Beef Promotion and Research Order
Subpart A--Beef Promotion and Research Order Definitions
Sec.1260.101 Department.
1260.102 Secretary.
1260.103 Board.
1260.104 Committee.
1260.105 Person.
1260.106 Collecting person.
1260.107 State.
1260.108 United States.
1260.109 Unit.1260.110 [Reserved]
1260.111 Fiscal year.
1260.112 Federation.
1260.113 Established national nonprofit industry-governed
organizations.
1260.114 Eligible organization.
1260.115 Qualified State beef council.
1260.116 Producer.
1260.117 Importer.
1260.118 Cattle.
1260.119 Beef.
1260.120 Beef products.
1260.121 Imported beef or beef products.
1260.122 Promotion.
1260.123 Research.
1260.124 Consumer information.
1260.125 Industry information.
1260.126 Plans and projects.
1260.127 Marketing.
1260.128 Act.
1260.129 Customs Service.
1260.130 Part and subpart.
Cattlemen's Beef Promotion and Research Board 1260.141 Membership of Board. 1260.142 Term of office. 1260.143 Nominations. 1260.144 Nominee's agreement to serve. 1260.145 Appointment. 1260.146 Vacancies. 1260.147 Procedure. 1260.148 Compensation and reimbursement. 1260.149 Powers of the Board. 1260.150 Duties of the Board. 1260.151 Expenses.
Beef Promotion Operating Committee
1260.161 Establishment and membership.
1260.162 Term of office.
1260.163 Vacancies.
1260.164 Procedure.
1260.165 Compensation and reimbursement.[[Page 180]]
1260.166 Officers of the Committee.
1260.167 Powers of the Committee.
1260.168 Duties of the Committee.
1260.169 Promotion, research, consumer information and industry
information.
Assessments 1260.172 Assessments. 1260.173-1260.174 [Reserved] 1260.175 Late-payment charge. 1260.176 Adjustment of accounts. 1260.181 Qualified State beef councils.
Reports, Books and Records 1260.201 Reports. 1260.202 Books and records. 1260.203 Confidential treatment.
Miscellaneous 1260.211 Proceedings after termination. 1260.212 Effect of termination or amendment. 1260.213 Removal. 1260.214 Personal liability. 1260.215 Patents, copyrights, inventions and publications. 1260.216 Amendment. 1260.217 Separability.
Subpart B--Rules and Regulations
1260.301 Terms defined.
1260.310 Domestic assessments.
1260.311 Collecting persons for purposes of collection of
assessments.
1260.312 Remittance to the Cattlemen's Board or Qualified
State
Beef Council.
1260.313 Document evidencing payment of assessments.
1260.314 Certification of non-producer status for certain
transactions.
1260.315 Qualified State Beef Councils.
1260.316 Paperwork Reduction Act assigned number.
Subpart C--[Reserved]
Subpart D--Beef Promotion and Research: Certification and
Nomination
Procedures for the Cattlemen's Beef Promotion and Research Board
1260.500 General.
1260.510 Definitions.
1260.520 Responsibility for administration of regulations.
1260.530 Certification of eligibility.
1260.540 Application for certification.
1260.550 Verification of information.
1260.560 Review of certification.
1260.570 Notification of certification and the listing of
certified
organizations.
1260.580-1260.600 [Reserved]
1260.610 Acceptance of appointment.
1260.620 Confidential treatment of information.
1260.630 Paperwork Reduction Act assigned number.
1260.640 Application for Certification Form.
Authority: 7 U.S.C. 2901-2911.
Subpart A--Beef Promotion and Research Order Source: 51 FR 26138, July 18, 1986, unless otherwise noted. DefinitionsSec. 1260.101 Department. ``Department'' means the United States Department of Agriculture. Sec. 1260.102 Secretary. ``Secretary'' means the Secretary of Agriculture of the United States or any other officer or employee of the Department to whom there has heretofore been delegated, or to whom there may hereafterbe delegated, the authority to act in the Secretary's stead.
Sec. 1260.103 Board.
``Board'' means the Cattlemen's Beef Promotion and Research
Board established pursuant to the Act and this subpart.
Sec. 1260.104 Committee.
``Committee'' means the Beef Promotion Operating Committee
established pursuant to the Act and this subpart.
Sec. 1260.105 Person.
``Person'' means any individual, group of individuals,
partnership, corporation, association, cooperative, or any other
entity.
Sec. 1260.106 Collecting person.
``Collecting person'' means the person making payment to a
producer for cattle, or any other person who is responsible for
collecting and remitting an assessment pursuant to the Act, the
order and regulations prescribed by the Board and approved by the
Secretary.
Sec. 1260.107 State.
``State'' means each of the 50 States.
Sec.1260.108 United States.
``United States'' means the 50 States and the District of
Columbia.
Sec. 1260.109 Unit.
``Unit'' means each State, group of States or class
designation which is represented on the Board.Sec.
1260.110 [Reserved]
Sec. 1260.111 Fiscal year.
``Fiscal year'' means the calendar year or such other annual
period as the Board may determine.
Sec. 1260.112 Federation.
``Federation'' means the Beef Industry Council of the National
Live Stock and Meat Board, or any successor organization to the
Beef Industry Council, which includes as its State affiliates the
qualified State beef councils.
Sec.1260.113 Established national nonprofit industry-governed
organizations.
``Established national nonprofit industry-governed
organizations''
means organizations which:
(a) Are nonprofit organizations pursuant to sections 501(c)
(3), (5) or (6) of the Internal Revenue Code (26 U.S.C. 501(c)
(3), (5) and (6)); (b) Are governed by a board of directors
representing the cattle or beef industry on a national basis;
and
(c) Were active and ongoing before the enactment of the Act.
Sec. 1260.114 Eligible organization.
``Eligible organization'' means any organization which has
been certified by the Secretary pursuant to the Act and this
part as being eligible to submit nominations for membership on
the Board.
Sec. 1260.115 Qualified State beef council.
``Qualified State beef council'' means a beef promotion
entity that is authorized by State statute or a beef promotion
entity organized and operating within a State that receives
voluntary assessments or contributions; conducts beef
promotion, research, and consumer and industry information
programs; and that is certified by the Board pursuant to this
subpart as the beef promotion entity in such State.
Sec. 1260.116 Producer.
``Producer'' means any person who owns or acquires ownership
of cattle; provided, however, that a person shall not be
considered a producer within the meaning of this subpart if
(a) the person's only share in the proceeds of a sale of cattle
or beef is a sales commission, handling fee, or other
service fee; or (b) the person
(1) acquired ownership of cattle to facilitate the transfer of
ownership of such cattle from the seller to a third party,
(2) resold such cattle no later than ten (10) days from the date
on which the person acquired ownership, and
(3) certified, as required by regulations prescribed by the
Board and approved by the Secretary, that the requirements of
this provision have been satisfied.
Sec. 1260.117 Importer.
``Importer'' means any person who imports cattle, beef, or
beef products from outside the United States.
Sec. 1260.118 Cattle.
``Cattle'' means live domesticated bovine animals
regardless of age.
Sec. 1260.119 Beef.
``Beef'' means flesh of cattle.
Sec. 1260.120 Beef products.
``Beef products'' means edible products produced in whole
or in part from beef, exclusive of milk and products made
therefrom.
Sec. 1260.121 Imported beef or beef products.
``Imported beef or beef products'' means products which
are imported into the United States which the Secretary
determines contain a substantial amount of beef including
those products whichhave been assigned one or more of the
following numbers in the Tariff Schedule of the United States:
106.1020, 106.1040, 106.1060, 106.1080, 107.2000, 107.2520,
107.4000, 107.4500, 107.4820, 107.4840, 107.5220, 107.5240,
107.5500, 107.6100, 107.6200, 107.6300.Sec.
1260.122 Promotion.
``Promotion'' means any action, including paid advertising,
to advance[[Page 182]] the image and desirability of beef and
beef productswith the express intent of improving the
competitive position and stimulating sales of beef and beef
products in the marketplace.
Sec. 1260.123 Research.
``Research'' means studies relative to the effectiveness of
market development and promotion efforts, studies relating to the
nutritional value of beef and beef products, other related food
science research, and new product development.Sec.
1260.124 Consumer information.
``Consumer information'' means nutritional data and other
information that will assist consumers and other persons in
making evaluations and decisions regarding the purchasing,
preparing, anduse of beef and beef products.
Sec. 1260.125 Industry information
``Industry information'' means information and programs that
will lead to the development of new markets, marketing strategies,
increased efficiency, and activities to enhance the image of the
cattle industry.
Sec. 1260.126 Plans and projects.
``Plans and projects'' means promotion, research, consumer
information and industry information plans, studies or projects
conducted pursuant to this subpart.Sec.
1260.127 Marketing.
``Marketing'' means the sale or other disposition in commerce
of cattle, beef or beef products.
Sec. 1260.128 Act.
``Act'' means the Beef Promotion and Research Act of 1985,
Title XVI, Subtitle A of the Food Security Act of 1985,
Pub. L. 99-198 and any amendments thereto.Sec.
1260.129 Customs Service.
``Customs Service'' means the United States Customs Service
of the United States Department of the Treasury.
Sec. 1260.130 Part and subpart.
``Part'' means the Beef Promotion and Research Order and
all rules and regulations issued pursuant to the Act and the
order, and the order itself shall be a ``subpart'' of such
Part.Cattlemen's Beef Promotion and Research Board
Sec. 1260.141 Membership of Board.
(a) For Board nominations and appointments beginning with
those in 1996, the United States shall be divided into 39
geographical units and 1 unit representing importers, and the
number of Board members from each unit shall be as follows:
Cattle and Calves \1
----------------------------------------------------------------
(1,000
State/unit head) Directors
-----------------------------------------------------------------
1. Alabama.............................. 1,677 2
2. Arizona.............................. 863 1
3. Arkansas............................. 1,837 2
4. California........................... 4,617 5
5. Colorado............................. 2,967 3
6. Florida.............................. 1,977 2
7. Georgia.............................. 1,477 1
8. Idaho................................ 1,720 2
9. Illinois............................. 1,813 2
10. Indiana............................. 1,163 1
11. Iowa................................ 4,183 4
12. Kansas.............................. 6,067 6
13. Kentucky............................ 2,617 3
14. Louisiana........................... 943 1
15. Michigan............................ 1,210 1
16. Minnesota........................... 2,750 3
17. Mississippi......................... 1,353 1
18. Missouri............................ 4,600 5
19. Montana............................. 2,583 3
20. Nebraska............................ 6,017 6
21. New Mexico.......................... 1,437 1
22. New York............................ 1,503 2
23. North Carolina...................... 1,063 1
24. North Dakota........................ 1,857 2
25. Ohio................................ 1,480 1
26. Oklahoma............................ 5,333 5
27. Pennsylvania........................ 1,783 2
28. South Carolina...................... 513 1
29. South Dakota........................ 3,833 4
30. Tennessee........................... 2,450 2
31. Texas............................... \1\ 4,667 15
32. Utah................................ 867 1
33. Virginia............................ 1,713 2
34. Wisconsin........................... 3,883 4
35. Wyoming............................. 1,383 1
36. Northwest........................... ......... 2
Alaska................................ 9
Hawaii................................ 173
Washington............................ 1,353
------------------
Total............................. 1,535
==================
37. Northeast........................... 1
Connecticut........................... 76
Delaware.............................. 30
Maine................................. 116
Massachusetts......................... 69
[[Page 183]]
New Jersey............................ 67
Rhode Island.......................... 7
Vermont............................... 292
------------------
Total............................. 706
==================
38. Mid-Atlantic........................ 1
District of Columbia................... 0
Maryland............................... 310
West Virginia.......................... 477
------------------
Total.............................. 787
==================
39. Western............................. 2
Nevada................................. 497
Oregon................................. 1,420
------------------
Total............................... 1,917
==================
40. Importer \2\.......................... 7,016 7
---------------------------------------------------------------
\1\ 1993, 1994, and 1995 average.
\2\ 1992, 1993, and 1994 average.
(b) The Board shall be composed of cattle producers and
importers appointed by the Secretary from nominations submitted
pursuant to the Act and regulations of this Part. A producer
may only be nominated to represent the unit in which that
producer isa resident.
(c) At least every three (3) years, and not more than every
two(2) years, the Board shall review the geographic distribution
of cattle inventories throughout the United States and the volume
of imported cattle, beef, and beef products and, if warranted,
shall reapportion units and/or modify the number of Board members
from units in order to best reflect the geographic distribution
of cattle production volume in the United States and the volume
of imported cattle, beef, or beef products into the United
States.
(d) The Board may recommend to the Secretary a modification
in the number of cattle per unit necessary for representation
on the Board.
(e) The following formula will be used to determine the
number of Board members who shall serve on the Board for each
unit:
(1) Each geographic unit or State that includes a total
cattle inventory equal to or greater than five hundred thousand
(500,000) head of cattle shall be entitled to one representative
on the Board;
(2) States which do not have total cattle inventories equal
to or greater than five hundred thousand (500,000) head of
cattle shall be grouped, to the extent practicable, into
geographically contiguous units each of which have a combined
total inventory of not less than500,000 head of cattle and such
unit(s) shall be entitled to at leastone representative on the
Board;
(3) Importers shall be represented by a single unit, with
the number of Board members representing such unit based upon
a conversion of the total volume of imported cattle, beef or
beef products into live animal equivalencies;
(4) Each unit shall be entitled to representation by an
additional Board member for each one million (1,000,000) head
of cattle within the unit which exceeds the initial five
hundred thousand (500,000) head of cattle within the unit
qualifying such unit for representation.
(f) In determining the volume of cattle within the units,
the Board and the Secretary shall utilize the information
received by the Board pursuant to Secs. 1260.201 and 1260.202
industry data and data published by the Department.
[51 FR 26138, July 18, 1986, as amended at 55 FR 20445,
May 17, 1990; 58 FR 12999, Mar. 9, 1993; 60 FR 62020,
Dec. 4, 1995]
Sec. 1260.142 Term of office.
(a) The members of the Board shall serve for terms of three
(3) years, except that the members appointed to the initial
Board shall serve, proportionately, for terms of 1, 2, and 3
years. To the extent practicable, the terms of Board members
from the same unit shall be staggered for the initial Board.
(b) Each member shall continue to serve until a successor
is appointed by the Secretary.
(c) No member shall serve more than two consecutive
3-year terms in such capacity.
Sec. 1260.143 Nominations.
All nominations authorized under this section shall be
madein the following manner:
(a) Nominations shall be obtained by the Secretary from
eligible organizations. An eligible organization shall only
submit nominations for positions on the Board representing
units in[[Page 184]]which such eligible organization can
establish that it is certified as an eligible organization
to submit nominations for that unit. If the Secretary
determines that a unit is not represented by an eligible
organization, then the Secretary may solicit nominations
from organizations, and producers residing in that unit.
(b) Nominations for representation of the importer unit
may be submitted by--(1) Organizations which represent
importers of cattle, beef or beef products, as determined
by the Secretary, or (2) Individual importers of cattle,
beef or beef products. Individual importers submitting
nominations for representation of the importer unit must
establish to the satisfaction of the Secretary that the
persons submitting the nominations are importers of cattle,
beef or beef products.
(c) After the establishment of the initial Board, the
Department shall announce when a vacancy does or will exist.
Nominations for subsequent Board members shall be submitted to
the Secretary not less than sixty (60) days prior to the
expiration of the terms of the members whose terms are expiring,
in the manner as described in this section. In the case of
vacancies due to reasons other than the expiration of a term
of office, successor Board members shall be appointed pursuant
to Sec. 1260.146.
(d) Where there is more than one eligible organization
representing producers in a unit, they may caucus and jointly
nominate two qualified persons for each position representing
that unit on the Board for which a member is to be appointed.
If joint agreement is not reached with respect to any such
nominations, or if no caucus is held, each eligible
organization may submit to the Secretary two nominees for each
appointment to be made to represent that unit.
Sec. 1260.144 Nominee's agreement to serve.
Any producer or importer nominated to serve on the Board
shall file with the Secretary at the time of the nomination a
written agreement to:
(a) Serve on the Board if appointed; and
(b) Disclose any relationship with any beef promotion
entity or with any organization that has or is being considered
for a contractual relationship with the Board.
Sec. 1260.145 Appointment.
(a) From the nominations made pursuant to Sec. 1260.143,
the Secretary shall appoint the members of the Board on
the basis of representation provided for in Sec. 1260.141.
(b) Producers or importers serving on the Federation
Board of Directors shall not be eligible for appointment to
serve on the Board for a concurrent term.
Sec. 1260.146 Vacancies.
To fill any vacancy occasioned by the death, removal,
resignation, or disqualification of any member of the Board,
the Secretary shall request that nominations for a successor
for the vacancy be submitted by the eligible organization(s)
representing producers or importers of the unit represented
by the vacancy. If no eligible organization(s) represents
producers or importers in such unit, then the Secretary shall
determine the manner in which nominations for the vacancy are
submitted.
Sec. 1260.147 Procedure.
(a) At a properly convened meeting of the Board, a
majority of the members shall constitute a quorum, and any
action of the Board at such a meeting shall require the
concurring votes of at least a majority of those present
at such meeting. The Board shall establish rules concerning
timely notice of meetings.
(b) When in the opinion of the chairperson of the Board
emergency action is considered necessary, and in lieu of a
properly convened meeting, the Board may take action upon the
concurring votes of a majority of its members by mail,
telephone, or telegraph, but any such action by telephone
shall be confirmed promptly in writing. In the event that
such action is taken, all members must be notified and
provided the opportunity to vote. Any action so taken shall
have the same force as though such action had been taken
at a[[Page 185]]regular or special meeting of the Board.
Sec. 1260.148 Compensation and reimbursement.
The members of the Board shall serve without compensation,
but shall be reimbursed for necessary and reasonable expenses
incurred by them in the performance of their duties under this
subpart.
Sec. 1260.149 Powers of the Board.
The Board shall have the following powers:
(a) To administer the provisions of this subpart in
accordance with its terms and provisions;
(b) To make rules and regulations to effectuate the terms
and provisions of this subpart;
(c) To receive or initiate, investigate, and report to
the Secretary complaints of violations of the provisions of
this subpart;
(d) To adopt such rules for the conduct of its business
as it may deem advisable;
(e) To recommend to the Secretary amendments to this
subpart;and
(f) With the approval of the Secretary, to invest,
pending disbursement pursuant to a plan or project, funds
collected through assessments authorized under Sec. 1260.172,
in, and only in, obligations of the United States or any
agency thereof, in general obligations of any State or any
political subdivision thereof, in any interest-bearing
account or certificate of deposit of a bank that is a
member of the Federal Reserve System, or in obligations
fully guaranteed as to principal and interest by the
United States.
Sec.1260.150 Duties of the Board.
The Board shall have the following duties:
(a) To meet not less than annually, and to organize and
select from among its members a chairperson, a vice-chairperson
and a treasurer and such other officers as may be necessary;
(b) To elect from its members an Executive Committee of no
more than 11 and no less than 9 members, whose membership shall,
to the extent practicable, reflect the geographic distribution
of cattle numbers or their equivalent. The vice-chairperson of
the Board shall serve as chairperson of the Executive Committee
and the chairperson and the treasurer of the Board shall serve
as members of the Executive Committee;
(c) To delegate to the Executive Committee the authority to
administer the terms and provisions of this subpart under the
direction of the Board and within the policies determined by
the Board;
(d) To elect from its members 10 representatives to the
Beef Promotion Operating Committee which shall be composed of
10 members from the Board and 10 members elected by the
Federation;
(e) To utilize the resources, personnel, and facilities of
established national nonprofit industry-governed organizations;
(f) To review and, if approved, submit to the Secretary for
approval, budgets prepared by the Beef Promotion Operating
Committee on a fiscal period basis of the Committee's
anticipatedexpenses and disbursements in the administration of
the Committee's responsibilities, including probable costs of
promotion, research, and consumer information and industry
information plans or projects, and also including a general
description of the proposed promotion, research, consumer
information and industry information programs contemplated
therein;
(g) To prepare and submit to the Secretary for approval
budgets ona fiscal period basis of the Board's overall
anticipated expenses and disbursements, including the
Committee's anticipated expenses and disbursements, in the
administration of this subpart;
(h) To maintain such books and records, which shall be
available to the Secretary for inspection and audit, and to
prepare and submit such reports from time to time to the
Secretary, as the Secretary may prescribe, and to make
appropriate accounting with respect to the receipt and
disbursement of all funds entrusted to it; (i)-(j) [Reserved]
(k) To prepare and make public, at least annually, a
report of its activities carried out and an accounting for
funds received and expended;[[Page 186]] (l) To cause its
books to be audited by a certified public accountant at
least once each fiscal period and at such other times as
the Secretary may request, and submit a copy of each such
audit to the Secretary;
(m) To give the Secretary the same notice of meetings
of the Board as is given to members in order that the
Secretary, or his representative may attend such meetings;
(n) To review applications submitted by State beef
promotion organizations pursuant to Sec. 1260.181 and to
make determinations with regard to such applications;
(o) To submit to the Secretary such information pursuant
to this subpart as may be requested; and
(p) To encourage the coordination of programs of
promotion, research, consumer information and industry
information designed to strengthen the beef industry's
position in the marketplace and to maintain and expand
domestic and foreign markets and uses for beef and beef
products.[51 FR 26138, July 18, 1986, as amended at
60 FR 58502, Nov. 28, 1995]
Sec. 1260.151 Expenses.
(a) The Board is authorized to incur such expenses
(including provision for a reasonable reserve), as the
Secretary finds are reasonable and likely to be incurred
by the board for its maintenance and functioning and to
enable it to exercise its powers and perform its duties
in accordance with this subpart. Administrative expenses
incurred by the board shall not exceed 5 percent of the
projected revenue of that fiscal period. Expenses
authorized in this paragraph shall be paid from assessments
collected pursuant to Sec. 1260.172.
(b) The Board shall reimburse the Secretary, from
assessments collected pursuant to Sec. 1260.172, for
administrative costs incurred by the Department to carry
out its responsibilities pursuant to this subpart after
the effective date of this subpart. (c) [Reserved]
(d) Expenditures for the maintenance and expansion of
foreign markets for beef and beef products shall be limited
to an amount equal to or less than the total amount of
assessments paid pursuant to Sec. 1260.172(a).
[51 FR 26138, July 18, 1986, as amended at 53 FR 52631,
Dec. 29, 1988 and 54 FR 15918, Apr. 20, 1989; 60 FR 58502,
Nov. 28, 1995]
Beef Promotion Operating Committee
Sec. 1260.161 Establishment and membership.
(a) There is hereby established a Beef Promotion Operating
Committee of 20 members. The Committee shall be composed of 10
Boardmembers elected by the Board and 10 producers elected by
the Federation.
(b) Board representation on the Committee shall consist of
the chairperson, vice-chairperson and treasurer of the Board,
and seven representatives of the Board who will be duly elected
by the Board to serve on the Committee. The seven
representatives to the Committee elected by the Board shall,
to the extent practical, reflect the geographic and unit
distribution of cattle numbers, or the equivalent thereof.
(c) Federation representation on the Committee shall
consist of the Federation chairperson, vice-chairperson,
and eight duly elected producer representatives of the
Federation Board of Directors who are members or ex officio
members of the Board of Directors of a qualified State
beef council. The eight representatives of the Federation
elected to serve on the Committee shall, to the extent
practical, reflect the geographic distribution of cattle
numbers. The Federation shall submit to the Secretary the
names of the representatives elected by the Federation to
serve on the Committee and the manner in which such
election was held and that such representatives are producers
and are members or ex officio members of the Board of
Directors of a qualified State beef council on the
Federation Board of Directors. The prospective Federation
representatives shall file with the Secretary a written
agreement to serve on the Committee and to disclose any
relationship with any beef promotion entity or with any
organization that has or is being considered for a
contractual relationship with the Board or the Committee.
When the Secretary is satisfied that[[Page 187]]the above
conditions are met, the Secretary shall certify such
representatives as eligible to serve on the Committee.
Sec. 1260.162 Term of office.
(a) The members of the Committee shall serve for a
term of 1 year.
(b) No member shall serve more than six consecutive
terms.
Sec. 1260.163 Vacancies.
To fill any vacancy occasioned by the death, removal,
resignation, or disqualification of any member of the
Committee, the Board or the Federation, depending upon
which organization is represented by the vacancy, shall
submit the name of a successor for the position in the
manner utilized to elect representatives pursuant to
Sec. 1260.161 (b) and (c) of this section.
Sec. 1260.164 Procedure.
(a) Attendance of at least 15 members of the Committee
shall constitute a quorum at a properly convened meeting of
the Committee. Any action of the Committee shall require the
concurring votes of at least two-thirds of the members present.
The Committee shall establish rules concerning timely notice
of meetings.
(b) When in the opinion of the chairperson of the Committee
emergency action must be taken before a meeting can be called,
the Committee may take action upon the concurring votes of no
less than two-thirds of its members by mail, telephone, or
telegraph. Action taken by this emergency procedure is valid
only if all members are notified and provided the opportunity
to vote and any telephone vote is confirmed promptly in writing.
Any action so taken shall have the same force and effect as
though such action had been taken at a properly convened
meeting of the Committee.
Sec. 1260.165 Compensation and reimbursement.
The members of the Committee shall serve without
compensationbut shall be reimbursed for necessary and
reasonable expenses incurred by them in the performance of
their duties under this subpart.
Sec. 1260.166 Officers of the Committee.
The following persons shall serve as officers of the
Committee:
(a) The chairperson of the Board shall be chairperson
of the Committee.
(b) The chairperson of the Federation shall be
vice-chairperson of the Committee.
(c) The treasurer of the Board shall be treasurer of
the Committee.
(d) The Committee shall elect or appoint such other
officers as it may deem necessary.
Sec. 1260.167 Powers of the Committee.
The Committee shall have the following powers:
(a) To receive and evaluate, or on its own initiative,
develop and budget for plans or projects to promote the
use of beef and beef products as well as projects for
research, consumer information and industry information
and to make recommendations to the Secretary regarding
such proposals;
(b) To select committees and subcommittees of Committee
members, and to adopt such rules for the conduct of its
businessas it may deem advisable;
(c) To establish committees of persons other than
Committee members to advise the Committee and pay the
necessary and reasonable expenses and fees of the members
of such committees.
Sec. 1260.168 Duties of the Committee.
The Committee shall have the following duties:
(a) To meet and to organize;
(b) To contract with established national nonprofit
industry-governed organizations to implement programs of
promotion, research, consumer information and industry
information;
(c) To disseminate information to Board members;
(d) To prepare and submit to the Board for approval budgets
on a fiscal-period basis of its anticipated expenses and
disbursements in the administration of its responsibilities,
including probable costs of promotion, research, consumer
information and industry information plans or projects, and
also including a general description of the proposed promotion,
research,[[Page 188]]consumer information and industry
information programs contemplated therein;
(e) To develop and submit to the Secretary for approval
promotion, research, consumer information and industry
information plans or projects;
(f) With the approval of the Secretary to enter into
contracts or agreements with established national nonprofit
industry-governed organizations for the implementation and
conduct of activities authorized under Secs. 1260.167 and
1260.169 and for the payment of the cost of such activities
with funds collected through assessments pursuant to
Sec. 1260.172. Any such contract or agreement shall
provide that:
(1) The contractors shall develop and submit to the
Committee a budget or budgets which shall show the
estimated cost to be incurred for such activity or project;
(2) Any such plan or project shall become effective upon
approval of the Secretary; and
(3) The contracting party shall keep accurate records of
all of its transactions and make periodic reports to the
Committee or Board of activities conducted and an accounting
for funds received and expended, and such other reports as
the Secretary, the Committee or the Board may require.
The Secretary or agents of the Committee or the Board may
audit periodically the records of the contracting party;
(g) To prepare and make public, at least annually, a
report of its activities carried out and an accounting for
funds received and expended;
(h) To give the Secretary the same notice of meetings
of the Committee and its subcommittees and advisory committees
in order that the Secretary, or his representative, may
attend such meetings;
(i) To submit to the Board and to the Secretary such
information pursuant to this subpart as may be requested;
and
(j) To encourage the coordination of programs of
promotion, research, consumer information and industry
information designed to strengthen the cattle industry's
position in the marketplace and to maintain and expand
domestic and foreign markets and uses for beef and beef
products.
Sec. 1260.169 Promotion, research, consumer information and
industry information.
The Committee shall receive and evaluate, or on its own
initiative, develop and submit to the Secretary for approval
any plans and projects for promotion, research, consumer
information and industry information authorized by this
subpart. Such plans and projects shall provide for:
(a) The establishment, issuance, effectuation, and
administration of appropriate plans or projects for
promotion, research, consumer information and industry
information, with respect to beef and beef products
designed to strengthen the beef industry's position in
the marketplace and to maintain and expand domestic
and foreign markets and uses for beef and beef products;
(b) The establishment and conduct of research and
studieswith respect to the sale, distribution, marketing,
and utilization of beef and beef products and the creation
of newproducts thereof, to the end that marketing and
utilization ofbeef and beef products may be encouraged,
expanded, improved or made more acceptable in the United
States and foreign markets;
(c) Each plan or project authorized under paragraph
(a) and (b) of this section shall be periodically reviewed
or evaluated by the Committee to ensure that each such plan
or project contributes to an effective program of promotion,
research, consumer information and industry information. If
it is found by the Committee that any such plan or project
does not further the purposes of the Act, then the Committee
shall minate such plan or project;
(d) In carrying out any plan or project of promotion or
advertising implemented by the Committee, no reference to a
brand or trade name of any beef product shall be made without
the approval of the Board and the Secretary. No such plans or
projects shall make use of any unfair or deceptive acts or
practices, including unfair or deceptive acts or practices
with respect to the quality, value or use of any competing
product; and
(e) No funds collected by the Board under this subpart
shall in any manner[[Page 189]]be used for the purpose of
influencing governmental policy or action, except to
recommend to the Secretary amendments to this part.
Sec. 1260.172 Assessments.
(a) Domestic assessments. (1) Except as prescribed by
regulations approved by the Secretary, each person making
payment to a producer for cattle purchased from such
producer shall be a collecting person and shall collect an
assessment from the producer, and each producer shall pay
such assessment to the collecting person, at the rate of
one dollar ($1) per head of cattle purchased and such
collecting person shall remit the assessment to the Board
or to a qualified State beef council pursuant to
Sec. 1260.172(a)(5).
(2) Any producer marketing cattle of that producer's
own production in the form of beef or beef products to
consumers, either directly or through retail or wholesale
outlets, or for export purposes, shall remit to a qualified
State beef council or to the Board an assessment on such
cattle at the rate of one dollar ($1) per head of cattle
or the equivalent thereof.
(3) In determining the assessment due from each producer
pursuant to Sec. 1260.172(a), a producer who is contributing
to a qualified State beef council(s) shall receive a credit
from the Board for contributions to such Council, but not to
exceed 50 cents per head of cattle assessed.
(4) In order for a producer described in Sec. 1260.172(a)
to receive the credit authorized in Sec. 1260.172(a)(3),
the qualified State beef council or the collecting person
must establish to the satisfaction of the Board that the
producer has contributed to a qualified State beef
council.
(5) Each person responsible for the remittance of the
assessment pursuant to Sec. 1260.172 (a) (1) and (2) shall
remit the assessment to the qualified State beef council in
the State from which the cattle originated prior to sale,
or if there is no qualified State beef council ithin such
State, the assessment shall be remitted directly to the
Board. However, the Board, with the approval of the
Secretary, may authorize qualified State beef councils
to propose modifications to the foregoing ``State of origin''
rule to ensure effective coordination of assessment
collections between qualified State beef councils. Qualified
State beef councils and the Board shall coordinate assessment
collection procedures to ensure that producers selling or
marketing cattle in interstate commerce are required to pay
only one assessment per individual sale of cattle. For the
purpose of this subpart, ``State of origin'' rule means the
State where the cattle were located at time of sale, or the
State in which the cattle were located prior to sale if
such cattle were transported interstate for the sole purpose
of sale. Assessments shall be remitted not later than the
15th day of the month following the month in which the cattle
were purchased or marketed.
(6) If a State law or regulation promulgated pursuant to
State law requires the payment and collection of a mandatory,
nonrefundable assessment of more fifty (50) cents per head on
the sale and purchase of cattle, or the equivalent thereof for
beef and beef products as described in Sec. 1260.172 (a)(1)
and (2) for use by a qualified State beef council to fund
activities similar to those described in Sec. 1260.169, and
such State law or regulation authorizes the issuance of a
credit of that amount of the assessment which exceeds fifty
(50) cents to producers who waive any right to the refund of
the assessment credited by the State due pursuant to this
subpart, then any producer subject to such State law or
regulation who pays only the amount due pursuant to such
State law or regulation and this subpart, including any
credits issued, shall thereby waive that producer's right to
receipt from the Board of a refund of such assessment for
that portion of such refund for which the producer received
credit pursuant to such State law or regulation.
(b) Importer assessments. (1) Importers of cattle, beef,
and beef products into the United States shall pay an
assessment to the Board through the U.S. Customs Service,
or in such other manner as may be established by regulations
approved by the Secretary.[[Page 190]]
(2) The assessment rates for imported cattle, beef, and
beef products are as follows:
------------------------------------------------------------
Live Cattle Assessment
------------------------------------------------------------
0102.10.00103......................... $1.00/hd
0102.10.00201......................... $1.00/hd
0102.10.00309......................... $1.00/hd
0102.10.00504......................... $1.00/hd
0102.90.20004......................... $1.00/hd
0102.90.40206......................... $1.00/hd
0102.90.40402......................... $1.00/hd
0102.90.40607......................... $1.00/hd
-----------------------------------------------------------
-----------------------------------------------------------
Assessment
Beef and Beef Products -----------------------
cents/lb cents/kg
-----------------------------------------------------------
0201.10.00103....................... .77 1.697542
0201.10.00906....................... .20 0.440920
0201.20.20009....................... .28 0.617288
0201.20.40005....................... .27 0.595242
0201.20.60000....................... .20 0.440920
0201.30.20007....................... .28 0.617288
0201.30.40003....................... .27 0.595242
0201.30.60008....................... .27 0.595242
0202.10.00102....................... .77 1.697542
0202.10.00905....................... .20 0.440920
0202.20.20008....................... .28 0.617288
0202.20.40004....................... .27 0.595242
0202.20.60009....................... .20 0.440920
0202.30.20006....................... .28 0.617288
0202.30.40002....................... .27 0.595242
0202.30.60007....................... .27 0.595242
0206.10.00000....................... .20 0.440920
0206.21.00007....................... .20 0.440920
0206.22.00006....................... .20 0.440920
0206.29.00009....................... .20 0.440920
0210.20.00002....................... .35 0.771610
1601.00.40003....................... .25 0.551150
1601.00.60204....................... .25 0.551150
1602.50.05004....................... .35 0.771610
1602.50.09000....................... .35 0.771610
1602.50.10203....................... .35 0.771610
1602.50.10409....................... .35 0.771610
1602.50.20201....................... .37 0.815702
1602.50.20407....................... .37 0.815702
1602.50.60006....................... .38 0.837748
--------------------------------------------------------------
(3) The Board may prescribe by regulation, with the
approval of the Secretary, an increase or decrease in the
level of assessments for imported beef and beef products
based upon revised determinations of live animal
equivalencies.
(4) The assessments due upon imported cattle, beef and
beef products shall be remitted to the Customs Service upon
importation of the cattle, beef or beef products into the
United States, or in such other manner as may be provided
by regulations prescribed by the Board and approved by the
Secretary.
(c) The collection of assessments pursuant to Sec.
1260.172 (a) and (b) shall begin with respect to cattle
purchased or cattle, beef, and beef products imported on
and after the effective date of this section and shall
continue until terminated by the Secretary.
(d) Money remitted pursuant to this subpart shall be
in the form of a negotiable instrument made payable as
appropriate to the qualified State beef council or the
``Cattlemen's Beef Promotion and Research Board.'' Such
remittances and the reports specified in Sec. 1260.201
shall be mailed to the location designated by the Board.
[51 FR 26138, July 18, 1986, as amended at 53 FR 52631,
Dec. 29, 1988 and 54 FR 15918, Apr. 20, 1989; 54 FR 28019,
July 5, 1989]
Sec. 1260.173-1260.174 [Reserved]
Sec. 1260.175 Late-payment charge.
Any unpaid assessments due to the Board pursuant to
Sec. 1260.172 shall be increased 2.0 percent each month
beginning with the day following the date such assessments
were due. Any remaining amount due, which shall include any
unpaid charges previously made pursuant to this section,
shall be increased at the same rate on the corresponding day
of each month thereafter until paid. For the purposes of this
section, any assessment that was determined at a date later
than prescribed by this subpart because of a person's failure
to submit a report to the Board when due shall be considered
to have been payable by the date it would have been due if the
report had been filed when due. The timeliness of a payment to
the Board shall be based on the applicable postmark date or
the date actually received by the qualified State beef council
or Board, whichever is earlier.
Sec. 1260.176 Adjustment of accounts.
Whenever the Board or the Department determines that money
is due the Board or that money is due any person from the Board,
such person shall be notified of the amount due. The person
shall then remit any amount due the Board by the next date
for remitting assessments as provided in Sec. 1260.172.
Overpayments shall be credited to the account of the person
remitting the overpayment and shall be applied against
amounts due in succeeding months except that the Board shall
[[Page 191]]make prompt payment when an overpayment cannot be
adjusted by a credit.
Sec. 1260.181 Qualified State beef councils.
(a) Any beef promotion entity that is authorized by State
statute or is organized and operating within a State, that
receives assessments or contributions from producers and
conducts beef promotion, research, consumer information
and/or industry information programs may apply for
certificationof qualification so that producers may receive
credit pursuant to Sec. 1260.172(a)(3) for contributions to
such organization. The Board shall review such applications
for certification and shall make a determination as to
certification of such applicant.
(b) In order for the State beef council to be certified
by the Board as a qualified State beef council, the council
must:
(1) Conduct activities as defined in Sec. 1260.169 that
are intended to strengthen the beef industry's position in
the marketplace;
(2) Submit to the Board a report describing the manner
in which assessments are collected and the procedure utilized
to ensure that assessments due are paid;
(3) Certify to the Board that such council will collect
assessments paid on cattle originating from the State or unit
within which the council operates and shall establish
procedures for ensuring compliance with this subpart with
regard to the payment of such assessments;
(4) Certify to the Board that such organization shall
remit to the Board assessments paid and remitted to the
council, minus authorized credits issued to producers
pursuant to Sec. 1260.172(a)(3), by the last day of the
month in which the assessment was remitted to the qualified
State beef council unless the Board determines a different
date for remittance of assessments.
(5) [Reserved]
(6) Certify to the Board that the council will furnish
the Board with an annual report by a certified public
accountant of all funds remitted to such council pursuant
to this subpart and any other reports and information the
Board or Secretary may request; and
(7) Not use council funds collected pursuant to this
subpart for the purpose of influencing governmental policy
or action, or to fund plans or projects which make use of
any unfair or deceptive acts or practices including unfair
or deceptive acts or practices with respect to the quality,
value or use of any competing product.
[51 FR 26138, July 18, 1986, as amended at 60 FR 58502,
Nov. 28, 1995]
Reports, Books and Records
Sec. 1260.201 Reports.
Each importer, person marketing cattle, beef or beef
products of that person's own production directly to consumers,
and each collecting person making payment to producers and
responsible for the collection of the assessment under
Sec. 1260.172 shall report to the Board periodically
information required by regulations prescribed by the Board
and approved by the Secretary. Such information may include
but is not limited to the following:
(a) The number of cattle purchased, initially transferred
or which, in any other manner, is subject to the collection
of assessment, and the dates of such transaction;
(b) The number of cattle imported; or the equivalent
thereof of beef or beef products;
(c) The amount of assessment remitted;
(d) The basis, if necessary, to show why the remittance
is less than the number of head of cattle multiplied by one
dollar; and,
(e) The date any assessment was paid.
Effective Date Note: The regulations implementing the
reporting and recordkeeping provisions contained in
Sec. 1260.201 will be submitted for approval to the Office of
Management and Budget and will not become effective prior to
(OMB) approval.
Sec. 1260.202 Books and records.
Each person subject to this subpart shall maintain and
make available for inspection by the Secretary the records
required by regulations prescribed by the Board and approved
by the Secretary that are necessary to carry out[[Page 192]]
the provisions of this subpart, including records necessary
to verify any required reports. Such records shall be
maintained for the period of time prescribed by the regulations
issued hereunder. [51 FR 26138, July 18, 1986; 51 FR 26686,
July 25, 1986]
Effective Date Note: The regulations implementing the
reporting and recordkeeping provisions contained in Sec.
1260.202 will be submitted for approval to the Office of
Management and Budget and will not become effective prior
to (OMB) approval.
Sec. 1260.203 Confidential treatment.
All information obtained from such books, records or
reports required under the Act and this subpart shall be
kept confidential by all persons, including employees and agents
and former employees and agents of the Board, all officers
and employees and all former officers and employees of the
Department, and by all officers and employees and
all former officers and employees of contracting organizations
having access to such information, and shall not be available
to Board members or any other producers or importers. Only
those persons having a specific need for such information
in order to effectively administer the provisions of this
subpart shall have access to this information. In addition,
only such information so furnished or acquired as the
Secretary deems relevant shall be disclosed by them, and then
only in a suit or administrative hearing brought at the
direction, or upon the request, of the Secretary, or to which
the Secretary or any officer of the United States is a party,
and involving this subpart. Nothing in this section shall be
deemed to prohibit:
(a) The issuance of general statements based upon the
reports of the number of persons subject to this subpart or
statistical data collected therefrom, which statements do
not identify the information furnished by
any person; and
(b) The publication, by direction of the Secretary,
of the name of any person who has been adjudged to have
violated this subpart, together with a statement of the
particular provisions of the subpart violated by such
person.[51 FR 26138, July 18, 1986; 51 FR 26686,
July 25, 1986]
Miscellaneous
Sec. 1260.211 Proceedings after termination.
(a) Upon the termination of this subpart the Board
shall recommend not more than 11 of its members to the
Secretary to serve as trustees for the purpose of
liquidating the affairs of the Board. Such persons, upon
designation by the Secretary, shall become trustees of all
the funds and property owned, in the possession of or
under the control of the Board, including unpaid claims
or property not delivered or any other claim existing at
the time of such termination.
(b) The said trustees shall:
(1) Continue in such capacity until discharged by the
Secretary;
(2) Carry out the obligations of the Board under any
contract or agreements entered into by it pursuant to
Secs. 1260.150 and 1260.168.
(3) From time to time account for all receipts and
disbursements and deliver all property on hand, together
with all books and records of the Board and of the trustees,
to such persons as the Secretary may direct; and
(4) Upon the request of the Secretary, execute such
assignments or other instruments necessary or appropriate
to vest in such persons full title and right to all of the
funds, property, and claims vested in the Board or the
trustees pursuant to this subpart.
(c) Any person to whom funds, property, or claims have
been transferred or delivered pursuant to this subpart
shall be subject to the same obligation imposed upon the
Board and upon the trustees.
(d) Any residual funds not required to defray the
necessary expenses of liquidation shall be turned over to
the Secretary to be used, to the extent practicable, in the
interest of continuing one or more of the promotion,
research, consumer information or industry information plans
or projects authorized pursuant to this subpart.
[51 FR 26138, July 18, 1986; 51 FR 26686, July 25, 1986]
[[Page 193]]
Sec. 1260.212 Effect of termination or amendment.
Unless otherwise expressly provided by the Secretary,
the termination of this subpart or of any regulation issued
pursuant thereto, or the issuance of any amendment to either
thereof, shall not:
(a) Affect or waive any right, duty, obligation, or
liability which shall have arisen or which may hereafter
arise in connection with any provision of this subpart or
any regulation issued thereunder;
(b) Release or extinguish any violation of this subpart
or any regulation issued thereunder; or,
(c) Affect or impair any rights or remedies of the United
States, or of the Secretary, or of any person, with respect
to any such violation.
Sec. 1260.213 Removal.
If any person appointed under this part fails or refuses
to perform his or her duties properly or engages in acts of
dishonesty or willful misconduct, the Board or Committee may
recommend to the Secretary that that person be removed from
office. If the Secretary finds that the recommendation
demonstrates adequate cause, the Secretary shall remove
the person from office. A person appointed or certified under
this part or any employee of the Board or Committee may be
removed by the Secretary if the Secretary determines that
the person's continued service would be detrimental to
the purposes of the Act.
Sec. 1260.214 Personal liability.
No member, employee or agent of the Board or the
Committee, including employees or agents of a qualified
State beef council acting on behalf of the Board, shall be
held personally responsible, either individually or jointly,
in any way whatsoever, to any person for errors in judgment,
mistakes or other acts of either commission or omission,
or such member or employee, except for acts of dishonesty or
willful misconduct.
Sec. 1260.215 Patents, copyrights, inventions
and publications.
(a) Any patents, copyrights, inventions or
publications developed through the use of funds collected
by the Board under the provisions of this subpart shall
be the property of the U.S. Government as represented
by the Board, and shall, along with any rents, royalties,
residual payments, or other income from the rental, sale,
leasing, franchising,or other uses of such patents,
copyrights, inventions, or publications,ensure to the
benefit of the Board. Upon termination of this subpart,
Sec.1260.211 shall apply to determine disposition of all
such property.(b) Should patents, copyrights, inventions
or publications be developed through the use of funds
collected by the Board under this subpart and funds
contributed by another organization or person,
ownership and related rights to such patents, copyrights,
inventions or publications shall be determined by
agreement between the Board and the party contributing
funds towards the development of such patent,copyright,
invention or publication in a manner consistent with
paragraph (a) of this section.
Sec. 1260.216 Amendments.
Amendments to this subpart may be proposed, from time
to time, by the Board, or by any organization or
association certified pursuant to the Act and this part,
or by any interested person affected by the provisions
of the Act, including the Secretary.
Sec. 1260.217 Separability.
If any provision of this subpart is declared invalid
or the applicability thereof to any person or
circumstances is held invalid,the validity of the
remainder of this subpart or the applicability thereof
of other persons or circumstances shall not be affected thereby.
Subpart B--Rules and Regulations
Source: 53 FR 5754, Feb. 26, 1988, unless otherwise noted.
Sec. 1260.301 Terms defined.
As used throughout this subpart, unless the context otherwise
requires, terms shall have the same meaning as the definition of such
terms as appears in Subpart A of this part.
Sec. 1260.310 Domestic assessments.
(a) A $1.00 per head assessment on cattle sold shall be paid by the
producer of the cattle in the manner designated in Sec. 1260.311.
(b) If more than one producer shares the proceeds received for the
cattle sold, each such producer is obligated to pay that portion of the
assessments which are equivalent to the producer's proportionate share
of the proceeds.
(c) Failure of the collecting person to collect the assessment on
each head of cattle sold as designated in Sec. 1260.311 shall not
relieve the producer of his obligation to pay the assessment to the
appropriate qualified State beef council or the Cattlemen's Board as
required in Sec. 1260.312.
Sec. 1260.311 Collecting persons for purposes of collection of
assessments.
Collecting persons for purposes of collecting and remitting the
$1.00 per head assessment shall be:
(a) Except as provided in paragraph (b) and (c) of this section,
each person making payment to a producer for cattle purchased in the
United States shall collect from the producer an assessment at the rate
of $1.00 per head of cattle purchased and shall be responsible for
remitting assessments to the qualified State beef council or the
Cattlemen's Board as provided in Sec. 1260.312. The collecting person
shall collect the assessment at the time the collecting person makes
payment or any credit to the producer's account for the cattle
purchased. The person paying the producer shall give the producer a
receipt indicating payment of the assessment.
(b) Any producer marketing cattle of that producer's own production
in the form of beef or beef products to consumers, either directly or
through retail or wholesale outlets, shall be responsible for remitting
to the qualified State beef council or the Cattlemen's Board pursuant to
Sec. 1260.312, an assessment on such cattle at the rate of $1.00 per
head of cattle or the equivalent thereof. The obligation to remit the
assessment shall attach upon slaughter of the cattle, and the producer
responsible for remitting the assessment shall remit the assessment in
the manner provided in Sec. 1260.312. For the purposes of this subpart,
a producer marketing cattle of the producer's own production in the form
of beef or beef products shall be considered a collecting person.
(c) In the States listed below there exists a requirement that
cattle be brand inspected by State authorized inspectors prior to sale.
In addition, when cattle are sold in the sales transactions listed below
in those States, these State authorized inspectors are authorized to,
and shall, collect assessments due as a result of the sale of cattle. In
those transactions in which inspectors are responsible for collecting
assessments, the person paying the producer shall not be responsible for
the collection and remittance of such assessments. The following chart
identifies the party responsible for collecting and remitting
assessments in these States:
|
State |
Sales through an auction market |
Sales to slaughter/ packet |
Sales to a feedlot |
Sales to a order buyer/dealer |
Country |
|
Arizona |
CP |
CP |
CP |
B |
B |
Key:
B--Brand inspector has responsibility to collect and remit assessments due.
CP--The person paying the producer shall be the collecting person and has responsibility to collect and remit the assessments due.
B-CP--Brand inspector has responsibility to collect; however, when there
has not been a physical brand inspection the person paying the producer
shall be the collecting person and has the responsibility to collect
and remit assessments due.
1For the purpose of this subpart, the term ``country sales'' shall include any
sales not conducted at an auction or livestock market and which is not a sale
to a slaughter/packer, feedlot or an order buyer or dealer.
----------------------------------------------------------------------------
(d) For cattle delivered on futures contracts, the commission firm
or the market agency representing the seller in the delivery of cattle
shall be the collecting person.
(e) In a case where a producer sells cattle as part of a custom
slaughter operation, the producer shall be the collecting person in the
same manner as if the cattle were slaughtered for sale.
Sec. 1260.312 Remittance to the Cattlemen's Board or Qualified
State Beef Council.
Each person responsible for the collection and remittance of
assessments shall transmit assessments and a report of assessments to
the qualified State beef council of the State in which such person
resides or if there is no qualified State beef council in such State,
then to the Cattlemen's Board as follows:
(a) Reports. Each collecting person shall make reports on forms made
available or approved by the Cattlemen's Board. Each collecting person
shall prepare a separate report for each reporting period. Each report
shall be mailed to the qualified State beef council of the State in
which the collecting person resides, or its designee, or if there exists
no qualified State beef council in such State, to the Cattlemen's Board.
Each report shall contain the following information:
(1) The number of cattle purchased, initially transferred or which,
in any other manner, is subject to the collection of assessment, and the
dates of such transactions;
(2) The amount of assessment remitted;
(3) The basis, if necessary, to show why the remittance is less than
the number of head of cattle multiplied by one dollar; and
(4) The date any assessment was paid.
(b) Reporting periods. Each calendar month shall be a reporting
period and the period shall end at the close of business on the last
business day of the month.
(c) Remittances. The remitting person shall remit all assessments to
the qualified State beef council or its designee, or, if there is no
qualified State beef council, to the Cattlemen's Board at P.O. Box 27-
275; Kansas City, Missouri 64180-0001, with the report required in
paragraph (a) of this section not later than the 15th day of the
following month. All remittances sent to a qualified State beef council
or the Cattlemen's Board by the remitting persons shall be by check or
money order payable to the order of the qualified State beef council or
the Cattlemen's Board. All remittances shall be received subject to
collection and payment at par.
Sec. 1260.313 Document evidencing payment of assessments.
Each collecting person responsible for remitting an assessment to a
qualified State beef council or the Board, other than a producer
slaughtering cattle of the producer's own production for sale, is
required to give the producer from whom the collecting person collected
an assessment written evidence of payment of the Beef Promotion and
Research Assessments. Such written evidence serving as a receipt shall
contain the following information:
(a) Name and address of the collecting person.
(b) Name of producer who paid assessment.
(c) Number of head of cattle sold.
(d) Total assessments paid by the producer.
(e) Date.
Sec. 1260.314 Certification of non-producer status for certain
transactions.
(a) The assessment levied on each head of cattle sold shall not
apply to cattle owned by a person:
(1) If the person certifies that the person's only share in the
proceeds of a sale of cattle, beef, or beef products is a sales
commission, handling fee or other service fee; or
(2) If the person:
(i) Certifies that the person acquired ownership of cattle to
facilitate the transfer of ownership of such cattle from the seller to a
third party,
(ii) Establishes that such cattle were resold not later than 10 days
from the date on which the person acquired ownership; and
(iii) Certifies that the assessment levied upon the person from whom
the person purchased the cattle, if an assessment was due, has been
collected and has been remitted, or will be remitted in a timely
fashion.
(b) Each person seeking non-producer status pursuant to
Sec. 1260.116 of this part shall provide the collecting person with a
Statement of Certification of Non-Producer Status on a form approved by
the Board and the Secretary.
(c) A copy of the Statement of Certification of Non-Producer Status
shall be forwarded, upon request, by the collecting person to the
qualified State beef council or the Cattlemen's Board.
Sec. 1260.315 Qualified State Beef Councils.
The following State beef promotion entities have been certified by
the Board as qualified State beef councils:
Alabama Cattlemen's Association
Arizona Beef Council
Arkansas Beef Council
California Beef Council
Colorado Beef Council
Florida Beef Council, Inc.
Georgia Beef Board, Inc.
Idaho Beef Council
Illinois Beef Council
Indiana Beef Council
Iowa Beef Cattle Producers Association
Kansas Beef Council
Kentucky Beef Cattle Association
Louisiana Beef Industry Council
Maryland Beef Council
Michigan Beef Industry Commission
Minnesota Beef Council
Mississippi Cattle Industry Board
Missouri Beef Industry Council
Montana Beef Council
Nebraska Beef Industry Development Board
Nevada Beef Council
New Mexico Beef Council
New York Beef Industry Council
North Carolina Cattlemen's Association
North Dakota Beef Commission
Ohio Beef Council
Oklahoma Beef Commission
Oregon Beef Council
Pennsylvania Beef Council, Inc.
South Carolina Cattle and Beef Board
South Dakota Beef Industry Council
Tennessee Beef Industry Council
Texas Beef Industry Council
Utah Beef Council
Vermont Beef Council
Virginia Cattle Industry Board
Washington State Beef Commission
West Virginia Beef Industry
Wisconsin Beef Council
Wyoming Beef Council
Sec. 1260.316 Paperwork Reduction Act assigned number.
The information collection and recordkeeping requirements contained
in this part have been approved by the Office of Management and Budget
(OMB) under the provisions of 44 U.S.C. Chapter 35 and have been
assigned OMB control number 0851-0152.
DEPARTMENT OF AGRICULTUREAgricultural Marketing Service7 CFR Part 1260[No. LS-98-005]Amendment to the Beef Promotion and Research Rules and RegulationsAGENCY: Agricultural Marketing Service, USDA.ACTION: Final rule.-------------------------------------------------------------------SUMMARY: This final rule will amend the Beef Promotion and Research
Rules and Regulations (Rules and Regulations) issued under the BeefPromotion and Research Act of 1985 (Act), to clarify requirements for
documenting cattle sales transactions for which no assessments are due.
This amendment specifically requires the timely filing of Statement ofCertification of Non-Producer Status forms to obtain exemption from
assessment. Based upon comments received, this final rule reflects
changes made to the amendments as proposed.EFFECTIVE DATE: July 16, 2001.FOR FURTHER INFORMATION CONTACT: Ralph L. Tapp, Chief;
Marketing Programs Branch, Room 2627-S; Livestock and Seed Program;
Agricultural Marketing Service, USDA; STOP 0251; 1400 Independence
Avenue, SW.; Washington, DC 20250-0251. Telephone number 202/720-1115.
SUPPLEMENTARY INFORMATION:
Executive Orders 12866 and 12988; the Regulatory Flexibility Act;
and the Paperwork Reduction Act
This final rule has been reviewed under Executive Order 12866. The
rule has been determined to be not significant for the purposes of
Executive Order 12866 and, therefore, has not been reviewed by the
Office of Management and Budget.
This final rule has been reviewed under Executive Order 12988,
Civil Justice Reform. It is not intended to have a retroactive effect.
Section 11 of the Act (7 U.S.C. 2910) provides that nothing in the Act
may be construed to preempt or supersede any other program relating to
beef promotion organized and operated under the laws of the United
States or any State. There are no administrative proceedings that must
be exhausted prior to any judicial challenge to the provisions of this rule.
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601 et seq.), AMS has considered the economic
impact of this final rule on small entities. The purpose of RFA is to
fit regulatory actions to the scale of businesses subject to such
actions in order that small businesses will not be unduly burdened. The
Agricultural Marketing Service (AMS) has determined that this final
rule will not have a significant economic impact on a substantial
number of small business entities.
In the January 26, 2001, issue of ``Cattle,'' the Department of
Agriculture's (Department) National Agricultural Statistics Service
estimates that in 2000 there were 1.1 million cattle operations in the
United States. The majority of these operations subject to the Beef
Promotion and Research Order (Order), 7 U.S.C. 1260.101 et seq., are
considered small businesses under the criteria established by the Small
Business Administration.
This final rule imposes no new burden on the industry as it merely
clarifies the timing for filing of the Statement of Certification of
Non-Producer Status forms when no assessment is due on cattle sales
transactions. The regulations provide for certification of non-producer
status for certain transactions. This action specifies the time of
filing of the Statement of Certification of Non-Producer Status forms
in order to obtain an exemption from paying assessments.
In compliance with the Office of Management and Budget (OMB)
regulations [5 CFR Part 1320] which implements the Paperwork Reduction
Act [44 U.S.C. 3501 et seq.], the information collection requirements
contained in this final rule have been previously approved by OMB and
were assigned OMB control number 0581-0093.
Background
The Act authorizes the establishment of a national beef promotion
and research program. The Order and the Rules and Regulations govern
the administration of the program. The program is administered by the
Cattlemen's Beef Promotion and Research Board (Board) that is composed
of 110 cattle producers and importers. The program is funded by a $1-
per-head assessment on producer marketings of cattle in the United
States, cattle imported into the United States, and an equivalent
amount on imported beef and beef products. In 45 States, Qualified
State Beef Councils (QSBC) collect the assessments remitted under the
program. QSBCs retain up to half of the assessments they collect for
State-directed programs and remit the remainder to the Board. The Board
receives all producer assessments in five States with relatively small
cattle numbers that do not have QSBCs and all assessments on imported
cattle, beef, and beef products.
The domestic assessment, due each time cattle are sold by a
producer, is collected by the buyer or ``collecting person'' for
remittance to the Board or QSBC. The term ``producer'' is defined in
the Order as follows: ``Producer means any person who owns or acquires
ownership of cattle; provided, however, that a person shall not be
considered a producer within the meaning of this subpart if (a) the
person's only share in the proceeds of a sale of cattle or beef is a
sales commission, handling fee, or other service fee; or (b) the person
(1) acquired ownership of cattle to facilitate the transfer of
ownership of such cattle from the seller to a third party, (2) resold
such cattle no later than 10 days from the date on which the person
acquired ownership, and (3) certified, as required by regulations
prescribed by the Board and approved by the Secretary, that the
requirements of this provision have been satisfied.'' 7 CFR 1260.116.
When a person who is not a producer, under the above definition,
sells cattle within 10 days of the date the person purchased the
cattle, the collecting person is not required to collect the $1
assessment from that person (seller), if the seller provides the
collecting person with a Statement of Certification of Non-Producer
Status on a form approved by the Board and the Secretary. Although,
the majority of non-producers provide collecting persons with a
Statement of Certification of Non-Producer Status ``at the time of
sale,'' the Rules and Regulations do not specify when the Statement of
Certification of Non-Producer Status form is due. Board audits of
collecting persons' accounting records have revealed transactions in
which neither the $1 assessment, nor the Statement of Certification of
Non-Producer Status required in lieu of the assessment, was obtained
from the seller of the cattle by the collecting person for the transaction.
For the purpose of making it clear that the Statement of
Certification of Non-Producer Status form must be filed with the
collecting person in a timely manner, it was proposed that
Sec. 1260.314(b) of the Rules and Regulations be amended to read as
follows: ``(b) Each person seeking non-producer status pursuant to
Sec. 1260.116 of this part shall provide to the collecting person on a
form approved by the Board and the Secretary a Statement of
Certification of Non-Producer Status at the time the collecting person
makes payment to the seller of cattle, in lieu of the assessment that
would otherwise be due. If the collecting person is a brand inspector,
as provided for in Sec. 1260.311, the seller of cattle must provide to
the brand inspector a Statement of Certification of Non-Producer Status
at the time the physical brand inspection is completed in lieu of the
assessment that would otherwise be due.''
On August 28, 1998, AMS published in the Federal Register (63 FR
45971) for public comment a proposed rule providing for the above
amendment to Sec. 1260.314(b) of the Rules and Regulations.
The Department received two comments concerning the proposed rule.
A summary of the comments and the Department's responses are set forth
below.
The first commenter urged the Department to withdraw the proposed
revisions to the timely filing of Statements of Certification of Non-
Producer Status forms. The commenter asserted that the proposed rule
lacks merit because the Department and the Board have failed to
demonstrate any real need for the revisions to the filing of Statements
of Certification of Non-Producer Status.
The Department does not agree with the commenter's assertion. The
revisions to the Rules and Regulations are necessary to clarify that
documentation of non-producer status is required in conjunction with
the transactions. Board audits have revealed that some collecting
persons believe the current language permits documentation to be
developed months or years after the transactions occurred. The
revisions in this final rule are needed to clarify the Rules and
Regulations and to ensure compliance with them.
The commenter also asserted that the revisions to the timely filing
of Statements of Certification on Non-Producer Status forms could
result in confusion and enforcement problems for the marketing sector.
The Department believes that the revisions to Sec. 1260.314 in this
final rule will not result in any confusion and enforcement problems
for the marketing sector. In fact, as discussed further below, the
revisions clarify when the Statement of Certification of Non-Producer
Status is to be filed.
The commenter stated that groups representing ``collecting
persons'' were not consulted prior to development and publication of
the proposed rule.
The proposed rule was promulgated in accordance with the provisions
of the Administrative Procedure Act, and all members of the public were
given a 60-day period to submit comments.
The commenter further stated that the Board ``needs to address the
real problems and issues of the beef checkoff.'' The commenter did not
give any further explanation for what was meant by this statement.
Finally, the commenter objected to the proposed requirement that
the Statement of Certification of Non-Producer Status be filed at the
time payment is made to the seller. The commenter stated that in many
transactions the seller is not physically present when payment is made
by auction markets, dealers, order buyers, feedlots, and packers. The
commenter suggested that the final rule take into account current
marketing practices, including mailing delays that would prevent filing
of the Statement of Certification of Non-Producer Status until several
days after payment is made.
The Department believes that the commenter's suggestion has merit.
Accordingly, Sec. 1260.314 is revised in this final rule to specify
that if the seller is not physically present during a cattle sales
transaction in which the seller claims non-producer status, such seller
shall deliver to the collecting person an original Statement of
Certification of Non-Producer Status within 10 business days of the
date the collecting person makes payment to the seller of the cattle.
The second commenter supported the proposed revisions to the Rules
and Regulations, and suggested adding language to Sec. 1260.314 to
reflect procedures used in several brand inspected States that do not
require Statement of Certification of Non-Producer Status forms from
those reselling cattle within 10 days of purchase.
The Department agrees with the commenter's suggestion. Several
brand inspected States require a brand inspection certificate which
shows that the assessment has been deducted less than 10 days prior to
resale. Since brand inspection certificates provide documentation
acceptable to the Board and the Department that the assessment has been
paid less than 10 days prior to resale, it serves as proof of non-
producer status under Sec. 1260.314. Consequently, a non-producer
status form is not required in these transactions. Section 1260.314 has
been revised accordingly in this final rule.
List of Subjects in 7 CFR Part 1260
Advertising, Agricultural research, Imports, Marketing agreements,
Meat and meat products, Reporting and recordkeeping requirements.
For the reasons set forth in the preamble 7 CFR part 1260 is
amended as follows:
PART 1260--BEEF PROMOTION AND RESEARCH
1. The authority citation of part 1260 continues to read as
follows:
Authority: 7 U.S.C. 2901 et seq.
2. Section 1260.314 is amended by redesignating paragraph (c) as
paragraph (e), revising paragraph (b), and adding two new paragraphs
(c) and (d) to read as follows:
Sec. 1260.314 Certification of non-producer status for certain
transactions.
* * * * *
(b) Each person seeking non-producer status pursuant to
Sec. 1260.116 shall provide the collecting person, on a form approved
by the Board and the Secretary, with a Statement of Certification of
Non-Producer Status at the time the collecting person makes payment to
the seller of cattle, in lieu of the assessment that would otherwise be
due, except as provided for in paragraphs (c) and (d) of this section.
(c) When the seller of cattle is not physically present during a
sales transaction in which the seller claims non-producer status, such
seller shall deliver to the collecting person an original Statement of
Certification of Non-Producer Status within 10 business days of the
date the collecting person makes payment to the seller of the cattle.
(d) If the collecting person is a brand inspector, as provided for
in Sec. 1260.311, the seller of cattle claiming non-producer status
shall provide to the brand inspector at the time the physical brand
inspection is completed, in lieu of the assessment that would otherwise
be due, either: a Statement of Certification of Non-Producer Status or
a valid brand inspection certificate which shows collection of the
assessment by a brand inspector in a transaction which took place not
more than 10 days prior to the sale of the cattle.
* * * * *
Dated: May 9, 2001.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 01-12141 Filed 5-14-01; 8:45 am]
BILLING CODE 3410-02-P
DEPARTMENT OF AGRICULTUREAgricultural Marketing Service7 CFR Part 1260[No. LS-99-20]Amendment to the Beef Promotion and Research Rules andRegulationsAGENCY: Agricultural Marketing Service, USDA.ACTION: Final rule.-----------------------------------------------------------------------SUMMARY: This final rule amends the Beef Promotion and Research Rules and
Regulations (Rules and Regulations) established under the Beef Promotion and
Research Act of 1985 (Act) by providing producers the opportunity to voluntarily pay
the $1-per-head assessment to the Qualified State Beef Council (QSBC) located in
the producer's State of residence prior to sale, subject to certain conditions. In addition,
the chart which establishes the party responsible for collecting and remitting
assessments in brand inspected States to the QSBC or the Cattlemen's Beef Promotion
and Research Board (Board) is updated to reflect the changes the cattle industry
has incurred since the inception of the program.EFFECTIVE DATE: October 1, 2002.FOR FURTHER INFORMATION CONTACT: Kenneth R. Payne, Chief;
Marketing Programs Branch, Room 2638-S; Livestock and Seed Program; AgriculturalMarketing Service (AMS), USDA; STOP 0251; 1400 Independence Avenue,SW.; Washington, DC 20250-0251; telephone 202/720-1115.SUPPLEMENTARY INFORMATION: Prior document in this proceeding:
Proposed Rule--Beef Promotion and Research Program: Amendment to Beef
Promotion and Research Rules and Regulations published October 19, 2001 (66 FR53127), with a 60 day comment period. The comment period ended December 18, 2001.Executive Order 12866The Office of Management and Budget (OMB) has waived the review process
required by Executive Order 12866 for this action.Executive Order 12988This final rule has been reviewed under Executive Order 12988,Civil Justice Reform. This rule is not intended to have a retroactiveeffect. Section 11 of the Act provides that nothing in the Act may be construed
to preempt or supersede any other program relating to beef promotion organized
and operated under the laws of the United States or any State. There are no
administrative proceedings that must be exhausted prior to any judicial challenge
of the provisions of this rule.Regulatory Flexibility ActPursuant to requirements set forth in the Regulatory FlexibilityAct (RFA) (5 U.S.C. 601 et seq.), the Administrator of AMS hasconsidered the economic effect of this action on small entities and has determined
that this rule will not have a significant economic impact on a substantial number of
small business entities. The purpose of RFA is to fit regulatory actions to the scale of
businesses subject to such actions in order that small businesses will not be unduly
burdened.The Department of Agriculture's (Department) National Agricultural Statistics
Service estimates that in calendar year 2000 the number of cattle operations in
the United States totaled approximately 1.1 million, including feedlot operations.
There are also 45 QSBCs in the United States. In addition, there are 11 States
with brand inspectors. The majority of these operations are considered small
businesses under the criteria established by the Small Business Administration.This final rule imposes no significant burden on the industry as it merely gives
producers the opportunity to voluntarily pay the $1-per-head assessment on c
attle of their own production prior to sale and to remit the assessments to the
SBC located in the producers State of residence.The impact on QSBCs will be a redistribution of an estimatedmaximum of one-half million dollars of the $40 million currentlyretained annually in total by the 45 QSBCs. The Department estimatesthat up to 6 million head or 20 percent of the approximately 30 million head of
steers and heifers slaughtered annually are sold for slaughter under retained
ownership. The Department also estimates that assessments on up to one-sixth
of the cattle (1 million head) will be paid in advance to QSBCs. If the $1
assessment were paid in advance to QSBCs on these cattle, the QSBCs' 50
percent share of up to $1 million in assessments or as much as $500,000 will
be redistributed among the QSBCs.The major cattle feeding States of Texas, Nebraska, Kansas, Colorado, and
Oklahoma could reasonably be expected to account for up to 80 percent of
the $500,000 in reduced revenue to QSBCs annually. These States collect an
average of $19 million annually and retain one-half that amount or $9.5 million.
Assuming that the revenue to each of these five States available for State
directed programs was reduced by an average of $80,000, it would represent
about a 1 percent decrease in the average revenue available for State directed
programs in these States.The remaining 40 QSBCs have annual State budgets that average about $500,000.
An estimated net increase in annual income for these States, as a result of the
advance payment of assessments, could average up to $10,000 per State representing
a 2 percent increase.Producers wishing to direct payment of assessments to the QSBC in the producers'
State of residence when cattle are sent to another State for feeding under retained
ownership, would complete a form that would be provided to affected parties
including the QSBC, the feedlot, and the packer or the collecting person.Copies of the completed ``Certification of Producer Directed Payment of Cattle
Assessments'' form shall be maintained on file by the producer, the QSBC, the
feedlot operator, and the purchaser of the cattle for 3 years.We estimate the average cost of the reporting burden per respondent would
be $16 annually.We estimate the total average cost of the recordkeeping burden per recordkeeper
would be $8 annually.The Administrator of AMS has considered the economic effect of this action
on small entities and has determined that this final rule will not have a significant
economic impact on a substantial number of small entities.The proposed rule that was published in the Federal Register on October 19, 2001
(66 FR 53127), invited interested persons to submit comments to the Department
concerning potential effects. No comments were received regarding the RFA.Paperwork Reduction ActIn accordance with OMB regulations (5 CFR Part 1320) which implement the
Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the information
collection and recordkeeping requirements contained in this rule have been
approved by OMB under OMB control number 0581-0202.Title: Certification of Producer Directed Payment of Assessments.OMB Number: 0581-0202Expiration Date of Approval: March 1, 2005.Type of Request: Approval of new information collection.Abstract: The Act provides for a program of promotion, research,consumer information, and industry information funded by assessmentspaid by beef producers each time cattle are sold and by importers ofcattle and beef products upon importation.Assessments on imported cattle and beef products are collected bythe U.S. Customs Service at the rate of $1 per head or the live animalequivalent of beef and beef products. An assessment of $1 per head isdue from the producer each time a producer sells cattle in the UnitedStates. The assessment is to be collected by the purchaser or other``collecting person'' as provided in the rules and regulationspublished in the Federal Register on February 26, 1988 (53 FR 5749).The producer assessments are then remitted to QSBCs in 45 States and tothe Board in the remaining States. QSBCs retain up to one-half of the$1 assessment for use in State directed programs and forward the otherhalf to the Board. Currently, QSBCs in the traditional cattle feedingStates (e.g., Texas, Kansas, Nebraska, Oklahoma, and Colorado) collectand retain assessments on cattle sold that are owned by producersresiding in other States. This benefits QSBCs in the States that havelarge numbers of cattle in feedlots owned by producers residing inother States. Some producers retain ownership of cattle and transportthem to one of the cattle feeding States. To provide producers withmore flexibility and to provide the opportunity for a more equitabledistribution of assessment funds to States based on cattle ownership,the final ``Certification of Producer Directed Payment of CattleAssessments'' form would be made available for use by producers whowant the QSBC located in their States of residence to receive assessment
funds rather than the QSBC in the State where the cattle are fed.1. Certification of Producer Directed Payment of Assessments.Estimate of Burden: The public reporting burden for this collectionof information is estimated to average .20 hour per response.Respondents: Producers wishing to direct payment of assessments tothe QSBC in the producers' State of residence when cattle are sent toanother State for feeding under retained ownership would use the form.Estimated Number of Respondents: 1,000.Estimated Number of Responses per Respondent: 4.Estimated Total Annual Burden on Respondents: 800 hours.Total cost: $16,000.2. Maintenance of records: 3 years.Estimate of Burden: The public recordkeeping burden for keepingthis document is estimated to average .10 hour per recordkeeper.Recordkeepers: Producers, QSBCs, feedlot operators, and purchasers.Estimated Number of Recordkeepers: 1,260.Estimated Total Recordkeeping Hours: 504 hours.Estimated Total Cost: $10,080.The total average cost of the estimated annual reporting burden perrespondent would be: $16.00.The total average cost of the recordkeeping burden per recordkeeper
would be: $8.00.BackgroundThe Act authorizes the establishment of a national beef promotionand research program. The final Order establishing a beef promotion andresearch program was published in the Federal Register on July 18,1986, (51 FR 21632) and assessments began on October 1, 1986. Theprogram is administered by the Board which is composed of 110 domesticcattle producers and importers. The program is funded by a $1-per-headassessment on producer marketings of cattle in the United States and anequivalent amount on imported cattle, beef, and beef products. In 45States, QSBCs receive the $1-per-head of cattle assessment remittedunder the program and retain up to half of the $1 for State-directedprograms and remit the remainder to the Board. The Board receives allimport assessments and all producer assessments in the five States withrelatively small cattle numbers that do not have QSBCs. In 2000, the 45QSBCs received a total of about $80 million in assessments. QSBCsretained about $40 million and remitted approximately $40 million tothe Board.The domestic assessment, due each time cattle are sold by aproducer, is collected by the buyer or ``collecting person'' and remitted to the
Board or QSBC. The term ``producer'' is defined as follows: ``any person who
owns or acquires ownership of cattle; provided, however, that a person shall not
be considered a producer within the meaning of this subpart if (a) the person's
only share in the proceeds of a sale of cattle or beef is a sales commission,
handling fee, or other service fee; or (b) the person (1) acquired ownership
of cattle to facilitate the transfer of ownership of such cattle from the seller
to a third-party, (2) resold such cattle no later than 10 days from the date on
which the person acquired ownership, and (3) certified, as required by
regulations prescribed by the Board and approved by the Secretary, that
the requirements of this provision have been satisfied.''When cattle are sold within 10 days of purchase by a person who isnot a producer under the above definition, the collecting person is notrequired to collect the $1 assessment from the person (seller), if theseller provides the collecting person with a Statement of Certificationof Non-Producer Status on a form approved by the Board and theSecretary. The person claiming non-producer status must submit to thecollecting person a Statement of Certification of Non-Producer Status``at the time of sale'' in lieu of paying the assessment.In a similar fashion, this modification to the regulations to permit
producer-directed payment of assessments will result in the collecting person,
at the time of sale, collecting a document certifying that the assessment had
been paid in advance by the producer. The Department believes that this
producer-directed payment option will be used by producers of a relatively
small share of all cattle sold. This rule will apply only to cattle of a producer's
own production transported to another State under retained ownership for feeding
prior to sale as slaughter cattle. Utilizing this option would permit a producer who
retains ownership of cattle to ensure that the QSBC located in the State where
the producer resides receives the $1 checkoff rather than the QSBC in the State in
which the cattle are located when sold. This final rule could increase checkoff
revenue for many QSBCs such as those located in the southeastern United States
that currently do not receive revenue from cattle owned and sold by producers residing
in the southeastern States who use feedlots in States such as Texas, Kansas,
Nebraska, Oklahoma, and Colorado to finish cattle before selling the cattle to packers.Since States retain up to one-half of the $1-per-head checkoff foruse in State directed programs, providing producers with theflexibility and the opportunity to direct payment of the assessment totheir home State likely would increase revenue in many States such asFlorida, Georgia, Alabama, and Mississippi with limited feedlotcapacity.CommentsOn October 19, 2001, the Department published in the Federal Register (66 FR 53127)
for comment a proposed rule to amend the Rules and Regulations established under
the Act. The proposed rule provided the opportunity for a producer to pay the
$1-per-head assessment to the QSBC located in the producer's State of residence
prior to sale, subject to certain conditions.The proposed rule was published with a request for comments to besubmitted by December 18, 2001. The Department received comments from47 national and State beef and dairy cattle organizations, and brandinspectors, as well as from cattle producers. Comments from 44commenters were filed on time. Eleven commenters supported the proposed rule
while four commenters proposed modifications and requestedclarifications to it. Twenty-nine commenters opposed the proposed rule.Three comments were submitted after the comment period ended. The latecomments, however, supported the rule as proposed.The comments are discussed below, together with a description ofthe changes made by the Department in this final rule. In general, persons and
organizations in States that may see an increase in assessments supported the
proposed rule, while persons and organizations in the primary cattle feeding States
that may see a reduction in assessments did not support the proposed rule.Three commenters suggested producers, QSBCs, the Board, the feedlot operator,
and the purchaser of the cattle should maintain copies of the Certification of
Producers Direct Payment of Cattle Assessments forms on file for 3 years
rather than 2 years. The standard procedure currently in place for random
compliance audits of remitters is 3 years. The Department believes that this c
omment has merit, and this change is reflected in Sec. 1260.311(f)(4) by
removing 2 years and inserting 3 years.One commenter asserted that the QSBC which receives the additionalcheckoff funds must be responsible for compliance. Currently, QSBCs areresponsible for collecting and remitting the assessment to the Boardand ensuring that those persons subject to the assessment remit them.In States where there is no QSBC, the Board is responsible for compliance.
Accordingly, the Department is not making any changes in response to this comment.The same commenter suggested that the term Board could be omittedfrom Sec. 1260.311(f)(1), as only the QSBC located in the State where the
producer resides would apply. The commenter noted that producers in the
five States without a QSBC will be unable to use this option as their dollar already
is currently directed to the Board. The Department believes that this comment hasmerit and therefore the term Board is removed from Sec. 1260.311(f)(1)in this final rule.Five commenters stated that the regulations must specify what``cattle of a producer's own production'' are in order to ensure thisincludes only offspring from a producer's own cow herd that have been continuously
and exclusively under his or her ownership, and are being sent to feedlots with the
intent of continuously owning the cattle through the entire feeding phase. The
Department believes that this comment has merit and additional clarification
regarding the meaning of ``cattle of a producer's own production'' is
reflected in new Sec. 1260.311(f)(iii) of this final rule.Three commenters asserted that producers must list the number oftheir cow herds on the certificate as a method to cross check that thecattle transported to the feedyard qualify as retained ownershipcattle. The Department believes that this additional requirement wouldnot have any impact on compliance activities. The current compliancepractices in the industry and the proposed certification process aresufficient to ensure compliance with the provisions of the Act, theBeef Promotion and Research Order (Order), and this final rule.Two commenters suggested that the regulation should apply only totrue retained ownership cattle. Since cattle sold through auctions,dealer/order buyers, and country sales are not applicable, the commenters
believe these references should be removed from the table in Sec. 1260.311(c).
While the table in Sec. 1260.311(c) is being updated as part of this final rule, it does
not directly apply to the producer payment option of this final rule. It specifies the partyresponsible for collecting and remitting assessments in designatedStates. Accordingly, the Department is not making any changes in response to
these comments.Another commenter stated that assessments should be collected oncattle sold within the first 30 days of movement and the dollarsreturned to the State of Origin under the current rules. The Departmentbelieves that the option provided for in this rule is flexible and costeffective for producers. Under Sec. 1260.311(f)(1)(ii) of the ruleproducers can pay the assessment either before or at the time thecattle are transported. Therefore, we are not making any changes to therule in response to this comment.Three commenters stated that the regulations should address deathloss on cattle that are prepaid in the State of Origin. The commenterssuggested that the proposal should specify that the producer will notbe given a credit of their dollar for cattle that have died before theyare shipped to the ultimate purchaser of the cattle. The Departmentbelieves that this comment has merit. Because of the low mortalityrates and the costs associated with administrative matters involvinginvestigation of animal death and producer, QSBC and Boardnotification, the costs associated with producer credits would besubstantial, far in excess of the $1-per-head assessment paid by theproducer. Therefore, we are adding a new paragraph 5 to Sec.1260.311(f) of this final rule to prohibit credits of assessments forthose cattle lost because of death.Three commenters asserted that many feedlots and retained ownershipprograms involve sorting and co-mingling of cattle from various owners into
numerous different pens and lots and then sold to the packer atdifferent times. Consequently, if the assessment is prepaid, thedocumentation on those cattle could be confusing since they will not beprocessed in the same lot. The Department believes the feedlot should not be
required to complete a new form. Feedlots may note on theexisting form that the specific cattle marketed have been prepaid inorder to facilitate their own recordkeeping. Accordingly, we are not making
any changes in response to this comment.One commenter expressed concern that some cattle may be placed onfeed with the producer having the intention of retaining ownershipthrough the entire feeding cycle. However, during the feeding cycle,the producer may decide to sell a partial interest in the cattle withinthe feedyard. The purpose of this rule is to provide producers theopportunity to voluntarily pay the $1-per-head assessment to the QSBCon cattle transported to a feedyard under retained ownership. This ruledoes not provide producers with an opportunity for a credit. If aproducer transfers any interest in the cattle prior to their sale to apurchaser, the cattle are no longer covered under the provisions ofthis rule. Consequently, an additional assessment is due as a result ofthe new owner transfer, even if the transfer of ownership is onlypartial.Four commenters asserted that the QSBC receiving the checkoffshould be required to send a new verification form to the feedlot tonotify it that the checkoff has been received. The Department believesthat any additional certification of producer payment by QSBCs would be
unnecessary and burdensome. As noted previously, the Departmentbelieves that the current certification is sufficient to ensure compliance with
the provisions of this final rule. Therefore, we are not making any changes in
response to this comment.One commenter stated that the assessments should be paid at thetime of transport. Under Sec. 1260.311(f)(1)(ii) of the rule producers can pay the
assessment either before or at the time the cattle are transported.One commenter suggested that the packer should retain a copy of thecertificate, not the feedlot, because the packer, as the purchaser, is responsible for
collecting the checkoff for slaughter cattle. The commenter believes that this would
provide a simple and streamlined procedure for compliance and audit.
Section 1260.311(f)(4) requires that the certification form be sent to all parties
involved, including packers when they act as purchasers.One commenter suggested that the producer should be responsible forensuring the pa