[Federal Register Volume 69, Number 119 (Tuesday, June 22, 2004)]
[Proposed Rules]
[Pages 34615-34616]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-14063]


 ========================================================================
 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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 

  Federal Register / Vol. 69, No. 119 / Tuesday, June 22, 2004 / 
Proposed Rules  

[[Page 34615]]



DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

7 CFR Part 1464

RIN 0560-AH13


Tobacco Loan Program--Removal of Requirement That Producers of 
Burley and Flue Cured Tobacco Designate Sales Locations

AGENCY: Commodity Credit Corporation, USDA.

ACTION: Proposed rule.

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SUMMARY: The Commodity Credit Corporation (CCC) proposes to rescind the 
price support eligibility provision that requires flue-cured tobacco 
farmers to designate the auction warehouse(s) where they will sell 
their tobacco and burley tobacco farmers to designate all locations 
where they will sell their tobacco, both auction warehouse(s) and the 
central buying points, known as receiving stations, for non-auction 
sales. Currently price support loans for producers of those kinds of 
tobacco are available for eligible tobacco only at designated auction 
warehouses.

DATES: Submit comments about this proposed rule on or before July 22, 
2004, to be assured consideration. Comments received after that date 
will be considered to the extent practicable.

ADDRESSES: Interested persons are invited to submit comments on this 
proposed rule. Comments may be submitted by any of the following 
methods:
     E-mail: Send comments to [email protected].
     Fax: Submit comments by facsimile transmission to (202) 
720-9832.
     Mail: Send comments to Director, Tobacco Division (TD), 
Farm Service Agency, United States Department of Agriculture (USDA), 
STOP 0514, Room 5750-S, 1400 Independence Avenue, SW., Washington, DC 
20250-0514.
     Hand Delivery or Courier: Deliver comments to the above 
address.
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting 
comments.
    Comments may be inspected in the Office of the Director, TD, FSA, 
USDA, Room 5750-S, 1400 Independence Avenue, SW., Washington, DC, 
between 8 a.m. and 4:30 p.m., Monday through Friday, except holidays. 
Visitors are encouraged to call ahead at (202) 720-7413 to facilitate 
entry into the building. Individuals who use telecommunication devices 
for the deaf (TDD) may call the Federal Information Relay Service 
(FIRS) at 1-800-877-8339 between 8 a.m. and 8 p.m., eastern standard 
time, Monday through Friday.

FOR FURTHER INFORMATION CONTACT: Ann Wortham, (202) 720-2715 or [email protected].

SUPPLEMENTARY INFORMATION:

Background

    The tobacco quota and price support program is operated under 
provisions of the Agricultural Adjustment Act of 1938, as amended, and 
the Agricultural Act of 1949, as amended. Every three years, producers 
of burley and flue-cured tobacco vote in a referendum to determine 
whether or not an annual national marketing quota will be established 
for their kind of tobacco. An annual price support level is established 
for each kind of tobacco for which an annual marketing quota is 
established. Price support is available only on tobacco for which a 
national quota has been established. Current tobacco program 
regulations require that in order to receive a price support at an 
auction warehouse, producers who sell burley or flue-cured tobacco must 
specify ahead of time--designate--the warehouse(s) where they will sell 
their crop and how much they will sell at each location. AMS uses the 
designation records to help schedule personnel they need to conduct 
their tobacco-related activities at warehouses. The Farm Service Agency 
(FSA) processes producer designation requests and then provides the 
producer one or more marketing cards, each of which carries the code 
number of the warehouse(s) they have selected. Producers must present a 
properly coded marketing card when delivering their tobacco. Although 
most producers will sell their entire tobacco crop (or surrender it for 
a price support loan in the event there is not an adequate bid for the 
tobacco) at the auction warehouse that was their first choice, many 
decide later to sell some of their tobacco elsewhere. Current 
regulations outline the schedule by which such changes--
redesignations--may be made.
    Since 1998 individual farm quotas have been reduced 47% for burley 
and 58% for flue-cured. Until 3 years ago most of the burley and flue-
cured tobacco produced in the U.S. was sold in auction warehouses. Now, 
80 percent of the tobacco is sold at non-auction locations. The 
reduction in quotas and the corresponding decrease in warehouse sales 
have shortened the sale season for those warehouses that have managed 
to remain open. Keeping record of the movement of millions of pounds of 
tobacco as it is designated from one sale location to another is done 
on paper, by hand.
    Auction locations provide daily sales information collected on 
paper and mailed to the FSA, where the data is manually keyed into a 
database. Some auction warehouses have not made the technological 
improvements that will electronically transmit daily sales data. Non-
auction tobacco sales information, however, is transmitted 
electronically each sale day. This electronically transmitted sales 
data tells FSA within 24 hours not only how much of a farmer's tobacco 
was sold but where. Also, in the past AMS has used Agency designation 
information, and has worked with local trade boards and tobacco 
warehouse associations for scheduling tobacco activities in which they 
are involved.
    A designation is not effective for at least two weeks. A farmer can 
request a redesignation only during one week each month and then must 
wait an additional two weeks before the change is effective. Producers 
who need to redesignate may end up waiting as much as 6 weeks before 
they can sell their tobacco. During this time marketing options and 
choices may be curtailed. Designation information is no longer 
generally necessary for the Agency for purposes of recording where 
tobacco moves in the marketplace. And the benefits of such designations 
in any event have not proven to be as significant as anticipated. Also, 
changed marketing circumstances no longer appear to justify 
designations for flue-cured tobacco, which preceded those for burley 
when there was a concern about undermarketings to local warehouses.

[[Page 34616]]

Many of those warehouses no longer exist and may have been replaced by 
other marketing opportunities. Further, as in the past, it is expected 
that sufficient information will be available to allow the proper 
assignment of inspectors or that appropriate changes can be made to 
address that problem without the formal designation system of the 
current provisions of 7 CFR part 723, which, moreover, apply only to 
burley and flue-cured tobacco. We thus propose to rescind the 
requirement that calls for burley and flue-cured tobacco farmers to 
designate where they will sell their tobacco.

Executive Order 12372

    This proposed rule is not subject to the provisions of Executive 
Order 12372, which require 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 12866

    This rule has been determined to be not significant for the 
purposes of Executive Order 12866 and therefore was not reviewed by the 
Office of Management and Budget.

Regulatory Flexibility Act

    The Regulatory Flexibility Act is not applicable to this proposed 
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.

Unfunded Mandates

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

Federal Assistance Programs

    The title and number of the Federal Assistance Program, as found in 
the Catalog of Federal Domestic Assistance to which this rule applies, 
are: 10.051--Commodity Loans and Loan Deficiency Payments.

Environmental Evaluation

    FSA has determined that this action does not constitute a major 
Federal action significantly affecting the quality of the human 
environment and, consistent with the provisions of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.), neither an 
Environmental Impact Statement nor an environmental assessment is 
required.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
5501 et seq.), the information collection or recordkeeping requirements 
covered in this proposed rule approved by the Office of Management and 
Budget (OMB) under OMB control numbers 0560-0058 and 0560-0217. Because 
this action will reduce the information collected, a reduction in the 
approved burden estimate will be made.
    Accordingly, the Commodity Credit Corporation proposes to amend 7 
CFR part 1464 as follows:

PART 1464--TOBACCO

    1. The authority citation for 7 part CFR 1464 continues to read as 
follows:

    Authority: 7 U.S.C. 1421, 1423, 1441, 1445, 1445-1 and 1445-2; 
15 U.S.C. 714b, 714c.


Sec.  1464.2  [Amended]

    2. Amend Sec.  1464.2 by removing paragraph (b)(2) and 
redesignating paragraphs (b)(3), (b)(4) and (b)(5) as (b)(2), (b)(3) 
and (b)(4), respectively.

    Signed in Washington, DC on June 10, 2004.
James R. Little,
Executive Vice-President, Commodity Credit Corporation.
[FR Doc. 04-14063 Filed 6-21-04; 8:45 am]
BILLING CODE 3410-05-P