[Federal Register: March 6, 2001 (Volume 66, Number 44)]
[Rules and Regulations]
[Page 13402-13407]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06mr01-6]
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DEPARTMENT OF AGRICULTURE
Commodity Credit Corporation
7 CFR Part 1421
RIN 0560-AG22
Grazing Payments for 2001 Wheat, Barley, or Oats
AGENCY: Commodity Credit Corporation; USDA.
ACTION: Final rule.
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SUMMARY: This rule implements provisions of the Agricultural Risk
Protection Act of 2000 (ARPA) related to grazing payments in lieu of
loan deficiency payments (LDP's), for the 2001 crop year only, to
include producers who elect to use acreage planted to wheat, barley, or
oats for the grazing by livestock and forgo any other harvesting of
such acreage.
[[Page 13403]]
EFFECTIVE DATE: March 6, 2001.
FOR FURTHER INFORMATION CONTACT: Raellen Erickson, Program Specialist,
Price Support Division, Farm Service Agency (FSA), USDA, STOP 0512,
1400 Independence Avenue, SW., Washington, DC 20250-0540, telephone:
(202) 720-7320.
SUPPLEMENTARY INFORMATION:
Notice and Comment
Section 263 of the ARPA requires that these regulations be
promulgated without regard to the notice and comment provisions of 5
U.S.C. 553 or the Statement of Policy of the Secretary of Agriculture
effective July 24, 1971, (36 FR 13804) relating to notices of proposed
rulemaking and public participation in rulemaking. These regulations
are thus issued as final.
Executive Order 12866
This final rule is issued in conformance with Executive Order 12866
and has been determined to be significant and has been reviewed by the
Office of Management and Budget.
Federal Assistance Programs
The titles and numbers of the Federal assistance programs, as found
in the Catalog of Federal Domestic Assistance, to which this final rule
applies is Commodity Loan Deficiency Payments--10.051.
Regulatory Flexibility Act
It has been determined that the Regulatory Flexibility Act is not
applicable to this rule because USDA 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 this rule.
Environmental Evaluation
It has been determined by an environmental evaluation that this
action will have no significant impact on the quality of the human
environment. Therefore, neither an environmental assessment nor an
Environmental Impact Statement is needed.
Executive Order 12372
This program is not subject to the provisions of Executive Order
12372, which require 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
The provisions of Title II of the Unfunded Mandates Reform Act of
1995 are not applicable to this rule because the USDA 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 this rule.
Small Business Regulatory Enforcement Fairness Act of 1996
Section 263 of the Act of 2000 requires that the regulations
necessary to implement Title II, Subtitle A of the Act of 2000 be
issued as soon as practicable and without regard to the notice and
comment provisions of 5 U.S.C. 553 or the Statement of Policy of the
Secretary of Agriculture effective July 24, 1971, (36 FR 13804) related
to the notice of proposed rulemaking and public participation in
rulemaking. It also requires the Secretary to use the provisions of 5
U.S.C. 808 (the Small Business Regulatory Enforcement Act (SBREFA),
which provide that a rule may take effect at such time as the agency
may determine if the agency finds for good cause that public notice is
impracticable, unnecessary, or contrary to the public purpose and thus
does not have to meet the requirements of section 801 of SBREFA
requiring a 60-day delay for Congressional review of a major regulation
before the regulation can go into effect. This final rule is considered
major for the purposes of SBREFA. Based on the foregoing authorities,
however, it has been determined that it would be contrary to the public
interest to delay the implementation of this rule. This rule,
accordingly, has been made effective immediately.
Paperwork Reduction Act
Section 263 of the Act of the ARPA also requires that these
regulations be promulgated and the program administered without regard
to the Paperwork Reduction Act. This means the information to be
collected from the public to implement these programs and the burden,
in time and money, the collection of the information would have on the
public, does not have to be approved by the Office of Management and
Budget.
Background
Producers of certain commodities are allowed by the provisions
under section 135 of the Agricultural Market Transition Act (7 U.S.C.
7235) and related provisions to obtain, upon harvest, market assistance
loans, or, in lieu of those loans, ``loan deficiency payments''
(LDP's). Section 205 of ARPA, however, provides additional relief for
farmers in a form which in effect amounts to the equivalent of an LDP.
Under section 205 of ARPA, a farmer who is otherwise eligible for a
wheat, barley, or oat LDP under section 135 of AMTA can graze the
acreage instead and still receive a payment if the producer enters into
an agreement with the Secretary to forgo any other harvesting of the
wheat, barley, or oats on that acreage. That section (Section 205 of
ARPA) provides further that the amount of the payment shall be
determined using the loan deficiency payment rate determined under
section 135(c) of the Agricultural Market Transition Act (7 U.S.C.
7235(c)) in effect, as of the date of the agreement, for the county in
which the farm is located. That rate, the statute provides, will be
multiplied by the payment quantity. The payment quantity, the law
provides, is determined by multiplying (for the commodity involved) the
quantity of the grazed acreage involved by the higher of the farm's
established yield or the county's average yield. Further, section 205
provides that the payment shall be made at the same time and in the
same manner as loan deficiency payments. Still further, the statute
specifies that the payment shall be made not later than September 30,
2001. Also, section 205 provides that, in operating this program, the
Secretary shall establish an availability period for the payment
consistent with the availability period for wheat, barley, and oats
established for AMTA marketing assistance loans. Section 205 further
specifies that the Secretary shall promulgate such regulations as are
needed to administer the payments in a fair and equitable manner with
respect to those producers of wheat and feed grains that will not
receive the new payments.
This rule implements those provisions by regulations that will be
codified in a new subpart in 7 CFR part 1421. In so doing, however,
several important determinations had to be made. Among those, was a
determination with respect to limitations on payments. LDPs under
section 135 of AMTA are, by the provisions of section 1001 of the Food
Security Act of 1985, 7 U.S.C. 1308, as amended, payment-limited. That
is, the amount that any one ``person'' (as defined in rules in 7 CFR
part 1400) can receive in any one program year, in the form of LDPs, is
limited to a set amount. By the terms of section 1001 of the Food
Security Act, the limit applies to payments under section 135 of AMTA,
and does not, for that reason, cover these new grazing payments, as
such, in section 205 of ARPA. That follows because section 205 does
not, as such, amend section 135 of AMTA. Rather,
[[Page 13404]]
section 205 is a stand-alone source of authority for making the new
payments. Nonetheless, as indicated above, Congress, by the terms of
section 205, instructs the agency to make the payment ``in the same
manner'' as section 135 of AMTA and further instructs the agency to
make the payments in such a way as to be fair with respect to farmers
who will not be making use of the new authority. For those reasons, it
seems clear that the payments should be treated as limited as well and,
in order to do so, it is provided in these rules that a farmer will be
considered to be eligible to receive, or retain, payments under section
205 of ARPA only to the extent that the farmer would have a remaining
eligibility for payments under section 135 of AMTA taking into account
the payment limit that applies to payment under that section. That is,
if the producer had for example hit the payment limit under that
section by receiving LDP's up to that limit, then the producer would
not be eligible for grazing payments under the new program and would,
if payments for grazing had already been received, be required to
return those payments with interest. This conclusion--linking the two
payments--is consistent with still another provision in section 205 of
ARPA that being the provision which specifies that the producer will
only be eligible for payments under section 205 to the extent that the
farmer would be eligible for a payment under section 135. While that
provision does not directly address the situation where the producer
was eligible for the payment when it was received and only later hits
the LDP payment limit, it would not make sense to have the rules allow
the farmer retain the grazing as such would change the connection
between the two programs from being a matter of substance to being one
of timing only. Presumably, placing form over substance was not
intended. Accordingly, once it has been determined that the grazing
payment will in effect be tied to the same payment limit it follows
that this rule will apply regardless of which payments were requested
first. As indicated, this seems to be fully consistent with the idea of
the statute which appear to be that the LDP program should not force
farmers to harvest forage of certain crops just to utilize their LDP
eligibility. Provision has been made in the rule to assure that the
connection between the two programs will be enforced irrespective of
whether the normal rules of offset would allow a charge-off between the
two programs.
Other provisions in the new regulations specify that producers will
not be eligible for the payment if the crop could not be harvested
anyway because of weather or other reasons. Also, the rules provide
that applications cannot be filed before the date on which mechanical
harvesting of the crop would, otherwise, have first been possible. This
provision is consistent with the timing provisions of the statute as
described above. Also, there are provisions, requiring consistency
between the producer's grazing reports and others that might be filed,
and a number of other aspects of the program as well. Further, since
the grazing payments allowed by the new rules only apply where the
producer could otherwise have obtained LDP for the crop, the new rules
will only apply to wheat, barley and oats crops produced by the
applicant on a farm on which that person has an existing and valid
production flexibility contract (PFC). That is because wheat, barley,
and oats are so-called ``contract commodities'' and, by statute,
generally, contract commodities are eligible for LDP only if produced
on a PFC farm. The PFC program is a program in which farmers with
certain crop bases under older programs can receive certain special
payments it they agreed to abide by certain limited conditions with
respect to the operation of their farms. The PFC program is
administered under 7 CFR part 12. For the 2000 crop only, Congress has
severed the tie between PFC's and LDP's. However, as the new grazing
payment program applies only to the 2001 crops wheat, barley, and oats,
the existence of a PFC contract will continue to be an eligibility
requirement for the new payment. Should the requirements for LDP's be
modified again, it would have to be determined whether such a change
would also expand eligibility for the new grazing payment provided for
in these new rules.
List of Subjects in 7 CFR Part 1421
Loan programs/Agriculture, Loan Deficiency Payment, Grazing
Payments for 2001 Crop of Wheat, Barley, or Oats, Reporting and
recordkeeping requirements.
Accordingly, 7 CFR part 1421 is amended to read as follows:
PART 1421--GRAINS AND SIMILARLY HANDLED COMMODITIES
1. The authority citation for part 1421 is revised to read as
follows:
Authority: 7 U.S.C. 7213-7235, 7237; 15 U.S.C. 714b, 714c; Sec.
813, Pub. L. 106-78, 113 Stat. 1182; Secs. 205 and 206, Pub. L. 106-
224 (7 U.S.C. 1421 note).
2. Part 1421 is amended by adding Subpart--Grazing Payments for
2001 Crop of Wheat, Barley, or Oats to read as follows:
Subpart--Grazing Payments for 2001 Crop of Wheat, Barley, or Oats
Sec.
1421.300 Applicability.
1421.301 Administration.
1421.302 Definitions.
1421.303 Eligible producer and eligible land.
1421.304 Time and method for application.
1421.305 Payment amount.
1421.306 Misrepresentation and scheme or device.
1421.307 Refunds; joint and several liability.
Sec. 1421.300 Applicability.
(a) The regulations in this subpart are applicable to 2001 crops of
eligible acreage planted to wheat, barley, or oats that is grazed by
livestock and not harvested in any other manner. This subpart sets
forth the terms and conditions under which a grazing payment in lieu of
a loan deficiency payment can be made by the Commodity Credit
Corporation (CCC).
(b) The form that is used in administering these payments is
available in State and county FSA offices and shall be prescribed by
CCC.
Sec. 1421.301 Administration.
(a) This subpart shall be administered by the Farm Service Agency
(FSA) under the general direction and supervision of the Executive Vice
President, CCC or designee. The program shall be carried out in the
field by State and county FSA employees under the general direction and
supervision of the State and county FSA committees.
(b) State and county committees, and representatives and employees
thereof, do not have the authority to modify or waive any of the
provisions of the regulations in this part, as amended or supplemented.
(c) The State committee shall take any action required by this part
which has not been taken by the county committee. The State committee
shall also:
(1) Correct, or require a county committee to correct, any action
taken by such county committee which is not in accordance with the
regulations of this part; or
(2) Require a county committee to withhold taking any action which
is not in accordance with the regulations of this part.
(d) No delegation herein to a State or county committee shall
preclude the
[[Page 13405]]
Executive Vice President, CCC, or a designee, from determining any
question arising under the program or from reversing or modifying any
determination made by a State or county committee.
(e) The Deputy Administrator for Farm Programs (DAFP), FSA, may
authorize State and county committees to waive or modify deadlines and
other program requirements in cases where timeliness or failure to meet
such other requirements does not adversely affect the operation of the
program. In addition, DAFP may establish other conditions for payments
that will assist in achieving the goals of the program and may include
such provisions in the program agreement or other program documents.
Sec. 1421.302 Definitions.
The definitions set forth in this section shall be applicable for
all purposes of program administration under this subpart:
COC means the FSA county office committee.
CCC means the Commodity Credit Corporation.
Department means the United States Department of Agriculture.
Deputy Administrator means the Deputy Administrator for Farm
Programs, Farm Service Agency (FSA) or a designee of that person.
FSA means the Farm Service Agency of the Department.
Secretary means the Secretary of the United States Department of
Agriculture, or the Secretary's delegate.
STC means the FSA State committee.
Sec. 1421.303 Eligible producer and eligible land.
(a) To be an eligible producer for purposes of this subpart, the
person must be a producer of an eligible crop which the producer agrees
under the terms of this part to graze in lieu of any other harvesting.
The only crops which are eligible for this program are the 2001 crops
of wheat, barley or oats, and then only if all other conditions for
eligibility under this part have met. For this purpose and all purposes
of this subpart, the ``person'' may be an individual, partnership,
association, corporation, estate, trust, or State or political
subdivision or agency thereof, or other legal entity. The crop year
will be determined using the normal designations that apply in
connection with farm commodity programs operated under this chapter.
Also, to be an eligible producer, the person must meet all other
qualifications for payment that are set out in this subpart, set out in
the program agreement, set out under other provisions of this title,
including regulations that appeal in parts 12, 718, 1400, and 1405 of
this title, or otherwise set out. A person will not be considered the
``producer'' of the crop unless that person was responsible for the
planting of the crop and had the risk of loss in the crop at all times
material to the request for payment, including, but not limited to, the
time of planting and the time of the request for, and payment of
benefits under, this part.
(b) A minor may participate in the program if the right of majority
has been conferred on the minor by court order or by statute, or if the
minor participates through a guardian authorized to act on the minor's
behalf in these matters. Alternatively, a minor may participate if the
program documents are all signed by an acceptable (to CCC) guarantor or
if bond, acceptable to CCC, is provided by a surety.
(c) For the crop to be eligible, the crop, in addition to other
standards that may apply, must be grown on land that is classified as
``cropland'' in FSA farm records or on land that FSA determines has
been cropped in the last 3 years except that the land may also qualify
if the land is committed to a crop rotation, normal for the locality,
that includes harvesting the subject crop for grain. These rules are
designed to assure, to the extent practicable, the available payment
did not produce plantings that otherwise would not have occurred and
the CCC may deny payments in any instance in which there is reason to
believe that the planting was done for that purpose. To that end, if
the commodity involved has not been previously grown by the producer or
is not one which is not predominately produced locally, the producer
must submit evidence of seed purchases for planting the commodities and
other evidence deemed needed or appropriate by the COC in order to
assure that the program goals are made and that the land was not
planted to an eligible commodity simply to obtain a payment. Also, the
land to be eligible must, for the year involved, be grazed and cannot,
during the crop year, be harvested at any time for any purpose, except
as determined by the Deputy Administrator to accommodate producers with
a history of double-cropping when the crop to be harvested is not the
crop for which a payment is to be made under this subpart. Land will be
considered grazed only to the extent that the crop on the land is
consumed in the field as live plants by livestock for the normal period
of time for grazing in the area.
(d) Further, the producers must have, to be eligible at the time
the crop is grown and used, full right of possession in the property
with the consent of the landowner and must have, but for an agreement
made to receive payments under this subpart, the right to harvest and
market the crop as grain and, as that time the crop is grazed, the
right and ability to obtain a loan deficiency payment (LDP) under this
title. Further, the producer must, at the time of the agreement made
under this part to obtain a payment, meet all other eligible criteria
for LDP's including the general statutory requirement that the producer
will eligible for LDP for ``contract commodities'' only if they were
produced by that person on the farm on which there is a ``production
flexibility contract'' (PFC) under the PFC program administered under 7
CFR part 1412. As wheat, barley and oats are contract commodities, this
means that no grazing payments will be made under this subpart unless
the wheat, barley or oat crop which is, or will be, grazed, was
produced by the person seeking the payment on land on which there is
PFC to which such person is party. In the event, that Congress, as it
did for the 2000 crop, change the requirements for LDP's so as to
eliminate the tie to an existing PFC, CCC shall determine whether that
waiver will also expand the eligibility of producers for grazing
payments under this subpart.
(e) In addition, no payment will be made if the crop could not have
been harvested and used to obtain LDP's because of weather or other
conditions that may have occurred or because of any legal restrictions
against harvesting the crop, or because of promises made in connection
with other programs, or because of any promise to any person, or
because of any other reason. The producer must, in addition, to be
considered eligible to receive a grazing payment on the commodity under
this subpart, retain the control, title and risk of loss in the
commodity for which the payment is sought from the date of planting
through the date on which no mechanical harvesting of the crop is still
possible. However, nothing in the prior sentence shall prevent a person
from receiving a payment merely because the producer has granted a
licence or permission to some other party to graze their animals upon
the property. In addition, the producer can receive no payment for any
crop on any land for which, for the relevant crop year, the producer
reported to anyone for any purpose, harvesting the crop for grain. This
prohibition and others under the program only apply to land for which
[[Page 13406]]
the payment is sought (that is, the part of the farm on which the crop
is to be grazed) and does not extend to other parts of the farm. Any
condition that applies under this subpart as a condition of payment,
shall also be considered to be a condition for retaining payment.
Sec. 1421.304 Time and method for application.
Application for the program must be received, at the county office
that is responsible for administering programs for the farm, no earlier
than the date on which eligible crops would, for the 2001 crop,
normally be harvested and no later than August 31, 2001. The
application must describe the land to be grazed and, in accordance with
standards set by CCC, the tract/field location. The COC will determine
the first harvest date which shall take into account the date on which
such crops are, locally, normally harvested for any purpose. Where
multiple producers are involved, the form must reflect each producer's
share in the crop. No producer must receive payments under this subpart
except to the extent that the payments are commensurate with that
share. Should a person who is entitled to receive a payment under this
subpart die, that payment, as earned, may be made to other persons as
provided for in the rules set out in part 707. Third parties may also
receive payments to the extent provided for in that part for other
situations involving an incapacitation of the producer. Refusals to
allow CCC to verify information on any form or report utilized for this
subpart can result in program ineligibility and producers must provide
CCC and its agent to the property involved and to all records as may be
relevant to the making of payments under this subpart. Further, false
statements will disqualify the producer from the program and may be
subject to other sanctions including criminal sanctions.
Sec. 1421.305 Payment amount.
(a) Eligible persons growing an eligible crop and agreeing to the
restrictions provided for in this subpart may (if all other conditions
of eligibility are met) receive a payment under this subpart. That
payment for purposes of this section shall be referred to as a
``grazing payment''. The grazing payment shall be made at the per/unit
LDP rate for the relevant crop. The LDP rate that applies shall be that
which is current on the date on which the producer submits a complete
program application or is deemed, by CCC, to have submitted a completed
application. The rate shall be the rate for the relevant county in
which the farm is located. The ``LDP rate'' for this purpose means the
rate for ``loan deficiency payments'' under this subpart. The LDP rate
shall be applied against the payable units of production as determined
under this section.
(b) The payable units of production shall be computed by
multiplying the eligible grazed acres by the applicable yield
determined under paragraph (c) of this section.
(c) The yield shall be either the farm's established yield for the
crop as determined under part 1412 by the FSA or the relevant average
county yield as determined by the FSA. The average county yield must be
established by the COC by August 31, 2001, but shall be valid only if
the STC concurs. That yield shall, if acceptable data is available, be
based on NASS data using an Olympic average for the 1996 through 2000
crop years. If that data is not available, or STC does not concur,
other sources may be used.
(d) No payment may be received or retained under this subpart to
the extent that the payment, were they considered to be LDP's, would
place that person over the per person per year payment limit that
applies to LDP's. The producer agrees that the CCC may collect any
payment considered to be an overpayment by reason of this subsection by
withholding LDP payments until the matter is resolved, by treating the
LDP as being not payable to the extent that a grazing refund would
otherwise be due , by setoff, or by any other means available to CCC.
(e) Payments can be withheld until the actual grazed acreage is
verified and justified in connection with any other reports filed with
FSA with respect to the farm (or filed with some other person or
agency) and until all other necessary information is obtained. The CCC
may require such other verification as it deems appropriate to assure
that the program goals are met.
(f) To receive the payment, the eligible producer must submit a
request for payment on the FSA-approved form. That form will be ``CCC-
633 Grazing (Grazing Payment Program Application)''. The form may be
obtained from the county FSA office. Also, a copy may be obtained at
http://www.fsa.usda.gov/dafp/psd. The form must be submitted to the
county by the close of business on August 31, 2001.
(g) The producer will ineligible for payments under this subpart if
any discrepancies between the reported acreage on the program form and
other reports of acreage by the producer are not resolved by a date set
by the CCC.
(h) Unless otherwise authorized by the Deputy Administrator, all
payment shall be made no later than September 28, 2001.
Sec. 1421.306 Misrepresentation and scheme or device.
(a) A producer shall be ineligible to receive payments under this
subpart if it is determined by DAFP, the State committee, or the county
committee to have:
(1) Adopted any scheme or device which tends to defeat the purpose
of this program;
(2) Made any fraudulent representation; or
(3) Misrepresented any fact affecting a program determination.
(b) Any funds disbursed pursuant to this subpart to a producer
engaged in a misrepresentation, scheme, or device, or to any other
person as a result of the producer's actions, shall be refunded with
interest together with such other sums as may become due. Any producer
engaged in acts prohibited by this section and any person receiving
payment under this subpart, as a result of such acts, shall be jointly
and severally liable for any refund due under this section and for
related charges. The remedies provided in this subpart shall be in
addition to other civil, criminal, or administrative remedies which may
apply.
Sec. 1421.307 Refunds; joint and several liability.
(a) In the event there is a failure to comply with any term,
requirement, or condition for payment arising under this application,
or this subpart, and if any refund of a payment to CCC shall become due
for that or other reason in connection with the application, or this
subpart, all payments made under this subpart to any producer shall be
refunded to CCC together with interest as determined in accordance with
paragraph (c) of this section and late-payments charges as provided for
in part 1402 of this chapter.
(b) All persons listed on an application shall be jointly and
severally liable for any refund due in connection with that application
and for any related charges which may be determined to be due for any
reason.
(c) Interest shall be applicable to refunds required of the
producer. Such interest shall be charged at the rate of interest which
the United States Treasury charges CCC for funds, as of the date CCC
made such benefits available. Such interest shall accrue from the date
such benefits were made available to the date of repayment but the
interest rate shall increase to reflect
[[Page 13407]]
any increase in the rate charged to CCC by Treasury for any percent of
time for which the interest assessment is collected. CCC may waive the
accrual of interest if CCC determines that the cause of the erroneous
determination was not due to any action of the producer.
(d) Late payment interest shall be assessed on refunds in
accordance with the provisions of, and subject to the rates in 7 CFR
part 1403.
(e) Producers must refund to CCC any excess payments made by CCC
with respect to any application in which they have an interest. Such
refund shall be subject to interest at the same rate that applies to
other refunds.
Signed at Washington, D.C., on March 1, 2001.
Diane Sharp,
Executive Vice President, Commodity Credit Corporation.
[FR Doc. 01-5492 Filed 3-2-01; 3:18 pm]
BILLING CODE 3410-05-P
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