[Federal Register Volume 60, Number 145 (Friday, July 28, 1995)]
[Proposed Rules]
[Pages 38766-38767]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-18552]
========================================================================
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.
========================================================================
Federal Register / Vol. 60, No. 145 / Friday, July 28, 1995 /
Proposed Rules
[[Page 38766]]
DEPARTMENT OF AGRICULTURE
Consolidated Farm Service Agency
7 CFR Part 737
RIN 0560-AD92
Tobacco Warehouses
AGENCY: Consolidated Farm Service Agency, USDA.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: The Consolidated Farm Service Agency (CFSA) is proposing to
amend its regulations pertaining to licensed tobacco warehouses under
the United States Warehouse Act (USWA). The proposed rule would define
warehouse to exclude places which have contracted with a cooperative
marketing association (association) to make Commodity Credit
Corporation (CCC) price support advances to producers on behalf of the
association and to which producers will deliver their tobacco for
display and auction (hereinafter auction warehouses). Accordingly, the
proposed rule removes such places from the jurisdiction of the USWA
Tobacco Warehouse Regulations as provided for under 7 CFR part 737. The
proposed rule also makes changes with respect to package arrangement
and some clerical corrections.
DATES: Comments must be received by August 28, 1995 to be assured of
consideration.
ADDRESSES: Comments must be submitted to Acting Director, Warehouse and
Inventory Division (WID), CFSA, P.O. Box 2415, Washington, DC 20013-
2415, FAX 202-690-0014.
All submissions will be available for public inspection in room
5962, South Agriculture Building, U.S. Department of Agriculture, 14th
Street and Independence Avenue SW, Washington, DC, between 8 a.m. and 5
p.m., Monday through Friday, except holidays.
FOR FURTHER INFORMATION CONTACT: Steve Mikkelsen, Licensing Authority
Branch, WID, CFSA, P.O. Box 2415, Washington, DC 20013-2415; telephone
202-720-7433 or FAX 202-690-3123.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This proposed rule has been determined to be not significant and
was not reviewed by the Office of Management and Budget (OMB) under
Executive Order 12866.
Executive Order 12372
This program/activity is not subject to the provisions of Executive
Order 12372 which requires intergovernmental consultation with State
and local officials. See the Notice related to 7 CFR part 3015, subpart
V, published at 48 FR 29115 (June 24, 1983).
Executive Order 12778
This proposed rule has been reviewed in accordance with Executive
Order 12778. The provisions of this proposed rule do not preempt State
laws, are not retroactive, and do not involve administrative appeals.
Paperwork Reduction Act
The amendments set forth in this proposed rule do not generate any
new or revised information collection or recordkeeping requirements on
the public.
Regulatory Flexibility Act
It has been determined that the Regulatory Flexibility Act is not
applicable to this proposed rule, because it has been determined that
this rule will not have a significant effect on a substantial number of
small businesses. Licensing under the USWA is strictly voluntary on the
warehouse operator's part.
Environmental Evaluation
It has been determined by an environmental evaluation that this
action will not have significant impact on the quality of the human
environment. Therefore, neither an Environmental Assessment nor an
Environmental Impact Statement is needed.
Background
The purpose of this proposed rule is to remove tobacco auction
warehouses from coverage under the USWA and the regulations issued
thereunder (7 CFR part 737). The USWA, as amended (7 U.S.C. 241 et
seq.), provides that the Secretary of Agriculture may issue a license
for the conduct of public warehouses that store agricultural
commodities.
The USWA is implemented, as it pertains to tobacco warehouses, by
regulations at 7 CFR part 737 and is administered by CFSA.
Approximately, 1,500 entities hold licenses for storing eight different
agricultural commodities. Presently, there are six tobacco auction
warehouses licensed under the USWA.
In the tobacco industry, there are generally two types of tobacco
warehouses: (1) Long term storage warehouses and (2) tobacco auction
warehouses. The first type usually stores processed tobacco or raw
tobacco that has been chopped, placed in containers, and otherwise
prepared for long term storage. The second type receives raw tobacco
from producers and retains it for a limited period of time, generally
less than 30 days, until the tobacco is sold in an auction or
transferred to a tobacco association for placement under the CCC price
support program. Unlike a warehouse whose primary purpose is to store
processed tobacco for a long period of time, the primary purpose of an
auction warehouse is to market producer-owned tobacco. Presently, there
are approximately 400 tobacco auction warehouses.
The primary objectives of the USWA are to protect those who store
commodities in public warehouses; assure the integrity of warehouse
receipts as documents of title to be used as collateral; and set,
regulate, and maintain superior standards for said warehouse operators.
Because the auctioning of tobacco is a merchandising function, a
function which is not regulated by the USWA, the USWA and its
regulations, thereunder, were not intended to cover tobacco auction
warehouses. This proposed rule, however, does not affect the U.S.
Department of Agriculture's (USDA) other regulatory activity as it
applies to tobacco auction warehouses.
The primary functions of tobacco auction warehouses are currently
regulated by several USDA agencies. For example, tobacco auction
warehouses approved by the Agricultural Marketing Service (AMS) and
CFSA may sell producer-owned tobacco. AMS strictly regulates the manner
in which the tobacco must be stored, handled,
[[Page 38767]]
presented for sale, and graded for sale. See, 7 CFR part 29. Further,
the AMS regulations include detailed recordkeeping requirements.
Further, AMS has representatives, on-site, during all sales of tobacco.
In addition the Agricultural Adjustment Act of 1938, as amended,
and the Agricultural Act of 1949, as amended, strictly regulate the
sale of tobacco. CCC and CFSA regulate auction warehouses through the
Tobacco Marketing Quota and Price Support Programs they administer.
These regulations are codified at 7 CFR parts 723 and 1464. Under these
regulations, CCC and CFSA require that warehousemen retain detailed
records of all tobacco handled by them. The tobacco and the
transactions associated with it must be tracked and recorded from the
time the tobacco is brought into the warehouse by producers, to the
time it leaves the warehouse.
The type and level of regulation by AMS, CCC, and CFSA are unique
to auction warehouses. Producers who believe they have not been treated
fairly by the warehouseman may seek relief directly from the on-site
representatives of the various government agencies. If such allegations
are confirmed, under the provisions of 7 CFR parts 723 and 1464, CCC or
CFSA has the right to take appropriate actions against the tobacco
auction warehouse to protect the interests of producers. Accordingly,
because tobacco auction warehouses are (1) more involved with
merchandising (which is a non-USWA function) as opposed to the long
term storage of tobacco and (2) sufficiently regulated by other USDA
regulations, CFSA proposes to eliminate the application of the USWA and
its regulations to tobacco auction warehouses. This action further
reduces the amount of federal regulation.
List of Subjects in 7 CFR Part 737
Administrative practice and procedure, Agricultural Commodities,
Tobacco, Surety Bonds, Warehouses.
Accordingly, the provisions of 7 CFR part 737 are amended as
follows:
PART 737--TOBACCO WAREHOUSES
1. The authority citation for part 737 is revised to read as
follows:
Authority: 7 U.S.C. 268.
2. Section 737.2 is amended by revising the introductory text and
paragraphs (f), (i), and (j) to read as follows:
Sec. 737.2 Terms defined.
For the purposes of this part, unless otherwise provided, the
following terms shall mean:
* * * * *
(f) Service. The Consolidated Farm Service Agency of the U.S.
Department of Agriculture.
* * * * *
(i) Warehouse. Any suitable building, structure, or other protected
enclosure in which tobacco is, or may be, stored for interstate or
foreign commerce, or, if located within any place under the exclusive
jurisdiction of the United States, in which tobacco is, or may be,
stored and for which a license has been issued under the act except for
any place, including any suitable building, structure, or other
protected enclosure to which tobacco is delivered by the producers
thereof, or their agents for the purposes of obtaining CCC price
support advances and for the display and auction of tobacco.
(j) Warehouseman. Any person lawfully engaged in the business of
storing tobacco and holding a warehouse license.
* * * * *
3. Section 737.4 is amended by adding the following sentence at the
end of the paragraph:
Sec. 737.4 Grounds for not issuing license.
* * * Further, a license shall not be issued to any place to which
tobacco is delivered by the producers thereof, or their agents, for the
purposes of obtaining CCC price support advances and for the display
and auction of tobacco.
4. In Sec. 737.34 paragraph (a) is revised and paragraph (b) is
amended by adding a period after the word ``section'' and removing the
remainder of the paragraph.
Sec. 737.34 Package arrangement.
(a) Each warehouseman shall arrange the packages of warehoused
tobacco so that the identification number thereon as required by
Sec. 737.33 is visible, readily accessible, and shall arrange all
packages so as to permit an accurate check thereof, unless waived in
writing by the Administrator.
* * * * *
Sec. 737.50 [Amended]
5. Section 737.50 is amended by removing ``order of Agricultural
Marketing Service, USDA'', and by adding ``Service.''
Signed at Washington, DC, on July 24, 1995.
Bruce R. Weber,
Acting Administrator, Consolidated Farm Service Agency.
[FR Doc. 95-18552 Filed 7-27-95; 8:45 am]
BILLING CODE 3410-05-P
