[Federal Register Volume 66, Number 53 (Monday, March 19, 2001)]
[Rules and Regulations]
[Pages 15538-15547]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-6626]



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Part II





Department of Agriculture





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Commodity Credit Corporation



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7 CFR Parts 1430 and 1439



Dairy Price Support, Dairy Recourse Loan, Livestock Assistance, 
American Indian Livestock Feed, and Pasture Recovery Programs; Final 
Rule

  Federal Register / Vol. 66, No. 53 / Monday, March 19, 2001 / Rules 
and Regulations  

[[Page 15538]]


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DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

7 CFR Parts 1430 and 1439

RIN 0560-AG32


Dairy Price Support, Dairy Recourse Loan, Livestock Assistance, 
American Indian Livestock Feed, and Pasture Recovery Programs

AGENCIES: Commodity Credit Corporation, USDA.

ACTION: Final rule.

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SUMMARY: This rule implements provisions of the Agriculture, Rural 
Development, Food and Drug Administration, and Related Agencies 
Appropriations Act, 2001 (the 2001 Act) related to the Dairy Price 
Support, Dairy Recourse Loan, Livestock Assistance (LAP), American 
Indian Livestock Feed (AILFP), and Pasture Recovery (PRP) Programs. 
Dairy price support is extended through calendar year 2001 and dairy 
recourse loans are postponed until January, 2002. The LAP and PRP are 
being extended to cover disaster-related losses that occurred in 
calendar year 2000 and the AILFP was given additional funding. Other 
provisions of the 2001 Act will be implemented under separate rules.

DATES: Effective March 14, 2001.

FOR FURTHER INFORMATION CONTACT: For dairy: Dan Colacicco, Director, 
Dairy and Sweeteners Analysis Division, Farm Service Agency (FSA), U.S. 
Department of Agriculture, STOP 0508, 1400 Independence Ave., SW., 
Washington, DC 20250-0540, telephone 202-720-6733, e-mail: 
[email protected]. For LAP, AILFP: Diane Sharp, Director, 
Production, Emergency, and Compliance Division, Farm Service Agency 
(FSA), U.S. Department of Agriculture, STOP 0517, 1400 Independence 
Ave., SW., Washington, DC 20250-0540, telephone (202)720-7641, e-mail: 
[email protected]. For PRP: Robert Stephenson, Director, 
Conservation, and Environmental Protection Division, Farm Service 
Agency (FSA), U.S. Department of Agriculture, STOP 0513, 1400 
Independence Ave., SW., Washington, DC 20250-0540, telephone (202)720-
5295, e-mail: [email protected].

SUPPLEMENTARY INFORMATION:

Notice and Comment

    Section 840 of the 2001 Act (Public Law 106-387) requires that the 
regulations necessary to implement the provisions regarding LAP, AILFP, 
and PRP be issued as soon as practicable and without regard to the 
notice and comment provisions of 5 U.S.C. 553 or the Statement of 
Policy of the Secretary of Agriculture (the Secretary) effective July 
24, 1971 (36 FR 13804) relating to notices of proposed rulemaking and 
public participation in rulemaking. These provisions are thus issued as 
final and are effective immediately.
    Similarly, section 742 of the 2001 Act, relating to the dairy 
provisions, amends section 141 of the Agricultural Market Transition 
Act (AMTA) (7 U.S.C. 7251). The amendment made by the 2001 Act merely 
extends the current program for one year and delays the effectiveness 
of the loan provisions until 2002. These statutory amendments supercede 
existing regulations, such that the changes to the regulations have 
effectively been made by the 2001 Act, and this rule merely carries out 
and announces those amendments. Additionally, the 2001 Act amended 
provisions of AMTA for which 7 U.S.C. 7281 provides an identical 
exemption from public notice and comment, allowing CCC to issue the 
dairy provisions as a final rule, effective immediately.

Executive Order 12866

    This final rule is issued in conformance with Executive Order 12866 
and has been determined to be economically significant and has been 
reviewed by the Office of Management and Budget. Cost/benefit 
assessments were completed and are summarized after the background 
section explaining the actions this rule will take.

Regulatory Flexibility Act

    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

    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 3015, subpart V, 
published at 48 FR 29115 (June 24, 1983).

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 
judicial action may be brought concerning the provisions of this rule, 
the administrative remedies must be exhausted.

Unfunded Mandates Reform Act of 1995

    The provisions of Title II of the Unfunded Mandates Reform Act of 
1995 are 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. 
Further, in any case, these provisions do not impose any mandates on 
state, local or tribal governments, or the private sector.

Small Business Regulatory Enforcement Fairness Act of 1996 (Chapter 
8 of the Administrative Procedures Act)

    Section 840 of the 2001 Act requires that the regulations necessary 
to implement the provisions for LAP, AILFP, and PRP be issued as soon 
as practicable and 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. Section 
840 also requires that the Secretary use the provisions of 5 U.S.C. 808 
(the Small Business Regulatory Enforcement Fairness Act (SBREFA)), to 
find that good cause exists to implement the rule immediately and that 
public notice is impracticable, unnecessary, or contrary to the public 
purpose. CCC finds that because this rule affects the incomes of a 
large number of agricultural producers who have been hit hard by 
natural disasters and poor market conditions it would be contrary to 
the public interest to delay those provisions of this rule, as 
expressed in the 2001 Act. Therefore, this rule is issued as final, 
effective immediately.
    With respect to the dairy provisions, CCC interprets theses 
statutory requirements as superceding existing regulations, such that 
the changes to the regulations have effectively been made by the 2001 
Act and this rule merely carries out and announces those amendments. 
Additionally, the 2001 Act amends provisions of AMTA for which 7 U.S.C. 
7281 provides an

[[Page 15539]]

identical exemption from notice and comment. Accordingly, the 
implementing regulations are effective immediately.

Paperwork Reduction Act

    There are no information collections associated with the dairy 
provisions of this rule. In addition, section 840 of the 2001 Act 
requires that the regulations implementing the provisions regarding 
LAP, AILFP, and PRP be promulgated without regard to the Paperwork 
Reduction Act. This means that the normal 60-day public comment period 
and OMB approval of the information collections required by this rule 
are not required before the regulations may be made effective. However, 
the 60-day public comment period and OMB approval under the provisions 
of 44 U.S.C. chapter 35 are still required for LAP, AILFP, and PRP 
after the rule is published.

Background

    This rule will implement requirements of the Agriculture, Rural 
Development, Food and Drug Administration, and Related Agencies 
Appropriations Act, 2001, (the 2001 Act) (Public Law 106-387) related 
to the Dairy Price Support, Dairy Recourse Loan, Livestock Assistance 
(LAP) Pasture Recovery (PRP), and American Indian Livestock Feed 
(AILFP) Programs. The provisions are as follows.

1. 7 CFR Part 1430--Dairy Price Support Program and Dairy Recourse Loan 
Program

    Section 742 of the 2001 Act postpones the termination date of the 
Milk Price Support Program until December 31, 2001, and continues the 
$9.90 per hundredweight support rate for milk that was in effect during 
calender years 1999 and 2000 through the year 2001. Section 742 also 
postpones the start of the Recourse Loan Program for Commercial 
Processors of Dairy Products--from January 1, 2001, to January 1, 2002. 
This rule modifies the provisions of 7 CFR part 1430 accordingly.

2. 7 CFR Part 1439, Subpart B--Livestock Assistance Program

    Section 806 of the 2001 Act requires that the Secretary of 
Agriculture use $490 million of the funds of the Commodity Credit 
Corporation to make and administer payments for livestock losses using 
the criteria established to carry out the 1999 Livestock Assistance 
Program (1999 LAP) to producers for losses in a county that has 
received an emergency designation by the President or the Secretary 
after January 1, 2000. The funds are available through September 30, 
2001. The statute further provides that of the $490 million, up to $40 
million may be used for the Pasture Recovery Program (PRP), up to $12 
million for the American Indian Livestock Feed Program (AILFP); and as 
amended by section 101(5) of the Consolidated Appropriations Act, 2001, 
(Pub. L. 106-554), $5 million to be transferred to the State of Alabama 
to be used in conjunction with the program administered by the Alabama 
Department of Agriculture and Industries, $2 million for losses due to 
Poult Enteritis Mortality Syndrome, and $300,000 to be transferred to 
the State of Montana for transportation needs associated with emergency 
haying and feeding, leaving $430.7 million for LAP-2000. This rule does 
not implement the program provisions of Public Law 106-554. Public Law 
106-554 also mandated a Government-wide rescission of 0.22 percent of 
appropriated funds. Available funding for the livestock programs is 
thus reduced to $429.752 million for LAP, $39.912 million for PRP, and 
$11.974 for AILFP.
    Livestock producers who suffered livestock feed losses as a result 
of natural disaster may apply for benefits to compensate for losses 
that occurred in calendar year 2000. Benefits will be provided to 
eligible livestock producers only in those counties where a natural 
disaster occurred and that were subsequently approved by FSA's Deputy 
Administrator for Farm Programs. A county must have suffered a 40-
percent or greater grazing loss for 3 consecutive months during the 
2000 calendar year as a result of damage due to a natural disaster in 
order to be eligible. Livestock producers in counties contiguous to an 
approved county are not eligible. A livestock producer in an approved 
county must have suffered at least a 40-percent loss of normal grazing 
for the producer's eligible livestock for a minimum of 3 consecutive 
months. Losses will only be compensable up to 80 percent of the total 
grazing available and the compensable loss may not exceed a county 
maximum set by the local FSA county committee. Payments will be made 
according to a formula subject to funding and other limitations, 
including a $40,000 per person payment limitation and a $2.5 million 
gross revenue limitation. In the event that the total amount of claims 
submitted under this subpart exceeds the funding available for LAP-
2000, each payment shall be reduced by a uniform national percentage.

3. 7 CFR Part 1439, Subpart D--Pasture Recovery Program

    Section 806 of the 2001 Act provides that the Secretary may use up 
to $40 million of CCC funds to carry out a Pasture Recovery Program 
(PRP), reduced $39.912 million by the 0.22 percent Government-wide 
rescission. These funds are to be used to compensate livestock 
producers in reseeding permanent pasture that was severely damaged or 
destroyed by natural disaster during calendar year 2000. PRP payments 
will be authorized only in counties that requested and were determined 
eligible for the Emergency Conservation Program (ECP) for losses during 
2000. Requests must be received by a date determined and announced by 
FSA to be eligible. For the land to be eligible, it must be established 
pasture land on which livestock is normally grazed but that was so 
damaged or destroyed by natural disaster that seeding is required to 
reestablish a cover. Hayland and rangeland will not be eligible, nor 
will land operated by the Federal or a State Government or a political 
subdivisions of a State.
    Eligible producers must agree to reestablish the forage crop and 
maintain the crop for three full years after the calendar year of 
installation. To be an eligible recipient of program benefits, the 
applicant must be an owner or operator of eligible land damaged or 
destroyed in 2000 who normally grazes livestock on such land and such 
applicant must be the person who will restore and maintain the property 
for three full calendar years after the year of installation.
    All conditions must be satisfied if a person is to be eligible for 
a PRP payment. For example, if an owner leases pasture land to an 
operator for grazing the operator's livestock, then the operator is 
eligible for a PRP payment only if the operator reestablishes the 
forage crop on the leased pasture land and has a lease and the 
equipment necessary to maintain the forage crop for three full calendar 
years after the year of installation. If an owner leases pasture land 
to an operator who normally grazes the operator's livestock but the 
owner agrees to reestablish the forage crop on the pasture land, then 
neither the operator nor the owner are eligible for PRP benefits 
because neither can meet all of the eligibility requirements. The owner 
is ineligible because the owner does not normally graze livestock on 
the pasture land, and the operator is ineligible because the operator 
did not reestablish the forage crop on the pasture land. Other

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restrictions will apply as well in the administration of the program.
    This program will be subject to the general provisions for 
emergency livestock assistance programs found in Subpart A of part 
1439. Among other provisions, that subpart provides for limitations on 
total benefits that a person may receive and the gross revenue of 
eligible persons. The gross revenue limitation will apply to the PRP. 
However, a different benefit limitation is provided in this rule.
    Accordingly, and in order to efficiently maximize the use of 
program funds for those farmers most in need of relief, the PRP will 
not be available to a person whose annual gross revenue is in excess of 
$2.5 million. Further, benefits are limited to $2,500 per ``person'' 
determined according to the ``person'' determination regulations at 7 
CFR part 1400.
    In order to receive payments, applicants will be required to 
certify that pasture land to be enrolled in the PRP was so damaged or 
destroyed by natural disaster during calendar year 2000 that seeding is 
required to reestablish the forage crop. State Farm Service Agency 
(FSA) committees will establish per-acre payment rates equal to 65 
percent of the eligible area's average cost of reestablishing the 
approved forage crop on eligible pasture land not to exceed $100 per 
acre. The FSA Deputy Administrator for Farm Programs may approve higher 
per-acre payment rates not to exceed $125 per acre. In no case will 
per-acre payment rates exceed $125 per acre. Seeding and related 
fertilizing requirements will be required to be carried out according 
to standards for agronomic practices and applicable environmental laws 
and regulations. Payments may be issued upon certification by the 
participant that approved practices to reestablish the forage crop have 
been completed. Certifications are subject to spot-check by FSA.
    Signup periods for this new program will be announced by CCC, but 
are expected to be conducted no later than the spring 2001 planting 
season for affected regions. It is expected that all seeding will be 
required to be completed in calendar year 2001 by a date announced by 
CCC.

4. 7 CFR Part 1439, Subpart I--American Indian Livestock Feed Program

    The American Indian Livestock Feed Program (AILFP) makes assistance 
available to eligible livestock owners when, as a result of natural 
disaster occurring on tribal-governed land, a significant loss of 
livestock feed has occurred and a livestock feed emergency exists, as 
determined by FSA's Deputy Administrator for Farm Programs. Section 806 
of the 2001 Act provided that, of the $490 million of CCC funds made 
available for livestock assistance, up to $12 million could be used for 
the AILFP, which was later reduced to $11.973 million by the 0.22 
percent Government-wide rescission. The regulations for the AILFP 
finalized on June 8, 2000 (65 FR 86578) included a statement that the 
program was funded for $12.5 million. This rule will amend the AILFP 
regulations to conform with the additional funding provided by the 2001 
Act, which will be available when the original $12.5 million is 
exhausted.

Cost-Benefit Assessment

Summary

    Outlays for the programs this rule implements are shown in the 
table below. Discussion of the individual programs follows.

                           Summary of Outlays
                        [In millions of dollars]
------------------------------------------------------------------------
                           Program                              Outlays
------------------------------------------------------------------------
2000 Livestock Assistance Program (LAP-2000)\1\..............    429.752
American Indian Livestock Feed Program (AILFP)\1\............     11.974
Pasture Recovery Program (PRP)\1\............................     39.912
    Total Livestock Assistance...............................    481.638
Dairy Price Support..........................................        470
Dairy Recourse Loan..........................................          0
                                                              ----------
    Total....................................................   951.638
------------------------------------------------------------------------
\1\ Original appropriation minus 0.22% rescission.

Dairy Price Support and Dairy Recourse Loan

    The total cost to CCC for extending the milk price support program 
one year is estimated at $470 million. The Dairy Recourse Loan Program 
is not expected to have a net cost to CCC because the loans will be 
secured and must be repaid in full. The federal cost to administer the 
recourse loan program that would replace the milk price support program 
is similar to the cost of administering the milk price support program 
so there is no net change in program costs.
    Extending the milk price support program will help maintain the 
all-milk price and dairy farm incomes because CCC's purchase price is 
providing a floor under the current market price for nonfat dry milk 
(NDM). The domestic price of NDM would be expected to fall at least 10 
cents per pound if the program were not extended. The 10-cent-per-pound 
drop in the price of NDM would be expected to allow a drop in the all-
milk price of about 10-14 cents per cwt., which would reduce dairy 
income by about $200-300 million.

2000 Livestock Assistance Program (LAP-2000)

    It is estimated that over 31 million head of cattle, 3 million 
horses, and 2 million sheep are in the affected states. The potential 
cost of the LAP-2000 before application of a national factor is 
estimated to be about $450 million. Because projected claims exceed the 
$429.752 million expected to be available for the program, each 
producer's payment will be prorated based on the ratio of the maximum 
allowed benefits to total claims. Payments will assist producers 
affected by disasters in meeting their financial obligations for income 
lost due to poor grazing conditions. It is assumed, in part as a result 
of the LAP, that producers affected by the disaster will remain in 
business. The impact of the payments on livestock prices and feed 
prices is expected to be small. For those producers who actually 
suffered the losses, the impact on their equity and cash flow positions 
is significant. In the absence of this program, some producers would 
have been forced to liquidate their herds, increasing livestock 
supplies and lowering prices in the short term. The changes would 
likely be small and temporary. Thus, the impact on consumers would be 
negligible. Aggregate farm income in 2000 is expected to be about 
$429.7 million higher.

American Indian Livestock Feed Program (AILFP)

    Natural disasters continue to cause significant loss of livestock 
feed production on land governed by American Indian Tribes. The states 
primarily affected during the 2000 crop year were Montana, Arizona, 
Oklahoma, Colorado, and New Mexico. A large proportion of American 
Indian livestock producers reside in communities where the USDA has had 
difficulty coordinating and implementing programs to meet the needs and 
financial constraints of American Indians.
    Up to $11.974 million will be available to American Indian tribes 
to provide to producers who suffered loss of livestock feed production 
as a result of a natural disaster occurring on tribal-governed land 
during 2000 and subsequent years. For assistance to be made available, 
a loss of feed grain and forage used for livestock production in

[[Page 15541]]

the affected region must exceed 35 percent and the Deputy Administrator 
for Farm Programs (DAFP) must declare a livestock feed emergency. The 
35 percent loss for the region is similar to the loss level required 
under past programs. In addition, the livestock producer must have 
livestock production in the geographic region that has been determined 
to meet the eligibility requirements for the program.
    Individual producer assistance is determined based on the estimated 
value of livestock feed needed to maintain the producer's eligible 
livestock. Assistance is paid at a rate of either 30 percent of the 
cost of purchased feed needed to maintain the producer's eligible 
livestock for the approved feeding period, or 30 percent of the 
eligible livestock owner's calculated Animal Unit Days (AUD) for the 
approved feeding period, whichever is smaller. This rate is the same 
rate of loss coverage that FSA has used in previous livestock feed 
programs. If any feed has been sold by producers these receipts must be 
reported as feed sold and the total amount deducted from the calculated 
payment amount.
    Program assistance will be provided on a first-come, first-serve 
basis. Thus, if total claims in 2000 exceed $11.974 million, the first 
$11.974 million in qualifying claims will receive assistance. Using 
this procedure eliminates the need to make partial payment and withhold 
some assistance until all claims are processed to determine a prorating 
factor for final assistance payments. A downside to first-come, first-
serve is that some tribes otherwise eligible for assistance may not be 
paid if available funds are exhausted. Spending between November 27, 
1998 and November 16, 2000, totaled $11.4 million. Current funding is 
expected to last into 2002 if similar claims are filed as with the past 
program.
    AILFP provides financial assistance to eligible livestock producers 
who have suffered significant loss of livestock feed production for the 
2000 calendar year and subsequent years. These funds will assist 
eligible livestock producers in meeting financial obligations against 
purchased feed stocks needed to maintain livestock enterprises on the 
farm as a result of lost livestock feed production on the farm. 
Further, the impact of the livestock feed program on livestock feed and 
livestock prices and consumer prices is not expected to be measurable. 
Based on program funding of $11.974 million for 2000 and subsequent 
years, program assistance is less than 1 percent of the national value 
of all livestock feed production. Assistance, therefore, will not have 
a measurable impact on national price levels for livestock feed 
ingredients or livestock. Aggregate American Indian farm income losses 
will be somewhat offset or reduced by AILFP payments. Federal outlays 
could increase by up to $11.974 million for the 2001 program year, but 
funds are expected to cover two years of loss claims.

Pasture Recovery Program (PRP)

    Funds to reestablish pasture damaged by drought will be allocated 
from funds provided for livestock loss assistance under the 2001 Act. 
PRP payments will be authorized only in counties determined eligible 
for the for the ECP. Applications for payment will probably exceed the 
funding level of $39.912 million based on the expected number of 
eligible producers and re-seeding costs. To be eligible, land must be 
established pasture land on which livestock are normally grazed and 
that was so damaged by drought or other natural disaster that seeding 
is required to reestablish a cover crop. Neither hay land nor rangeland 
is eligible.
    Payment rates per acre will equal 65 percent of the eligible area's 
average cost of reestablishing the approved forage crop. FSA State 
committees will establish the average cost of reestablishing the 
approved forage crop.
    The cost to reestablish pastures is assumed to be between $100 and 
$250 per acre, depending on the tillage and fertilization rates 
required. Most are expected to fall between $100 and $150 per acre, 
which will allow producers a payment rate of $65-97.50 per acre. At an 
average payment rate of $81.25 per acre and subject to the $2,500 
limitation producers could reestablish pasture on about 30 acres. Farm 
income is expected to increase by $39.912 million, equal to government 
outlays.
    For further information on the cost/benefit assessments, contact 
Dan Colacicco, 202-720-6733.

List of Subjects

7 CFR Part 1430

    Dairy products, Price support programs, Reporting and recordkeeping 
requirements.

7 CFR Part 1439

    Animal feeds, Disaster assistance, Grant programs--agriculture, 
Livestock, Pasture, Reporting and recordkeeping requirements.

    For the reasons set out in the preamble, 7 CFR parts 1430 and 1439 
are amended as set forth below.

PART 1430--DAIRY PRODUCTS

    1. The authority citation for part 1430 continues to read as 
follows:

    Authority: 7 U.S.C. 7251 and 7252; and 15 U.S.C. 714b and 714c.

Subpart A--Price Support Program for Milk

    2. Amend Sec. 1430.2 by revising paragraph (a)(1) to read as 
follows:


Sec. 1430.2  Price support levels and purchase conditions.

    (a)(1) The levels of price support provided to farmers marketing 
milk containing 3.67 percent milkfat from dairy cows are: $10.35 per 
hundredweight for calendar year 1996, $10.20 per hundredweight for 
calendar year 1997, $10.05 per hundredweight for calendar year 1998, 
and $9.90 per hundredweight for calendar years 1999 through 2001.
* * * * *

Subpart C--Recourse Loan Program for Commercial Processors of Dairy 
Products

    3. Amend Sec. 1430.401 by revising paragraph (a) to read as 
follows:


Sec. 1430.401  Applicability.

    (a) The regulations in this subpart are applicable to eligible 
dairy products produced after December 31, 2001. The regulations in 
this subpart set forth the terms and conditions under which CCC will 
make recourse loans to eligible processors. Additional terms and 
conditions shall be those set forth in the loan application and the 
note and security agreement which a processor must execute in order to 
receive such a loan.
* * * * *

    4. Amend Sec. 1430.403 by revising paragraph (a) to read as 
follows:


Sec. 1430.403  Loan rates.

    (a) The Secretary will announce before January 1, 2002, and 
thereafter, before October 1 of each year, that a recourse loan program 
is available under this subpart, and loan rates for Cheddar cheese, 
butter, and nonfat dry milk based on a milk equivalent value of $9.90 
per hundredweight of milk containing 3.67 percent butterfat.
* * * * *

    5. Amend Sec. 1430.407 by revising paragraph (a)(2) to read as 
follows:


Sec. 1430.407  Availability, disbursement, and maturity of loans.

    (a) * * *
    (2) A request for an initial loan must be filed no later than 
September 30 of

[[Page 15542]]

the fiscal year in which the product was produced, but no earlier than 
January 1, 2002.
* * * * *

PART 1439--EMERGENCY LIVESTOCK ASSISTANCE

    6. The authority citation continues to read as follows:

    Authority: 7 U.S.C. 1427a; 15 U.S.C. 714 et seq.; Sec. 1103 Pub. 
L. 105-277, 112.

    Stat. 2681-42-44; Pub. L. 106-31, 113 Stat. 57; Pub. L. 106-78, 
113 Stat. 1135; Pub. L. 106-113, 113 Stat. 1501; Sec. 257 Pub. L. 
106-224, 114 Stat. 358; Secs. 802, 806, & 813 Pub. L. 106-387, 114 
Stat. 1549.

    7. Revise Subpart B of part 1439 to read as follows:
Subpart B--Livestock Assistance Program
Sec.
1439.101   Applicability.
1439.102   Definitions.
1439.103   Application process.
1439.104   County committee determinations of general applicability.
1439.105   Loss criteria.
1439.106   Livestock producer eligibility.
1439.107   Calculation of assistance.
1439.108   Availability of funds.
1439.109   Financial considerations.

Subpart B--2000 Livestock Assistance Program


Sec. 1439.101  Applicability.

    (a) This subpart sets forth the terms and conditions applicable to 
the 2000 Livestock Assistance Program (LAP-2000) authorized by Public 
Law 106-387, 114 Stat. 1549. Program regulations for prior livestock 
assistance programs can be found at 7 CFR 1439 as it was published on 
January 1, 2001. Benefits will be provided to eligible livestock 
producers in the United States for LAP-2000 but only in counties where 
a natural disaster declaration was issued after January 1, 2000 by the 
President of the United States or the Secretary of Agriculture of the 
United States and that were subsequently approved for relief under this 
part by the Deputy Administrator for Farm Programs.
    (b) During the 2000 calendar year for LAP-2000, a producer must be 
in a county where a natural disaster declaration was approved after 
January 1, 2000, and also approved and determined by the Deputy 
Administrator for Farm Programs (or a designee) as having suffered 
losses during calendar year 2000. Contiguous counties that were not 
designated as a disaster area in their own right will not be eligible 
for participation in the LAP-2000 under this part. Grazing losses must 
have occurred on native and improved pasture with permanent vegetative 
cover and other crops planted specifically for the sole purpose of 
providing grazing for livestock, but such losses do not include losses 
on, or with respect to, seeded small grain forage crops.
    (c) To be eligible for assistance under this subpart, a livestock 
producer's pastures must have suffered at least a 40-percent loss of 
normal carrying capacity for a minimum of 3 consecutive months during 
the relevant calendar year. The percent of loss eligible for 
compensation shall not exceed the maximum percentage of grazing loss 
for the county as determined by the county committee. In addition, the 
producer will not be compensated for that part of any loss that would 
represent payment of a loss greater than 80 percent.
    (d) Except as approved by the Deputy Administrator for Farm 
Programs (or designee), a livestock producer is not eligible to receive 
payments for the same loss under this subpart if that loss has been 
recovered under another Federal program of some other source.


Sec. 1439.102  Definitions.

    The definitions set forth in this section shall be applicable for 
all purposes of administering this subpart. The definitions in 
Sec. 1439.3 shall also be applicable, except where those definitions 
conflict with the definitions set forth in this subpart, in which case 
the definitions in this section will apply. The definitions follow:
    Application means the Form CCC-740, Livestock Assistance Program 
Application. The CCC-740 is available at county FSA offices.
    Livestock means beef and dairy cattle, buffalo and beefalo (when 
maintained on the same basis as beef cattle), sheep, goats, swine, and 
equine animals where such equine animals are used commercially for 
human food or kept for the production of food or fiber on the owner's 
farm.


Sec. 1439.103  Application process.

    (a) Livestock producers must submit a completed application prior 
to the close of business on March 23, 2000, or such other date as 
established and announced by the Deputy Administrator. The application 
and any other supporting documentation shall be submitted to the county 
FSA office with administrative authority over a producer's eligible 
grazing land or to the county FSA office that maintains the farm 
records for the livestock producer.
    (b) Livestock producers shall certify as to the accuracy of all the 
information contained in the application, and provide any other 
information to CCC that the county FSA office or committee deems 
necessary to determine the livestock producer's eligibility.


Sec. 1439.104  County committee determinations of general 
applicability.

    (a) County committees shall determine whether due to natural 
disasters their county has suffered a 40-percent loss affecting pasture 
and normal grazing crops for at least 3 consecutive months during 
calendar year 2000 for LAP-2000. In making this determination, county 
committees, using the best information available from sources including 
but not limited to: the Extension Service, the Natural Resources 
Conservation Service; the Palmer Drought Index; and general knowledge 
of local rainfall data, pasture losses, grazing livestock movement out 
of county, abnormal supplemental feeding practices for livestock on 
pasture and liquidation of grazing livestock, shall determine the 
percentage of grazing losses for pastures on a county-wide basis. The 
county committee shall submit rainfall data, percentage of grazing 
losses for each general type of pasture, and the weighted average 
percentage of grazing loss for the county, with State committee 
concurrence, to the Deputy Administrator on form CCC-654. The maximum 
grazing losses the county committees shall submit on form CCC-654 is 80 
percent. These determinations shall be subject to review and approval 
of the Deputy Administrator. For purposes of this subpart, such 
counties are called ``eligible counties.''
    (b) In each county, the county committee shall determine a LAP crop 
year. The LAP crop year shall be that period of time in a calendar year 
that begins with the date grazing of new growth pasture normally begins 
and ends on the date grazing without supplemental feeding normally ends 
in the county.
    (c) In and for each eligible county, the county committee shall 
determine normal carrying capacities for each type of grazing or 
pasture during the LAP crop year. The normal carrying capacity for the 
LAP crop year shall be the normal carrying capacity the county 
committee determines could be expected from pasture and normal grazing 
crops for livestock for the LAP crop year if a natural disaster had not 
diminished the production of these grazing crops.
    (d) In each eligible county, the county committee shall determine 
the payment period for the county. The payment period for the county 
shall be the period of time during the county's LAP crop year where for 
3 consecutive months

[[Page 15543]]

during 2000, the carrying capacity for grazing land or pasture was 
reduced by 40 percent or more from the normal carrying capacity.


Sec. 1439.105  Loss criteria.

    (a) Grazing land for which a livestock producer requests benefits 
must be within the physical boundary of the county for which a 
Presidential disaster declaration or Secretarial disaster declaration 
was granted for disasters occurring during calendar year 2000. 
Livestock producers in unapproved counties contiguous to an eligible 
county will not receive benefits under this subpart.
    (b) To be eligible for benefits under this subpart, a livestock 
producer in an eligible county must have suffered a loss of grazing 
production equivalent to at least a 40-percent loss of normal carrying 
capacity for a minimum of 3 consecutive months.
    (c) A producer shall certify each type of pasture and percentage of 
loss suffered by each type on the application. In establishing the 
percentage of grazing loss, producers shall consider the amount of 
available grazing production during the LAP crop year, whether more 
than the normal acreage of grazing land was required to support 
livestock during the LAP crop year, and whether supplemental feeding of 
livestock began earlier or later than normal.
    (d) The county committee shall determine the producer's grazing 
loss and shall consider the amount of available grazing production 
during the LAP crop year, whether more than the normal acreage of 
grazing land was required to support livestock during the LAP crop 
year, and whether supplemental feeding of livestock began earlier or 
later than normal. The county committee shall request the producer to 
provide proof of loss of grazing production if the county committee 
determines the producer's certified loss exceeds other similarly 
situated livestock producers.
    (e) The percentage of loss claimed by a livestock producer shall 
not exceed the maximum allowable percentage of grazing loss for the 
county as determined by the county committee in accordance with 
Sec. 1439.104(a). Livestock producers will not receive benefits under 
this subpart for any portion of their loss that exceeds 80 percent of 
normal carrying capacity.
    (f) Conservation Reserve Program acres released for haying and/or 
grazing and seeded small grain forage crops shall not be used to 
calculate losses under this subpart.


Sec. 1439.106  Livestock producer eligibility.

    (a) Only one livestock producer will be eligible for benefits under 
this subpart with respect to an individual animal.
    (b) Only owners of livestock who themselves provide the pasture or 
grazing land, including cash leased pasture or grazing land, for the 
livestock may be considered as livestock producers eligible to apply 
for benefits under this subpart.
    (c) An owner of livestock who uses another person to provide 
pasture or grazing land on a rate-of-gain basis is not considered to be 
the livestock producer eligible to apply for benefits under this 
subpart.
    (d) An owner who pledges livestock as security for a loan shall be 
considered as the person eligible to apply for benefits under this 
subpart if all other requirements of this part are met. Livestock 
leased under a contractual agreement that has been in effect at least 3 
months and establishes an interest for the lessee in such livestock 
shall be considered as being owned by the lessee.
    (e) Livestock must have been owned for at least 3 months before 
becoming eligible for payment.
    (f) The following entities are not eligible for benefits under this 
subpart:
    (1) State or local governments or subdivisions thereof; or
    (2) Any individual or entity who is a foreign person as determined 
in accordance with the provisions of Secs. 1400.501 and 1400.502 of 
this chapter.


Sec. 1439.107  Calculation of assistance.

    (a) The value of LAP assistance determined with respect to a 
livestock producer for each type and weight class of livestock owned or 
leased by such producer shall be the lesser of the amount calculated 
under paragraph (b) of this section (the total value of lost feed needs 
for eligible livestock) or calculated under paragraph (c) of this 
section (the total value of lost eligible pasture).
    (b) The total value of lost feed needs shall be the amount obtained 
by multiplying:
    (1) The number of days in the payment period the livestock are 
owned or, in the case of purchased livestock, meet the 3-month 
ownership requirement; by
    (2) The number of pounds of corn-equivalent per day, as established 
by CCC, that is determined necessary to provide the energy requirements 
established for the weight class and type of livestock; by
    (3) The 5-year national average market price for corn ($2.36 bushel 
or $0.0421428 per pound); by
    (4) The number of eligible animals of each type and weight range of 
livestock owned or leased by the person; by
    (5) The percent of the producer's grazing loss during the relevant 
period as certified by the producer and approved by the county 
committee in accordance with Sec. 1439.105.
    (c) The total value of lost eligible pasture shall be the amounts 
for each type of pasture calculated by:
    (1) Dividing the number of acres of each pasture type by the 
carrying capacity established for the pasture; and multiplying the 
result by
    (2) The 5-year national average market price for corn ($2.36 bushel 
or $0.0421428 per pound); by
    (3) The daily feed grain equivalent per animal (15.7 pounds of corn 
necessary for a beef cow, factored for the weight class and type of 
livestock, as determined by CCC); by
    (4) The applicable number of days in the LAP payment period; by
    (5) The percent of the producer's grazing loss during the relevant 
period as certified by the producer and approved by the county 
committee in accordance with Sec. 1439.105.
    (d) The final payment shall be the smaller of paragraph (b) of this 
section or paragraph (c) of this section multiplied by the national 
factor if required under Sec. 1439.108. The final payment shall not 
exceed 50 percent of the smaller of paragraph (b) or (c) of this 
section determined prior to applying the national factor provided for 
in Sec. 1439.108.
    (e) Seeded small grain forage crops shall not be counted as grazing 
land under paragraph (c) of this section with respect to supporting 
eligible livestock.
    (f) The number of equine animals that are used to calculate 
benefits under this subpart and in paragraph (a) of this section are 
limited to the number actually needed to produce food and fiber on the 
producer's farm or to breed horses and mules to be used to produce food 
and fiber on the owner's farm, and shall not include animals that are 
used for recreational purposes or are running wild or uncontrolled on 
land owned or leased by the owner.


Sec. 1439.108  Availability of funds.

    In the event that the total amount of claims submitted under this 
subpart exceed $429,752,460, each payment shall be reduced by a uniform 
national percentage. Such payment reductions shall be made after the 
imposition of applicable payment limitation provisions.

[[Page 15544]]

Sec. 1439.109  Financial considerations.

    (a) The provisions of Secs. 1439.10 and 1439.11 apply to LAP-2000.
    (b) Benefits under this part are not subject to administrative 
offset. See section 842 of the 2001 Act (Public Law 106-387, 114 Stat. 
1549).

    8. Revise Subpart D of Part 1439 to read as follows:
Subpart D--Pasture Recovery Program
Sec.
1439.301   Administration.
1439.302   Definitions.
1439.303   General description.
1439.304   Eligible persons.
1439.305   Eligible land.
1439.306   Duration of contracts.
1439.307   Gross revenue limitation.
1439.308-1439.319   [Reserved]
1439.320   Obligations of participant.
1439.321   Obligations of the Commodity Credit Corporation.
1439.322   Eligible practices.
1439.323-1439.329   [Reserved]
1439.330   Enrollment.
1439.331   Termination of PRP contracts.
1439.332   Contract modifications.
1439.333-1439.339   [Reserved]
1439.340   Payments.
1439.341   Levels and rates for payments.
1439.342-1439.349   [Reserved]
1439.350   Payments to participants.
1439.351   Violations.
1439.352   Executed PRP contract not in conformity with regulations.
1439.353   Performance based upon advice or action of representative 
of the Secretary of Agriculture.
1439.354   Access to land under contract.
1439.355   Appeals.
1439.356   Refunds to CCC; joint and several liability.
1439.357   Miscellaneous.

Subpart D--Pasture Recovery Program


Sec. 1439.301  Administration.

    (a) The regulations in this part will be administered under the 
general supervision and direction of the Executive Vice President, 
Commodity Credit Corporation (CCC), and the Deputy Administrator, for 
Farm Programs, Farm Service Agency (FSA). In the field, the regulations 
in this part will be administered by the FSA State and county 
committees (``State committees'' and ``county committees'', 
respectively).
    (b) State executive directors, county executive directors, and 
State and county committees do not have the authority to modify or 
waive any of the provisions in this part unless specifically authorized 
by the Deputy Administrator.
    (c) The State committee may take any action authorized or required 
by this part to be taken by the county committee that has not been 
taken by such committee, such as:
    (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 delegation herein to a State or county committee shall 
preclude the Executive Vice President, CCC, or a designee, or the 
Deputy Administrator from determining any question arising under this 
part or from reversing or modifying any determination made by a State 
or county committee.
    (e) Data furnished by the applicants will be used to determine 
eligibility for program benefits. Although participation in the Pasture 
Recovery Program (PRP) is voluntary, program benefits will not be 
provided unless the participant furnishes the appropriate data.


Sec. 1439.302  Definitions.

    The following definitions shall be applicable to this subpart:
    Applicant means, unless the context indicates otherwise, the owner 
or operator.
    Contract period means the period of time the PRP contract is in 
effect.
    Equine animals means horses, mules, and donkeys.
    Federally-owned land means land owned by the Federal Government or 
any department, bureau, or agency thereof, or any corporation whose 
stock is wholly owned by the Federal Government.
    Forage crop means a perennial stand of grasses or legumes that are 
intended for use by livestock for grazing and are customarily used for 
that purpose by local producers.
    FSA means the Farm Service Agency.
    Hayland means land that was or has been routinely used to produce 
hay.
    Livestock means beef and dairy cattle, buffalo and beefalo (when 
maintained on the same basis as beef cattle), sheep, goats, swine, and 
equine animals used commercially for human food or kept for the 
production of food or fiber.
    Local FSA office means the FSA office in the local USDA service 
center in which the FSA records are maintained for the farm or ranch 
that includes the pasture land that the applicant is seeking to enroll 
in the PRP.
    Operator means a person who is in general control of the farming 
operation on the farm, as determined by FSA for CCC.
    Owner means a person or entity who is determined by FSA to have 
sufficient legal ownership of the land, including a person who is 
buying the acreage under a purchase agreement; each spouse in a 
community property State; each spouse when spouses own property 
jointly; and a person who has life-estate in the property.
    Participant means an owner or operator or tenant who has entered 
into a PRP contract.
    Pasture land means generally enclosed land devoted to a perennial 
forage crop used and suitable for grazing of livestock.
    Payment means, unless the context indicates otherwise, the payment 
specified in the PRP contract that, subject to the availability of 
funds, is made to a participant to compensate such participant for 
reestablishing an approved forage crop on eligible pasture land in the 
PRP.
    Practice means with respect to practices to be approved for relief 
under this subpart, an approved measure to cost-effectively reseed 
pasture, and, in conjunction with seeding, as necessary, fertilize to 
reestablish a forage crop on eligible pasture land damaged or destroyed 
by natural disaster, as determined by CCC.
    Rangeland means land having indigenous, unimproved vegetation that 
may be used or suitable for open roaming and grazing of livestock.
    Secretary means the Secretary of Agriculture or a designee of the 
Secretary.
    State committee, State office, county committee, or county office, 
means the respective FSA committee or office.
    State Technical Committee means that committee established pursuant 
to 16 U.S.C. 3861.
    State-owned land means land owned by a State Government or any 
department, bureau, or agency thereof, including political subdivisions 
of a State, as determined by CCC.
    Technical assistance means the assistance provided in connection 
with the PRP to owners or operators by FSA or other authorized designee 
of the Secretary in determining the eligibility of land and 
implementing and certifying eligible practices.
    United States means all fifty states of United States, the 
Commonwealth of Puerto Rico, the Virgin Islands, Guam, and the District 
of Columbia.


Sec. 1439.303  General description.

    Under the PRP, the CCC will enter into contracts with eligible 
producers to provide payments to assist producers to reestablish the 
damaged or destroyed pasture land to an approved forage crop upon a 
promise and obligation to maintain the new crop for 3 full years after 
the calendar year of installation.

[[Page 15545]]

Sec. 1439.304  Eligible persons.

    In order to be eligible to enter into a PRP contract in accordance 
with this part, a person must be an owner or operator of eligible 
pasture land that was damaged or destroyed by natural disaster during 
calendar year 2000 and:
    (a) Must normally graze livestock on such pasture land; and
    (b) If an operator of eligible land that the operator does not own, 
must provide satisfactory evidence that such operator will be in 
control of such eligible pasture land for the full term of the PRP 
contract period.


Sec. 1439.305  Eligible land.

    (a) Except as otherwise provided in this section, land in the PRP 
must be pastureland that:
    (1) As determined by CCC, is located within a county that was 
approved for assistance under the Emergency Conservation Program 
provided for in 7 CFR part 701 because of a 2000 natural disaster, or 
was later approved for such participation based upon an application 
filed by such date as is determined and announced by the Deputy 
Administrator and based upon natural disaster damage suffered in 2000.
    (2) Has been established pasture land on which livestock is 
normally grazed or on which the forage crop was so damaged or destroyed 
by natural disaster in calendar year 2000 that the forage crop will not 
return in the 2001 grazing year, and seeding is required to reestablish 
the forage crop, as determined by CCC.
    (b) Notwithstanding paragraph (a) of this section, land, as 
determined by CCC, shall be ineligible for enrollment if the pasture 
land is:
    (1) Federal-operated land;
    (2) State-operated land;
    (3) Hayland; or
    (4) Rangeland, as determined by the CCC.


Sec. 1439.306  Duration of contracts.

    Contracts under this subpart and their forage crop maintenance 
requirements shall be for three years. The installation of the practice 
must be completed no later than the date specified in the PRP contract.


Sec. 1439.307  Gross revenue limitation.

    A person, as determined in accordance with part 1400 of this 
chapter, who has annual gross revenue in excess of $2.5 million shall 
not be eligible to receive assistance under this part. For the purpose 
of this determination, annual gross revenue means:
    (a) With respect to a person who receives more than 50 percent of 
such person's gross income from farming and ranching, the total gross 
revenue received from such operations; and
    (b) With respect to a person who receives 50 percent or less of 
such person's gross income from farming and ranching, the total gross 
revenue from all sources.


Secs. 1439.308-1439.319  [Reserved]


Sec. 1439.320  Obligations of participant.

    All participants subject to a PRP contract must agree to:
    (a) Carry out the terms and conditions of the PRP contract 
including carrying out all approved practices and meeting the schedule 
of dates for seeding and for maintenance measures provided for in the 
contract to establish and maintain the approved forage crop;
    (b) Comply with all requirements of part 12 of this title;
    (c) Comply with noxious weed laws of the applicable State or local 
jurisdiction on such land;
    (d) Control, subject to the contract, all weeds, insects, pests and 
other undesirable species to the extent necessary to ensure that the 
establishment and maintenance of the approved forage crop is adequately 
protected, as determined by CCC;
    (e) Not harvest the re-seeded cover crop at any time during the 
contract period; and
    (f) Be jointly and severally responsible with other persons 
qualifying for payments under this program on the same land for 
compliance with such contract and the provisions of this part and for 
any refunds, payment adjustments, or liquidated damages that may be 
required for violations of any of the terms and conditions of the PRP 
contract.


Sec. 1439.321  Obligations of the Commodity Credit Corporation.

    CCC shall:
    (a) Upon establishment of the required forage crop, and provided 
all other eligibility criteria have been met, make PRP payments to 
participants in accordance with the provisions of this part; and
    (b) Provide such technical assistance as it determines necessary to 
assist the participant in carrying out the PRP contract.


Sec. 1439.322  Eligible practices.

    Eligible practices are those practices specified in the contract 
that meet all quantity and quality standards needed to cost-effectively 
reestablish the approved forage crop, as determined by CCC, on acreage 
subject to the contract, including reseeding.


Secs. 1439.323-1439.329  [Reserved]


Sec. 1439.330  Enrollment.

    Only applications for contracts submitted by a participant at the 
FSA office responsible for administering CCC programs in the county 
where the participant's farm is located during designated signup 
periods, as announced by CCC, will be approved.


Sec. 1439.331  Termination of PRP contracts.

    (a) As determined by CCC, PRP contracts may be terminated before 
the expiration date when:
    (1) The owner loses control of, or transfers, all or part of the 
acreage under contract and the new owner does not wish to continue the 
contract;
    (2) The participant voluntarily requests in writing to terminate 
the contract and obtains the approval of CCC subject to such conditions 
on approval as may be determined by CCC;
    (3) The participant is not in compliance with the terms and 
conditions of the contract;
    (4) The same acreage is later enrolled in another State, Federal, 
or local conservation program;
    (5) The PRP practice fails and CCC determines the cost of restoring 
the cover outweighs the benefits received from the restoration; or
    (6) The PRP contract was approved based on erroneous eligibility 
determinations.
    (b) When a PRP contract is terminated, the participant must, except 
as agreed to by CCC, refund all or part of the payments made with 
respect to such contract plus interest thereon, as determined by CCC, 
and shall pay liquidated damages as provided for in such contract.


Sec. 1439.332  Contract modifications.

    By mutual agreement between CCC and the participant, a PRP contract 
may be modified in order to:
    (a) Decrease acreage in the PRP;
    (b) Facilitate the practical administration of the PRP; or
    (c) Accomplish the goals and objectives of the PRP, as determined 
by CCC.


Secs. 1439.333-1439.339  [Reserved]


Sec. 1439.340  Payments.

    (a) Payments shall be made available upon a determination by CCC 
that an eligible practice, or an identifiable unit thereof, has been 
established in compliance with the appropriate standards and 
specifications. Payments will be prorated if requests for assistance 
exceed available funding.
    (b) Except as otherwise provided for in this part, payments may be 
made

[[Page 15546]]

under the PRP only for the cost-effective establishment or installation 
of an eligible practice.
    (c) Payments shall be made in such amount and in accordance with a 
schedule specified in the PRP contract.
    (d) Payment shall be made on a per-acre basis.
    (e) The payment shall be divided among the participants on a single 
contract in the manner agreed upon in such contract.
    (f) The maximum amount of all payments that a person may receive 
under the PRP shall not exceed $2,500. The regulations set forth at 
part 1400 of this chapter shall be applicable in making certain 
eligibility and ``person'' determinations as they apply to payment 
limitations under this part.
    (g) Payments shall be limited as needed or appropriate to account 
for mandatory or discretionary limits on payments.


Sec. 1439.341  Levels and rates for payments.

    (a) CCC shall pay not more than 65 percent of the average cost of 
reestablishing the approved forage crop, including reseeding, on 
eligible land.
    (b) The average cost of performing a practice may be determined by 
CCC based on recommendations from the State Technical Committee or on 
such other basis as it deemed appropriate.
    (c) Notwithstanding paragraph (a) or (b) of this section, no 
payment shall exceed $100 per acre without approval of the Deputy 
Administrator. In no case shall a payment exceed $125 per acre.


Secs. 1439.342-1439.349  [Reserved]


Sec. 1439.350  Payments to participants.

    Payments shall be made to the participants responsible for the 
establishment of the practice.


Sec. 1439.351  Violations.

    (a) If a participant fails to carry out the terms and conditions of 
a PRP contract, CCC may terminate the PRP contract.
    (b) If the PRP contract is terminated by CCC:
    (1) The participant shall forfeit all rights to payments under such 
contract and refund all payments previously received together with 
interest; and
    (2) Pay liquidated damages to CCC in such amount as specified in 
the contract.
    (c) If the Deputy Administrator determines such failure does not 
warrant termination of such contract, the Deputy Administrator may 
authorize relief as the Deputy Administrator deems appropriate.


Sec. 1439.352  Executed PRP contract not in conformity with 
regulations.

    If, after a PRP contract is approved by CCC, CCC discovers that the 
PRP contract is not in conformity with the provisions of this part, the 
provisions of the regulations in this part shall prevail and the 
contract may be terminated.


Sec. 1439.353  Performance based upon advice or action of 
representative of the Secretary of Agriculture.

    The provisions of Sec. 718.8 of this title relating to performance 
based upon the action or advice of a representative of the Secretary of 
Agriculture shall be applicable to this part.


Sec. 1439.354  Access to land under contract.

    (a) The applicant or participant shall, as requested, provide all 
representatives or designees of CCC with access to all land that is:
    (1) The subject of an application for a contract under this part; 
or
    (2) Under contract or otherwise subject to this part.
    (b) With respect to such land identified in paragraph (a) of this 
section, the participant or applicant shall provide such 
representatives with access to examine records with respect to such 
land for the purpose of determining compliance with the terms and 
conditions of the PRP.


Sec. 1439.355  Appeals.

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


Sec. 1439.356  Refunds to CCC; joint and several liability.

    (a) In the event there is a failure to comply with any term, 
requirement, or condition for payment or assistance arising under this 
part, and if any refund of a payment to CCC shall otherwise become due 
in connection with this part, all payments made in regard to such 
matter shall be refunded to CCC, together with interest as determined 
in accordance with paragraph (b) of this section and late-payment 
charges as provided for in part 1403 of this chapter.
    (b) All persons with a financial interest in the operation or in an 
application for payment shall be jointly and severally liable for any 
refund, including related charges, that is determined to be due CCC for 
any reason under this part.
    (c) Interest shall be applicable to refunds required of the 
livestock owner or other party receiving assistance or a payment if CCC 
determines that payments or other assistance were provided to the owner 
and the owner was not eligible for such assistance. Such interest shall 
be charged at the rate of interest that the United States Treasury 
charges CCC for funds, as of the date CCC made such benefits. Such 
interest that is determined to be due CCC shall accrue from the date 
such benefits were made available by CCC to the date of repayment or 
the date interest increases in accordance with part 1403 of this 
chapter. CCC may waive the accrual of interest if CCC determines that 
the cause of the erroneous determination was not due to any action of 
the livestock owner or other individual or entity receiving benefits.
    (d) Interest otherwise determined due in accordance with paragraph 
(c) of this section may be waived with respect to refunds required of 
the owner or other program recipient because of unintentional misaction 
on the part of the owner or other individual or entity, as determined 
by CCC.
    (e) Late payment interest shall be assessed on all refunds in 
accordance with the provisions of, and subject to the rates prescribed 
in part 1403 of this chapter.
    (f) Individuals or entities who are a party to any program operated 
under this part must refund to CCC any excess payments made by CCC with 
respect to such program.
    (g) In the event that any request for assistance or payment under 
this part was established as a result of erroneous information or a 
miscalculation, the assistance or payment shall be recomputed and any 
excess refunded with applicable interest.


Sec. 1439.357  Miscellaneous.

    (a) Any remedies permitted CCC under this part shall be in addition 
to any other remedy, including, but not limited to criminal remedies, 
or actions for damages in favor of CCC, or the United States, as may be 
permitted by law.
    (b) Absent a scheme or device to defeat the purpose of the program, 
when an owner loses control of PRP acreage due to foreclosure, CCC may 
waive the demand that could otherwise be made for refunds.
    (c) Payments under this subpart are subject to provisions contained 
in Subpart A of this part including, but not limited to provisions 
concerning misrepresentations, payment limitations, limitations on 
eligibility tied to the person's gross income, and refunds to CCC, 
liens, assignment of payments, and appeals, and

[[Page 15547]]

maintenance of books and records. In addition, other parts of this 
chapter and of chapter VII of this title relating to payments in event 
of death, the handling of claims, and other matters may apply, as may 
other provisions of law and regulation.
    (d) Any payments not earned that have been paid must be returned 
with interest subject to such other remedies as may be allowed by law.
    (e) No interest will be paid or accrue on benefits under this 
subpart that are delayed or otherwise not timely issued unless 
otherwise mandated by law.
    (f) Nothing in this subpart shall require a commitment of funds to 
this subpart in excess of that determined to be appropriate by the 
Deputy Administrator and/or CCC.
    (g) Any payment otherwise due under this subpart will be reduced to 
the extent that it is determined that such payment produces a duplicate 
benefit under another program operated by the Department of Agriculture 
and that to make such duplicate payment would be contrary to the 
purposes of the program.
    (h) In no instance may the amount expended under this subpart 
exceed $39.912 million.
    (i) Payments under this subpart 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 agencies of the U.S. Government. The 
regulations governing offsets and withholdings found at part 1403 of 
this chapter shall be applicable to PRP contract payments.
    (j) Any producer entitled to any payment may assign any payments in 
accordance with regulations governing assignment of payment found at 
part 1404 of this chapter.
    (k) In those instances in which, prior to the March 14, 2001 
effective date of this subpart, a producer has signed a power of 
attorney on an approved FSA-211 for a person or entity indicating that 
such power shall extend to ``all above programs'', without limitation, 
such power will be considered to extend to this program unless by April 
2, 2001 the person granting the power notifies the local FSA office for 
the control county that the grantee of the power is not authorized to 
handle transactions for this program for the grantor.
    (l) Livestock producers or any other individual or entity seeking 
or receiving assistance under this part shall maintain and retain 
records that will permit verification of PRP practice completion for at 
least 3 years following the end of the calendar year in which payment 
was made, or for such additional period as CCC may request. An 
examination of such records by a duly authorized representative of the 
United States Government shall be permitted at any time during business 
hours.
    (m) A person shall be ineligible to receive assistance under PRP 
and be subject to such other remedies as may be allowed by law, if, 
with respect to the PRP, it is determined by the State committee or the 
county committee or an official of FSA that such person has:
    (1) Adopted any scheme or other device that tends to defeat the 
purpose of a program operated under this part;
    (2) Made any fraudulent representation with respect to such 
program; or
    (3) Misrepresented any fact affecting a program determination.

Subpart I--American Indian Livestock Feed Program

    9. Revise Sec. 1439.901 to read as follows:


Sec. 1439.901  Applicability.

    This subpart sets forth the terms and conditions of a government-
to-government program titled the American Indian Livestock Feed Program 
(AILFP). Assistance will be available in those regions that CCC 
determines have been affected by natural disaster, and where a 
determination is made by the Deputy Administrator for Farm Programs 
that a livestock feed emergency exists on tribal land. Funds made 
available to CCC shall be available for any outstanding crop year 2000 
payment applications and in subsequent crop years contract requests 
until funding is exhausted. Payments may become available as contracts 
with tribal governments are approved. If any other benefits are 
received from the Department of Agriculture for the same loss, then 
payments under this part will be reduced accordingly. Payments will 
terminate when funds have been exhausted, without respect to the date 
of any application, or of when any contract has been entered into by 
any tribal government and CCC. Applicants will receive benefits on a 
first-come, first-served basis.

    10. Revise the last sentence of Sec. 1439.906(a) to read as 
follows:


Sec. 1439.906  Program availability.

    (a) * * * All contracts requesting region approval must be 
submitted by the date 30 days after the end of the disaster period 
specified on the contract.
* * * * *

    Dated: March 12, 2001.
James R. Little,
Executive Vice President, Commodity Credit Corporation.
[FR Doc. 01-6626 Filed 3-14-01; 11:53 am]
BILLING CODE 3410-05-P