[Federal Register Volume 63, Number 228 (Friday, November 27, 1998)]
[Proposed Rules]
[Pages 65563-65565]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-31588]
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Proposed Rules
Federal Register
________________________________________________________________________
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. 63, No. 228 / Friday, November 27, 1998 /
Proposed Rules
[[Page 65563]]
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NORTHEAST DAIRY COMPACT COMMISSION
7 CFR Chapter XIII
Over-Order Price Regulation
AGENCY: Northeast Dairy Compact Commission.
ACTION: Notice of Proposed Rulemaking Proceedings.
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SUMMARY: The Northeast Dairy Compact Commission is seeking testimony
and comments on specific subjects and issues related to: Whether to
amend the formula for distribution of monies from the producer-
settlement fund, including whether to adopt a cap on the amount of
milk, per producer, eligible for the Compact Over-order producer price;
whether additional supply management policies and provisions should be
incorporated into the Over-order Price Regulation; whether organic milk
should be exempted from the Compact Over-order Price Regulation; and
whether the amount of, or method for determining, the administrative
assessment should be amended.
DATES: See Supplementary Information section for public hearing dates
and filing dates for pre-filed testimony and written comments and
exhibits.
ADDRESSES: Mail, or deliver, pre-filed testimony, comments and exhibits
to: Northeast Dairy Compact Commission, 43 State Street, P.O. Box 1058,
Montpelier, Vermont 05601. See Supplementary Information section for
public hearing locations.
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. Public Hearing Dates, Times and Locations; Filing Dates for
Written Comments
The public hearing dates and locations are:
1. December 11, 1998, 9:00 a.m. to 12:00 p.m., at the Holiday Inn
at Boxborough Woods, Parade Room, 242 Adams Place, Boxborough, MA,
public hearing on administrative assessment.
2. December 11, 1998, 1:00 p.m. to 4:00 p.m., at the Holiday Inn at
Boxborough Woods, Parade Room, 242 Adams Place, Boxborough, MA public
hearing on income distribution and supply management.
3. December 16, 1998, 9:00 to 12:00 p.m., at the Tuck Library
Building, Chubb Auditorium, 30 Park Street, Concord, NH public hearing
on organic milk.
4. Pre-filed testimony is encouraged and may be submitted to the
Northeast Dairy Compact Commission at the address in the ADDRESSES
section by 12:00 p.m. December 7, 1998.
5. Written comments and exhibits may be submitted until 5:00 p.m.
December 31, 1998.
II. Background
The Northeast Dairy Compact Commission initially promulgated an
Over-order Price Regulation on May 30, 1997.1 The regulation
was subsequently amended generally and extended on November 25,
1997.2 Over the past year, the Commission also has amended
specific provisions of the Over-order Price Regulation.3 The
Commission is now seeking testimony and comment on specific subjects
and issues related to (1) whether to amend the formula for distribution
of monies from the producer-settlement fund, including whether to adopt
a cap on the amount of milk, per producer, eligible for the Compact
Over-order producer price; (2) whether additional supply management
policies and provisions should be incorporated into the Over-order
Price Regulation; (3) whether organic milk should be exempted from the
Compact Over-order Price Regulation; and (4) whether the amount of, or
method for determining, the administrative assessment should be
amended.
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\1\ 62 FR 29626 (May 30, 1997).
\2\ 62 FR 62810 (November 25, 1997).
\3\ 63 FR 10104 (Feb. 27, 1998); 63 FR 46385 (Sept. 1, 1998);
and the most recent amendment is published elsewhere in this issue
of the Federal Register.
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III. Statement of Subjects and Issues
(1) Income Distribution From the Producer-Settlement Fund
The Massachusetts delegation to the Compact Commission petitioned
the Commission to consider a policy change that would alter the income
distribution provisions of the current Over-order Price Regulation by
placing a cap on the amount of milk, per producer, that would be
eligible to receive the Compact Over-order producer price.
(2) Supply Management Policies
Article IV, Section 9(f) of the Compact requires the Commission to
``take such action as necessary and feasible to ensure that the over-
order price does not create an incentive for producers to generate
additional supplies of milk.'' The Commission's Committee on
Regulations and Rulemaking previously held five public meetings to
receive informal public comment on various supply management proposals
that are consistent with the Commission's Section 9(f)
responsibilities. The Commission also recently promulgated a
regulation, effective January 1, 1999, that will limit the payment of
the Compact Over-order producer price to milk disposed of within the
Compact regulated area, with a seasonally adjusted allowance for
diverted and transferred milk.4 The Commission now seeks
formal public comment on whether any additional supply management
policies and provisions should be incorporated into the Over-order
Price Regulation.
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\4\ As published elsewhere in this issue of the Federal
Register.
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(3) Organic Milk
Organic milk handlers have petitioned the Commission to consider
exempting organic milk from the Compact Over-order Price Regulation.
(4) Administrative Assessment
The Commission determined that it would benefit from comments and
testimony regarding whether the amount of, or method for determining,
the administrative assessment should be amended. The current
administrative assessment regulation was promulgated with the initial
price regulation on May 30, 1997.5 The November 25, 1997
extension of the price regulation
[[Page 65564]]
maintained the administrative assessment.6 In addition to
comments on the specific proposals, discussed below, to address the
identified subjects and issues, the Commission also would welcome
comments, suggestions, and recommendations for other policies or
methods for addressing the issues of income distribution, supply
management, organic milk and the administrative assessment.
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\5\ 62 FR 29626, codified at (7 CFR 1308.1).
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IV. Specific Proposals
The Commission seeks comment and analysis of the following
proposals. (A comparison chart of the producer payments under the
current price regulation and the impact of the main income distribution
proposals, discussed at sections 1 and 2 below, is provided at Table 1
to facilitate comment and analysis of the various proposals.) The
Commission specifically requests comments regarding the effectiveness
of each of these proposals in light of the Commission's mission to
assure the continued viability of dairy farming in the northeast, and
to assure consumers of an adequate, local supply of pure and wholesome
milk.
1. The Massachusetts Cap Proposal
This proposal would limit the milk eligible for the Compact Over-
order producer price to up to 95,000 pounds of a producer's monthly
milk production, or 1.14 million pounds per year. This proposal would
not provide any Compact Over-order producer price for milk produced in
excess of the cap.
2. Split Pool Proposal
A split pool also would address the income distribution aspects of
the Over-order Price Regulation. Under this proposal, a certain
percentage of the total value of the monthly producer pool would be
divided equally among all qualified farms supplying the New England
market, regardless of farm size. The balance of the pool would be paid
out on a per hundredweight basis, as it is under the current
regulation. For example, the pool could be divided to distribute the
first 55% of the pool on a per farm basis and distribute the remaining
45% of the pool on a per hundredweight basis. An alternate proposal
would be to distribute the first 25% of the pool on a per farm basis
and distribute the remaining 75% on a per hundredweight basis.
Table 1.--Comparison of Various Proposals
[July 1998]
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55%/45% split 25%/75% split
No. of cows Lbs. Actual compact 95,000 CAP (dollars) (dollars)
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12............................. 20,000 238 422 986 577
18............................. 30,000 357 633 1,037 665
29............................. 50,000 595 1,055 1,139 841
41............................. 70,000 833 1,477 1,241 1,017
56............................. 95,000 1,131 2,005 1,369 1,237
58............................. 100,000 1,190 2,005 1,394 1,281
64............................. 110,000 1,309 2,005 1,445 1,369
70............................. 120,000 1,428 2,005 1,496 1,457
76............................. 130,000 1,547 2,005 1,547 1,539
82............................. 140,000 1,666 2,005 1,598 1,633
88............................. 150,000 1,785 2,005 1,649 1,721
94............................. 160,000 1,904 2,005 1,700 1,809
99............................. 170,000 2,023 2,005 1,751 1,897
105............................. 180,000 2,142 2,005 1,802 1,985
111............................. 190,000 2,261 2,005 1,853 2,073
117............................. 200,000 2,380 2,005 1,904 2,161
123............................. 210,000 2,499 2,005 1,955 2,249
129............................. 220,000 2,618 2,005 2,006 2,337
135............................. 230,000 2,737 2,005 2,057 2,425
146............................. 250,000 2,975 2,005 2,159 2,601
175............................. 300,000 3,570 2,005 2,414 3,041
205............................. 350,000 4,165 2,005 2,669 3,481
234............................. 400,000 4,760 2,005 2,924 3,921
264............................. 450,000 5,355 2,005 3,179 4,361
292............................. 500,000 5,950 2,005 3,434 4,801
351............................. 600,000 7,140 2,005 3,944 5,681
400............................. 700,000 8,330 2,005 4,454 6,561
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3. Proposal To Cap the Largest Producers
This proposal would set a cap on the amount of milk, per producer,
eligible for the Over-order producer price, but at a level much higher
than under the Massachusetts proposal discussed in section 1 above.
Under this proposal, the cap for all farms producing more than 600,000
pounds per month would be set at the 1998 production level.
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\6\ 62 FR 62810 (Nov. 25, 1997).
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4. Refund/Assessment Option
This proposal would establish an assessment on all milk during the
year at some percentage of each month's producer pool. The assessment
would be held in escrow and returned to eligible producers at some
frequency, e.g. annually, semi-annually or quarterly. Producers would
be eligible for a refund from the assessment only if they document that
they did not increase production during the relevant time period. The
Commission would welcome comments regarding the level to set the
assessment percentage to ensure an effective supply management result.
5. Exemption of Organic Milk From the Compact Over-Order Price
Regulation
This proposal would exempt organic milk handlers from the Compact
Over-order Obligation and exclude organic milk producers from the
producer pool.
[[Page 65565]]
6. Amendment of the Administrative Assessment Regulation
The current administrative assessment regulation, 7 CFR 1308.1,
establishes a set rate of 3.2 cents per hundredweight of fluid milk as
determined under 7 CFR 1306. This assessment is due monthly from all
handlers regulated under the Over-order price regulation. The
Commission seeks testimony and comments on whether the amount of the
administrative assessment, or the method for determining the
administrative assessment, should be amended.
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 hearings on December 11 and December 16, 1998, 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.
Request for Pre-filed Testimony and 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 5:00 p.m. on
December 31, 1998. 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 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 5:00 p.m. deadline, but the original must then
be sent by ordinary mail.
The Commission is requesting pre-filed testimony from any
interested person. Pre-filed testimony must include the name, address
and occupation of the witness and a sworn notarized statement
indicating that the testimony is presented based upon the author's
personal knowledge and belief. Pre-filed testimony must be received in
the Commission office no later than 12:00 p.m. December 7, 1998 to
ensure distribution to Commission members prior to the public hearings.
Pre-filed testimony, comments and exhibits should be sent to:
Northeast Dairy Compact Commission, 43 State Street, P.O. Box 1058,
Montpelier, Vermont 05601 or by facsimile to (802) 229-2028.
Dated: November 19, 1998.
Dixie L. Henry,
General Counsel.
[FR Doc. 98-31588 Filed 11-25-98; 8:45 am]
BILLING CODE 1650-01-P
