[Federal Register: February 17, 2005 (Volume 70, Number 32)]
[Proposed Rules]
[Page 8043-8048]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17fe05-9]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1033
[Docket No. AO-166-A72; DA-05-01]
Milk in the Mideast Marketing Area; Notice of Hearing on Proposed
Amendments to Tentative Marketing Agreement and Order
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule; Notice of public hearing on proposed rulemaking.
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SUMMARY: A public hearing is being held to consider proposals that
would amend certain provisions of the Mideast Federal milk marketing
order. Proposals under consideration address: Eliminating the ability
of the same milk to be simultaneously pooled on the Mideast order and
on a State operated order with marketwide pooling; Changing the supply
plant performance standards and diversion limits; Increasing the number
of days a dairy farmer's milk production must be delivered to a pool
plant for the milk of the dairy farmer to be eligible for diversion;
Limiting the pooling of producer milk that was not pooled in a prior
month(s); Establishing a ``dairy farmer for other markets'' provision;
Establishing a transportation credit for milk; and Changing the
producer-handler definition.
DATES: The hearing will convene at 8:30 a.m. on Monday, March 7, 2005.
ADDRESSES: The hearing will be held at the Shisler Conference Center,
Ohio Agricultural Research and Development Center, 1625 Wilson Road,
Wooster, Ohio 44691, (330) 287-1424. Hotel accommodations can be made
at the Hilton Garden Inn Wooster, 959 Dover Road, Wooster, Ohio 44691,
(330) 202-7701.
FOR FURTHER INFORMATION CONTACT: Gino Tosi, Marketing Specialist, Order
Formulation and Enforcement Branch, USDA/AMS/Dairy Programs, Stop
0231--Room 2971, 1400 Independence Avenue, SW., Washington, DC 20250-
0231, (202) 690-1366, e-mail address: gino.tosi@usda.gov.
Persons requiring a sign language interpreter or other special
accommodations should contact Paul Huber at 330-225-4758 or via e-mail
at phuber@fmmaclev.com before the hearing begins.
SUPPLEMENTARY INFORMATION: This administrative action is governed by
the provisions of sections 556 and 557 of Title 5 of the United States
Code and,
[[Page 8044]]
therefore, is excluded from the requirements of Executive Order 12866.
Notice is hereby given of a public hearing to be held at the
Shisler Conference Center, Ohio Agricultural Research and Development
Center, 1625 Wilson Road, Wooster, Ohio 44691, (330) 287-1424,
beginning at 8:30 a.m., on Monday, March 7, 2005, with respect to
proposed amendments to the tentative marketing agreement and to the
order regulating the handling of milk in the Mideast milk marketing
area.
The hearing is called pursuant to the provisions of the
Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-
674), and the applicable rules of practice and procedure governing the
formulation of marketing agreements and marketing orders (7 CFR Part
900).
The purpose of the hearing is to receive evidence with respect to
the economic and marketing conditions that relate to the proposed
amendments, hereinafter set forth, and any appropriate modifications
thereof, to the tentative marketing agreement and to the order.
Actions under the Federal milk order program are subject to the
Regulatory Flexibility Act (5 U.S.C. 601 et seq.). This Act seeks to
ensure that, within the statutory authority of a program, the
regulatory and informational requirements are tailored to the size and
nature of small businesses. For the purpose of the Act, a dairy farm is
a ``small business'' if it has an annual gross revenue of less than
$750,000, and a dairy products manufacturer is a ``small business'' if
it has fewer than 500 employees. Most parties subject to a milk order
are considered as a small business. Accordingly, interested parties are
invited to present evidence on the probable regulatory and
informational impact of the hearing proposals on small businesses.
Also, parties may suggest modifications of these proposals for the
purpose of tailoring their applicability to small businesses.
The amendments to the rules proposed herein have been reviewed
under Executive Order 12988, Civil Justice Reform. They are not
intended to have a retroactive effect. If adopted, the proposed
amendments would not preempt any state or local laws, regulations, or
policies, unless they present an irreconcilable conflict with this
rule.
The Agricultural Marketing Agreement Act provides that
administrative proceedings must be exhausted before parties may file
suit in court. Under section 8c(15)(A) of the Act, any handler subject
to an order may request modification or exemption from such order by
filing with the Department of Agriculture (Department) a petition
stating that the order, any provision of the order, or any obligation
imposed in connection with the order is not in accordance with the law.
A handler is afforded the opportunity for a hearing on the petition.
After a hearing, the Department would rule on the petition. The Act
provides that the district court of the United States in any district
in which the handler is an inhabitant, or has its principal place of
business, has jurisdiction in equity to review the Department's ruling
on the petition, provided a bill in equity is filed not later than 20
days after the date of the entry of the ruling.
This public hearing is being conducted to collect evidence for the
record concerning the inequities among producers arising from order
provisions that allow reserve milk, which is used in cheese or butter
and nonfat dry milk production, to share in the benefits of pooling,
but does not require such milk to pool when there is a cost (when the
Class III price or Class IV price is above the blend price). Evidence
will also be collected to consider amending the order's supply plant
performance standards and diversion limitations to better identify the
milk of producers that should be eligible to receive the order's blend
price, increasing the number of days that a dairy farmer's milk
production would need to be delivered to a pool plant before such milk
would be eligible for diversion to nonpool plants but have such
diverted milk pooled on the order, establishing a transportation credit
to partially reimburse handlers for the cost of transporting milk
intended for use in Class I products, eliminating the ability to
simultaneously pool the same milk on the Mideast Federal order and on a
State operated order with marketwide pooling, and changing the
producer-handler definition for the order.
Interested parties who wish to introduce exhibits should provide
the Presiding Officer at the hearing with (4) copies of such exhibits
for the Official Record. Also, it would be helpful if additional copies
are available for the use of other participants at the hearing.
List of Subjects in 7 CFR Part 1033
Milk marketing orders.
The authority citation for 7 CFR Part 1033 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
The proposed amendments, as set forth below, have not received the
approval of the Department.
Proposed by Dairy Farmers of America, Inc., and Michigan Milk Producers
Association
Proposal No. 1
This proposal seeks to eliminate the ability of the same milk to be
pooled on the Mideast order and on a State operated order with
marketwide pooling.
1. Amend Sec. 1033.13 by adding a new paragraph (e), to read as
follows:
Sec. 1033.13 Producer milk.
* * * * *
(e) Producer milk shall not include milk of a producer that is
subject to a marketwide equalization pool under a milk classification
and pricing plan under the authority of a State government.
Proposed by Dairy Farmers of America, Inc., and Michigan Milk Producers
Association
Proposal No. 2
This proposal seeks to amend the order's pooling provisions by
changing the supply plant and the cooperative association operated
plant performance standards and diversion limit standards to better
identify the milk of producers who are providing consistent service to
the Class I needs of the Mideast milk marketing order.
1. Amend Sec. 1033.7 by revising paragraphs (c), (d) introductory
text, (d)(2) and (e)(1), to read as follows:
Sec. 1033.7 Pool Plant.
* * * * *
(c) A supply plant from which the quantity of bulk fluid milk
products shipped to, received at, and physically unloaded into plants
described in paragraph (a) or (b) of this section as a percent of the
Grade A milk received at the plant from dairy farmers (except dairy
farmers described in Sec. 1033.12(b)) and handlers described in Sec.
1000.9(c), as reported in Sec. 1033.30(a), is not less than 40 percent
of the milk received from dairy farmers, including milk diverted
pursuant to Sec. 1033.13, subject to the following conditions:
* * * * *
(d) A plant operated by a cooperative association if, during the
months of August through November 40 percent and during the months of
December through July 30 percent or more of the producer milk of
members of the association is delivered to a distributing pool plant(s)
or to a nonpool plant(s), and classification other than Class I is not
requested. Deliveries for qualification purposes may be made directly
from the farm or by transfer
[[Page 8045]]
from such association's plant, subject to the following conditions:
(1) * * *
(2) The 30 percent delivery requirement for December through July
may be met for the current month or it may be met on the basis of
deliveries during the preceding twelve (12) month period ending with
the current month.
* * * * *
(e) * * *
(1) The aggregate monthly quantity supplied by all parties to such
an agreement as a percentage of the producer milk receipts included in
the unit during the months of August through November is not less than
45 percent and during the months of December through July is not less
than 35 percent; and
* * * * *
2. Amend Sec. 1033.13 by revising paragraph (d)(4), to read as
follows:
Sec. 1033.13 Producer milk.
* * * * *
(d) * * *
(4) Of the total quantity of producer milk received during the
month (including diversions but excluding the quantity of producer milk
received from a handler described in Sec. 1000.9(c) or which is
diverted to another pool plant), the handler diverted to nonpool plants
not more than 50 percent in each of the months of August through
February and 60 percent in each of the months of March through July.
* * * * *
Proposed by Dean Foods Company
Proposal No. 3
This proposal seeks to amend the ``touch-base'' standard and
provide an exact definition for temporary loss of Grade A approval.
1. Amend Sec. 1033.13 by revising paragraphs (d)(1) through
(d)(3), to read as follows:
Sec. 1033.13 Producer milk.
* * * * *
(d) * * *
(1) Milk of a dairy farmer shall not be eligible for diversion
until milk of such dairy farmer has been physically received as
producer milk at a pool plant and the dairy farmer has continuously
retained producer status since that time. If a dairy farmer loses
producer status under the order in this part (except as a result of
loss of Grade A approval not to exceed 21 days in a calendar year,
unless it is determined by the market administrator to be unavoidable
circumstances beyond the control of the dairy farmer such as a natural
disaster (ice storm, wind storm, flood)) the dairy farmer's milk shall
not be eligible for diversion until milk of the dairy farmer has been
physically received as producer milk at a pool plant;
(2) The equivalent of at least four days milk production in each of
the months of August through November and two days milk production in
each of the months of December through January is caused by the handler
to be physically received at the pool plant;
(3) The equivalent of at least two days milk production is caused
by the handler to be physically received at a pool plant in each of the
months of February through July if the requirement of paragraph (d)(2)
of this section (Sec. 1033.13) in each of the prior months of August
through January are not met, except in the case of a dairy farmer who
marketed no Grade A milk during each of the prior months of August
through January.
* * * * *
Proposed by Ohio Dairy Producers and the Ohio Farmers Union
Proposal No. 4
This proposal seeks to establish a dairy farmer for other markets
provision that would encourage a year-round pooling commitment and
specify conditions for milk that was depooled to be repooled.
1. Amend Sec. 1033.12 by adding a new paragraph (b)(5), to read as
follows:
Sec. 1033.12 Producer.
* * * * *
(b) * * *
(5) For any month, any dairy farmer whose milk is received at a
pool plant or by a cooperative association handler described in Sec.
1000.9(c) if the pool plant operator or the cooperative association
caused milk from the same farm to be delivered to any plant as other
than producer milk, as defined in the order in this part or any other
Federal milk order, during the same month or any of the preceding 11
months, unless the equivalent of at least ten days milk production has
been physically received otherwise as producer milk at a distributing
plant during the month.
Proposed by Continental Dairy Products, Inc.
Proposal No. 5
This proposal seeks to limit the ability to pool the milk of a
producer on the order during the month if such milk had not been pooled
for at least twelve consecutive prior months.
1. Amend Sec. 1033.13 by revising the introductory paragraph and
adding a new paragraph (e), to read as follows:
Sec. 1033.13 Producer milk.
Except as provided in paragraph (e) of this section, producer milk
means the skim milk (or the skim equivalent of components of skim
milk), including nonfat components, and butterfat in milk of a producer
that is:
* * * * *
(e) Producer milk shall not include any milk which comes from a
dairy farm whose milk was not producer milk under the provisions of
this part during the previous twelve (12) months or Sec. --------.13
of any other Federal milk marketing order. This exception shall not
apply if
(1) Milk was not marketed from that farm during the previous 12
months in which case all milk that it did market for what ever part of
the preceding 12 months must have been producer milk.
(2) Milk was not marketed from that farm because the Grade A milk
producers permit was suspended during some of the period and the
producer did not market milk under any other grade of milk permit.
(3) Milk from the farm has not been producer milk for at least 12
consecutive months.
Proposed by Ohio Dairy Producers and the Ohio Farmers Union
Proposal No. 6
This proposal seeks to establish a dairy farmer for other markets
provision that would establish a maximum pooling limit of 115 percent
of a prior month's pooled milk volume that could be pooled in any
subsequent month.
1. Amend Sec. 1033.13 by adding a new paragraph (e), to read as
follows:
Sec. 1033.13 Producer milk.
* * * * *
(e) The quantity of milk reported by a handler pursuant to Sec.
1033.30(a)(1) and/or Sec. 1033.30(c)(1) may not exceed 115 percent of
the producer milk receipts pooled by the handler during the prior
month. Milk diverted to nonpool plants reported in excess of this limit
shall be removed from the pool by the market administrator. Milk
received at pool plants, other than pool distributing plants, shall be
classified pursuant to Sec. 1000.44(a)(3)(v) and Sec.
1000.44(b)(3)(v). The handler must designate, by producer pick-up,
which milk is to be removed from the pool. If the handler fails to
provide this information, the market administrator will make the
determination. The following provisions will apply:
(1) Milk shipped to and physically received at pool distributing
plants shall not be subject to the 115 percent limitation;
[[Page 8046]]
(2) Producer milk qualified pursuant to Sec. ------.13 of any
other Federal order and continuously pooled in any Federal order for
the previous six months shall not be included in the computation of the
115 percent limitation;
(3) The market administrator may waive the 115 percent limitation
utilizing;
(i) For a new handler on the order, subject to the provision of
Sec. 1033.13(e)(3), or
(ii) For an existing handler with significantly changed milk supply
conditions due to unusual circumstances;
(4) The market administrator may increase or decrease the
applicable limitation for a month consistent with the procedures in
Sec. 1033.7(g); and
(5) A bloc of milk may be considered ineligible for pooling if the
market administrator determines that handlers altered the reporting of
such milk for the purpose of evading the provisions of this paragraph.
Proposed by Dairy Farmers of America, Inc., and Michigan Milk Producers
Association
Proposal No. 7
This proposal, like Proposal 6, seeks to establish a dairy farmer
for other markets provision that would establish a maximum pooling
limit of 115 percent of a prior month's pooled milk volume that could
be pooled in a subsequent month. It has minor order language
differences from Proposal 6.
1. Amend Sec. 1033.13 by adding a new paragraph (e), to read as
follows:
Sec. 1033.13 Producer milk.
* * * * *
(e) The quantity of milk reported by a handler pursuant to Sec.
1033.30(a)(1) and/or Sec. 1033.30(c)(1) for the current month may not
exceed 115 percent of the producer milk receipts pooled by the handler
during the prior month. Milk diverted to nonpool plants reported in
excess of this limit shall not be producer milk. Milk received at pool
plants in excess of the 115 percent limit, other than pool distributing
plants, shall be classified pursuant to Sec. 1000.44(a)(3)(v). The
handler must designate, by producer pick-up, which milk shall not be
producer milk. If the handler fails to provide this information the
provisions of Sec. 1033.13(d)(6) shall apply. The following provisions
apply:
(1) Milk shipped to and physically received at pool distributing
plants and allocated to Class I use in excess of the prior month's
volume allocated to Class I use shall not be subject to the 115 percent
limitation;
(2) Producer milk qualified pursuant to Sec. ------.13 of any
other Federal order in the previous month shall not be included in the
computation of the 115 percent limitation, provided that the producers
comprising the milk supply have been continuously pooled on any Federal
order for the entirety of the most recent three consecutive months.
(3) The market administrator may waive the 115 percent limitation:
(i) For a new handler on the order, subject to the provisions of
Sec. 1033.13(e)(4), or
(ii) For an existing handler with significantly changed milk supply
conditions due to unusual circumstances;
(4) Milk may be considered ineligible for pooling if the market
administrator determines that handlers altered the reporting of such
milk for the purpose of evading the provisions of this paragraph.
Proposed by Dean Foods Company
Proposal No. 8
This proposal seeks to establish a dairy farmer for other markets
provision that would specify a 2-month to 7-month exclusion from the
pool if milk is depooled.
1. Amend Sec. 1033.12 by adding new paragraphs (b)(5) and (b)(6),
to read as follows:
Sec. 1033.12 Producer.
* * * * *
(b) * * *
(5) For any month of February through June, any dairy farmer whose
milk is received at a pool plant or by a cooperative association
handler described in Sec. 1000.9(c) if the pool plant operator or the
cooperative association caused milk from the same farm to be delivered
to any plant as other than producer milk, as defined under the order in
this part or any other Federal milk order, during the month, any of the
3 preceding months, or during any of the preceding months of July
through January, unless the equivalent of at least ten days' milk
production has been physically received otherwise as producer milk at a
pool distributing plant during the month; and
(6) For any month of July through January, any dairy farmer whose
milk is received at a pool plant or by a cooperative association
handler described in Sec. 1000.9(c) if the pool plant operator or the
cooperative association caused milk from the same farm to be delivered
to any plant as other than producer milk, as defined under the order in
this part or any other Federal milk order, during the month or the
preceding month unless the equivalent of at least ten days' milk
production has been physically received otherwise as producer milk at a
pool distributing plant during the month.
Proposed by Dairy Farmers of America, Inc.
Proposal No. 9
This proposal seeks to establish a transportation credit provision
on milk delivered from farms to pool distributing plants. The initial
75 miles and that portion of the milk movement beyond 400 miles would
not be eligible for the credit.
1. Add a new Sec. 1033.55, to read as follows:
Sec. 1033.55 Transportation credits.
(a) Each handler operating a pool distributing plant described in
Sec. 1033.7(a) or (b) that receives milk from dairy farmers, and each
handler described in Sec. 1033.9(c) that delivers milk to a pool
distributing plant described in Sec. 1033.7(a) or (b) shall receive a
transportation credit on the portion of such milk eligible for the
credit pursuant to paragraph (b) of this section.
(1) Transportation credits paid pursuant to paragraph (a)(1) and
(2) of this section shall be subject to final verification by the
market administrator pursuant to Sec. 1000.77.
(2) In the event that a qualified cooperative association is the
responsible party for whose account such milk is received and written
documentation of this fact is provided to the market administrator
pursuant to Sec. 1033.30(c)(3) prior to the date payment is due, the
transportation credits for such milk computed pursuant to this section
shall be made to such cooperative association rather than to the
operator of the pool plant at which the milk was received.
(b) Transportation credits shall apply to the pounds of bulk milk
received directly from the farms of producers at pool distributing
plants determined as follows:
(1) Determine the total pounds of producer milk physically received
at the pool distributing plant;
(2) Subtract from the pounds of milk described in paragraph (b)(1)
of this section the pounds of bulk milk transferred or diverted from
the pool plant receiving the milk if milk was transferred or diverted
to a nonpool plant on the same calendar day that the milk was received.
For this purpose, the transferred or diverted milk shall be subtracted
from the most distant load of milk received, and then in sequence
[[Page 8047]]
with the next most distant load until all of the transfers have been
offset; and
(3) Multiply the pounds determined in (b)(2) by the Class I
utilization of all producer milk at the pool plant operator as
described in Sec. 1000.44. The resulting pounds are the pounds upon
which transportation credits, as determined in paragraph (c) of this
section, shall be applicable.
(c) Transportation credits shall be computed as follows:
(1) Determine an origination point for each load of milk by
locating the county seat of the closest producer's farm from which milk
was picked up for delivery to the receiving pool plant;
(2) Determine the shortest hard-surface highway distance between
the receiving pool plant and the origination point;
(3) Subtract 75 miles from the lesser of the mileage so determined
in paragraph (c)(2) or 400 miles;
(5) Multiply the remaining miles so computed by 0.4 cent ($0.004);
(6) Subtract the Class I differential specified in Sec. 1000.52
applicable for the county in which the origination point is located
from the Class I differential applicable at the receiving pool plant's
location;
(7) Subtract any positive difference computed in paragraph (c)(6)
of this section from the amount computed in paragraph (c)(5) of this
section; and
(8) Multiply any positive remainder computed in paragraph (c)(7) by
the hundredweight of milk described is paragraph (b)(3) of this
section.
(d) The rate and mileage limits of paragraphs (c)(4) and (5) of
this section may be increased or decreased by the market administrator
if the market administrator finds that such adjustment is necessary to
better reflect actual conditions present in the marketplace. Before
making such a finding, the market administrator shall investigate the
need for adjustment either on the market administrator's own initiative
or at the request of interested parties. If the investigation shows
that an adjustment might be appropriate, the market administrator shall
issue a notice stating that an adjustment is being considered and
invite data, views, and arguments. Any decision to revise either figure
must be issued in writing at least one day before the effective date.
(e) For purposes of this section, the distances to be computed
shall be determined by the market administrator using the shortest
available state and/or Federal highway mileage. Mileage determinations
are subject to redetermination at all times. In the event a handler
requests a redetermination of the mileage pertaining to any plant, the
market administrator shall notify the handler of such redetermination
within 30 days after the receipt of such request. Any financial
obligation resulting from a change in mileage shall not be retroactive
for any periods prior to the redetermination by the market
administrator.
2. Amend Sec. 1033.60 by revising the introductory paragraph and
adding a new paragraph (k), to read as follows:
Sec. 1033.60 Handler's value of milk.
For the purpose of computing a handler's obligation for producer
milk, the market administrator shall determine for each month the value
of milk of each handler with respect to each of the handler's pool
plants and of each handler described in Sec. 1000.9(c) with respect to
milk that was not received at a pool plant by adding the amounts
computed in paragraphs (a) through (i) of this section and subtracting
from that total amount the value computed in paragraphs (j) and (k) of
this section. Unless otherwise specified, the skim milk, butterfat, and
the combined pounds of skim milk and butterfat referred to in this
section shall result from the steps set forth in Sec. 1000.44(a), (b),
and (c), respectively, and the nonfat components of producer milk in
each class shall be based upon the proportion of such components in
producer skim milk. Receipts of nonfluid milk products that are
distributed as labeled reconstituted milk for which payments are made
to the producer-settlement fund of another Federal order under Sec.
1000.76(a)(4) or (d) shall be excluded from pricing under this section.
* * * * *
(k) Compute the amount of credits applicable pursuant to Sec.
1033.55.
Proposed by Dairy Farmers of America, Inc., and Michigan Milk Producers
Association
Proposal No. 10
This proposal seeks to amend the current producer-handler
definition.
1. Revise Sec. 1033.10, to read as follows:
Sec. 1033.10 Producer-handler.
Producer-handler means a person who operates a dairy farm(s) and a
distributing plant(s) from which there is route disposition in the
marketing area and the total route disposition and transfers in the
form of packaged fluid milk products to other distributing plants
during the month does not exceed 3 million pounds (or such lesser
maximum volume that the record may so establish) and who provides proof
satisfactory to the market administrator that it meets all the
requirements of this section for designation.
(a) Requirements for designation. Designation of any person as a
producer-handler by the market administrator shall be contingent upon
meeting all the conditions set forth in paragraphs (a)(1) through (6)
of this section. Following the cancellation of a previous producer-
handler designation, a person seeking to have their producer-handler
designation reinstated must demonstrate that these conditions have been
met for the preceding month.
(1) The care and management of the dairy animals and other
resources and facilities designated in paragraph (b)(1) of this section
necessary to produce all Class I milk handled (excluding receipts from
handlers fully regulated under any Federal order) are under the
complete and exclusive control, and management of the producer-handler
and are operated as the producer-handler's own enterprise and its sole
risk.
(2) The plant operation designated in paragraph (b)(2) of this
section at which the producer-handler processes and packages, and from
which it distributes, its own milk production is under the complete and
exclusive control, and management of the producer-handler and is
operated as the producer-handler's own enterprise and at its sole risk.
(3) The producer-handler neither receives at its designated milk
production resources and facilities, nor receives, handles, processes,
or distributes at or through any of its designated milk handling,
processing, or distributing resources and facilities other source milk
products for reconstitution into fluid milk products or fluid milk
derived from any source other than:
(i) Its designated milk production resources and facilities (own
farm production);
(ii) Pool handlers and plants regulated under any Federal order
within the limitation specified in paragraph (c)(2) of this section; or
(iii) Nonfat milk solids which are used to fortify fluid milk
products.
(4) The producer-handler is neither directly nor indirectly
associated with the business control or management of, nor has a
financial interest in, another handler's operation; nor is any other
handler so associated with the producer-handler's operation.
(5) No milk produced by the herd(s) or on the farm(s) that supply
milk to the producer-handler's plant operation is:
(i) Subject to inclusion and participation in a marketwide
[[Page 8048]]
equalization pool under a milk classification and pricing program under
the authority of a State government maintaining marketwide pooling of
returns, or
(ii) Marketed in any part to a nonpool distributing plant.
(6) The producer-handler does not distribute fluid milk products to
a wholesale customer who is served by a plant described in Sec.
1033.7(a) and (b) or a handler described in Sec. 1000.8(c) that
supplied the same product in the same-sized package with a similar
label to a wholesale customer during the month.
(b) Designation of resources and facilities. Designation of a
person as a producer-handler shall include the determination of what
shall constitute the person's milk production, handling, processing,
and distribution resources and facilities, all of which shall be
considered an integrated operation.
(1) Milk production resources and facilities shall include all
resources and facilities (milking herd(s), buildings housing such
herd(s), and the land on which such buildings are located) used for the
production of milk which the producer-handler has designated as a
source of milk supply for the producer-handler's plant operation.
(2) Milk handling, processing, and distribution resources and
facilities shall include all resources and facilities (including store
outlets) used for handling, processing, and distributing fluid milk
products which are solely or partially owned by, and directly or
indirectly operated or controlled by the producer-handler or in which
the producer-handler in any way has an interest, including any
contractual arrangement, or over which the producer-handler directly or
indirectly exercises any degree of management or control.
(3) All designations shall remain in effect until canceled pursuant
to paragraph (c) of this section.
(c) Cancellation. The designation as a producer-handler shall be
canceled upon determination by the market administrator that any of the
requirements of paragraph (a)(1) through (6) of this section are not
met, or under any of the conditions described in paragraph (c)(1), (2)
or (3) of this section. Cancellation of a producer-handler's status
pursuant to this paragraph shall be effective on the first day of the
month in which the conditions were not met.
(1) Milk from the milk production resources and facilities of the
producer-handler, designated in paragraph (b)(1) of this section, is
delivered in the name of another person as producer milk to another
handler.
(2) The producer-handler handles fluid milk products derived from
sources other than the milk production facilities and resources
designation in paragraph (b)(1) of this section, except that it may
receive at its plant, or acquire for route disposition, fluid milk
products from fully regulated plants and handlers under any Federal
order if such receipts do not exceed 150,000 pounds monthly. This
limitation shall not apply if the producer-handler's own-farm
production is less than 150,000 pounds during the month.
(3) Milk from the milk production resources and facilities of the
producer-handler is subject to inclusion and participation in a
marketwide equalization pool under a milk classification and pricing
plan operating under the authority of a State government.
(d) Loss of producer-handler status. Notwithstanding paragraph (a)
of this section, loss of producer-handler status for exceeding the
limits in (c)(2) or for having more than three million pounds (or such
lesser maximum volume that the record may so establish) of total route
disposition and transfers in the form of packaged fluid milk products
to other distributing plants during the month shall only be effective
in the months where the limits are exceeded.
(e) Public announcement. The market administrator shall publicly
announce:
(1) The name, plant location(s), and farm locations(s) of persons
designated as producer-handlers;
(2) The names of those persons whose designations have been
cancelled; and
(3) The effective dates of producer-handler status or loss of
producer-handler status for each.
(f) Burden of establishing and maintaining producer-handler status.
The burden rests upon the handler who is designated as a producer-
handler to establish by proof satisfactory to the market administrator
through records required pursuant to Sec. 1000.27 that the
requirements set forth in paragraph (a) of this section have been met,
and that the conditions set forth in paragraph (c) of this section for
cancellation of the designation do not exist.
Proposed by Dairy Programs, Agricultural Marketing Service
Proposal No. 11
Make such changes as may be necessary to make the entire marketing
agreement and the order conform with any amendments thereto that may
result from this hearing.
Copies of this notice of hearing and the orders may be procured
from the Market Administrator of the aforesaid marketing area, or from
the Hearing Clerk, United States Department of Agriculture, Room 1083-
STOP 9200, 1400 Independence Avenue, SW., Washington, DC 20250-9200, or
may be inspected there.
Copies of the transcript of testimony taken at the hearing will not
be available for distribution through the Hearing Clerk's Office. If
you wish to purchase a copy, arrangements may be made with the reporter
at the hearing.
From the time that a hearing notice is issued and until the
issuance of a final decision in a proceeding, Department employees
involved in the decision-making process are prohibited from discussing
the merits of the hearing issues on an ex parte basis with any person
having an interest in the proceeding. For this particular proceeding,
the prohibition applies to employees in the following organizational
units:
Office of the Secretary of Agriculture;
Office of the Administrator, Agricultural Marketing Service;
Office of the General Counsel;
Dairy Programs, Agricultural Marketing Service (Washington Office)
and the Office of the Market Administrator of the Mideast Milk
Marketing Area.
Procedural matters are not subject to the above prohibition and may
be discussed at any time.
Dated: February 14, 2005.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 05-3070 Filed 2-14-05; 4:17 pm]
BILLING CODE 3410-02-P