[Federal Register Volume 63, Number 246 (Wednesday, December 23, 1998)]
[Rules and Regulations]
[Pages 70994-70996]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-33932]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1065
[Docket No. DA-98-11]
Milk in the Nebraska-Western Iowa Marketing Area; Termination of
Certain Provisions of the Order
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: This rule terminates the advertising and promotion provisions
of the Nebraska-Western Iowa Federal milk order (Order 65) with respect
to milk marketed on or after December 1, 1998. Termination of the
provisions was requested by Dairy Farmers of America and North Central
Associated Milk Producers, Inc., two associations of dairy farmers who
represent approximately 90 percent of the producers whose milk is
pooled under the order. Since a majority of the producers on the market
request the removal of the advertising and promotion provisions from
the order, the program should be terminated.
EFFECTIVE DATES: The effective date for Secs. 1065.73(a)(2)(viii),
1065.107 and 1065.121(a) is December 1, 1998. The effective date for
Secs. 1065.105 through 1065.122 is March 31, 1999.
FOR FURTHER INFORMATION CONTACT: Constance M. Brenner, Marketing
Specialist, USDA/AMS/Dairy Division, Order Formulation Branch, Room
2971, South Building, P.O. Box 96456, Washington, DC 20090-6456 (202)
720-2357, e-mail address Connie__M__B[email protected].
SUPPLEMENTARY INFORMATION: The Department is issuing this rule in
conformance with Executive Order 12866.
This final rule has been reviewed under Executive Order 12988,
Civil Justice Reform. This rule terminates assessments for the
Nebraska-Western Iowa milk order advertising and promotion program on
milk marketed on and after December 1, 1998. This rule will not preempt
any state or local laws, regulations, or policies, unless they present
an irreconcilable conflict with this rule.
The Agricultural Marketing Agreement Act of 1937, as amended (7
U.S.C. 601-674), provides that administrative proceedings must be
exhausted before parties may file suit in court. Under section
608c(15)(A) of the Act, any handler subject to an order may request
modification or exemption from such order by filing 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. A handler 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 handler is an inhabitant, or has its
principal place of business, has jurisdiction in equity to review the
Secretary's ruling on the petition, provided a bill in equity is filed
not later than 20 days after the date of the entry of the ruling.
Small Business Consideration
In accordance with the Regulatory Flexibility Act (5 U.S.C. 601 et
seq.), the Agricultural Marketing Service has considered the economic
impact of this action on small entities and has certified that this
rule will not have a significant economic impact on a substantial
number of small entities. For the purpose of the Regulatory Flexibility
Act, a dairy farm is considered a ``small business'' if it has an
annual gross revenue of less than $500,000, and a dairy products
manufacturer is a ``small business'' if it has fewer than 500
employees. For the purposes of determining which dairy farms are
``small businesses,'' the $500,000 per year criterion was used to
establish a production guideline of 326,000 pounds per month. Although
this guideline does not factor in additional monies that may be
received by dairy producers, it should be an inclusive standard for
most ``small'' dairy farmers. For purposes of determining a handler's
size, if the plant is part of a larger company operating multiple
plants that collectively exceed the 500-employee limit, the plant will
be considered a large business even if the local plant has fewer than
500 employees.
Six milk handlers operating 4 pool distributing and 3 pool supply
plants are regulated under the Nebraska-
[[Page 70995]]
Western Iowa milk order, and the milk of 1,111 dairy farmers (559 of
whom are located in Nebraska) is pooled under the order. This rule
would terminate the advertising and promotion program provisions of the
Nebraska-Western Iowa order (7 CFR Part 1065, Secs. 1065.105 through
1065.122 and a reference to Sec. 1065.107 in Sec. 1065.73(a)(2)(viii))
and the 10-cent per hundredweight assessment for the purpose of
operating the program on producer milk pooled under the order. However,
the total amount of assessments deducted from dairy farmer returns for
advertising and promotion should not be affected by this rule.
The Dairy and Tobacco Adjustment Act of 1983 (7 U.S.C. 4501 et
seq.) requires that a national assessment of 15 cents per hundredweight
be deducted from payments to all dairy farmers for milk marketed, with
up to 10 cents of that deduction able to be designated to go to
research and promotion programs designated under that Act as
``Qualified State or regional programs.'' The remaining 5-cent portion
of the national assessment is directed to go to the National Dairy
Promotion and Research Board (the Board). The 10-cent assessment under
the qualified Order 65 program totaled $118,515.94 for September 1998,
with $14,430.90 of that amount paid for Minnesota and South Dakota-
produced milk pooled under Order 65 to the Minnesota and South Dakota
qualified State promotion and research programs.
Upon termination of the Order 65 advertising and promotion program
provisions, a new statutorily-required Nebraska State program (which
also will be a qualified program) will begin to receive the 10-cent
portion of the 15-cent assessment for producers located within the
State of Nebraska. Producers located within the States of Iowa,
Missouri, Kansas and Colorado whose milk is pooled under Order 65 will
be able to designate these or other qualified programs to receive the
10-cent portion of their national assessment, or that portion will be
sent to the Board in addition to the required 5-cent assessment.
The Order 65 Advertising and Promotion Program is set up as a
voluntary program, with producers able to request refunds of
assessments. However, the 1983 Dairy and Tobacco Adjustment Act
requires that the entire assessment for promotion and research be
directed either to the Board or to qualified programs, effectively
eliminating the ability of any of the assessment to be refunded to
dairy farmers. Therefore, this termination will not change the amount
of assessments paid by dairy farmers for promotion and research
activities, but will eliminate the Order 65 advertising and promotion
agency.
The regulatory impact of the Federal order on milk handlers would
be reduced because the order would no longer require advertising and
promotion assessments to be sent to the Nebraska-Western Iowa
advertising and promotion agency. However, handlers still would be
required to remit producer assessments to the qualified program
established by Nebraska statute and the National Dairy Promotion and
Research Board (for the 559 Order 65 dairy farmers located in
Nebraska), or to other qualified programs and the National Dairy
Promotion and Research Board (for the 552 dairy farmers located outside
Nebraska whose milk is pooled under Order 65).
This order of termination is issued pursuant to the provisions of
the Agricultural Marketing Agreement Act (7 U.S.C. 601-674) and of the
order regulating the handling of milk in the Nebraska-Western Iowa
marketing area (7 CFR Part 1065).
Statement of Consideration
The termination, requested by Dairy Farmers of America and North
Central Associated Milk Producers, Inc., associations of dairy farmers
whose milk is pooled on the Nebraska-Western Iowa Federal milk order,
will eliminate the advertising and promotion provisions of that order.
This action terminates funding for the program with respect to milk
marketed on and after December 1, 1998. The other provisions of the
program are terminated effective March 31, 1999. Such timing will
facilitate the orderly termination of the program's activities funded
with monies collected on milk marketed prior to December 1, 1998, and
will give the market administrator the time needed to complete audit
verification work and any other duties related to liquidation of the
program.
The Order 65 Advertising and Promotion Program requires a 10-cent
per hundredweight assessment on producer milk pooled under the order
for the purpose of operating the program.
In addition, the Dairy and Tobacco Adjustment Act of 1983 (7 U.S.C.
4501 et seq.) requires that a national assessment of 15 cents per
hundredweight be deducted from payments to all dairy farmers for milk
marketed, with up to 10 cents of that deduction able to be designated
to go to a qualified State or regional dairy product promotion,
research or nutrition education program, such as the voluntary
``Qualified State or regional program'' administered through the
Nebraska-Western Iowa order. The remaining 5-cent portion of the
national assessment is directed to go to the National Dairy Promotion
and Research Board (the Board). The 10-cent assessment under the
qualified Order 65 program totaled $118,515.94 for September 1998, with
$14,430.90 of that amount paid for Minnesota and South Dakota-produced
milk pooled under Order 65 to the Minnesota and South Dakota qualified
State promotion and research programs.
The State of Nebraska has enacted a state law (Nebraska State
Statute 2-3958) requiring the 10-cent portion of the 15-cent deduction
for milk produced in Nebraska to be sent to the State of Nebraska for
disbursement to qualified programs that request funds. The new Nebraska
law is ready to take effect. However, a proviso included in the law
states that the Nebraska fund cannot begin operation until the
Nebraska-Western Iowa Federal order advertising and promotion program
has been terminated.
Section 608c(5)(I) of the Act provides that any Federal order
advertising and promotion provisions may be terminated separately
whenever the Secretary makes a determination that the provisions of
Section 608c(16)(B) for terminating an order have been met. Section
608c(16)(B) of the Agricultural Marketing Agreement Act requires that
the Secretary terminate an order whenever he finds that a majority of
the producers engaged in production of milk for the market during a
representative period favor termination, or that such dairy farmers
produced more than 50 percent of the milk produced for sale in the
market during such period.
Dairy Farmers of America and North Central Associated Milk
Producers, Inc., represent approximately 90 percent of the producers
and approximately 81% of the production of milk pooled under the
Nebraska-Western Iowa Federal milk order. The termination order
designates the month of September 1998 as the representative period for
the purpose of determining that the above described statutory
requirement is met.
Therefore, the aforesaid provisions of the order are hereby
terminated.
It is hereby found and determined that there is good cause for
dispensing with prior notice and comment and that thirty days' notice
of the effective date hereof is impractical, unnecessary and contrary
to the public interest in that:
(a) The termination is necessary to fulfill the statutory
requirements of
[[Page 70996]]
Sections 608c(5)(I) and 608c(16)(B) of the Act (7 U.S.C. 601-674);
(b) This termination does not require of persons affected
substantial or extensive preparation prior to the effective date; and
(c) The annual operation of the Order 65 advertising and promotion
program is based on milk marketed December 1 through November 30.
Therefore, good cause exists for making this order effective
without prior notice and comment, and less than 30 days from the date
of publication in the Federal Register.
List of Subjects in 7 CFR Part 1065
Milk marketing orders.
For the reasons set forth in the preamble, the following provisions
of 7 CFR Part 1065 are amended as follows:
PART 1065--MILK IN THE NEBRASKA-WESTERN IOWA MARKETING AREA
1. The authority citation for 7 CFR Part 1065 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
Sec. 1065.73 [Amended]
2. In Sec. 1065.73, paragraph (a)(2)(viii) is amended by removing
the language ``and for advertising and promotion pursuant to
Sec. 1065.107'' effective December 1, 1998.
Sec. 1065.107 [Removed]
3. Section 1065.107 is removed effective December 1, 1998.
Sec. 1065.121 [Amended]
4. In Section 1065.121, paragraph (e) is removed and reserved
effective December 1, 1998.
Secs. 1065.105 through 1065.122 [Removed]
5. Sections 1065.105 through 1065.122 and the undesignated center
heading preceding them are removed effective March 31, 1999.
Dated: December 16, 1998.
Richard M. McKee,
Deputy Administrator, Dairy Programs.
[FR Doc. 98-33932 Filed 12-22-98; 8:45 am]
BILLING CODE 3410-02-U