[Federal Register Volume 64, Number 144 (Wednesday, July 28, 1999)]
[Proposed Rules]
[Pages 40783-40784]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-19291]


      
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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. 144 / Wednesday, July 28, 1999 / 
Proposed Rules  

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1230

[No. LS-98-007]


Pork Promotion and Research

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: Pursuant to the Pork Promotion, Research, and Consumer 
Information Act (Act) of 1985 and the Pork Promotion, Research, and 
Consumer Information Order (Order) issued thereunder, this proposed 
rule would specify in the regulations requirements concerning paying 
and collecting feeder pig and market hog assessments. This proposed 
action would add a section to the regulations which implement the Order 
to provide that the producer who sells the animal must remit to the 
National Pork Board (Board) the assessment due if the purchaser of a 
feeder pig or market hog fails to collect and remit the assessment.

DATES: Written comments must be received by September 27, 1999.

ADDRESSES: Send two copies of comments to Ralph L. Tapp, Chief; 
Marketing Programs Branch, Room 2627-S; Livestock and Seed Program; 
Agricultural Marketing Service (AMS), USDA; STOP 0251; 1400 
Independence Avenue, SW; Washington, DC 20250-0251. Comments received 
may be inspected at this location between 8:00 a.m. and 4:30 p.m., 
Monday through Friday, except holidays. State that your comments refer 
to Docket No. LS-98-007.

FOR FURTHER INFORMATION CONTACT: Ralph L. Tapp, 202/720-1115.

SUPPLEMENTARY INFORMATION:

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

    The Department of Agriculture (USDA) is issuing this proposed rule 
in conformance with Executive Order 12866.
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. It is not intended to have a retroactive effect.
    The Act states that the statute is intended to occupy the field of 
promotion and consumer education involving pork and pork products and 
of obtaining funds thereof from pork producers and that the regulation 
of such activity (other than a regulation or requirement relating to a 
matter of public health or the provision of State or local funds for 
such activity) that is in addition to or different from the Act may not 
be imposed by a State.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under Sec. 1625 of the Act, a 
person subject to an Order may file a petition with the Secretary 
stating that such Order, a provision of such Order or an obligation 
imposed in connection with such Order is not in accordance with law; 
and requesting a modification of the Order or an exemption from the 
Order. Such person is afforded the opportunity for a hearing on the 
petition. After the Hearing, the Secretary would rule on the petition. 
The Act provides that the district court of the United States in the 
district in which the person resides or does business has jurisdiction 
to review the Secretary's determination, if a complaint is filed not 
later than 20 days after the date such person receives notice of such 
determination.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA)(5 U.S.C. 601 et seq.). The Administrator of AMS has 
considered the economic effect of this action on small entities and has 
determined that this proposed rule will not have a significant economic 
impact on a substantial number of small business entities. The purpose 
of RFA is to fit regulatory actions to the scale of businesses subject 
to such actions in order that small businesses will not be unduly 
burdened.
    In the December 29, 1998, issue of ``Hogs and Pigs,'' USDA's 
National Agricultural Statistics Service estimates that in 1998 the 
number of operations with hogs in the United States totaled 114,380. 
The majority of these operations subject to the Order are considered 
small businesses under the criteria established by the Small Business 
Administration. The proposed rule imposes no new burden on the 
industry. The Act and Order have payment and collection provisions for 
assessments. This rule further specifies the responsibility for the 
collection and remittance of assessments on feeder pigs and market hogs 
in the regulations. This rule would add a section to the regulations to 
provide that the producer who sells the animal must remit to the Board 
the assessment due if the purchaser of a feeder pig or market hog fails 
to collect and remit the assessment.
    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 part have been previously approved by OMB and were 
assigned OMB control number 0851-0093.

Background and Proposed Change

    The Act (7 U.S.C. 4801-4819) approved December 23, 1985, authorized 
the establishment of a national pork promotion, research, and consumer 
information program. The program was funded by an initial assessment 
rate of 0.25 percent of the market value of all porcine animals 
marketed in the United States and an equivalent amount of assessment on 
imported porcine animals, pork, and pork products. However, that rate 
was increased to 0.35 percent in 1991 (56 FR 51635) and to 0.45 percent 
effective September 3, 1995 (60 FR 29963). The final Order establishing 
a pork promotion, research, and consumer information program was 
published in the September 5, 1986, issue of the Federal Register (51 
FR 31898; as corrected, at 51 FR 36383, and amended at 53 FR 1909, 53 
FR 30243, 56 FR 4, 56 FR 51635, 60 FR 29963, 61 FR 29002, and 62 FR 
26205). Assessments began on November 1, 1986.
    For purposes of paying, collecting, and remitting assessments under 
the Order, porcine animals are divided into three categories: (1) 
Feeder pigs, (2) market hogs, and (3) breeding stock. Section 
1230.71(a) provides that producers producing in the United States a 
porcine animal raised as a feeder pig, market hog, or for breeding 
stock, that is sold are to pay an assessment on that animal unless the

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producer demonstrates to the Board by appropriate documentation that an 
assessment was previously paid on that animal in the same category. 
Section 1230.71(b)(1) provides that purchasers of feeder pigs and 
market hogs collect assessments on these animals from the producer. 
Under Sec. 1230.71 producers selling their own breeding stock must 
remit assessments to the Board. The Order further provides that for the 
purpose of collecting and remitting assessments on feeder pigs and 
market hogs, persons engaged as a commission merchant, auction market, 
or livestock market in the business of receiving such porcine animals 
for sale on commission for or on behalf of a producer are deemed to be 
the purchaser. Commission merchants, auction markets, or livestock 
markets who sell breeding stock on behalf of producers are required to 
collect and remit assessments.
    Collection and remittance of assessments from sales transactions 
involving market hogs and breeding stock have been highly successful 
since the assessment collections became effective in 1986. For example, 
according to the Board's records, assessments are being collected and 
remitted on 99 percent of all market hogs slaughtered commercially in 
the United States each year.
    Assessment collection and remittance on market hogs has been 
efficient and successful primarily because of the limited number of 
purchasers, i.e. meat packers, who purchase hogs from all sizes of 
production units. This centralization of collection points and their 
limited number facilitates remittance of assessments to the Board and 
reduces or eliminates compliance problems. However, in the marketing of 
feeder pigs, there are significantly greater numbers of purchasers 
which tend to complicate the collection and remittance process and 
increase the potential for compliance problems.
    The Order contemplates that the producer (seller) will pay the 
assessment on feeder pigs and the purchaser, who also may be a 
producer, will collect the assessment due and remit it to the Board. 
For market hogs, the Order contemplates that the producer (seller) will 
pay the assessment and the purchaser will collect the assessment due 
and remit it to the Board.
    Due to production and marketing changes within the feeder pig 
industry, an increasing number of high volume feeder pig production 
units (producers) are selling feeder pigs to large numbers of 
producers. Pursuant to Sec. 1230.71(b)(1) each of these producers must 
collect assessments from the seller and remit them to the Board. 
According to the Board, many feeder pig producers, regardless of the 
size of their operation, simplify payment by remitting the assessment 
on all feeder pigs they sell to facilitate the collection and 
remittance of assessments. However, the large number of purchasers 
involved in feeder pig sales complicates the collection and remittance 
process and makes compliance difficult.
    The primary focus concerning collection and remittance problems on 
feeder pigs are transactions commonly referred to as farm-to-farm sales 
of feeder pigs. These sales transactions typically involve two 
producers. Frequently, producers who purchase feeder pigs may not 
consider themselves to be purchasers under the Act and Order and 
consequently neither the seller nor the purchaser collects and/or 
remits assessments due. This is particularly the case in farm-to-farm 
feeder pig sales where producer purchasers may not consider themselves 
as purchasers in such transactions and therefore do not believe they 
are required to collect and remit assessments to the Board.
    To clarify the meaning of a purchaser for the purpose of collection 
and remittance of assessments for the sale of feeder pigs and also for 
market hogs and to specify that each producer who sells an animal for 
the first time as a feeder pig or market hog is obligated to pay the 
required assessment, this proposed rule would add a new section 
Sec. 1230.113 to the rules and regulations titled ``Collection and 
Remittance of Assessments for the Sale of Feeder Pigs and Market 
Hogs.'' That section would provide that purchasers of feeder pigs or 
market hogs shall collect assessments from producers if an assessment 
is due and shall remit those assessments to the Board pursuant to the 
provisions of Sec. 1230.71. Failure of the purchaser to collect such 
assessment from a producer shall not relieve the producer of the 
obligation to pay the assessment. If the purchaser fails to collect the 
assessment when an assessment is due pursuant to Sec. 1230.71, the 
producer (seller) shall remit the total amount of assessments due to 
the Board as set forth in Sec. 1230.111. This proposed change would 
facilitate enforcement of assessment collection in the Pork Promotion, 
Research, and Consumer Information Program.

List of Subjects in 7 CFR Part 1230

    Administrative practice and procedure, Advertising, Agricultural 
research, Marketing agreement, Meat and meat products, Pork and pork 
products.

    For the reasons set forth in the preamble, it is proposed that 7 
CFR Part 1230 be amended as follows:

PART 1230--PORK PROMOTION, RESEARCH, AND CONSUMER INFORMATION

    1. The authority citation for 7 CFR Part 1230 continues to read as 
follows:

    Authority: 7 U.S.C. 4801-4819.

    2. Paragraph Sec. 1230.113 would be added to read as follows:


Sec. 1230.113  Collection and Remittance of Assessments for the Sale of 
Feeder Pigs and Market Hogs.

    Pursuant to the provisions of Sec. 1230.71, purchasers of feeder 
pigs or market hogs shall collect assessments from producers if an 
assessment is due and shall remit those assessments to the Board. 
Failure of the purchaser to collect such assessment from a producer 
shall not relieve the producer of the obligation to pay the assessment. 
If the purchaser fails to collect the assessment when an assessment is 
due pursuant to Sec. 1230.71, the producer (seller) shall remit the 
total amount of assessments due to the Board as set forth in 
Sec. 1230.111.

    Dated: July 20, 1999.
Barry L. Carpenter,
Deputy Administrator, Livestock and Seed Program.
[FR Doc. 99-19291 Filed 7-27-99; 8:45 am]
BILLING CODE 3410-02-P