[Federal Register Volume 67, Number 83 (Tuesday, April 30, 2002)]
[Rules and Regulations]
[Pages 21167-21170]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-10676]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1205

[CN-01-007]


Cotton Research and Promotion Program: Procedures for Conduct of 
Sign-up Period

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule will amend the rules and regulations regarding the 
procedures for the conduct of a sign-up period for eligible cotton 
producers and importers to request a continuance referendum on the 1991 
amendments to the Cotton Research and Promotion Order (Order) provided 
for in the Cotton Research and Promotion Act (Act) amendments of 1990. 
The amendments will update various dates, name changes, addresses, and 
make other administrative changes.

EFFECTIVE DATE: May 1 2002.

FOR FURTHER INFORMATION CONTACT: Whitney Rick, Chief, Research and 
Promotion Staff, Cotton Program, AMS, USDA, Stop 0224, 1400 
Independence Ave., SW., Washington, DC 20250-0224, telephone (202) 720-
2259, facsimile (202) 690-1718, or email at [email protected].

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    The Office of Management and Budget has waived the review process 
required by Executive Order 12866 for this action.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. It is not intended to have retroactive effect. This 
rule would not preempt any state or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with this 
rule.
    The Cotton Research and Promotion Act (7 U.S.C. 2101-2118) provides 
that administrative proceedings must be exhausted before parties may 
file suit in court. Under Section 12 of the Act, any person subject to 
an order may file with USDA a petition stating that the order, any 
provision of the order, or any obligation imposed in connection with 
the order is not in accordance with law and requesting a modification 
of the order or to be exempted there from. Such person is afforded the 
opportunity for a hearing on the petition. After the hearing, USDA 
would rule on the petition. The Act provides that the District Court of 
the United States in any district in which the person is an inhabitant, 
or has his or her principal place of business, has jurisdiction to 
review the USDA's ruling, provided a complaint is filed within 20 days 
from the date of the entry of ruling.

Regulatory Flexibility Act

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601 et seq.), the Agricultural Marketing Service 
has considered the economic effect of this action on small entities and 
has determined that its implementation will not have a significant 
economic impact on a substantial number of small entities.
    There are currently approximately 30,000 producers, and 
approximately 10,000 importers that are subject to the order. The 
majority of these producers and importers are small businesses under 
the criteria established by the Small Business Administration.
    Only those eligible persons who are in favor of conducting a 
referendum would need to participate in the sign-up period. Of the 
46,220 total valid ballots received in the 1991 referendum, 27,879, or 
60 percent, favored the amendments to the Order, and 18,341, or 40 
percent, opposed the amendments to the Order. This rule will provide to 
those persons who are not in favor of the continuance of the Order

[[Page 21168]]

amendments an opportunity to request a continuance referendum.
    The eligibility and participation requirements for producers and 
importers are substantially the same as the rules that established the 
eligibility and participation requirements for the 1991 referendum, and 
for the 1997 sign-up period. The January 15 through April 14, 1997 
sign-up period did not generate the required number of signatures to 
hold another referendum. These amendments in this action will update 
various dates, name changes, addresses and make other miscellaneous 
changes. However, proxy or power of attorney participation would be 
prohibited.
    The sign-up procedures will not impose a substantial burden or have 
a significant impact on persons subject to the Order, because 
participation is not mandatory, not all persons subject to the Order 
are expected to participate, and USDA will determine producer and 
importer eligibility. The information collection requirements under the 
Paperwork Reduction Act are minimal.

Paperwork Reduction Act

    The information collections in this rule will be carried out under 
the Office of Management and Budget (OMB) Control Number 0581-0093. 
This rule will not add to the overall burden currently approved by OMB 
and assigned OMB Control Number 0581-0093 under the provisions of the 
Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35). This OMB 
Control Number is referenced in Section 1205.541 of the regulations.

Background

    The 1991 amendments to the Cotton Research and Promotion Order (7 
CFR 1205 et seq.) were implemented following the July 1991 referendum. 
The amendments were provided for in the Cotton Research and Promotion 
Act (7 U.S.C. 2101-2118) amendments of 1990. These amendments provided 
for: (1) Importer representation on the Cotton Board by an appropriate 
number of persons, to be determined by USDA, who import cotton or 
cotton products into the U.S., and whom USDA selects from nominations 
submitted by importer organizations certified by USDA; (2) assessments 
levied on imported cotton and cotton products at a rate determined in 
the same manner as for U.S. cotton; (3) increasing the amount USDA can 
be reimbursed for the conduct of a referendum from $200,000 to 
$300,000; (4) reimbursing government agencies that assist in 
administering the collection of assessments on imported cotton and 
cotton products; and (5) terminating the right of producers to demand a 
refund of assessments.
    On January 14, 2002, USDA issued a determination based on its 
review, (67 FR 1714), not to conduct a referendum regarding the 1991 
amendments to the Order. However, the Act provides that USDA shall 
nevertheless conduct a referendum at the request of 10 percent or more 
of the total number of eligible producers and importers that voted in 
the most recent referendum. The Act provides for a sign-up period 
during which eligible cotton producers and importers may request that 
USDA conduct a referendum on continuation of the 1991 amendments to the 
Order. Accordingly, USDA will provide all eligible Upland cotton 
producers and importers an opportunity to request a continuance 
referendum regarding the 1991 amendments to the Order.
    The sign-up period will be provided for all eligible producers and 
importers. Eligible cotton producers would be provided the opportunity 
to sign-up to request a continuance referendum in person at the county 
FSA office where their farm is located. If the producers' land is in 
more than one county, the producer shall sign-up at the county office 
where FSA administratively maintains and processes the producer's farm 
records. Producers who choose not to visit the county FSA office in 
person may request a sign-up form from the same office.
    USDA will mail sign-up information, including a written request 
form, to all known, eligible, cotton importers. Importers who favor the 
conduct of a continuance referendum would return their signed request 
forms to USDA, FSA, ORAS, Attention: Phil Brockman, PO Box 23278, 
Washington, DC 20026-3278.
    Importers who do not receive a request form in the mail by June 3, 
2002, and who meet the eligibility requirements to participate in the 
sign-up, may submit a written, signed, request for a continuance 
referendum. Such request must be accompanied by a copy of the U.S. 
Customs form 7501 showing payment of a cotton assessment for calendar 
year 2001. Requests and supporting documentation must be mailed to 
USDA, FSA, ORAS, Attention: Phil Brockman, PO Box 23278, Washington, DC 
20026-3278.
    The sign-up period will be from June 3, 2002 through August 30, 
2002. Producer and importer forms shall only be counted if received by 
USDA during the stated sign-up period.
    Section 8(c)2 of the Act provides that if USDA determines, based on 
the results of the sign-up, that 10 percent or more of the total number 
of eligible producers and importers that voted in the most recent 1991 
referendum (i.e., 4,622) request a continuance referendum on the 1991 
amendments, a referendum will be held within 12 months after the end of 
the sign-up period. In counting such requests, however, not more than 
20 percent may be from producers from any one state or from importers 
of cotton. For example, when counting the requests, the AMS Cotton 
Program would determine the total number of valid requests from all 
cotton-producing states and from importers. Not more than 20 percent of 
the total requests will be counted from any one state or from importers 
toward reaching the 10 percent for 4,622 total signatures required to 
call for a referendum. If USDA determines that 10 percent or more of 
the number of producers and importers who voted in the most recent 
referendum favor a continuance referendum, a referendum will be held.
    This rule amends the procedures for the conduct of the current 
sign-up period. The current rules and regulations provide for sections 
on definitions, supervision of the sign-up period, eligibility, 
participation in the sign-up period, counting requests, reporting 
results and instructions and forms. The Administrator designated all 
divisions in AMS as programs on September 18, 1997. Hence, this rule 
has name, position title, address changes as well as other 
miscellaneous changes.
    The term Cotton Division is changed to Cotton Program. The term 
Director is replaced by Deputy Administrator. In Sec. 1205.18 the term 
Producer is further defined to ensure that all producers that planted 
cotton during 2001 will be eligible to participate in the sign-up 
period. In Secs. 1205.12 and 1205.26 the words de minimis assessment 
have been replaced with similar meaning language. In Secs. 1205.20, 
1205.26, and 1205.27 calendar year 1995 would change to calendar year 
2001. In Sec. 1205.26 the term limited partnership has been added. In 
Secs. 1205.27, 1205.28, and 1205.29 sign-up period conduct dates, FSA 
reporting dates, and mailing addresses have been updated. In 
Sec. 1205.26 a new subsection (g) is added to prohibit proxy or power 
of attorney participation. Section 1205.27 (c) that addresses producer 
participation in the sign-up period, is revised to reflect current Farm 
Service Agency procedures.
    A proposed rule with a request for comments was published in the 
Federal Register on March 18, 2002 (67 FR 11947). Two comments were 
received in response to the proposal. The first

[[Page 21169]]

comment was from a trade association that represents importers. The 
commenter requested that USDA take steps to ensure that the notice of 
sign-up be received by the appropriate person for each importer, and 
that each importer know what the cotton assessment is and how much it 
paid.
    USDA is not making any changes in response to this comment. USDA 
will mail a notice of sign-up to each importer that appears on the 
records of the United States Customs Service as having paid an 
assessment on cotton and products containing cotton at the time of 
import. Such records do not reflect a person's name within an importer 
organization that has been assigned duties associated with the Cotton 
Research and Promotion Act (Act). It is the responsibility of each 
importer to ensure that the notice of sign-up is routed to the person 
within the organization who has been assigned such duties. Moreover, it 
is also the responsibility of each importer to know what the cotton 
assessment is and how much it paid at the time of import. USDA will 
include a cover letter with each notice of sign-up it mails to 
importers. The letter will advise each importer of the opportunity to 
request a referendum on continuation of the 1990 amendments to the Act, 
enumerate what the amendments are, advise each importer where the 
enclosed form to request a referendum should be mailed, and the date by 
which USDA must receive the form in order for it to be counted.
    The second comment was received by USDA's Farm Service Agency 
(FSA). FSA will be conducting the sign-up process for USDA. It 
requested minor changes in order to help facilitate the sign-up 
process, and correct inaccurate references to FSA officials.
    Accordingly, the following changes are being made in this final 
rule. The reporting dates in paragraph (c) of Sec. 1205.29 for state 
FSA offices and ORAS are amended to allow sufficient time for each 
office to report the results of the sign-up. Specifically, the 
reporting date for state FSA offices is changed from September 10, 2002 
to September 17, 2002. The reporting date for ORAS is changed from 
September 17, 2002 to September 24, 2002. We also are amending the 
references in the supplementary information and regulatory text to FSA 
official William A. Brown. In Sec. 1205.27(b) FSA official Phil 
Brockman will be substituted for Mr. Brown. Section 1205.28 incorrectly 
referred an FSA ORAS official as the Deputy Administrator. We are 
amending this section by replacing Deputy Administrator with Director. 
Finally, the supplementary information stated that producers could 
request a sign-up form by mail in lieu of personally appearing at their 
county FSA office. In the interest of clarity, producers may also 
request a sign-up form in any other manner.
    Pursuant to 5 U.S.C. 533, it is found that good cause exists for 
not postponing the effective date of this rule until thirty-days after 
publication in the Federal Register because: (1) The Department has 
determined that June 3 through August 30, 2002, are the preferable 
dates of the sign-up period; (2) is consistent with the intent of the 
Act; (3) interested persons have been provided an opportunity to submit 
written comments concerning the amendments to the sign-up procedures; 
and (4) the amendments merely update various dates, name changes, 
addresses and make other miscellaneous. Eligibility and participation 
requirements are substantially the same that were used in previous 
referenda and a sign-up period.
    This rule amends the subpart to established procedures for use 
during the sign-up period, and these procedures will be in effect only 
for the duration of the sign-up period. Accordingly, this rule is 
adopted as final with the following changes.

List of Subjects in 7 CFR Part 1205

    Advertising, Agricultural research, Cotton, Marketing agreements, 
Reporting and recordkeeping requirements.

    For the reasons set forth in the preamble, 7 CFR Part 1205 is 
amended as follows:

PART 1205--COTTON RESEARCH AND PROMOTION

    1. The authority citation for part 1205 continues to read as 
follows:

    Authority: 7 U.S.C. 2101-2118.


    2. In Sec. 1205.12, the last sentence is revised to read as 
follows:


Sec. 1205.12  Cotton.

    * * * The term cotton does not include imported cotton for which 
the assessment is less than the value of $2.00 per line item entry as 
established by regulations.

    3. Section 1205.18 is revised to read as follows:


Sec. 1205.18  Producer.

    The term producer means any person who shares in a cotton crop, or 
in the proceeds thereof, as an owner of the farm, cash tenant, landlord 
of a share tenant, share tenant, or sharecropper, that planted the 
cotton during the representative period.

    4. Section 1205.20 is revised to read as follows:


Sec. 1205.20  Representative period.

    The term representative period means the 2001 calendar year.

    5. In Sec. 1205.26, paragraphs (a)(1), (a)(2), and (d) are revised 
and a new paragraph (g) is added to read as follows:


Sec. 1205.26  Eligibility.

* * * * *
    (a) * * *
    (1) Any person who was engaged in the production of Upland cotton 
during calendar year 2001; and
    (2) Any person who was an importer of Upland cotton and imported 
Upland cotton in excess of the value of $2.00 per line item entry 
during calendar year 2001.
* * * * *
    (d) An officer or authorized representative of a qualified 
corporation, association, or limited partnership may submit a request 
on behalf of that corporation, association, or limited partnership.
* * * * *
    (g) Participation in the sign-up by proxy or power of attorney is 
not authorized.

    6. Section 1205.27 is revised to read as follows:


Sec. 1205.27  Participation in the sign-up period.

    The sign-up period will be from June 3, 2002, through August 30, 
2002. Those persons who favor the conduct of a continuance referendum 
and who wish to request that USDA conduct such a referendum may do so 
by submitting such request in accordance with this section. All 
requests must be received by the appropriate USDA office by August 30, 
2002.
    (a) Before the sign-up period begins, FSA shall establish a list of 
known, eligible, Upland cotton producers in the county that it serves 
during the representative period, and shall also establish a list of 
known, eligible Upland cotton importers.
    (b) Before the start of the sign-up period, USDA shall mail a 
request form to each known, eligible, cotton importer. Importers who 
wish to request a referendum and who do not receive a request form in 
the mail by June 3, 2002, may participate in the sign-up period by 
submitting a signed, written request for a continuance referendum, 
along with a copy of a U.S. Customs form 7501 showing payment of a 
cotton assessment for calendar year 2001. Importers must

[[Page 21170]]

submit their requests and supporting documents to USDA, FSA, ORAS, 
Attention: Phil Brockman, PO Box 23278, Washington, DC 20026-3278. All 
requests and supporting documents must be received by the appropriate 
FSA office by August 30, 2002.
    (c) Each person on the county FSA office lists may participate in 
the sign-up period. Eligible producers must date and sign their name on 
the ``County FSA Office Sign-up Sheet.'' A person whose name does not 
appear on the county FSA office list may participate in the sign-up 
period. Such person must be identified on FSA-578 during the 
representative period or provide documentation that demonstrates that 
the person was a cotton producer during the representative period. 
Cotton producers not listed on the FSA-578 shall submit at least one 
sales receipt for cotton they planted during the representative period. 
Cotton producers must make requests to the county FSA office where the 
producer's farm is located. If the producer's land is in more than one 
county, the producer shall make request at the county office where FSA 
administratively maintains and processes the producer's farm records. 
It is the responsibility of the person to provide the information 
needed by the county FSA office to determine eligibility. It is not the 
responsibility of the county FSA office to obtain this information. If 
any person whose name does not appear on the county FSA office list 
fails to provide at least one sales receipt for the cotton they 
produced during the representative period, the county FSA office shall 
determine that such person is ineligible to participate in the sign-up 
period, and shall note ineligible in the remarks section next to the 
person's name on the county FSA office sign-up sheet. In lieu of 
personally appearing at a county FSA office, eligible producers may 
request a sign-up form from the county FSA office where the producer's 
farm is located. If the producer's land is in more than one county, the 
producer shall make the request for the sign-up form at the county 
office where FSA administratively maintains and processes the 
producer's farm records. Such request must be accompanied by a copy of 
at least one sales receipt for cotton they produced during the 
representative period. The appropriate FSA office must receive all 
completed forms and supporting documentation by August 30, 2002.

    7. In Sec. 1205.28, the first sentence is revised to read as 
follows:


Sec. 1205.28  Counting.

    County FSA offices and FSA, Director for Operations Review and 
Analysis Staff (ORAS), shall begin counting requests no later than 
September 3, 2002. * * *

    8. Section 1205.29 is revised to read as follows:


Sec. 1205.29  Reporting results.

    (a) Each county FSA office shall prepare and transmit to the state 
FSA office, by September 10, 2002, a written report of the number of 
eligible producers who requested the conduct of a referendum, and the 
number of ineligible persons who made requests.
    (b) ORAS shall prepare, by September 10, 2002, a written report of 
the number of eligible importers who requested the conduct of a 
referendum, and the number of ineligible persons who made requests.
    (c) Each state FSA office shall, by September 17, 2002, forward all 
county reports to ORAS. By September 24, 2002, ORAS shall forward its 
report of the total number of eligible producers and importers that 
requested a continuance referendum, through the sign-up period, to the 
Deputy Administrator, Cotton Program, AMS, Stop 0224, 1400 Independence 
Ave., SW, Washington, DC 20250-0224.
    (d) The Chief of the Research and Promotion Staff, Cotton Program, 
shall prepare a report of the requests received, including the number 
of eligible persons who requested the conduct of a referendum, and the 
number of ineligible persons who made requests, to the Deputy 
Administrator of the Cotton Program, and shall maintain one copy of the 
report where it will be available for public inspection for a period of 
5 years following the end of the sign-up period.
    (e) The Deputy Administrator of the Cotton Program shall prepare 
and submit to the Secretary a report of the results of the sign-up 
period. The Secretary will conduct a referendum if requested by 10 
percent or more of the number of cotton producers and importers voting 
in the most recent (July 1991) referendum, but not more than 20 percent 
of the total requests counted toward the 10 percent figure may be from 
producers in any one state or from importers of cotton. The Secretary 
shall announce the results of the sign-up period in a separate notice 
in the Federal Register.

    Dated: April 25, 2002.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 02-10676 Filed 4-26-02; 11:17 am]
BILLING CODE 3410-02-P