[Federal Register Volume 65, Number 213 (Thursday, November 2, 2000)]
[Rules and Regulations]
[Pages 65718-65728]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-27794]


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DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

Farm Service Agency

7 CFR Parts 718, 1427, 1464, and 1469

RIN 0560-AG19


Farm Reconstitutions and Market Assistance for Cottonseed, 
Tobacco, and Wool and Mohair

AGENCIES: Commodity Credit Corporation, Farm Service Agency, USDA.

ACTION: Final rule.

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SUMMARY: This rule implements provisions of the Agricultural Risk 
Protection Act of 2000 (ARPA) related to the market assistance programs 
for cottonseed, tobacco, and wool and mohair. Other provisions of the 
Act will be implemented under separate rules.

EFFECTIVE DATE: October 27, 2000.

FOR FURTHER INFORMATION CONTACT: Tom Witzig, Chief, Regulatory Review 
and Foreign Investment Disclosure Branch, USDA/FSA/ORAS/RRFIDB/STOP 
0540, 1400 Independence Avenue, SW, Washington, DC, 20250-0540, 
telephone (202)205-5851, or by e-mail to: [email protected].

SUPPLEMENTARY INFORMATION:

Notice and Comment

    Section 263 of the ARPA requires that these regulations be 
promulgated without regard to the notice and comment provisions of 5 
U.S.C. 553 or the Statement of Policy of the Secretary of Agriculture 
effective July 24, 1971, (36 FR 13804) relating to notices of proposed 
rulemaking and public participation in rulemaking. These regulations 
are thus issued as final.

Executive Order 12866

    This final rule has been determined to be economically significant 
under Executive Order 12866 and has been reviewed by the Office of 
Management and Budget (OMB). A cost-benefit assessment was completed 
and is summarized after the background section explaining the actions 
this rule will take.

Regulatory Flexibility Act

    It has been determined that the Regulatory Flexibility Act is not 
applicable to this rule because USDA is not required by 5 U.S.C. 553 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 12372

    The programs administered under the regulations contained in this 
rule are 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 3015, subpart V, published at 48 
FR 29115 (June 24, 1983).

Unfunded Mandates

    The provisions of Title II of the Unfunded Mandates Reform Act of 
1995 are not applicable to this rule because the USDA is not required 
by 5 U.S.C. 553 or any other provision of law to publish a notice of 
proposed rulemaking with respect to the subject matter of this rule.

Small Business Regulatory Enforcement Act of 1996

    Section 263 of the ARPA requires that the regulations necessary to 
implement the Act be issued as soon as practicable after the date of 
enactment and without regard to the notice and comment provision of 5 
U.S.C. 553 or the Statement of Policy of the Secretary of Agriculture 
effective July 24, 1971, (36 FR 13804) relating to the notice of 
proposed rulemaking and public participation in rulemaking. It also 
requires the Secretary to use the provisions of 5 U.S.C. 808 (the Small 
Business Regulatory Enforcement Act (SBREFA)), which provide that a 
rule may 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 purpose, and thus does not have 
to meet the requirements of Sec. 801 of SBREFA requiring a 60-day delay 
for Congressional review of a major regulation before the regulation 
can go into effect. This final rule is considered major for the 
purposes of SBREFA. However, these regulations

[[Page 65719]]

affect a large number of agricultural producers who have been 
significantly impacted by natural disasters and poor market conditions. 
Accordingly, and because Section 263 explicitly sets out Congress' 
intent that the waiting period of SBREFA should not apply, it has been 
determined that it would be contrary to the public interest and the 
relevant public laws to delay implementation of this rule. This rule is 
therefore made effective immediately.

Executive Order 13132

    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.

Paperwork Reduction Act

    Section 263 of the ARPA requires that these regulations be 
promulgated and the programs administered without regard to the 
Paperwork Reduction Act. This means that the information to be 
collected from the public to implement these programs and the burden, 
in time and money, the collection of the information would have on the 
public does not have to be approved by the Office of Management and 
Budget or be subject to the normal requirement for a 60-day public 
comment period.

Background

    This rule will implement the requirements of the Agricultural Risk 
Protection Act of 2000 (Pub. L. 106-224) related to the market 
assistance programs for tobacco, wool and mohair, and cottonseed.

1. 7 CFR Part 718--Farm Reconstitutions For Burley Tobacco

    Section 204 of the ARPA changes the rules for reconstitution of 
farms with burley tobacco quotas to allow, on the division of such a 
farm by sale, the quota to be divided in such manner as the buyer and 
seller agree. Previously, the buyer and seller were not allowed that 
option. Rules contained in 7 CFR Part 718 have been modified 
accordingly.

2. 7 CFR Part 1427--Cottonseed Payment Program

    Section 204(e) of the ARPA directs the Secretary of Agriculture to 
use $100 million of funds of the Commodity Credit Corporation (CCC) to 
provide assistance to producers and first handlers of the 2000 crop of 
cottonseed. A similar program for the 1999 crop of cottonseed, 
authorized under section 104(a) of Pub. L. 106-113, was codified in 
subpart F of 7 CFR 1427 by publication of a final rule on June 8, 2000 
(65 FR 36550). Under the 1999-crop program, payments were provided to 
gins who, almost universally, obtain the cottonseed from producers as 
partial or full payment for their ginning services. Program payments 
compensated gins for seed prices that were so low that their ginning 
costs were not fully covered by the seed market value. As that program 
seems to have been successful in accomplishing its intended goals and 
there is no indication that Congress was dissatisfied with the prior 
program, it has been decided to operate the new program in the same 
manner as the old.
    The major provisions of this program are as follows. The CCC will 
announce a period during which U.S. cotton gins may apply for 
cottonseed payments. To participate, cotton gins must complete an 
application form including: (1) Applicant name, address, and a contact 
person and telephone number; (2) bank account identifying information 
for payees electing to have payments made by direct account deposit; 
(3) the gin's 5-digit identifying code; (4) the number of bales of 
cotton ginned from the 2000 cotton crop; and, (5) the weight (in 
pounds) of cotton lint of the reported bales for which payment is 
requested. CCC must receive the application within the announced 
application period.
    At the close of the application period, based on the number of 
bales and the weight of cotton lint for which payment is requested, CCC 
will estimate the national total quantity of cottonseed for payment. 
The payment rate per ton of cottonseed, and payments to applicants, 
will then be determined. The resulting payments to cotton gins will not 
be subject to any payment limitation.
    Because outlays for this program are a fixed amount, the national 
average payment rate and individual payments can be calculated and 
provided only after the total eligible quantity of cottonseed can be 
determined from approved applications.

3. 7 CFR 1464--Tobacco Loss Assistance Program 2000 (TLAP00)

    Section 204(b) of the ARPA directs the Secretary to use $340 
million of CCC funds to make payments to eligible persons who own or 
operate, or produce tobacco on, a farm for which the quantity of quota 
of eligible tobacco allotted to the farm under Part I of subtitle B of 
Title III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1311 et 
seq.) was reduced from the 1999 crop year to the 2000 crop year and 
that is used for the production of eligible tobacco during the 2000 
crop year. Funds will be paid directly to quota holders, tobacco 
controllers, growers, producers and tenants whose quota was reduced 
from the 1999 crop year to the 2000 crop year.
    The statute allocates funds in a specific amount to16 States. CCC 
shall directly divide the amount allocated to a State among farms in 
the State based on the quota of eligible tobacco available to each farm 
of an eligible person for the 2000 crop year. These allocated funds 
will be paid to the eligible persons who are eligible quota owners, 
quota lessees, controllers, tenants and tobacco producers on farms in 
the State. In the case of a State that is a party to the National 
Tobacco Grower Settlement Trust, the funds, to the extent practicable, 
will be distributed under this part (that is, under TLAP00) to eligible 
persons in the State in accordance with formulas established pursuant 
to the Trust with such adjustments as the Secretary has determined are 
necessary in order to meet the October 1 to October 20, 2000, statutory 
window for disbursing payments to eligible persons. In the case of a 
State that is not a party to the National Tobacco Grower Settlement 
Trust, the funds will be distributed pursuant to a formula established 
by the Secretary.
    The rule specifies that quotas or allotments which are suspended 
from production because of a Conservation Reserve Program (CRP) 
contract with the CCC will not be treated as ``considered produced'' 
for the purposes of this program and will not generate payments under 
this subpart. This is because the program is designed to cover market 
losses for a particular period whereas the suspended quotas and 
allotments, because of the suspension, were not expected by the 
producer to generate income during that period and, consequently, in 
fact produced the same income as if there had been no reduction in the 
overall national marketing quota for the kind of tobacco involved. 
Rather, the income received was the income under the CRP contract which 
was not diminished by the reduction in the tobacco marketing quota. 
Also, the rule specifies that for purposes of this program, an eligible 
person's status, as owner or controller or producer of the tobacco, 
will be determined as of July 3, 2000, unless the Deputy Administrator 
shall determine otherwise. The choice of the date is consistent with 
the State programs that this program is intended to mimic and also 
consistent with the provisions of

[[Page 65720]]

the normal Federal program for tobacco in which July 1 is normally the 
last date for making permanent transfers of quota. At this point, in 
addition, persons with an interest in tobacco quotas have a history of 
payments under the first TLAP program and under the ``Phase II'' 
program operated by the States.
    Due to the October 20, 2000, payment deadline imposed by the 
statue, the use of all individual State trust payment formulas would 
generate a high level of risk in the overall program delivery being 
delayed, with a subsequent delay in the FSA ability to issue payments 
for the program. After careful consideration of the various State 
formulas two formulas were selected and the States will be grouped 
accordingly to the formula that most closely matched the State's 
formula.
    Accordingly, the funds for all flue-cured (types 11, 12, 13 and 14) 
and cigar-binder (types 54 and 55) tobaccos will be paid, 50 percent to 
the quota owner and 50 percent to the producer. The allocated funds for 
all burley (type 31) and dark fire-cured (type 21) tobaccos will be 
paid one-third to quota owners; one-third to the farm controller; and 
one-third to the grower(s)/tenant(s). These payment scenarios most 
nearly reflect the Phase II payment formulas for these kinds of tobacco 
in the principal growing areas. The rules provide a special provision 
for Georgia in that payment in that State will be made only if a 
specified amount is also contributed by the State to the same persons 
who are otherwise eligible for Federal payments under this new program. 
This special provision is required by the authorizing legislation.

4. 7 CFR 1469--Wool and Mohair Market Loss Assistance Program

    Section 204(d) of the ARPA provides that the Secretary shall use 
funds of the Commodity Credit Corporation to make payments to producers 
of wool and mohair for the 1999 marketing year. Producers of wool and 
mohair are experiencing the lowest prices in history. The ARPA requires 
the Secretary of Agriculture to make direct payments to wool and mohair 
producers at payment rates of 20 cents per pound for wool and 40 cents 
per pound for mohair. Producers wanting to participate in the new 
program must file an application for payment by December 29, 2000, or 
such other date as may be set by the Deputy Administrator for Farm 
Programs, FSA. Applications will be spot-checked and validated by FSA. 
Payment will be made only for wool and mohair shorn in the United 
States in 1999 from live domestic animals owned by the producer for 30 
days or more. These restrictions are intended to insure that coverage 
is limited to actual wool producers, as opposed to meat producers, for 
wool actually produced as wool, not a by-product, during the relevant 
time period allowed for by the statute. Other restrictions will also 
apply.

Cost-Benefit Assessment

Summary

    Outlays under the programs implemented by this rule will total 
approximately $450 million. The table summarizes the outlays and a 
summary of the Cost/Benefit Assessment for each program follows.

                           Summary of Outlays
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                           Program                              Outlays
------------------------------------------------------------------------
Cottonseed Payment Program...................................     $100.0
Tobacco Loss Assistance Program..............................      340.0
Wool and Mohair Payment Program..............................       10.0
                                                              ----------
    Total....................................................      450.0
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Cottonseed Payment Program

    The cottonseed support payment program is designed to provide 
payments to cotton ginners in response to an expected continuation of 
low cottonseed prices in the 2000 crop year. The statute authorizes the 
expenditure of $100 million in Commodity Credit Corporation funds for 
payments to first handlers or producers of 2000-crop cottonseed. 
Normally, the value of the seed covers the cost to cotton producers of 
ginning their cotton. In 1999, however, the value of the seed was 
insufficient to pay the full cost of ginning in many locations in the 
Cotton Belt, and growers were asked to pay additional fees. During the 
2000 crop year, prices for cottonseed are projected to be even lower 
than they were in the 1999 season, but ginning costs are likely to be 
the same or higher. Thus, losses again are expected in the ginning 
process.
    Last season, the average price of cottonseed, $90 per ton, was 
about $39 per ton (30 percent) below the average level received in 
1998, or about $27 per ton (23 percent) less than the average of 1994 
through 1998. Though it is very early in the 2000 ginning season, USDA 
expects that cottonseed prices will drop further in 2000 and average 
about $84 per ton.
    Cottonseed prices in 1999 would equate to about $34 worth of seed 
per bale of cotton lint produced, on a national average. The national 
average ginning cost for 1999 is estimated at $46 per bale. Thus, the 
national average value of cottonseed likely fell about $12 short of the 
cost of ginning a bale of cotton. That is the equivalent of about 2.5 
cents per pound of lint.
    For the 2000 crop year, the expected value of cottonseed is only 
about $32 per bale of lint, while ginning costs are again expected to 
average about $46 per bale. The average loss over the entire 19-
million-bale crop now expected to be harvested would be about $14 per 
bale, or almost 2.9 cents per pound.
    For ginning services in 1999, some farmers were initially asked to 
pay the ginner an additional 2 or 3 cents per pound of cotton lint 
beyond the value of the seed. Later in the season, as the 1999 
cottonseed program began to be publicized, some ginners merely held 
these ginning bills, knowing they would receive the program payment. In 
2000, it is likely that ginners will hold bills against the payment 
they are expecting from this year's program.
    Cottonseed prices are influenced heavily by soybean prices. Prices 
for soybeans in 1999 fell from the depressed level of $4.93 they 
averaged in 1998 to $4.65 per bushel. A further stock build-up is 
projected for the 2000 crop year, and prices are projected at $4.35 per 
bushel, even lower than they were in 1999. The prices for other 
oilseeds, including canola, sunflower seed, and cottonseed are all 
projected to be down substantially from last year's level.
    The most viable option to assist cotton producers is a direct 
payment program in which payments are made to ginners. There are 
between 1000 and 1100 gins in the United States. About 25 percent are 
co-operatives. Another 50 percent are owned as corporations by farmers 
who gin their own and their neighbors' cotton. About 25 percent are 
independent gins.
    Thus, farmers have a direct interest in about 75 percent of the 
gins and can be expected to receive nearly the full benefit of any 
payments made to the gins. In the other 25 percent of gins where 
farmers do not directly operate or share in the ownership, farmers 
still may be expected to receive a substantial portion of the program 
benefits because: (1) The gins may have held the ginning bills pending 
the implementation of this program; (2) gins may rebate farmers any 
ginning bill already paid by farmers; or (3) competition among gins may 
dictate that any payments beyond those needed to cover the shortfall in 
seed prices will be rebated to the gins' customers.
    In 1999, total cottonseed production was estimated at 6,422,400 
tons. Total losses associated with ginning in 1999

[[Page 65721]]

are estimated at $190 million. Total funding available for the 1999 
program was $79 million, and payments were $12.23 per ton of seed 
produced, or about $4.77 per bale of lint pressed. Payments were made 
to 1015 gins and covered about 41 percent of the losses.
    For 2000, given the current projection of cotton lint production of 
19,159,000 bales, cottonseed production should total about 7.38 million 
tons. At $84 per ton, the seed would be valued at $622 million. Ginning 
costs are expected to average a little over $46 per bale, so the cost 
of ginning the 2000 crop should be about $885 million. The projected 
loss on ginning costs would be $263 million, or about $13.75 per bale 
of lint pressed. The payments will cover about 38 percent of the loss.

Tobacco Loss Assistance Program

    On September 20, 1998, the major cigarette manufacturers agreed to 
pay $246 billion to the various states to settle their medicare 
lawsuits. To defray these costs, the manufacturers raised cigarette 
prices substantially. The increased cost of cigarettes, along with 
adverse publicity surrounding smoking has curtailed cigarette use--and 
therefore leaf use--substantially.
    As a result, marketing quota for flue-cured and burley tobaccos 
continue to decline. The 2000 crop quotas were reduced 18.4 percent and 
45.3 percent respectfully. In addition, producers of Virginia fire-
cured (type 21) tobacco and cigar filler and binder (types 42-44; 53-
55) tobacco suffered declines of 15 percent and 17\1/2\ percent 
respectively, in 2000 allotments, for reason's unrelated to the 
settlement.
    Most tobacco operations are small family-owned farms. There are 
few, if any, alternatives for tobacco. With no crop alternatives and 
little diversification in tobacco growing regions, economic hardship is 
particularly harsh during downturns in tobacco production. Thus, the 
tobacco loss assistance provisions of the ARPA appropriated $340 
million to lessen economic hardships in specific tobacco communities.
    The $340 million will assist quota holders and growers to defray 
income lost in crop year 2000 due to quota reductions. The program will 
pay producers roughly $1 for each pound of quota lost in crop year 
2000. This amount of payment will more than cover producers' and quota 
holders' lost profit for crop year 2000.

Wool and Mohair Payment Program

    Both wool and mohair production in the United States have been on 
the decline in recent years. The number of head of sheep estimated to 
have been shorn for wool production has declined every marketing year 
since 1981. The number of goats clipped for mohair production has 
declined annually for about the last 10 years. Wool production has been 
cut in half since 1988 and is estimated for 1999 at 46.5 million 
pounds. Mohair production in 1999 is estimated at only 3.2 million 
pounds, only one-fifth of the production in 1991.
    Wool prices in 1995 averaged over $1 per pound, but by the end of 
the 1999 marketing year they were averaging about 60 cents. Average 
prices for mohair were about $2.50 per pound for 2 years and then 
increased to $3.50 per pound in 1999. Because of reduced production, as 
well as low prices, the value of wool produced in 1999 is estimated at 
about $17.9 million, a decline of 85 percent from the value 10 years 
ago and down 40 percent from the value in 1998. The value of mohair 
produced in 1999 is estimated at $10 million, about half of the value 
10 years ago and down 20 percent from the already depressed value in 
1998.
    Wool consumption by domestic textile mills also has declined 
steadily in recent years and is projected for 1999 at only 85 million 
pounds, the lowest in at least 25 years and down 30 million pounds from 
1998's level.
    A recourse loan program was implemented for mohair in the 1998 and 
1999 marketing years, but only about 40 percent of the 5.5 million 
pounds of hair placed under loan in 1998 and about 10 percent of the 
1.2 million pounds placed under loan in 1999 has been redeemed.
    Given these discouraging production, price, and consumption 
figures, Congress has provided direct Market Loss Assistance (MLA) 
payments for producers of mohair and wool in 1999.
    Two options were considered for determining the quantity of a 
producer's wool or mohair eligible for payment. The first option 
limited the eligible quantity to marketings of wool or mohair during 
marketing year 1999. The second option allowed producers to certify the 
quantity they produced during marketing year 1999 and subject them to 
spot checks by CCC.
    The second option was selected for two reasons. First, the program 
administration would be much simpler if paper documentation of 
marketings were not required. Spot checks can be accomplished by local 
FSA personnel. Penalties for inaccurate certifications by producers can 
be easily assessed and will inhibit false reports.
    Second, many producers have not yet marketed their wool or mohair 
because of the very low prices this program was designed to address. To 
deny those producers payments on the grounds they had no 1999 
marketings would be contrary to the objective of the program.
    Payments of 20 cents per pound on 1999 wool production would amount 
to about $9 million, more than doubling proceeds from wool production. 
However, payments will not actually be made to producers until almost 
the end of the 2000 marketing year, so it is difficult to envision 
significant near-term impacts on the U.S. wool situation. Some 
additional production may be stimulated in early 2001 for producers who 
otherwise lack financing. However, continued heavy textile imports 
likely will mean stagnant mill demand for wool. MLA payments may 
contribute to continued depressed prices in the future to the extent 
that they stimulate additional production.
    Mohair producers are to receive 40 cents per pound. MLA payments 
will amount to about $1 million, or 10 percent of sales receipts in 
1999. The income impact of this program on mohair producers is not as 
significant as it is on wool producers, and its impact on the supply/
use situation for mohair should be even less than its impact on the 
wool situation.

List of Subjects

Part 718

    Acreage allotments, Loan program--agriculture, Marketing quotas, 
Price support programs, Reporting and recordkeeping requirements.

Part 1427

    Cotton, Cottonseed, Loan programs--agriculture, Price support 
programs, Reporting and recordkeeping requirements.

Part 1464

    Imports, Loan programs--agriculture, Price support programs, 
Reporting and recordkeeping requirements, Tobacco.

Part 1469

    Loan programs--agriculture, Mohair, Price support programs, 
Reporting and recordkeeping requirements.

    For the reasons set out in the preamble, 7 CFR Chapters VII and XIV 
are amended as set forth below.

PART 718--PROVISIONS APPLICABLE TO MULTIPLE PROGRAMS

    1. The authority citation for 7 CFR part 718 continues to read as 
follows:

    Authority: 7 U.S.C. 1373, 1374, 7201, et seq.; 15 U.S.C. 714b 
and 714c; and 21 U.S.C. 889.


    2. Amend Sec. 718.205 by removing paragraphs (c)(5)(i) and 
(c)(5)(ii) and

[[Page 65722]]

revising paragraph (c)(5) to read as follows:


Sec. 718.205  Rules for determining farms, allotments, quotas, and 
acreages when reconstitution is made by division.

* * * * *
    (c) * * *
    (5) The designation by landowner method is not applicable to crop 
allotments or quotas which are restricted to transfer within the county 
by lease, sale, or by owner, when the land on which the farm is located 
is in two or more counties.
* * * * *

PART 1427--COTTON

    3. The authority citation for 7 CFR part 1427 is revised to read as 
follows:

    Authority: 7 U.S.C. 7231-7235-7237; 15 U.S.C. 714b and 714c; 
Sec. 813, Pub. L. 106-78; Sec.204(e), Pub. L. 106-224.


    4. Revise subpart F of part 1427 to read as follows:

Subpart F--Cottonseed Payment Program

Sec.
1427.1100   Applicability.
1427.1101   Administration.
1427.1102   Definitions.
1427.1103   Eligible cottonseed.
1427.1104   Eligible first handlers.
1427.1105   Payment application.
1427.1106   Total available program funds.
1427.1107   Applicant payment quantity.
1427.1108   Total payment quantity.
1427.1109   Payment rate
1427.1110   Payment calculation and form.
1427.1111   Liability of first handler.


Sec. 1427.1100  Applicability.

    (a) The regulations in this subpart are applicable to the 2000 crop 
of cottonseed. These regulations set forth the terms and conditions 
under which the Commodity Credit Corporation (CCC) shall provide 
payments to first handlers of cottonseed who have applied to 
participate in the Cottonseed Payment Program in accordance with 
Section 204(e) of Public Law 106-224. Additional terms and conditions 
may be set forth in the payment application that must be executed by 
participants to receive cottonseed payments.
    (b) Payments shall be available only for cottonseed produced and 
ginned in the United States.


Sec. 1427.1101  Administration.

    (a) The Cottonseed Payment Program shall be administered under the 
general supervision of the Executive Vice President, CCC 
(Administrator, FSA), or a designee, and shall be carried out by FSA's 
Price Support Division (PSD) and Kansas City Management Office (KCMO).
    (b) The PSD and KCMO and representatives and employees thereof, do 
not have the authority to modify or waive any of the provisions of the 
regulations of this subpart.
    (c) No provision or delegation of this subpart to PSD or KCMO shall 
preclude the Executive Vice President, CCC, or a designee, from 
determining any question arising under the program or from reversing or 
modifying any determination made by PSD or KCMO .
    (d) The Executive Vice President, CCC, or a designee, may waive or 
modify deadlines and other program requirements in cases where lateness 
or failure to meet such other requirements do not affect adversely the 
operation of the cottonseed payment program.
    (e) A representative of CCC may execute cottonseed payment program 
applications and related documents only under the terms and conditions 
determined and announced by CCC.
    (f) Payment applications and related documents not executed in 
accordance with the terms and conditions determined and announced by 
CCC, including any purported execution outside of the dates authorized 
by CCC, shall be null and void unless the Executive Vice President, 
CCC, shall otherwise allow.


Sec. 1427.1102  Definitions.

    The definitions set forth in this section shall be applicable for 
purposes of administering the 2000 Cottonseed Payment Program. The 
terms defined in Secs. 1427.3, 1427.52, and 1427.102 shall also be 
applicable to this subpart.
    Application period means a period, to be announced by CCC, during 
which applications for payments under the Cottonseed Payment Program 
must be received to be considered for payment.
    Cottonseed means the seed from any variety of upland cotton and 
extra long staple (ELS) cotton produced and ginned in the United 
States.
    Gin means a person (i.e., an individual, partnership, association, 
corporation, cooperative marketing association, estate, trust, State or 
political subdivision or agency thereof, or other legal entity) that 
removes cotton seed from cotton lint.
    Lint means cotton lint as contained in bales of cotton ordinarily 
marketed as cotton and excludes any linters, raw motes, re-ginned 
motes, cleaned motes, and any other gin waste or by product not 
traditionally defined as cotton lint.
    Number of bales means the number of running bales of cotton based 
on individual bale weights unadjusted to a uniform bale weight.
    Olympic average means the average for the stated period after 
excluding the highest and lowest values.
    Running bale means a bale of cotton lint that has a minimum weight 
of 425 pounds.
    Ton means a unit of weight equal to 2000 pounds avoirdupois (907.18 
kilograms).


Sec. 1427.1103  Eligible cottonseed.

    To be eligible for payments under this subpart, cottonseed must:
    (a) Have been grown in the United States during the 2000-crop 
production period.
    (b) Have been ginned by the applicant from 2000-crop cotton.
    (c) Not have been destroyed or damaged by fire, flood, or other 
events such that its loss or damage was compensated by other local, 
State, or Federal Government or private or public insurance or disaster 
relief payments.


Sec. 1427.1104  Eligible first handlers.

    (a) For the purpose of this subpart, an eligible first handler of 
cottonseed shall be a gin that ginned 2000-crop cotton.
    (b) Applicants must comply with the terms and conditions set forth 
in this subpart and instructions issued by CCC, and sign and submit an 
accurate, legible and complete Cottonseed Payment Program Application/
Certification.
    (c) Applicants, in signing the Cottonseed Payment Program 
Application/Certification, must agree to share any payment received 
with the producer of the cotton that was the basis of the payment to 
the extent that the revenue from cottonseed sale is shared with the 
producer.


Sec. 1427.1105  Payment application.

    (a) Payments in accordance with this subpart shall be made 
available to eligible first handlers of cottonseed based on information 
provided on a Cottonseed Payment Program Application/Certification.
    (b) Payment applications must be received within the program 
application period announced by CCC. Applications received after such 
application period may not be accepted for payment.
    (c) Cottonseed Payment Program Applications/Certifications may be 
obtained from the CCC as announced by press release. In order to 
participate in the program authorized by this subpart, first handlers 
of cottonseed must execute the Cottonseed Payment Program Application/
Certification and forward the completed original to CCC as announced 
and directed on the application.

[[Page 65723]]

Sec. 1427.1106  Total available program funds.

    The total available program funds shall be $100 million as provided 
by Section 204(e) of Public Law 106-224.


Sec. 1427.1107  Applicant payment quantity.

    (a) The applicant's payment quantity of cottonseed will be 
determined by CCC based on the number of eligible ginned cotton bales 
and cotton lint weight submitted on the Cottonseed Payment Application/
Certification and/or obtained by CCC, with the agreement of the 
applicant, from the Agricultural Marketing Service.
    (b) The applicant's payment quantity of cottonseed shall be 
calculated by multiplying:
    (1) The applicant's weight of lint for which payment is requested, 
as approved by CCC, by
    (2) The 1995-99 Olympic average of estimated pounds of cottonseed 
per pound of ginned cotton lint for all domestic ginners.


Sec. 1427.1108  Total payment quantity.

    (a) The total quantity of 2000-crop cottonseed produced in the 
United States is eligible for payment under this subpart. The total 
payment quantity of cottonseed will be the total of eligible cottonseed 
for which applications for payment are received within the application 
period announced by CCC.
    (b) The total payment quantity of cottonseed (ton-basis) shall be 
calculated by multiplying:
    (1) The weight of cotton lint (ton-basis) for which payment is 
requested by all applicants, as approved by CCC, by
    (2) The 1995-99 Olympic average of estimated pounds of cottonseed 
per pound of ginned cotton lint .


Sec. 1427.1109  Payment rate.

    The payment rate (dollars per ton) for the purpose of calculating 
payments made available in accordance with this subpart shall be 
determined by CCC by dividing the total available program funds by the 
total payment quantity of 2000-crop cottonseed.


Sec. 1427.1110  Payment calculation and form.

    (a) Payments in accordance with this subpart shall be determined 
for individual applicants by multiplying:
    (1) The payment rate, determined in accordance with Sec. 1427.1109, 
by
    (2) The payment quantity of the applicant, determined in accordance 
with Sec. 1427.1107.
    (b) After receipt of the application for payment, together with 
required supporting documents and the determination of the payment 
rate, CCC will issue payments to the applicant by electronic deposit to 
the applicant's account. Applicants may request that payment be made by 
mailed check. If a payment is not made within 30 days of the close of 
the announced application period, CCC will pay interest at the prompt 
payment interest rate.


Sec. 1427.1111  Liability of first handler.

    (a) If a first handler makes any fraudulent representation in 
obtaining a cottonseed payment, such payment shall be refunded upon 
demand by CCC. The first handler shall be liable for the amount of the 
payment and applicable interest on such payment, as determined by CCC.
    (b) If more than one person executes a payment application with 
CCC, each such person shall be jointly and severally liable for any 
violation of the terms and conditions of the application and the 
regulations set forth in this subpart. Each such person shall also 
remain liable for the repayment of the entire payment amount until the 
payment is fully repaid without regard to such person's claimed share 
in the cottonseed payment.
    (c) If the payment recipient is suspected by CCC to have knowingly:
    (1) Adopted any scheme or device which violates this Application;
    (2) Made any fraudulent representation; or
    (3) Misrepresented any fact affecting a determination under this 
Application, CCC will notify the appropriate investigating agencies of 
the United States and take steps deemed necessary to protect the 
interests of the government.
    (d) If the payment applicant receives a payment in excess of the 
entitled payment in accordance with the application, the applicant 
shall refund to CCC an amount equal to the excess payment, plus 
interest thereon, as determined by CCC.
    (e) From the date of the payment application until the earlier of 3 
years after the date of the application or July 31, 2004, the applicant 
shall keep records and furnish such information and reports relating to 
the application as may be requested by CCC. Such records shall be 
available at all reasonable times for an audit or inspection by 
authorized representatives of CCC, United States Department of 
Agriculture, or the Comptroller General of the United States. Failure 
to keep, or make available, such records may result in refund to CCC of 
all payments received, plus interest thereon, as determined by CCC. 
Nothing in this section shall, however, authorize the destruction of 
any records where there is an on-going dispute or where the party 
involved has reason to know that such records remain material to the 
operation of the program.
    (f) No Member or Delegate of Congress or Resident Commissioner 
shall be admitted to any share or part of payments provided under this 
Application or to any benefit to arise therefrom, except that this 
provision shall not be construed to extend to their interest in any 
incorporated company, if this Application is for the general benefit of 
such company, nor shall it be construed to extend to any benefit that 
may accrue to such official in their capacity as a producer.

PART 1464--TOBACCO

    5. The authority citation for part 1464 is revised to read as 
follows:

    Authority: 7 U.S.C. 1421, 1423, 1441, 1445, 1445-1; 1445-2; 15 
U.S.C. 714b, 714c; Pub. L. 106-78, 113 and 224; Sec. 204(b), Pub. L. 
106-224.


    6. Revise the heading for subpart C to read as follows:

Subpart C--Tobacco Loss Assistance Program 1999

    7. Add subpart E to read as follows:

Subpart E--Tobacco Loss Assistance Program 2000

Sec.
1464.401  Applicability and basic terms for payments.
1464.402  Administration.
1464.403  Eligibility.
1464.404  Definitions.
1464.405  Sign up.
1464.406  [Reserved]
1464.407  Payment benefits.
1464.408  Offsets and assignments.
1464.409  Misrepresentation and scheme or device.
1464.410  Refunds to CCC.
1464.411  Cumulative liability.
1464.412  Estate, trusts, and minors.
1464.413  Death, incompetence, or disappearance.
1464.414  Appeals.


Sec. 1464.401  Applicability and basic terms for payments.

    (a) This subpart sets forth the terms and conditions of the Tobacco 
Loss Assistance Program 2000 (TLAP00) authorized by section 204(b) of 
the Agricultural Risk Protection Act of 2000 (Public Law 106-224). That 
section provides that $340 million of funds of the Commodity Credit 
Corporation (CCC) shall be made available to make direct payments to 
eligible persons, on a farm:
    (1) For which the quantity of quota of eligible tobacco allotted to 
the farm was reduced from the 1999 crop year to the 2000 crop year; and

[[Page 65724]]

    (2) That is used for the production of eligible tobacco during the 
2000 crop year.
    (b) The amounts made available to farms in a State shall be divided 
based on the quota of eligible tobacco available to each farm of an 
eligible person for the 2000 crop year.
    (c) The amounts made available to farms in a State under paragraph 
(b) of this section shall be divided among eligible persons who are 
quota owners, quota lessees, controllers, growers, tenants and 
producers on farms in the State but only to the extent that is 
otherwise provided for in this subpart.
    (d) The funds made available for ``eligible persons'' shall be 
allocated among States in the following dollar amounts:

------------------------------------------------------------------------
 
------------------------------------------------------------------------
Alabama.................................................        $100,000
Arkansas................................................           1,000
Florida.................................................       2,500,000
Georgia.................................................      13,000,000
Indiana.................................................       5,400,000
Kansas..................................................          23,000
Kentucky................................................     140,000,000
Missouri................................................       2,000,000
North Carolina..........................................     100,000,000
Ohio....................................................       6,000,000
Oklahoma................................................           1,000
South Carolina..........................................      15,000,000
Tennessee...............................................      35,000,000
Virginia................................................      19,000,000
West Virginia...........................................       1,300,000
Wisconsin...............................................         675,000
------------------------------------------------------------------------

Sec. 1464.402  Administration.

    (a) This subpart shall be administered by CCC under the general 
supervision of the Executive Vice President of the CCC and the Deputy 
Administrator for Farm Programs of the Farm Service Agency (FSA) of the 
Department of Agriculture (who shall be hereafter referred to in this 
part as the ``Deputy Administrator''). The program shall be carried out 
in the field by State and county FSA 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 
that 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 that is not in accordance with this 
part; or
    (2) Require a county committee to withhold taking any action that 
is not in accordance with this part.
    (d) No delegations in this part to a State or county committee 
shall preclude the Executive Vice President, CCC, 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. The 
Deputy Administrator may modify or revise deadlines and requirements 
contained in this subpart as determined needed or appropriate to 
accomplish the goals of this program.


Sec. 1464.403  Eligibility.

    For a person to be considered an ``eligible person'' for purposes 
of this part, such person must own, operate or produce eligible tobacco 
on a farm for which a quota reduction from the 1999 crop year to the 
2000 crop year occurred and that was used for the production of tobacco 
during the 2000 crop year.


Sec. 1464.404  Definitions.

    The definitions set forth in this section shall be applicable for 
all purposes of administering the program (``TLAP00'') of this subpart. 
The definitions in 7 CFR 718.2 and 723.104 also apply to the program. 
To the extent that the definitions in this section differ from the 
definitions in 7 CFR 718.2 and 723.104, the definitions in this section 
apply rather than the definitions in 7 CFR 718.2 and 723.104. The 
following terms shall have the following meanings:
    Controller means that person or entity who, as determined by the 
Deputy Administrator, controls the land used to produce eligible 
tobacco and share in the risk of production.
    Eligible person means, with respect to payments under this part, a 
person who owns or operates, or produces eligible tobacco on a farm for 
which the quantity of quota of eligible tobacco allotted to the farm 
under part I of subtitle B of title III of the Agricultural Adjustment 
Act of 1938 was reduced from the 1999 crop year to the 2000 crop year 
and that will be used for the production of eligible tobacco during the 
2000 crop year. For these purposes, the quota will be considered 
produced if it ``considered produced'' under the normal rules that 
apply with respect to tobacco under this part and under 7 CFR part 723; 
however any such actual production, production that is considered under 
this part and under 7 CFR part 723 to have occurred, will suffice to 
qualify the parties associated with that quota for payments under this 
part to which they would otherwise be entitled. That is, the amount of 
payment will not be tied to the amount of production which qualifies 
the party for participation under this program except as might 
otherwise be specified in this subpart. However, tobacco quotas or 
allotments which are suspended from production because of a 
Conservation Reserve Contract with the CCC will not be treated as 
``considered produced'' for these purposes and will not generate 
payments under this subpart. For purposes of this subpart, further, an 
eligible persons's status, as owner or controller or producer of the 
tobacco, will be determined as of July 3, 2000.
    Eligible tobacco means each of the following kinds of tobacco: 
flue-cured tobacco (types 11, 12, 13 and 14), dark fire-cured tobacco 
(type 21), burley tobacco (type 31), and cigar-binder tobacco (types 54 
and 55).
    Grower/tenant means person(s) or entities who provide labor to 
produce tobacco and share in the risk of production.
    Payment pounds means the pounds of tobacco for which a person is 
eligible to be paid under this subpart.
    Producer means person(s) or entity(s) actively engaged in planting, 
growing, harvesting, and/or marketing of tobacco, or who shares in the 
risk of producing the crop.
    Quota owner means the person(s) or entities who own the land for 
which quota is established under the Agricultural Adjustment Act of 
1938, as amended.
    Share in the risk of production means having a direct financial 
stake in the success of the crop through a direct share in the actual 
proceeds from the actual marketing of the crop which share is 
conditional upon the success of that marketing. Farm owners who cash-
lease their farm land to a tobacco producer for the right to grow 
tobacco on that land and receive payment for such right regardless of 
whether or not a tobacco crop is marketed are not considered to share 
in the risk of production. Farm laborers who provide service in 
exchange for a wage and whose payment is not subject to the marketing 
of the tobacco crop are not considered to be sharing in the risk of 
production.
    TLAP00 means the Tobacco Loss Adjustment Program, for the 2000 
crop, which is provided for in this subpart.


Sec. 1464.405  Sign up.

    (a) Eligible persons who wish to apply for TLAP00 funds, must file 
an application with the county FSA office by the date established by 
the Deputy Administrator. However, a late filed application filed late 
because of hardship may be accepted. Acceptance of such applications 
must be approved by the Deputy Administrator, subject to the 
availability of funds.
    (b) Data furnished by the applicants will be used to determine 
eligibility for program benefits. Furnishing the data is

[[Page 65725]]

voluntary; however, without it program benefits will not be provided.


Sec. 1464.406  [Reserved]


Sec. 1464.407  Payment benefits.

    (a) TLAP00 payments shall be made to ``eligible persons'' not later 
than October 20, 2000 on the basis of two formulas.
    (1) All flue-cured and cigar-binder funds in a State will 
distribute 50 percent to eligible quota owners and 50 percent to 
eligible producers.
    (2) All burley and dark fire-cured tobacco funds in a State will be 
distributed one-third to quota owners; one-third to the controller; and 
one-third to grower(s)/tenant(s).
    (b) As provided in paragraph (a) of this section the formulas shall 
be applied to the kinds of tobacco as follows:
    (1) The allocated funds for cigar-binder (types 54 and 55) will be 
disbursed with 50 percent being paid to quota owners based on basic 
allotment times NASS yield and 50 percent being paid to producers based 
on basic allotment times the NASS yield. The NASS yield for cigar-
binder (types 54 and 55) is 2,054 pounds per acre.
    (2) The allocated funds for dark fire-cured (type 21) will be 
disbursed with one-third being paid to quota owners based on the 2000 
crop year basic allotment times NASS yield, one-third being paid to the 
controller based on the 2000 crop year effective allotment times NASS 
yield, and one-third being paid to grower(s)/tenant(s) based on the 
2000 crop year effective quota times NASS yield. The NASS yield for 
dark fire-cured (type 21) is 2,139 pounds per acre.
    (3) The allotted funds for flue-cured tobacco (types 11, 12, 13 and 
14) will be disbursed with 50 percent paid to quota owners on the 2000 
crop year basic quota and 50 percent being paid to producers on the 
2000 crop year basic quota.
    (4) The allotted funds for burley tobacco (type 31) will be 
disbursed with one-third being paid to quota owners based on the 2000 
crop year basic quota; one-third being paid to the farm controller 
based on the 2000 crop year effective quota before any disaster lease 
and transfer pounds; and one-third being paid to grower(s)/tenant(s) 
based on the 2000 crop year effective quota before any disaster lease 
and transfer pounds.
    (c) The Secretary shall use the amount allocated to the State of 
Georgia to make payments to eligible persons in the State of Georgia 
only if the State of Georgia agrees to use an equal amount (not to 
exceed $13,000,000) to make payments at the same time, or subsequently, 
to the same eligible persons in the same manner as provided for in this 
section.
    (d) The payment amount shall be determined by apportioning the 
allocated funds for each State on a poundage basis among the timely 
applications that are filed, with an allowance for a reserve to handle 
hardships and appeals.
    (e) All payments under this part are subject to the eligibility of 
funds; further, terms used in this part may be further refined and 
applied as will more closely align the payments made under this subpart 
with payments made under the various State programs which have preceded 
it. In the case where a payment to a farm is disputed the Deputy 
Administrator may require that all interested parties agree to the 
resolution of the dispute before any payment is made and may delay 
payments to the farm until any such disputes are resolved. Also, as 
determined appropriate to accomplish the desire that program payments 
be made expeditiously in a manner that is administratively efficient, 
the Deputy Administrator may properly exclude payments to a person who 
does not file a timely claim and all payments may be made to those 
parties whose claim to the payment is not challenged. Nothing in this 
section shall, however, be construed to prevent the agency from denying 
any payment to any person based upon a failure of that person to meet 
any eligibility criteria set forth in this part.


Sec. 1464.408  Offsets and assignments.

    (a) Except as provided in paragraph (b) of this section, any 
payment or portion thereof to any person shall be made without regard 
to questions of title under State law and without regard to any claim 
or lien against the crop, or proceeds thereof, in favor of the owner or 
any other creditor, except that the regulations governing offsets and 
withholdings found at 7 CFR part 1403 shall be applicable to payments 
made under this part and such offsets and withholdings may be taken 
against such payments.
    (b) Any producer entitled to any payment may assign the right to 
receive such payments, in whole or in part, as provided in 7 CFR part 
1404.


Sec. 1464.409  Misrepresentation and scheme or device.

    (a) A producer who is determined to have erroneously represented 
any fact affecting a program determination made in accordance with this 
part shall not be entitled to payments and must refund all payments, 
plus interest determined in accordance with 7 CFR part 1403.
    (b) A producer who is determined to have knowingly:
    (1) Adopted any scheme or device that tends to defeat the purpose 
of the program;
    (2) Made any fraudulent representation; or
    (3) Misrepresented any fact affecting a program determination shall 
refund to CCC all payments, plus interest determined in accordance with 
7 CFR part 1403, received by such producer with respect to all 
applications. The producer's interest in all applications shall be 
terminated.


Sec. 1464.410  Refunds to CCC.

    Persons who are party to the TLAP00 application must refund to CCC 
any excess payments made by CCC with respect to such application with 
interest.


Sec. 1464.411  Cumulative liability.

    The liability of any person for any penalty under this part or for 
any refund to CCC or related charge arising in connection therewith 
shall be in addition to any other liability of such person under any 
civil or criminal fraud statute or any other provision of law 
including, but not limited to, 18 U.S.C. 286, 287, 371, 641, 1001; 15 
U.S.C. 714m; and 31 U.S.C. 3729.


Sec. 1464.412  Estates, trusts, and minors.

    (a) Program documents executed by persons legally authorized to 
represent estates or trusts will be accepted only if such persons 
furnish evidence of the authority to execute such documents.
    (b) A minor who is a producer shall be eligible for assistance 
under this subpart only if such person meets one of the following 
requirements:
    (1) The right of majority has been conferred on the minor by court 
proceedings or by statute;
    (2) A guardian has been appointed to manage the minor's property 
and has executed the applicable program documents; or
    (3) A bond is furnished under which the surety guarantees any loss 
incurred for which the minor would be liable had the minor been an 
adult.


Sec. 1464.413  Death, incompetence, or disappearance.

    In the case of death, incompetence, or disappearance of any person 
who is eligible to receive assistance in accordance with this part, 
such person or persons as are specified in 7 CFR part 707 may receive 
such assistance.

[[Page 65726]]

Sec. 1464.414  Appeals.

    Appeals of determinations made under this part shall be heard under 
the provisions appearing in 7 CFR parts 11 and 780. Provisions of 
general applicability are not appealable and likewise matters committed 
to agency discretion may not be appealable. Nothing in this section 
shall be taken to expand the scope of review of any determination or 
make a determination appealable that would otherwise not be appealable.

PART 1469--RECOURSE LOAN REGULATIONS FOR MOHAIR

    8. The authority citation for part 1469 is revised to read as 
follows:

    Authority: Pub. L. 105-277, 112 Stat. 2681; Sec. 801, Pub. L. 
106-78, 113 Stat. 1135; Sec. 204(d), Pub. L. 106-224.


    9. Revise the heading for part 1469 to read as follows:

PART 1469--WOOL AND MOHAIR PRICE SUPPORT PROGRAMS

    10. Redesignate Secs. 1469.1 through 1469.17 as subpart A and add a 
heading for subpart A to read as follows:

Subpart A--Recourse Loan Regulations for Mohair

    11. Add subpart B to read as follows:

Subpart B--Wool and Mohair Market Loss Assistance Program

Sec.
1469.101  Applicability.
1469.102  Administration.
1469.103  Definitions.
1469.104  Time and method of application.
1469.105  Eligibility.
1469.106  Payment rate and amount.
1469.107  Offsets.
1469.108  Appeals.
1469.109  Misrepresentation.
1469.110  Maintaining records.
1469.111  Estate, trust, and minors.
1469.112  Death, incompetency, or disappearance.
1469.113  Refunds; joint and several liability.


Sec. 1469.101  Applicability.

    The regulations of this subpart provide the terms and conditions 
under which the Commodity Credit Corporation (CCC) may make payments to 
wool and mohair producers for production from the 1999 marketing year.


Sec. 1469.102  Administration.

    (a) The Wool and Mohair Market Loss Assistance Program shall be 
administered under the general supervision of the Executive Vice 
President, CCC, or designee and shall be carried out in the field by 
State and county Farm Service Agency committees (State and county 
committees) and FSA employees.
    (b) State and county committees, and FSA employees, do not have the 
authority to modify or waive any of the provisions of the regulations 
of this subpart.
    (c) The State committee shall take any action required by the 
regulations of this subpart that has not been taken by the county 
committee. The State committee shall also:
    (1) Correct, or require the county committee to correct, any action 
taken by such county committee that is not in accordance with the 
regulations of this subpart; and
    (2) Require a county committee to withhold taking any action that 
is not in accordance with the regulations of this subpart.
    (d) No provision or delegation of this subpart to a State or county 
committee shall preclude the Executive Vice President, CCC, or a 
designee, or the Administrator, FSA, or a designee, from determining 
any question arising under the program or from reversing or modifying 
any determination made by the State or county committee.
    (e) The Deputy Administrator, Farm Programs, FSA, may authorize 
State and county committees to waive or modify deadlines and other 
program requirements in cases where lateness or failure to meet such 
other requirements does not adversely affect the operation of the Wool 
and Mohair Market Loss Assistance Program and does not violate 
statutory limitations on the program.


Sec. 1469.103  Definitions.

    The definitions set forth in this section shall be applicable for 
all purposes of administering the Wool and Mohair Market Loss 
Assistance Program established by this subpart.
    Administrator means the FSA Administrator.
    Application means Form CCC-1155, the Wool and Mohair Market Loss 
Assistance Program Application.
    Application period means October 10, 2000, through December 29, 
2000.
    CCC means the Commodity Credit Corporation.
    County committee means the FSA county committee.
    County office is the local FSA office.
    Farm Service Agency or FSA means the Farm Service Agency of the 
United States Department of Agriculture.
    Goat means an adult Angora goat or the kid of an Angora goat.
    Grease mohair means mohair as it comes from the Angora goat or the 
kid of an Angora goat before applying any process to remove the natural 
oils or fats.
    Grease wool means wool as it comes from the sheep or lambs before 
applying any process to remove the natural oils or fats.
    Hide means thick tough skin of the animal.
    Lamb means a young ovine animal that has not cut the second pair of 
permanent teeth. The term includes animals referred to in the livestock 
trade as lambs, yearlings, or yearling lambs.
    Marketing year means a period beginning January 1, and ending the 
following December 31, both dates inclusive.
    Mohair means the hair sheared from a live Angora goat before 
applying any process that removes the natural oils or fats or produces 
a mohair product. Mohair does not include grease mohair shorn from 
pelts or hides.
    Pelt means the skin of the animal with wool still attached to the 
skin.
    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.
    Producer means any person or group of persons who as a single unit 
produce wool or mohair and whose production and facilities are located 
in the United States.
    Pulled mohair means mohair obtained from the pelts or hides of dead 
goat.
    Pulled wool means wool obtained from the pelts or hides of dead 
sheep.
    Shorn mohair means grease mohair sheared from a live Angora goat or 
the kid of an Angora goat. Shorn mohair does not include pelts, hides, 
or pulled mohair.
    Shorn wool means grease wool sheared from live sheep or lambs. 
Shorn wool does not include pelts, hides, or pulled wool.
    State committee is the FSA committee so designated for the 
applicable State.
    United States means the 50 United States of America, the District 
of Columbia, and the Commonwealth of Puerto Rico.
    Wool means the hair sheared from a live sheep before applying any 
process that removes the natural oils or fats or produces a wool 
product. Wool does not include grease wool shorn from pelts or hides.


Sec. 1469.104  Time and method of application.

    (a) Wool and mohair producers may obtain an application, Form CCC-
1155 (Wool and Mohair Market Loss Assistance Program Application), in

[[Page 65727]]

person, by mail, by telephone, or by facsimile from any county FSA 
office. In addition, applicants may download a copy of Form CCC-1155 at 
http://www.fsa.usda.gov/dafp/psd/.
    (b) A request for payments under this part must be submitted on a 
completed Form CCC-1155. Form CCC-1155 should be submitted to the FSA 
county office servicing the county where the producer is located but, 
in any case, must be received by the FSA county office by the close of 
business on December 29, 2000. Applications not received by the close 
of business on December 29, 2000, will be returned as not having been 
timely filed and the producer will not be eligible for payments under 
this program.
    (c) The wool and mohair producer requesting payments under this 
part must certify with respect to the accuracy and truthfulness of the 
information provided in their application for payments. All information 
provided is subject to a spot check 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 payments. Furnishing the data is voluntary; however, without it 
program payments will not be approved. Providing a false certification 
to the Government is punishable by imprisonment, fines and other 
penalties.


Sec. 1469.105  Eligibility.

    (a) Producers. To be eligible to receive a payment under this 
subpart, a producer must:
    (1) Have produced domestic wool and/or domestic mohair during the 
period of January 1, 1999, through December 31, 1999.
    (2) Be engaged in the business of producing and marketing 
agricultural products at the time of filing the application; and
    (3) Apply for payment during the application period.
    (b) Eligible wool and mohair. (1) Wool and mohair is eligible to 
generate payments under this subpart only if the wool or mohair was 
produced by shearing live animals (not wool or mohair which is pulled 
or which is shorn from hides or pelts) and only if such shearing 
occurred in 1999 and in the United States.
    (2) The producer applying for payment must have owned the wool or 
mohair at the time of shearing and must have owned in the United States 
the sheep, lambs, or goats from which the wool or mohair was shorn for 
30 days or more at any time prior to shearing and actually owned the 
animal at the time of shearing.


Sec. 1469.106  Payment rate and amount.

    (a) Payment rate.
    (1) The payment rate for wool is 20 cents per pound.
    (2) The payment rate for mohair is 40 cents per pound.
    (b) Payment amount. The payment amount for wool or mohair will be 
calculated by multiplying the certified pounds by the payment rate.


Sec. 1469.107  Offsets.

    Any payment or portion thereof due any person under this part shall 
be allowed without regard to questions of title under State law, and 
without regard to any claim or lien against the wool, the sheep, the 
mohair or the angora goats thereof, or proceeds thereof, in favor of 
the producer or any other creditors except agencies of the U.S. 
Government. The regulations governing offsets and withholdings found at 
7 CFR part 1403 shall be applicable to this part.


Sec. 1469.108  Appeals.

    Any producer who 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 7 
CFR parts 11 and 780.


Sec. 1469.109  Misrepresentation.

    (a) Whoever issues a false document or otherwise acts in violation 
of the provisions of this subpart so as to enable a producer to obtain 
a payment to which such producer is not entitled, shall become liable 
to CCC for any payment which CCC may have made in reliance on such 
sales document or as a result of such other action.
    (b) The issuance of a false document or the making of a false 
statement in an application for payment or other document, for the 
purpose of enabling the producer to obtain a payment to which such 
producer is not entitled, may subject the person issuing such document 
or making such statement to liability under applicable Federal civil 
and criminal statutes.


Sec. 1469.110  Maintaining records.

    Producers making application for a payment under this subpart must 
maintain accurate records and accounts that will document that they 
meet all eligibility requirements specified in this subpart. Such 
records and accounts must be retained for 3 years after the date of 
payment to the producer under this subpart.


Sec. 1469.111  Estates, trust, 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 an otherwise eligible producer of wool or mohair 
shall be eligible for assistance under this part only if such producer 
meets one of the following requirements:
    (1) The minor establishes that the right of majority has been 
conferred on the minor by court proceedings or by statute;
    (2) A guardian has been appointed to manage the minor's property 
and has executed the applicable program documents; or
    (3) A bond is furnished under which the surety guarantees any loss 
incurred for which the minor would be liable had the minor been an 
adult.


Sec. 1469.112  Death, incompetency, or disappearance.

    In the case of death, incompetency, disappearance or dissolution of 
a wool or mohair producer that is eligible to receive benefits in 
accordance with this part, such person or persons specified in 7 CFR 
part 707 may receive such benefits.


Sec. 1469.113  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 producer 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 7 CFR part 1403.
    (b) All producers signing an application for payment as having an 
interest shall be jointly and severally liable for any refund, 
including related charges, that is determined to be due for any reason 
under the terms and conditions of the application or this part.
    (c) Interest shall be applicable to refunds required of any 
producer under this part if FSA determines that payments or other 
assistance were provided to a producer who was not eligible for such 
assistance. Such interest shall be charged at the rate of interest that 
the United States Treasury charges the Commodity Credit Corporation 
(CCC) for funds, as of the date FSA made benefits available. Such 
interest shall accrue from the date of

[[Page 65728]]

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 producer.
    (d) Interest determined in accordance with paragraph (c) of this 
section may not be waived on refunds required of the producer when 
there was no intentional misaction on the part of the producer, as 
determined by FSA.
    (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) Producers must refund to FSA any excess payments made by FSA 
with respect to such application.
    (g) In the event that a benefit under this subpart was provided as 
the result of erroneous information provided by any producer, the 
benefit must be repaid with any applicable interest.

    Signed in Washington, D.C., on October 25, 2000.
 Keith Kelly,
Executive Vice President, Commodity Credit Corporation.
[FR Doc. 00-27794 Filed 10-27-00; 10:26 am]
BILLING CODE 3410-05-P