[Federal Register Volume 69, Number 246 (Thursday, December 23, 2004)]
[Rules and Regulations]
[Pages 76836-76839]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-28061]


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DEPARTMENT OF AGRICULTURE

Farm Service Agency

7 CFR Part 784

RIN 0560-AH15


2004 Ewe Lamb Replacement and Retention Payment Program

AGENCY: Farm Service Agency, USDA.

ACTION: Final rule.

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SUMMARY: This rule sets forth the regulations for the 2004 Ewe Lamb 
Replacement and Retention Payment Program. This program will assist 
producers of sheep and promote the replacement and retention of ewe 
lamb breeding stock by providing payments to producers who have 
recently reduced production and flock size due to low prices, and other 
market conditions.

DATES: This rule is effective on December 23, 2004.

FOR FURTHER INFORMATION CONTACT: Danielle Cooke, Price Support 
Division, Farm Service Agency, United States Department of Agriculture, 
STOP 0512, 1400 Independence Avenue, SW., Washington, DC 20250-0512. 
Telephone (202) 720-1919; email: [email protected].

SUPPLEMENTARY INFORMATION:

Discussion of Final Rule

    The ELRRPP provides direct payments to sheep producers in order to 
help the U.S. sheep industry achieve sustained competitiveness. A 
reduction in sheep producer income has experienced reduced production 
of sheep and lambs and flock size. The domestic sheep industry has 
experienced reduced market prices, production, flock size, and 
investment in improving sheep flocks. In addition, persistent drought 
conditions in major U.S. sheep-producing areas have reduced available 
feed and forage capacity. The ELRRPP will help alleviate some of the 
financial stress that sheep producers are facing with an infusion of 
funds to improve their flocks or meet other obligations.
    The Farm Service Agency published a proposed rule for ELRRPP 
regulations on September 7, 2004, with a 30-day comment period which 
ended on October 7, 2004. The proposed rule provided that ELRRPP be 
based on ewe lambs held in the period between August 1, 2003, through 
July 31, 2004, and then, on through the end of the lamb's own offspring 
lambing cycle, end at the conclusion of the application period and 
disbursement of allotted funds. The program will operate under 
regulations codified in 7 CFR part 784.

Comments and Changes to Final Rule

    The Agency received 21 public comments during the 30-day comment 
period. One comment was received from a marketing cooperative, 8 
comments were received from sheep and lamb producer associations, and 
12 comments were received from individual members of sheep and lamb 
companies or ranch operations. All comments received were in support of 
the Ewe Lamb Replacement and Retention Payment Program and expressed 
the need for the program because of bad drought conditions that have 
severely impacted the sheep and lamb industry over the past few years. 
In addition, 19 out of 21 of the comments received requested the Agency 
implement an expeditious sign-up and conclusion so that payments can be 
issued to producers before the end of the calendar year. No substantive 
changes were made from the regulations contained in the proposed rule. 
However, clarifying changes were made to conform the new program with 
that previously administered and to promote efficiency. An unnecessary 
and inaccurate reference to a finality rule has been eliminated. Also, 
a clarifying provision has been added, among others, to specify that a 
purchase without possession during the base period would not constitute 
an acquisition in the base period. As clarified, a qualifying ewe lamb 
must at some point in the base period have been under 18 months old and 
not have, at that time, produced an offspring of its own. To receive 
payment, the applicant must certify that the lamb meets program 
conditions. The certification must show that, as of the time of 
certification, the lamb does not have parrot mouth, foot rot, or 
scrapie. Spot checks will be conducted and lambs found to have these 
conditions will be ineligible for payment. Other requirements apply, 
including holding the lamb for a specified period of time tied to the 
lambing cycle. Funding of the program is limited, and claims will 
accordingly be limited. A few comments indicated confusion with the 
information collection requirements of the program. These comments will 
be addressed in the Agency's submission of the information collection 
to the Office of Management and Budget (OMB) under the Paperwork 
Reduction Act.

Executive Order 12866

    This rule is issued in conformance with Executive Order 12866. This 
rule has been determined to be ``Not Significant,'' and was not 
reviewed by OMB.

Regulatory Flexibility Act

    The Regulatory Flexibility Act is not applicable to this rule 
because FSA is not required by 5 U.S.C. 533 or any other law to publish 
a notice of proposed rulemaking for the subject matter of this rule.

Environmental Review

    It has been determined by an environmental assessment (EA) that the 
actions of the Ewe Lamb Replacement and Retention Payment Program 
(ELRRPP) will have no significant impact on the quality of the human 
environment. Therefore, an Environmental Impact Statement is not 
necessary to address the potential impacts of this rule.

Executive Order 12988

    This rule has been reviewed in accordance with Executive Order 
12988. This rule preempts State laws that are inconsistent with this 
rule. Before any legal action may be brought regarding determinations 
made under 7 CFR part 784, administrative appeal provisions set forth 
at 7 CFR parts 11 and 780 must be exhausted.

Executive Order 12372

    This program is not subject to the provisions of Executive Order 
12372. See 48 FR 29115 (June 24, 1983) for the notice related to 7 CFR 
part 3014, subpart V.

Unfunded Mandates Reform Act

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

Paperwork Reduction Act of 1995

    The information collection required to support ELRRPP has been 
approved by OMB and assigned OMB control number 0560-0246.

Executive Order 12612

    This rule has no Federalism implications warranting a Federalism 
Assessment. This rule will not affect States, or their political 
subdivisions, or the distribution of power and

[[Page 76837]]

responsibilities among levels of government.

List of Subjects in 7 CFR Part 784

    Agriculture, Livestock, Reporting and recordkeeping requirements.

0
Accordingly, 7 CFR part 784 is revised to read as follows:

PART 784--2004 EWE LAMB REPLACEMENT AND RETENTION PAYMENT PROGRAM

Sec.
784.1 Applicability.
784.2 Administration.
784.3 Definitions.
784.4 Time and method of application.
784.5 Payment eligibility.
784.6 Rate of payment and limitations on funding.
784.7 Availability of funds.
784.8 Appeals.
784.9 Misrepresentation and scheme or device.
784.10 Estates, trusts, and minors.
784.11 Death, incompetence, or disappearance.
784.12 Maintaining records.
784.13 Refunds; joint and several liability.
784.14 Offsets and withholdings.
784.15 Assignments.
784.16 Termination of program.

    Authority: Clause (3) of section 32 of the Act of August 24, 
1935, as amended; 7 U.S.C. 612c.


Sec.  784.1  Applicability.

    (a) Subject to the availability of funds, this part establishes 
terms and conditions under which the 2004 Ewe Lamb Replacement and 
Retention Payment Program will be administered.
    (b) Unless otherwise determined by the Farm Service Agency (FSA) in 
accordance with the provisions of this part, the amount that may be 
expended under this part for program payments shall not exceed $18 
million. Claims that exceed that amount will be prorated in accordance 
with Sec.  784.7.
    (c) To be eligible for payments, producers must comply with all 
provisions of this part and with any other conditions imposed by FSA.


Sec.  784.2  Administration.

    (a) This part shall be administered by FSA under the general 
direction and supervision of the Deputy Administrator for Farm 
Programs, FSA. The program shall be carried out in the field by FSA 
State and county committees (State and county committees) in accordance 
with their assigned duties and the regulations of this part.
    (b) The Deputy Administrator for Farm Programs, FSA, or a designee, 
may reverse or modify a determination made by a State or county 
committee.
    (c) The Deputy Administrator for Farm Programs, FSA, may waive or 
modify deadlines and other program requirements in cases where 
timeliness or failure to meet such other requirements does not 
adversely affect the operation of the program.
    (d) The program described under this part is a one-time program to 
be administered with respect to eligibility and qualifying factors 
occurring during or related to the base period of August 1, 2003 
through July 31, 2004, as specified in this part.


Sec.  784.3  Definitions.

    The definitions in this section shall apply to the 2004 Ewe Lamb 
Replacement and Retention Payment Program and this part.
    Agricultural Marketing Service or AMS means the Agricultural 
Marketing Service of the Department.
    Application means the Ewe Lamb Replacement and Retention Payment 
Program Application.
    Application period means the date established by the Deputy 
Administrator for producers to apply for program benefits. Unless 
otherwise announced, that period will end January 13, 2005.
    Base period means the period from August 1, 2003, through July 31, 
2004, during and after which ewe lambs must meet all qualifying 
eligibility criteria.
    Ewe lamb means a female lamb no more than 18 months of age that has 
not produced an offspring.
    Farm Service Agency or FSA means the Farm Service Agency of the 
Department.
    Foot rot means an infectious, contagious disease of sheep that 
causes severe lameness and economic loss from decreased flock 
production.
    Lambing cycle means the period of time from birth to weaning.
    Parrot mouth means a genetic defect resulting in the failure of the 
incisor teeth to meet the dental pad correctly.
    Person means any individual, group of individuals, partnership, 
corporation, estate, trust, association, cooperative, or other business 
enterprise or other legal entity who is, or whose members are, a 
citizen or citizens of, or legal resident alien or aliens in the United 
States.
    Sheep and lamb operation means any self-contained, separate 
enterprise operated as an independent unit exclusively within the 
United States in which a person or group of persons raise sheep and/or 
lambs.
    United States means the 50 States of the United States of America, 
the District of Columbia, and the Commonwealth of Puerto Rico.


Sec.  784.4  Time and method of application.

    (a) A request for benefits under this part must be submitted on the 
Ewe Lamb Replacement and Retention Program Application. The application 
form may be obtained in person, by mail, by telephone, or by facsimile 
from any county FSA office. In addition, applicants may download a copy 
of the form at http://www.usda.gov/dafp/psd/.
    (b) The form may be obtained from and must be submitted to the FSA 
county office serving the county where the sheep and lamb operation is 
located. The completed form must be received by the FSA county office 
by the date established by FSA. Applications not received by that date 
will be disapproved and returned as not having been timely filed and 
the sheep and lamb operation filing the application will not be 
eligible for benefits under this program.
    (c) The sheep and lamb operation requesting benefits under this 
part must certify to the accuracy of the information provided in their 
application for benefits. All information provided is subject to 
verification and spot checks by FSA. Refusal to allow FSA or any other 
agency of the Department of Agriculture to verify any information 
provided will result in a determination of ineligibility. Data 
furnished by the applicant will be used to determine eligibility for 
program benefits. Providing a false certification will lead to 
ineligibility for payments and may be subject to additional civil and 
criminal sanctions.
    (d) The sheep and lamb operation requesting benefits under this 
part must maintain accurate records that document that they meet all 
eligibility requirements specified herein, as may be requested by FSA. 
Acceptable forms of supporting documentation include, but are not 
limited to: Sales receipts, farm management records, veterinarian 
certifications, scrapie program forms and identification numbers, as 
well as, other types of documents that prove the eligibility of the 
qualifying ewe lambs and the sheep and lamb operation. The supporting 
documentation provided must, at a minimum, include: date of lamb 
purchase or date of birth, date of lamb death (if applicable), lamb 
identification and control information, number of ewe lambs purchased 
or retained, and scrapie program identification numbers.


Sec.  784.5  Payment eligibility.

    (a) Payments can be made, as agreed to by FSA and subject to the 
availability of funds, for eligible ewe lambs considered by FSA, as 
determined by FSA only, to have been acquired or held during the base 
period by eligible sheep and lamb operations for breeding purposes. 
Payments may be made for

[[Page 76838]]

eligible ewe lambs held continuously by the operation, through the end 
of the compliance period, from the time of the first possession of the 
ewe lamb in the base period. The payment rate cannot exceed the rate 
provided for in Sec.  784.6 and may be prorated pursuant to Sec.  
784.7. For purposes of this section, the ``base period'' is the period 
from August 1, 2003, through July 31, 2004. A purchase in the base 
period without possession in the base period will not be considered an 
acquisition in the base period for purposes of this section unless 
otherwise allowed by FSA.
    (b) For the ewe lamb to be eligible, a sheep and lamb operation 
must certify that the ewe lamb:
    (1) During at least part of the base period was a ewe lamb which 
was both, at the same time, not older than 18 months of age and had not 
produced an offspring; and
    (2) At the time of certification, does not possess any of the 
following characteristics:
    (i) Parrot mouth; or
    (ii) Foot rot.
    (c) The sheep and lamb operation must certify and agree to:
    (1) Maintain the qualifying ewe lambs in the herd for at least one 
complete, normal offspring lambing cycle, the end of which shall 
constitute the end of the compliance period for the purposes of 
paragraph (a) of this section, and actually maintain the lambs for that 
period in accord with that certification. The ``offspring'' lambing 
cycle refers to the time in which the qualifying ewe lamb's own 
offspring would be weaned, in a normal course, from that qualifying ewe 
if the ewe were to have offspring, irrespective of whether the ewe 
actually produces offspring.
    (2) Upon request by an AMS agent or FSA representative, allow the 
AMS agent or FSA Representative to verify that the ewe lambs meet 
qualifying characteristics. Spot checks will be conducted by FSA within 
30 days of the end of the sign-up period. Any animal showing evidence 
of parrot mouth, foot rot, or scrapie in such spot checks will be 
considered to have had those conditions at the time of certification. 
Other spot checks may be conducted as needed.
    (3) Maintain documentation of any death loss of qualifying ewe 
lambs.
    (4) Agree to refund any payments made with respect to any ewe lamb 
or offspring that has died before completing the full program 
requirements where said deaths for the operation exceed 10 percent.
    (5) Be in compliance with all requirements relating to scrapie, as 
described in 9 CFR parts 54 and 79.
    (d) To be eligible for any payments addressed under this section, a 
sheep and lamb operation must be engaged in the business of producing 
and marketing agricultural products at the time of filing the 
application.
    (e) In addition, to be eligible for payment, a sheep and lamb 
operation must submit a timely application during the application 
period for benefits and comply with all other terms and conditions of 
this part or that are contained in the application for such benefits, 
and such other conditions as may be imposed by FSA.
    (f) Proof that each lamb was held during and through the end of the 
base period as required by paragraph (a) of this section, as must be 
determined individually for each lamb, shall be provided in such 
manner, and with such access to the operation and the documents and 
information related to the operation, as FSA may request.


Sec.  784.6  Rate of payment and limitations on funding.

    (a) Subject to the availability of funds and to the proration 
provisions of Sec.  784.7, payments for qualifying operations shall be 
$18 for each qualifying ewe lamb retained or purchased for breeding 
purposes.


Sec.  784.7  Availability of funds.

    Total payments under this part, unless otherwise determined by the 
FSA, cannot exceed $18 million. In the event that approval of all 
eligible applications would result in expenditures in excess of the 
amount available, FSA shall prorate the available funds by a national 
factor to reduce the expected payments to be made to the amount 
available. The payment shall be made based on the national factored 
rate as determined by FSA. FSA shall prorate the payments in such 
manner as it, in its sole discretion, finds appropriate and reasonable.


Sec.  784.8  Appeals.

    The appeal regulations set forth at parts 11 and 780 of this title 
apply to determinations made pursuant to this part.


Sec.  784.9  Misrepresentation and scheme or device.

    (a) A sheep and lamb operation shall be ineligible to receive 
assistance under this program if it is determined by the State 
committee or the county committee to have:
    (1) Adopted any scheme or device that tends to defeat the purpose 
of this program;
    (2) Made any fraudulent representation; or
    (3) Misrepresented any fact affecting a program determination.
    (b) Any funds disbursed pursuant to this part to any person or 
operation engaged in a misrepresentation, scheme, or device, shall be 
refunded with interest together with such other sums as may become due. 
Any sheep and lamb operation or person engaged in acts prohibited by 
this section and any sheep and lamb operation or person receiving 
payment under this part shall be jointly and severally liable with 
other persons or operations involved in such claim for benefits for any 
refund due under this section and for related charges. The remedies 
provided in this part shall be in addition to other civil, criminal, or 
administrative remedies that may apply.


Sec.  784.10  Estates, trusts, and minors.

    (a) Program documents executed by persons legally authorized to 
represent estates or trusts will be accepted only if such person 
furnishes evidence of the authority to execute such documents.
    (b) A minor who is otherwise eligible for assistance under this 
part must, also:
    (1) Establish that the right of majority has been conferred on the 
minor by court proceedings or by statute;
    (2) Show a guardian has been appointed to manage the minor's 
property and the applicable program documents are executed by the 
guardian; or
    (3) Furnish a bond under which the surety guarantees any loss 
incurred for which the minor would be liable had the minor been an 
adult.


Sec.  784.11  Death, incompetence, or disappearance.

    In the case of death, incompetence, disappearance or dissolution of 
a person that is eligible to receive benefits in accordance with this 
part, such person or persons specified in 7 CFR part 707 may receive 
such benefits, as determined appropriate by FSA.


Sec.  784.12  Maintaining records.

    Persons making application for benefits under this program must 
maintain accurate records and accounts that will document that they 
meet all eligibility requirements specified herein. Such records and 
accounts must be retained for 3 years after the date of payment to the 
sheep and lamb operations under this program. Destruction of the 
records after such date shall be at the risk of the party undertaking 
the destruction.


Sec.  784.13  Refunds; joint and several liability.

    (a) In the event there is an inaccurate certification or a failure 
to comply with

[[Page 76839]]

any term, requirement, or condition for payment arising under the 
application, or this part, and if any refund of a payment to FSA shall 
otherwise become due in connection with the application, or this part, 
all related payments made under this part to any sheep and lamb 
operation shall be refunded to FSA together with interest as determined 
in accordance with paragraph (c) of this section and late payment 
charges as provided in part 1403 of this title.
    (b) All persons signing a sheep and lamb operation's application 
for payment as having an interest in the operation shall be jointly and 
severally liable for any refund, including related charges, that is 
determined to be due for any reason under the terms and conditions of 
the application or this part with respect to such operation.
    (c) Interest shall be charged on refunds required of any person 
under this part if FSA determines that payments or other assistance was 
provided to a person who was not eligible for such assistance. Such 
interest shall be charged at the rate of interest that the United 
States Treasury charges the Commodity Credit Corporation for funds, 
from the date FSA made such benefits available to the date of repayment 
or the date interest increases as determined in accordance with 
applicable regulations. FSA may waive the accrual of interest if FSA 
determines that the cause of the erroneous determination was not due to 
any action of the person.
    (d) Interest determined in accordance with paragraph (c) of this 
section may be waived at the discretion of FSA alone for refunds 
resulting from those violations determined by FSA to have been beyond 
the control of the person committing the violation.
    (e) Late payment interest shall be assessed on all refunds in 
accordance with the provisions of, and subject to the rates prescribed 
in 7 CFR part 792.
    (f) Any excess payments made by FSA with respect to any application 
under this part must be refunded.
    (g) In the event that a benefit under this subpart was provided as 
the result of erroneous information provided by any person, the benefit 
must be repaid with any applicable interest.


Sec.  784.14  Offsets and withholdings.

    FSA may offset or withhold any amounts due FSA under this subpart 
in accordance with the provisions of 7 CFR part 792, or successor 
regulations, as designated by the Department.


Sec.  784.15  Assignments.

    Any person who may be entitled to a payment may assign his rights 
to such payment in accordance with 7 CFR part 1404, or successor 
regulations, as designated by the Department.


Sec.  784.16  Termination of program.

    This program will be terminated after payment has been made to 
those applications certified as eligible pursuant to the application 
period established in Sec.  784.4.

    Signed at Washington, on DC on December 17, 2004.
Michael W. Yost,
Acting Administrator, Farm Service Agency.
[FR Doc. 04-28061 Filed 12-22-04; 8:45 am]
BILLING CODE 3410-05-P