[Federal Register Volume 64, Number 73 (Friday, April 16, 1999)]
[Proposed Rules]
[Pages 18831-18833]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-9658]


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 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 64, No. 73 / Friday, April 16, 1999 / 
Proposed Rules  

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1220

[No. LS-98-001]


Soybean Promotion and Research Program: Request for Referendum

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This action would change the number of eligible soybean 
producers estimated in the proposed ``Request for Referendum'' on the 
Soybean Promotion and Research Order (Order) as published in the 
September 4, 1998, Federal Register and would amend the regulations 
accordingly. The estimated number of eligible soybean producers would 
change from 381,000 soybean producers to 600,813 soybean producers 
based on the results of a statistical survey.

DATES: Written comments must be received by May 17, 1999.

ADDRESSES: Send two copies of comments to Ralph L. Tapp, Chief; 
Marketing Programs Branch; Livestock and Seed Program, Agricultural 
Marketing Service (AMS), USDA; STOP-0251; 1400 Independence Avenue, 
SW.; Washington, D.C. 20250-0251. Comments will be available for public 
inspection during regular business hours in Room 2627 South Agriculture 
Building; 14th and Independence Avenue, SW., Washington, D.C.

FOR FURTHER INFORMATION CONTACT: Ralph L. Tapp, Chief, Marketing 
Programs Branch, 202/720-1115.

SUPPLEMENTARY INFORMATION:

Regulatory Impact Analysis

Executive Order 12866 and 12988 and the Regulatory Flexibility Act and 
the Paperwork Reduction Act

    The Department of Agriculture (Department) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. It is not intended to have a retroactive effect. This 
rule would not preempt State or local laws, regulations, or policies, 
unless they present an irreconcilable conflict with this rule.
    The Soybean Promotion, Research, and Consumer Information Act (Act) 
provides that administrative proceedings must be exhausted before 
parties may file suit in court. Under Sec. 1971 of the Act, a person 
subject to the 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 an exemption from the Order. The 
petitioner is afforded the opportunity for a hearing on the petition. 
After a hearing the Secretary will rule on the petition. The statute 
provides that the district court of the United States in any district 
in which the petitioner resides or carries on business has jurisdiction 
to review the Secretary's decision if a complaint for that purpose is 
filed not later than 20 days after the date of the entry of the 
Secretary's decision.
    Further, Sec. 1974 of the Act provides, with certain exceptions, 
that nothing in the Act may be construed to preempt or supersede any 
other program relating to soybean promotion, research, consumer 
information, or industry information organized and operated under the 
laws of the United States or any State. One exception in the Act 
concerns assessments collected by the Qualified State Soybean Boards 
(QSSBs). The exception provides that to ensure adequate funding of the 
operations of QSSBs under the Act, no State law or regulation may limit 
or have the effect of limiting the full amount of assessments that a 
QSSB in that State may collect, and which is authorized to be credited 
under the Act. Another exception concerns certain referendums conducted 
during specified periods by a State relating to the continuation or 
termination of a QSSB or State soybean assessment.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (5 United States Code (U.S.C.) 601 et seq.), the Administrator of 
AMS has considered the economic effect of this proposed action on small 
entities and has determined that its implementation will not have a 
significant economic impact on a substantial number of small business 
entities.
    According to the statistical survey initiated by the Department, 
there are 600,813 soybean producers who would be eligible to 
participate in the ``Request for Referendum.'' The majority of 
producers subject to the Order are small businesses under the criteria 
established by the Small Business Administration.
    Further, the requirements set forth in the proposed rule are 
substantially similar to the rules that established the eligibility and 
participation requirements for a July 26, 1995, soybean producer poll 
published as a final rule on March 22, 1995 (60 FR 15027), in the 
Federal Register.
    The procedures to request a referendum would not impose a 
substantial burden or have a significant impact on persons subject to 
the Order. Further, participation is not mandatory. Not all persons 
subject to the Order are expected to participate. The Department would 
determine producer eligibility.
    In compliance with the Office of Management and Budget (OMB) 
regulations [5 CFR Part 1320] which implements the Paperwork Reduction 
Act [44 U.S.C. 3501 et seq.], the information collection requirements 
contained in this proposed rule have been previously approved by OMB 
and were assigned OMB control number 0581-0093. The information 
collection requirements in the proposed rule include the following:
    (1) Any eligible person who requests a referendum must legibly 
print his/her name, or if applicable, the producer entity represented, 
address, telephone number, and county on the ``Request for a Soybean 
Referendum'' form (Form LS-51-1). Each person must read the 
certification statement on the form and sign it certifying that he/she 
or the producer entity represented meets the eligibility requirements. 
Form LS-51-1 shall be obtained in person, by mail, telephone, or 
facsimile from the county Farm Service Agency (FSA) office where FSA 
maintains and processes the producer's administrative farm records or 
at the county FSA office serving the county where the producer owns or 
rents land. Form LS-51-1 may be returned by mail, by facsimile, or in 
person to the same county FSA office

[[Page 18832]]

where the form was obtained. A producer or producer entity 
representative who obtains Form LS-51-1 in person during the ``Request 
for Referendum'' period from the appropriate county FSA office may 
complete Form LS-51-1 at that time. The estimated average time burden 
for completing the procedure is 5 minutes per person.
    (2) Using information from each returned Form LS-51-1, county FSA 
personnel shall enter the producer's name, and if applicable, producer 
entity representative, the date received (and the postmarked date for 
mailed requests), and the method the form was received on the ``List of 
Soybean Producers Requesting a Referendum'' (Form LS-51-2). This 
information may be used for the purpose of challenging the eligibility 
of producers. Many county FSA offices will use more than one Form LS-
51-2 depending on the number of producers requesting a referendum. 
Because only county FSA office personnel would be required to complete 
Form LS-51-2, the time required to complete this form is not included 
in the estimated average reporting burden for a producer.

Background

    The Act (7 U.S.C. 6301-6311) provides for the establishment of a 
coordinated program of promotion and research designed to strengthen 
the soybean industry's position in the marketplace and to maintain and 
expand domestic and foreign markets and uses for soybeans and soybean 
products. The program is financed by an assessment of 0.5 of one 
percent of the net market price of soybeans sold by producers. Pursuant 
to the Act, an Order was made effective July 9, 1991, and the 
collection of assessments began September 1, 1991.
    The Act required that an initial referendum be conducted no earlier 
than 18 months and no later than 36 months after the issuance of the 
Order to determine whether the Order should be continued.
    The initial referendum was conducted on February 9, 1994. On April 
1, 1994, the Secretary announced that of the 85,606 valid ballots cast, 
46,060 (53.8 percent) were in favor of continuing the Order and the 
remaining 39,546 votes (46.2 percent) were against continuing the 
Order. The Act required approval by a simple majority for the Order to 
continue.
    The Act also required that within 18 months after the Secretary 
announced the results of the initial referendum, the Secretary would 
conduct a poll among producers to determine if producers favored a 
referendum on the continuance of the payment of refunds under the 
Order.
    A July 25, 1995, nationwide poll of soybean producers did not 
generate sufficient support for a refund referendum to be held based on 
the total number of producers in the United States established at that 
time. A refund referendum would have been held if at least 20 percent 
(not in excess of one-fifth of which may be producers in any one State) 
of the 381,000 producers (76,200) nationwide requested it. Only 48,782 
soybean producers participated in the poll. Consequently, refunds were 
discontinued on October 1, 1995.
    The Act also specifies that the Secretary shall, 5 years after the 
conduct of the initial referendum and every 5 years thereafter, provide 
soybean producers an opportunity to request a referendum on the Order.
    For all such referendums, if the Secretary determines that at least 
10 percent of U.S. producers engaged in growing soybeans (not in excess 
of one-fifth of which may be producers in any one State) support the 
conduct of a referendum, the Secretary must conduct a referendum within 
1 year of that determination. If these requirements are not met, a 
referendum would not be conducted.
    On September 4, 1998, AMS published a proposed ``Request for 
Referendum'' rule in the Federal Register (63 FR 47200). The proposed 
rule set forth procedures to be followed in conducting the ``Request 
for Referendum.'' The proposed rule included provisions concerning 
definitions, supervision of the process for requesting a referendum, 
eligibility, certification and request procedures, counting and 
reporting results, and disposition of the forms and records. The 
proposed rule also provided that the ``Request for Referendum,'' be 
conducted at the county FSA offices and that FSA assist AMS by 
determining eligibility, counting, and reporting results. Finally, the 
proposed rule provided that the Secretary would use the latest official 
number of U.S. soybean farms as reported by the Department's National 
Agricultural Statistics Service (NASS) as representing the total number 
of U.S. soybean producers. At the time the proposed rule was published, 
the latest official data available and reported by NASS was based on 
the 1992 Census of Agriculture (1992 Census) which showed that 381,000 
farms produced soybeans.
    Comments on the proposed rule were due in the Department by October 
5, 1998. The Department received six comments from State and national 
soybean organizations concerning the Department's estimated number of 
soybean producers eligible to participate in the ``Request for 
Referendum.'' Four comments were filed on time and two comments were 
filed after the comment period ended. The late comments generally 
expressed the same views as the timely comments. In addition, six other 
comments were received addressing other matters in the September 4, 
1998, proposed rule will be discussed in a final rule.
    The four comments timely received expressed the belief that the 
381,000 soybean farms reported by the 1992 Census and proposed by the 
Department as the total number of soybean producers grossly understates 
the true number of soybean producers. Furthermore, the commenters 
believed that the 1992 Census data (1) was outdated, (2) did not 
provide a proper basis for determining the number of soybean producers, 
and (3) did not reflect the current number of producers which they 
believed had increased since the enactment of the 1996 Farm Bill. Two 
commenters recommended that AMS utilize the results of the United 
Soybean Board's (Board) recent survey of soybean producers, which was 
based on FSA's data, or use other relevant information to determine the 
number of soybean farmers eligible to request a referendum. The Board's 
survey suggested that there could be as many as 649,000 soybean 
producers in the United States which is significantly more soybean 
producers than reflected in the 1992 Census data. Further, the most 
recent Census data for 1997 as reported by NASS indicated that there 
are 354,692 soybean farms. Accordingly, in order to better address this 
issue, AMS contracted with an independent surveyor to conduct a survey 
of soybean producers.
    AMS obtained a list from FSA of approximately 970,000 producers who 
produced soybeans, or who produced forage or hay which may have 
included soybeans during crop years 1995-97. AMS then developed a 
survey from this information designed to determine the number of 
producers which meet the definition of a soybean producer contained in 
the Act.
    To achieve 95 percent confidence in the survey results with a 2 
percent margin of error, the surveyor would obtain over 2,400 ``yes'' 
or ``no'' responses from those interviewed regarding their soybean 
producer status. Those interviewed were asked to respond only after 
listening to the definition of soybean producer provided under 
Sec. 1967 of the Act as read by the

[[Page 18833]]

caller. The definition of producer is ``any person engaged in the 
growing of soybeans in the United States who owns, or who shares the 
ownership and risk of loss of, such soybeans.''
    On March 5, 1999, AMS received the results of the soybean producer 
survey. AMS, also, reviewed the methods used for conducting the soybean 
producer survey to ensure that the procedures outlined by AMS were 
followed. The results indicated that approximately 62 percent of those 
surveyed were soybean producers as defined in the Act. Thus, based on 
the results, for the purposes of the ``Request for Referendum,'' AMS 
proposes to use 600,813 as the total number of U.S. soybean producers. 
This number would serve as the basis for determining whether a soybean 
referendum would be conducted. A soybean referendum would be conducted 
if requested by 10 percent of the total number of U.S. soybean 
producers (not in excess of one-fifth of which may be producers in any 
one State) engaged in the growing of soybeans.
    Since the basis for establishing the total number of producers 
would no longer be NASS data, Sec. 1220.30(d) of the proposed rule 
would be amended by deleting the phrase ``* * * the latest official 
numbers of U.S. soybean farms as reported by the Department's National 
Agricultural Statistics Service as the total number of producers.'' and 
inserting the phrase ``* * * the number of soybean producers in the 
United States is determined to be 600,813.''
    A 30-day comment period is provided for interested persons to 
comment on this amended proposed rule. This comment period is deemed 
appropriate because the Act provides that the Secretary, 5 years after 
the conduct of the initial referendum held in 1994, will give soybean 
producers the opportunity to request an additional referendum on the 
Order. A 30-day comment period will assist in timely implementation of 
this rule consistent with the provisions of the Act.

List of Subjects in 7 CFR Part 1220

    Administrative practice and procedure, Advertising, Agricultural 
research, Marketing agreements, Reporting and recordkeeping 
requirements, Soybeans and soybean products.

    For the reasons set forth in the preamble, it is proposed that 7 
CFR part 1220 be amended as follows:

PART 1220--SOYBEAN PROMOTION, RESEARCH, AND CONSUMER INFORMATION

    1. The authority citation for part 1220 would continue to read as 
follows:

    Authority: 7 U.S.C. 6301-6311.

Subpart F--Procedures to Request a Referendum Procedures

    2. In Sec. 1220.30, as proposed at 63 FR 47202, September 4, 1998, 
paragraph (d) is further proposed to be revised to read as follows:


Sec. 1220.30  General.

* * * * *
    (d) For purposes of paragraphs (b) and (c) of this section, the 
number of soybean producers in the United States is determined to be 
600,813.

    Dated: April 13, 1999.
Barry L. Carpenter,
Deputy Administrator, Livestock and Seed Program.
[FR Doc. 99-9658 Filed 4-14-99; 11:18 am]
BILLING CODE 3410-02-P