[Federal Register Volume 67, Number 139 (Friday, July 19, 2002)]
[Proposed Rules]
[Pages 47477-47480]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-18218]



Commodity Credit Corporation

7 CFR Part 1470

RIN 0560-AG63

Apple Market Loss Assistance Payment Program II

AGENCY: Commodity Credit Corporation, USDA.

ACTION: Proposed rule with request for comments.


SUMMARY: This rule establishes the Apple Market Loss Assistance Payment 
Program II. The program will provide direct payments to apple producers 
to provide relief due to the low prices received for their 2000 crop.

DATES: Comments on this rule must be received on or before August 19, 
2002, to be assured consideration. Comments on the information 
collections in this rule must be received by September 17, 2002 to be 
assured consideration.

ADDRESSES: Comments should be mailed to Grady Bilberry, Director, Price 
Support Division (PSD), Farm Service Agency (FSA), United States 
Department of Agriculture (USDA), STOP 0512, 1400 Independence Avenue, 
SW, Washington, DC 20250-0512; telephone (202) 720-7901 or e-mail: 
[email protected]. Comments may be inspected in the Office of 
the Director, PSD, FSA, USDA, Room 4095 South Building, Washington, DC, 
between 8 a.m. and 4:30 p.m., Monday through Friday, except holidays. A 
copy of this proposed rule is available on the PSD home page at http://www.fsa.usda.gov/dafp/psd/.

FOR FURTHER INFORMATION CONTACT: Danielle Cooke, FSA; telephone (202) 


Executive Order 12866

    This proposed 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.

Regulatory Flexibility Act

    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 on 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 12988

    This rule has been reviewed in accordance with Executive Order 
12988. This rule preempts State laws that are inconsistent with this 
rule. Before any judicial action may be brought concerning this rule, 
the administrative remedies must be exhausted.

Executive Order 12372

    This program is not subject to Executive Order 12372, which 
requires 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 law to publish a notice of proposed 
rulemaking on the subject matter of this rule. Further, in any case, 
these provisions do not impose any mandates on state, local or tribal 
governments, or the private sector.

Federal Assistance Program

    The title and number of the Federal assistance program, as found in 
the Catalogue of Federal Domestic Assistance, to which this rule 
applies are: 10.075--Special Apple Program.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995, FSA has 
submitted an emergency information collection request to OMB for the 
approval of the Apple Market Loss Assistance Payment Program 
application as necessary for the proper functioning of the program.
    Title: Apple Market Loss Assistance Payment Program.
    OMB Control Number: 0560-0210.
    Type of Request: Request for a reinstatement, with change, of a 
previously approved collection for which approval has expired.
    Abstract: Apple operations are eligible to receive direct payments 
provided they make certifications that attest to their eligibility to 
receive such payments. As appropriate, these operations must certify: 
(1) The pounds of apples produced and harvested during the 2000 crop 
year; (2) receipt of no other payments by the apple operation for the 
market loss of apples from any other Federal program, except Federal 
Crop Insurance; and (3) that they understand the apple operation may be 
randomly selected by the Commodity Credit Corporation (CCC) to provide 
documentation during a spot check to verify claims. The information 
collection will be used by CCC to determine the program eligibility of 
apple operations. CCC considers the information collected essential to 
prudent eligibility determinations and payment calculations. 
Additionally, without accurate information on apple operations, the 
national payment rate would be inaccurate, payments could be made to 
ineligible recipients, and the integrity and accuracy of the program 
could be compromised.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 5 minutes per response.
    Respondents: Apple Operations.
    Estimated Number of Respondents: 10,000.
    Estimated Number of Responses per Respondent: 1.
    Estimated Total Annual Burden on Respondents: 10,840 hours.
    Proposed topics for comment include: (a) Whether the collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information will have practical 
utility; (b) the accuracy of the agency's estimate of burden including 
the validity of the methodology and assumptions used; (c) ways to 
enhance the quality, utility, and clarity of the information collected; 
or (d) ways to minimize the burden of the collection of the information 
on those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology. Comments should be 
sent to the Desk Officer for Agriculture, Office of Information and 
Regulatory Affairs, Office of Management and Budget, Washington, DC 
20503 and to Grady Bilberry, Director, Price Support

[[Page 47478]]

Division, Farm Service Agency, United States Department of Agriculture, 
STOP 0512, 1400 Independence Avenue, SW., Washington, DC 20250-0512 or 
telephone (202) 720-7901.

Executive Order 12612

    This rule does not have sufficient Federalism implications to 
warrant the preparation of a Federalism Assessment. The provisions 
contained in this rule will not have a substantial direct effect on 
States or their political subdivisions, or on the distribution of power 
and responsibilities among the various levels of government.


    Section 741 of Public Law 107-76 directs the Secretary of 
Agriculture to use $75 million of funds of the Commodity Credit 
Corporation (CCC) to provide assistance to producers for the 2000 crop 
of apple production.
    During the past few years a number of factors have produced a 
serious economic crisis that threatens the existence of apple producers 
throughout the United States. Apples are grown in every state in the 
continental United States, and are grown commercially in 36 states. 
Twenty years of increasing world production, stagnant domestic 
consumption, natural disasters and low-priced juice imports have 
altered the blueprint for economic success in the apple industry.
    This rule would address the situation by establishing a new 
program. The payments provided by this rule will offset a portion of 
the per-bushel losses producers have incurred marketing apples in the 
U.S. Those eligible will receive an immediate payment to help pay 
operating expenses and meet other financial obligations.
    The Act, as amended by Public Law 107-117, provides that producers 
of apples can receive a payment on a per-pound basis for 2000 crop 
production from a qualifying operation, up to a maximum of 5,000,000 
pounds per separate apple operation. To be eligible, apple producers 
must: (1) Have produced and harvested apples during the 2000 crop year, 
(2) not have received a payment from any other Federal program, other 
than crop insurance, for the same market loss, and (3) apply for cash 
payments during the application period for each apple operation. Public 
Law 107-76 also specified that benefits under the program would not be 
subject to limitations, other than those provided for in the statute. 
Therefore, producers do not have to be actively engaged in the business 
of producing and marketing agricultural products at the time of 
application if the producer was actively engaged during the 2000 crop 
year. At the close of the sign-up period, a national per-pound payment 
rate will be determined by dividing the available $75,000,000 by the 
total pounds of apples from all applicants, with no operation exceeding 
5,000,000 pounds. Because outlays for this program are fixed, the 
national average payment rate and individual payments can only be 
calculated after the total eligible quantity of apple production has 
been determined. Information provided on applications will be subject 
to verification by FSA. Applications to be verified will be selected 
randomly. Penalties for false certifications can be easily assessed and 
are expected to minimize such certifications. Apple operations may, 
during the applicable period, apply in person at FSA county offices 
during regular business hours. Alternatively, program applications may 
be obtained by mail, telephone, and facsimile from their designated FSA 
county office or obtained via the Internet. The Internet website is 
located at www.fsa.usda.gov/dafp/psd/.

List of Subjects in 7 CFR Part 1470

    Apple, Reporting and recordkeeping requirements.
    For the reasons set out in the preamble, 7 CFR part 1470 is 
proposed to be amended as follows:


    1. The authority citation for part 1470 is revised to read as 

    Authority: Sec. 811, Pub. L. 106-387, 114 Stat. 1549; Sec. 741, 
Pub. L. 107-76, 115 Stat. 704; Sec. 102, Pub. L. 107-117, 115 Stat. 

    2. Redesignate Secs. 1470.1 through 1470.16 as subpart A and add a 
heading for subpart A to read as follows:

Subpart A--Apple Market Loss Payment Program

    3. Add subpart B to part 1470 to read as follows:
Subpart B--Apple Market Loss Assistance Payment Program II
1470.101   Applicability.
1470.102   Administration.
1470.103   Definitions.
1470.104   Time and method of application.
1470.105   Eligibility.
1470.106   Proof of production.
1470.107   Availability of funds.
1470.108   Applicant payment quantity.
1470.109   Payment rate and apple operation payment.
1470.110   Offsets and withholdings.
1470.111   Assignments.
1470.112   Appeals.
1470.113   Misrepresentation and scheme or device.
1470.114   Estates, trusts, and minors.
1470.115   Death, incompetency, or disappearance.
1470.116   Maintenance and inspection of records.
1470.117   Refunds; joint and several liability.

Subpart B--Apple Market Loss Payment Program II

Sec. 1470.101  Applicability.

    (a) The regulations in this subpart are applicable to producers of 
the 2000 crop of apples. These regulations set forth the terms and 
conditions under which the Commodity Credit Corporation (CCC) shall 
provide payments to apple producers who have applied to participate in 
the Apple Market Loss Assistance Payment Program II in accordance with 
section 741 of Public Law 107-76, as amended by Public Law 107-117. 
Additional terms and conditions may be set forth in the payment 
application that must be executed by participants to receive a market 
loss payment for apples.
    (b) Payments shall be available only for apples produced and 
harvested in the United States.

Sec. 1470.102  Administration.

    (a) The Apple Market Loss Assistance Payment Program II shall be 
administered under the general supervision of the Executive Vice 
President, CCC (Administrator, FSA), or a designee, and shall be 
carried out in the field by FSA State and county committees (State and 
county committees) and FSA employees.
    (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 of this subpart.
    (c) The State committee shall take any action required by the 
regulations of this subpart that has not been taken by the county 
committee. The State committee shall also:
    (1) Correct, or require the county committee to correct, any action 
taken by such county committee that is not in accordance with the 
regulations of this subpart; and
    (2) Require a county committee to withhold taking any action that 
is not in accordance with the regulations of this subpart.
    (d) No provision or delegation of this subpart to a State or county 
committee shall preclude the Executive Vice President, CCC, or a 
designee, from determining any question arising under the program or 
from reversing or modifying any determination made by the State or 
county committee.

[[Page 47479]]

    (e) The Deputy Administrator, Farm Programs, FSA, may authorize 
State and county committees to waive or modify deadlines and other 
program requirements in cases where lateness or failure to meet such 
other requirements do not adversely affect the operation of the Apple 
Market Loss Assistance Payment Program II and does not violate 
statutory limitations on the program.
    (f) Payment applications and related documents not executed in 
accordance with the terms and conditions determined and announced by 
CCC, including any purported execution outside of the dates authorized 
by CCC, shall be null and void unless the Executive Vice President, 
CCC, shall otherwise allow.

Sec. 1470.103  Definitions.

    The definitions set forth in this section shall be applicable for 
all purposes of administering the Apple Market Loss Assistance Payment 
Program II established by this subpart.
    Administrator means the FSA Administrator.
    Apple operation means any person or group of persons who, as a 
single unit as determined by CCC, produces and market apples in the 
United States.
    Application means Form CCC-891, the Apple Market Loss Assistance 
Payment Application.
    Application period means the date established by the Deputy 
Administrator for producers to apply for program benefits.
    CCC means the Commodity Credit Corporation.
    County committee means the FSA county committee.
    County office means the local FSA office.
    Department or USDA means the United States Department of 
    Deputy Administrator means the Deputy Administrator for Farm 
Programs (DAFP), Farm Service Agency (FSA) or a designee.
    Eligible production means apples that were produced in the United 
States anytime during the 2000 crop year, up to a maximum of 5,000,000 
pounds per apple operation.
    Farm Service Agency or FSA means the Farm Service Agency of the 
    Payment pounds means the pounds of apples for which an operation is 
eligible to be paid under this subpart.
    Person means any individual, group of individuals, partnership, 
corporation, estate, trust association, cooperative, or other business 
enterprise or other legal entity who is, or whose members are, a 
citizen of, or legal resident alien or aliens in the United States.
    Secretary means the Secretary of the United States Department of 
Agriculture or any other officer or employee of the Department who has 
been delegated the authority to act in the Secretary's stead with 
respect to the program established in this part.
    United States means the 50 States of the United States of America, 
the District of Columbia, and the Commonwealth of Puerto Rico.
    Verifiable production records means evidence that is used to 
substantiate the amount of production reported and that can be verified 
by CCC through an independent source.

Sec. 1470.104  Time and method of application.

    (a) Apple producers may obtain an Application, in person, by mail, 
by telephone, or by facsimile from any county FSA office.
    (b) A request for benefits under this subpart must be submitted on 
a completed Application as defined in Sec. 1470.103. Applications 
should be submitted to the FSA county office serving the county where 
the apple operation is located but, in any case, must be received by 
the FSA county office by the close of business on the date established 
by the Deputy Administrator. Applications not received by the close of 
business on such date will be disapproved as not having been timely 
filed and the apple operation will not be eligible for benefits under 
this program.
    (c) All persons who share in the risk of an apple operation's total 
production must certify to the information on the Application before 
the Application will be considered complete.
    (d) The apple operation requesting benefits under this subpart must 
certify to the accuracy and truthfulness of the information provided in 
their application. All information provided is subject to verification 
by CCC. Refusal to allow CCC or any other agency of the Department of 
Agriculture to verify any information provided will result in a denial 
of eligibility. Furnishing the information is voluntary; however, 
without it program benefits will not be approved. Providing a false 
certification to the Government is punishable by imprisonment, fines 
and other penalties.

Sec. 1470.105  Eligibility.

    (a) To be eligible to receive a payment under this subpart, an 
apple operation must:
    (1) Have produced apples in the United States at some time during 
the 2000 crop year;
    (2) Not have been compensated for the same market loss by any other 
Federal programs, except an indemnity provided under a policy or plan 
of insurance offered under the Federal Crop Insurance Act (7 U.S.C. 
    (3) Apply for payments during the application period.
    (b) Payments may be made for losses suffered by an eligible 
producer who is now deceased or is a dissolved entity if a 
representative who currently has authority to enter into a contract for 
the producer signs the application for payment. Proof of authority to 
sign for the deceased producer or dissolved entity must be provided. If 
a producer is now a dissolved general partnership or joint venture, all 
members of the general partnership or joint venture at the time of 
dissolution, or their duly authorized representatives must sign the 
application for payment.
    (c) An apple operation must submit a timely application and comply 
with all other terms and conditions of this subpart and instructions 
issued by CCC, as well as comply with those instructions that are 
otherwise contained in the application to be eligible for benefits 
under this subpart.
    (d) All payments under this part are subject to the availability of 

Sec. 1470.106  Proof of production.

    (a) Apple operations selected for spot checks by CCC must, in 
accordance with instructions issued by the Deputy Administrator, 
provide adequate proof of the apples produced during the 2000 crop year 
to verify production. The documentary evidence of apple production 
claimed for payment shall be reported to CCC together with any 
supporting documentation under paragraph (b) of this section. The 2000 
crop year production must be documented using actual records.
    (b) All persons involved in such apple operation producing apples 
during the 2000 crop year shall provide any available supporting 
documents to assist the county FSA office in verifying the operation's 
apple production indicated on the Application. Examples of supporting 
documentation include, but are not limited to: picking, packout, and 
payroll records, RMA records, sales documents, copies of receipts, 
ledgers of income, or any other documents available to confirm the 
production and production history of the apple operation. In the event 
that supporting documentation is not presented to the county FSA office 
requesting the information, apple operations will be determined 
ineligible for benefits.

Sec. 1470.107  Availability of funds.

    The total available program funds shall be $75 million as provided 

[[Page 47480]]

section 741 of Public Law 107-76 except as determined appropriate by 
the Executive Vice President of CCC and authorized by law. Any 
discretion in such matters shall be the discretion of the Executive 
Vice President alone.

Sec. 1470.108  Applicant payment quantity.

    (a) The applicant's payment quantity of apples will be determined 
by CCC, based on the production of the 2000 crop of apples that was 
produced by each operation.
    (b) The maximum quantity of apples for which producers are eligible 
for a payment under this subpart shall be 5,000,000 pounds per distinct 
operation. The Deputy Administrator shall determine what may be 
considered a distinct operation and that decision shall be final.

Sec. 1470.109  Payment rate and apple operation payment.

    (a) A national per-pound payment rate will be determined after the 
conclusion of the application period, and shall be calculated, to the 
extent practicable, by dividing the $75 million available for the Apple 
Market Loss Assistance Payment Program II by the total pounds of 
eligible production approved for payment.
    (b) Each eligible apple operation's payment will be calculated by 
multiplying the payment rate determined in paragraph (a) of this 
section by the apple operation's eligible production.
    (c) In the event that approval of all eligible applications would 
result in expenditures in excess of the amount available, CCC shall 
reduce the payment rate in such manner as CCC, in its sole discretion, 
finds fair and reasonable.
    (d) A reserve may be created to handle claims but claims shall not 
be payable once the available funding is expended.

Sec. 1470.110  Offsets and withholdings.

    CCC may offset or withhold any amount due CCC under this subpart in 
accordance with the provisions of 7 CFR part 1403.

Sec. 1470.111  Assignments.

    Any person who may be entitled to a payment may assign his rights 
to such payment in accordance with 7 CFR part 1404 or successor 
regulations as designated by the Department.

Sec. 1470.112  Appeals.

    Any producer who is dissatisfied with a determination made pursuant 
to this subpart may make a request for reconsideration or appeal of 
such determination in accordance with the appeal regulations set forth 
at 7 CFR parts 11 and 780.

Sec. 1470.113  Misrepresentation and scheme or device.

    (a) An apple operation shall be ineligible to receive assistance 
under this program if it is determined by the State committee or county 
committee to have knowingly:
    (1) Adopted any scheme or device that tends to defeat the purpose 
of this program;
    (2) Made any fraudulent representation; or
    (3) Misrepresented any fact affecting a determination under this 
program. CCC will notify the appropriate investigating agencies of the 
United States and take steps deemed necessary to protect the interests 
of the government.
    (b) Any funds disbursed pursuant to this part to any person or 
operation engaged in a misrepresentation, scheme, or device, shall be 
refunded to CCC in accordance with Sec. 1470.117(a). The remedies 
provided in this subpart shall be in addition to other civil, criminal, 
or administrative remedies which may apply.

Sec. 1470.114  Estates, trusts, and minors.

    (a) Program documents executed by persons legally authorized to 
represent estates or trusts will be accepted only if such person 
furnishes evidence of the authority to execute such documents.
    (b) A minor who is otherwise eligible for assistance under this 
part must also:
    (1) Establish that the right of majority has been conferred on the 
minor by court proceedings or by statute;
    (2) Show that a guardian has been appointed to manage the minor's 
property and the applicable program documents are executed by the 
guardian; or
    (3) Furnish a bond under which the surety guarantees any loss 
incurred for which the minor would be liable had the minor been an 

Sec. 1470.115  Death, incompetency, or disappearance.

    In the case of death, incompetency, disappearance or dissolution of 
a person that is eligible to receive benefits in accordance with this 
part, such person or persons specified in part 707 of this chapter may 
receive such benefits, as determined appropriate by FSA.

Sec. 1470.116  Maintenance and inspection of records.

    (a) Persons making application for benefits under this program must 
maintain accurate records and accounts that will document that they 
meet all eligibility requirements specified herein, as may be requested 
by CCC. Such records and accounts must be retained for 3 years after 
the date of payment to the apple operation under this program. 
Destruction of the records 3 years after the date of payment shall be 
the risk of the party undertaking the destruction.
    (b) At all times during regular business hours, authorized 
representatives of CCC, the United States Department of Agriculture, or 
the Comptroller General of the United States shall have access to the 
premises of the apple operation in order to inspect, examine, and make 
copies of the books, records, and accounts, and other written data as 
specified in paragraph (a) of this section.
    (c) Any funds disbursed pursuant to this part to any person or 
operation who does not comply with the provisions of paragraphs (a) or 
(b) of this section, or who otherwise receives a payment for which they 
are not eligible, shall be refunded with interest.

Sec. 1470.117  Refunds; joint and several liability.

    (a) In the event of an error on an Application, a failure to comply 
with any term, requirement, or condition for payment arising under the 
Application, or this subpart, all improper payments shall be refunded 
to CCC together with interest and late payment charges as provided in 
part 1403 of this chapter.
    (b) All persons signing an apple operation's application for 
payment as having an interest in the operation shall be jointly and 
severally liable for any refund, including related charges, that is 
determined to be due for any reason under the terms and conditions of 
the application or this part with respect to such operation.

    Signed in Washington, DC, on June 28, 2002.
James R. Little,
Executive Vice President, Commodity Credit Corporation.
[FR Doc. 02-18218 Filed 7-18-02; 8:45 am]