PART 1135 -- MILK IN THE WESTERN MARKETING AREA

Subpart -- Order Regulating Handling

GENERAL PROVISIONS

Sec.

1135.1 General provisions.

DEFINITIONS

1135.2 Western marketing area.

1135.3 Route disposition.

1135.4 Plant.

1135.5 Distributing plant.

1135.6 Supply plant.

1135.7 Pool plant.

1135.8 Nonpool plant.

1135.9 Handler.

1135.10 Producer-handler.

1135.11 Proprietary bulk tank handler.

1135.12 Producer.

1135.13 Producer milk.

1135.14 Other source milk.

1135.15 Fluid milk product.

1135.16 Fluid cream product.

1135.17 [Reserved]

1135.18 Cooperative association.

1135.19 Commercial food processing establishment.

HANDLER REPORTS

1135.30 Reports of receipts and utilization.

1135.31 Payroll reports.

1135.32 Other reports.

CLASSIFICATION OF MILK

1135.40 Classes of utilization.

1135.41 [Reserved]

1135.42 Classification of transfers and diversions.

1135.43 General classification rules.

1135.44 Classification of producer milk.

1135.45 Market administrator's reports and announcements

 concerning classification.

CLASS PRICES

1135.50 Class prices, component prices, and advanced pricing

 factors.

1135.51 Class I differential and price.

1135.52 Adjusted Class I differentials.

1135.53 Announcement of class prices, component prices, and
 advanced pricing factors.

1135.54 Equivalent price.

PRODUCER PRICE DIFFERENTIAL

1135.60 Handler’s value of milk.

1135.61 Computation of producer price differential.

1135.62 Announcement of producer prices.

PAYMENTS FOR MILK

1135.70 Producer-settlement fund.

1135.71 Payments to the producer-settlement fund.

1135.72 Payments from the producer-settlement fund.

1135.73 Payments to producers and to cooperative associations.

1135.74 [Reserved]

1135.75 Plant location adjustments for producer milk and

 nonpool milk.

1135.76 Payments by a handler operating a partially regulated

 distributing plant.

1135.77 Adjustment of accounts.

1135.78 Charges on overdue accounts.

ADMINISTRATIVE ASSESSMENT AND MARKETING SERVICE DEDUCTION

1135.85 Assessment for order administration.

1135.86 Deduction for marketing services.

 Authority: 7 U.S.C. 601-674, and 7253.

Subpart -- Order Regulating Handling

GENERAL PROVISIONS

§ 1135.1 General provisions.

The terms, definitions, and provisions in part 1000 of this

chapter apply to this part 1135. In this part 1135, all references

to sections in part 1000 refer to part 1000 of this chapter.

DEFINITIONS

§ 1135.2 Western marketing area.

The marketing area means all territory within the bounds of the

following states and political subdivisions, including all piers,

docks and wharves connected therewith and all craft moored thereat,

and all territory occupied by government (municipal, State or

Federal) reservations, installations, institutions, or other similar

establishments if any part thereof is within any of the listed states

or political subdivisions: 

Idaho Counties

Ada, Adams, Bannock, Bear Lake, Bingham, Blaine, Boise,

Bonneville, Camas, Canyon, Caribou, Cassia, Elmore, Franklin, Gem,

Gooding, Jefferson, Jerome, Lincoln, Madison, Minidoka, Oneida,

Owyhee, Payette, Power, Twin Falls, Valley, and Washington.
Nevada Counties

Elko, Lincoln, and White Pine.

Oregon Counties

Baker, Grant, Harney, Malheur, and Union.

Utah

All of the State of Utah.

Wyoming Counties

Lincoln and Uinta.

§ 1135.3 Route disposition.

See § 1000.3.

§ 1135.4 Plant.

See § 1000.4.

§ 1135.5 Distributing plant.

See § 1000.5.

§ 1135.6 Supply plant.

See § 1000.6.

§ 1135.7 Pool plant.

Pool Plant means a plant or unit of plants specified in

paragraphs (a) through (e) of this section, but excluding a plant

specified in paragraph (g) of this section. The pooling standards

described in paragraphs (c) and (d) of this section are subject to

modification pursuant to paragraph (f) of this section.

(a) A distributing plant, other than a plant qualified as a

pool plant pursuant to paragraph (b) of this section or

§ ----.7(b) of any other Federal milk order, from which during the

month 25 percent or more of the total quantity of fluid milk products

physically received at the plant (excluding concentrated milk

received from another plant by agreement for other than Class I use)

are disposed of as route disposition or are transferred in the form

of packaged fluid milk products to other distributing plants. At

least 25 percent of such route disposition and transfers must be to

outlets in the marketing area. 

(b) Any distributing plant located in the marketing area which

during the month processed at least 25 percent of the total quantity

of fluid milk products physically received at the plant (excluding

concentrated milk received from another plant by agreement for other

than Class I use) into ultra-pasteurized or aseptically-processed

fluid milk products.

(c) A supply plant from which during the month the quantity of

bulk fluid milk products transferred or diverted to plants described

in paragraph (a) or (b) of this section is 35 percent or more of the

total Grade A milk received at the plant from dairy farmers (except
dairy farmers described in § 1135.12(b)) and handlers described in §

1000.9(c) and § 1135.11, including milk diverted by the plant

operator, subject to the following conditions:

(1) A supply plant that has qualified as a pool plant during

each of the immediately preceding months of September through

February shall continue to so qualify in each of the following months

of March through August unless the plant operator files a written

request with the market administrator that such plant not be a pool

plant, such nonpool status to be effective the first month following

such request. A plant withdrawn from pool supply plant status may

not be reinstated for any subsequent month of the March through July

period unless it qualifies as a pool plant on the basis of milk

shipments;

(2) A pool plant operator may include as qualifying shipments

milk diverted to pool distributing plants pursuant to § 1135.13(c);

(3) Concentrated milk transferred from the supply plant to a

distributing plant for an agreed-upon use other than Class I shall be

excluded from the supply plant’s shipments in computing the plant’s

shipping percentage; and

(4) No plant may qualify as a pool plant due to a reduction in

the shipping percentage pursuant to paragraph (f) of this section

unless it has been a pool supply plant during each of the immediately

preceding 3 months.

(d) A milk manufacturing plant located within the marketing

area that is operated by a cooperative association if, during the

month or the immediately preceding 12-month period ending with the

current month, 35% or more of such cooperative’s member producer milk

(and any producer milk of nonmembers and members of another

cooperative association which may be marketed by the cooperative

association) is physically received in the form of bulk fluid milk

products (excluding concentrated milk transferred to a distributing

plant for an agreed-upon use other than Class I) at plants specified

in paragraph (a) or (b) of this section either directly from farms or

by transfer from supply plants operated by the cooperative

association and from plants of the cooperative association for which

pool plant status has been requested under this paragraph subject to

the following conditions:

(1) The plant does not qualify as a pool plant under paragraph

(a), (b) or (c) of this section or under comparable provisions of

another Federal order; and

(2) The plant is approved by a duly constituted regulatory

agency for the handling of milk approved for fluid consumption in the

marketing area.

(e) Two or more plants located in the marketing area and

operated by the same handler may qualify for pool plant status as a

unit by together meeting the requirements specified in paragraph (a)

of this section and subject to the following additional requirements:
(1) At least one of the plants in the unit must individually

qualify as a pool plant pursuant to paragraph (a) of this section;

(2) Other plants in the unit must process Class I or Class II

products, using 50 percent or more of the total Grade A fluid milk

products received in bulk form at such plant or diverted therefrom by

the plant operator in Class I or Class II products, and must be

located in a pricing zone providing the same or a lower Class I price

than the price applicable at the distributing plant included in the

unit pursuant to paragraph (e)(1) of this section; and

(3) A written request to form a unit must be filed by the

handler with the market administrator prior to the first day of the

month for which such status is to be effective. The unit shall

continue from month to month thereafter without further notification. 

The handler shall notify the market administrator in writing prior to

the first day of any month for which termination or any change of the

unit is desired.

(f) The applicable shipping percentages of paragraphs (c) and

(d) of this section may be increased or decreased by the market

administrator if the market administrator finds that such adjustment

is necessary to encourage needed shipments or to prevent uneconomic

shipments. Before making such a finding, the market administrator

shall investigate the need for adjustment either on the market

administrator’s own initiative or at the request of interested

parties if the request is made in writing at least 15 days prior to

the month for which the requested revision is desired effective. If

the investigation shows that an adjustment of the shipping

percentages might be appropriate, the market administrator shall

issue a notice stating that an adjustment is being considered and

invite data, views and arguments. Any decision to revise an

applicable shipping percentage must be issued in writing at least one

day before the effective date.

(g) The term pool plant shall not apply to the following

plants:

(1) A producer-handler as defined under any Federal order; 

(2) An exempt plant as defined in 1000.8(e);

(3) A plant located within the marketing area and qualified

pursuant to paragraph (a) of this section which meets the pooling

requirements of another Federal order, and from which more than 50

percent of its route disposition has been in the other Federal order

marketing area for 3 consecutive months;

(4) A plant located outside any Federal order marketing area

and qualified pursuant to paragraph (a) of this section that meets

the pooling requirements of another Federal order and has had greater

route disposition in such other Federal order’s marketing area for 3

consecutive months;

(5) A plant located in another Federal order marketing area

and qualified pursuant to paragraph (a) of this section that meets
the pooling requirements of such other Federal order and does not

have a majority of its route distribution in this marketing area for

3 consecutive months or if the plant is required to be regulated

under such other Federal order without regard to its route

disposition in any other Federal order marketing area;

(6) A plant qualified pursuant to paragraph (c) of this

section which also meets the pooling requirements of another Federal

order and from which greater qualifying shipments are made to plants

regulated under the other Federal order than are made to plants

regulated under the order in this part, or the plant has automatic

pooling status under the other Federal order; and

(7) That portion of a regulated plant designated as a nonpool

plant that is physically separate and operated separately from the

pool portion of such plant. The designation of a portion of a

regulated plant as a nonpool plant must be requested in advance and

in writing by the handler and must be approved by the market

administrator.

§ 1135.8 Nonpool plant.

See § 1000.8.

§ 1135.9 Handler.

In addition to the handlers defined in § 1000.9, handler shall

include a person meeting the standards set forth in § 1135.11.

§ 1135.10 Producer-handler.

Producer-handler means a person who:

(a) Operates a dairy farm and a distributing plant from which

there is route disposition in the marketing area during the month;

(b) Receives fluid milk products from own farm production or

milk that is fully subject to the pricing and pooling provisions of

the order in this part or another Federal order;

(c) Receives at its plant or acquires for route disposition no

more than 150,000 pounds of fluid milk products from handlers fully

regulated under any Federal order. This limitation shall not apply

if the producer-handler’s own farm production is less than 150,000

pounds during the month;

(d) Disposes of no other source milk as Class I milk except by

increasing the nonfat milk solids content of the fluid milk products;

and

(e) Provides proof satisfactory to the market administrator

that the care and management of the dairy animals and other resources

necessary to produce all Class I milk handled (excluding receipts

from handlers fully regulated under any Federal order) and the

processing and packaging operations are the producer-handler’s own

enterprise and are operated at its own risk.
§ 1135.11 Proprietary bulk tank handler.

Any person, except a cooperative association, with respect to

milk that it receives for its account from the farm of a producer in

a tank truck owned and operated by, or under the control of, such

person and which is delivered during the month for the account of

such person to the pool plant of another handler or diverted pursuant

to § 1135.13, subject to the following conditions:

(a) Such person must operate a plant located in the marketing

area at which milk is processed only into Class II, Class III, or

Class IV products; and

(b) Prior to operating as a handler pursuant to this

paragraph, such person must submit to the marker administrator a

statement signed by the applicant and the operator of the pool plant

to which the milk will be delivered specifying that the applicant

will be the responsible handler for the milk.

§ 1135.12 Producer.

(a) Except as provided in paragraph (b) of this section,

producer means any person who produces milk approved by a duly

constituted regulatory agency for fluid consumption as Grade A milk

and whose milk (or components of milk) is:

(1) Received at a pool plant directly from the producer or

diverted by the plant operator in accordance with § 1135.13; or

(2) Received by a handler described in § 1000.9(c) or §

1135.11.

(b) Producer shall not include:

(1) A producer-handler as defined in any Federal order;

(2) A dairy farmer whose milk is delivered to an exempt plant,

excluding producer milk diverted to the exempt plant pursuant to

§ 1135.13(d);

(3) A dairy farmer whose milk is diverted to a pool plant by a

handler regulated under another Federal order if the other Federal

order designates the dairy farmer as a producer under that order and

that milk is allocated by request to a utilization other than Class

I;

(4) A dairy farmer whose milk is reported as diverted to a

plant fully regulated under another Federal order with respect to

that portion of the milk so diverted that is assigned to Class I

under the provisions of such other order; and

(5) A dairy farmer whose milk was received at a nonpool plant

during the month from the same farm (except a nonpool plant that has

no utilization of milk products in any Class other than Class III or

Class IV) as other than producer milk under the order in this part or

any other Federal order. Such a dairy farmer shall be known as a

dairy farmer for other markets. 

§ 1135.13 Producer milk. 
Producer milk means the skim milk (or the skim equivalent of

components of skim milk), including nonfat components, and butterfat

in milk of a producer that is: 

(a) Received by the operator of a pool plant directly from a

producer, a handler described in § 1000.9(c), or a handler described

in § 1135.11. All milk received pursuant to this paragraph shall be

priced at the location of the plant where it is first physically

received;

(b) Received by a handler described in § 1000.9(c) or in §

1135.11 in excess of the quantity delivered to pool plants;

(c) Diverted by a pool plant operator to another pool plant. 

Milk so diverted shall be priced at the location of the plant to

which diverted; or

(d) Diverted by the operator of a pool plant, a cooperative

association described in § 1000.9(c), or a proprietary bulk tank

handler described in § 1135.11, to a nonpool plant, subject to the

following conditions:

(1) Milk of a dairy farmer shall not be eligible for diversion

unless at least one day’s milk production of such dairy farmer has

been physically received as producer milk at a pool plant and the

dairy farmer has continuously retained producer status since that

time. If a dairy farmer loses producer status under the order in

this part (except as a result of a temporary loss of Grade A

approval), the dairy farmer’s milk shall not be eligible for

diversion until one day’s milk production has been physically

received as producer milk at a pool plant;

(2) Of the quantity of producer milk received during the month

(including diversions) the handler diverts to nonpool plants not more

than 90 percent;

(3) Two or more handlers described in § 1000.9(c) may have

their allowable diversions computed on the basis of their combined

deliveries of producer milk which they caused to be delivered to pool

plants or diverted during the month if each has filed a request in

writing with the market administrator before the first day of the

month the agreement is to be effective. The request shall specify

the basis for assigning overdiverted milk to the producer deliveries

of each according to a method approved by the market administrator. 

(4) Diverted milk shall be priced at the location of the plant

to which diverted;

(5) Any milk diverted in excess of the limits prescribed in

paragraph (d)(2) of this section shall not be producer milk. If the

diverting handler, cooperative association, or proprietary bulk tank

handler fails to designate the dairy farmers’ deliveries that are not

to be producer milk, no milk diverted by the handler, cooperative

association, or proprietary bulk tank handler during the month to a

nonpool plant shall be producer milk. In the event some of the milk

of any producer is determined not to be producer milk pursuant to
this paragraph, other milk delivered by such producer as producer

milk during the month will not be subject to § 1135.12(b)(5); and

(6) The delivery day requirement in paragraph (d)(1) and the

diversion percentage in paragraph (d)(2) of this section may be

increased or decreased by the market administrator if the market

administrator finds that such revision is necessary to assure orderly

marketing and efficient handling of milk in the marketing area. 

Before making such a finding, the market administrator shall

investigate the need for the revision either on the market

administrator’s own initiative or at the request of interested

persons if the request is made in writing at least 15 days prior to

the month for which the requested revision is desired effective. If

the investigation shows that a revision might be appropriate, the

market administrator shall issue a notice stating that the revision

is being considered and inviting written data, views, and arguments. 

Any decision to revise the delivery day requirement or the diversion

percentage must be issued in writing at least one day before the

effective date.

§ 1135.14 Other source milk.

See § 1000.14.

§ 1135.15 Fluid milk product.

See § 1000.15.

§ 1135.16 Fluid cream product.

See § 1000.16.

§ 1135.17 [Reserved]

§ 1135.18 Cooperative association.

See § 1000.18.

§ 1135.19 Commercial food processing establishment.

See § 1000.19.

HANDLER REPORTS

§ 1135.30 Reports of receipts and utilization.

Each handler shall report monthly so that the market

administrator receives the report on or before the 7th day after the

end of each month, in the detail and on the forms prescribed by the

market administrator, as follows:

(a) Each handler that operates a pool plant pursuant to

§ 1135.7 shall report for each of its operations the following

information: 

(1) Product pounds, pounds of butterfat, pounds of protein,

and pounds of solids-not-fat other than protein (other solids),
contained in or represented by:

(i) Receipts of producer milk, including producer milk

diverted by the reporting handler, from sources other than handlers

described in § 1000.9(c) and § 1135.11; and

(ii) Receipts of milk from handlers described in § 1000.9(c)

and § 1135.11;

(2) Product pounds and pounds of butterfat contained in:

(i) Receipts of fluid milk products and bulk fluid cream

products from other pool plants;

(ii) Receipts of other source milk; and

(iii) Inventories at the beginning and end of the month of

fluid milk products and bulk fluid cream products;

(3) The utilization or disposition of all milk and milk

products required to be reported pursuant to this paragraph; and

(4) Such other information with respect to the receipts and

utilization of skim milk, butterfat, milk protein, and other nonfat

solids, as the market administrator may prescribe.

(b) Each handler operating a partially regulated distributing

plant shall report with respect to such plant in the same manner as

prescribed for reports required by paragraph (a) of this section. 

Receipts of milk that would have been producer milk if the plant had

been fully regulated shall be reported in lieu of producer milk. The

report shall show also the quantity of any reconstituted skim milk in

route disposition in the marketing area.

(c) Each handler described in §§ 1000.9(c) or 1135.11 shall

report:

(1) The product pounds, pounds of butterfat, pounds of

protein, and the pounds of solids-not-fat other than protein (other

solids) contained in receipts of milk from producers; and

(2) The utilization or disposition of such receipts.

(d) Each handler not specified in paragraphs (a) through (c)

of this section shall report with respect to its receipts and

utilization of milk and milk products in such manner as the market

administrator may prescribe.

§ 1135.31 Payroll reports.

(a) On or before the 21st day after the end of each month, each

handler that operates a pool plant pursuant to § 1135.7 and each

handler described in § 1000.9(c) and in § 1135.11 shall report to the

market administrator its producer payroll for the month, in the

detail prescribed by the market administrator, showing for each

producer the information described in § 1135.73(e).

(b) Each handler operating a partially regulated distributing

plant who elects to make payment pursuant to § 1000.76(b) shall

report for each dairy farmer who would have been a producer if the

plant had been fully regulated in the same manner as prescribed for

reports required by paragraph (a) of this section.
§ 1135.32 Other reports.

In addition to the reports required pursuant to §§ 1135.30 and

1135.31, each handler shall report any information the market

administrator deems necessary to verify or establish each handler’s

obligation under the order.

CLASSIFICATION OF MILK

§ 1135.40 Classes of utilization.

See § 1000.40.

§ 1135.41 [Reserved]

§ 1135.42 Classification of transfers and diversions. 

See § 1000.42.

§ 1135.43 General classification rules.

See § 1000.43.

§ 1135.44 Classification of producer milk.

See § 1000.44.

§ 1135.45 Market administrator's reports and announcements

concerning classification.

See § 1000.45.

CLASS PRICES

§ 1135.50 Class prices, component prices, and advanced pricing

factors.

See § 1000.50.

§ 1135.51 Class I differential and price.

The Class I differential shall be the differential established

at Salt Lake County, Utah, which is reported in § 1000.52. The Class

I price shall be the price computed pursuant to § 1000.50(a) for Salt

Lake County, Utah.

§ 1135.52 Adjusted Class I differentials.

See § 1000.52.

§ 1135.53 Announcement of class prices, component prices, and

advanced pricing factors. 

See § 1000.53.

§ 1135.54 Equivalent price.

See § 1000.54.
PRODUCER PRICE DIFFERENTIAL

§ 1135.60 Handler’s value of milk.

For the purpose of computing a handler’s obligation for

producer milk, the market administrator shall determine for each

month the value of milk of each handler with respect to each of the

handler's pool plants, and of each handler described in § 1000.9(c)

and each handler described in § 1135.11, with respect to milk that

was not received at a pool plant, by adding the amounts computed in

paragraphs (a) through (h) of this section and subtracting from that

total amount the value computed in paragraph (i) of this section. 

Unless otherwise specified, the skim milk, butterfat, and the

combined pounds of skim milk and butterfat referred to in this

section shall result from the steps set forth in § 1000.44(a), (b),

and (c), respectively, and the nonfat components of producer milk in

each class shall be based upon the proportion of such nonfat

components in producer skim milk. Receipts of nonfluid milk products

that are distributed as labeled reconstituted milk for which payments

are made to the producer-settlement fund of another Federal order

under § 1000.76(a)(4) or (d) shall be excluded from pricing under

this section. 

(a) Class I value.

(1) Multiply the hundredweight of skim milk in Class I by the

Class I skim milk price; and

(2) Add an amount obtained by multiplying the pounds of

butterfat in Class I by the Class I butterfat price.

(b) Class II value.

(1) Multiply the pounds of nonfat solids in Class II skim milk

by the Class II nonfat solids price; and

(2) Add an amount obtained by multiplying the pounds of

butterfat in Class II times the Class II butterfat price.

(c) Class III value.

(1) Multiply the pounds of protein in Class III skim milk by

the protein price;

(2) Add an amount obtained by multiplying the pounds of other

solids in Class III skim milk by the other solids price; and

(3) Add an amount obtained by multiplying the pounds of

butterfat in Class III by the butterfat price.

(d) Class IV value.

(1) Multiply the pounds of nonfat solids in Class IV skim milk

by the nonfat solids price; and

(2) Add an amount obtained by multiplying the pounds of

butterfat in Class IV by the butterfat price.

(e) Multiply the pounds of skim milk and butterfat overage

assigned to each class pursuant to § 1000.44(a)(11) and the

corresponding step of § 1000.44(b) by the skim milk prices and

butterfat prices applicable to each class.

(f) Multiply the difference between the current month’s Class
I, II, or III price, as the case may be, and the Class IV price for

the preceding month by the hundredweight of skim milk and butterfat

subtracted from Class I, II, or III, respectively, pursuant to §

1000.44(a)(7) and the corresponding step of § 1000.44(b);

(g) Multiply the difference between the Class I price

applicable at the location of the pool plant and the Class IV price

by the hundredweight of skim milk and butterfat assigned to Class I

pursuant to § 1000.43(d) and the hundredweight of skim milk and

butterfat subtracted from Class I pursuant to § 1000.44(a)(3)(i)

through (vi) and the corresponding step of § 1000.44(b), excluding

receipts of bulk fluid cream products from plants regulated under

other Federal orders and bulk concentrated fluid milk products from

pool plants, plants regulated under other Federal orders, and

unregulated supply plants.

(h) Multiply the difference between the Class I price

applicable at the location of the nearest unregulated supply plants

from which an equivalent volume was received and the Class III price

by the pounds of skim milk and butterfat in receipts of concentrated

fluid milk products assigned to Class I pursuant to § 1000.43(d) and

§ 1000.44(a)(3)(i) and the corresponding step of § 1000.44(b) and the

pounds of skim milk and butterfat subtracted from Class I pursuant to

§ 1000.44(a)(8) and the corresponding step of § 1000.44(b), excluding

such skim milk and butterfat in receipts of fluid milk products from

an unregulated supply plant to the extent that an equivalent amount

of skim milk or butterfat disposed of to such plant by handlers fully

regulated under any Federal milk order is classified and priced as

Class I milk and is not used as an offset for any other payment

obligation under any order.

(i) For reconstituted milk made from receipts of nonfluid milk

products, multiply $1.00 (but not more than the difference between

the Class I price applicable at the location of the pool plant and

the Class IV price) by the hundredweight of skim milk and butterfat

contained in receipts of nonfluid milk products that are allocated to

Class I use pursuant to § 1000.43(d).

§ 1135.61 Computation of producer price differential.

For each month the market administrator shall compute a

producer price differential per hundredweight. The report of any

handler who has not made payments required pursuant to § 1135.71 for

the preceding month shall not be included in the computation of the

producer price differential, and such handler’s report shall not be

included in the computation for succeeding months until the handler

has made full payment of outstanding monthly obligations. Subject to

the conditions of this paragraph, the market administrator shall

compute the producer price differential in the following manner:

(a) Combine into one total the values computed pursuant to

§ 1135.60 for all handlers required to file reports prescribed in
§ 1135.30;

(b) Subtract the total values obtained by multiplying each

handler's total pounds of protein, other solids, and butterfat

contained in the milk for which an obligation was computed pursuant

to § 1135.60 by the protein price, the other solids price, and the

butterfat price, respectively;

(c) Add an amount equal to the minus location adjustments and

subtract an amount equal to the plus location adjustments computed

pursuant to § 1135.75;

(d) Add an amount equal to not less than one-half of the

unobligated balance in the producer-settlement fund;

(e) Divide the resulting amount by the sum of the following

for all handlers included in these computations:

(1) The total hundredweight of producer milk; and

(2) The total hundredweight for which a value is computed

pursuant to § 1135.60(h); and

(f) Subtract not less than 4 cents nor more than 5 cents from

the price computed pursuant to paragraph (e) of this section. The

result shall be known as the producer price differential for the

month.

§ 1135.62 Announcement of producer prices.

On or before the 12th day after the end of each month, the

market administrator shall announce publicly the following prices and

information:

(a) The producer price differential;

(b) The protein price;

(c) The nonfat solids price;

(d) The other solids price;

(e) The butterfat price;

(f) [Reserved]

(g) The average butterfat, protein, nonfat solids, and other

solids content of producer milk; and

(h) The statistical uniform price for milk containing 3.5

percent butterfat, computed by combining the Class III price and the

producer price differential.

PAYMENTS FOR MILK

§ 1135.70 Producer-settlement fund.

See § 1000.70.

§ 1135.71 Payments to the producer-settlement fund.

Each handler shall make payment to the producer-settlement fund

in a manner that provides receipt of the funds by the market

administrator no later than the 14th day after the end of the month

(except as provided in § 1000.90). Payment shall be the amount, if

any, by which the amount specified in paragraph (a) of this section
exceeds the amount specified in paragraph (b) of this section:

(a) The total value of milk to the handler for the month as

determined pursuant to § 1135.60.

(b) The sum of:

(1) An amount obtained by multiplying the total hundredweight

of producer milk as determined pursuant to § 1000.44(c) by the

producer price differential as adjusted pursuant to § 1135.75;

(2) An amount obtained by multiplying the total pounds of

protein, other solids, and butterfat contained in producer milk by

the protein, other solids, and butterfat prices respectively;

(3) [Reserved]

(4) An amount obtained by multiplying the pounds of skim milk

and butterfat for which a value was computed pursuant to § 1135.60(h)

by the producer price differential as adjusted pursuant to § 1135.75

for the location of the plant from which received.

§ 1135.72 Payments from the producer-settlement fund.

No later than the 15th day after the end of each month (except

as provided in § 1000.90), the market administrator shall pay to each

handler the amount, if any, by which the amount computed pursuant to

§ 1135.71(b) exceeds the amount computed pursuant to § 1135.71(a). 

If, at such time, the balance in the producer-settlement fund is

insufficient to make all payments pursuant to this section, the

market administrator shall reduce uniformly such payments and shall

complete the payments as soon as the funds are available.

§ 1135.73 Payments to producers and to cooperative associations. 

(a) Except as provided in paragraph (b) of this section, each

handler shall make payment to each producer from whom milk is

received during the month as follows: 

(1) Partial Payment. On or before the 25th day of each month

(except as provided in § 1000.90) to each producer an amount not less

than 1.2 times the lowest class price for the preceding month

multiplied by the hundredweight of milk received from such producer

during the first 15 days of the month, less proper deductions

authorized in writing by such producer to be made from payments due

pursuant to this paragraph.

(2) Final Payment. On or before the 17th day of the following

month (except as provided in § 1000.90), not less than an amount

computed by the sum of the following:

(i) The hundredweight of producer milk received times the

producer price differential for the month as adjusted pursuant to §

1135.75;

(ii) The pounds of butterfat in producer milk received times

the butterfat price for the month;

(iii) The pounds of protein in producer milk received times

the protein price for the month;
(iv) The pounds of other solids in producer milk received

times the other solids price for the month;

(v) [Reserved]

(vi) Less any payments made pursuant to paragraph (a)(1) of

this section;

(vii) Less proper deductions authorized in writing by such

producer and plus or minus adjustments for errors in previous

payments to such producer subject to approval by the market

administrator; and

(viii) Less deductions made for marketing service pursuant to

§ 1000.86.

(b) One day prior to the dates on which partial and final

payments are due pursuant to paragraph (a) of this section, each pool

plant operator shall pay a cooperative association for milk received

as follows:

(1) Partial payment to a cooperative association for bulk milk

received directly from producers’ farms. For bulk milk (including

the milk of producers who are not members of such association and who

the market administrator determines have authorized the cooperative

association to collect payment for their milk) received during the

first 15 days of the month from a cooperative association in any

capacity, except as the operator of a pool plant, the payment shall

be an amount not less than 1.2 times the lowest class price for the

preceding month multiplied by the hundredweight of milk. 

(2) Partial payment to a cooperative association for milk

transferred from its pool plant. For bulk fluid milk products and

bulk fluid cream products received during the first 15 days of the

month from a cooperative association in its capacity as the operator

of a pool plant, the partial payment shall be at the pool plant

operator’s estimated use value of the milk using the most recent

class prices available at the receiving plant’s location. 

(3) Final payment to a cooperative association for milk

transferred from its pool plant. For the total quantity of bulk fluid

milk products and bulk fluid cream products received from a

cooperative association in its capacity as the operator of a pool

plant, the final payment shall be at not less than the total value of

such products received from the association's pool plants, as

determined by multiplying the respective quantities assigned to each

class under § 1000.44, as follows: 

(i) The hundredweight of Class I skim milk times the Class I

skim milk price for the month plus the pounds of Class I butterfat

times the Class I butterfat price for the month. The Class I prices

to be used shall be the prices effective at the location of the

receiving plant;

(ii) The pounds of nonfat solids in Class II skim milk by the

Class II nonfat solids price;

(iii) The pounds of butterfat in Class II times the Class II
butterfat price;

(iv) The pounds of nonfat solids in Class IV times the nonfat

solids price;

(v) The pounds of butterfat in Class III and Class IV milk

times the butterfat price;

(vi) The pounds of protein in Class III milk times the protein

price;

(vii) The pounds of other solids in Class III milk times the

other solids price; and

(viii) Add together the amounts computed in paragraphs

(b)(3)(i) through (vii) of this section and from that sum deduct any

payment made pursuant to paragraph (b)(1) of this section.

(4) Final payment to a cooperative association for bulk milk

received directly from producers’ farms. For bulk milk received from

a cooperative association during the month, including the milk of

producers who are not members of such association and who the market

administrator determines have authorized the cooperative association

to collect payment for their milk, the final payment for such milk

shall be an amount equal to the sum of the individual payments

otherwise payable for such milk pursuant to paragraph (a)(2) of this

section. 

(c) If a handler has not received full payment from the market

administrator pursuant to § 1135.72 by the payment date specified in

paragraph (a) or (b) of this section, the handler may reduce pro rata

its payments to producers or to the cooperative association by not

more than the amount of such underpayment. The payments shall be

completed on the next scheduled payment date after receipt of the

balance due from the market administrator.

(d) If a handler claims that a required payment to a producer

cannot be made because the producer is deceased or cannot be located,

or because the cooperative association or its lawful successor or

assignee is no longer in existence, the payment shall be made to the

producer settlement fund, and in the event the handler subsequently

locates and pays the producer or a lawful claimant, or in the event

that the handler no longer exists and a lawful claim is later

established, the market administrator shall make the required payment

from the producer- settlement fund to the handler or to the lawful

claimant, as the case may be.

(e) In making payments to producers pursuant to this section,

each handler shall furnish each producer, except a producer whose

milk was received from a cooperative association handler described in

§ 1000.9(a) or (c), a supporting statement in a form that may be

retained by the recipient which shall show:

(1) The name, address, Grade A identifier assigned by a duly

constituted regulatory agency, and payroll number of the producer;

(2) The daily and total pounds, and the month and dates such

milk was received from that producer;
(3) The total pounds of butterfat, protein, and other solids

contained in the producer’s milk;

(4) [Reserved]

(5) The minimum rate or rates at which payment to the producer

is required pursuant to the order in this part;

(6) The rate used in making payment if the rate is other than

the applicable minimum rate;

(7) The amount, or rate per hundredweight, or rate per pounds

of component, and the nature of each deduction claimed by the

handler; and

(8) The net amount of payment to the producer or cooperative

association.

§ 1135.74 [Reserved]

§ 1135.75 Plant location adjustments for producer milk and nonpool

milk.

For purposes of making payments for producer milk and nonpool

milk, a plant location adjustment shall be determined by subtracting

the Class I price specified in § 1135.51 from the Class I price at

the plant’s location. The difference, plus or minus as the case may

be, shall be used to adjust the payments required pursuant to §§

1135.73 and 1000.76. 

§ 1135.76 Payments by a handler operating a partially regulated

distributing plant.

See § 1000.76.

§ 1135.77 Adjustment of accounts.

See § 1000.77.

§ 1135.78 Charges on overdue accounts.

See § 1000.78.

ADMINISTRATIVE ASSESSMENT AND MARKETING SERVICE DEDUCTION

§ 1135.85 Assessment for order administration.

See § 1000.85.

§ 1135.86 Deduction for marketing services.

See § 1000.86.