Amendments to the Peanut Poundage Quota Regulations

DEPARTMENT OF AGRICULTURE

Farm Service Agency

7 CFR Part 729

RIN 0560-AE82

Amendments to the Peanut Poundage Quota Regulations

AGENCY: Farm Service Agency, USDA.

ACTION: Interim rule with request for comments.

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SUMMARY: This interim rule sets forth regulations for Federal farm

peanut poundage quotas in order to implement provisions of the

Agricultural Market Transition Act of 1996 (the 1996 Act) for the 1996

through 2002 crops of peanuts. The amendments to the regulations

adopted in this interim rule involve: eliminating the national poundage

quota floor; eliminating the undermarketing carryover provisions;

establishing temporary seed quota allocations; establishing the

ineligibility of certain farms for quota allocation; authorizing the

inter-county transfer of farm poundage quota in all States, subject to

certain percentage limitations on certain transfers in certain States;

eliminating the special allocations of increased quotas for certain

Texas counties; and establishing new provisions for ``considered-

produced'' credit with respect to a farm whose quota has been

transferred.

DATES: Effective April 4, 1996.

Comments must be received on or before August 15, 1996, to be

assured consideration.

ADDRESSES: Submit comments on the interim rule to: Director, Tobacco

and Peanuts Division, Farm Service Agency, U.S. Department of

Agriculture, Room 5750-S, Ag Code 0514, P.O. Box 2415, Washington, DC

20013-2415. All written submissions made pursuant to this rule will be

made available for public inspection in Room 5750 South Building, USDA,

between the hours of 8:15 a.m. and 4:45 p.m., during regular Federal

workdays.

FOR FURTHER INFORMATION CONTACT: David Kincannon, (202) 720-7914.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This interim rule has been determined to be significant and was

reviewed by OMB under Executive Order 12866.

Regulatory Flexibility Act

It has been determined that the Regulatory Flexibility Act is not

applicable to this interim rule because the Farm Service Agency (FSA)

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.

Unfunded Federal Mandates

This rule contains no Federal mandates (under the regulatory

provisions of Title II of the Unfunded Mandate Reform Act of 1995

(UMRA), for State, local, and tribal governments or the private sector.

Thus, this rule is not subject to the requirements of sections 202 and

205 of the UMRA.

Federal Assistance Program

The title and number of the Federal Assistance Program, as found in

the Catalog of Federal Domestic Assistance, to which this interim rule

applies are: Commodity Loans and Purchases--10.051.

Executive Order 12372

This program is not subject to the provisions of 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).

Executive Order 12778

This interim rule has been reviewed in accordance with Executive

Order 12778. The provisions of this interim rule do not preempt State

laws to the extent that such laws are inconsistent with the provisions

of this interim rule. Before any legal action is brought regarding

determinations made under provisions of 7 CFR part 729, the

administrative appeal provisions set forth at 7 CFR parts 11 and 780

must be exhausted. This rule has been made retroactive to April 4,

1996, in order to affirm determinations for the current crop year that

had to be made in advance of this notice because of the time of the

passage of the 1996 Act and the onset of the planting season for

peanuts.

National Appeals Division Rules of Procedure

The procedures set out in 7 CFR parts 11 and 780 apply to appeals

of adverse decisions made under the regulations adopted in this notice.

[[Page 36998]]

Small Business Regulatory Enforcement Fairness Act of 1996

Section 161(d) of the 1996 Act provides the regulation necessary to

implement Title I of the 1996 Act must be issued within 90 days of

enactment and that such regulations shall be issued without regard to

the notice and comment provisions of section 553 of the United States

Code. These regulations affect the immediate planting and marketing

decisions of an extraordinarily large number of agricultural producers

and previous decisions of the agency. Accordingly, as authorized by

section 808 of the Small Business Regulatory Enforcement Fairness Act

of 1996, this rule is effective as of April 4, 1996, the date of

enactment of the 1996 Act.

Paperwork Reduction Act

As provided in section 161(d) of the 1996 Act, the Paperwork

Reduction Act is not applicable to these regulations. However, the

forms necessary to conduct these programs have been previously

submitted for clearance to the Office of Management and Budget under

the provisions of 44 U.S.C. chapter 35.

Background

This rule addresses peanut quota amendments for the 1996 through

2002 crops which were enacted in section 155 of the 1996 Act.

A. Certain Farms Ineligible to Hold Peanut Poundage Quota

Section 358-1(b)(1) of the 1938 Act, as amended by the 1996 Act,

provides that, effective beginning with the 1998 crop of peanuts,

quotas shall not be established for farms owned or controlled by

municipalities, airport authorities, schools, colleges, refuges, and

other public entities (not including universities for research

purposes), or by a person who is not a producer and resides outside the

State in which the quota is allocated. Section 729.205 has been added

to the regulations accordingly and provides, consistent with the 1996

Act, that if a farm is ineligible for peanut poundage quota as of

August 1, 1997, under the provisions of the 1996 Act, the quota held by

such ineligible farms must be sold by October 1, 1997, or it will be

allocated to other farms within the same State, beginning with the next

crop year. Under the interim rule, if an ineligible party acquires a

quota farm after that date, no quota will be established for the farm,

but the quota, for subsequent crop years, may be sold to a qualifying

farm, provided that the normal conditions for sale are met.

B. Elimination of Quota Floor, Establishment of the National Poundage

Quota, and Peanut Quota Referendum

The 1996 Act provides for referenda for peanut quotas and amends

section 358-1(a)(1) of the 1938 Act to eliminate the floor for the

national quota. In addition, the 1996 Act excludes seed peanuts from

the calculation of the basic national quota. This rule revises section

729.216 (as redesignated) of the regulations accordingly.

C. Temporary Seed Quota Allocation

The 1996 Act amendments to the 1938 Act also, however, provide for

adding to a farm's basic quota a temporary allocation of quota for the

amount of seed peanuts planted on a farm. This rule amends the

definition of ``effective quota'' in section 729.103 of the regulations

accordingly.

This rule adopts a national seeding rate for each type of peanut

and provides that the quantity of temporary seed quota allocated to a

farm shall equal the amount determined by multiplying the acres planted

to peanuts by the national per-acre planting rate by peanut type. The

seed planted will be converted to farmers stock basis by multiplying,

by a factor of 1.5, the amount of seed so calculated. Another option

considered was setting a rate as a maximum with producers required to

prove actual seed purchases and use, with the lower of the standardized

maximum or the proven seed use establishing the seed quota allocation.

Comments are requested on these and any other options, and on: (a) the

issues of increased producer workload involved with proving seed use,

(b) the use of a standardized national seeding rate vs. a standardized

State seeding rate, and (c) the seeding rate amounts.

For purposes of determining seed use, the national per-acre

planting rate by type shall, for this calculation, be equal to:

(i) 95 pounds for Runner-type peanuts;

(ii) 110 pounds for Virginia peanuts;

(iii) 80 pounds for Spanish peanuts; and

(iv) 80 pounds for Valencia peanuts.

The temporary seed allocation will be made after the producer files

a proper certification of planted acres.

D. Elimination of ``Undermarketings'' From Quotas

In accord with the 1996 Act, this rule also eliminates previous

undermarketings from quota calculation for peanuts.

E. Reallocations in Texas of Increased Quota

The 1996 Act removes the special quota allocation provisions that

formerly applied to Texas only, in cases where the national quota is

increased. This rule amends section 729.206(f)(former 729.204(f)) of

the regulations, as redesignated, accordingly.

F. Inter-county Transfers

The 1996 Act removes the previous prohibition of inter-county quota

transfers in large-quota States to allow, with limits, the transfer of

farm poundage quota by sale or lease to any county within each of those

States. Such transfers are limited to an aggregate of 40 percent of the

total poundage quota within a county as of January 1, 1996, and may not

exceed a crop year limit of 15, 25, 30, and 35 percent for the 1996

through 1999 crops respectively and 40 percent for the 2000 and

subsequent crops. Further, however, in any county with a quota

allocation less than 50 tons for the preceding year's crop, all or any

part of a farm poundage quota may be transferred by sale or lease or

otherwise from a farm in the county to a farm in the same State. These

prescriptions are set by the 1996 Act.

This rule has adopted selection by lottery to implement the out-of-

county sale and lease limitation provisions in counties where the

amount of farm poundage quota requested for such sale and lease was

greater than the limitation for the current year. This rule amends

section 729.214 (former 729.212) of the regulations, as redesignated by

this rule, to implement the limitation requirements. Other options

considered with respect to administering the transfer limitation

included a first-come, first-considered basis and a proration of the

limited amount among all applicants. Time constraints and the

practicality of transferring only portions of a farm's quota were the

major determinants in selecting the lottery method. Comments are

requested on these or any other options for controlling the transfer

limitation and on the issue of giving priority to quota sales over

quota leases.

Also, current regulations in part 729 have prohibited the approval

of any transfers filed after January 31 and before August 1 if the

approval of such transfer would result in a transfer both to and from

either the transferring or receiving farm during such period. Although

this rule does not revise the regulation, comments are requested on

whether to allow a farm to make a transfer both ways in the same period

so

[[Page 36999]]

long as the transfer from the farm is a temporary transfer.

In addition, section 729.214(f)(3)(i), as redesignated, is amended

to ease the prohibition against permanent transfers of quota from a

farm to which quota had been transferred during the base period (the 3

immediately preceding crop years). The revised paragraph will limit the

prohibition to the amount of quota permanently transferred to the farm

during the 3-year period.

G. Considered-Produced Credit

Section 358-1(b) (3) and (4) of the 1938 Act provides that to the

extent practicable and on such fair and equitable basis as the

Secretary may provide, a farm will, generally, lose any quota which is

not produced or considered produced on the farm in 2 out of 3

consecutive years. That section contains a specific provision allowing

considered-produced credit for in-county transfers, but only once every

3 years. The new act leasing provisions in the 1996 Act, as indicated,

revamp the spring lease provisions for quotas and provide that the

transfer of quota under that paragraph will not reduce the quota of the

transferring farm if the quota is produced or considered produced on

the receiving farm. Since no change was made to the in-county transfer

provisions of 358-1(b)(3) (for those transfers which do not involve the

same owner or operator), it appears that the 1996 Act did not intend

for a modification to be made with respect to within-county transfers

as allowed prior to the 1996 Act. Accordingly, the interim rule

maintains the same considered-produced provisions, as in the past, for

such in-county transfers (that is, considered-produced credit for

leased quota will be allowed only once every 3 years). For inter-county

transfers, however, the rule allows the transferring farm to receive

considered-produced credit for any year in which the receiving farm

produces, or is considered to have produced, the quota. This is the

same rule that has been applied to out-of-county transfers in past

years when such transfers were only allowed in States with a small

total quota.

H. Other Provisions

The interim rule makes several technical changes including: (i)

changes necessitated by a recent USDA reorganization, and (ii) changes

to reflect applicability of the regulations through the 2002 crops.

Other provisions of the 1996 Act regarding peanuts will be the

subject of subsequent notices.

List of Subjects in 7 CFR Part 729

Peanuts, Penalties, Poundage quotas, Reporting and recordkeeping

requirements.

Interim Rule

Accordingly, 7 CFR Part 729 is amended as follows:

PART 729--[AMENDED]

1. The authority citation is revised to read as follows:

Authority: 7 U.S.C. 1301, 1357 et seq., 1372, 1373, 1375, and

7271.

2. Section 729.102 is amended by removing ``1991 through 1995'' and

adding ``1996 through 2002'' in its place, and by adding a sentence at

the end of the paragraph to read as follows:

Sec. 729.102 Applicability.

* * * The peanut marketing quota and disposition requirements for

peanuts for the 1991 through 1995 crops shall, as applicable, continue

to be governed by the regulations codified at 7 CFR Part 729, as of

April 1, 1996.

3. Section 729.103 is amended as follows:

a. The definition for ``FSA'' is moved to its proper place in

alphabetical order.

b. The definition of ``Considered-produced credit'' is amended by

revising paragraph (iii) to read as follows:

Sec. 729.103 Definitions.

* * * * *

(b) * * *

Considered-produced credit. * * *

(iii) A farm's basic quota that was not produced if the Farmers

Home Administration or the Farm Service Agency had control of, or title

to, such farm.

* * * * *

c. The definition of ``DASCO'' is removed, and the definition of

``Deputy Administrator'' is added in alphabetical order to read as

follows:

Deputy Administrator. The Deputy Administrator for Farm Programs,

Farm Service Agency.

d. The definition of ``Effective quota'' is amended by revising

paragraph (v) to read as follows:

Effective quota. * * *

(v) Temporary seed quota allocated to the farm.

e. The definition of ``First purchaser'' is added in alphabetical

order to read as follows:

First purchaser. Any person acquiring peanuts from a producer

except that in the case of peanuts forfeited by a producer to CCC or

bought from the price support loan inventory, the term means the person

acquiring the peanuts from CCC or the inventory.

f. The definition of ``Preliminary quota'' is revised to read as

follows:

Preliminary quota. For the current year and an eligible farm, the

basic quota established for the farm for the preceding year to the

extent that the farm is not subject to a reduction in quota.

g. The definition of ``Temporary seed quota'' is added in

alphabetial order to read as follows:

Temporary seed quota. Quota temporarily allocated for the current

crop year only and in an amount determined by FSA to account for the

amount of seed peanuts planted on the farm for production of peanuts,

excluding green peanuts and peanuts produced under the one-acre

exemption set forth in Sec. 729.306 of this part.

* * * * *

h. The definition of ``Undermarketings'' is removed.

4. Section 729.104(a) is revised to read as follows:

Sec. 729.104 Administration.

(a) The regulations in this part will be administered under the

general supervision of the Administrator, FSA, and shall be carried out

in the field by State and county FSA committees.

* * * * *

5. Section 729.104(c) is amended by removing the phrase ``committee

shall'' and adding ``committee'' in its place, and removing

``Instruct'' and adding ``Shall instruct'' in its place.

Sec. 729.108 [Amended]

6. Section 729.108 is amended by removing ``ASC'' and adding

``FSA'' in its place.

Sec. 729.201 [Amended]

7. Section 729.201 is amended by removing ``1991 through 1995''

wherever it appears and adding in its place ``1996 through 2002 and

removing ``1990'' wherever it appears and adding in its place``1995''.

Sec. 729.204-729.214 [Redesignated as Sec. 729.206-729.216]

8. Sections 729.204 through 729.214 are redesignated as sections

729.206 through 729.216 respectively, and new sections 729.204 and

729.205 are added to read as follows:

Sec. 729.204 Temporary seed quota allocation.

(a) Applicability. The temporary allocation of quota pounds, as

provided in this section shall be determined:

(1) For the marketing year only in which the crop is planted;

(2) For eligible producers for each of the 1996 through 2002

marketing years; and

[[Page 37000]]

(3) To exclude the production of green peanuts and peanuts produced

under the one-acre exemption provided for in 7 CFR 729.306.

(b) Quantity of allocation. The temporary quota allocated to a

producer shall be the farmers stock equivalent pounds of qualifying

seed peanuts considered planted on the farm as determined by FSA by

multiplying the acres determined planted to qualifying peanuts times

the per-acre planting rates of:

(1) 95 pounds for Runner-type peanuts;

(2) 110 pounds for Virginia peanuts;

(3) 80 pounds for Spanish peanuts; and

(4) 80 pounds for Valencia peanuts.

(c) Conversion factor. For the purpose of determining the farmers

stock basis for temporary seed quota allocations under this section,

the amount of seed planted as determined in accord with paragraph (b)

of this section shall be multiplied by a factor of 1.5.

(d) Time of notification. The notice of determination for temporary

seed quota allocations shall be made by the Deputy Administrator as

soon as practicable following the deadline for filing certifications of

planted acres.

Sec. 729.205 Farms ineligible for farm poundage quota.

(a) Ineligible farms. Except for quota allocated under the

provisions of Sec. 729.208 for experimental and research programs,

effective beginning with the 1998 crop year, farm poundage quotas shall

not be established for farms which are determined by FSA to be owned or

controlled by:

(1) Municipalities, airport authorities, schools, colleges,

refuges, and other public entities.

(2) A person:

(i) Who is not a peanut producer; and

(ii) Whose primary domicile, in the case of individual, or primary

place of business, in the case of an entity, as determined by FSA, is

located outside the State in which the quota is allocated.

(b) Determination of Residency and Related Rules. For purposes of

administering paragraph (a) of this section, with respect to farms

owned or controlled by a partnership or corporation or other entity,

the forfeiture in paragraph (a)(2) of this section shall not be deemed

to apply if a person or persons with at least a 20 percent interest in

any such entity are individuals whose primary residence is in the State

in which the quota is allocated; provided further, that paragraph

(a)(2) of this section shall not apply to any involuntary acquisition

of a farm by foreclosure, or otherwise, resulting directly from the

conduct of a public business in the State in which the quota is

allocated, or an acquisition resulting directly by reason of a death.

The exemption for involuntary farm acquisitions allowed under the

preceding sentence shall only apply to the establishment of quota in

the three crop years immediately following the date of the involuntary

acquisition of the quota farm. Further, for purposes of applying the

rules in paragraph (a) of this section as they regard production, the

determination of whether paragraph (a)(2) of this section applies shall

be made based on the crop last planted before the date on which the

determination is to be made.

(c) Allocating forfeited quota and sales of quotas subject to

paragraph (a). Any farm poundage quota held on or after August 1, 1997,

by an ineligible person as determined under paragraph (a) of this

section shall be allocated from the quota farm to other farms in the

same State in accordance with Sec. 729.206 of this part. In the event

that the ineligible party acquired the subject farm on or before August

1, 1997, such person shall have until October 1, 1997, to permanently

dispose of the quota by sale to another farm for subsequent crop years

in which case the transfer will be deemed to be effective as of August

1, 1997. If the farm in dispute was acquired after August 1, 1997, then

no quota shall be established for the farm until such time as the

ineligibility is removed provided further, however, that the quota may

be sold to another qualifying farm effective with the next crop year

following the sale or such later date as may be approved by FSA.

9. Redesignated Sec. 729.206 is amended:

a. In the heading of paragraph (f), by removing the phrase

``increased quota,'' and by removing the comma following the word

``nonproduction'';

b. In the first sentence of paragraph (f)(1), by removing the

phrase ``33 percent of any increase in the Texas peanut poundage quota

resulting from an increase in the national quota and'';

c. In paragraph (f)(3), by removing the phrase, ``, as determined

in accordance with paragraph (f)(2) of this section for the 1991

through 1995 crops'' and adding in its place ``granted under any

special rules for Texas under this section and its predecessor for the

1991 and subsequent crops''; and

d. In paragraph (f)(7), removing the phrase ``except for the 33

percent allocated to eligible Texas counties in accordance with

paragraph (f)(2) of this section,''.

10. Redesignated Sec. 729.207 is amended:

a. In paragraph (c), by removing ``Sec. 729.204(b)(2)'' and adding

``Sec. 729.206(b)(2)'' in its place;

b. In paragraph (d)(1)(ii)(B), by removing ``Sec. 729.212'' and

adding ``Sec. 729.214'' in its place; and

c. In paragraph (d)(2), by removing ``Sec. 729.204(e)'' and adding

``Sec. 729.206(e) in its place.

11. Redesignated Sec. 729.208 is amended by revising paragraph (d)

to read as follows:

Sec. 729.208 Allocation of quota for experimental and research

programs.

* * * * *

(d) Quota for 1996 through 2002 crops. For each institution with

continuing eligibility for which a 1995 basic quota was determined in

accordance with this section or its predecessor, a basic quota shall be

established for the 1996 through 2002 crops in the same manner as for

other farms within the State.

12. Redesignated Sec. 729.210 is amended by revising paragraph

(a)(1) to read as follows:

Sec. 729.210 Determining a farm's effective quota.

* * * * *

(a) Upward adjustment. * * *

(1) The temporary seed quota allocated to the farm;

* * * * *

13. Redesignated Sec. 729.213 is revised to read as follows:

Sec. 729.213 Erroneous notice of effective farm poundage quota.

If the official notice of effective quota issued for a farm

erroneously stated a quota larger than the correct effective quota, the

quota shown on the erroneous notice shall serve as the basis for

marketing penalty computations for the farm for the current marketing

year only if the county committee determines and the State Executive

Director concurs that:

(a) Extent of error. The error was not so substantial as to place

the operator on notice that such notice of quota was incorrect; and

(b) Response to notice. The operator, relying upon such notice and

acting in good faith:

(1) Has made plans, or is engaged in activities, to produce the

quota in the amount set forth on the erroneous notice (for example,

land preparation; purchase of seed, fertilizer, and other production

materials; or reducing the acreage of other crops); or

(2) Has planted the acreage of peanuts needed to produce the

erroneous farm poundage quota.

14. Redesignated Sec. 729.214 is revised:

[[Page 37001]]

a. In paragraph (a)(2) by removing ``with respect to the 1992 and

subsequent crops'';

b. By redesignating paragraphs (d) through (l) as (e) through (m);

and

c. By revising paragraph (c), adding a new paragraph (d), and

revising redesignated paragraphs (f)(1)(iii)(A), (f)(3)(i), and (l) to

read as follows:

Sec. 729.214 Transfer of quota by sale, lease, owner, or operator.

* * * * *

(c) Location of farms. In order to transfer poundage quota between

two farms, such farms must be located within the same State and, to the

extent required by paragraph (d) of this section, in the same county.

It is not necessary for the receiving farm to have had a basic quota in

the current or prior year, except as provided in paragraph (d)(4) of

this section.

(d) Limitations on transfer by sale or lease. Subject to the

provisions of paragraph (m) of this section:

(1) States with less than 10,000 tons of quota. With respect to

farms in any State for which the State's poundage quota for the year

preceding the current year was less than 10,000 tons, transfers of

peanut quota by sale or lease may be made to any other farm in any

county within the State.

(2) States with 10,000 tons or more of quota. For farms in States

with 10,000 tons or more of quota:

(i) Poundage quota may be transferred to any other farm within the

same county.

(ii) If the farm is in a county with less than a total of 50 tons

of quota, the poundage quota may be transferred to any other farm

within the same State without regard to the limitations set forth in

paragraph (d)(2)(iii) of this section.

(iii) If the farm is in a county with a total of 50 tons or more of

quota, poundage quota transferred out of county shall be limited to 40

percent of the quota in the transferring county as of January 1, 1996.

Further, the cumulative unexpired out-of-county transfers for a crop

year may not exceed the following percentages of the quota in the

transferring county as of January 1, 1996:

(A) 15 percent for the 1996 crop;

(B) 25 percent for the 1997 crop;

(C) 30 percent for the 1998 crop;

(D) 35 percent for the 1999 crop; and

(E) 40 percent for the 2000 and subsequent crops.

(iv) Selecting approved transfers. For purposes of administering

the limitations on the amount of transfers, the Director shall

establish a method for selecting, by lot, those applications which are

to be approved. The Director may give preference to permanent

transfers.

(3) Fall transfers. The limitations in paragraph (d)(2)(iii) of

this section do not apply to 1-year fall transfers, which may, in all

cases, be made to any farm in the same State, subject to such

restrictions as otherwise apply for fall transfers.

(4) Owner or operator transfer. Owner or operator transfers of

poundage quota are permitted to contiguous counties within the same

State without regard to the percentage limitations of paragraph

(d)(2)(iii) of this section; provided that, the receiving farm had a

basic quota established for the preceding year's crop and has the same

owner, in an owner transfer, or the same operator, in an operator

transfer.

* * * * *

(f) Other transfer provisions.--(1) Temporary transfer of quota

from a farm. * * *

(iii) Filed after July 31 and before February 1 (``Fall

transfers''). * * *

(A) The reported or determined acreage of peanuts plus prevented

planted credit for the transferring farm for the current year, when

multiplied by the larger of the farm yield or the highest actual yield

during the base period, is equal to or greater than 90 percent of the

farm's effective quota;

* * * * *

(3) Permanent transfer of quota from a farm. * * *

(i) Permanent transfer of quota to the farm. For the amount of

quota purchased or otherwise permanently transferred to the farm during

the base period, as adjusted for any increase or decrease in such quota

due to adjustment in the national quota during the base period.

* * * * *

(1) Adjustment of marketings. For the purpose of computing

production history for quota increase based on production, in the case

of temporary transfers by owner to the same owner or operator to the

same operator and all out-of-county transfers, if the current year's

produced or considered-produced credit from the receiving farm exceeds

such farm's basic quota, such produced or considered-produced credit on

the receiving farm shall be reduced by the amount of such excess, to

the extent of the quota temporarily transferred to such farm by owner

or operator, and such reduced amount shall be added to the current year

produced or considered-produced credit for the transferring farm.

* * * * *

Sec. 729.15 [Amended]

15. Redesignated Sec. 729.215 is amended in paragraph (f)(2) by

removing ``Sec. 729.204'' and adding ``Sec. 729.206'' in its place.

16. Redesignated Sec. 729.216 is revised to read as follows:

Sec. 729.216 National poundage quota.

(a) National poundage quota for 1996 and subsequent crop years. The

national poundage quota for the 1996 and subsequent crop years shall be

established by the Secretary at a level that is equal to the quantity

of peanuts that the Secretary estimates will be devoted in each

marketing year to domestic edible use (except seed), and related uses.

(b) Disapproval of quotas. No loan for quota peanuts may be made

available for any crop of peanuts with respect to which it is

determined by the Deputy Administrator that poundage quotas have been

disapproved by producers pursuant to a referendum conducted in

accordance with section 358-1(d) of the Agricultural Adjustment Act of

1938, as amended.

Signed at Washington, D.C., on July 5, 1996.

Bruce R. Weber,

Acting Administrator, Farm Service Agency.

[FR Doc. 96-17690 Filed 7-12-96; 2:18 pm]

BILLING CODE 3410-05-P