[Federal Register Volume 70, Number 185 (Monday, September 26, 2005)]
[Rules and Regulations]
[Pages 56111-56113]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-19086]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1033

[Docket No. AO-166-A39; DA-05-01-A]


Milk in the Mideast Marketing Area; Interim Order Amending the 
Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule.

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SUMMARY: This order amends certain features of the pooling standards of 
the Mideast milk marketing order on an interim basis. More than the 
required number of producers in the Mideast marketing area have 
approved the issuance of the interim order as amended.

DATES: Effective October 1, 2005.

FOR FURTHER INFORMATION CONTACT: Gino M. Tosi, Associate Deputy 
Administrator, Stop 0231, Room 2971, USDA/AMS/Dairy Programs, Order 
Formulation and Enforcement Branch, 1400 Independence Avenue, SW., 
Washington, DC 20250-0231, (202) 690-1366, e-mail address: 
[email protected].

SUPPLEMENTARY INFORMATION: Specifically, this decision adopts 
provisions that will: (1) Prohibit the ability to simultaneously pool 
the same milk on the Mideast Federal milk order and on a marketwide 
equalization pool administered by another government entity; (2) Lower 
the diversion limit standards; and (3) Increase the performance 
standards for supply plants.
    This administrative rule is governed by the provisions of sections 
556 and 557 of title 5 of the United States Code and, therefore, is 
excluded from the requirements of Executive Order 12866.
    This interim rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is not intended to have a retroactive 
effect. This rule will not preempt any State or local laws, 
regulations, or policies, unless they present an irreconcilable 
conflict with this rule.
    The Agricultural Marketing Agreement Act of 1937 (the Act), as 
amended (7 U.S.C. 601-674), provides that administrative proceedings 
must be exhausted before parties may file suit in court. Under Section 
608c(15)(A) of the Act, any handler subject to an order may request 
modification or exemption from such order by filing with the Department 
of Agriculture (Department) 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 the law. A handler is afforded the 
opportunity for a hearing on the petition. After a hearing, the 
Department would rule on the petition. The Act provides that the 
District Court of the United States in any district in which the 
handler is an inhabitant, or has its principal place of business, has 
jurisdiction in equity to review the Department's ruling on the 
petition, provided a bill in equity is filed not later than 20 days 
after the date of the entry of the ruling.

Regulatory Flexibility Act and Paperwork Reduction Act

    In accordance with the Regulatory Flexibility Act (5 U.S.C. 601 et 
seq.), the Agricultural Marketing Service has considered the economic 
impact of this action on small entities and has certified that this 
interim rule will not have a significant economic impact on a 
substantial number of small entities. For the purpose of the Regulatory 
Flexibility Act, a dairy farm is considered a ``small business'' if it 
has an annual gross revenue of less than $750,000, and a dairy products 
manufacturer is a ``small business'' if it has fewer than 500 
employees.
    For the purposes of determining which dairy farms are ``small 
businesses,'' the $750,000 per year criterion was used to establish a 
production guideline of 500,000 pounds per month. Although this 
guideline does not factor in additional monies that may be received by 
dairy producers, it should be an inclusive standard for most ``small'' 
dairy farmers. For purposes of determining a handler's size, if the 
plant is part of a larger company operating multiple plants that 
collectively exceed the 500-employee limit, the plant will be 
considered a large business even if the local plant has fewer than 500 
employees.
    During March 2005, the month during which the hearing occurred, 
there were 9,767 dairy producers pooled on, and 36 handlers regulated 
by, the Mideast order. Approximately 9,212 producers,

[[Page 56112]]

or 94.3 percent, were considered small businesses based on the above 
criteria. Of the 36 handlers regulated by the Mideast order, 
approximately 26 handlers, or 72.2 percent, were considered small 
businesses.
    The adoption of the proposed pooling standards serve to revise 
established criteria that determine those producers, producer milk and 
plants that have a reasonable association with, and are consistently 
serving the fluid needs of, the Mideast milk marketing area. Criteria 
for pooling are established on the basis of performance levels that are 
considered adequate to meet the Class I fluid needs and, by doing so, 
determine those producers who are eligible to share in the revenue that 
arises from the classified pricing of milk. Criteria for pooling are 
established without regard to the size of any dairy industry 
organization or entity. The established criteria are applied in an 
identical fashion to both large and small businesses and do not have 
any different economic impact on small entities as opposed to large 
entities. Therefore, the proposed amendments will not have a 
significant economic impact on a substantial number of small entities.
    A review of reporting requirements was completed under the 
Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35). It was 
determined that these adopted amendments will have no impact on 
reporting, recordkeeping, or other compliance requirements because they 
will remain identical to the current requirements. No new forms are 
proposed and no additional reporting requirements will be necessary.
    This action does not require additional information collection that 
requires clearance by the Office of Management and Budget (OMB) beyond 
currently approved information collection. The primary sources of data 
used to complete the forms are routinely used in most business 
transactions. Forms require only a minimal amount of information which 
can be supplied without data processing equipment or a trained 
statistical staff. Thus, the information collection and reporting 
burden is relatively small. Requiring the same reports for all handlers 
does not significantly disadvantage any handler that is smaller than 
the industry average.
    Prior documents in this proceeding:
    Amendment to Public Hearing on Proposed Rulemaking: Issued March 1, 
2005; published March 3, 2005 (70 FR 10337).
    Notice of Hearing: Issued February 14, 2005; published February 17, 
2005 (70 FR 8043).
    Tentative Partial Decision: Issued July 21, 2005; published July 
27, 2005 (70 FR 43335).

Findings and Determinations

    The findings and determinations hereinafter set forth supplement 
those that were made when the Mideast order was first issued and when 
it was amended. The previous findings and determinations are hereby 
ratified and confirmed, except where they may conflict with those set 
forth herein.
    The following findings are hereby made with respect to the Mideast 
order:
    (a) Findings upon the basis of the hearing record. Pursuant to the 
provisions of the Agricultural Marketing Agreement Act of 1937, as 
amended (7 U.S.C. 601-674), and the applicable rules of practice and 
procedure governing the formulation of marketing agreements and 
marketing orders (7 CFR part 900), a public hearing was held upon 
certain proposed amendments to the tentative marketing agreement and to 
the order regulating the handling of milk in the Mideast marketing 
area.
    Upon the basis of the evidence introduced at such hearing and the 
record thereof it is found that:
    (1) The Mideast order, as hereby amended on an interim basis, and 
all of the terms and conditions thereof, will tend to effectuate the 
declared policy of the Act;
    (2) The parity prices of milk, as determined pursuant to section 2 
of the Act, are not reasonable in view of the price of feeds, available 
supplies of feeds, and other economic conditions which affect market 
supply and demand for milk in the marketing area, and the minimum 
prices specified in the order, as hereby amended on an interim basis, 
are such prices as will reflect the aforesaid factors, insure a 
sufficient quantity of pure and wholesome milk, and be in the public 
interest; and
    (3) The Mideast order, as hereby amended on an interim basis, 
regulates the handling of milk in the same manner as, and is applicable 
only to persons in the respective classes of industrial and commercial 
activity specified in, a marketing agreement upon which a hearing has 
been held.
    (b) Additional Findings. It is necessary and in the public interest 
to make these interim amendments to the Mideast order effective October 
1, 2005. Any delay beyond that date would tend to disrupt the orderly 
marketing of milk in the aforesaid marketing area.
    The interim amendments to this order are known to handlers. The 
tentative partial final decision containing the proposed amendments to 
this order was issued on July 21, 2005.
    The changes that result from these interim amendments will not 
require extensive preparation or substantial alteration in the method 
of operation for handlers. In view of the foregoing, it is hereby found 
and determined that good cause exists for making these interim order 
amendments effective on October 1, 2005.
    (c) Determinations. It is hereby determined that:
    (1) The refusal or failure of handlers (excluding cooperative 
associations specified in Section 8c(9) of the Act) of more than 50 
percent of the milk, which is marketed within the specified marketing 
area, to sign a proposed marketing agreement, tends to prevent the 
effectuation of the declared policy of the Act;
    (2) The issuance of this interim order amending the Mideast order 
is the only practical means pursuant to the declared policy of the Act 
of advancing the interests of producers as defined in the order as 
hereby amended;
    (3) The issuance of the interim order amending the Mideast order is 
favored by at least two-thirds of the producers who were engaged in the 
production of milk for sale in the marketing area.

List of Subjects in 7 CFR Part 1033

    Milk marketing orders.

Order Relative to Handling

0
It is therefore ordered, that on and after the effective date hereof, 
the handling of milk in the Mideast marketing area shall be in 
conformity to and in compliance with the terms and conditions of the 
order, as amended, and as hereby further amended on an interim basis, 
as follows:

PART 1033--MILK IN THE MIDEAST AREA

0
1. The authority citation for 7 CFR Part 1033 reads as follows:

    Authority: 7 U.S.C. 601-674.


0
2. Section 1033.7 is amended by:
0
(a) Revising paragraph (c) introductory text.
0
(b) Revising the introductory text of paragraph (d).
0
(c) Revising paragraph (d)(2).
0
(d) Revising paragraph (e)(1).
    The revisions read as follows:


Sec.  1033.7  Pool plant.

* * * * *
    (c) A supply plant from which the quantity of bulk fluid milk 
products shipped to, received at, and physically unloaded into plants 
described in paragraph (a) or (b) of this section as a percent of the 
Grade A milk received at the plant from dairy farmers (except

[[Page 56113]]

dairy farmers described in Sec.  1033.12(b)) and handlers described in 
Sec.  1000.9(c), as reported in Sec.  1033.30(a), is not less than 40 
percent of the milk received from dairy farmers, including milk 
diverted pursuant to Sec.  1033.13, subject to the following 
conditions:
* * * * *
    (d) A plant located in the marketing area and operated by a 
cooperative association if, during the months of December through July 
30 percent, during the month of August 35 percent and during the months 
of September through November 40 percent or more of the producer milk 
of members of the association is delivered to a distributing pool 
plant(s) or to a nonpool plant(s) and classified as Class I. Deliveries 
for qualification purposes may be made directly from the farm or by 
transfer from such association's plant, subject to the following 
conditions:
* * * * *
    (2) The 30 percent delivery requirement for the months of December 
through July may be met for the current month or it may be met on the 
basis of deliveries during the preceding 12-month period ending with 
the current month.
* * * * *
    (e) * * *
    (1) The aggregate monthly quantity supplied by all parties to such 
an agreement as a percentage of the producer milk receipts included in 
the unit during the months of August through November is not less than 
45 percent and during the months of December through July is not less 
than 35 percent;
* * * * *

0
3. Section 1033.13 is amended by:
0
(a) Revising paragraph (d)(4).
0
(b) Adding paragraph (e).
    The revisions read as follows:


Sec.  1033.13  Producer milk.

* * * * *
    (d) * * *
    (4) Of the total quantity of producer milk received during the 
month (including diversions but excluding the quantity of producer milk 
received from a handler described in Sec.  1000.9(c) or which is 
diverted to another pool plant), the handler diverted to nonpool plants 
not more than 50 percent in each of the months of August through 
February and 60 percent in each of the months of March through July.
* * * * *
    (e) Producer milk shall not include milk of a producer that is 
subject to inclusion and participation in a marketwide equalization 
pool under a milk classification and pricing plan imposed under the 
authority of another government entity.

    Dated: September 20, 2005.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 05-19086 Filed 9-23-05; 8:45 am]
BILLING CODE 3410-02-P