[Federal Register: June 24, 2005 (Volume 70, Number 121)]
[Proposed Rules]
[Page 36536-36539]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24jn05-26]
========================================================================
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.
========================================================================
[[Page 36536]]
DEPARTMENT OF AGRICULTURE
Commodity Credit Corporation
7 CFR Part 1427
RIN 0560-AH29
Cottonseed Payment Program
AGENCY: Commodity Credit Corporation, USDA.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: This rule proposes regulations to implement provisions of the
Military Construction Appropriations and Emergency Hurricane
Supplemental Appropriations Act, 2005, enacted on October 13, 2004
(``2004 Act'') to provide assistance to producers and first-handlers of
the 2004 crop of cottonseed in counties declared a disaster by the
President of the United States due to 2004 hurricanes and tropical
storms.
DATES: Comments on this rule must be received July 25, 2005 in order to
be assured consideration. Comments on the information collection in
this rule must be received by August 23, 2005 in order to be assured
consideration.
ADDRESSES: The Farm Service Agency invites interested persons to submit
comments on this proposed rule and on the collection of information.
Comments may be submitted by any of the following methods:
E-Mail: Send comments to chris.kyer@wdc.usda.gov
Fax: Submit comments by facsimile transmission to (202) 690-3307.
Mail: Submit comments to Grady Bilberry, Director, Price Support
Division (PSD), Farm Service Agency (FSA), United States Department of
Agriculture (USDA), STOP 0512, Room 4095-S, 1400 Independence Avenue,
SW., Washington, DC 20250-0512.
Hand Delivery or Courier: Deliver comments to the above address.
Federal eRulemaking Portal: Go to http://www.regulations.gov Follow
the online instructions for submitting comments.
Comments may be inspected in the Office of the Director, PSD, FSA,
USDA, Room 4095, South Building, Washington, DC, between 8 a.m. and
4:30 p.m. Monday through Friday, except holidays. A copy of this
proposed rule is available on the PSD Web site at http://www.fsa.usda.gov/dafp/psd
.
Comments on the information collection requirements of this rule
must also be sent to the addresses listed in the Paperwork Reduction
Act section of this notice.
FOR FURTHER INFORMATION CONTACT: Chris Kyer, phone: (202) 720-7935; e-
mail: chris.kyer@wdc.usda.gov.
SUPPLEMENTARY INFORMATION:
Background
Section 104 of Division B of the 2004 Act (Pub. L. 108-324),
requires the Commodity Credit Corporation (CCC) to provide assistance
to producers and first-handlers of the 2004 crop of cottonseed in
counties declared a disaster by the President of the United States due
to hurricanes. Section 789 of Division A of the Consolidated
Appropriations Act, 2005 (Pub. L. 108-447) further amended section 104
of Division B of the 2004 Act by adding as eligible counties those
which were declared disasters because of tropical storms. The 2004 Act
appropriated $10 million for these payments. As amended, the provisions
of section 104 read in full:
The Secretary of Agriculture shall use $10,000,000 to provide
assistance to producers and first handlers of the 2004 crop of
cottonseed located in counties declared a disaster by the President
of the United States in 2004 due to hurricanes or tropical storms.
Further, section 105 of Division B of the same Act provides that
the funds, facilities and authorities of the CCC shall be used to carry
out Section 104.
CCC most recently operated a Cottonseed Payment Program in 2003,
the 2002-Crop Cottonseed Payment Program (68 FR 20332, April 25, 2003).
This rule proposes that the 2004 Cottonseed Payment Program operate
somewhat like the 2002 program in that payments will be made to cotton
gins for distribution to eligible producers. However, the 2002 program
was tied simply to previous year's production. Consistent with the
terms of section 104 and other provisions of the same legislation, this
rule proposes to provide payments for cottonseed loss in eligible
counties based on a comparison of a producer's production in the year
before the disaster (making the 2003 crop year the base year) to the
amount produced in 2004, the year of the hurricanes. Generally, a gin's
eligibility will be based on the lint lost to gins in deliveries of
2004-crop cotton because of reductions in lint production in eligible
counties adjusted for changes in plantings and for crop losses due to
other causes. This rule proposes special provisions for producers who
for the 2004 crop were new producers, and for producers who delivered,
or would have delivered, cotton to more than one gin. Accordingly,
whereas previous cottonseed programs have covered all cottonseed,
benefits here will be tied to losses of cottonseed because of eligible
losses of delivered cotton lint in eligible disaster counties. Comment
is invited on all aspects of the proposed regulations.
CCC will announce a period during which U.S. cotton gins may apply
for cottonseed payments. To participate, cotton gins must complete an
application form including: (1) Applicant name, address, and a contact
person and phone; (2) bank account information for payees electing to
have payments made by direct account deposit; (3) the gin 5-digit
identifying code; (4) the weight (in pounds) of cotton lint for which
payment is requested; and (5) the number of bales of cotton ginned from
the applicable lint weight. CCC must receive the application within the
announced application period.
So that the basic method of operation of the proposed rule is
clear, the following example is offered:
Example:
1. Producer A grows 450 acres of 2004 cotton in an eligible county
and gin A obtains 225,000 pounds of lint from that cotton. Producer A
grew 500 acres of 2003 cotton, and gin A obtained 375,000 pounds of
lint weight from the 2003 cotton.
2. Gin A calculates the producer's loss in lint weight was 112,500
pounds, taking into consideration the difference in acres between the
two years and the difference in production by calculating the per-acre
yield for each year and multiplying the difference in yield by the 2004
acres. The 112,500 pound loss is derived by multiplying the 450 acres
[[Page 36537]]
of 2004 cotton by the 250-pound loss in lint yields per acre from 2004
to 2003.
3. Gin A calculates the loss for each of its customers and submits
the total of the losses to FSA as a basis for payment. Producers who
did not have a loss in yield are not included in the total amount
submitted for payment.
Cases involving producers who might have been unable to deliver any
cotton in 2004 to any gin because of the disaster are dealt with
separately in the rule.
Upon receipt of all payment applications from all gins seeking to
participate, CCC will estimate the national total quantity of
cottonseed for payment based on the weight of cotton lint for which
payment is requested. The payment rate per ton of cottonseed will be
determined by dividing the $10 million available by the total quantity
of cottonseed for payment. In order to be sure that an eligible
producer is not over compensated (does not receive more than the total
economic value of the loss suffered), payments to individual cotton
gins will be subject to a payment limitation equal to the result of
multiplying the total pounds of cottonseed determined eligible by the
2004 national average price of cottonseed ($112 per short ton).
CCC plans to provide all 2004-crop cottonseed payments to cotton
gins and to require gins to share such payments with applicable cotton
producers to the extent that the effect of cottonseed prices was borne
by the producer rather than the gin. This payment plan is proposed
because of the various agreements between ginners and producers
regarding the costs of ginning and the disposition of the proceeds from
the sale of cottonseed. These agreements were entered into prior to the
ginning of 2004-crop cotton and the authorization of this cottonseed
payment program, and CCC has no knowledge of their terms. Based on
these existing contracts and marketing agreements, ginners and
producers are best suited to equitably distribute the cottonseed
assistance payments. However, producers dissatisfied with the
distribution by the gin will, as in previous cottonseed programs, be
limited to complaints directed toward the gin itself as may be allowed
under law--that is, the regulations propose no administrative remedy.
In order to identify eligible production from designated counties,
CCC will also ask gins to identify cotton production from designated
counties versus that from non-designated counties and apply for only an
eligible payment quantity. CCC believes that gins are well suited to be
able to identify eligible production using existing systems and readily
available data. Because of the nature of the interest involved in this
notice it has been determined that the comment period should be limited
to 30 days; that is, that a longer period would be contrary to the
public interest.
Executive Order 12866
This proposed rule has been determined to be ``Significant'' under
Executive Order 12866 and was reviewed by the Office of Management and
Budget (OMB). A cost-benefit assessment of this rule was completed.
Regulatory Flexibility Act
The Regulatory Flexibility Act does not apply to this proposed rule
because CCC is not required by 5 U.S.C. 553 or any other law to publish
a notice of proposed rulemaking with respect to the subject of this
rule.
Environmental Assessment
The environmental impacts of this proposed rule have been
considered consistent with the provisions of the National Environmental
Policy Act of 1969 (NEPA), 42 U.S.C. 4321 et seq., the regulations of
the Council on Environmental Quality (40 CFR Parts 1500-1508), and
FSA's regulations for compliance with NEPA, 7 CFR part 799. To the
extent these authorities may apply, CCC has concluded that this rule is
categorically excluded from further environmental review as evidenced
by the completion of an environmental evaluation. No extraordinary
circumstances or other unforeseeable factors exist which would require
preparation of an environmental assessment or environmental impact
statement. A copy of the environmental evaluation is available for
inspection and review upon request.
Executive Order 12988
The proposed rule has been reviewed in accordance with Executive
Order 12988. This proposed rule preempts State laws to the extent such
laws are inconsistent with it. This rule is not retroactive. Before
judicial action may be brought concerning this rule, all administrative
remedies set forth at 7 CFR Parts 11 and 780 must be exhausted.
Executive Order 12372
This program is not subject to 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).
Unfunded Mandates
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) does
not apply to this rule because CCC is not required by 5 U.S.C. 553 or
any other law to publish a notice of proposed rulemaking for the
subject of this rule. Further, this rule contains no unfunded mandates
as defined in sections 202 and 205 of UMRA.
Paperwork Reduction Act of 1995
In accordance with the Paperwork Reduction Act of 1995, FSA intends
to request approval by OMB of an information collection required to
support the proposed rule establishing a 2004 crop year cottonseed
payment program. Copies of the information collection may be obtained
from Linda Turner, the Agency Information Collection Coordinator, at
(202) 690-1855.
Title: 2004 Cottonseed Payment Program.
OMB Control Number: 0560-NEW.
Type of Request: Request for Approval of a New Information
Collection.
Abstract: Section 104 of the 2005 Act requires the Commodity Credit
Corporation to provide assistance to producers and first-handlers of
the 2004 crop of cottonseed in counties declared a disaster by the
President of the United States due to hurricanes and tropical storms.
This rule is intended to implement this legislative mandate and assist
producers who suffered financially as a result of unfavorable weather
conditions in 2004 caused by hurricanes and tropical storms. Applicants
are asked to provide: (1) The weight of lint to be used by CCC for
determining seed weight for payment based upon calculation of a loss in
lint production; (2) the number of bales ginned and applicable to the
lint weight for which payment is requested, not adjusted to a uniform
bale weight basis; and (3) basic data such as name and address, direct
deposit information, and tax identification number. The information
will be used by FSA to determine the program eligibility of the gin.
FSA considers the information collected essential to prudent
eligibility determinations and payment calculations. Additionally,
without accurate information on lint weight and bale numbers, the
national payment rate could be inaccurate and could result in payments
being made to ineligible recipients, or overpayments, compromising the
integrity and accuracy of the program.
Estimate of Burden: Public reporting burden for this collection of
information is estimated to average 45 minutes per response.
[[Page 36538]]
Respondents: Cotton gins receiving 2004 crop cotton from counties
declared a disaster by the President of the United States due to
hurricanes and tropical storms.
Estimated Number of Respondents: 120.
Estimated Number of Responses per Respondent: 1.
Estimated Total Annual Burden on Respondents: 90 hours.
Proposed topics for comment include: (a) Whether the collection of
information is necessary for the proper performance of the functions of
the agency, including whether the information will have practical
utility; (b) the accuracy of the agency's estimate of burden including
the validity of the methodology and assumptions used; (c) ways to
enhance the quality, utility, and clarity of the information collected;
or (d) ways to minimize the burden of the collection of the information
on those who are to respond, including through the use of appropriate
automated, electronic, mechanical, or other technological collection
techniques or other forms of information technology. Comments should be
sent to Grady Bilberry, Director, Price Support Division, Farm Service
Agency, United States Department of Agriculture, STOP 0512, 1400
Independence Avenue, SW., Washington, DC 20250-0512 or telephone (202)
720-7901.
Government Paperwork Elimination Act
CCC is committed to compliance with the Government Paperwork
Elimination Act (GPEA) and the Freedom to E-File Act, which require
Government agencies in general, and the FSA in particular, to provide
the public the option of submitting information or transacting business
electronically to the maximum extent possible. Because of the need to
publish these regulations quickly, the forms and other information
collection activities required to be utilized by a person subject to
this rule are not yet fully implemented in a way that would allow the
public to conduct business with CCC electronically. Accordingly, at
this time, all forms required to be submitted under this rule may be
submitted to CCC by mail or FAX.
List of Subjects in 7 CFR Part 1427
Agriculture, Cottonseed.
For the reasons set out in the preamble, 7 CFR 1427 is proposed to
be amended as set forth below.
PART 1427--COTTON
1. The authority citation for 7 CFR part 1427 is revised to read as
follows:
Authority: 7 U.S.C. 7231-7239; 15 U.S.C. 714b, 714c; Pub. L.
108-324, Pub. L. 108-447.
Subpart F--2004 Cottonseed Payment Program
2. Revise the title of part 1427 subpart F to read as set forth
above:
3. Revise Sec. 1427.1100 to read as follows:
Sec. 1427.1100 Applicability.
(a) Subject to the availability of funds, this subpart sets forth
the terms and conditions under which the Commodity Credit Corporation
(CCC) may provide payments under the cottonseed payment program for the
2004 crop year of cottonseed. Additional terms and conditions may be
set forth in the application or other forms which must be executed to
participate in the cottonseed payment program.
(b) Payments shall be available only as provided in this subpart
and only with respect to cottonseed losses related to 2004-crop cotton
production in counties declared a disaster by the President of the
United States due to hurricanes or tropical storms.
Sec. 1427.1102 [Amended]
4. In Sec. 1427.1102, remove the definitions ``Number of ginned
cotton bales'' and ``Running bale.''
5. Revise Sec. 1427.1103 to read as follows:
Sec. 1427.1103 Eligible cottonseed.
To be eligible for payments under this subpart, cottonseed losses
must:
(a) Be related to 2004-crop cotton production in a county declared
a disaster by the President of the United States due to 2004 hurricanes
or tropical storms.
(b) Not have been destroyed or damaged by fire, flood, or other
events such that its loss or damage was compensated by other local,
State, or Federal government or private or public insurance or disaster
relief payments.
6. Amend Sec. 1427.1104 by revising the section heading, revising
paragraph (a) and in paragraph (c) changing the term ``low cottonseed
prices'' to ``loss of the cottonseed'' to read as follows:
Sec. 1427.1104 Eligible applicants (first handlers).
(a) Only an eligible first handler of cottonseed shall be eligible
to file an application for payment under this subpart. An eligible
first handler of cottonseed may only be a gin that has an eligible
payment quantity as determined under Sec. 1427.1107.
* * * * *
7. Amend Sec. 1427.1105 by revising the section heading and
revising paragraph (b) to read as follows:
Sec. 1427.1105 Payment application and deadline.
* * * * *
(b) The application deadline shall be 30 days after the rules in
this subpart become effective unless otherwise announced by CCC.
* * * * *
8. Revise Sec. 1427.1106 to read as follows:
Sec. 1427.1106 Available funds.
The total available program funds for the 2004-crop cottonseed
program provided for in this subpart shall be $10 million.
9. Revise Sec. 1427.1107 to read as follows:
Sec. 1427.1107 Applicant payment quantity.
(a) The applicant's payment quantity of cottonseed will be
calculated by the applicant and submitted on the Cottonseed Payment
Application and Certification for approval for by CCC. An applicant
must be a gin and the applicant's payment eligibility will be based on
the determination of the amount of lint deliveries by cotton producers
in eligible counties which were lost to the gin because of the
qualifying hurricane or tropical storm as calculated under this
section.
(1) The lost lint determination will be made on a producer-by-
producer and farm-by-farm basis, based on producer certification,
ginning records and other relevant information as applicable.
(2) The loss determination will be limited to losses related to
2004-crop cotton production in eligible counties. A cotton producer's
gross loss of lint shall be determined based on a comparison of lint
deliveries for 2003 and 2004 by the producer from the eligible farm to
all gins. That difference will be adjusted to reflect changes in the
acreage planted in the two years by the producer on the eligible farm
and adjusted for losses due to reasons other than hurricane or tropical
storm.
(b) The producer will certify the gin or gins to which the lost
lint production as so determined would have been delivered. Also, the
producer will certify the relevant percentages of the losses that would
have been delivered to each gin if more than one gin would have
received the deliveries. Apportionment of the loss may be made by CCC
between gins on that basis.
(c) If the producer delivered 2004-crop cotton to a gin different
than the gin to which the producer delivered 2003-crop cotton, or
delivered cotton to
[[Page 36539]]
more than one gin in either 2003 or 2004, the gin receiving 2004-crop
cotton shall contact the other gins for production information or
obtain other proof of the eligible quantity from the cotton producer so
as to make or verify the calculation called for in paragraph (a) of
this section.
(d) If the cotton producer did not produce 2003-crop cotton the
producer shall be considered a new producer. A new producer's eligible
lost quantity will be determined as provided in paragraph (a) of this
section except that the amount of loss of lint will be made by
comparing the producer's actual 2004 per-acre yield with the 2003 USDA,
National Agricultural Statistics Service county average yield for the
applicable county.
(e) The gin's lint eligibility will be calculated individually with
respect to all eligible cotton producers and those individual
eligibilities for the gin will then be added together to determine the
total lint eligibility of the gin. From that amount of lint
eligibility, the applicant gin's payment quantity of cottonseed shall
be calculated by multiplying:
(1) The applicant gin's eligible weight of lint for which payment
is requested, as approved by CCC, and as determined in paragraphs (a)
through (d) of this section by;
(2) The Olympic average of estimated pounds of cottonseed per pound
of ginned cotton lint, as determined by CCC, for the five years
preceding the 2004 crop year.
10. Revise Sec. 1427.1108 to read as follows:
Sec. 1427.1108 Total payment quantity.
The total quantity of 2004-crop cottonseed eligible under this
subpart shall be based on the total payment quantity of cottonseed as
determined under this subpart for which timely applications are filed.
Eligible cottonseed for which no application is received according to
announced application instructions shall not be included in the total
payment quantity of cottonseed. The total payment quantity of
cottonseed (ton-basis) shall be calculated by multiplying:
(a) The total weight of cotton lint (ton-basis) for which payment
is requested by all applicants, as approved by CCC, by
(b) The Olympic average of estimated pounds of cottonseed per pound
of ginned cotton lint, as determined by CCC for the five years
preceding the 2004 crop year.
11. Revise Sec. 1427.1109 to read as follows:
Sec. 1427.1109 Payment rate.
The payment rate (dollars per ton) shall be determined by CCC by
dividing the total available program funds by the total eligible
payment quantity of cottonseed. However, in no event may the total
payment to an eligible applicant exceed $112 per ton of cottonseed
multiplied by the applicant's total eligible payment quantity.
12. Amend Sec. 1427.1111 by revising paragraph (d) to read as
follows:
Sec. 1427.1111 Liability of first handler.
* * * * *
(d) For three years after the date of the application for 2004-crop
payments, the applicant shall keep records, including records
supporting the quantity of cottonseed for which payment was requested,
and furnish such information and reports relating to the application to
CCC as requested. Such records shall be available at all reasonable
times for an audit or inspection by authorized representatives of CCC,
United States Department of Agriculture, or the Comptroller General of
the United States. Failure to keep, or make available, such records may
result in refund to CCC of all payments received, plus interest
thereon, as determined by CCC. In the event of a controversy concerning
payments, records must be kept for such longer period as may be
specified by CCC until such controversy is resolved. Destruction of
records at any time is at the risk of the applicant.
Signed in Washington, DC, on June 15, 2005.
James R. Little,
Executive Vice President, Commodity Credit Corporation.
[FR Doc. 05-12485 Filed 6-23-05; 8:45 am]
BILLING CODE 3410-05-P