[Federal Register Volume 59, Number 168 (Wednesday, August 31, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-21509]
[[Page Unknown]]
[Federal Register: August 31, 1994]
VOL. 59, NO. 168
Wednesday, August 31, 1994
DEPARTMENT OF AGRICULTURE
Commodity Credit Corporation
7 CFR part 1425
RIN 0560-AD70
Cooperative Marketing Associations; Eligibility Requirements for
Price Support
AGENCY: Commodity Credit Corporation, USDA.
ACTION: Proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: The Commodity Credit Corporation (CCC) is proposing to amend
the regulations governing the participation of cooperative marketing
associations (CMA) in CCC price support programs to ensure: the
equitable treatment of CMA members and individual producers; the
Government does not accept undue risk in providing CMA price support
program benefits; and the efficient delivery of CMA price support
program benefits. This proposed rule: changes CMA bylaw requirements to
reflect current CMA organizational and operational procedures; requires
approved cotton CMA retention of services provided by servicing agent
banks; requires approved CMA monitoring of payments they receive on
behalf of their members to ensure that member payments do not exceed
payment limits; and makes other administrative changes.
DATES: Written comments must be received on or before September 30,
1994 in order to be assured of consideration.
ADDRESSES: Send comments to Director, Cotton, Grain, and Rice Price
Support Division, Agricultural Stabilization and Conservation Service
(ASCS), U.S. Department of Agriculture (USDA), P.O. Box 2415,
Washington, DC 20013-2415.
FOR FURTHER INFORMATION CONTACT: Richard M. Ackley, Chief, Cooperative
and Analysis Branch; Cotton, Grain, and Rice Price Support Division,
ASCS, USDA, P.O. Box 2415, Washington, DC 20013-2415.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This proposed rule has been determined to be significant for
purposes of Executive Order 12866 and, therefore, has been reviewed by
OMB.
Federal Assistance Program
The title and number of the Federal Assistance Program, as found in
the Catalog of Federal Domestic Assistance, to which this rule applies
are Commodity Loans and Purchases--10.051.
Regulatory Flexibility Act
It has been determined that the Regulatory Flexibility Act is not
applicable because CCC is not required by 5 U.S.C. 553 or any other
provision of law to publish a notice of proposed rulemaking with
respect to the subject matter of these determinations.
Environmental Evaluation
It has been determined by an environmental evaluation that this
action will have no significant impact on the quality of human
environment.
Executive Order 12372
This program 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,
into Federal Register at 48 FR 29115 (June 24, 1983).
Executive Order 12778
This proposed rule has been reviewed pursuant to Executive Order
12778. To the extent State and local laws are in conflict with these
regulatory provisions, it is the intent of CCC that the terms of the
regulations prevail. Prior to any judicial action in a court of
competent jurisdiction, administrative review under 7 CFR part 780 must
be exhausted.
Paperwork Reduction Act
The information collection requirements for CMA participation in
the price support program on behalf of their members have been approved
for use by the Office of Management and Budget (OMB) through March 31,
1996, and assigned OMB No. 0560-0040. The amendments to 7 CFR part 1425
set forth in this proposed rule impose new or revised information
collection requirements in monitoring the application of statutory
payment limitation provisions to members of CMA when the CMA
participates in CCC price support program on behalf of their members.
ASCS will submit an addendum to OMB to revise the information
collection supporting statement for OMB No. 0560-0040.
Public reporting burden for all collections is estimated to average
from 1 to 2 hours per response, including time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and competing and reviewing the collection
of information. Send comments regarding this burden estimate or any
other aspect of this collection, including suggestions for reducing the
burden, to the Department of Agriculture, Clearance Officer, OIRM, P.O.
Box 7630, Washington, DC 20250-0001; and to the Office of Management
and Budget, Paperwork Reduction Project (OMB No. 0560-0040),
Washington, DC 20503.
Background
CMA participation in CCC price support programs on behalf of their
members must be approved by CCC. When approved, a CMA may participate
in price support programs in much the same way as individual producers.
The regulations at 7 CFR part 1425 contain the requirements for CMA
participation. This proposed rule amends those requirements.
In a previous amendment, canola, flaxseed, mustard seed, rapeseed,
safflower, and sunflower seed were added to the list of authorized
commodities for which a CMA may apply for price support. However, these
additional commodities were inadvertently omitted from Sec. 1425.3(d).
This proposed rule revises Sec. 1425.3(d) by adding these commodities
to the list of authorized commodities.
Regulations are being prepared to authorize price support for shorn
mohair and shorn wool to individual producers. This proposed rule adds
these commodities to the list of authorized commodities for an approved
CMA in Sec. 1425.3(d).
This proposed rule adds a new Sec. 1425.3(i) to provide that an
approved CMA may receive loan deficiency payments, when applicable, on
behalf of its members. This reflects an earlier decision to allow an
approved CMA to obtain loan deficiency payments on behalf of its
members in the same way individual producers participate in price
support.
This proposed rule defines, by reference, the terms ``person'' and
``producer'' by amending redesignated Sec. 1425.3(j) and (k) using the
definitions contained in part 1413 of this title. These are the same
definitions used for individual producers participating in various
price support programs.
This proposed rule revises Sec. 1425.4(a) to indicate that a CMA
must apply to ``participate in a price support program'' as defined in
added Sec. 1425.3(i).
This proposed rule revises Sec. 1425.4(b)(7) to change the
reference from Sec. 1425.17 to Sec. 1425.18.
The CMA annual recertification requirement is currently contained
in the title to Sec. 1425.5(c). This proposed rule places that
requirement in the text of Sec. 1425.4(c). An approved CMA may alter
its organizational structure or operations after its initial approval
in such a way to affect compliance with this regulation. This proposed
rule adds Sec. 1425.4(e) to require an approved CMA to resubmit
complete ``initial'' applications every 5 years, or more often, as
required by CCC. The information submitted will be used to evaluate the
continued compliance with these regulations by each approved CMA.
An approved cotton CMA may enter into a Form CCC-Cotton G, Cotton
Cooperative Loan Agreement, with CCC that allows the CMA to obtain
cotton price support through servicing agent banks that are agents of
CCC. This proposed rule adds Sec. 1425.4(f) to require the execution of
this agreement before a CMA can participate in the cotton price support
program.
A CMA requesting approval to participate in the price support
program on behalf of their members must comply with this regulation.
However, on occasion, a CMA may not be able to fully comply with the
all regulations for reasons beyond the control of the CMA, or because
the CMA articles of incorporation or bylaws may require amending. This
proposed rule revises Sec. 1425.6(b)(2) to authorize CCC to grant
conditional approval for a CMA that substantially meet all requirements
of this regulation to participate in a price support program:
(1) When failure to comply with the regulations is determined to be
beyond the control and not due to the negligence of a CMA, or
(2) When the articles of incorporation or bylaws of a CMA do not
comply with the regulations and the board of directors provide
resolutions agreeing to recommend the necessary revision of the
articles of incorporation or bylaws to the membership at the next
membership meeting.
An approved CMA may have members that are also a CMA. CMA members
must also abide with the provisions of this regulation. This proposed
rule revises Sec. 1425.7(a) to provide that CCC approval of a CMA to
participate in a price support program may be withdrawn if any member
CMA does not operate in accordance with representations made in the
application for approval.
The regulation provides that an approved CMA must be owned and
controlled by its active members to help ensure that the CMA is
operated for the benefit of its active members. Determinations of
active member ownership are based on a requirement that active members
must own more than 50 percent of an approved CMA allocated equity.
However, the amount of equity allocated to active members must not
include equity a member obtains as a result of a loan that is not
repaid within a reasonable time. Because the term ``reasonable time''
may be subject to varying interpretations, this proposed rule revises
Sec. 1425.8(b)(2) to require that any such loans not repaid in one year
shall be excluded from the amount of equity owned by active members of
the CMA.
This proposed rule revises Sec. 1425.8(e) to correct a
typographical error.
On occasion, a CMA requests for approval to participate in the
price support program on behalf of members and the CMA has amended its
articles of incorporation or bylaws to contain the verbatim article of
incorporation and bylaw provisions contained in this regulation. This
proposed rule amends Sec. 1425.9 to provide that approved CMA need not
amend their articles of incorporation and bylaws to contain the same
wording as the regulation. The articles of incorporation and bylaws
must only contain provisions that comply with the regulation.
The regulation provides that an approved CMA may only allow elected
directors to make nominations to fill officer positions. This is unduly
restrictive and more CMA's are now allowing members to make nominations
to fill officer positions. In addition, member nominations allow
individual members a more direct role in selecting officers. This
proposed rule revises Sec. 1425.9(d) to allow members to make
nominations to fill officer positions when the articles of
incorporation or bylaws of a CMA authorize the action.
The regulation, with one exception, prohibits voting by proxy or
under a power of attorney in the affairs of an approved CMA. Because
the limited prohibition of voting by proxy is also sufficient to
prohibit voting under a power of attorney, the specific prohibition of
voting under a power of attorney is redundant. Accordingly, this
proposed rule revises Sec. 1425.9(g) to remove the specific prohibition
against voting under a power of attorney.
The regulation provides that a CMA requesting approval to
participate in the price support program must have net worth that
exceeds a minimum amount based on the amounts of authorized commodities
handled by the CMA. The minimum calculated equity amount may exceed the
amount necessary because most approved CMA's handle authorized
commodities that are not included in their approval requests. For
example, a CMA may request approval to participate only in the price
support program for wheat and also handle corn and sorghum. The minimum
net worth would be based on the volume of wheat, corn, and sorghum
handled and not based solely on the volume of wheat.
This proposed rule revises Sec. 1425.10(b)(3)(i) to provide that
the minimum net worth requirement is based only on the authorized
commodities for which CMA is requesting approval.
This proposed rule also revises Sec. 1425.10(b)(3)(ii) to provide
the unit rates used to determine the minimum equity of a CMA requesting
approval to participate in the price support programs for shorn mohair
or shorn wool. This proposed rule revises Sec. 1425.11(c)(3) to change
the reference from Sec. 1425.17 to Sec. 1425.18 The regulation provides
that at least 80 percent of a crop of a commodity that an approved CMA
acquires for marketing must be produced by its members. However, CCC
may, for a period not to exceed two years, waive such requirement for a
CMA, if the CMA satisfy specific criteria. One of the criteria is that
a CMA must have a plan, approved by CCC, which will ensure that the CMA
is in compliance with this provision. This proposed rule revises
Sec. 1425.14(c) to provide that the plan must be in the CMA members'
best interests. This will prevent the CMA from taking action that would
be detrimental to their membership to satisfy this requirement.
The amount of payments producers may receive from participation in
the price support program is limited. This limitation also applies to
payments (marketing gains and loan deficiency payments) that an
approved CMA may receive on behalf of their member producers. Because
members of an approved CMA may obtain payments as individuals through a
county ASCS office and as members of an approved CMA, the CMA is
responsible for ensuring that maximum statutory payment limitations are
not exceeded by its members. This proposed rule adds a new Sec. 1425.16
to provide that an approved CMA must monitor the payments they receive
on behalf of members to ensure that the sum of such payments does not
exceed the assigned amount.
Individual producers must maintain beneficial interest in a
commodity for the commodity to remain eligible for price support. If
beneficial interest is lost, the commodity is immediately ineligible
for price support. This proposed rule amends the redesignated
Sec. 1425.17(a)(2) to provide that an approved CMA and their members
must maintain continued and uninterrupted beneficial interest in all
commodities included in an eligible pool. This action will allow
individual producers and CMA members to more equally participate in the
price support program.
An approved CMA may on occasion inadvertently include ineligible
commodity in their otherwise eligible pools. This may be the result of
receiving incorrect information, clerical errors, or other infrequent,
inadvertent actions. When this happens, it is inappropriate to
determine that the whole pool is ineligible for price support. This
proposed rule revises redesignated Sec. 1425.17(b)(2) to provide that
when CCC determines a quantity of ineligible commodity has been
inadvertently included in an eligible pool, it does not make the
remaining quantity of commodity in the pool ineligible for price
support.
This proposed rule revises redesignated Sec. 1425.17(b)(1)(ii)(B)
to change the reference from Sec. 1425.17 to Sec. 1425.18.
This proposed rule revises redesignated Sec. 1425.17(b)(1)(iii) to
indicate that the time limit is 15 workdays and change the reference
from Sec. 1425.17(a) to Sec. 1425.18(a).
Individual producers are allowed, with respect to some commodities,
to participate in the price support program with the eligible commodity
stored on the farm. To ensure that individual producers and CMA members
may participate in the price support program on an equal basis, this
proposed rule revises redesignated Sec. 1425.17(c)(2) to allow members
to deliver farm-stored commodity, except when prohibited for individual
producers not participating in a price support program as CMA members,
to an eligible pool. This will allow the efficient use of member farm
storage until the commodity is marketed or moved to other storage
facilities. Any unauthorized removal of farm-stored loan collateral
would be a violation of the regulations and subject the CMA to the same
sanctions applied to individual producers for unauthorized removal of
loan collateral.
Individual producers may only pledge otherwise eligible commodity
as collateral for a CCC loan that is free and clear of all liens and
encumbrances, or the producer must obtain a lien waiver where any lien
or encumbrance exists. While minimum financial requirements that an
approved CMA must maintain are sufficient to protect CCC's interest
from outstanding liens or encumbrances based on a CMA's member's
actions, the risk from liens and encumbrances resulting from the CMA
actions could be more severe. Therefore, this proposed rule adds
paragraph (c)(5) to redesignated Sec. 1425.17 to provide that a
commodity offered as collateral for a CCC loan shall be free and clear
of all liens and encumbrances based on the actions of the CMA or the
CMA shall obtain lien waivers for such liens. In addition, the CMA
shall not take any action that would create a lien or encumbrance on
the commodity while it is pledged as collateral for a CCC loan.
The regulation provides that net loan proceeds, less authorized
charges, from loans not repaid within 15 days must be distributed to
eligible pool members within 15 days. This is to ensure that members
promptly benefit from loans not redeemed within the time period.
However, this provision has not been extended to loan deficiency
payments. As a result, an approved CMA is under no obligation to
distribute loan deficiency payments to members in a timely manner. This
proposed rule revises redesignated Sec. 1425.18(a) to require that
proceeds from loan deficiency payments must be distributed within 15
days. In addition, the proposed rule clarifies that 15 days means 15
work days.
As a result of a producer's failure to fully comply with price
support regulations, disbursements to individual producers are not made
until such obligations are satisfied. This proposed rule extends this
procedure to CMA members by adding paragraph (b)(5) to redesignated
Sec. 1425.18 to require an approved CMA, when notified by CCC, to
refrain from making pool disbursements, based on the commodity
delivered to an eligible pool, to a member and to reimburse such funds
to CCC, as directed.
The regulation prohibits an approved CMA from discriminating
against or otherwise denying any producer's participation with respect
to any benefits resulting from its approval to obtain price support as
provided in applicable nondiscrimination statutes. The current
regulation does not specifically identify marital status, physical
disability, and mental disability as grounds for discrimination. This
proposed rule revises redesignated Sec. 1425.20 to prohibit
discrimination of an approved CMA member based on marital status,
physical disability, or mental disability.
Producers who participate in CCC price support program through an
approved CMA also may participate in the price support programs through
county ASCS offices. As a result, CCC must obtain member information
from an approved CMA that can be combined with information in county
ASCS offices to monitor a member's overall activity. Accordingly, this
proposed rule adds a new Sec. 1425.23 to provide that an approved CMA
shall:
1. Annually provide a report of the amount of commodity received
from members by farm numbers, and
2. At least annually, report by crop year and commodity the sum of
marketing loan gains and loan deficiency payments received on behalf of
each producer member. This information will help CCC monitor the amount
of the commodity delivered from a farm to an approved CMA in order to,
among other things, evaluate individual producer requests for commodity
disaster payments and to monitor producer payments.
List of Subjects in 7 CFR Part 1425
Cooperatives, Price support programs, Reporting and recordkeeping
requirements.
Accordingly, it is proposed that 7 CFR part 1425 be amended as
follows:
PART 1425--COOPERATIVE MARKETING ASSOCIATIONS
1. The authority citations for 7 CFR part 1425 is revised to read
as follows:
Authority: 7 U.S.C. 1421(a), 1441, 1444(a), 1446(d), and 1447;
15 U.S.C. 714b, 714c, and 714j.
2. Section 1425.3 is amended by:
A. Revising paragraph (d),
B. Redesignating paragraphs (i) and (j) as paragraphs (j) and (k)
respectively,
C. Adding a new paragraph (i), and
D. Revising newly redesignated paragraphs (j) and (k) to read as
follows:
Sec. 1425.3 Definitions.
* * * * *
(d) Authorized commodity means those commodities for which an
approved cooperative may apply for price support, including barley,
canola, corn, cotton, flaxseed, honey, shorn mohair, mustard seed,
oats, rapeseed, rice, rye, safflower, seed cotton, shorn wool, sorghum,
soybeans, sunflower seed, and wheat.
* * * * *
(i) Participate in a Price Support Program means the pledging, on
behalf of members, of an eligible commodity as collateral for CCC price
support loans, entering into purchase agreements, and, when applicable,
obtaining loan deficiency payments.
(j) Person means an individual, joint stock company, corporation,
estate or trust, association, or other legal entity, except that two or
more entities shall be combined as one person in accordance with:
(1) The regulations found at part 1497 of the chapter for the
purpose of administering maximum payment limitation provisions of the
Food Security Act of 1985;
(2) The regulations found at part 796 of this title for the purpose
of administering the provisions of the Food Security Act of 1985 with
respect to the production of controlled substances; and
(3) The regulations found at part 12 of this title pertaining to
the highly erodible land and wetland provisions (commonly know as
``sodbuster and swampbuster'' provisions) of the Food Security Act of
1985.
(k) Producer means a person who, as owner, landlord, tenant, or
sharecropper, shares in the risk of producing the crop, and is entitled
to share in the crops available for marketing from the farm, or would
have shared had the crops been produced.
3. In Sec. 1425.4, paragraphs (a), (b)(7), and the introductory
text of paragraph (c) are revised and paragraphs (e) and (f) are added
to read as follows:
Sec. 1425.4 Approval.
(a) Application. In order for a cooperative to participate in a
price support program with respect to the 1994 and subsequent crops of
authorized commodities, a cooperative must submit an application for
approval with respect to such authorized commodities to CCC.
(b) * * *
(7) A detailed description of the method by which proceeds from a
pool of eligible commodities for which price support is obtained will
be distributed as provided for in Sec. 1425.18.
* * * * *
(c) Annual recertification. An approved cooperative must submit, on
an annual basis, the following information to CCC:
* * * * *
(e) Reapplication. Approved cooperatives must submit revised
applications as required by this section instead of an annual
recertification every 5 years, or more often if CCC determines that
such application is necessary to determine if a cooperative has
implemented an organizational or operational change that would affect
compliance with the provisions of this part.
(f) Form CCC-Cotton G. Cooperative marketing associations applying
for approval to participate in the price support program for cotton
shall execute Form CCC-Cotton G, Cotton Cooperative Loan Agreement,
with CCC.
4. Section 1425.6 (b)(2) is revised to read as follows:
Sec. 1425.6 Approved cooperatives.
* * * * *
(b) * * *
(2) Conditionally approved. (i) A cooperative may be conditionally
approved if CCC determines that it has substantially met all the
requirements of this part, and the failure to meet the remaining
requirements is due to reasons beyond the control of the cooperative
and not due to the cooperative's negligence; and
(ii) Such cooperative must agree in writing to meet all
requirements for approval set forth in this part within the time period
specified by CCC. When a cooperative can only comply with the
regulations by amending its articles of incorporation or bylaws at a
membership meeting, CCC may accept a board of directors resolution
agreeing to recommend to the members at the next meeting of the members
the required changes to the articles of incorporation or bylaws as
compliance with the requirements for approval for purposes of this
section. Board resolutions in which the cooperative agrees to comply
with other provisions of this part may be accepted by CCC as compliance
with the requirements for approval for purposes of this section.
* * * * *
5. Section 1425.7 (a) is revised to read as follows:
Sec. 1425.7 Suspension and termination of approval.
(a) Suspension. An approved cooperative may be suspended by CCC
from further participation in a price support program if CCC determines
that the cooperative or a member cooperative, as specified in
Sec. 1425.19:
(1) Has not operated in accordance with the conditions specified in
such cooperative's application for approval;
(2) Has not complied with applicable regulations; or
(3) Has failed to correct deficiencies noted during an
administrative review or an audit of the cooperative's operations with
respect to a price support program. Such suspension may be lifted upon
the receipt of documents indicating that the cooperative has complied
with all requirements for approval. If such documents are not received
within one year from the date of the suspension, the cooperative's
approval for participation in a price support program shall be
terminated.
* * * * *
6. In Sec. 1425.8, paragraphs (b)(2) and (e) are revised to read as
follows:
Sec. 1425.8 Ownership and control.
* * * * *
(b) * * *
(2) The allocated equity of any active member that has acquired
equity as a result of a loan from the cooperative unless such member is
obligated to repay the loan within one year.
* * * * *
(e) Approved plan. An applicant or an approved cooperative not
under the ownership or control, or both, of its active members, may be
approved by CCC to participate in a price support program if the
cooperative is able to establish that, by retiring the equity of its
inactive members or by obtaining new members, the cooperative can vest
ownership and control in its active members, as required by this
section, by a date specified by CCC.
7. Section 1425.9 is amended by revising the introductory text and
paragraphs (d) and (g) to read as follows:
Sec. 1425.9 Charter and bylaw provisions.
The articles of incorporation, articles of association, or the
bylaws of the cooperative shall comply with each of the following
requirements:
* * * * *
(d) Nominations. (1) Nominations for election of delegates and
directors shall be made by members.
(2) Nominations for officers shall be made by elected directors or
by members when nomination by members is authorized in the
cooperative's articles of incorporation or bylaws.
(3) Nominations may be made by balloting, nominating committee,
petition of members, or from the floor, provided that nominations from
the floor shall be requested in addition to nominations made by a
nominating committee or by petition.
* * * * *
(g) Proxy. (1) Except as provided in paragraph (g)(2) of this
section, voting by proxy shall be prohibited.
(2) Voting by proxy may be permitted if a cooperative:
(i) Determines that it is necessary to amend the cooperative's
articles of incorporation, articles of association, or bylaws, and
(ii) Establishes to the satisfaction of CCC that the law of the
State in which the cooperative is incorporated permits voting by proxy,
but does not permit members to vote by mail, with respect to such
issue.
* * * * *
8. In Sec. 1425.10, paragraph (b)(3) is revised to read as follows:
Sec. 1425.10 Financial condition.
* * * * *
(b) * * *
(3)(i) The net worth of the cooperative. The cooperative shall be
considered to have a sufficient net worth if such net worth is equal to
the product of an amount per unit for a commodity (as set forth in
table 1) multiplied by the total number of such units of commodity for
which the cooperative is approved, or requesting approval, to
participate in price support and handled by the cooperative during the
preceding marketing year, or, if the cooperative is in its first full
marketing year of operations, the estimated quantity of such commodity
that it will handle during such year.
(ii) (A) If the amount of the net worth of the cooperative is
between 34 and 99 percent of the amount computed in accordance with
paragraph (b)(3)(i) of this section and the cooperative is determined
by CCC to be otherwise financially sound, CCC may determine that such
cooperative meets the requirements of this section. Such a
determination by CCC may be made if:
(1) The board of directors of the cooperative agrees to make a
capital retain in the amount set forth in table 2 with respect to each
unit of the commodity delivered to the cooperative until the net worth
of the cooperative is at least equal to the amount computed in
accordance with paragraph (b)(3)(i) of this section, and
(2) The cooperative agrees to deduct from pool proceeds the full
amount of the estimated expenses of handling the commodities received
by the cooperative.
(B) The failure to carry out such agreements shall be grounds for
suspending a cooperative's approval.
Table 1
------------------------------------------------------------------------
Amount per
Commodity Unit unit
------------------------------------------------------------------------
Barley....................... Bushel....................... 0.13
Canola....................... Hundredweight................ 0.62
Corn......................... Bushel....................... 0.13
Cotton....................... Bale......................... 6.40
Flaxseed..................... Hundredweight................ 0.62
Honey........................ Hundredweight................ 1.90
Mustard Seed................. Hundredweight................ 0.62
Oats......................... Bushel....................... 0.13
Rapeseed..................... Hundredweight................ 0.62
Rice......................... Hundredweight................ 0.52
Rye.......................... Bushel....................... 0.13
Safflower.................... Hundredweight................ 0.62
Seed Cotton (lint basis)..... Pound........................ 0.008
Shorn Mohair................. Pound........................ 0.16
Shorn Wool................... Pound........................ 0.38
Sorghum...................... Hundredweight................ 0.19
Soybeans..................... Bushel....................... 0.43
Sunflower Seed............... Hundredweight................ 0.62
Wheat........................ Bushel....................... 0.15
------------------------------------------------------------------------
Table 2
------------------------------------------------------------------------
Amount per
Commodity Unit unit
------------------------------------------------------------------------
Barley....................... Bushel....................... 0.07
Canola....................... Hundredweight................ 0.32
Corn......................... Bushel....................... 0.07
Cotton....................... Bale......................... 3.20
Flaxseed..................... Hundredweight................ 0.32
Honey........................ Hundredweight................ 0.95
Mustard Seed................. Hundredweight................ 0.32
Oats......................... Bushel....................... 0.07
Rapeseed..................... Hundredweight................ 0.32
Rice......................... Hundredweight................ 0.26
Rye.......................... Bushel....................... 0.07
Safflower.................... Hundredweight................ 0.32
Seed Cotton (lint basis)..... Pound........................ 0.004
Shorn Mohair................. Pound........................ 0.08
Shorn Wool................... Pound........................ 0.19
Sorghum...................... Hundredweight................ 0.10
Soybeans..................... Bushel....................... 0.22
Sunflower Seed............... Hundredweight................ 0.32
Wheat........................ Bushel....................... 0.08
------------------------------------------------------------------------
* * * * *
9. In Sec. 1425.11, paragraph (c)(3) is revised to read as follows:
Sec. 1425.11 Operations.
* * * * *
(c) * * *
(3) Require that all proceeds from the marketing operation be
distributed as provided in Sec. 1425.18.
10. In Sec. 1425.14, paragraph (c) is revised to read as follows:
Sec. 1425.14 Member business.
* * * * *
(c) The cooperative has a plan, approved by CCC, which CCC
determines to be in the cooperative members' best interest and will
bring the cooperative into compliance with the provisions of this
section. Commodities purchased or acquired from CCC and processed
products acquired from other processors or merchandisers shall not be
considered in determining the volume of member or nonmember business.
11. Sections 1425.16 through 1425.21 and Secs. 1425.22 and 1425.23
are redesignated as Secs. 1425.17 through 1425.22 and Secs. 1425.24 and
1425.25, respectively, and a new Sec. 1425.16 is added to read as
follows:
Sec. 1425.16 Payment limitation.
Approved cooperatives shall monitor marketing loan gains, loan
deficiency payments, and other payments they receive from CCC on behalf
of their members and ensure that the sum of the amounts received for
each member does not exceed the member's payment limitation determined
in accordance with part 1497 of this title that, for purposes of
administrating such part, is assigned by CCC to the cooperative.
12. Newly redesignated Sec. 1425.17 is amended by revising
paragraphs (a)(2), (b)(1)(i), (b)(1)(ii), (b)(1)(iii), (c)(2), and
adding paragraph (c)(5) to read as follows:
Sec. 1425.17 Eligible commodity and pooling.
(a) * * *
(2) PRICE SUPPORT WILL BE MADE AVAILABLE TO APPROVED COOPERATIVES
WITH RESPECT TO A QUANTITY OF AN ELIGIBLE COMMODITY INCLUDED IN AN
ELIGIBLE POOL AS PROVIDED IN PARAGRAPH (C) OF THIS SECTION AND THE
BENEFICIAL INTEREST PROVISIONS OF PARTS 1421, 1427, 1435, AND 1468
OF THIS CHAPTER.
(b) * * *
(1) * * *
(i) All of the commodity included in the pool is eligible for price
support, except as provided in paragraph (b)(2) of this section;
(ii) The eligible commodity in such pool was:
(A) Delivered to the cooperative for marketing for the benefit of
the members of the cooperative, and
(B) Delivered by members who retain the right to share in the
proceeds from the marketing of the commodity in accordance with
Sec. 1425.18.
(iii) Except with respect to a quantity of a commodity pledged as
collateral for a price support loan and which is redeemed within 15
work days from the date the cooperative receives the proceeds from CCC,
all of the commodity placed in such pool was delivered by members who
have agreed to accept a payment of the initial advances made available
to such producers by the cooperative with respect to such commodity in
accordance with Sec. 1425.18(a).
(2) If CCC determines that a cooperative has inadvertently included
in a pool a quantity of commodity which is ineligible for price support
because of grade, quality, bale weight or repacking in the case of
cotton, or other factors, the remaining quantity of commodity shall
remain eligible for price support.
* * * * *
(c) * * *
(2) Price support will be available to the cooperative for the
quantity of a farm-stored commodity that is, pursuant to such
cooperative's marketing agreement with a member, part of the
cooperative's pool.
* * * * *
(5) Commodities pledged as collateral for CCC price support loans
shall be free and clear of all liens and encumbrances based on an
approved cooperative's financial agreements or the cooperative shall
obtain a completed Form CCC-679, Lien Waiver. Approved cooperatives
shall not take any action to cause a lien or encumbrance to be placed
on a commodity after a loan is approved.
* * * * *
13. Newly redesignated Sec. 1425.18 is amended by revising
paragraphs (a) and (a)(1) and adding paragraph (b)(5) to read as
follows:
Sec. 1425.18 Distribution of proceeds.
(a) CCC loans, purchases, and loan deficiency payments. (1) If CCC
makes available price support loans, purchases, or loan deficiency
payments with respect to any quantity of the eligible commodity in a
pool, the proceeds from such loans, purchases, or loan deficiency
payments shall be distributed to members participating in such pool on
the basis of the quantity and quality of the commodity delivered by
each member which is included in the pool less any authorized charges
for services performed or paid by the cooperative which are necessary
to condition the commodity or otherwise make the commodity eligible for
price support. Except with respect to commodities which are pledged as
collateral for a price support loan and which are redeemed within 15
work days from the date the cooperative receives the loan proceeds from
CCC, such proceeds shall be distributed within 15 work days from such
date. Loan deficiency payments received from CCC shall be distributed
within 15 work days of receipt from CCC.
* * * * *
(b) * * *
(5) When notified by CCC that pool distributions to a member of any
eligible pool must be reduced for a program year, farm, or crop,
cooperatives shall refrain from making such pool distributions and
shall, if appropriate, reimburse CCC for such distributions.
* * * * *
14. Newly redesignated Sec. 1425.20 is revised to read as follows:
Sec. 1425.20 Nondiscrimination.
The cooperative shall not, on the basis of race, color, age, sex,
religion, marital status, national origin, physical disability, or
mental disability, deny any producer participation in, or otherwise
subject any producer to discrimination with respect to any benefits
resulting from its approval to obtain price support and shall comply
with the provisions of Title VI of the Civil Rights Act of 1964 and the
Secretary's regulations issued thereunder, appearing in Secs. 15.1-
15.12 of this title (29 FR 16274 and 29 FR 16966), and any amendments
thereto; section 504 of the Rehabilitation Act of 1973, as amended by
the Rehabilitation Comprehensive Services and Developmental
Disabilities Amendments of 1978; and provisions of the Age
Discrimination Act of 1975, as amended. The cooperative shall not
discriminate against employees under Title VII of the Civil Rights Act
of 1964, as amended, or the Equal Pay Act of 1963 or Title VI of the
Civil Rights Act of 1964 as administered by the Equal Employment
Opportunity Commission, and shall handle employee discrimination
complaints as provided for in 28 CFR part 42 and 29 CFR part 1691. The
United States shall have the right to enforce compliance with such
statutes and regulations by suit or by any other action authorized by
law. The cooperative shall submit a certification with its application
that the above cited regulations and rules have been read and
understood and that the cooperative will abide by them.
15. A new Sec. 1425.23 is added to read as follows:
Sec. 1425.23 Reports.
(a) Approved cooperatives shall annually provide CCC with a PSL-86R
report to applicable county ASCS offices. The report shall include all
eligible and ineligible commodity receipts by ASCS farm number for each
member.
(b) Approved cooperatives shall at least annually, report by
commodity and by crop the marketing loan gains, loan deficiency
payments, and any other payments received on behalf of each producer
member.
Signed at Washington, DC, on August 23, 1994.
Bruce R. Weber,
Acting Executive Vice President, Commodity Credit Corporation.
[FR Doc. 94-21509 Filed 8-30-94; 8:45 am]
BILLING CODE 3410-05-P
