secretary to serve on the Popcorn Board as a representative of 
that processor.


Sec. 1215.4  Commerce.

    Commerce means interstate, foreign, or intrastate commerce.


Sec. 1215.5  Consumer information.

    Consumer information means information and programs that will 
assist consumers and other persons in making evaluations and decisions 
regarding the purchasing, preparing, and use of popcorn.


Sec. 1215.6  Department.

    Department means the United States Department of Agriculture.


Sec. 1215.7  Fiscal year.

    Fiscal year means the 12-month period from January 1 through 
December 31 each year, or such other period as recommended by the Board 
and approved by the Secretary.

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Sec. 1215.8  Industry information.

    Industry information means information and programs that will lead 
to the development of new markets, new marketing strategies, or 
increased efficiency for the popcorn industry, or activities to enhance 
the image of the popcorn industry.


Sec. 1215.9  Marketing.

    Marketing means the sale or other disposition of unpopped popcorn 
for human consumption in a channel of commerce but shall not include 
sales or disposition to or between processors.


Sec. 1215.10  Part and subpart.

    Part means the Popcorn Promotion, Research, and Consumer 
Information Order and all rules and regulations and supplemental orders 
issued thereunder, and the term subpart means the Popcorn Promotion, 
Research, and Consumer Information Order.


Sec. 1215.11  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity.


Sec. 1215.12  Popcorn.

    Popcorn means unpopped popcorn (Zea Mays L) that is commercially 
grown, processed in the United States by shelling, cleaning, or drying, 
and introduced into a channel of commerce.


Sec. 1215.13  Process.

    Process means to shell, clean, dry, and prepare popcorn for the 
market, but does not include packaging popcorn for the market without 
also engaging in another activity described in this paragraph.


Sec. 1215.14  Processor.

    Processor means a person engaged in the preparation of unpopped 
popcorn for the market who owns or who shares the ownership and risk of 
loss of such popcorn and who processes and distributes over 4 million 
pounds of popcorn in the market per year.


Sec. 1215.15  Programs, plans, and projects.

    Programs, plans, and projects means promotion, research, consumer 
information, and industry information plans, studies, projects, or 
programs conducted pursuant to this part.


Sec. 1215.16  Promotion.

    Promotion means any action, including paid advertising, to enhance 
the image or desirability of popcorn.


Sec. 1215.17  Research.

    Research means any type of study to advance the image, 
desirability, marketability, production, product development, quality, 
or nutritional value of popcorn.


Sec. 1215.18  Secretary.

    Secretary means the Secretary of Agriculture of the United States 
or any officer or employee of the Department to whom authority has 
heretofore been delegated, or to whom authority may hereafter be 
delegated, to act in the Secretary's stead.


Sec. 1215.19  State.

    State means each of the 50 States and the District of Columbia.


Sec. 1215.20  United States.

    United States means all of the States.

Popcorn Board


Sec. 1215.21  Establishment and membership.

    (a) There is hereby established a Popcorn Board of nine members. 
The number of members on the Board may be changed by regulation: 
Provided, That the Board consist of not fewer than four members and not 
more than nine members. The Board shall be composed of popcorn 
processors appointed by the Secretary under Sec. 1215.24.
    (b) For purposes of nominating and appointing processors to the 
Board, the Secretary shall, to the extent practicable, take into 
account the geographic distribution of popcorn production.
    (c) No more than one officer or employee of a processor may serve 
as a Board member at the same time.


Sec. 1215.22  Nominations and appointment.

    (a) All nominations for appointments to the Board established under 
Sec. 1215.21 shall be made as follows:
    (1) As soon as practicable after the effective date of this 
subpart, nominations for appointment to the initial Board shall be 
obtained from processors by the Secretary. In any subsequent year in 
which an appointment to the Board is to be made, nominations for 
positions for which the term will expire at the end of that year shall 
be obtained from processors at least six months prior to the expiration 
of terms.
    (2) Except for initial Board members, whose nomination process will 
be initiated by the Secretary, the Board shall issue a call for 
nominations in each year for which an appointment to the Board is to be 
made. The call shall include, at a minimum, the following information:
    (i) A list of the vacancies for which nominees may be submitted and 
qualifications for nomination; and
    (ii) The date by which the names of nominees shall be submitted to 
the Secretary for consideration to be in compliance with paragraph (a) 
of this section.
    (3)(i) Nominations for each position shall be made by processors. 
Notice shall be publicized to all processors.
    (ii) All processors may participate in submitting nominations.
    (4) Two nominees must be submitted for each vacancy. If processors 
fail to nominate a sufficient number of nominees, additional nominees 
shall be obtained in a manner prescribed by the Secretary.
    (b) The Secretary shall appoint the members of the Board from 
nominations made in accordance with paragraph (a).
    (1) The Secretary may reject any nominee submitted. If there is an 
insufficient number of nominees from whom to appoint members to the 
Board as a result of the Secretary's rejecting such nominees, 
additional nominees shall be submitted to the Secretary in a manner 
prescribed by the Secretary.
    (2) Whenever processors cannot agree on nominees for a position on 
the Board under the preceding provisions of this section, or whenever 
they fail to nominate individuals for appointment to the Board, the 
Secretary may appoint members in such a manner as the Secretary 
determines appropriate.
    (3) If a processor nominates more than one officer or employee, 
only one may be appointed to the Board by the Secretary.


Sec. 1215.23  Acceptance.

    Each individual nominated for membership of the Board shall qualify 
by filing a written acceptance with the Secretary at the time of 
nomination.


Sec. 1215.24  Term of office.

    (a) The members of the Board shall serve for terms of three years, 
except that members appointed to the initial Board shall serve, to the 
extent practicable, proportionately for terms of two, three, and four 
years.
    (b)(1) Except with respect to terms of office of the initial Board, 
the term of office for each Board member shall begin on the date the 
member is seated at the Board's annual meeting or such other date that 
may be approved by the Secretary.
    (2) The term of office for the initial Board member shall begin 
immediately following the appointment by the Secretary.
    (c) Board members shall serve during the term of office for which 
they are appointed and have qualified, and until their successors are 
appointed and have qualified.
    (d) No Board member may serve more than two consecutive three-year 
terms,

[[Page 39391]]

except as provided in Sec. 1215.25(d). Initial members serving two- or 
four-year terms may serve one successive three-year term.


Sec. 1215.25  Vacancies.

    (a) To fill any vacancy occasioned by the death, removal, 
resignation, or disqualification of any member of the Board, the 
Secretary may appoint a successor from the most recent nominations 
submitted for positions on the Board or the Secretary may obtain 
nominees to fill such vacancy in such a manner as the Secretary deems 
appropriate.
    (b) Each such successor appointment shall be for the remainder of 
the term vacated.
    (c) A vacancy will not be required to be filled if the unexpired 
term is less than six months.
    (d) If an unexpired term is less than 1.5 years, serving the term 
shall not prevent the appointee from serving two successive three-year 
terms.
    (e) A Board member shall be disqualified from serving on the Board 
if such individual ceases to be affiliated with the processor the 
member represents.


Sec. 1215.26  Removal.

    If a member of the Board consistently refuses to perform the duties 
of a member of the Board, or if a member of the Board is known to be 
engaged in acts of dishonesty or willful misconduct, the Board may 
recommend to the Secretary that the member be removed from office. 
Further, without recommendation of the Board, a member may be removed 
by the Secretary upon showing of adequate cause, including the failure 
by a member to submit reports or remit assessments required under this 
part, if the Secretary determines that such member's continued service 
will be detrimental to the achievement of the purposes of the Act.


Sec. 1215.27  Procedure.

    (a) At a properly convened meeting of the Board, a majority of the 
members shall constitute a quorum.
    (b) Each member of the Board will be entitled to one vote on any 
matter put to the Board, and the motion will carry if supported by a 
simple majority of those voting. At assembled meetings of the Board, 
all votes will be cast in person.
    (c) In lieu of voting at a properly convened meeting and, when in 
the opinion of the chairperson of the Board such action is considered 
necessary, the Board may take action upon the concurring votes by a 
majority of its members by mail, telephone, facsimile, or any other 
means of communication. If appropriate, any such action shall be 
confirmed promptly in writing. In that event, all members must be given 
prior notice and provided the opportunity to vote. Any action so taken 
shall have the same force and effect as though such action had been 
taken at a properly convened meeting of the Board. All votes shall be 
recorded in Board minutes.
    (d) Meetings of the Board may be conducted by electronic 
communications, provided that each member is given prior notice of the 
meeting and has the opportunity to be present either physically or by 
electronic connection.
    (e) The organization of the Board and the procedures for conducting 
meetings of the Board shall be in accordance with its bylaws, which 
shall be established by the Board and approved by the Secretary.


Sec. 1215.28  Compensation and reimbursement.

    The members of the Board shall serve without compensation but shall 
be reimbursed for necessary and reasonable expenses incurred by such 
members in the performance of their responsibilities under this 
subpart.


Sec. 1215.29  Powers.

    The Board shall have the following powers:
    (a) To administer the Order in accordance with its terms and 
provisions;
    (b) To make rules and regulations to effectuate the terms and 
provisions of the Order;
    (c) To select committees and subcommittees of Board members, 
including an executive committee, and to adopt such bylaws and other 
rules for the conduct of its business as it may deem advisable;
    (d) To appoint or employ such individuals as it may deem necessary, 
define the duties, and determine the compensation of such individuals;
    (e) To disseminate information to processors or industry 
organizations through programs or by direct contact using the public 
postal system or other systems;
    (f) To propose, receive, evaluate and approve budgets, plans and 
projects of popcorn promotion, research, consumer information and 
industry information, as well as to contract with the approval of the 
Secretary with appropriate persons to implement plans and projects.
    (g) To receive, investigate, and report to the Secretary for action 
any complaints of violations of the Order;
    (h) To recommend to the Secretary amendments to the order;
    (i) To accept or receive voluntary contributions;
    (j) To invest, pending disbursement pursuant to a program, plan or 
project, funds collected through assessments authorized under this Act 
provided for in Sec. 1215.51, and any other funds received by the Board 
in, and only in, obligations of the United States or any agency 
thereof, in general obligations of any State or any political 
subdivision thereof, in any interest bearing account or certificate of 
deposit or a bank that is a member of the Federal Reserve System, or in 
obligations fully guaranteed as to principal and interest by the United 
States.
    (k) With the approval of the Secretary, to enter into contracts or 
agreements with national, regional, or State popcorn processor 
organizations, or other organizations or entities, for the development 
and conduct of programs, plans or projects authorized under 
Sec. 1215.40 and for the payment of the cost of such programs with 
assessments received pursuant to this subpart; and
    (1) Such other powers as may be approved by the Secretary.


Sec. 1215.30  Duties.

    The Board shall have the following duties:
    (a) To meet not less than annually, and to organize and select from 
among its members a chairperson and such other officers as may be 
necessary;
    (b) To evaluate or develop, and submit to the Secretary for 
approval, promotion, research, consumer information, and industry 
information programs, plans or projects;
    (c) To prepare for each fiscal year, and submit to the Secretary 
for approval at least 60 days prior to the beginning of each fiscal 
year, a budget of its anticipated expenses and disbursements in the 
administration of this subpart, as provided in Sec. 1215.50;
    (d) To maintain such books and records, which shall be available to 
the Secretary for inspection and audit, and to prepare and submit such 
reports from time to time to the Secretary, as the Secretary may 
prescribe, and to make appropriate accounting with respect to the 
receipt and disbursement of all funds entrusted to it;
    (e) To prepare and make public, at least annually, a report of its 
activities carried out, and an accounting for funds received and 
expended;
    (f) To cause its financial statements to be prepared in conformity 
with generally accepted accounting principles and to be audited by an 
independent certified public accountant

[[Page 39392]]

in accordance with generally accepted auditing standards at least once 
each fiscal year and at such other times as the Secretary may request, 
and submit a copy of each such audit to the Secretary;
    (g) To give the Secretary the same notice of meetings of the Board 
as is given to members in order that the Secretary, or a representative 
of the Secretary, may attend such meetings;
    (h) To submit to the Secretary such information as may be requested 
pursuant to this subpart;
    (i) To keep minutes, books and records that clearly reflect all the 
acts and transactions of the Board. Minutes of each Board meeting shall 
be promptly reported to the Secretary;
    (j) To act as intermediary between the Secretary and any processor;
    (k) To investigate violations of the Act, order, and regulations 
issued under the order, conduct audits, and report the results of such 
investigations and audits to the Secretary for appropriate action to 
enforce the provisions of the Act, order, and regulations; and
    (l) To work to achieve an effective, continuous, and coordinated 
program of promotion, research, consumer information, and industry 
information designed to strengthen the popcorn industry's position in 
the marketplace, maintain and expand existing markets and uses for 
popcorn, develop new markets and uses for popcorn, and to carry out 
programs, plans, and projects designed to provide maximum benefits to 
the popcorn industry.

Promotion, Research, Consumer Information, and Industry Information


Sec. 1215.40  Programs, plans, and projects.

    (a) The Board shall receive and evaluate, or on its own initiative 
develop, and submit to the Secretary for approval any program, plan or 
project authorized under this subpart. Such programs, plans or projects 
shall provide for:
    (1) The establishment, issuance, effectuation, and administration 
of appropriate programs for promotion, research, consumer information, 
and industry information with respect to popcorn; and
    (2) The establishment and conduct of research with respect to the 
sale, distribution, marketing, and use of popcorn, and the creation of 
new uses thereof, to the end that the marketing and use of popcorn may 
be encouraged, expanded, improved, or made more acceptable.
    (b) No program, plan, or project shall be implemented prior to its 
approval by the Secretary. Once a program, plan, or project is so 
approved, the Board may take appropriate steps to implement it.
    (c) Each program, plan, or project implemented under this subpart 
shall be reviewed or evaluated periodically by the Board to ensure that 
it contributes to an effective program of promotion, research, consumer 
information, or industry information. If it is found by the Board that 
any such program, plan, or project does not contribute to an effective 
program of promotion, research, consumer information, or industry 
information, then the Board shall terminate such program, plan, or 
project.
    (d) In carrying out any program, plan, or project, no reference to 
a brand name, trade name, or State or regional identification of any 
popcorn will be made. In addition, no program, plan, or project shall 
make use of unfair or deceptive acts or practices with respect to the 
quality, value, or use of any competing product.


Sec. 1215.41  Contracts.

    The Board shall not contract with any processor for the purpose of 
promotion or research. The Board may lease physical facilities from a 
processor for such promotion or research, if such an arrangement is 
determined to be cost effective by the Board and approved by the 
Secretary. Any contract or agreement shall provide that:
    (a) The contractor or agreeing party shall develop and submit to 
the Board a program, plan or project together with a budget or budgets 
that shall show the estimated cost to be incurred for such program, 
plan, or project;
    (b) Any such program, plan, or project shall become effective upon 
approval by the Secretary;
    (c) The contracting or agreeing party shall keep accurate records 
of all of its transactions and make periodic reports to the Board of 
activities conducted, submit accountings for funds received and 
expended, and make such other reports as the Secretary or the Board may 
require; and the Secretary may audit the records of the contracting or 
agreeing party periodically; and
    (d) Any subcontractor who enters into a contract with a Board 
contractor and who receives or otherwise uses funds allocated by the 
Board shall be subject to the same provisions as the contractor.

Expenses and Assessments


Sec. 1215.50  Budget and expenses.

    (a) At least 60 days prior to the beginning of each fiscal year, 
and as may be necessary thereafter, the Board shall prepare and submit 
to the Secretary a budget for the fiscal year covering its anticipated 
expenses and disbursements in administering this subpart.
    (b) Each budget shall include:
    (1) A rate of assessment for such fiscal year calculated, subject 
to Sec. 1215.51(b), to provide adequate funds to defray its proposed 
expenditures and to provide for a reserve as set forth in paragraph (g) 
of this section;
    (2) A statement of the objectives and strategy for each program, 
plan, or project;
    (3) A summary of anticipated revenue, with comparative data for at 
least one preceding year;
    (4) A summary of proposed expenditures for each program, plan, or 
project; and
    (5) Staff and administrative expense breakdowns, with comparative 
data for at least one preceding year.
    (c) In budgeting plans and projects of promotion, research, 
consumer information, and industry information, the Board shall expend 
assessment and contribution funds on:
    (1) Plans and projects for popcorn marketed in the United States or 
Canada in proportion to the amount of assessments projected to be 
collected on domestically marketed popcorn (including Canada); and
    (2) Plans and projects for exported popcorn in proportion to the 
amount of assessments projected to be collected on exported popcorn 
(excluding Canada).
    (d) The Board is authorized to incur such reasonable expenses, 
including provision for a reasonable reserve, as the Secretary finds 
are reasonable and likely to be incurred by the Board for its 
maintenance and functioning, and to enable it to exercise its powers 
and perform its duties in accordance with the provisions of this 
subpart. Such expenses shall be paid from funds received by the Board.
    (e) The Board may accept voluntary contributions, but these shall 
only be used to pay expenses incurred in the conduct of programs, 
plans, and projects approved by the Secretary. Such contributions shall 
be free from any encumbrances by the donor and the Board shall retain 
complete control of their use. The Board may also receive funds 
provided through the Foreign Agricultural Service of the United States 
Department of Agriculture for foreign marketing activities.
    (f) As stated in section 75(f)(4)(A)(ii) of the Act, the Board 
shall reimburse the Secretary, from funds received by the Board, for 
costs incurred by the Secretary in implementing and administering this 
subpart: Provided, That the costs incurred by the Secretary to be 
reimbursed by the Board, excluding legal costs to defend and enforce 
the order, shall not exceed 15

[[Page 39393]]

percent of the projected annual revenues of the Board.
    (g) The Board may establish an operating monetary reserve and may 
carry over to subsequent fiscal periods excess funds in any reserve so 
established, except that the funds in this reserve shall not exceed 
approximately one fiscal year's expenses. Such reserve funds may be 
used to defray any expenses authorized under this subpart.
    (h) With the approval of the Secretary, the Board may borrow money 
for the payment of administrative expenses, subject to the same fiscal, 
budget, and audit controls as other funds of the Board during its first 
year of operation only.


Sec. 1215.51  Assessments.

    (a) Any processor marketing popcorn in the United States or for 
export shall pay an assessment on such popcorn at the time of 
introduction to market at a rate as established in Sec. 1215.51(c) and 
shall remit such assessment to the Board in such form and manner as 
prescribed by the Board.
    (b) Any person marketing popcorn of that person's own production to 
consumers in the United States either directly or through retail or 
wholesale outlets, shall remit to the Board an assessment on such 
popcorn at the rate set forth in paragraph Sec. 1215.51(c), and in such 
form and manner as prescribed by the Board.
    (c) Except as otherwise provided, the rate of assessment shall be 5 
cents per hundredweight of popcorn. The rate of assessment may be 
raised or lowered as recommended by the Board and approved by the 
Secretary, but shall not exceed 8 cents per hundredweight in any fiscal 
year.
    (d) The collection of assessments under this section shall commence 
on all popcorn processed in the United States on or after the date 
established by the Secretary, and shall continue until terminated by 
the Secretary. If the Board is not constituted on the date the first 
assessments are to be collected, the Secretary shall have the authority 
to receive assessments on behalf of the Board and may hold such 
assessments until the Board is constituted, then remit such assessments 
to the Board.
    (e) Each person responsible for remitting assessments under 
paragraphs (a) and (b) of this section shall remit the amounts due from 
assessments to the Board on a quarterly basis no later than the last 
day of the month following the last month in the previous quarter in 
which the popcorn was marketed, in such manner as prescribed by the 
Board.
    (f) The Board shall impose a late payment charge on any person who 
fails to remit to the Board the total amount for which the person is 
liable on or before the payment due date established under this 
section. The amount of the late payment charge shall be prescribed in 
rules and regulations as approved by the Secretary.
    (g) The Board shall impose an additional charge on any person 
subject to a late payment charge, in the form of interest on the 
outstanding portion of any amount for which the person is liable. The 
rate of interest shall be prescribed in rules and regulations as 
approved by the Secretary.
    (h) In addition, persons failing to remit total assessments due in 
a timely manner may also be subject to penalties and actions under 
federal debt collection procedures as set forth in 7 CFR 3.1 through 
3.36.
    (i) Any assessment that is determined to be owing at a date later 
than the payment due established under this section, due to a person's 
failure to submit a report to the Board by the payment due date, shall 
be considered to have been payable on the payment due date. Under such 
a situation, paragraphs (f), (g), and (h) of this section shall be 
applicable.
    (j) The Board, with the approval of the Secretary, may enter into 
agreements authorizing other organizations or entities to collect 
assessments on its behalf. Any such organization or entity shall be 
required to maintain the confidentiality of such information as is 
required by the Board for collection purposes. Any reimbursement by the 
Board for such services shall be based on reasonable charges for 
services rendered.
    (k) The Board is hereby authorized to accept advance payment of 
assessments for the fiscal year by any person, that shall be credited 
toward any amount for which such person may become liable. The Board 
shall not be obligated to pay interest on any advance payment.


Sec. 1215.52  Exemption from assessment.

    (a) Persons that process and distribute 4 million pounds or less of 
popcorn annually, based on the previous year, shall be exempted from 
assessment.
    (b) To claim such exemption, such persons shall apply to the Board, 
in the form and manner prescribed in the rules and regulations.


Sec. 1215.53  Influencing governmental action.

    No funds received by the Board under this subpart shall in any 
manner be used for the purpose of influencing legislation or 
governmental policy or action, except to develop and recommend to the 
Secretary amendments to this subpart.

Reports, Books, and Records


Sec. 1215.60  Reports.

    (a) Each processor marketing popcorn directly to consumers, and 
each processor responsible for the remittance of assessments under 
Sec. 1215.51, shall be required to report quarterly to the Board, on a 
form provided by the Board, such information as may be required under 
this subpart or any rule and regulations issued thereunder. Such 
information shall be subject to Sec. 1215.62 and include, but not be 
limited to, the following:
    (1) The processor's name, address, telephone number, and Social 
Security Number or Employer Identification Number;
    (2) The date of report, which is also the date of payment to the 
Board;
    (3) The period covered by the report;
    (4) The number of pounds of popcorn marketed or in any other manner 
are subject to the collection of assessments;
    (5) The amount of assessments remitted;
    (6) The basis, if necessary, to show why the remittance is less 
than the number of pounds of popcorn divided by 100 and multiplied by 
the applicable assessment rate; and
    (7) The amount of assessments remitted on exports (not including 
Canada).
    (b) The words ``final report'' shall be shown on the last report at 
the end of each fiscal year.


Sec. 1215.61  Books and records.

    Each person who is subject to this subpart shall maintain and make 
available for inspection by the Board or the Secretary such books and 
records as are deemed necessary by the Board, with the approval of the 
Secretary, to carry out the provisions of this subpart and any rules 
and regulations issued hereunder, including such books and records as 
are necessary to verify any reports required. Such books and records 
shall be retained for at least two years beyond the fiscal year of 
their applicability.


Sec. 1215.62  Confidential treatment.

    (a) All information obtained from books, records, or reports under 
the Act, this subpart, and the rule and regulations issued thereunder 
shall be kept confidential by all persons, including all employees, 
agents, and former employees and agents of the Board; all officers, 
employees, agents, and former officers, employees, and agents of the 
Department; and all officers, employees, agents, and former officers, 
employees, and agents of contracting and subcontracting agencies

[[Page 39394]]

or agreeing parties having access to such information. Such information 
shall not be available to Board members or processors. Only those 
persons having a specific need for such information to administer 
effectively the provisions of this part shall have access to such 
information. Only such information so obtained as the Secretary deems 
relevant shall be disclosed by them, and then only in a suit or 
administrative hearing brought at the direction, or on the request, of 
the Secretary, or to which the Secretary or any officer of the United 
States is a party, and involving this part.
    (b) No information obtained under the authority of this part may be 
made available to any agency or officer of the Federal Government for 
any purpose other than the implementation of the Act and any 
investigatory or enforcement action necessary for the implementation of 
the Act.
    (c) Nothing in paragraph (a) of this section may be deemed to 
prohibit:
    (1) The issuance of general statements based upon the reports of 
the number of persons subject to this part or statistical data 
collected therefrom, which statements do not identify the information 
furnished by any person;
    (2) The publication, by direction of the Secretary, of the name of 
any person who has violated this part, together with a statement of the 
particular provisions of this part violated by such person.
    (d) Any person who knowingly violated the provisions of this 
section, on conviction, shall be subject to a fine of not more than 
$1,000 or to imprisonment for not more than 1 year, or both, or if the 
person is an officer, employee, or agent of the Board or the 
Department, that person shall be removed from office or terminated from 
employment as applicable.

Miscellaneous


Sec. 1215.70  Right of the Secretary.

    All fiscal matters, programs, plans, or projects, contracts, rules 
or regulations, reports, or other substantive actions proposed and 
prepared by the Board shall be submitted to the Secretary for approval.


Sec. 1215.71  Suspension or termination.

    (a) Whenever the Secretary finds that this subpart or any provision 
thereof obstructs or does not tend to effectuate the declared policy of 
the Act, the Secretary shall terminate or suspend the operation of this 
subpart or such provision thereof.
    (b) The Secretary may conduct additional referenda to determine 
whether processors favor termination or suspension of this subpart 
three years after the effective date, on the request of a 
representative group comprising 30 percent or more of the number of 
processors who have been engaged in processing during a representative 
period as determined by the Secretary.
    (c) Whenever the Secretary determines that suspension or 
termination of this subpart is favored by two-thirds or more of the 
popcorn processors voting in a referendum under paragraph (b) of this 
section who, during a representative period determined by the 
Secretary, have been engaged in the processing, the Secretary shall:
    (1) Suspend or terminate, as appropriate, collection of assessments 
within six months after making such determination; and
    (2) Suspend or terminate, as appropriate, all activities under this 
subpart in an orderly manner as soon as practicable.
    (d) Referenda conducted under this subsection shall be conducted in 
such manner as the Secretary may prescribe.


Sec. 1215.72  Proceedings after termination.

    (a) Upon the termination of this subpart, the Board shall recommend 
not more than five of its members to the Secretary to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Secretary, shall become trustees of all the 
funds and property owned, in the possession of, or under the control of 
the Board, including any claims unpaid or property not delivered, or 
any other claim existing at the time of such termination.
    (b) The trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Board under any contract or 
agreement entered into by it under this subpart;
    (3) From time to time account for all receipts and disbursements, 
and deliver all property on hand, together with all books and records 
of the Board and of the trustees, to such persons as the Secretary may 
direct; and
    (4) Upon the request of the Secretary, execute such assignments or 
other instruments necessary or appropriate to vest in such other 
persons full title and right to all of the funds, property, and claims 
vested in the Board or the trustees under this subpart.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered under this subpart shall be subject to the 
same obligations imposed upon the Board and upon the trustees.
    (d) Any residual funds not required to defray the necessary 
expenses of liquidation shall be turned over to the Secretary to be 
used, to the extent practicable, in the interest of continuing one or 
more of the promotion, research, consumer information or industry 
information programs, plans, or projects authorized under this subpart.


Sec. 1215.73  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any rule and regulation issued under 
this subpart, or the issuance of any amendment to such provisions, 
shall not:
    (a) Affect or waive any right, duty, obligation, or liability that 
shall have arisen or may hereafter arise in connection with any 
provision of this subpart or any such rules or regulations;
    (b) Release or extinguish any violation of this subpart or any such 
rules or regulations; or
    (c) Affect or impair any rights or remedies of the United States, 
the Secretary, or any person with respect to any such violation.


Sec. 1215.74  Personal liability.

    No member or employee of the Board shall be held personally 
responsible, either individually or jointly, in any way whatsoever, to 
any person for errors in judgment, mistakes, or other acts of either 
commission or omission of such member or employee under this subpart, 
except for acts of dishonesty or willful misconduct.


Sec. 1215.75   Patents, copyrights, inventions, publications, and 
product formulations.

    Any patents, copyrights, inventions, publications, or product 
formulations developed through the use of funds received by the Board 
under this subpart shall be the property of the United States 
Government as represented by the Board and shall, along with any rents, 
royalties, residual payments, or other income from the rental, sale, 
leasing, franchising, or other uses of such patents, copyrights, 
inventions, publications, or product formulations inure to the benefit 
of the Board and be considered income subject to the same fiscal, 
budget, and audit controls as other funds of the Board. Upon 
termination of this subpart, Sec. 1215.72 shall apply to determine 
disposition of all such property.


Sec. 1215.76  Amendments.

    Amendments to this subpart may be proposed, from time to time, by 
the Board or by any interested persons affected by the provisions of 
the Act, including the Secretary.

[[Page 39395]]

Sec. 1215.77  Separability.

    If any provision of this subpart is declared invalid, or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart or the applicability 
thereof to other persons or circumstances shall not be affected 
thereby.

Subpart B--Rules and Regulations


Sec. 1215.100  Terms defined.

    Unless otherwise defined in this subpart, the definitions of terms 
used in this subpart shall have the same meaning as the definitions in 
Subpart A--Popcorn Promotion, Research, and Consumer Information Order 
of this part.

Exemption Procedures


Sec. 1215.300  Exemption procedures.

    (a) Any processor who markets 4 million pounds or less of popcorn 
annually and who desires to claim an exemption from assessments during 
a fiscal year as provided in Sec. 1214.52 of this part shall apply to 
the Board, on a form provided by the Board, for a certificate of 
exemption. Such processor shall certify that the processor's marketing 
of popcorn during the previous fiscal year was 4 million pounds or 
less.
    (b) Upon receipt of an application, the Board shall determine 
whether an exemption may be granted. The Board then will issue, if 
deemed appropriate, a certificate of exemption to each person that is 
eligible to receive one.
    (c) Any person who desires to renew the exemption from assessments 
for a subsequent fiscal year shall reapply to the Board, on a form 
provided by the Board, for a certificate of exemption.
    (d) The Board may require persons receiving an exemption from 
assessments to provide to the Board reports on the disposition of 
exempt popcorn.

Miscellaneous


Sec. 1215.400  OMB control numbers.

    The control number assigned to the information collection 
requirements by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35, is OMB control 
number 0581-0093, except for the Promotion Board nominee background 
statement form which is assigned OMB control number 0505-0001.

    Dated: July 16, 1997.
Lon Hatamiya,
Administrator, Agricultural Marketing Service.
[FR Doc. 97-19150 Filed 7-21-97; 8:45 am]
BILLING CODE 3410-02-P