[Federal Register Volume 65, Number 120 (Wednesday, June 21, 2000)]
[Rules and Regulations]
[Pages 38409-38415]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-15724]


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DEPARTMENT OF AGRICULTURE

Farm Service Agency

7 CFR Part 784

RIN 0560-AG17


Lamb Meat Adjustment Assistance Program

AGENCY: Farm Service Agency, USDA.

ACTION: Interim rule with request for comments.

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SUMMARY: This interim rule sets forth the regulations for the Lamb Meat 
Adjustment Assistance Program as authorized by clause (3) of section 32 
of the Act of August 24, 1935, as amended. Producers of sheep and lambs 
may receive up to $30 million total, with a target of $10 million per 
year, in direct cash payments to help improve their production 
efficiencies and the marketability of lamb meat during the 3 year 
period from July 22, 1999, through

[[Page 38410]]

July 31, 2002. This action is designed to provide immediate financial 
assistance to sheep and lamb producers who have recently experienced 
low prices and poor market conditions.

DATES: Effective June 19, 2000. Comments on this rule must be received 
on or before July 21, 2000 in order to be assured of consideration. 
Comments on the information collections in this rule must be received 
by August 21, 2000, in order to be assured of consideration.

ADDRESSES: Comments should be mailed to Grady Bilberry, Director, Price 
Support Division (PSD), Farm Service Agency (FSA), United States 
Department of Agriculture (USDA), STOP 0512, 1400 Independence Avenue, 
SW., Washington, DC 20250-0512; telephone (202) 720-7901 or e-mail: 
[email protected]. Comments may be inspected in the 
Office of the Director, PSD, FSA, USDA, Room 4095 South Building, 
Washington, DC, between 8 a.m. and 4:30 p.m., Monday through Friday, 
except holidays. A copy of this interim rule is available on the PSD 
home page at http://www.fsa.usda.gov/dafp/psd/.

FOR FURTHER INFORMATION CONTACT: Danielle Cooke, (202) 720-1919.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This interim rule is issued in conformance with Executive Order 
12866 and has been determined to be significant and has been reviewed 
by the Office of Management and Budget.

Regulatory Flexibility Act

    It has been determined that the Regulatory Flexibility Act is not 
applicable to this rule because the Farm Service Agency (FSA) is not 
required by 5 U.S.C. 533 or any other provision of law to publish a 
notice of proposed rulemaking with respect to the subject matter of 
this rule.

Environmental Evaluation

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

Executive Order 12988

    This rule has been reviewed in accordance with Executive Order 
12988. The provisions of this rule preempt State laws to the extent 
such laws are inconsistent with the provisions of this rule. Before any 
legal action may be brought regarding determinations of this rule, the 
administrative appeal provisions set forth at 7 CFR part 780 must be 
exhausted.

Executive Order 12372

    This program is not subject to the provisions of Executive Order 
12372, which require intergovernmental consultation with State and 
local officials. See the notice related to 7 CFR part 3014, subpart V, 
published at 48 FR 29115 (June 24, 1983).

Unfunded Mandates Reform Act of 1995

    This rule contains no Federal mandates under the regulatory 
provisions of Title II of the Unfunded Mandates Reform Act of 1995 
(UMRA) for State, local, and tribal governments or the private sector. 
Thus, this rule is not subject to the requirements of sections 202 and 
205 of the UMRA.

Paperwork Reduction Act of 1995

    In accordance with the Paperwork Reduction Act of 1995, FSA has 
submitted an emergency information collection request (ICR) to OMB for 
the approval of the Lamb Meat Adjustment Assistance Program report as 
necessary for the proper functioning of the program.
    Title: Lamb Meat Adjustment Assistance Program.
    OMB Control Number: 0560--New.
    Type of Request: Request for a New Information Collection Package .
    Abstract: Sheep and lamb operations are eligible to receive direct 
payments provided they make certifications that attest to their 
eligibility to receive such payments. These operations must certify, as 
appropriate, with respect to: (1) The number of eligible rams 
purchased; (2) the number of sheep enrolled in an eligible sheep 
improvement program; (3) sheep and lamb facility improvements; (4) the 
number and condition of eligible slaughter and feeder lambs marketed; 
and (5) that the operation is still in the business of agricultural 
production. The information collection will be used by FSA to determine 
the program eligibility of the sheep and lamb operation in accordance 
with this subpart. FSA considers the information collected essential to 
prudent eligibility determinations and payment calculations. 
Additionally, without accurate information on sheep and lamb 
operations, the national payment rate would be inaccurate resulting in 
payments being made to ineligible recipients, and compromising the 
integrity and accuracy of the program.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 5 minutes per response.
    Respondents: Sheep and Lamb Operations.
    Estimated Number of Respondents: 60,000.
    Estimated Number of Responses per Respondent: 5
    Estimated Total Annual Burden on Respondents: 24,000 hours.
    Proposed topics for comment include: (a) Whether the collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information will have practical 
utility; (b) the accuracy of the agency's estimate of burden including 
the validity of the methodology and assumptions used; (c) ways to 
enhance the quality, utility, and clarity of the information collected; 
or (d) ways to minimize the burden of the collection of the information 
on those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology. Comments should be 
sent to the Desk Officer for Agriculture, Office of Information and 
Regulatory Affairs, Office of Management and Budget, Washington, DC 
20503 and to Grady Bilberry, Director, Price Support Division, Farm 
Service Agency, United States Department of Agriculture, STOP 0512, 
1400 Independence Avenue, SW, Washington, DC 20250-0512 or telephone 
(202) 720-7901.

Executive Order 12612

    It has been determined that this rule does not have sufficient 
Federalism implications to warrant the preparation of a Federalism 
Assessment. The provisions contained in this rule will not have a 
substantial direct effect on States or their political subdivisions, or 
on the distribution of power and responsibilities among the various 
levels of government.

Immediate Effectiveness of This Rule

    It has been determined that this rule should be issued as an 
interim rule, effective immediately, but subject to modification on the 
consideration of comments that are timely received. Delaying the 
implementation of the rule pending comment would be impracticable and 
contrary to the public interest, based on consideration of the 
provisions of Section 32 of the Act of August 24, 1935, as amended, the 
current market situation for lamb meat, and the lack of material 
adverse effect on other parties.

[[Page 38411]]

    On July 7, 1999, the President issued a declaration concerning lamb 
meat that directed the Secretary of Agriculture to implement adjustment 
assistance programs based on authorized programs to facilitate efforts 
of the domestic lamb industry to make a positive adjustment to import 
competition. Market conditions have deteriorated since July 1997. Lamb 
producers have been some of the hardest hit, suffering major losses 
during 1997 and 1998 due to record high imports of low-priced lamb 
meat, so there is a critical need for action. Furthermore, while the 
need for immediate assistance is critical, potential harm to other 
parties, resulting from the issuance of this rule as an interim rule is 
expected to be minimal.

The Small Business Regulatory Enforcement Fairness Act

    The finding made above, that this rule should be made effective 
immediately, applies for all purposes including, but not limited, to 
the provisions of section 808 of the Small Business Regulatory 
Enforcement Fairness Act (SBREFA) (5 U.S.C. 808), which provides that a 
rule may, without regard to certain special Congressional oversight 
measures provided for in SBREFA, take effect at such time as the agency 
may determine if the agency finds for good cause that public notice is 
impracticable, unnecessary, or contrary to the public interest. For the 
reasons set out, it has been determined that delay would be contrary to 
public interest and that the rule should be made effective immediately.

Background

    Clause (3) of section 32 of the Act of August 24, 1935, as amended, 
authorizes the Secretary of Agriculture to ``reestablish farmers' 
purchasing power by making payments in connection with the normal 
production of any agricultural commodity for domestic consumption.''
    During the past few years a number of factors have produced a 
serious economic crisis that threatens the existence of sheep and lamb 
producers throughout the United States. There are an estimated 66,800 
sheep and lamb operations in the United States that account for about 1 
percent of the value of all U.S. farm production. Sheep and lamb 
prices, marketings, and production have declined steadily since July 
1997. Lamb producers were one of the hardest hit segments of the sheep 
industry, suffering major losses during 1997 and 1998, when lamb meat 
imports reached record highs. Threatened by a surge of low-priced, 
imported lamb meat, many producers have lost the ability to remain 
competitive in the domestic marketplace.
    This rule addresses that situation by providing for a new program 
to be administered by FSA utilizing the foregoing authority. Payments 
to sheep and lamb operations under the program provided for by this 
rule will offset a portion of the per-head losses producers have 
incurred marketing their lambs and will help the U.S. lamb industry 
achieve sustained competitiveness, while respecting international trade 
obligations. The program will be administered in two parts, one part 
covering activities occurring in what is referred to in the rule as 
``Year 1'' ( the period running from July 22, 1999, and ending 
September 30, 2000) and the second part covering activities occurring 
in what are called ``Year 2'' and ``Year 3'' in the rules--those being 
respectively, the periods from August 1, 2000 through July 31, 2001, 
and August 1, 2001, through July 31, 2002. The rule contemplates that 
$30 million will be available for the program and limits expenditures 
to that amount with a provision for pro-rating payments in any program 
year in which the funds will be exhausted.
    Payments under this new program will provide those eligible for the 
payments with an immediate infusion of funds to help pay operating 
expenses and meet other financial obligations. ``Year 1'' payments will 
be available to sheep and lamb operations that: (1) Between July 22, 
1999, through September 30, 2000, purchased 90 day-old or older rams 
intended for breeding purposes which the operation held for at least 90 
days continuously thereafter and continue to hold or use for breeding 
purposes, when the payments are to be made; (2) made lamb or feedlot 
facility improvements during the same period; or (3) in that period, 
enrolled sheep in an eligible sheep improvement program. The 
improvement program can be the National Sheep Improvement Program 
operated by the American Sheep Industry Association, or a similar 
program, if approved by FSA, to assist sheep and lamb producers by 
genetically evaluating animals in a flock for maternal, growth, and 
wool traits or to otherwise provide equivalent benefits to the 
producer's herd.
    ``Year 1'' facility improvement payments will be made to sheep and 
lamb facilities only with respect to improvements that will be 
maintained and used in the sheep and lamb operation for at least the 
next 3 consecutive years from the date of the completion of the 
improvements. Eligible facility improvements may include, but are not 
limited to new and improved feedlots, lambing sheds, and shearing 
sheds. Eligible sheep and lamb operations in ``Year 1'' can receive up 
to $100 per eligible ram purchased, not to exceed $2,500 per operation; 
$.50 per head of eligible sheep enrolled in a sheep improvement 
program, not to exceed $500 per operation; and 20 percent of the sheep 
and lamb operation's eligible facility improvement costs, not to exceed 
$2,500 per operation. Accordingly, maximum payments to any operation 
during ``Year 1'' will be limited to $5,500 for the three parts of the 
``Year 1'' program. The rule also makes provision for limiting payments 
for rams to the extent that such purchases would produce a ratio of 
rams to ewes of less than 1 to 15. In addition, eligible lamb producers 
must have in 1999 gross annual revenue of $2.5 million or less. The 
purpose of this and other limitations on payments is to help target 
limited financial resources to individual producers who are relatively 
less able to finance lamb improvements.
    For ``Year 2'' and ``Year 3'', payments will be made, subject to 
the availability of funds, with respect to marketings of (1) slaughter 
lambs and (2) feeder lambs. ``Year 2'' payments will be made for such 
marketings during ``Year 2'' and ``Year 3'' payments will be made for 
corresponding marketings in that year. ``Year 2'' and ``Year 3'' have 
been separated so that separate sign-ups can be held, separate payments 
can be made, and to ease proration problems in the event that the 
claims under the program should eventually exceed the amount of the 
available funds.
    First, as to ``Year 2'' and ``Year 3'' marketings of slaughter 
lambs, the lambs must have been owned by the lamb-raising operation in 
the normal course of business for 30 days prior to the qualifying 
marketing and must produce a carcass which: (1) Grades ``USDA Yield 
Grade 2''; (2) has ``USDA Choice or Prime'' quality; (3) has a muscling 
confirmation score of ``Average Choice'' or better; and (4) has a 55 to 
75 pound dressed hot carcass weight.
    With respect to the other category of marketings for which ``Year 
2'' and ``Year 3'' payments can be made, ``feeder lambs'' are defined 
in this rule to be either ewes or wethers of less than 1 year of age 
that when sold are intended to be further fed a grain concentrate diet 
to reach an acceptable slaughter market weight. Payments for feeder 
lamb marketings will be made only if the lambs are, at the time of 
marketing, thick-muscled and large-framed lambs, as described in USDA 
Standards and were owned by the

[[Page 38412]]

operation for 30 days, continuously immediately prior to the qualifying 
marketing. In addition, lamb producers eligible for payments must have 
in 1999 and subsequent years, an applicable gross annual revenue of 
$2.5 million or less.
    Subject to the availability of funds, the per-head ``Year 2'' and 
``Year 3'' payment rate is set by the rule to be $5 for each eligible 
slaughter lamb marketing and $3 for each eligible feeder lamb 
marketing. An additional $3 per slaughter lamb payment will be made for 
slaughter lambs marketed from June 1 through July 31 of the program 
year. For slaughter lambs, an Agricultural Marketing Service (AMS) 
agent or an assigned representative of AMS must verify that lamb 
carcasses meet the payment criteria. The condition of qualifying feeder 
lambs must also be certified to by the AMS agent or an assigned AMS 
representative.
    Payments for parts of this program (Years 1-3) are available to all 
eligible U.S. operations without herd or per operation or per person 
payment limitations, except as noted.
    Eligible sheep and lamb operations making application for payments 
under this part must self-certify, as applicable: (1) The number of 
eligible rams purchased, as well as, information establishing the ratio 
of rams to ewes on the operation for all relevant times during the 
program year to which such information applies; (2) the number of sheep 
enrolled in a sheep improvement program; (3) the lamb or feedlot 
facility improvements during ``Year 1''; (4) the intent to use the 
improvement for sheep production activities for the next 3 consecutive 
years; (5) the number of slaughter lamb and feeder lamb marketings that 
meet the specified criteria; and (6) the operation must also certify 
that it is still engaged in the business of producing and marketing 
agricultural products at the time of application for payment. Eligible 
operations must apply for payments during the sign-up period set by the 
FSA pursuant to these regulations.
    Sheep and lamb operations may, during the applicable period, apply 
in person at county FSA offices during regular business hours. 
Alternatively, program applications may be obtained by mail, telephone, 
and facsimile from their designated county FSA office or obtained via 
the Internet. The Internet website is located at www.fsa.usda.gov/dafp/psd/.

List of Subjects in 7 CFR Part 784

    Price support programs, Reporting and recordkeeping requirements, 
Sheep.

    Accordingly, Title 7 of the Code of Federal Regulations is amended 
to add a new part, 7 CFR part 784, to read as follows:

PART 784--LAMB MEAT ADJUSTMENT ASSISTANCE PROGRAM

Sec.
784.1   Applicability; available payments.
784.2   Administration.
784.3   Definitions.
784.4   Year 1 time and method for application.
784.5   Year 1 eligibility.
784.6   Year 1 rate of payment and limitations on funding.
784.7   Year 2 and Year 3 time and method for application.
784.8   Year 2 and Year 3 eligibility.
784.9   Year 2 and Year 3 rate of payment.
784.10   Availability of funds for Year 1 through Year 3.
784.11   Appeals.
784.12   Misrepresentation and scheme or device.
784.13   Estates, trusts, and minors.
784.14   Death, incompetency, or disappearance.
784.15   Maintaining records.
784.16   Refunds; joint and several liability.

    Authority: Clause (3) of section 32 of the Act of August 24, 
1935, as amended; 7 U.S.C. 612c.


Sec. 784.1  Applicability; available payments.

    (a) This part establishes the Lamb Meat Adjustment Assistance 
Program. The purpose of this program is to provide benefits to sheep 
and lamb operations pursuant to clause (3) of section 32 of the Act of 
August 24, 1935, as amended (7 U.S.C. 612c) in order to reestablish 
their purchasing power in connection with the normal production of 
sheep and lambs for domestic consumption and boost the long-term 
development and growth of sheep and lamb farming in the United States.
    (b) Under and subject to this part, FSA will provide with respect 
to sheep and lamb operations: ``Year 1'' payments in which sheep and 
lamb operations will receive payments for, during the time period 
encompassing ``Year 1'' as defined in these regulations, purchasing 
eligible rams for breeding, enrolling their herd in a sheep improvement 
program, and for making improvements to their production facilities; 
and ``Year 2'' and ``Year 3'' payments for marketings of eligible 
slaughter lambs or feeder lambs during the period encompassing those 
time periods. Unless otherwise determined by the agency in accordance 
with the provisions of this part, the amount that may be expended under 
this part shall not exceed $30 million. Claims that exceed that amount 
will be prorated in accordance with the provisions for proration that 
are contained in this part.


Sec. 784.2  Administration.

    (a) This part shall be administered by the Farm Service Agency 
(FSA) under the general direction and supervision of the Deputy 
Administrator for Farm Programs, FSA. The program shall be carried out 
in the field by FSA State and county committees (State and county 
committees).
    (b) State and county committees, and representatives and employees 
thereof, do not have the authority to modify or waive any of the 
provisions of the regulations in this part.
    (c) The State committee shall take any action required by this part 
which has not been taken by the county committee. The State committee 
shall also:
    (1) Correct, or require a county committee to correct, any action 
taken by such county committee which is not in accordance with the 
regulations of this part; or
    (2) Require a county committee to withhold taking any action which 
is not in accordance with the regulations of this part.
    (d) No delegation herein to a State or county committee shall 
preclude the Deputy Administrator for Farm Programs, FSA, or a 
designee, from determining any question arising under the program or 
from reversing or modifying any determination made by a State or county 
committee.
    (e) The Deputy Administrator for Farm Programs, FSA, may authorize 
State and county committees to waive or modify deadlines and other 
program requirements in cases where timeliness or failure to meet such 
other requirements does not adversely affect the operation of the 
program.


Sec. 784.3  Definitions.

    The definitions set forth in this section shall be applicable for 
all purposes of administering the Lamb Meat Adjustment Assistance 
Program established by this part.
    Agricultural Marketing Service or AMS means the Agricultural 
Marketing Service of the Department.
    Application means the Lamb Meat Adjustment Assistance Program 
Application, Forms FSA-382 and FSA-383.
    Department means the United States Department of Agriculture.
    Eligible lambs means feeder lambs and slaughter lambs.
    Farm Service Agency or FSA means the Farm Service Agency of the 
Department.
    Feeder lamb means a ewe or wether of less than 1 year of age that 
when sold

[[Page 38413]]

is intended to be further fed a grain concentrate diet to reach an 
acceptable slaughter market weight.
    Muscling confirmation score of ``Average Choice'' means a muscling 
confirmation score of that designation assigned in accordance with 
official USDA standards and procedures.
    Person means any individual, group of individuals, partnership, 
corporation, estate, trust, association, cooperative, or other business 
enterprise or other legal entity who is, or whose members are, a 
citizen or citizens of, or legal resident alien or aliens in the United 
States.
    Secretary means the Secretary of the United States Department of 
Agriculture or any other officer or employee of the Department who has 
been delegated the authority to act in the Secretary's stead with 
respect to the program established in this part.
    Sheep and lamb operation means any self-contained, separate 
enterprise operated as an independent unit exclusively within the 
United States in which a person or group of persons raise sheep and/or 
lambs.
    Sheep improvement program means the ``National Sheep Improvement 
Program'' operated by the American Sheep Industry Association or other 
similar program for herd improvement approved by the FSA with respect 
to payments under this part.
    Slaughter lamb means a lamb that is sold for immediate slaughter.
    United States means the 50 States of the United States of America, 
the District of Columbia, and the Commonwealth of Puerto Rico.
    USDA Choice, USDA Prime, USDA Yield Grade 2 means, respectively, 
the classifications so designated under the Official United States 
Standards for Grades of Lamb, Yearling, Mutton, and Mutton Carcasses 
promulgated by the Secretary of Agriculture under the Agricultural 
Marketing Act of 1946, as amended (60 Stat. 1087; 7 U.S.C. 1621-1627) 
and related authorities.
    Year 1 means the period of time beginning July 22, 1999, and ending 
September 30, 2000.
    Year 2 means the period of time beginning August 1, 2000, and 
ending July 31, 2001.
    Year 3 means the period of time beginning August 1, 2001, and 
ending July 31, 2002.


Sec. 784.4  Year 1 time and method for application.

    (a) Sheep and lamb producers may obtain a ``Year 1'' application, 
Form FSA-382 (Lamb Meat Adjustment Assistance Program Payment 
Application), in person, by mail, by telephone, or by facsimile from 
any county FSA office. In addition, applicants may download a copy of 
the Form FSA-382 at http://www.usda.gov/dafp/psd/.
    (b) A request for ``Year 1'' benefits under this part must be 
submitted on a completed Form FSA-382. The Form FSA-382 should be 
submitted to the FSA county office serving the county where the sheep 
and lamb operation is located but, in any case, must be received by the 
FSA county office by the close of business on October 13, 2000. 
Applications not received by the close of business on October 13, 2000, 
will be returned as not having been timely filed and the sheep and lamb 
operation filing the application will not be eligible for benefits 
under this program.
    (c) The sheep and lamb operation requesting ``Year 1'' benefits 
under this part must certify to the accuracy of the information 
provided in their application for benefits. All information provided is 
subject to verification and spot checks by FSA. Refusal to allow FSA or 
any other agency of the Department of Agriculture to verify any 
information provided will result in a determination of ineligibility. 
Data furnished by the applicant will be used to determine eligibility 
for program benefits. Furnishing the data is voluntary; however, 
without it program benefits will not be approved. Providing a false 
certification may be subject to additional civil and criminal 
sanctions.
    (d) Not withstanding any other provisions of this section, payments 
will not be made under this section for the acquisition of rams to the 
extent that any such purchase, at any time during ``Year 1'', created, 
or help create, a ratio of rams to ewes for the operation that was less 
than 1 ram to 15 ewes. However, the limitation on payments provided for 
in the preceding sentence shall not apply to the extent that the 
operation establishes to the satisfaction of the COC that a lower ratio 
of rams to ewes is customary for the operation.


Sec. 784.5  Year 1 eligibility.

    (a) To be eligible to receive the ``Year 1'' payments under this 
part, as described in Sec. 784.1, at the rates provided in Sec. 784.6, 
a sheep and lamb operation must be engaged in the business of producing 
and marketing agricultural products at the time of filing the 
application, must have in 1999 gross annual revenue of $2.5 million or 
less, and must have done at least one of the following during ``Year 
1'':
    (1) Purchased rams for breeding purposes within that operation, 
provided that such rams must have been at least 90 days of age when 
purchased and must have been, or will be, maintained by the operation 
for at least 90 days continuously after the date of purchase;
    (2) Enrolled sheep in an eligible sheep improvement program; or
    (3) Made sheep and lamb operation facility improvements with 
respect to their operation.
    (b) With respect to paragraph (a)(3) of this section, in order to 
receive payments, the sheep and lamb operation must submit supporting 
documentation of the cost of the improvements made to the facility 
during program ``Year 1'' and must use facility improvements for sheep 
and lamb production activities continuously for at least the next 3 
consecutive years. Upon a failure to maintain the facility for the full 
three years, the operation must refund the ``Year 1'' facility payment 
immediately and with interest.
    (c) With respect to payments made for activities addressed in 
paragraph (a)(1) of this section, upon any failure to maintain a ram 
after payment for the full required 90-day period, unless that period 
has already expired, the operation must immediately refund the payment 
made and with interest.


Sec. 784.6  Year 1 rate of payment and limitations on funding.

    Subject to the availability of funds and to the proration rules of 
Sec. 784.10, ``Year 1'' payments for qualifying operations shall be at 
the following rates:
    (a) Up to $100 for each eligible ram purchased, up to $2,500 per 
sheep and lamb operation;
    (b) $.50 for each qualifying sheep enrolled in a qualifying sheep 
improvement program, up to $500 per sheep and lamb operation; plus
    (c) 20% of the cost of the qualifying facility improvements up to 
$2,500 per sheep and lamb operation.


Sec. 784.7  Year 2 and Year 3 time and method for application.

    (a) To receive ``Year 2'' and ``Year 3'' benefits, as described in 
Sec. 784.1, at rates set out in Sec. 784.9, sheep and lamb operations 
may obtain an application, Form FSA-383 (Lamb Meat Adjustment 
Assistance Program Payment Application), in person, by mail, by 
telephone, or by facsimile from any county FSA office. In addition, 
applicants may download a copy of the Form FSA-383 at http://www.fsa.usda.gov/dafp/psd/.
    (b) Sheep and lamb operations must have the certification section 
of the application Form FSA-383 completed prior to submission of the 
form to the county office.
    (c) A request for ``Year 2'' and ``Year 3'' benefits under this 
part must be

[[Page 38414]]

submitted on a completed Form FSA-383. The Form FSA-383 should be 
submitted to the FSA county office serving the county where the sheep 
and lamb operation is located but, in any case, must be received by the 
FSA county office by the close of business on August 15, 2001, if 
applying for ``Year 2'' benefits, and by the close of business on 
August 15, 2002, if applying for ``Year 3'' benefits. Applications not 
received by the respective deadlines will be returned as not having 
been timely filed and the sheep and lamb operation will not be eligible 
for the benefits which were the subject of the failed application.
    (d) The sheep and lamb operation requesting benefits under this 
part must certify to the accuracy of the information provided in their 
application for benefits. All information provided is subject to 
verification and spot checks by FSA. Refusal to allow FSA or any other 
agency of the Department of Agriculture to verify any information 
provided will result in a determination of ineligibility. Data 
furnished by the applicant will be used to determine eligibility for 
program benefits. Furnishing the data is voluntary; however, without it 
program benefits will not be approved. Providing a false certification 
to the Government is punishable by imprisonment, fines and other 
penalties.


Sec. 784.8  Year 2 and Year 3 eligibility.

    (a) Subject to the availability of funds, ``Year 2'' and ``Year 3'' 
payments will, as described to in Sec. 784.1, be made for eligible 
marketings of slaughter lambs for slaughter. (Criteria for feeder lamb 
payments appear elsewhere in this section). Such payments for slaughter 
lambs, as opposed to feeder lambs, can be received by an operation, at 
the rates described in Sec. 784.9, for those eligible lambs slaughtered 
in the respective time periods comprising ``Year 2'' and ``Year 3'' if 
the lambs were owned, by the operation, in the normal course of raising 
lambs for slaughter, continuously for 30 days prior to the marketing 
for slaughter and if the carcasses produced by the slaughter of the 
lamb meets the criteria set out in paragraph (b) of this section. Other 
criteria, as set out in this part, may also apply as a condition for, 
or limitation on, payment.
    (b) In order for a marketing of a slaughter lamb to qualify for 
payment under paragraph (a) of this section, the carcass produced by 
the slaughter must be evaluated and certified by an AMS agent or their 
assigned representative that such carcass meets the following criteria:
    (1) Meet the requirements of USDA Quality Grade Choice or Prime;
    (2) Meet the requirements of USDA Yield Grade 2;
    (3) Have a muscling confirmation score of ``Average Choice'' or 
better; and
    (4) Have a 55-75 pound dressed hot carcass weight;
    (c) Subject to the availability of funds, in order to be eligible 
for the ``Year 2'' and ``Year 3'' feeder lamb payments referred to in 
Sec. 784.1, at the rates specified in Sec. 784.9, sheep operations must 
have in the preceding year of which payment is sought had a gross 
annual revenue of $2.5 million or less, and must for the year in which 
the payment is sought marketed qualifying feeder lambs. In order for a 
feeder lamb to be a qualifying feeder lamb it must have been:
    (1) Owned by the operation, as part of its normal raising of lambs 
for slaughter, continuously for 30 days prior to the time of the 
qualifying marketing; and
    (2) At the time of the marketing must have been, as determined and 
certified by AMS, thick-muscled and large-framed.
    (d) To be eligible for any payments under this section, the sheep 
and lamb operation must be engaged in the business of producing and 
marketing agricultural products at the time of filing the application.
    (e) In addition, to be eligible for ``Year 2'' and ``Year 3'' 
payments, a sheep and lamb operation must submit a timely application 
during the application period for ``Year 2'' and ``Year 3'' benefits 
and comply with all other terms and conditions of this part or are 
contained in the application to be eligible for such benefits.


Sec. 784.9  Year 2 and Year 3 rate of payment.

    Subject to the availability of funds, and the proration rules set 
out in Sec. 784.10, ``Year 2'' and ``Year 3'' payments may be made to 
sheep and lamb operations at the following rates:
    (a) $3 for each qualifying feeder lamb; plus
    (b) $5 for each eligible qualifying slaughter lamb, except those 
slaughter lambs marketed during the period of June 1 through July 31 of 
the applicable program year for which the payment rate will be $8 per 
head.


Sec. 784.10  Availability of funds for Year 1 through Year 3.

    Total payments under this part, unless otherwise determined by the 
FSA, cannot exceed $30 million. In the event that funds should be 
insufficient to complete payments for a program year then the claims 
for that program year shall be prorated by a national factor so as to 
reduce the payments to be made to the amount available. Payments for 
preceding years will not be affected.


Sec. 784.11  Appeals.

    Any sheep and lamb operation which is dissatisfied with a 
determination made pursuant to this part may make a request for 
reconsideration or appeal of such determination in accordance with the 
appeal regulations set forth at parts 11 and 780 of this title.


Sec. 784.12  Misrepresentation and scheme or device.

    (a) A sheep and lamb operation shall be ineligible to receive 
assistance under this program if it is determined by the State 
committee or the county committee to have:
    (1) Adopted any scheme or device which tends to defeat the purpose 
of this program;
    (2) Made any fraudulent representation; or
    (3) Misrepresented any fact affecting a program determination.
    (b) Any funds disbursed pursuant to this part to any person or 
operation engaged in a misrepresentation, scheme, or device, shall be 
refunded with interest together with such other sums as may become due. 
Any sheep and lamb operation or person engaged in acts prohibited by 
this section and any sheep and lamb operation or person receiving 
payment under this part shall be jointly and severally liable with 
other persons or operations involved in such claim for benefits for any 
refund due under this section and for related charges. The remedies 
provided in this part shall be in addition to other civil, criminal, or 
administrative remedies which may apply.


Sec. 784.13  Estates, trusts, and minors.

    (a) Program documents executed by persons legally authorized to 
represent estates or trusts will be accepted only if such person 
furnishes evidence of the authority to execute such documents.
    (b) A minor who is otherwise eligible for assistance under this 
part must, also:
    (1) Establish that the right of majority has been conferred on the 
minor by court proceedings or by statute;
    (2) Show a guardian has been appointed to manage the minor's 
property and the applicable program documents are executed by the 
guardian; or
    (3) Furnish a bond under which the surety guarantees any loss 
incurred for which the minor would be liable had the minor been an 
adult.

[[Page 38415]]

Sec. 784.14  Death, incompetency, or disappearance.

    In the case of death, incompetency, disappearance or dissolution of 
a person that is eligible to receive benefits in accordance with this 
part, such person or persons specified in part 707 of this chapter may 
receive such benefits, as determined appropriate by FSA.


Sec. 784.15  Maintaining records.

    Persons making application for benefits under this program must 
maintain accurate records and accounts that will document that they 
meet all eligibility requirements specified herein. Such records and 
accounts must be retained for 3 years after the date of payment to the 
sheep and lamb operations under this program. Destruction of the 
records after such date shall be the risk of the party undertaking the 
destruction.


Sec. 784.16  Refunds; joint and several liability.

    (a) In the event there is a failure to comply with any term, 
requirement, or condition for payment arising under the application, or 
this part, and if any refund of a payment to FSA shall otherwise become 
due in connection with the application, or this part, all payments made 
under this part to any sheep and lamb operation shall be refunded to 
FSA together with interest as determined in accordance with paragraph 
(c) of this section and late payment charges as provided in part 1403 
of this title.
    (b) All persons signing a sheep and lamb operation's application 
for payment as having an interest in the operation shall be jointly and 
severally liable for any refund, including related charges, which is 
determined to be due for any reason under the terms and conditions of 
the application or this part with respect to such operation.
    (c) Interest shall be applicable to refunds required of any person 
under this part if FSA determines that payments or other assistance was 
provided to a person who was not eligible for such assistance. Such 
interest shall be charged at the rate of interest which the United 
States Treasury charges the Commodity Credit Corporation (CCC) for 
funds, from the date FSA made such benefits available to the date of 
repayment or the date interest increases as determined in accordance 
with applicable regulations. FSA may waive the accrual of interest if 
FSA determines that the cause of the erroneous determination was not 
due to any action of the person.
    (d) Interest determined in accordance with paragraph (c) of this 
section may be waived at the discretion of FSA alone for refunds 
resulting from those violations determined by FSA to have been beyond 
the control of the person committing the violation.
    (e) Late payment interest shall be assessed on all refunds in 
accordance with the provisions of, and subject to the rates prescribed 
in 7 CFR part 792.
    (f) Any excess payments made by FSA with respect to any application 
under this part must be refunded.
    (g) In the event that a benefit under this subpart was provided as 
the result of erroneous information provided by any person, the benefit 
must be repaid with any applicable interest.

    Signed at Washington, DC, on June 16, 2000.
George Arredondo,
Acting Administrator, Farm Service Agency.
[FR Doc. 00-15724 Filed 6-19-00; 11:19 am]
BILLING CODE 3410-05-P