[Federal Register Volume 65, Number 8 (Wednesday, January 12, 2000)]
[Proposed Rules]
[Pages 1825-1829]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-687]
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NORTHEAST DAIRY COMPACT COMMISSION
7 CFR Parts 1301, 1304, 1305, 1306, 1307 and 1308
Over-Order Price Regulation
AGENCY: Northeast Dairy Compact Commission.
ACTION: Proposed rule; notice of hearing.
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SUMMARY: The Northeast Dairy Compact Commission proposes to amend the
over-order price regulation to make technical amendments to certain
definitions and to change certain dates of required action. The
proposed rule is necessary to conform the over-order price regulation
to similar regulations recently reformed by the United States
Department of Agriculture regarding milk marketed in the New England
states. These amendments will ensure continuity of regulatory
definitions and compliance dates in the New England milk market. The
Commission also proposes to amend the definition of producer to specify
every December since 1996 as a condition of qualification.
DATES: A public hearing will be held on February 2, 2000 at 10 a.m.
Sworn and notarized written testimony, comments and exhibits may be
submitted until 5 p.m. on February 16, 2000.
ADDRESSES: The public hearing will be held at Centennial Inn, 96
Pleasant Street, Concord, New Hampshire. Mail, or deliver, sworn and
notarized testimony, comments and exhibits to: Northeast Dairy Compact
Commission, 34 Barre Street, Suite 2, Montpelier, Vermont 05602.
FOR FURTHER INFORMATION CONTACT: Kenneth M. Becker, Executive Director,
Northeast Dairy Compact Commission at the above address or by telephone
at (802) 229-1941, or by facsimile at (802) 229-2028.
SUPPLEMENTARY INFORMATION:
I. Background
The Northeast Dairy Compact Commission (``Commission'') was
[[Page 1826]]
established under authority of the Northeast Interstate Dairy Compact
(``Compact''). The Compact was enacted into law by each of the six
participating New England states as follows: Connecticut--Pub. L. 93-
320; Maine--Pub. L. 89-437, as amended, Pub. L. 93-274; Massachusetts--
Pub. L. 93-370; New Hampshire--Pub. L. 93-336; Rhode Island--Pub. L.
93-106; Vermont--Pub. L. 93-57. In accordance with Article I, Section
10 of the United States Constitution, Congress consented to the Compact
in Pub. L. 104-127 (FAIR Act), Section 147, codified at7 U.S.C. 7256.
Subsequently, the United States Secretary of Agriculture, pursuant to 7
U.S.C. 7256(1), authorized implementation of the Compact. Authorization
of the Compact was extended until September 30, 2001 in the
Consolidated Appropriations Act for Fiscal Year 2000, Pub. L. 106-113,
115 Stat. 1501, November 29, 1999.
Pursuant to its rulemaking authority under Article V, Section 11 of
the Compact, the Commission concluded an informal rulemaking process
and voted to adopt a compact over-order price regulation on May 30,
1997.1 The Commission subsequently amended and extended the
compact over-order price regulation.2 In 1998 and 1999, the
Commission further amended specific provisions of the over-order price
regulation.3 The current compact over-order price regulation
is codified at 7 CFR Chapter XIII.
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\1\ 62 FR 29626 (May 30, 1997).
\2\ 62 FR 62810 (Nov. 25, 1997).
\3\ See, e.g., 63 FR 10104 (Feb. 27, 1998); 63 FR 46385 (Sept.
1, 1998); 63 FR 65517 (Nov. 27, 1998); 64 FR 23532 (May 3, 1999);
and 64 FR 34511 (June 28, 1999).
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On November 29, 1999, the President signed into law the
Consolidated Appropriations Act, 2000 (Pub. L. 106-113, 115 Stat.
1501). That Act required the United States Secretary of Agriculture to
immediately implement certain reforms to the federal milk order
regulations. The required regulation was published in the Federal
Register on December 17, 1999, implementing and amending the final rule
that was initially published on September 1, 1999.4 The
Commission intends that the proposed amendments will bring the
Commission regulations into conformity with the reformed federal milk
market order regulations and provide consistency and uniformity in
definitions and compliance dates for regulated entities.
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\4\ 64 FR 70868 (Dec. 17, 1999); 64 FR 47898 (Sept. 1, 1999).
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II. Proposed Technical Amendments to the Over-order Price
Regulation
The Commission proposes to amend the definition of producer in
section 1301.11 to change the qualification condition from ``December
1996, December 1997 and December 1998'' to ``every December since
1996.'' This language clarifies the future application of this
condition, without necessitating annual rulemaking proceedings.
The Commission also proposes to amend definitions in Part 1301
sections 1301.9, 1301.10, 1301.14 and 1301.17 to conform to recent
amendments to definitions in the federal market order regulations. The
proposed amendment to section 1301.9, the definition of handler, brings
that section into conformity with the federal amendment to the
definition of handler in 7 CFR 1000.9 by adding certain milk brokers to
the definition. The proposed amendment to section 1301.10, the
definition of producer-handler, brings that section into conformity
with the definition of the same term in 7 CFR 1001.10, through uniform
reformatting of the definition and changing the minimum from 300 quarts
per day to 150,000 pounds per month. Similarly, the proposed amendments
to section 1301.14, fluid milk products (adds eggnog and changes
descriptive terms for various products, such as skim milk) and section
1301.17, cooperative association (includes federation of cooperatives)
bring those definitions into conformity with the reformed federal
regulations at 7 CFR 1000.15 and 1000.18, respectively.
The proposal to amend Part 1304 section 1304.1, deletes eggnog from
the list in subsection (b)(4)(iv), in conformity with the new federal
regulation at 7 CFR 1000.40(b)(2)(iv), reclassifying eggnog from Class
II to Class I. The proposal to amend Part 1305 section 1305.1 changes
the reference to the federal Class I price from the prior regulation
reference to Zone 1, Class 1 to the reformed reference in 7 CFR 1000.52
to the Class I Price for Suffolk County Massachusetts.
The Commission proposes to amend Part 1306 sections 1306.1 and
1306.2 to remove the existing minimum of a daily average of 300 quarts
to the new federal minimum of 150,000 pounds per month as codified at 7
CFR 1000.8(d)(4).
The proposed amendments in Parts 1305, 1307 and 1308 sections
1305.2, 1307.2, 1307.3, 1307.4 1307.7, 1307.9 and 1308.1 change the
prescribed dates for required action to conform to the new dates used
under the federal market order reform regulations for similar required
activities. The proposed amendments change the dates required for: (1)
Announcing the over-order obligation (from the 5th of the month to the
23rd); (2) issuing statements (from the 15th to the 13th); (3) for
making payments (including adjustments and administrative assessments)
to the producer-settlement fund (from the 18th to the 15th) and (4) for
issuing payments (including adjustments) from the fund (from the 20th
to the 16th).
The proposed amendment to Part 1307 section 1307.8 conforms to the
federal regulation at 7 CFR 1000.78 by changing the language regarding
charges on overdue accounts to include funds due to both the producer-
settlement fund and the administrative assessment fund and includes the
new requirement that all interest accrues to the administrative
assessment fund. The proposed rules also add a new section at Part 1307
section 1307.9, in conformance with the federal regulation at 7 CFR
1000.90, specifying that if a required date falls on a weekend or
holiday, the action is required on the next business day.
Official Notice of Technical, Scientific or Other Matters
Pursuant to the Commission regulations, 7 CFR 1361.5(g)(5), the
Commission hereby gives public notice that it may take official notice,
at the public hearing February 2, 2000, or afterward, of relevant
facts, statistics, data, conclusions, and other information provided by
or through the United States Department of Agriculture, including, but
not limited to, matters reported by the National Agricultural
Statistics Service, the Market Administrators, the Economic Research
Service, the Agricultural Marketing Service and information, data and
statistics developed and maintained by the Departments of Agriculture
of the States or Commonwealth within the Compact regulated area.
Public Participation in Rulemaking Proceedings
The Commission seeks and encourages oral and written testimony and
comments from all interested persons regarding these proposed rules.
The Commission continues to benefit from the valuable insights and
active participation of all segments of the affected community
including consumers, processors and producers in the development and
administration of the Over-order Price Regulation.
[[Page 1827]]
Date, Time and Location of the Public Hearing
The Northeast Dairy Compact Commission will hold a public hearing
at 10:00 a.m. on February 2, 2000 at the Centennial Inn, 96 Pleasant
Street, Concord, New Hampshire.
Request for Written Comments
Pursuant to the Commission rules, 7 CFR 1361.4, any person may
participate in the rulemaking proceeding independent of the hearing
process by submitting written comments or exhibits to the Commission.
Comments and exhibits may be submitted at any time before 5 p.m. on
February 16, 2000.
Please note: Comments and exhibits will be made part of the record
of the rulemaking proceeding only if they identify the author's name,
address and occupation, and if they include a sworn and notarized
statement indicating that the comment and/or exhibit is presented based
upon the author's personal knowledge and belief. Facsimile copies will
be accepted up until the 5 p.m. deadline, but the original must then be
sent by ordinary mail.
List of Subjects in 7 CFR Parts 1301, 1304, 1305, 1306, 1307 and
1308
Milk, Price support programs.
Codification in Code of Federal Regulations
For reasons set forth in the preamble, the Northeast Dairy Compact
Commission proposes to amend 7 CFR Parts 1301, 1304, 1305, 1306, 1307
and 1308 as follows:
PART 1301--DEFINITIONS
1. The authority citation for Part 1301 continues to read as
follows:
Authority: 7 U.S.C. 7256.
2. Amend Sec. 1301.9 to revise paragraph (e) to read as follows:
Sec. 1301.9 Handler.
Handler means:
* * * * *
(e) Any person who does not operate a plant but who engages in the
business of receiving fluid milk products for resale and distributes to
retail or wholesale outlets packaged fluid milk products received from
any plant described in paragraph (a), (b) or (c) of this section. Any
person who as a broker negotiates a purchase or sale of fluid milk
products or fluid cream products from or to any pool, partially
regulated or nonpool plant, and any person who by purchase or direction
causes milk of producers to be picked up at the farm and/or moved to a
plant. Persons who qualify as handlers only under this paragraph are
not subject to the payment provisions of Secs. 1307.3 and 1308.1.
3. Revise Sec. 1301.10 to read as follows:
Sec. 1301.10 Producer-handler.
Producer-handler means a person who:
(a) Operates a dairy farm and a distributing plant from which there
is monthly route disposition in the regulated area during the month;
(b) Receives milk solely from own farm production or receives milk
that is fully subject to the pricing and pooling provisions of any
Federal order;
(c) Receives at its plant or acquires for route disposition no more
than 150,000 pounds of fluid milk products from handlers fully
regulated under any Federal order. This limitation shall not apply if
the producer-handler's own farm production is less than 150,000 pounds
during the month;
(d) Disposes of no other source milk as Class I milk except by
increasing the nonfat milk solids content of the fluid milk products;
and
(e) Provides proof satisfactory to the compact commission that the
care and management of the dairy animals and other resources necessary
to produce all Class I milk handled (excluding receipts from handlers
fully regulated under any Federal order) and the processing and
packaging operations are the producer-handler's own enterprise and at
its own risk.
4. Amend Sec. 1301.11 to revise paragraphs (b) introductory text
and (b) (1) to read as follows:
Sec. 1301.11 Producer.
Producer means:
* * * * *
(b) A dairy farmer who produces milk outside of the regulated area
that is moved to a pool plant, provided that on more than half of the
days on which the handler caused milk to be moved from the dairy
farmer's farm in every December since 1996, all of that milk was
physically moved to a pool plant in the regulated area. Or: to be
considered a qualified producer, on more than half of the days on which
the handler caused milk to be moved from the dairy farmer's farm during
the current month and for five (5) months subsequent to July of the
preceding calendar year, all of that milk must have moved to a pool
plant, provided that the total amount of milk at a pool plant eligible
to qualify producers who did not qualify in every December since 1996,
shall not exceed the total bulk receipts of fluid milk products less:
(1) Producers receipts as described in paragraph (a) of this
section and producer receipts as described in paragraph (b) of this
section who are qualified based on every December since 1996;
* * * * *
5. Revise Sec. 1301.14 to read as follows:
Sec. 1301.14 Fluid milk product.
(a) Except as provided in paragraph (b) of this section fluid milk
product means any milk products in fluid or frozen form containing less
than nine percent butterfat, that are intended to be used as beverages.
Such products include, but are not limited to: Milk, fat-free milk, low
fat milk, light milk, reduced fat milk, milk drinks, eggnog and
cultured buttermilk, including any such beverage products that are
flavored, cultured, modified with added nonfat milk solids, sterilized,
concentrated or reconstituted. As used in this part, the term
concentrated milk means milk that contains not less than 25.5 percent,
and not more than 50 percent, total milk solids.
(b) The term fluid milk product shall not include:
(1) Plain or sweetened evaporated milk/skim milk, sweetened
condensed milk/skim milk, formulas especially prepared for infant
feeding or dietary use (meal replacement) that are packaged in
hermetically-sealed containers, any product that contains by weight
less than 6.5 percent nonfat milk solids, and whey; and
(2) The quantity of skim milk equivalent in any modified product
specified in paragraph (a) of this section that is greater than an
equal volume of an unmodified product of the same nature and butterfat
content.
6. Revise Sec. 1301.17 to read as follows:
Sec. 1301.17 Cooperative association.
Cooperative association means any cooperative marketing association
of producers which the Secretary of Agriculture of the United States
determines is qualified under the provisions of the Capper-Volstead
Act, has full authority in the sale of milk of its members and is
engaged in marketing milk or milk products for its members. A
federation of two or more cooperatives incorporated under the laws of
any state will be considered a cooperative association if all member
cooperatives meet the requirements of this section.
PART 1304--CLASSIFICATION OF MILK
2. The authority citation for Part 1304 continues to read as
follows:
[[Page 1828]]
Authority: 7 U.S.C. 7256.
3. Amend Sec. 1304.1 to revise paragraph (b)(4)(iv) to read as
follows:
Sec. 1304.1 Classification of milk.
* * * * *
(b) * * *
(4) * * *
(iv) Custards, puddings, pancake mixes, buttermilk biscuit mixes,
coatings, batter and similar products;
* * * * *
PART 1305--CLASS PRICE
1. The authority citation for Part 1305 continues to read as
follows:
Authority: 7 U.S.C. 7256.
2. Amend Sec. 1305.1 to revise paragraph (b)(2) to read as follows:
Sec. 1305.1 Compact over-order class I price and compact over-order
obligation.
* * * * *
(b) * * *
(2) Deduct Class I Price for Suffolk County, Massachusetts;
* * * * *
3. Revise Sec. 1305.2 to read as follows:
Sec. 1305.2 Announcement of compact over-order class I price and
compact over-order obligation.
The compact commission shall announce publicly on or before the
23rd day of each month the Class I over-order price and the compact
over-order obligation for the following month.
PART 1306--COMPACT OVER-ORDER PRODUCER PRICE
1. The authority citation for Part 1306 continues to read as
follows:
Authority: 7 U.S.C. 7256.
2. Revise Sec. 1306.1 to read as follows:
Sec. 1306.1 Handler's value of milk for computing basic over-order
producer price.
For the purpose of computing the basic over-order producer price,
the compact commission shall determine for each month the value of milk
of each handler with respect to each of the handler's pool plants and
of each handler described in Sec. 1301.9(d) of this chapter with
respect to milk that was not received at a pool plant, as directed in
this section. Any pool plant that does not exceed 150,000 pounds of
disposition in the compact regulated area in the month shall not be
subject to the compact over-order obligation. The total assessment for
each handler is to be calculated by multiplying the pounds of Class I
fluid milk products as determined pursuant to Sec. 1304.1(a) of this
chapter by the compact over-order obligation.
3. Revise Sec. 1306.2 to read as follows:
Sec. 1306.2 Partially regulated plant operator's value of milk for
computing basic over-order producer price.
For the purpose of computing the basic over-order producer price,
the compact commission shall determine for each month the value of milk
disposition in the regulated area by the operator of a partially
regulated plant as directed in this section. Any partially regulated
plant that does not exceed 150,000 of disposition in the compact
regulated area in the month shall not be subject to the compact over-
order obligation. The total assessment for each handler is to be
calculated by multiplying the pounds of Class I fluid milk products as
determined pursuant to Sec. 1304.1(a) of this chapter by the compact
over-order obligation.
PART 1307--PAYMENTS FOR MILK
1. The authority citation for Part 1307 continues to read as
follows:
Authority: 7 U.S.C. 7256.
2. Revise the introductory text of Sec. 1307.2 to read as follows:
Sec. 1307.2 Handlers' producer-settlement fund debits and credits.
On or before the 13th day after the end of the month, the compact
commission shall render a statement to each handler showing the amount
of the handler's producer-settlement fund debit or credit, as
calculated in this section.
* * * * *
3. Revise Sec. 1307.3 to read as follows:
Sec. 1307.3 Payments to and from the producer-settlement fund.
(a) On or before the 15th day after the end of the month, each
handler shall pay to the compact commission the handler's producer-
settlement fund debit for the month as determined under Sec. 1307.2(a).
(b) On or before the 16th day after the end of the month, the
compact commission shall pay to each handler the handler's producer-
settlement fund credit for the month as determined under
Sec. 1307.2(b). If the unobligated balance in the producer-settlement
fund is insufficient to make such payments, the compact commission
shall reduce uniformly such payments and shall complete them as soon as
the funds are available.
4. Revise Sec. 1307.5 paragraph (a) to read as follows:
Sec. 1307.4 Payments to producers.
(a) For milk received during the month, payment shall be made so
that it is received by each producer no later than the day after the
payment date required in Sec. 1307.3(b). Each handler shall make
payment to each producer for the milk received from him during the
month at not less than the basic over-order producer price per
hundredweight computer under Sec. 1306.3. If the handler has not
received full payment for the compact commission under Sec. 1307.3(b)
by the date payments are due under this paragraph, he may reduce pro
rata his payments to producers by an amount not to exceed such
underpayment. Such payments shall be completed after receipt of the
balance due from the compact commission by the next following date for
making payments under this paragraph.
* * * * *
5. Revise Sec. 1307.7 to read as follows:
Sec. 1307.7 Adjustment of accounts.
(a) Whenever the compact commission verification of a handler's
reports or payments discloses an error in payments to or from the
compact commission under Sec. 1307.3 or Sec. 1308.1, the compact
commission shall promptly issue to the handler a charge bill or a
credit, as the case may be, for the amount of the error. Adjustment
charge bills issued during the period beginning with the 10th day of
the prior month and ending with the 9th day of the current month shall
be payable by the handler to the compact commission on or before the
15th day of the current month. Adjustment credits issued during that
period shall be payable by the compact commission to the handler on or
before the 16th day of the current month.
(b) Whenever the compact commission's verification of a handler's
payments discloses payment to a producer or a cooperative association
of an amount less than is required by Sec. 1307.4, the handler shall
make payment of the balance due the producer not later than the 16th
day after the end of the month in which the handler is notified of the
deficiency.
6. Revise Sec. 1307.8 to read as follows:
Sec. 1307.8 Charges on overdue accounts.
Any unpaid obligation due the compact commission from a handler
pursuant to 7 CFR parts 1307 and 1308 shall be increased 1.0 percent
each month beginning with the day following the date such obligation
was due. Any remaining amount due shall be increased at the same rate
on the corresponding day of each succeeding month until paid. The
amounts payable pursuant to this section shall be computed monthly on
each unpaid obligation and shall include any unpaid
[[Page 1829]]
charges previously computed pursuant to this section. The late charges
shall accrue to the administrative assessment fund. For the purpose of
this section, any obligation that was determined at a date later than
prescribed by 7 CFR parts 1307 and 1308 because of a handler's failure
to submit a report to the compact commission when due shall be
considered to have been payable by the date it would have been due if
the report had been filed when due.
7. Add a new Sec. 1307.9 to read as follows:
Sec. 1307.9 Dates.
If a date required for payment contained in 7 CFR parts 1307 and
1308 falls on a Saturday, Sunday, or national holiday, such payment
will be due on the next day that the compact commission office is open
for public business.
PART 1308--ADMINISTRATIVE ASSESSMENT
1. The authority citation for Part 1308 continues to read as
follows:
Authority: 7 U.S.C. 7256.
2. Revise the introductory text of Sec. 1308.1 to read as follows:
Sec. 1308.1 Assessment for pricing regulations administration.
On or before the 15th day after the end of the month, each handler
shall pay to the compact commission his pro rata share of the expense
of administration of this pricing regulation. The payment shall be at
the rate of 3.2 cents per hundredweight. The payment shall apply to:
* * * * *
Dated: January 6, 2000.
Kenneth M. Becker,
Executive Director.
[FR Doc. 00-687 Filed 1-11-00; 8:45 am]
BILLING CODE 1650-01-P
