99-32730. Guidelines for AMS Oversight of Commodity Research and Promotion Programs  

  • [Federal Register Volume 64, Number 242 (Friday, December 17, 1999)]
    [Notices]
    [Pages 70682-70686]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 99-32730]
    
    
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    Notices
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    Federal Register / Vol. 64, No. 242 / Friday, December 17, 1999 / 
    Notices
    
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    DEPARTMENT OF AGRICULTURE
    
    Agricultural Marketing Service
    [AMS-00-01]
    
    
    Guidelines for AMS Oversight of Commodity Research and Promotion 
    Programs
    
    AGENCY: Agricultural Marketing Service, USDA.
    
    ACTION: Notice; request for comment.
    
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    SUMMARY: The Department of Agriculture (USDA) is seeking comments on 
    the ``Guidelines for AMS Oversight of Commodity Research and Promotion 
    Programs'' (Guidelines). USDA's Agricultural Marketing Service (AMS) 
    developed the guidelines to facilitate uniform oversight of national 
    research and promotion programs which have been implemented under 
    numerous Federal statutes. The guidelines are part of the findings and 
    recommendations of the Research and Promotion Task Force (task force) 
    that was created by Secretary Glickman in November 1998. The task force 
    held a public meeting in March 1999 and held several working meetings 
    to review the oversight responsibilities of AMS and board operations.
    
    DATES: Comments must be received on or before March 17, 2000.
    
    FOR FURTHER INFORMATION CONTACT: Interested persons are invited to 
    submit written comments concerning this notice to: Barbara C. Robinson, 
    Deputy Associate Administrator, Room 3069 South Bldg., U.S. Department 
    of Agriculture, AMS, OA, Washington, DC 20250; telephone (202) 720-
    4276; fax (202) 690-3967. Comments should be submitted in triplicate 
    and will be made available for public inspection at the above address 
    during regular business hours. Comments may also be submitted 
    electronically to: public.comments@usda.gov. All comments should 
    indicate the docket number and the date and page number of this issue 
    of the Federal Register. A copy of this notice may be found at: 
    www.AMS.USDA.Gov/R&P/.
    
    SUPPLEMENTARY INFORMATION: This notice is authorized under the 
    following Federal statutes: the Beef Promotion and Research [7 U.S.C. 
    2901-2911]; the Canola and Rapeseed Research, Promotion, and Consumer 
    Information Act [7 U.S.C. 7441-7452]; the Commodity Promotion, 
    Research, and Information Act of 1996 [7 U.S.C. 7411-7425]; the Cotton 
    Research and Promotion Act [7 U.S.C. 2101-2118]; the Dairy Production 
    Stabilization Act of 1983 [7 U.S.C. 4501-4513]; the Egg Research and 
    Consumer Information Act [7 U.S.C. 2701-2718]; the Floral Research and 
    Consumer Information Act [7 U.S.C. 4301-4319]; the Fluid Milk Promotion 
    Act of 1990 [7 U.S.C. 6401-6417]; the Fresh Cut Flowers and Fresh Cut 
    Greens Promotion and Consumer Information Act [7 U.S.C. 6801-6814]; the 
    Honey Research, Promotion, and Consumer Information Act, as amended [7 
    U.S.C. 4601-4612]; the Lime Research, Promotion, and Consumer 
    Information Act, as amended [7 U.S.C. 6201-6212]; the Mushroom 
    Promotion, Research, and Consumer Information Act of 1990 [7 U.S.C. 
    6101-6112]; the National Kiwifruit Research, Promotion, and Consumer 
    Information Act [7 U.S.C. 7461-7473]; the Pecan Promotion and Research 
    Act of 1990 [7 U.S.C. 6001-6013]; the Popcorn Promotion, Research, and 
    Consumer Information Act [7 U.S.C. 7481-7491]; the Pork Promotion, 
    Research, and Consumer Information Act [7 U.S.C. 4801-4819]; the Potato 
    Research and Promotion Act, as amended [7 U.S.C. 2611-2627]; the Sheep 
    Promotion, Research, and Information Act of 1994 [7 U.S.C. 7101-7111]; 
    the Soybean Promotion, Research, and Consumer Information Act [7 U.S.C. 
    6301-6311]; the Watermelon Research and Promotion Act, as amended [7 
    U.S.C. 4901-4916]; and the Wheat and Wheat Foods Research and Nutrition 
    Education Act [7 U.S.C. 3401-3417].
        There are currently 13 active programs under these statutes: beef, 
    cotton, dairy, eggs, fluid milk, honey, mushrooms, peanuts, popcorn, 
    pork, potatoes, soybeans, and watermelons.
        AMS is seeking public comment on the Guidelines which have been 
    developed to promote uniformity in the oversight of these and any 
    future programs.
    
    Guidelines for AMS Oversight of Commodity Research and Promotion 
    Programs
    
    Table of Contents
    
    Introduction
    Purpose of Guidelines
    Administration
        Administrative Reviews
        Audits
        Board Administrative Expenses
        Board Meetings
        Board Member Orientation
        Board Travel and Meeting Expenses
        Bylaws and Policy Statements
        Compliance
        Investment of Funds
        Legal Counsel
        User Fees
    Budgets
    Conflict of Interest
    Contracts
        Competitive Bids
        Contract Approval
        Contract Compliance
    Diversity and Nominations
        Diversity on Boards
        Nominations
    Financial Accountability
    Influencing Legislation or Government Policy or Action
    Other Government Agencies
    Program Progress and Evaluation
    Promotional and Educational Materials
    Referendum Policies
        Bonds
        Influencing Voters
        Petitions for Referenda
        Referendum Ballots
        Refunds for Programs under the Generic Statute
    Appendix I: List of Industry-Specific Legislation
    
    Introduction
    
        National research and promotion programs are designed to strengthen 
    the position of a commodity in the marketplace, maintain and expand 
    existing domestic and foreign markets, and develop new uses and markets 
    for specified agricultural commodities. They are administered by the 
    U.S. Department of Agriculture's (USDA) Agricultural Marketing Service 
    (AMS) and funded by assessments collected from designated segments of 
    industry.
        Until 1996, industry-specific legislation had to be passed by 
    Congress before a national program could be established. (See Appendix 
    I.) However, under the Commodity Promotion, Research, and Information 
    Act of 1996 (generic statute), industry groups may
    
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    submit a proposal directly to AMS requesting that a program be 
    implemented. All programs require rulemaking and a referendum to 
    determine if those who pay assessments approve the programs.
        The programs are run by industry boards and councils (boards) 
    appointed by the Secretary of Agriculture (Secretary) from industry 
    nominations.
    
    Purpose of Guidelines
    
        These Guidelines are designed to facilitate the application of the 
    legislative and regulatory provisions of the acts and orders or plans 
    (orders), subject to the unique language of individual legislation as 
    determined by AMS. They are designed to promote uniformity in the 
    oversight of all commodity research and promotion programs. The 
    Guidelines shall be reviewed annually and amended as necessary.
    
    Administration
    
    Administrative Reviews
    
        To the extent practicable, AMS will conduct periodic administrative 
    reviews of board operations to ensure adherence to AMS policy. Selected 
    areas for examination will include, but not be limited to, travel 
    expenses of board members and staff, contract compliance, and 
    investment of funds. In general, boards should operate through an 
    appropriate set of oversight committees that deal with each board's 
    major budget items (see Budgets section of these Guidelines); board 
    members should be given adequate information on all significant 
    projects, proposals, issues, etc., and an outline of options for their 
    consideration in decision making; and the board and its committees 
    should document their decisions in an official set of minutes. Board 
    members must be given adequate information on ongoing operations to 
    allow the board to exercise appropriate management control. This can be 
    accomplished through a series of progress reports on ongoing activities 
    and accomplishment reports on completed activities.
    
    Audits
    
        Each board shall engage a certified public accountant (CPA) to 
    perform a comprehensive financial statement audit each year.
        These audits must be conducted in accordance with the Generally 
    Accepted Government Auditing Standards (GAGAS) prescribed by the 
    Comptroller General of the United States. Such an audit must cover the 
    financial statements specified in the Financial Accountability section 
    of these Guidelines and must include such procedures as are necessary 
    for the auditor to express an opinion on the financial statements and 
    such additional procedures as may be necessary for the auditor to 
    express an opinion on the board's internal control system and its 
    compliance with all applicable laws and regulations including the 
    program's enabling statute, the order which established the program, 
    and AMS policies and guidelines.
        AMS shall: (a) Review and approve each board's contract with its 
    CPA; (b) review and approve the details of the engagement between the 
    board and its CPA; (c) have the option of attending any entrance or 
    exit conference with the CPA; and (d) receive a copy of the CPA's audit 
    report and copies of all correspondence between the board and its CPA. 
    AMS officials will evaluate each audit report and may request 
    additional information if needed. Boards must promptly follow up on all 
    audit findings and auditor's recommendations and must fully inform AMS 
    of all such activity.
        If special circumstances arise, (e.g., a theft or loss of control 
    of board assets or a serious breakdown in internal controls), AMS may 
    require a board to engage a CPA to perform a one-time, focused review 
    to ascertain the causes and results of a problem and to make 
    recommendations for corrective or preventive action.
    
    Board Administrative Expenses
    
        Recognizing inherent differences in implementing laws or 
    regulations, scope, and funding among promotion programs, AMS expects 
    each board and state association or other organization, authorized by 
    law to receive assessment funding, to establish and maintain the 
    minimum level of annual administrative expenses necessary to 
    efficiently and effectively carry out the programs mandated by law. 
    Each board shall include its annual administrative expenses as a 
    separate item in its annual report. AMS or the board may require a 
    state association or other organization receiving board funds to report 
    its annual administrative expenses in a similar manner. Each board must 
    adhere to its fiduciary responsibilities and ensure that all monies are 
    spent wisely and in accordance with laws and regulations.
        The Secretary's costs for oversight of the commodity boards should 
    not be considered as an administrative expense of the boards as these 
    charges are outside of the boards' control and management.
        Pursuant to 7 U.S.C. 7401, Commodity Promotion and Evaluation, AMS 
    will annually provide to the Committee on Agriculture of the House of 
    Representatives and the Committee on Agriculture, Nutrition, and 
    Forestry of the Senate information on the administrative expenses of 
    each research and promotion board.
    
    Board Meetings
    
        AMS requires advance notification from the boards of all board and 
    committee meetings as well as conference calls. AMS will attend all 
    board meetings and participate in conference calls and committee 
    meetings when deemed necessary by AMS.
        In addition, it is important for boards to recognize that there are 
    many religious practices, and boards should keep this in mind when 
    scheduling meetings.
    
    Board Member Orientation
    
        AMS will participate in the orientation of new board members for 
    all programs. AMS will discuss USDA oversight responsibilities and 
    policies, including these Guidelines, so that new members can 
    understand and comply with them as well as the applicable statute and 
    order. AMS will require that all board members certify that they 
    understand the prohibition against using board funds to influence 
    legislation or government action or policy. The Office of the General 
    Counsel (OGC) will participate in the initial orientation of members of 
    new boards at the board's organizational meeting. OGC may participate, 
    at the request of AMS, in the orientation of new board members for 
    existing programs.
    
    Board Travel and Meeting Expenses
    
        Board members are not allowed a fee or compensation for board 
    service other than reimbursement for reasonable travel costs. However, 
    board members and employees (including staff contracted to perform 
    management and administrative services for a board) may be reimbursed 
    for reasonable and appropriate expenses.
        AMS will provide guidance for boards to develop a written policy, 
    approved by AMS, for travel and meeting expenses. In addition, boards 
    must have in place sufficient internal controls to prevent 
    reimbursements or expenditures for unreasonable and potentially 
    controversial travel and meeting expenses. Unreasonable and potentially 
    controversial travel and meeting expenses include, but are not limited 
    to, first class travel, member golf outings, and entertainment that 
    does not directly
    
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    further the purposes of the acts and orders.
        Boards are prohibited from using assessment funds for expenses for 
    spouses or other family members of board members or employees, open 
    bars, and adult entertainment.
    
    Bylaws and Policy Statements
    
        AMS will review for approval the bylaws and amendments to bylaws 
    developed by the boards and require boards to establish policies which 
    cover board member and staff responsibilities, meeting procedures, and 
    travel and related expenses.
    
    Compliance
    
        The respective boards are responsible for promptly identifying 
    violations and violators and for securing compliance with the statutes, 
    order, and rules and regulations wherever possible. AMS will develop 
    with each board requirements and a timetable for the referral of 
    compliance cases to AMS for appropriate action. Upon receipt of 
    compliance cases, AMS will take one or more of the following actions: 
    (1) Send a certified letter requesting compliance within a specified 
    period; (2) Utilize National Finance Center collection procedures, 
    including administrative offset; and/or (3) Refer violations to the OGC 
    for action. Before discharging any delinquent debt, AMS will take all 
    appropriate steps to collect such debt.
    
    Investments of Funds
    
        AMS shall require the boards to follow the AMS investment policy to 
    ensure proper investment of board funds.
    
    Legal Counsel
    
        OGC will provide all legal counsel to the boards, except as may be 
    provided for under a Memorandum of Understanding (MOU) between a board 
    and OGC. OGC will review all existing MOU's and recommend any needed 
    changes to ensure consistency among the boards.
    
    User Fees
    
        The authorizing legislation for each program requires the various 
    boards to reimburse AMS for its costs in overseeing the programs. It is 
    the policy of AMS that all of these programs be charged in a fair and 
    equitable manner and that all costs be covered.
        All direct program costs should be charged to the appropriate 
    program. These costs include salaries and benefits of employees 
    directly involved in the daily workload associated with commodity 
    boards. Other costs would be travel to board meetings, rent for office 
    space for the employees directly working on the programs, printing of 
    any documents, supplies, equipment, and anything else needed to 
    complete the necessary work involved in overseeing the programs.
        Direct program costs, including costs billed to AMS by other USDA 
    and government agencies for authorized services provided in the support 
    of the various boards, will be charged to the appropriate board. In 
    addition, costs billed to AMS by states for actual unemployment claims 
    paid to former board employees will be charged to the appropriate board 
    when the bills are received by AMS.
        The cost of agency overhead should also be charged to the boards. 
    Overhead includes those costs incurred by the agency, the respective 
    Deputy Administrator, and other offices involved in board oversight. 
    These costs should be distributed in proportion to the direct program 
    cost. In order to ensure that these costs are readily available for 
    billing, internal AMS distributive subcenters should include a 
    percentage charge for each program. As an option, depending on the 
    organization levels involved in supervision of the boards and the 
    amount of oversight provided, Deputy Administrator charges may be 
    included in direct costs. The cost of agency overhead for the oversight 
    of the boards is also charged to the boards.
    
    Budgets
    
        AMS will review for approval board-submitted budgets prior to the 
    start of the board's fiscal year. When submitting budgets to AMS, the 
    boards must include detailed information regarding administrative 
    expenses and a written description of contract costs. Budget 
    submissions must include, at a minimum, the following components:
        (1) A statement of objectives and strategy in each major program 
    area (promotion, advertising, research, etc.), including reasons for 
    significant changes from the preceding budget period.
        (2) A summary of anticipated revenue (assessments, interest, 
    donations, etc.) and anticipated refunds, where applicable, with 
    comparative data for at least one preceding year.
        (3) A summary of proposed expenditures by major program areas with 
    comparative data for at least one preceding year.
        (4) Staff and administrative expense breakdown, with comparative 
    data for at least one preceding year.
        AMS will review for approval amendments or additions to approved 
    budgets, including shifting of program funds from one major area to 
    another. Shifts that are consistent with governing bylaws need not have 
    prior approval by AMS.
    
    Conflict of Interest
    
        AMS will provide guidance to assist boards in developing written 
    policies to safeguard against and deal with conflict of interest 
    situations, and such policies will be reviewed and approved by AMS. 
    These policies shall include, at a minimum, the requirements that: (1) 
    Board members and employees must disclose any relationship with any 
    organization or company that has a contract with the board or that 
    operates a qualified state or regional program and (2) No board member 
    may vote on any matter in which the member has a financial interest, or 
    regarding any contract with any entity of which the member is a member 
    of the board.
        In addition, each board should ensure that its responsibilities and 
    duties have not been delegated or otherwise relinquished to another 
    organization.
        Programs issued under the generic statute shall comply with the 
    conflict of interest provisions of that statute.
    
    Contracts
    
    Competitive Bids
    
        Boards must follow sound business principles and practices in 
    awarding contracts. Fundamental elements of good contracting are the 
    identification of realistic alternates and the use of competitive 
    bidding procedures. AMS believes it is each board's responsibility to 
    incorporate these principles and practices into its operation 
    procedures. Accordingly, each board must (1) develop an acquisition 
    plan that specifies its processes for identifying alternative sources 
    and obtaining competitive bids and (2) assign to a board committee the 
    responsibility for monitoring contracting practices. These practices 
    should also be reviewed regularly by the board's CPA.
        The principles applied in awarding board contracts must also be 
    followed by those contractors in awarding subcontracts.
        If competitive bidding is not used, a reason for not doing so will 
    be stated and placed in the board's contract file along with an 
    alternative process to verify the reasonableness of the cost.
        None of the requirements stated here shall be interpreted to (1) 
    prohibit multi-year contracting or (2) require boards to select the 
    lowest cost bidder when, in the board's judgment, other factors are 
    deemed more important.
    
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    Contract Approval
    
        AMS will review for approval written contracts for the development 
    and carrying out of programs or projects of promotion, advertising, 
    development, or education and written contracts for legal assistance 
    and other consultants. AMS will review contracts for conformance with 
    the applicable statutes and regulations and with AMS and USDA 
    requirements. Contracts must include a provision prohibiting the use of 
    assessment funds for lobbying activities. Contracts must be approved 
    prior to the start of activities to be carried out under the contract. 
    AMS will require boards to formally notify potential contractors that 
    any work they undertake prior to contract approval by USDA is at their 
    own risk as boards are not financially liable if the contract is not 
    approved by USDA. AMS reserves the right to review for approval any and 
    all contracts and subcontracts and to require AMS prior approval of any 
    such contracts.
        When a board relies heavily on its industry trade association in 
    carrying out its program, there must be highly effective ``fire walls'' 
    between board activities and other activities of the trade association. 
    These fire walls should include: (1) Completely separate accounting 
    systems and thorough segregation of board funds from trade association 
    funds, all of which should be audited each year by the board's 
    independent CPA; (2) Careful computation and documentation of the trade 
    association's overhead or indirect charges to the board, supported by 
    strict recordkeeping; and (3) Strict policies on what the trade 
    association may and may not do with checkoff funds.
    
    Contract Compliance
    
        Boards are responsible for ensuring compliance by the contractors 
    and subcontractors with the terms of their contracts.
    
    Diversity and Nominations
    
    Diversity on Boards
    
        It is USDA policy that membership on industry-governed boards and 
    committees accurately reflect, to the extent practicable, the diversity 
    of individuals served by the programs. Diversity includes the size of 
    operation, segment of the industry, and geographical distribution as 
    well as gender, ethnicity, race, and disability.
    
    Nominations
    
        To facilitate the nomination of individuals to serve as members of 
    boards and nominating entities, AMS will work with the boards to 
    establish time frames to seek to avoid bottlenecks in the clearance 
    process within USDA. Boards are urged to provide, to the extent 
    possible, statements to nominating entities that ``all nominees must be 
    in good standing with Department of Agriculture programs.'' AMS will 
    also include this statement in news releases and other publicity 
    announcing nominations for boards and nominating entities.
    
    Financial Accountability
    
        Each board must maintain a comprehensive financial accounting 
    system and must maintain and make available to USDA representatives, on 
    request, all appropriate books and records.
        Each board must prepare a comprehensive set of annual financial 
    statements. These statements, which must be prepared in accordance with 
    generally accepted accounting principles, should include:
        (1) a balance sheet;
        (2) a statement of revenues and expenses;
        (3) a statement of changes in fund balance;
        (4) a statement of cash flows;
        (5) a schedule, showing the following in three columns and 
    containing footnotes explaining any significant variances: (a) The 
    USDA-approved budget (plan) by each major category; (b) The annual 
    expenditures against each budget category (actual); and (c) and 
    variances between planned and actual expenditures; and
        (6) any other financial statements, schedules, or explanations as 
    may be requested by the board or USDA to provide sufficient information 
    for effective management, monitoring, or decision making.
        Where refunds are applicable, the financial records should include 
    all appropriate details on assessments paid, requests for refunds, and 
    refunds issued.
    
    Influencing Legislation or Government Policy or Action
    
        In the process of monitoring board activities, it is important for 
    AMS to be aware of any actions which may be in conflict with the 
    legislative prohibitions regarding influencng legislative and/or 
    government policy. This prohibition on the use of check-off funds 
    applies equally to any trade/producer organizations funded wholly or in 
    part by a particular board or contractors to the boards.
        However, this does not affect a trade/producer organization's 
    ability to lobby with non-check-off funds. Likewise, there are no 
    restrictions on individual board members, except when acting in an 
    official capacity for the board.
        Influencing legislation is defined as (1) any attempt to influence 
    any legislation or any attempt to affect the opinions of the general 
    public or any segment thereof concerning legislation; or (2) any 
    attempt to influence any legislation through communication with any 
    member or employee of a legislative body or with any governmental 
    official who may participate in the formulation of legislation.
        Influencing of governmental policy or action is defined as any 
    action the principal purpose of which is to bring about a change in 
    existing policy or regulation or affect the outcome of proposed policy 
    or regulation, except those actions which are specifically provided for 
    in the act, order, and/or rules and regulations. Exceptions: With the 
    approval of the Secretary, a board may request a ceremonial government 
    action, such as the proclamation of a state or national month for the 
    commodity it represents, and may provide information to USDA regarding 
    government purchases of the commodity it represents.
        These prohibitions do not preclude commodity boards from providing 
    factual information to government officials, provided the information 
    is presented in an unbiased manner and does not advocate a specific 
    course of action.
        AMS will require each board member to acknowledge in writing that 
    the person understands the prohibition on using assessment funds for 
    lobbying or attempting to influence legislation, government action or 
    government policy, and agrees to act in accordance with that 
    prohibition.
    
    Other Government Agencies
    
        AMS will be responsible for developing appropriate working 
    relationships with other government agencies which have 
    responsibilities related to these programs. For example, AMS will be 
    responsible for ensuring close coordination with the FAS any time 
    check-off funds are used for foreign activities. FAS has oversight 
    responsibility of the Foreign Market Development and the Market Access 
    Programs, and checkoff funding is made available to some participants 
    in these FAS supervised programs. However, in all cases, FAS must have 
    the opportunity to approve the boards' budgets, plans, and projects 
    that focus on international activities. FAS approval will be subject to 
    compliance with the checkoff legislation as well as other FAS 
    requirements. Likewise, for programs with import assessment provisions, 
    it is the responsibility of AMS to maintain a close liaison with
    
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    the U.S. Customs Service. Similarly, as required by section 1999T of 
    the Food, Agriculture, Conservation, and Trade Act of 1990, AMS will 
    consult with the United States Trade Representative on any proposed new 
    or amended commodity promotion order which would assess imports.
    
    Program Progress and Evaluation
    
        AMS will receive copies of annual progress reports on program 
    activities and expenditures.
        Not less often than every five years, each board shall obtain an 
    independent evaluation of the effectiveness of its generic promotion 
    program. Each board shall submit to the Secretary and make available to 
    the public the results of each periodic independent evaluation.
        The methodology of the results must be credible, shareholder 
    returns must be estimated, and the results must be presented in non-
    technical terms. Ideally, each board will commission econometric 
    studies or other formal statistical models which would be subject to 
    peer review. However, AMS recognizes differences in the availability of 
    data and financial resources among the various boards. Therefore, other 
    types of evaluation may also be used to meet the requirement to conduct 
    periodic evaluations. Other types of evaluation include, but are not 
    limited to, focus group interviews, Nielson and Gallup polls, National 
    Eating Trend data, and supermarket scanning data. Boards which do not 
    conduct econometric evaluations are required to submit their evaluation 
    plans to AMS for review and comment.
    
    Promotional and Educational Materials
    
        AMS will review all plans and projects of commodity boards and 
    approve those that are in compliance with the applicable legislative 
    authority.
        AMS will disapprove any advertising that it considers to be 
    disparaging to another commodity or false and misleading. AMS will also 
    disapprove any promotional material that it deems derogatory to 
    individuals with respect to ethnicity, gender, race, physical 
    abilities, or religion. The commodity programs may refer any 
    questionable advertisements to the AMS Functional Committee on Research 
    and Promotion Programs for review and for its recommendation.
        Each board shall regularly provide to AMS all commodity promotional 
    campaigns--advertising, consumer education programs, and other 
    promotional materials for review and approval and the advertisements or 
    printed materials generated in the campaign.
        AMS review of nutritional claims will include verification of the 
    supporting data to determine compliance with USDA Agricultural Handbook 
    8-1, the Dietary Guidelines for Americans, Federal Trade Commission 
    policy, Food and Drug Administration food labeling regulations, and 
    other applicable Federal regulations.
    
    Referendum Policies
    
    Bonds
    
        AMS will require the proponent of a new program to post a bond or 
    submit an irrevocable letter of credit to cover any up-front referendum 
    and other implementation costs.
    
    Influencing Voters
    
        Boards, board members, and board employees acting in their official 
    capacities are prohibited from attempting to influence voters, and no 
    board funds may be expended for that purpose. Board funds may not be 
    used to state a position for or against a referendum issue or a 
    petition or to promote a ``yes'' or a ``no'' vote in a referendum.
        During period of referenda, requests for referenda, polls, or any 
    petition process, however, board funds may be used: (1) For 
    communication activities to inform industry how checkoff dollars are 
    being spent and (2) to provide unbiased factual information concerning 
    the referendum, poll, or petition process. Board funds may also be used 
    to encourage those covered by a program to exercise their right to 
    vote.
    
    Petitions for Referenda
    
        All of the statutes provide some type of mechanism for industry to 
    request a referendum to determine if an individual program should be 
    terminated. The most common requirement is that the Secretary must hold 
    a referendum at the request of 10 percent or more of the persons who 
    are covered by the program.
    
    Referendum Ballots
    
        Unless another method is required by statute, AMS will conduct all 
    referenda by mail ballot, fax, or electronic means (when proper 
    safeguards are in place). Further, in order to facilitate the 
    verification of voter eligibility and the validity of ballots cast in 
    referenda, the voters' name, address, telephone number, and 
    certification will not be separated from the vote. All referenda 
    includes referenda on implementing, continuing, amending, suspending, 
    or terminating national research and promotion programs.
    
    Refunds for Programs Under the Generic Statute
    
        When a new program is implemented with a delayed referendum and 
    refunds of assessments are required if the industry votes to terminate 
    the program:
        (1) boards must disseminate procedures for receiving refunds to all 
    persons subject to assessments under the program in a timely manner;
        (2) boards, board members, and board employees may not exert 
    pressure of any kind to discourage the application for refunds;
        (3) the names of individuals applying for or obtaining refunds must 
    be kept confidential and made available only to appropriate staff 
    personnel; and
        (4) refund information released will be limited to the aggregate 
    dollar amount and the number of persons receiving refunds by State, 
    region, or nationwide. No information may be released that would in any 
    way readily identify individual persons or firms.
    
    Appendix I--Industry-Specific Legislation
    
    Legislation for Current Programs
    
    Beef Promotion and Research Act (1985)
    Cotton Research and Promotion Act (1996)
    Dairy Production Stabilization Act (1983)
    Egg Research and Consumer Information Act (1974)
    Fluid Milk Promotion Act of 1990
    Honey Research Promotion and Consumer Information Act of 1984)
    Mushroom Promotion, Research and Consumer Information Act of 1990
    Popcorn Promotion, Research, and Consumer Information Act of 1996
    Pork Promotion, Research, and Consumer Information Act of 1985
    Potato Research and Promotion Act (1971)
    Soybean Promotion, Research, and Consumer Information Act of (1990)
    Watermelon Research and Promotion Act (1985)
    
    Other Legislation
    
    Canola and Rapeseed Research, Promotion, and Consumer Information 
    Act of (1996)
    Floral Research and Consumer Information Act of (1981)
    Fresh Cut Flowers and Fresh Cut Greens Promotion and Information Act 
    of 1993
    Lime Research, Promotion and Consumer Information Act of 1990
    National Kiwifruit Research, Promotion, and Consumer Information Act 
    (1996)
    Pecan Promotion and Research Act of 1990
    Sheep Promotion, Research and Information Act of 1994
    Wheat and Wheat Foods Research and Nutrition Education Act (1977)
    
        Dated: December 14, 1999.
    Kathleen A. Merrigan,
    Administrator, Agricultural Marketing Service.
    [FR Doc. 99-32730 Filed 12-15-99; 12:00 pm]
    BILLING CODE 3410-02-P
    
    
    

Document Information

Published:
12/17/1999
Department:
Agricultural Marketing Service
Entry Type:
Notice
Action:
Notice; request for comment.
Document Number:
99-32730
Dates:
Comments must be received on or before March 17, 2000.
Pages:
70682-70686 (5 pages)
Docket Numbers:
AMS-00-01
PDF File:
99-32730.pdf