[Federal Register Volume 76, Number 141 (Friday, July 22, 2011)]
[Proposed Rules]
[Pages 43936-43937]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-18393]


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 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. 76, No. 141 / Friday, July 22, 2011 / 
Proposed Rules  

[[Page 43936]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 1000 and 1033

[Doc. No. AMS-DA-08-0049; AO-166-A77; DA-08-06]


Milk in the Mideast Marketing Area; Order To Terminate Proceeding 
on Proposed Amendments to Marketing Agreement and Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Termination of proceeding.

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SUMMARY: This action terminates a rulemaking proceeding that proposed 
to amend Class I prices for certain counties of the Mideast milk 
marketing area. Marketing conditions since the close of the hearing on 
the proposal have changed substantially, no longer warranting a change.

DATES: The rulemaking proceeding is terminated as of July 23, 2011.

FOR FURTHER INFORMATION CONTACT: Erin C. Taylor, Order Formulation and 
Enforcement, USDA/AMS/Dairy Programs, STOP 0231-Room 2971, 1400 
Independence Avenue, SW., Washington, DC 20250-0231, (202) 720-7311, e-
mail address: [email protected] mailto: [email protected].

SUPPLEMENTARY INFORMATION: This administrative action 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 action terminates the rulemaking proceeding concerning Class I 
prices for the Mideast order. The proposal was considered at a public 
hearing held August 19-20, 2008. The Secretary issued a recommended 
decision on the proposed amendment on January 8, 2009, and it was 
published on January 14, 2009 (74 FR 1976).

Regulatory Flexibility Act and Paperwork Reduction Act

    In accordance with the Regulatory Flexibility Act (5 U.S.C. 601-
612), the Agricultural Marketing Service has considered the economic 
impact of this action on small entities and has certified that the 
termination of this proceeding 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 
a dairy farm operation, it should be an inclusive standard for most 
small dairy farms. 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 August 2008, the time of the hearing, there were 7,376 dairy 
farms pooled on the Mideast order. Of these, approximately 6,927 dairy 
farms (or 93.9 percent) were considered small businesses.
    During August 2008, there were 53 handler operations associated 
with the Mideast order (27 fully regulated handlers, 9 partially 
regulated handlers, 2 producer-handlers and 15 exempt handlers). Of 
these, approximately 43 handlers (or 81 percent) were considered small 
businesses.
    Minimum Class I prices are determined in all Federal milk marketing 
orders by adding a location specific differential, referred to as a 
``Class I differential,'' to the higher of an advance Class III and 
Class IV price announced by USDA. The proposed amendments sought to 
increase the Class I prices in the southern tier of counties of the 
Mideast marketing area. Minimum Class I prices charged to regulated 
handlers are applied uniformly to both large and small entities.
    Because this action terminates the rulemaking proceeding without 
amending the Class I prices of the Mideast marketing order, the 
economic conditions of small entities remain unchanged. This action 
does not change reporting, record keeping, or other compliance 
requirements.
    Prior documents in this proceeding:
    Notice of Hearing: Issued July 21, 2008; published July 24, 2008 
(73 FR 43160).
    Recommended Decision: Issued January 8, 2009; published January 14, 
2009 (74 FR 1976).

Preliminary Statement

    A public hearing was held upon proposed amendments to the marketing 
agreements and orders regulating the handling of milk in the Mideast 
marketing area. The hearing was held, 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), Cincinnati, Ohio, on August 19-20, 2008, pursuant to a notice of 
hearing issued July 21, 2008, and published in the Federal Register on 
July 24, 2008 (73 FR 43160).

Class I Prices

    This action terminates the rulemaking concerning proposed 
amendments to the Class I prices of the Mideast marketing order. A 
proposal published in the hearing notice as Proposal 1 sought to 
increase the Class I prices up to $0.20 per hundredweight in 110 
counties in the southern portion of the marketing area. USDA issued a 
recommended decision on January 8, 2009, recommending the adoption of 
Proposal 1, modified to recommend a $0.20 increase in the Class I price 
at Charleston, West Virginia.
    The recommended decision was based on three primary factors: (1) 
The southern tier of counties in the Mideast marketing area is a 
deficit region that must rely on more distant milk to service its fluid 
distributing plants; (2) higher Class I prices brought about by 
providing higher Class I price adjustments in the Southeast, 
Appalachian and Florida marketing orders (southeastern orders) have 
resulted in more milk servicing those orders from farms located in the 
Mideast marketing area; and (3) transportation

[[Page 43937]]

costs had increased such that the Class I differentials did not offer 
sufficient pricing incentives to cover the cost of transporting milk 
from reserve northern surplus regions to the deficit southern region of 
the marketing area.
    As noted in almost all the exceptions to the recommended decision, 
marketing conditions since the close of the hearing have changed 
substantially no longer warranting a change in the Class I price 
surface of the Mideast marketing area. Exceptions filed on behalf of 
the proponents of Proposal 1 (Michigan Milk Producers Association, 
Inc., Foremost Farms USA Cooperative, Inc., National Farmers 
Organization Inc., and Dairy Farmers of America, Inc.) requested that 
USDA take no action.

Termination of Proceeding

    In view of the foregoing, it is hereby determined that this 
proceeding with respect to proposed amendment to the Mideast order 
regarding Class I prices should be and is hereby terminated.

List of Subjects in 7 CFR Parts 1000 and 1033

    Milk marketing orders.

    The authority citation for 7 CFR Parts 1000 and 1033 continues to 
read as follows:

    Authority:  7 U.S.C. 601-674, and 7253.

    Dated: July 14, 2011.
David R. Shipman,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2011-18393 Filed 7-21-11; 8:45 am]
BILLING CODE 3410-02-P