[Federal Register Volume 68, Number 22 (Monday, February 3, 2003)]
[Rules and Regulations]
[Pages 5205-5208]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-2359]



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 Rules and Regulations
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  Federal Register / Vol. 68, No. 22 / Monday, February 3, 2003 / Rules 
and Regulations  

[[Page 5205]]



DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

7 CFR Part 1413

RIN 0560-AG71


Hard White Wheat Incentive Program

AGENCY: Commodity Credit Corporation, USDA.

ACTION: Final rule.

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SUMMARY: This rule implements the Hard White Wheat Incentive Program 
(HWWIP). This program provides incentive payments to eligible hard 
white wheat producers in the amount of $0.20 per bushel, with a maximum 
of 60 bushels of hard white wheat production eligible for payment on 
each acre planted. Planting certified hard white wheat seed is not an 
eligibility requirement to receive payment under HWWIP; however, an 
additional incentive payment in the amount of $2.00 per acre is 
provided to hard white wheat producers who plant certified hard white 
wheat seed for any of the 2003 through 2005 crops of hard white wheat. 
The purpose of the program is to increase the production of both spring 
and winter varieties of hard white wheat during the 2003 through 2005 
crop years.

DATES: Effective January 29, 2003.

FOR FURTHER INFORMATION CONTACT: Helen Smith, Production, Emergencies, 
and Compliance Division, FSA/USDA, Stop 0517, 1400 Independence Ave., 
SW., Washington, DC 20250-0512; telephone (202) 720-7641; facsimile 
(202) 690-3610; e-mail: [email protected]. Persons with disabilities 
who require alternative means for communication (Braille, large print, 
audio tape, etc.) should contact the USDA Target Center at (202) 720-
2600 (voice and TDD).

SUPPLEMENTARY INFORMATION:

Notice and Comment

    Section 1601(c) of the Farm Security and Rural Investment Act of 
2002 (Pub. L. 107-171) requires that the regulations necessary to 
implement these provisions be promulgated without regard to the notice 
and comment provisions of 5 U.S.C. 553 or the Statement of Policy of 
the Secretary of Agriculture (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.

Executive Order 12866

    This rule is issued in conformance with Executive Order 12866 and 
has been determined to be significant and has been reviewed by the 
Office of Management and Budget. A cost-benefit assessment was 
completed and is summarized after the background section.

Federal Assistance Programs

    The titles and numbers of the Federal assistance programs, as found 
in the Catalog of Federal Domestic Assistance, to which this final rule 
applies are: Commodity Loans and Loan Deficiency Payments, 10.051.

Regulatory Flexibility Act

    It has been determined that the Regulatory Flexibility Act is not 
applicable to this rule because the Commodity Credit Corporation (CCC) 
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.
    Commodity Loans and Loan Deficiency Payments, 10.051.

Environmental Evaluation

    The environmental impacts of this final rule have been considered 
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 the FSA 
regulations for compliance with NEPA, 7 CFR parts 799, and 1940, 
subpart G. FSA completed an environmental evaluation and concluded the 
rule requires no further environmental review. No extraordinary 
circumstances or other unforeseeable factors exist which would require 
preparation of an environmental assessment or environmental impact 
statement. A copy of the environmental evaluation is available for 
inspection and review upon request.

Executive Order 12988

    This final rule has been reviewed in accordance with Executive 
Order 12988. The provisions of this final rule preempts State laws to 
the extent such laws are inconsistent with the provisions of this rule. 
Before any judicial action may be brought concerning provisions of this 
rule, administrative remedies must be exhausted.

Executive Order 12372

    This program is not subject to the provisions of Executive Order 
12372, which requires intergovernmental consultation with State and 
local officials. See the notice related to 7 CFR part 3015, subpart V, 
published at 48 FR 29115 (June 24, 1983).

Unfunded Mandates Reform Act of 1995

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

Small Business Regulatory Enforcement Fairness Act of 1996

    Section 1601(c) requires that authority in section 808 of the Small 
Business Regulatory Enforcement Fairness Act of 1996, (SBREFA), be used 
which allows an agency to forgo SBREFA's usual 60-day Congressional 
Review delay of the effective date of a major regulation if the agency 
finds that there is a good cause to do so. Accordingly, this rule is 
effective upon the date of filing for public inspection by the Office 
of the Federal Register.

Paperwork Reduction Act

    Section 1601(c) of the 2002 Act provides that the promulgation of 
regulations and the administration of Title I of the 2002 Act shall be 
made without regard to chapter 5 of title 44 of the United States Code 
(the Paperwork Reduction Act). Accordingly, these regulations and the 
information collection activities needed to

[[Page 5206]]

administer the program authorized by these regulations, are not subject 
to review by the Office of Management and Budget under the Paper 
Reduction Act.

Government Paperwork Elimination Act

    The Farm Service Agency (FSA) is committed to compliance with the 
Government Paperwork Elimination Act (GPEA) and the Freedom to E-File 
Act, which require Government agencies in general and FSA in particular 
to provide the public the option of submitting information or 
transacting business electronically to the maximum extent possible. The 
forms and other information collection activities required by 
participation in the Hard White Wheat Incentive Payment Program are not 
yet fully implemented for the public to conduct business with FSA 
electronically.
    Applications for all programs may be submitted at the FSA county 
offices by mail or fax. At this time, electronic submission is not 
available. Full implementation of electronic submission is underway.

Executive Order 12612

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

Background

    Section 1616 of the Farm Security and Rural Investment Act of 2002, 
(the 2002 Act), provides that a total of $20,000,000 of CCC funds be 
used during the 2003 through 2005 crop years, to provide incentive 
payments to producers of hard white wheat. The 2002 Act also mandates 
that this program shall be implemented on not more than 2,000,000 acres 
or equivalent volume of production for the 2003 through the 2005 crop 
years. An equivalent volume of production has been determined to be 
120,000,000 bushels, which is the product of 2,000,000 acres times 60 
bushels per acre.
    In the event that the 2,000,000 acre limitation is reached under 
this program before the $20 million authorized for the program is 
distributed, the 120,000,000 million bushels shall become the cap for 
implementing the program.
    The purpose of this program is to create an incentive for producers 
to plant hard white wheat of winter and for spring varieties, which 
would subsequently increase production for both domestic and export 
markets. Payments under this program are available to producers in 
every State.
    The Hard White Wheat Incentive Program (HWWIP) will provide two 
payments to producers: An incentive payment of $0.20 for each bushel of 
eligible hard white wheat production, with a maximum of 60 bushels per 
acre eligible for payment, and (2) a payment of $2.00 per acre for 
certified seed. Producers do not have to plant certified seed to 
receive the production incentive payment.
    With respect to the first payment, the reason for the 60 bushel per 
acre cap is to provide consistent payments to producers in the various 
geographic regions of the United States that have disparate hard white 
wheat production capabilities. Two payment options were considered. 
One, a direct payment per acre of production; and two, a direct payment 
for each bushel of production. Traditionally, hard white wheat yields 
in the Northwest growing region are significantly higher than in the 
Plains States. Accordingly, a per acre payment is not an equitable 
solution, nor does a payment based on production, with no limitation on 
the production eligible for payment, provide equitable assistance. 
Therefore, it was determined that a $0.20 per bushel payment, with a 60 
bushel per acre cap, will most equitably distribute payments and 
address production disparities across the hard white wheat growing 
areas. Also, it was determined that a bushel-based payment system would 
likely result in the production of more bushels of hard white wheat 
than will an acre-based payment system because it will attract more 
productive land. This incentive payment will be issued only if hard 
white wheat is actually produced and after production is verified by 
means of a settlement sheet or other similar documentation delivered to 
CCC.
    In order to encourage purity and yield potential of the hard white 
wheat production, an additional incentive payment is provided in the 
amount of $2.00 per acre for each acre a producer plants to 2003 
through 2005 crops of hard white wheat with certified seed. Producers 
utilizing this option will be required to show proof that certified 
seed was planted on the reported acres. This additional payment is 
provided to help offset the added cost of the certified seed, and 
should increase the purity of the hard white wheat produced, decreasing 
the possibility that the seed used to plant the hard white wheat 
contains other types of wheat. This payment may be issued even if the 
crop subsequently fails and no hard white wheat production is realized 
from the acreage planted to the certified seed.
    Minimum quality standards have been determined to be U.S. 
2 Hard White Wheat or better, as established by Federal Grain 
Inspection Service. A settlement sheet or other similar documentation 
is required before incentive payments may be issued and must indicate 
at a minimum: That the wheat accounted for on the document is hard 
white wheat; the grade of the hard white wheat; name and address of 
person the hard wheat was purchased from; net bushels; and name and 
address of purchasing facility. The settlement sheet shall be subject 
to verification by CCC.

Cost Benefit Assessment Summary

Hard White Winter Wheat Incentive Payments

    Increased plantings of hard white wheat varieties are expected to 
be offset by lower plantings of other classes of wheat. Thus, the 
incentive payments will not measurably affect total wheat production. 
On the demand side, millers are likely to use hard white wheat for 
domestic food use at the expense of other wheat classes. The net impact 
on the estimated annual quantity of wheat used for food is negligible.
    Currently, U.S. hard white wheat exports are small, partly due to 
an inadequate supply of consistent quality. Target markets are 
predominantly in southeast Asia, where hard white wheat varieties are 
used to produce Chinese noodles. Incentives to grow hard white wheat 
should increase supplies of consistent quality so exporters can compete 
in this export market.
    Federal outlays are expected to increase by the amount of CCC funds 
that must be made available for the incentive payments, or $20 million. 
Timing of these payments depends on producer participation. About $6 
million will likely be expended for the 2003 crop, $12 million for the 
2004 crop, and the remaining $2 million for the 2005 crop. Because of 
the potential for hard white wheat payment requests to exceed available 
funds during the 2004 and 2005 crops, procedures will allow factoring 
of payment levels to avoid expending more than the $20 million provided 
by the law.
    For further information, contact: Phil Sronce at 202-720-2711, or 
[email protected].

List of Subjects in 7 CFR 1413

    Agricultural commodities, Feed grains, Grains.


[[Page 5207]]



    Accordingly, 7 CFR Chapter XIV is amended by adding part 1413 is 
set forth below.
    1. Part 1413 is added to read as follows:

PART 1413--HARD WHITE WHEAT INCENTIVE PROGRAM

Sec.
1413.101 Applicability.
1413.102 Administration.
1413.103 Definitions.
1413.104 Signup and application process.
1413.105 Eligibility.
1413.106 Quality.
1413.107 Availability of funds and maximum eligible acreage and 
production.
1413.108 Applicant's maximum payment quantity.
1413.109 Calculation of assistance.
1413.110 Offsets and withholdings.
1413.111 Assignments.
1413.112 Appeals.
1413.113 Other regulations

    Authority: 7 U.S.C. 7999; 15 U.S.C. 714b and 714c.


Sec.  1413.101  Applicability.

    (a) These regulations in this part set forth the terms and 
conditions of the Hard White Wheat Incentive Program. The Farm Security 
and Rural Investment Act of 2002 provides that $20,000,000 of the funds 
of CCC shall be available during the 2003 through the 2005 crop years 
for producers to produce and market hard white wheat limits this 
program to not more than a total of 2,000,000 acres or an equivalent 
volume of 120,000,000 bushels of production for the 2003 through 2005 
crop years.
    (b) A production payment incentive shall be available only for hard 
white winter wheat that grades U.S.  2 grade or higher, 
established by the Federal Grain Inspection Service, that is produced 
and harvested in the United States.
    (c) A certified seed incentive payment shall be available for each 
acre planted to certified hard white wheat seed, as approved by CCC. 
Producers are eligible to receive incentive payments for the production 
incentive or the certified seed incentive, or both. Each incentive 
payment is independent of the other.


Sec.  1413.102  Administration.

    (a) The program is administered under the general supervision of 
the Executive Vice-President, CCC, and shall be carried out by the Farm 
Service Agency (FSA) State and county committees (State and county 
committees).
    (b) State and county committees, their representatives and 
employees, have no authority to modify or waive any of the provisions 
of the regulations of this part, except as provided in paragraph (e) of 
this section.
    (c) The State committee shall take any action required by the 
regulations of this part that the county committee has not taken. The 
State committee shall also:
    (1) Correct, or require a county committee to correct any action 
taken by such county committee that is not in accordance with the 
regulations of this part; or
    (2) Require a county committee to withhold taking any action that 
is not in accordance with the regulations of this part.
    (d) No provision or delegation of this part to a State or county 
committee shall preclude the Executive Vice President, CCC, or a 
designee, from determining any question arising under the program or 
from reversing or modifying any determination made by the State or 
county committee.
    (e) The Deputy Administrator, Farm Programs, FSA, may authorize 
State and county committees to waive or modify deadlines and other 
program requirements in cases where lateness or failure to meet such 
other requirements do not adversely affect the operation of this 
program and does not violate statutory limitations on the program.
    (f) Any payment applications not executed in accordance with the 
terms and conditions determined and announced by CCC, including any 
purported execution prior to the dates authorized by the Executive Vice 
President, CCC, is null and void and shall not be considered to be a 
contract between CCC and any person executing the contract.


Sec.  1413.103  Definitions.

    The definitions set forth in this section shall be applicable for 
all purposes of administering the Hard White Wheat Incentive Program 
established by this part.
    Application period means the date established by the Deputy 
Administrator for producers of hard white wheat to apply for program 
benefits.
    CCC means the Commodity Credit Corporation.
    Certified seed means hard white wheat seed grown from acceptable 
seedstock and sold, according to rules imposed by a State's Certified 
Seed Board, as determined acceptable by the Deputy Administrator.
    County committee means the FSA county committee.
    County office means the FSA office.
    Department or USDA means the United States Department of 
Agriculture.
    Deputy Administrator means the Deputy Administrator for Farm 
Programs (DAFP), Farm Service Agency or a designee.
    Eligible bushels means hard white wheat bushels that were produced 
in the United States anytime during the 2003 through 2005 crop years, 
and for which an acceptable settlement sheet has been provided to the 
county committee.
    Farm Service Agency or FSA means the Farm Service Agency of the 
United States Department of Agriculture.
    Payment means the bushels of wheat or seed production for which an 
operation is eligible to be paid under this part.
    Settlement sheet means a document provided to a seller of hard 
white wheat upon delivery of hard white wheat to a CCC-approved 
warehouse, or other hard white wheat purchasing facility determined 
acceptable by CCC, with information which includes, but is not limited 
to: the name and address of buyer and seller; gross quantity; net 
quantity; price per bushel; and type and grade of the delivered hard 
white wheat.


Sec.  1413.104  Signup and application process.

    (a) Signup for the Hard White Wheat Incentive Program shall be 
conducted by CCC for each of the 2003 through 2005 crop years during 
the application period announced by the Deputy Administrator. 
Applications are available from any county FSA office. Applicants must 
submit a complete application to FSA during the application period.
    (b) The producer shall submit one application for all farms within 
in a particular county. On the application, the applicant must certify 
to: The total number and location of acres planted to hard white wheat 
and the number of eligible bushels sold. Applicants must also provide a 
settlement sheet, to FSA upon disposal of the production certified to 
on the application.
    (c) Each applicant for a certified seed incentive payment must 
submit an acceptable seed receipt for the certified seed to FSA, and 
certify to the number and location of acres planted with certified 
seed.
    (d) Producers requesting benefits under this part must certify to 
the accuracy and truthfulness of the information provided in their 
application. All information provided is subject to verification by 
FSA.


Sec.  1413.105  Eligibility.

    (a) The certified seed incentive payment and the production 
incentive payments are available to eligible producers under Sec.  
1413.101(b) and (c) for any or all of the years 2003 through

[[Page 5208]]

2005. Producers are eligible to receive both the certified seed and 
production incentive in the same year. Where an acre of land receives 
both the certified seed incentive and production incentive payment in 
the same year, only one acre shall be counted under the total 2,000,000 
acreage limitation of Sec.  1413.101(a).
    (b) To be eligible to receive the certified seed incentive payment, 
a producer must:
    (1) Submit a complete application during the application period.
    (2) Submit a receipt for the purchase of certified seed to FSA.
    (c) To be eligible to receive the production incentive payment, a 
producer must:
    (1) Submit a complete application during the application period.
    (1) Produce hard white wheat of the quality required under Sec.  
1413.106;
    (2) Have an interested buyer with the intent to use the wheat for 
all purposes except for feed use.


Sec.  1413.106  Quality.

    The hard white wheat must be grade 2 or higher under the 
grading standards, established by the Federal Grain Inspection Service 
(FGIS).


Sec.  1413.107  Availability of funds and maximum eligible acreage and 
production.

    The total available program funds for the 2003 through 2005 crop 
years is $20 million. To ensure that funds are available for each of 
the 2003 through 2005 crop years, payments may be factored based on 
total eligible producers for any year the eligible payments exceed the 
total funds available to be spent. The maximum hard white wheat acreage 
and production for which payments may be issued for the 2003 through 
2005 crop year is to total 2,000,000 acres, or 120,000 bushels, 
whichever is greater. The certified seed incentive may be discontinued, 
as determined by the Deputy Administrator, in any year sufficient funds 
are determined to be unavailable.


Sec.  1413.108  Applicant's maximum payment quantity.

    (a) The maximum payment quantity of hard white wheat for which an 
applicant may be approved under the production incentive payment for 
any year shall be the smaller of:
    (1) The actual number of bushels harvested from the acres certified 
on the application; or
    (2) The product of:
    (i) The number of acres certified on the application;
    (ii) Times 60 bushels per acre.
    (b) [Reserved]


Sec.  1413.109  Calculation of assistance.

    (a) Payment for the production incentive shall be the product of:
    (1) The bushels determined in accordance with Sec.  1413.108
    (2) Times $0.20.
    (b) Payment for the certified hard white wheat planting incentive 
shall be the product of:
    (1) The number of acres certified on the application;
    (2) Times $2.00 per acre.


Sec.  1413.110  Offsets and withholdings.

    CCC may offset or withhold payments approved under this part in 
accordance with part 1403 of this chapter.


Sec.  1413.111  Assignments.

    Persons entitled to a HWWIP payment may assign their rights to such 
payments in accordance with part 1404 of this chapter.


Sec.  1413.112  Appeals.

    Any producer who is dissatisfied with a determination made pursuant 
to this part may request reconsideration or appeal such determination 
in accordance with parts 11 and 780 of this title.


Sec.  1413.113  Other regulations.

    (a) The provisions of part 12 of this title, and the controlled 
substance provisions of part 718 of this title apply to payments made 
under this part.
    (b) The payment limitation provisions of part 1400 of this title 
shall not be applicable to payments made under this part.
    (c) The provisions of part 707 of this title relating to the making 
of payments in the event of the death of a program participant or and 
in the event of other special circumstances shall apply to payments 
made under this part.

    Signed in Washington, DC, on January 28, 2003.
James R. Little,
Executive Vice President, Commodity Credit Corporation.
[FR Doc. 03-2359 Filed 1-29-03; 11:56 am]
BILLING CODE 3410-05-P