Milk in the Eastern Colorado Marketing Area; Notice of Proposed Suspension of Certain Provisions of the Order

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1137

[DA-97-05]

Milk in the Eastern Colorado Marketing Area; Notice of Proposed

Suspension of Certain Provisions of the Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed suspension of rule.

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SUMMARY: This notice invites written comments on a proposal to suspend

certain performance standards of the Eastern Colorado Federal milk

order. The suspension was requested by Mid-America Dairymen, Inc., a

cooperative association that supplies milk for the market's fluid

needs. The suspension was requested to prevent the uneconomic movement

of milk that otherwise would be required in order to maintain the

pooling status of milk that has been historically associated with the

order.

DATES: Comments are due no later than June 5, 1997.

ADDRESSES: Comments (two copies) should be filed with the USDA/AMS/

Dairy Division, Order Formulation Branch, Room 2968, South Building,

P.O. Box 96456, Washington, DC 20090-6456. Reference should be given to

the title of action and docket number.

FOR FURTHER INFORMATION CONTACT: Clifford M. Carman, Marketing

Specialist, USDA/AMS/Dairy Division, Order Formulation Branch, Room

2968, South Building, P.O. Box 96456, Washington, DC 20090-6456, (202)

720-9368, e-mail address: Clifford__M__C[email protected].

SUPPLEMENTARY INFORMATION: The Department is issuing this proposed rule

in conformance with Executive Order 12866.

This proposed rule has been reviewed under Executive Order 12988,

Civil Justice Reform. This rule is not intended to have a retroactive

effect. If adopted, this proposed rule will not preempt any state or

local laws, regulations, or policies, unless they present an

irreconcilable conflict with the rule.

The Agricultural Marketing Agreement Act of 1937, as amended (7

U.S.C. 601-674), provides that administrative proceedings must be

exhausted before parties may file suit in court. Under section

608c(15)(A) of the Act, any handler subject to an order may request

modification or exemption from such order by filing with the Secretary

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 law. A handler is afforded the opportunity for a hearing on the

petition. After a hearing, the Secretary 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 Secretary'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.

Small Business Consideration

In accordance with the Regulatory Flexibility Act (5 U.S.C. 601 et

seq.), the Agricultural Marketing Service has considered the economic

impact of this action on small entities and has certified that this

proposed rule will not have a significant economic impact on a

substantial number of small entities. For the purpose of the Regulatory

Flexibility Act, a dairy farm is considered a ``small business'' if it

has an annual gross revenue of less than $500,000, and a dairy products

manufacturer is a ``small business'' if it has fewer than 500

employees. For the purposes of determining which dairy farms are

``small businesses,'' the $500,000 per year criterion was used to

establish a production guideline of 326,000 pounds per month. Although

this guideline does not factor in additional monies that may be

received by dairy producers, it should be an inclusive standard for

most ``small'' dairy farmers. For purposes of determining a handler's

size, if the plant is part of a larger company operating multiple

plants that collectively exceed the 500-employee limit, the plant will

be considered a large business even if the local plant has fewer than

500 employees.

For the month of March 1997, the milk of 415 producers was pooled

on the Eastern Colorado Federal milk order. Of these producers, 308

producers were below the 326,000-pound production guideline and are

considered small businesses. During this same period, there were 10

handlers operating 11 pool plants under the Eastern Colorado order.

Five of these handlers would be considered small businesses.

This rule would lessen the regulatory impact of the order on

certain milk handlers and would tend to ensure that dairy farmers would

continue to have their milk priced under the order and thereby receive

the benefits that accrue from such pricing. This proposed suspension

will not result in any additional regulatory burden on handlers in the

Eastern Colorado marketing area since this suspension has been

continually in effect since 1985.

Interested parties are invited to submit comments on the probable

regulatory and informational impact of this proposed rule on small

entities. Also, parties may suggest modifications of this proposal for

the purpose of tailoring their applicability to small businesses.

Proposed Rule

Notice is hereby given that, pursuant to the provisions of the Act,

the suspension of the following provisions of the order regulating the

handling of milk in the Eastern Colorado marketing area is being

considered:

1. For the months of September 1, 1997, through February 28, 1998:

In the second sentence of Sec. 1137.7(b), the words ``plant which has

qualified as a'' and ``of March through August''; and

2. For the months of September 1, 1997, through August 31, 1998: In

the first sentence of Sec. 1137.12(a)(1), the words ``from whom at

least three deliveries of milk are received during the month at a

distributing pool plant''; and in the second sentence ``30 percent in

the months of March, April, May, June, July, and December and 20

percent in other months of'', and the word ``distributing''.

All persons who want to send written data, views or arguments about

the proposed suspension should send two copies of them to the USDA/AMS/

Dairy Division, Order Formulation Branch, Room 2971, South Building,

P.O. Box 96456, Washington, DC 20090-6456, by

[[Page 24611]]

the 30th day after publication of this notice in the Federal Register.

All written submissions made pursuant to this notice will be made

available for public inspection in the Dairy Division during normal

business hours (7 CFR 1.27(b)).

Statement of Consideration

The proposed rule would suspend certain portions of the pool plant

and producer definitions of the Eastern Colorado order. The proposed

suspension would make it easier for handlers to qualify milk for

pooling under the order.

The proposed suspension was requested by Mid-America Dairyman, Inc.

(Mid-Am), a cooperative association that has pooled milk of dairy

farmers on the Eastern Colorado order for several years. Mid-Am has

requested the suspension to prevent the uneconomic and inefficient

movement of milk for the sole purpose of pooling the milk of producers

historically associated with the Eastern Colorado order.

Mid-Am requests, for the months of September 1997 through February

1998, that the limit on the period of automatic pool plant status for a

supply plant that met pool shipping standards during the previous

September through February period be suspended. This provision has been

suspended annually for several years. Mid-Am also requests the

suspension of the touch-base and diversion limitation requirements

during the months of September 1997 through August 1998. These

requirements have been suspended since September 1985.

These provisions have been suspended previously in order to

maintain the pool status of producers who have historically supplied

the fluid needs of Eastern Colorado distributing plants. Mid-Am asserts

that they have made a commitment to meet the fluid requirements of

fluid distributing plants if the suspension request is granted. Without

the suspension action, Mid-Am contends that it will be necessary to

ship milk from distant areas to Denver area bottling plants. This will

displace locally produced milk that would then have to be shipped from

the Denver area to surplus handling plants.

In addition, Mid-Am maintains that ample supplies of locally

produced milk will be available to meet fluid needs without requiring

that each producer's milk be received at least three times each month

at a pool distributing plant or by restricting the amount of milk that

can be diverted to nonpool plants.

List of Subjects in 7 CFR Part 1137

Milk marketing orders.

The authority citation for 7 CFR Part 1137 continues to read as

follows:

Authority: 7 U.S.C. 601-674.

Dated: April 30, 1997.

Aggie Thompson,

Acting Director, Dairy Division.

[FR Doc. 97-11745 Filed 5-5-97; 8:45 am]

BILLING CODE 3410-02-P