[Code of Federal Regulations]
[Title 7, Volume 10]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1405.9]

[Page 362-363]
 
                          TITLE 7--AGRICULTURE
 
  CHAPTER XIV--COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE
 
PART 1405_LOANS, PURCHASES, AND OTHER OPERATIONS--Table of Contents
 
Sec.  1405.9  Commodity assessments.

    (a) CCC will deduct from the proceeds of a marketing assistance loan 
an amount equal to the amount of an assessment otherwise required to be 
remitted to a State agency under a State statute by the producer of the 
commodity pledged as collateral for such loan or by the first purchaser 
of such commodity subject to the requirements of paragraph (b) of this 
section.
    (1) The assessment will be collected in one of the following ways, 
as requested by the State, but not both:
    (i) When the proceeds of the loan are disbursed; or
    (ii) When the commodity pledged as collateral for the loan is 
forfeited to CCC, in which case CCC will collect from the producer the 
amount of the assessment submitted by CCC to the State.
    (2) CCC will deduct from the proceeds of a marketing assistance loan 
an amount equal to the amount of an assessment otherwise authorized to 
be remitted to a federally authorized entity under a Federal statute by 
the producer of the commodity pledged as collateral for such loan or the 
first purchaser of such commodity in the manner agreed to by CCC and the 
entity to whom the Secretary of Agriculture has authorized to collect 
such assessments.
    (b) CCC will collect commodity assessments authorized under a State 
statute when:
    (1) The State entity has:
    (i) Requested that the assessment be collected;
    (ii) Identified whether the assessment is to be collected at the 
time the loan proceeds are disbursed or at the time the commodity is 
forfeited to CCC;
    (iii) Identified the person who may enter into an agreement with CCC 
that sets forth the obligations of the State and CCC with respect to the 
collection of the assessment; and
    (iv) Provided an opinion from the Office of the Attorney General to 
CCC that concludes the person signing the agreement may obligate the 
State to comply with the agreement and the provisions of Public Law 108-
470 have been met.
    (2) The agreement described in paragraph (c) of this section has 
been executed by the appropriate State official and CCC.
    (c) CCC will enter into an agreement with an authorized State 
official to collect commodity assessments when the actions set forth in 
paragraphs (b)(1) and (2) of this section have been completed. Such 
agreement will contain the obligations and responsibilities of the State 
and CCC. All such agreements will include provisions that provide:
    (1) The State will indemnify CCC for any costs incurred in the 
collection of the assessment including costs incurred with respect to 
resolution of disputes arising from the requested collection of the 
assessment and for administrative costs incurred by CCC in the 
collection of the assessment;

[[Page 363]]

    (2) The State, in cases where an assessment has been collected two 
or more times with respect to the same quantity of the commodity subject 
to the assessment, will refund the amount of the excess collection to 
the producer.
    (3) The agreement may be terminated by either party upon 30 days 
notice.
    (4) The State, in cases where the marketing assistance loan is made 
by a cooperative marketing association or a designated marketing 
association approved by CCC, or any other similar entity that is 
approved by CCC, to obtain such a loan on behalf of its members may 
enter into individual arrangements with such entity to facilitate the 
collection of the assessment with the approval of CCC.

[70 FR 52285, Sept. 2, 2005]