[Federal Register Volume 67, Number 197 (Thursday, October 10, 2002)] [Notices] [Pages 63070-63073] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 02-25841] ======================================================================== Notices Federal Register ________________________________________________________________________ This section of the FEDERAL REGISTER contains documents other than rules or proposed rules that are applicable to the public. Notices of hearings and investigations, committee meetings, agency decisions and rulings, delegations of authority, filing of petitions and applications and agency statements of organization and functions are examples of documents appearing in this section. ======================================================================== Federal Register / Vol. 67, No. 197 / Thursday, October 10, 2002 / Notices [[Page 63070]] DEPARTMENT OF AGRICULTURE Farm Service Agency Notice of Funds Availability; 2002 Livestock Compensation Program AGENCY: Farm Service Agency, USDA. ACTION: Notice. ----------------------------------------------------------------------- SUMMARY: This Notice announces the availability of $752 million under section 32 of the Act of August 24, 1935 (section 32) to implement the 2002 Livestock Compensation Program (LCP). Livestock feed supplies and grazing availability have been significantly reduced due to the extreme drought that has occurred throughout much of the United States during 2001 and 2002. The LCP was created by the United States Department of Agriculture (USDA) to provide immediate financial assistance to the producers of eligible beef, dairy, buffalo, beefalo, sheep or goats, or cash lessees of eligible livestock, in certain States and counties to offset losses due to drought. Funds will be provided to eligible applicants in counties declared under a disaster designation made after January 1, 2001, or submitted to the Secretary of Agriculture, by the Governor of a State or a Tribal Leader of an Indian Reservation, no later than September 19, 2002. The county must be approved by the Secretary to be eligible for the LCP. Complete eligibility criteria and application procedures are provided in the notice below. The Farm Service Agency (FSA) will determine eligible producers and the amount of assistance that will be paid. DATES: FSA began accepting applications on October 1, 2002. The application deadline will be determined by the Deputy Administrator for Farm Programs of FSA. Payments will be issued to applicants meeting all eligibility requirements beginning October 7, 2002. FOR FURTHER INFORMATION CONTACT: Lynn Tjeerdsma, Chief, Emergency Preparedness and Programs Branch, USDA/FSA, 1400 Independence Ave. SW, STOP 0517, Washington, D.C. 20250-0522; telephone (202) 720-7641; facsimile (202) 690-3610; electronic mail: Lynn-- [email protected]. Persons with disabilities who require alternative means for communication of regulatory information (braille, large print, audiotape, etc.) should contact USDA's TARGET Center at (202) 720-2600 (voice and TDD). SUPPLEMENTARY INFORMATION: Executive Order 12372 This program is not subject to the provisions of Executive Order 12372, which requires consultation with State and local officials. Environmental Compliance Due to the drought-related emergency requiring the Agency to provide immediate relief, sufficient time was not available to complete an environmental review prior to implementing the proposed action. Therefore, an environmental assessment is being completed to consider the potential impacts of this proposed action on the human environment in accordance with the provisions of the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321 et seq., the regulations of the Council on Environmental Quality (40 CFR Parts 1500-1508), and FSA's regulations for compliance with NEPA, 7 CFR part 799. A copy of the draft environmental assessment will be made available for public review and comment upon request. Paperwork Reduction Act A request for emergency clearance of the information collections associated with this notice has been approved by the Office of Management and Budget (OMB) under 5 CFR 1320.13(a)(2)(iii), and been assigned OMB control number 0560-0223. I. Definitions The following definitions are applicable to the 2002 Livestock Compensation Program: Adult beef cows are female bovine livestock, of a breed used for the purpose of providing meat for human consumption, that have delivered one or more offspring, at any time before June 1, 2002. Adult beef bulls are male bovine livestock, of a breed used for the purpose of providing meat for human consumption, to be used for breeding purposes, that were two years old on or before June 1, 2002. Adult buffalo and beefalo cows are female livestock of those breeds, used for the purpose of providing meat for human consumption, that have delivered one or more offspring, at any time before June 1, 2002. Adult buffalo and beefalo bulls are male livestock of those breeds, used for the purpose of providing meat for human consumption, to be used for breeding purposes that were two years old on or before June 1, 2002. Adult dairy bulls are male bovine livestock that are two years old on or before June 1, 2002, of a breed used for producing milk for human consumption, for breeding dairy cows. Adult dairy cows are female bovine livestock, used for the purpose of providing milk for human consumption, that have delivered one or more offspring, at any time before June 1, 2002. Agency is the Farm Service Agency, its employees, and any successor agency. Applicant is the individual or business entity applying for assistance. Application means the Form FSA-553, Livestock Compensation Program (LCP) Application. The FSA-553 is available at FSA county service centers and on the Internet. Beef bulls are male bovine livestock, used for the purpose of providing meat for human consumption, that as of June 1, 2002, weighed more than 500 pounds and were less than two years old. Beef replacement heifers and non-breeding heifers are female bovine livestock, used for the purpose of providing meat for human consumption, that as of June 1, 2002, weighed more than 500 pounds and had never delivered any offspring. Beef steers are neutered male bovine livestock, used for the purpose of providing meat for human consumption, that weighed more than 500 pounds on or before June 1, 2002. Buffalo and beefalo bulls are male livestock of those breeds, used for the purpose of providing meat for human consumption, that as of June 1, 2002, [[Page 63071]] that weighed more than 500 pounds and were less than two years old. Buffalo and beefalo replacement heifers and buffalo and beefalo non-breeding heifers are female livestock of those breeds, used for the purpose of providing meat for human consumption, that as of June 1, 2002, weighed more than 500 pounds and had never delivered any offspring. Buffalo and beefalo steers are neutered male livestock of those breeds, used for the purpose of providing meat for human consumption, that weighed more than 500 pounds on or before June 1, 2002. Business Entity is a corporation, partnership, joint operation, trust, limited liability company, or cooperative. Dairy bulls are male bovine livestock, of a breed used for the purpose of providing milk for human consumption, that as of June 1, 2002, weighed more than 500 pounds and were less than two years old. Dairy replacement heifers and dairy non-breeding heifers are female bovine livestock, of a breed used for the purpose of providing milk for human consumption, that as of June 1, 2002, weighed more than 500 pounds and had never delivered any offspring. Dairy steers are neutered male bovine livestock, of a breed used for the purpose of providing milk for human consumption, that weighed more than 500 pounds on or before June 1, 2002. Deputy Administrator or DAFP means the Deputy Administrator for Farm Programs, Farm Service Agency (FSA), or a designee. Eligible County is a county that was named as a primary county under a Secretarial disaster designation after January 1, 2001, for damages and losses due to drought; or for which a Governor of a State or a Tribal Leader of an Indian Reservation, requested a disaster designation no later than September 19, 2002, for damages and losses due to drought, and was subsequently approved by the Secretary as a primary county. Eligible livestock are certain beef and dairy cattle, buffalo and beefalo, sheep, and goats that an eligible livestock producer owned, or cash-leased for 90 or more days, and that were owned or subject to a cash lease on June 1, 2002. Certain beef and dairy cattle, buffalo and beefalo, sheep, and goats, subject to a contract for purchase by the applicant, that was negotiated prior to June 1, 2002, are eligible livestock. Eligible livestock producer is an owner or lessee of eligible livestock whose livestock operation headquarters is physically located in an eligible county. Goats are domesticated, bearded, horned, ruminant mammals of the genus Capra, including Angora goats. Ineligible livestock are any beef cattle, buffalo, beefalo, dairy cattle, sheep and goats that on June 1, 2002, were not owned or subject to a cash lease or under contract to be purchased by an applicant; and are any beef cattle, buffalo, and dairy cattle that, as of June 1, 2002, weighed less than 500 pounds; and also include livestock owned by an ineligible livestock producer. Ineligible livestock producer is a livestock owner that slaughters, processes, and packs livestock meat into meat and meat products; and, as determined by the Deputy Administrator, is also a livestock owner that, for monetary reimbursement or other gain, provides feed and facilities for livestock owned by another person on a custom feeding basis; and is also a livestock owner whose livestock operation headquarters is not located in an eligible county. Sheep are domesticated, horned, ruminant mammals of the genus Ovis, bred for their wool, edible flesh, or skin. II. Appeals An applicant may request an appeal or review of an adverse decision made by the Agency in accordance with 7 CFR parts 11 and 780, or its successor regulation. III. Eligibility Requirements Applicants must meet all of the following requirements to be eligible for the 2002 Livestock Compensation Program: 1. Timely application. The applicant must submit a signed form FSA- 553 completed to the best of the applicant's ability to the Agency, no earlier than October 1, 2002, and no later than such date as announced by the Deputy Administrator. 2. Livestock owner or lessee. The applicant must own, be subject to a contract to purchase, or cash-lease, eligible livestock. 3. Applicant's operation must be physically located in an eligible county. The applicant's livestock operation headquarters must be physically located in an eligible county on June 1, 2002. IV. Gross Revenue Limitation A person, as defined in 7 CFR part 1400, who has annual gross revenue in excess of $2.5 million shall not be eligible to receive assistance under the 2002 Livestock Compensation Program. 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. V. Payment Limitation The total amount of benefits that a person, as determined in accordance with 7 CFR part 1400, shall be entitled to receive under the 2002 Livestock Compensation Program may not exceed $40,000. VI. Determining the Amount of Assistance (a) Analysis of need. The $752 million targeted for the 2002 Livestock Compensation Program is the amount of net income losses related to livestock production in 2001 and 2002 due to drought conditions. The analysis was conducted by USDA's Economic Research Service (ERS). The analysis utilized various models and survey data from several different sources, and followed procedures used to develop USDA's regular farm income forecasts. The drought-affected areas were identified from the U.S. Drought Monitor (a comprehensive monitoring effort of USDA, National Oceanic and Atmospheric Administration, National Climate Control, and the National Drought Mitigation Center) that classifies climate regions by severity of drought conditions. Impacts were examined for livestock producers in areas delineated by severity as moderate, severe, extreme and exceptional drought areas. The ERS analysis considered the effect of drought both on revenue and on operating costs to obtain the net income effect related to livestock production in 2001 and 2002. (b) Revenue losses. Livestock producers in the drought areas lost $103 million in gross receipts in 2001 and $583 million in 2002. Several factors help to explain the level of these revenue losses: (1) The production impacts modeled in the analysis are associated with heat stress and water availability. In areas with exceptional drought, animal deaths due to heat and greater potential for disease contribute to lost production and revenue. (2) The analysis does not measure the effect on receipts from early sale of cattle or herd liquidations. The significant decline in livestock prices since last year are not attributed to [[Page 63072]] drought, but do affect the amount of reduction in potential receipts. (c) Additional Expenses. In many cases, the response to drought conditions by livestock producers involves changes in production practices that create additional and often unanticipated costs to their business. An example would be extra expenses for utilities such as electricity and for water. Such short-run increases in the cost of doing business were examined and their effect on total production expenses ranged from five percent in exceptional drought areas to less than one percent in moderate drought areas. Across all drought areas, total additional expenses were estimated to be $51 million in 2001 and $415 million in 2002. (d) Net Impacts. The net impact on income was the combination of revenue losses plus additional costs incurred and deduction of government assistance that already has been provided in 2002 through the FSA Noninsured Assistance Program (NAP) and the 2002 Cattle Feed Program (See Notice of Funds Availability published September 3, 2002 (67 FR 56260). Payments for NAP in 2002 are expected to total $250 million, and USDA made $150 million available for the 2002 Cattle Feed Program. The net impact of the drought for 2001 and 2002 was $154 million and $598 million, respectively, for a total two-year impact of just over $750 million. (e) Payment Rates. Payment rates were calculated based on standard feed relationships among the eligible animal types and then indexed against beef cattle.For a beef cow, the feed requirement used for previous FSA-administered feed assistance programs, such as the Livestock Assistance Program at 7 CFR part 1439 and the 2002 Cattle Feed Program described in the September 3, 2002 Notice of Funds Availability, is converted to a corn equivalent of 15.7 pounds of corn per day. Using an Olympic five-year average (average of five years with the highest and lowest values excluded) of 1995-2000 corn prices, the national average price for corn is calculated at $2.07 per bushel or $0.037 per pound. The support feeding rate of 15.7 pounds of corn multiplied by $0.037 per pound of corn required per day to support a beef cow is equivalent to $0.58 per day to feed a beef cow. The subsistence level of $0.58 per day divided into the $18.00 payment for an eligible beef cow results in an approximate 30-day period that the 2002 Livestock Compensation Program will provide funds to purchase feed for a beef cow. A feed relationship factor of 2.6 was used for dairy because dairy cows typically consume 2.6 times the amount of feed consumed by a beef cow. This factor assumes enough feed for dairy cows to continue normal and even increasing levels of milk production. The payment rate in this program is based on a 1.75 feed relationship factor for dairy. This lower factor was deemed appropriate because of the significant payments dairy producers will receive beginning in October, 2002 under the new Milk Income Loss Contract program. It also remains high enough to ensure continued milk production by eligible dairy cows. VII. Applicant Certification of Eligible Livestock Eligible livestock must be certified by owner or lessee on the FSA- 553. The applicant will report to FSA and provide proof of the number of eligible livestock that died or were sold after June 1, 2002. VIII. Payment Eligibility To be eligible for payment under the 2002 Livestock Compensation Program, as determined by the Deputy Administrator, the applicant shall, as of June 1, 2002, be an owner, lessee, or under contract to purchase eligible livestock, whose livestock headquarters operation is physically located in an eligible county; who has submitted and subsequently received FSA County Committee approval on FSA-553, and who meets all other eligibility requirements. IX. Payment Amounts Adult beef cows and bulls, and adult buffalo and beefalo cows and bulls, as defined in Part I: $18.00 per head. Adult dairy cows and bulls, as defined in Part I: $31.50 per head. Beef, dairy, buffalo and beefalo replacement heifers, steers, non- breeding heifers, and bulls, as defined in Part I: $13.50 per head. All sheep and goats, as defined in Part I, born prior to June 1, 2002: $4.50 per head. X. Contract Liability All producers receiving a share of the LCP payment are jointly and severally liable for program violations and resulting repayments, if applicable. XI. How the 2002 LCP Will Work Applications were accepted in FSA county offices beginning on October 1, 2002. On the LCP application, all owners of livestock in each livestock operation in an eligible county apply for payment on one application. Each applicant provides FSA with, and certifies to, the applicant's name and Tax Identification Number number, address, and number and type of eligible livestock. After FSA County Committee approval of the LCP application, payments will be issued beginning October 7, 2002, from the FSA county office to each approved livestock producer on the application. XII. Misrepresentation, Scheme or Device A person shall be ineligible to receive assistance under this part, and be subject to such other remedies as may be allowed by law, if, with respect to such program, it is determined by the FSA State or county committee, or an official of FSA, that such person has: (a) Adopted any scheme or other device that tends to defeat the purpose of the program operated under this Notice; (b) Made any fraudulent representation with respect to this program; or (c) Misrepresented any fact affecting a program determination. XIII. Liens and Claims of Creditors Any benefit or portion thereof due any person under this program shall be allowed without regard to questions of title under State law, and without regard to any claim or lien in favor of any person, except agencies of the U.S. Government. XIV. Power of Attorney In those instances in which, prior to the issuance of this Notice, 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 programs listed on the form, without limitation, such power will be considered to extend to this program unless by October 1, 2002, the person granting the power notified 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. XV. Administration Where circumstances preclude compliance due to circumstances beyond the applicant's control, the county or State committee may request that relief be granted by the Deputy Administrator under this Notice. In such cases, except for statutory deadlines and other statutory requirements, the Deputy Administrator may, in order to more equitably accomplish the goals of this Notice, waive or modify deadlines and other program requirements if the failure to meet such deadlines or other [[Page 63073]] requirements does not adversely affect operation of the program and are not prohibited by statute. The Section 32 funds allocated to FSA to provide assistance under this program will be monitored by careful review of regular and daily reports of all payments issued under the program. Upon expenditure of 85 percent of the designated allocation, FSA will mandate a daily review of expenditures to ensure that payments do not exceed the allocation. Signed at Washington, DC, on October 7, 2002. James R Little, Administrator, Farm Service Agency. [FR Doc. 02-25841 Filed 10-7-02; 3:59 pm] BILLING CODE 3410-05-P