[Code of Federal Regulations]
[Title 7, Volume 9]
[Revised as of January 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1005.82]

[Page 99-101]
 
                          TITLE 7--AGRICULTURE
 
  CHAPTER X--AGRICULTURAL MARKETING SERVICE (Marketing Agreements and 
                 Orders; Milk) DEPARTMENT OF AGRICULTURE
 
PART 1005_MILK IN THE APPALACHIAN MARKETING AREA--Table of Contents
 
                    Subpart_Order Regulating Handling
 
Sec. 1005.82  Payments from the transportation credit balancing fund.

    (a) Payments from the transportation credit balancing fund to 
handlers and cooperative associations requesting transportation credits 
shall be made as follows:
    (1) On or before the 13th day (except as provided in Sec. 1000.90) 
after the end of each of the months of July through December and any 
other month in which transportation credits are in effect pursuant to 
paragraph (b) of this section, the market administrator shall pay to 
each handler that received, and reported pursuant to Sec. 
1005.30(a)(5), bulk milk transferred from a plant fully regulated under 
another Federal order as described in paragraph (c)(1) of this section 
or that received, and reported pursuant to Sec. 1005.30(a)(6), milk 
directly from producers' farms as specified in paragraph (c)(2) of this 
section, a preliminary amount determined pursuant to paragraph (d) of 
this section to the extent that funds are available in the 
transportation credit balancing fund. If an insufficient balance exists 
to pay all of the credits computed pursuant to this section, the market 
administrator shall distribute the balance available in the 
transportation credit balancing fund by reducing payments prorata using 
the percentage derived by dividing the balance in the fund by the total 
credits that are due for the month. The amount of credits resulting from 
this initial proration shall be subject to audit adjustment pursuant to 
paragraph (a)(2) of this section.
    (2) The market administrator shall accept adjusted requests for 
transportation credits on or before the 20th day

[[Page 100]]

of the month following the month for which such credits were requested 
pursuant to Sec. 1005.32(a). After such date, a preliminary audit will 
be conducted by the market administrator, who will recalculate any 
necessary proration of transportation credit payments for the preceding 
month pursuant to paragraph (a) of this section. Handlers will be 
promptly notified of an overpayment of credits based upon this final 
computation and remedial payments to or from the transportation credit 
balancing fund will be made on or before the next payment date for the 
following month.
    (3) Transportation credits paid pursuant to paragraphs (a)(1) and 
(2) of this section shall be subject to final verification by the market 
administrator pursuant to Sec. 1000.77. Adjusted payments to or from 
the transportation credit balancing fund will remain subject to the 
final proration established pursuant to paragraph (a)(2) of this 
section.
    (4) 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. 1005.30(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) The market administrator may extend the period during which 
transportation credits are in effect (i.e., the transportation credit 
period) to the months of January and June if a written request to do so 
is received 15 days prior to the beginning of the month for which the 
request is made and, after conducting an independent investigation, 
finds that such extension is necessary to assure the market of an 
adequate supply of milk for fluid use. Before making such a finding, the 
market administrator shall notify the Director of the Dairy Division and 
all handlers in the market that an extension is being considered and 
invite written data, views, and arguments. Any decision to extend the 
transportation credit period must be issued in writing prior to the 
first day of the month for which the extension is to be effective.
    (c) Transportation credits shall apply to the following milk:
    (1) Bulk milk received from a plant regulated under another Federal 
order, except Federal Order 1007, and allocated to Class I milk pursuant 
to Sec. 1000.44(a)(9); and
    (2) Bulk milk received directly from the farms of dairy farmers at 
pool distributing plants subject to the following conditions:
    (i) The quantity of such milk that shall be eligible for the 
transportation credit shall be determined by multiplying the total 
pounds of milk received from producers meeting the conditions of this 
paragraph by the lower of:
    (A) The marketwide estimated Class I utilization of all handlers for 
the month pursuant to Sec. 1000.45(a); or
    (B) The Class I utilization of all producer milk of the pool plant 
operator receiving the milk after the computations described in Sec. 
1000.44;
    (ii) The dairy farmer was not a ``producer'' under this order during 
more than 2 of the immediately preceding months of February through May 
and not more than 50 percent of the production of the dairy farmer 
during those 2 months, in aggregate, was received as producer milk under 
this order during those 2 months; and
    (iii) The farm on which the milk was produced is not located within 
the specified marketing area of the order in this part or the marketing 
area of Federal Order 1007 (7 CFR part 1007).
    (d) Transportation credits shall be computed as follows:
    (1) The market administrator shall subtract from the pounds of milk 
described in paragraphs (c)(1) and (2) of this section the pounds of 
bulk milk transferred from the pool plant receiving the supplemental 
milk if milk was transferred to a nonpool plant on the same calendar day 
that the supplemental milk was received. For this purpose, the 
transferred milk shall be subtracted from the most distant load of 
supplemental milk received, and then in sequence with the next most 
distant load until all of the transfers have been offset.

[[Page 101]]

    (2) With respect to the pounds of milk described in paragraph (c)(1) 
of this section that remain after the computations described in 
paragraph (d)(1) of this section, the market administrator shall:
    (i) Determine the shortest hard-surface highway distance between the 
shipping plant and the receiving plant;
    (ii) Multiply the number of miles so determined by 0.35 cent;
    (iii) Subtract the applicable Class I differential in Sec. 1000.52 
for the county in which the shipping plant is located from the Class I 
differential applicable for the county in which the receiving plant is 
located;
    (iv) Subtract any positive difference computed in paragraph 
(d)(2)(iii) of this section from the amount computed in paragraph 
(d)(2)(ii) of this section; and
    (v) Multiply the remainder computed in paragraph (d)(2)(iv) of this 
section by the hundredweight of milk described in paragraph (d)(2) of 
this section.
    (3) For the remaining milk described in paragraph (c)(2) of this 
section after computations described in paragraph (d)(1) of this 
section, the market administrator shall:
    (i) Determine an origination point for each load of milk by locating 
the nearest city to the last producer's farm from which milk was picked 
up for delivery to the receiving pool plant;
    (ii) Determine the shortest hard-surface highway distance between 
the receiving pool plant and the origination point;
    (iii) Subtract 85 miles from the mileage so determined;
    (iv) Multiply the remaining miles so computed by 0.35 cent;
    (v) 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;
    (vi) Subtract any positive difference computed in paragraph 
(d)(3)(v) of this section from the amount computed in paragraph 
(d)(3)(iv) of this section; and
    (vii) Multiply the remainder computed in paragraph (d)(3)(vi) of 
this section by the hundredweight of milk described in paragraph (d)(3) 
of this section.

        Administrative Assessment and Marketing Service Deduction