Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules 13551

by the dates prescribed in paragraph

(d)of this section; further, at the end of

the marketing year, each such

manufacturer shall submit a statement

of its actual countable purchases of

eligible tobacco for that marketing year,

by kind, for burley and flue-cured

tobacco. For these purposes, countable

purchases of eligible tobacco shall be as

defined in, and determined under,

paragraph (b) of this section. If a

domestic manufacturer fails to file a

statement of intentions, the Director

shall declare the amount which will be

considered that manufacturer’s

intentions for the marketing year. That

declaration by the Director shall be

based on the domestic manufacturer’s

previous reports or such other

information as is deemed appropriate by

the Director in the Director’s discretion.

Notice of the amount so declared shall

be forwarded to the domestic

manufacturer. If the domestic

manufacturer fails to file a year-end

report or files an inaccurate or

incomplete report, then the Director

may deem that the manufacturer has no

purchases to report or take such other

action as the Director believes is

appropriate to fulfill the goals of this

section. Intentions and purchases of

countable tobacco will be compared for

purposes of determining whether a

penalty is due from the domestic

manufacturer.

(b) Eligible tobacco for statements of

intentions and countable purchases

toward those intentions. For reports and

determinations under this section,

eligible tobacco for purposes of

determining the countable purchases

under paragraph (a) of this section will

be unmanufactured domestic tobacco of

the relevant kind for use to

manufacture, for domestic or foreign

consumption, cigarettes, semi-processed

bulk smoking tobacco, and other

tobacco products. Eligible tobacco for

these purposes does not include tobacco

purchased for export as leaf tobacco,

stems, trimmings, or scrap. Countable

purchases of eligible tobacco shall

include purchases of eligible tobacco

made by domestic manufacturers

directly from the producers, from a

regular auction market, or from the price

support loan inventory and shall also

include purchases by the manufacturer

where the manufacturer purchases or

acquires the tobacco from dealers or

buyers who purchased the tobacco for

the domestic manufacturer during the

relevant marketing year directly from a

producer, at a regular auction market, or

from the price support loan inventory.

(c) Weight basis and nature of reports.

The weight basis used for all reports and

comparisons shall be a farm sales

weight basis unless the Director permits

otherwise and all reports will be

considered to have been made on that

basis unless the report clearly states

otherwise. Submitted reports shall be

deemed to cover countable purchases of

eligible tobacco only.

(d) Due dates and addresses for

reports. For flue-cured tobacco the

domestic manufacturer’s statement of

intentions shall be submitted by

December 1 before the marketing year

and the year-end report shall be

submitted by August 20 following the

end of the marketing year. Those dates

for burley tobacco are January 15 and

November 20, respectively. Reports

shall be mailed or delivered to the

Director, Tobacco and Peanuts Division,

STOP 0514, P.O. Box 2415, Washington,

DC 20013–2415.

(e) Penalties. A domestic

manufacturer shall be liable for a

penalty equal to twice the purchaser’s

no-net-cost assessment rate per pound

for the applicable kind of tobacco for the

relevant marketing year, if the

manufacturer’s purchases of either

burley or flue-cured tobacco for the

marketing year do not equal or exceed,

as determined by the Director, 90

percent of their stated purchase

intentions for that kind of tobacco for

the relevant marketing year. The

Director shall adjust the domestic

manufacturer’s intentions, however, to

the extent, that producers have not

produced the full amount of the

national quota for the relevant

marketing year for the particular kind of

tobacco. The burden of establishing all

purchases shall be with the domestic

manufacturer and the Director may, in

the case of indirect purchases for the

manufacturer, require that the

manufacturer obtain verification of the

purchases by the dealer who made the

purchase from the producer, at a regular

auction market, or from the price

support loan inventory, in order to

assure that the tobacco was countable

tobacco. The Director may require such

additional information as determined

needed to enforce this subpart.

(f) Penalty notice and penalty

remittance. Penalties will be assessed

after notice and an opportunity for a

hearing before the Director. Remittances

are to be made to the CCC and will be

credited to the applicable producer loan

association’s no-net-cost fund or

account as provided for in part 1464 of

this title.

(g) Maintenance and examination of

records. Each domestic manufacturer

shall keep all relevant records of

purchases, by kind, of burley and fluecured tobacco for a period of at least 3

years. The Director, Office of Inspector

General, or other duly authorized

representative of the United States may

examine such records, receipts,

computer files, or other information

held by a domestic manufacturer that

may be used to verify or audit such

manufacturer’s reports. The reasonable

cost of such examination or audit may

be charged to the domestic

manufacturer who is the subject of the

examination or audit. All records

examined or received under this part by

officials of the Department of

Agriculture shall be kept confidential to

the extent required by law.

§§ 723.1 through 723.504 [Amended]

10. Part 723 sections 723.1 through

723.504 are further amended by

removing ‘‘ASC’’ wherever it appears

and substituting ‘‘FSA’’ in its place.

Signed at Washington, DC, on March 11,

1997.

Bruce R. Weber,

Administrator, Farm Service Agency

[FR Doc. 97–6732 Filed 3–20–97; 8:45 am]

BILLING CODE 3410–05–M

Agricultural Marketing Service

7 CFR Part 1215

[FV–96–706PR]

Proposed Popcorn Promotion,

Research, and Consumer Information

Order; Referendum Order

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Proposed rule and referendum

order.

SUMMARY: This proposed rule would

establish an industry-funded promotion,

research, and consumer information

program for popcorn. An order for the

proposed program—the Popcorn

Promotion, Research, and Consumer

Information Order (Order)—was

submitted to the Department by the

Popcorn Institute. Under the proposed

Order, processors would pay an

assessment rate of 5 cents per

hundredweight of popcorn to the

proposed Popcorn Board (Board).

Composed of popcorn processors, the

Board would use the assessments

collected to conduct a generic program

of promotion, research, and consumer

information to maintain and expand

markets for popcorn. In addition, the

U.S. Department of Agriculture is

announcing that a referendum will be

conducted among eligible popcorn

processors to determine whether they

favor the implementation of the

program.
13552 Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules

DATES: In order to be eligible to vote,

popcorn processors must have

processed and marketed more than 4

million pounds during the period from

January 1 through December 31, 1996

(representative period). The referendum

will be conducted from April 15

through 30, 1997.

FOR FURTHER INFORMATION CONTACT:

Stacey L. Bryson, Research and

Promotion Branch, Fruit and Vegetable

Division, AMS, USDA, P.O. Box 96456,

Room 2535–S, Washington, DC 20090–

6456, telephone (888) 720–9917 or (202)

720–6930.

SUPPLEMENTARY INFORMATION: This

proposed order is issued under the

Popcorn Promotion, Research, and

Consumer Information Act, (7 U.S.C.

7481–7491), hereinafter referred to as

the Act.

Executive Order 12988

This rule has been reviewed under

Executive Order 12988, Civil Justice

Reform. It is not intended to have

retroactive effect. This rule would not

preempt any State or local laws,

regulations, or policies, unless they

present an irreconcilable conflict with

this rule. Further, section 580 of the Act

states that nothing in the popcorn

statute preempts or supersedes any

other program relating to popcorn

promotion organized and operated

under the laws of the United States or

any State.

The Act provides that administrative

proceedings must be exhausted before

parties may file suit in court. Under

§ 577 of the Act, after an Order is

implemented, a person subject to the

Order may file a petition with the

Secretary stating that the Order or any

provision of the Order, or any obligation

imposed in connection with the Order,

is not in accordance with law and

requesting a modification of the Order

or an exemption from the Order. The

petitioner is afforded the opportunity

for a hearing on the petition. After such

hearing, the Secretary will make a ruling

on the petition. The Act provides that

the district courts of the United States

in any district in which a person who

is a petitioner resides or carries on

business are vested with jurisdiction to

review the Secretary’s ruling on the

petition, if a complaint for that purpose

is filed within 20 days after the date of

the entry of the ruling.

Executive Order 12866 and Regulatory

Flexibility Act

This rule has been determined not

significant for purposes of Executive

Order 12866 and therefore has not been

reviewed by the Office of Management

and Budget.

In accordance with the Regulatory

Flexibility Act (5 U.S.C. 601 et seq.), the

Agency has examined the impact of the

proposed rule on small entities.

Legislation to create a generic

program of promotion and research for

popcorn became effective on April 4,

1996. Congress found that this program

is vital to the welfare of popcorn

processors and persons concerned with

marketing, using, and producing

popcorn for the market, as well as to the

agricultural economy of the United

States.

This program is intended to develop

and finance an effective and

coordinated program of promotion,

research, and consumer information to

maintain and expand the markets for

popcorn. The program was initiated by

the popcorn industry, which must

approve the program in a referendum in

advance of its implementation, and

industry members would serve on the

Board that would administer the

program under the Department’s

supervision. In addition, any person

subject to the program may file with the

Secretary a petition stating that the

order or any provision is not in

accordance with law and requesting a

modification of the order or an

exemption from the order.

Administrative proceedings were

discussed earlier in this proposed rule.

In this program, processors would

submit assessments and reports to the

Board. In addition, exempt processors

would be required to file an exemption

application. While the proposed Order

would impose certain recordkeeping

requirements on processors, information

required under the proposed Order

could be compiled from records

currently maintained. The forms require

the minimum information necessary to

effectively carry out the requirements of

the program, and their use is necessary

to fulfill the intent of the Act. The

estimated cost in providing information

to the Board by the estimated 67

respondents would be $40.32 per

respondent annually.

The Department would oversee

program operations and, if the program

is implemented, the Secretary may

conduct referenda at the request of the

Board or a representative group of

processors to determine whether the

popcorn industry supports continuation

of the program.

There are approximately 35

processors who would pay the

assessments, out of an industry of 67

processors in total.

Small agricultural service firms,

which would include processors who

would be covered under the Order, have

been defined by the Small Business

Administration (13 CFR 121.607) as

those whose annual receipts are less

than $5 million.

Almost 50 percent of the industry

would be exempt from the program.

Those processors marketing 4 million

pounds of popcorn or less annually

would be exempt from the proposed

Order. It is also estimated that only 2 of

the 35 eligible processors would be

classified as small entities. Those

processors marketing more than 4

million pounds of popcorn annually

represent the majority of the tonnage

processed each year.

The Department will seek ways to

minimize the burden of complying with

the program for the small businesses

that would be affected by it. If the

program is implemented, a compliance

guide will be issued for the small

businesses that will pay assessments as

well as those that will be exempt. In

addition, the Department will work with

the Popcorn Board to ensure, to the

extent practicable, that the procedures

implemented represent the least

burdensome alternatives.

It is estimated that there are 35

popcorn processors who will be eligible

to vote in the referendum. It will take an

average 15 minutes for each voter to

read the voting instructions and

complete the referendum ballot. The

total burden on the total number of

voters will be 2.9 hours.

The information collection

requirements under the Order require

the minimum information necessary to

effectively carry out the requirement of

the program, and their use is necessary

to fulfill the intent of the Act. The

monthly collection of information

coincides with normal business

practices and can be supplied without

data processing equipment or outside

technical expertise. In addition, there

are no additional training requirements

for individuals filling out reports and

remitting assessments to the Board. The

estimated cost in providing information

to the Board by the estimated 67

respondents would be $19.28 per

respondent annually. This total has

been estimated by multiplying 129.15

(total burden hours requested) by $10.00

per hour, a sum deemed to be

reasonable if the respondents were

compensated for their time.

According to the Popcorn Institute

(Institute), a trade association consisting

of popcorn processors representing the

industry, annual sales of popcorn were

77.240 million pounds less in 1994 than

they were in 1993, when sales totaled

approximately 1.156 billion pounds.

The peak period for popcorn sales for

home consumption is the fall. Sales

remain constant throughout the winter
Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules 13553

months and taper off during the spring

and summer.

Almost all of the popcorn consumed

throughout the world is grown in the

United States, and Americans consume

more popcorn than the citizens of any

other country. Popcorn is grown in 19

states. According to the latest Census on

Agriculture, the top five major popcornproducing states in 1992 were, in

descending order, Indiana (23 percent),

Illinois (19 percent), Nebraska (18

percent), Ohio (10 percent), and

Missouri (7 percent). This is the most

recent official information on popcorn

production released by the U.S.

government.

U.S. exports of popcorn totaled nearly

290 million pounds in 1995, with a

value of $64.7 million. According to the

Snack Food Association, retail sales of

popcorn in the United States totaled

$1.469 billion in 1994.

The proposed popcorn Order

authorizes an initial assessment on

processors of 5 cents per

hundredweight. The proposed Order

provides that the rate of assessment may

be raised or lowered as recommended

by the Board and approved by the

Secretary, but shall not exceed 8 cents

per hundredweight in any fiscal year. At

the maximum rate of assessment, it is

estimated that $800,000 would be

collected under the program. The

promotion Board would be composed of

processors, who would be

knowledgeable of the impact of any

proposed assessment on processors, and

other small entities prior to

recommending any change of the

assessment rate to the Secretary.

The proposed Order is necessary to

accomplish the statutory objectives, to

strengthen the position of the popcorn

industry in the marketplace, and to

maintain and expand domestic and

foreign markets and uses for popcorn.

Over the past several years, the

popcorn industry pursued several

limited efforts to promote the sales and

consumption of popcorn. These were

financed primarily through voluntary

contributions of some, but not all,

popcorn processors. Under the limited

and voluntary program, the resources

available were not adequate to address

the issues facing the industry from a

national perspective and did not allow

the industry to work collectively in an

industry-wide manner.

The Order provides the industry with

the opportunity to collectively address

issues in areas such as nutrition and

quality, which individual processors

could not effectively accomplish due to

lack of resources.

The industry considered pursuing a

marketing order; however, industry

believes that popcorn is not a

commodity covered under the existing

marketing order statute. Furthermore,

the marketing order system did not lend

itself to addressing the issues that the

promotion legislation clearly addresses,

for example, establishing the definition

of a processor.

In order to conduct the Regulatory

Flexibility Analysis regarding the

impact of this proposed Order on small

entities, the proposed rule that was

published in the Federal Register on

September 30, 1996 (61 FR 51046)

invited comments concerning the

potential effects of the proposed Order.

No specific comments were received

concerning the impact of the proposed

order on small entities except that a

comment from the Popcorn Institute did

note that the order would be very

beneficial to popcorn processors,

especially small processors who would

not otherwise be able to afford a

nationwide comprehensive program.

Paperwork Reduction Act

In accordance with the Office of

Management and Budget (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 that would

be imposed by this proposed Order were

approved by OMB on December 16,

1996.

Title: National Research, Promotion,

and Consumer Information Programs.

OMB Number: 0581–0093.

Expiration Date of Approval: October

31, 1997.

Type of Request: Revision of a

currently approved information

collection for research and promotion

programs.

Abstract: The information collection

requirements in this request are

essential to carry out the intent of the

Act.

While the proposed Order would

impose certain recordkeeping

requirements on processors, information

required under the proposed Order

could be compiled from records

currently maintained. The proposed

Order’s provisions have been carefully

reviewed and every effort has been

made to minimize any unnecessary

recordkeeping costs or requirements.

Although the proposed Order would

impose some additional costs and

requirements, it is anticipated that the

program under the proposed Order

would help to increase the demand and

expand markets for popcorn. Therefore,

any additional costs should be offset by

the benefits derived from expanded

markets and sales benefiting all

segments of the popcorn industry.

The forms require the minimum

information necessary to effectively

carry out the requirements of the

program, and their use is necessary to

fulfill the intent of the Act. Such

information can be supplied without

data processing equipment or outside

technical expertise. In addition, there

are no additional training requirements

for individuals filling out reports and

remitting assessments to the promotion

Board. The forms would be simple, easy

to understand, and place as small a

burden as possible on the person

required to file the information.

Collecting information less frequently

would hinder the Board from effectively

carrying out the provisions of its

program. Collecting information

monthly coincides with normal

business practices. Requiring reports

less frequently than monthly would

impose additional recordkeeping

requirements by requiring information

from several months to be consolidated

prior to filling out the form rather than

just copying end-of-month figures

already available on to the forms. The

timing and frequency of collecting

information is intended to meet the

needs of the industry while minimizing

the amount of work necessary to fill out

the required reports. In addition, the

information to be included on these

forms is not available from other sources

because such information relates

specifically to individual processors

who are subject to or exempted from the

provisions of the Act. Therefore, there is

no practical method for collecting the

required information without the use of

these forms.

In its comments on the proposed

order concerning the information

collection requirements, the Popcorn

Institute reviewed the estimates

presented in the proposed rule. It agreed

with the Department on the estimates

for the exemption application and the

referendum ballot. It also stated that

each of the information collection

requirements presented is necessary for

proper functioning of the program and

government oversight and that the

Board may want to consider developing

a system whereby processors could

submit the required reports

electronically.

However, the Institute raised issues

on the other information collections.

Regarding nominations, the Institute’s

comment noted that respondents are not

required to provide any other

information with the nominations. This

is correct. During the nomination

process, respondents will nominate

individuals to serve on the Board.
13554 Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules

Regarding the nominations

background statement, the Institute

stated that the person making the

nomination will submit the

information—not the processor who is

nominated. The Institute is incorrect in

this instance. Each person nominated to

serve on the Board must file a

background statement with the

Secretary of Agriculture. Only the final

nominees chosen by the popcorn

industry will be required to submit this

form. The proposed rule estimated that

there would be 20 respondents. This

number should be 18 because there will

be two nominees for each of the nine

seats on the Board. Therefore, we have

changed the burden information for this

form accordingly.

Regarding the periodic report filed by

processors, the Institute correctly points

out that the number of responses per

respondent would be four (not 12).

Therefore, the burden for this form has

been changed accordingly.

Regarding the requirement to

maintain records, the Institute states in

its comment that only processors of

more than 4 million pounds of popcorn

annually would be required to submit

reports. This is correct. However, all

processors will be required to maintain

records. Processors of more than 4

million pounds of popcorn annually

will be required to maintain records to

document information contained in the

reports they submit which indicate the

amount of assessments due. Exempt

processors will be required to maintain

records to document their exempt

status.

The estimated cost in providing

information to the Board by the

estimated 67 respondents would be

$19.28 per respondent annually. This

total has been estimated by multiplying

129.15 (total burden hours requested) by

$10.00 per hour, a sum deemed to be

reasonable if the respondents were

compensated for their time.

Information collection requirements

that are included in this proposal

include:

(1) A periodic report by each person

who processes popcorn.

Estimate of Burden: Public reporting

burden for this collection of information

is estimated to average .5 hours per each

processor reporting on popcorn

processed.

Respondents: Processors.

Estimated Number of Respondents:

35.

Estimated Number of Responses per

Respondent: 4.

Estimated Total Annual Burden on

Respondents: 70 hours.

(2) An exemption application for

processor of popcorn processing 4

million pounds or less a year.

Estimate of Burden: Public reporting

burden for this collection of information

is estimated to average .25 hours per

response for each exempt processor.

Respondents: Exempt processors.

Estimated Number of Respondents:

32.

Estimated Number of Responses per

Respondent: 1.

Estimated Total Annual Burden on

Respondents: 8 hours.

(3) A referendum ballot to be used to

determine whether processors covered

by the Order favor implementation or

continuance of the Order.

Estimate of Burden: Public reporting

burden for this collection of information

is estimated to average .25 hours per

response for each processor.

Respondents: Processors.

Estimated Number of Respondents:

35.

Estimated Number of Responses per

Respondent: 1 every 3 years.

Estimated Total Annual Burden on

Respondents: 2.9 hours.

(4) Nominations.

Estimate of Burden: Public reporting

burden for this collection of information

is estimated to average .5 hours per

response.

Respondents: Processors.

Estimated number of Respondents:

35.

Estimated Number of Responses per

Respondent: 1 every 3 years (.33).

Estimated Total Annual Burden on

Respondents: 5.75 hours.

(5) Nominations background

statement.

Estimate of Burden: Public reporting

burden for this collection of information

is estimated to average .5 hours per

response.

Respondents: Processors.

Estimated number of Respondents: 18

for initial Board and 6 annually

thereafter.

Estimated Number of Responses per

Respondent: 1.

Estimated Total Annual Burden on

Respondents: 9 hours for initial Board

and 3 hours annually thereafter.

(6) A requirement to maintain records

sufficient to verify reports submitted

under the Order.

Estimate of Burden: Public

recordkeeping burden for keeping this

information is estimated to average .5

hours per recordkeeper maintaining

such records.

Recordkeepers: Processors.

Estimated number of Recordkeepers:

67.

Estimated Total Recordkeeping

Hours: 33.5 hours.

Background

The Act authorizes the Secretary of

Agriculture (Secretary) to establish a

popcorn promotion, research, and

consumer information program. The

program would be funded by an

assessment on processors not to exceed

8 cents per hundredweight of popcorn.

Assessments would be used to pay

for: Promotion, research, and consumer

information; administration,

maintenance, and functioning of the

Board; and expenses incurred by the

Secretary in implementing and

administering the Order, including

referendum costs.

Consistent with the Act, processors

would be required to maintain records

regarding the collection, payment, or

remittance of the assessments. All

information obtained through processor

reports would be kept confidential.

Assessments would be collected in a

manner prescribed by the Board. The

collection of assessments would

commence on all popcorn processed in

the United States on or after the date

established by the Secretary, and would

continue until terminated by the

Secretary.

The Act requires the Secretary to

conduct a referendum during the 60-day

period preceding the proposed Order’s

effective date. Popcorn processors of

more than 4 million pounds annually

would vote in the referendum to

determine whether they favor the

proposed Order’s implementation. The

proposed Order must be approved by a

majority of eligible processors voting in

the referendum, and processors favoring

approval must process more than 50

percent of the total volume of popcorn

processed by persons voting in the

referendum. Subsequent referenda

would be conducted not earlier than

three years after the effective date of the

proposed Order at the request of the

Board or a representative group of

processors covered by the proposed

Order.

A final rule on the referendum

procedures which will be used is

published separately in this issue of the

Federal Register.

The Act provides for the submission

of proposals for a popcorn promotion,

research, and consumer information

order by industry organizations or any

other interested person affected by the

Act. As stated earlier, the Act requires

that the proposed Order provide for the

establishment of the Board. The Board

would be composed of nine members.

Each member would serve a three-year

term of office.

The Department issued a news release

on May 22, 1996, requesting proposals
Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules 13555

for an initial Order or portions of an

initial Order.

An entire proposed Order was

submitted by the Institute. In addition to

minor editorial changes, the Department

modified the Institute’s proposed text

by: adding definitions for ‘‘Part and

subpart;’’ ‘‘Board member;’’ and ‘‘State;’’

combining the nominations and

appointment sections; adding the

requirement that the industry submit

two nominees per position and a term

of office limitation; creating a section on

the removal of Board members; adding

the duty for the Board to investigate

violations of the Act, Order, and

regulations; creating a contracts section;

adding four requirements for budgets

and expenses; providing that the

Department’s user fee shall not exceed

15 percent of the Board’s projected

annual revenues (the Popcorn Institute

had recommended a 10 percent cap,

which is inconsistent with the Act);

limiting the Board’s borrowing authority

to its first year of operation; adding a

reference to federal debt collection

provisions; and adding the requirement

for processors to provide the Board with

their Social Security Number or

Employer Identification Number and the

amount of assessments paid on exported

popcorn. In addition, the Department

drafted proposed exemption procedures.

Additional modifications were also

made to provide consistency with the

Act.

A proposed rule seeking comments on

a proposed popcorn promotion,

research, and consumer information

order was published on September 30,

1996, in the Federal Register (61 FR

51046). Comments were to be received

by November 29, 1996. Six comments

concerning the proposed rulemaking

were received. One comment was from

the Popcorn Institute concerning

information collection requirements.

This comment has been discussed

herein in relation to the Paperwork

Reduction Act. A second comment was

received from the Popcorn Institute.

That comment suggested adoption of the

proposed rule and provided a sectionby-section analysis of the proposed

Order. Separate comments were

received from five popcorn processors

supporting the comments submitted by

the Popcorn Institute.

In the Popcorn Institute’s section by

section analysis, there were references

to implementation of the Order and

regulations. Any Order and regulations

promulgated will be issued and applied

in accordance with the applicable law,

including the Popcorn Promotion,

Research, and Consumer Information

Act.

Except for a revision in § 1215.60(a)(4)

for clarity, no changes to the proposed

Order are made as a result of the

comments received on the text of the

Order provisions as they were proposed

in the September 30, 1996, Federal

Register.

The proposed Order is summarized as

follows:

Sections 1215.1 through 1215.20 of

the proposed Order define certain terms,

such as popcorn, processor, and

process, which are used in the proposed

Order.

Sections 1215.21 through 1215.30

include provisions relating to the

establishment and membership of the

Board; nominations and appointment;

terms of office; vacancies; removal;

procedure; compensation and

reimbursement; powers; and duties of

the Board. The Board would be the body

organized to administer the Order

through the implementation of

programs, plans, projects, budgets, and

contracts to promote and disseminate

information about popcorn, under the

supervision of the Secretary. Further,

the Board would be authorized to incur

expenses necessary for the performance

of its duties and to set a reserve fund.

Sections 1215.40 through 1215.41 and

1215.50 provide information on these

activities.

Sections 1215.51 through 1215.53

would authorize the collection of

assessments, specify who pays them and

how, and specifies individuals who

would be exempt from paying the

assessment. In addition, it would

prohibit use of funds to influence

government policy or action.

Except as otherwise provided by the

Board and approved by the Secretary,

the rate of assessment would be 5 cents

per hundredweight of popcorn.

The assessment section also outlines

the procedures to be followed by

processors for remitting assessments

and authorize a interest charge for

unpaid or late assessments.

Sections 1215.60 through 1215.62

concern reporting and recordkeeping

requirements for persons subject to the

Order and protect the confidentiality of

information obtained from such books,

records, or reports.

Sections 1215.60 through 1215.63

describe the rights of the Secretary,

authorize the Secretary to suspend or

terminate the Order when deemed

appropriate, and prescribe proceedings

after suspension or termination.

Sections 1215.64 through 1215.77

include the provisions involving

personal liability of Board members and

employees; handling of patents,

copyrights, inventions, and others;

amendments to the Order; and

separability of Order provisions.

In addition, the Institute states that

the term ‘‘initially transferred’’ with

reference to the number of pounds of

popcorn marketed or otherwise subject

to assessments in § 1215.60(a)(4) is

confusing and should be removed. This

change has merit. Therefore,

§ 1215.60(a)(4) is changed accordingly.

Referendum Order

It is hereby directed that a referendum

be conducted among popcorn

processors to determine whether they

favor implementation of the Popcorn

Promotion, Research, and Consumer

Information Order.

The referendum shall be conducted

from April 15 through 30, 1997. Ballots

will be mailed to all known eligible

popcorn processors on or before April 7,

1997. Eligible voters that do not receive

a ballot by mail should call the

following toll-free telephone number to

receive a ballot: 1 (888) 720–9917. All

ballots will be subject to verification.

Ballots must be received by the

referendum agents no later than April

30, 1997, to be counted.

Stacey L. Bryson and Martha B.

Ransom, Research and Promotion

Branch, Fruit and Vegetable Division,

Agricultural Marketing Service, U.S.

Department of Agriculture, Room 2535–

S, PO Box 96456, Washington, DC

20090–6456, are designated as the

referendum agents of the Secretary of

Agriculture to conduct the referendum.

The Procedure for the Conduct of

Referenda in Connection with the

Popcorn Promotion, Research, and

Consumer Information Order, 7 CFR

1215.500–1215.507, which is being

published separately, shall be used to

conduct the referendum.

List of Subjects in 7 CFR Part 1215

Administrative practice and

procedure, Advertising, Consumer

information, Marketing agreements,

Popcorn, Promotion, Reporting and

recordkeeping requirements.

For the reasons set forth in the

preamble, it is proposed that Title 7,

chapter XI of the Code of Federal

Regulations be amended as follows:

1. Part 1215 is proposed to be added

to read as follows:
13556 Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules

PART 1215—POPCORN PROMOTION,

RESEARCH, AND CONSUMER

INFORMATION

Subpart A—Popcorn Promotion, Research,

and Consumer Information Order

Definitions

Sec.

1215.1 Act.

1215.2 Board.

1215.3 Board member.

1215.4 Commerce.

1215.5 Consumer information.

1215.6 Department

1215.7 Fiscal year.

1215.8 Industry information.

1215.9 Marketing.

1215.10 Part and subpart.

1215.11 Person.

1215.12 Popcorn.

1215.13 Process.

1215.14 Processor.

1215.15 Programs, plans, and projects.

1215.16 Promotion.

1215.17 Research.

1215.18 Secretary.

1215.19 State.

1215.20 United States.

Popcorn Board

1215.21 Establishment and membership.

1215.22 Nominations and appointment.

1215.23 Acceptance.

1215.24 Term of office.

1215.25 Vacancies.

1215.26 Removal.

1215.27 Procedure.

1215.28 Compensation and reimbursement.

1215.29 Powers.

1215.30 Duties.

Promotion, Research, Consumer

Information, and Industry Information

1215.40 Programs, plans, and projects.

1215.41 Contracts

Expenses and Assessments

1215.50 Budget and expenses.

1215.51 Assessments.

1215.52 Exemption from assessment.

1215.53 Influencing governmental action.

Reports, Books, and Records

1215.60 Reports.

1215.61 Books and records.

1215.62 Confidential treatment.

Miscellaneous

1215.70 Right of the Secretary.

1215.71 Suspension or termination.

1215.72 Proceedings after termination.

1215.73 Effect of termination or

amendment.

1215.74 Personal liability.

1215.75 Patents, copyrights, inventions,

publications, and product formulations.

1215.76 Amendments.

1215.77 Separability.

Subpart B—Rules and Regulations

Definitions

1215.100 Terms defined.

Exemption Procedures

1215.300 Exemption procedures.

Miscellaneous

1215.400 OMB control numbers.

Authority: 7 U.S.C. 7481–7491.

Subpart A—Popcorn Promotion,

Research, and Consumer Information

Order

Definitions

§ 1215.1 Act.

Act means the Popcorn Promotion,

Research, and Consumer Information

Act of 1995, Subtitle E of Title V of the

Federal Agriculture Improvement and

Reform Act of 1996, Pub. L. 104–127, 7

U.S.C. 7481–7491, and any amendments

thereto.

§ 1215.2 Board.

Board means the Popcorn Board

established under section 575(b) of the

Act.

§ 1215.3 Board member.

Board member means an officer or

employee of a processor appointed by

the Secretary to serve on the Popcorn

Board as a representative of that

processor.

§ 1215.4 Commerce.

Commerce means interstate, foreign,

or intrastate commerce.

§ 1215.5 Consumer information.

Consumer information means

information and programs that will

assist consumers and other persons in

making evaluations and decisions

regarding the purchasing, preparing,

and use of popcorn.

§ 1215.6 Department.

Department means the United States

Department of Agriculture.

§ 1215.7 Fiscal year.

Fiscal year means the 12-month

period from January 1 through

December 31 each year, or such other

period as recommended by the Board

and approved by the Secretary.

§ 1215.8 Industry information.

Industry information means

information and programs that will lead

to the development of new markets, new

marketing strategies, or increased

efficiency for the popcorn industry, or

activities to enhance the image of the

popcorn industry.

§ 1215.9 Marketing.

Marketing means the sale or other

disposition of unpopped popcorn for

human consumption in a channel of

commerce but shall not include sales or

disposition to or between processors.

§ 1215.10 Part and subpart.

Part means the Popcorn Promotion,

Research, and Consumer Information

Order and all rules and regulations and

supplemental orders issued thereunder,

and the term subpart means the Popcorn

Promotion, Research, and Consumer

Information Order.

§ 1215.11 Person.

Person means any individual, group

of individuals, partnership, corporation,

association, cooperative, or any other

legal entity.

§ 1215.12 Popcorn.

Popcorn means unpopped popcorn

(Zea Mays L) that is commercially

grown, processed in the United States

by shelling, cleaning, or drying, and

introduced into a channel of commerce.

§ 1215.13 Process.

Process means to shell, clean, dry,

and prepare popcorn for the market, but

does not include packaging popcorn for

the market without also engaging in

another activity described in this

paragraph.

§ 1215.14 Processor.

Processor means a person engaged in

the preparation of unpopped popcorn

for the market who owns or who shares

the ownership and risk of loss of such

popcorn and who processes and

distributes over 4 million pounds of

popcorn in the market per year.

§ 1215.15 Programs, plans, and projects.

Programs, plans, and projects means

promotion, research, consumer

information, and industry information

plans, studies, projects, or programs

conducted pursuant to this part.

§ 1215.16 Promotion.

Promotion means any action,

including paid advertising, to enhance

the image or desirability of popcorn.

§ 1215.17 Research.

Research means any type of study to

advance the image, desirability,

marketability, production, product

development, quality, or nutritional

value of popcorn.

§ 1215.18 Secretary.

Secretary means the Secretary of

Agriculture of the United States or any

officer or employee of the Department to

whom authority has heretofore been

delegated, or to whom authority may

hereafter be delegated, to act in the

Secretary’s stead.

§ 1215.19 State.

State means each of the 50 States and

the District of Columbia.
Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules 13557

§ 1215.20 United States.

United States means all of the States.

Popcorn Board

§ 1215.21 Establishment and membership.

(a) There is hereby established a

Popcorn Board of nine members. The

number of members on the Board may

be changed by regulation: Provided,

That the Board consist of not fewer than

four members and not more than nine

members. The Board shall be composed

of popcorn processors appointed by the

Secretary under § 1215.24.

(b) For purposes of nominating and

appointing processors to the Board, the

Secretary shall, to the extent practicable,

take into account the geographic

distribution of popcorn production.

(c) No more than one officer or

employee of a processor may serve as a

Board member at the same time.

§ 1215.22 Nominations and appointment.

(a) All nominations for appointments

to the Board established under § 1215.21

shall be made as follows:

(1) As soon as practicable after the

effective date of this subpart,

nominations for appointment to the

initial Board shall be obtained from

processors by the Secretary. In any

subsequent year in which an

appointment to the Board is to be made,

nominations for positions for which the

term will expire at the end of that year

shall be obtained from processors at

least six months prior to the expiration

of terms.

(2) Except for initial Board members,

whose nomination process will be

initiated by the Secretary, the Board

shall issue a call for nominations in

each year for which an appointment to

the Board is to be made. The call shall

include, at a minimum, the following

information:

(i) A list of the vacancies for which

nominees may be submitted and

qualifications for nomination; and

(ii) The date by which the names of

nominees shall be submitted to the

Secretary for consideration to be in

compliance with paragraph (a) of this

section.

(3)(i) Nominations for each position

shall be made by processors. Notice

shall be publicized to all processors.

(ii) All processors may participate in

submitting nominations.

(4) Two nominees must be submitted

for each vacancy. If processors fail to

nominate a sufficient number of

nominees, additional nominees shall be

obtained in a manner prescribed by the

Secretary.

(b) The Secretary shall appoint the

members of the Board from nominations

made in accordance with paragraph (a).

of this section.

(1) The Secretary may reject any

nominee submitted. If there is an

insufficient number of nominees from

whom to appoint members to the Board

as a result of the Secretary’s rejecting

such nominees, additional nominees

shall be submitted to the Secretary in a

manner prescribed by the Secretary.

(2) Whenever processors cannot agree

on nominees for a position on the Board

under the preceding provisions of this

section, or whenever they fail to

nominate individuals for appointment

to the Board, the Secretary may appoint

members in such a manner as the

Secretary determines appropriate.

(3) If a processor nominates more than

one officer or employee, only one may

be appointed to the Board by the

Secretary.

§ 1215.23 Acceptance.

Each individual nominated for

membership of the Board shall qualify

by filing a written acceptance with the

Secretary at the time of nomination.

§ 1215.24 Term of office.

(a) The members of the Board shall

serve for terms of three years, except

that members appointed to the initial

Board shall serve, to the extent

practicable, proportionately for terms of

two, three, and four years.

(b)(1) Except with respect to terms of

office of the initial Board, the term of

office for each Board member shall

begin on the date the member is seated

at the Board’s annual meeting or such

other date that may be approved by the

Secretary.

(2) The term of office for the initial

Board member shall begin immediately

following the appointment by the

Secretary.

(c) Board members shall serve during

the term of office for which they are

appointed and have qualified, and until

their successors are appointed and have

qualified.

(d) No Board member may serve more

than two consecutive three-year terms,

except as provided in § 1215.25(d).

Initial members serving two-or four-year

terms may serve one successive threeyear term.

§ 1215.25 Vacancies.

(a) To fill any vacancy occasioned by

the death, removal, resignation, or

disqualification of any member of the

Board, the Secretary may appoint a

successor from the most recent

nominations submitted for positions on

the Board or the Secretary may obtain

nominees to fill such vacancy in such a

manner as the Secretary deems

appropriate.

(b) Each such successor appointment

shall be for the remainder of the term

vacated.

(c) A vacancy will not be required to

be filled if the unexpired term is less

than six months.

(d) If an unexpired term is less than

1.5 years, serving the term shall not

prevent the appointee from serving two

successive three-year terms.

(e) A Board member shall be

disqualified from serving on the Board

if such individual ceases to be affiliated

with the processor the member

represents.

§ 1215.26 Removal.

If a member of the Board consistently

refuses to perform the duties of a

member of the Board, or if a member of

the Board is known to be engaged in

acts of dishonesty or willful

misconduct, the Board may recommend

to the Secretary that the member be

removed from office. Further, without

recommendation of the Board, a

member may be removed by the

Secretary upon showing of adequate

cause, including the failure by a

member to submit reports or remit

assessments required under this part, if

the Secretary determines that such

member’s continued service would be

detrimental to the achievement of the

purposes of the Act.

§ 1215.27 Procedure.

(a) At a properly convened meeting of

the Board, a majority of the members

shall constitute a quorum.

(b) Each member of the Board will be

entitled to one vote on any matter put

to the Board, and the motion will carry

if supported by a simple majority of

those voting. At assembled meetings of

the Board, all votes will be cast in

person.

(c) In lieu of voting at a properly

convened meeting and, when in the

opinion of the chairperson of the Board

such action is considered necessary, the

Board may take action upon the

concurring votes by a majority of its

members by mail, telephone, facsimile,

or any other means of communication.

If appropriate, any such action shall be

confirmed promptly in writing. In that

event, all members must be given prior

notice and provided the opportunity to

vote. 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 Board. All

votes shall be recorded in Board

minutes.

(d) Meetings of the Board may be

conducted by electronic

communications, provided that each

member is given prior notice of the
13558 Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules

meeting and has the opportunity to be

present either physically or by

electronic connection.

(e) The organization of the Board and

the procedures for conducting meetings

of the Board shall be in accordance with

its bylaws, which shall be established

by the Board and approved by the

Secretary.

§ 1215.28 Compensation and

reimbursement.

The members of the Board shall serve

without compensation but shall be

reimbursed for necessary and reasonable

expenses incurred by such members in

the performance of their responsibilities

under this subpart.

§ 1215.29 Powers.

The Board shall have the following

powers:

(a) To administer the Order in

accordance with its terms and

provisions;

(b) To make rules and regulations to

effectuate the terms and provisions of

the Order;

(c) To select committees and

subcommittees of Board members,

including an executive committee, and

to adopt such bylaws and other rules for

the conduct of its business as it may

deem advisable;

(d) To appoint or employ such

individuals as it may deem necessary,

define the duties, and determine the

compensation of such individuals;

(e) To disseminate information to

processors or industry organizations

through programs or by direct contact

using the public postal system or other

systems;

(f) To propose, receive, evaluate and

approve budgets, plans and projects of

popcorn promotion, research, consumer

information and industry information,

as well as to contract with the approval

of the Secretary with appropriate

persons to implement plans and

projects.

(g) To receive, investigate, and report

to the Secretary for action any

complaints of violations of the Order;

(h) To recommend to the Secretary

amendments to the order;

(i) To accept or receive voluntary

contributions;

(j) To invest, pending disbursement

pursuant to a program, plan or project,

funds collected through assessments

authorized under this Act provided for

in § 1215.51, and any other funds

received by the Board 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 or 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.

(k) With the approval of the Secretary,

to enter into contracts or agreements

with national, regional, or State popcorn

processor organizations, or other

organizations or entities, for the

development and conduct of programs,

plans or projects authorized under

§ 1215.40 and for the payment of the

cost of such programs with assessments

received pursuant to this subpart; and

(l) Such other powers as may be

approved by the Secretary.

§ 1215.30 Duties.

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 and such

other officers as may be necessary;

(b) To evaluate or develop, and

submit to the Secretary for approval,

promotion, research, consumer

information, and industry information

programs, plans or projects;

(c) To prepare for each fiscal year, and

submit to the Secretary for approval at

least 60 days prior to the beginning of

each fiscal year, a budget of its

anticipated expenses and disbursements

in the administration of this subpart, as

provided in § 1215.50;

(d) 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;

(e) To prepare and make public, at

least annually, a report of its activities

carried out, and an accounting for funds

received and expended;

(f) To cause its financial statements to

be prepared in conformity with

generally accepted accounting

principles and to be audited by an

independent certified public accountant

in accordance with generally accepted

auditing standards at least once each

fiscal year and at such other times as the

Secretary may request, and submit a

copy of each such audit to the Secretary;

(g) To give the Secretary the same

notice of meetings of the Board as is

given to members in order that the

Secretary, or a representative of the

Secretary, may attend such meetings;

(h) To submit to the Secretary such

information as may be requested

pursuant to this subpart;

(i) To keep minutes, books and

records that clearly reflect all the acts

and transactions of the Board. Minutes

of each Board meeting shall be promptly

reported to the Secretary;

(j) To act as intermediary between the

Secretary and any processor;

(k) To investigate violations of the

Act, order, and regulations issued under

the order, conduct audits, and report the

results of such investigations and audits

to the Secretary for appropriate action to

enforce the provisions of the Act, order,

and regulations; and

(l) To work to achieve an effective,

continuous, and coordinated program of

promotion, research, consumer

information, and industry information

designed to strengthen the popcorn

industry’s position in the marketplace,

maintain and expand existing markets

and uses for popcorn, develop new

markets and uses for popcorn, and to

carry out programs, plans, and projects

designed to provide maximum benefits

to the popcorn industry.

Promotion, Research, Consumer

Information, and Industry Information

§ 1215.40 Programs, plans, and projects.

(a) The Board shall receive and

evaluate, or on its own initiative

develop, and submit to the Secretary for

approval any program, plan or project

authorized under this subpart. Such

programs, plans or projects shall

provide for:

(1) The establishment, issuance,

effectuation, and administration of

appropriate programs for promotion,

research, consumer information, and

industry information with respect to

popcorn; and

(2) The establishment and conduct of

research with respect to the sale,

distribution, marketing, and use of

popcorn, and the creation of new uses

thereof, to the end that the marketing

and use of popcorn may be encouraged,

expanded, improved, or made more

acceptable.

(b) No program, plan, or project shall

be implemented prior to its approval by

the Secretary. Once a program, plan, or

project is so approved, the Board may

take appropriate steps to implement it.

(c) Each program, plan, or project

implemented under this subpart shall be

reviewed or evaluated periodically by

the Board to ensure that it contributes

to an effective program of promotion,

research, consumer information, or

industry information. If it is found by

the Board that any such program, plan,

or project does not contribute to an

effective program of promotion,

research, consumer information, or

industry information, then the Board

shall terminate such program, plan, or

project.
Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules 13559

(d) In carrying out any program, plan,

or project, no reference to a brand name,

trade name, or State or regional

identification of any popcorn will be

made. In addition, no program, plan, or

project shall make use of unfair or

deceptive acts or practices with respect

to the quality, value, or use of any

competing product.

§ 1215.41 Contracts.

The Board shall not contract with any

processor for the purpose of promotion

or research. The Board may lease

physical facilities from a processor for

such promotion or research, if such an

arrangement is determined to be cost

effective by the Board and approved by

the Secretary. Any contract or

agreement shall provide that:

(a) The contractor or agreeing party

shall develop and submit to the Board

a program, plan or project together with

a budget or budgets that shall show the

estimated cost to be incurred for such

program, plan, or project;

(b) Any such program, plan, or project

shall become effective upon approval by

the Secretary;

(c) The contracting or agreeing party

shall keep accurate records of all of its

transactions and make periodic reports

to the Board of activities conducted,

submit accountings for funds received

and expended, and make such other

reports as the Secretary or the Board

may require; and the Secretary may

audit the records of the contracting or

agreeing party periodically; and

(d) Any subcontractor who enters into

a contract with a Board contractor and

who receives or otherwise uses funds

allocated by the Board shall be subject

to the same provisions as the contractor.

Expenses and Assessments

§ 1215.50 Budget and expenses.

(a) At least 60 days prior to the

beginning of each fiscal year, and as

may be necessary thereafter, the Board

shall prepare and submit to the

Secretary a budget for the fiscal year

covering its anticipated expenses and

disbursements in administering this

subpart.

(b) Each budget shall include:

(1) A rate of assessment for such fiscal

year calculated, subject to § 1215.51(b),

to provide adequate funds to defray its

proposed expenditures and to provide

for a reserve as set forth in paragraph (g)

of this section;

(2) A statement of the objectives and

strategy for each program, plan, or

project;

(3) A summary of anticipated revenue,

with comparative data for at least one

preceding year;

(4) A summary of proposed

expenditures for each program, plan, or

project; and

(5) Staff and administrative expense

breakdowns, with comparative data for

at least one preceding year.

(c) In budgeting plans and projects of

promotion, research, consumer

information, and industry information,

the Board shall expend assessment and

contribution funds on:

(1) Plans and projects for popcorn

marketed in the United States or Canada

in proportion to the amount of

assessments projected to be collected on

domestically marketed popcorn

(including Canada); and

(2) Plans and projects for exported

popcorn in proportion to the amount of

assessments projected to be collected on

exported popcorn (excluding Canada).

(d) The Board is authorized to incur

such reasonable 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

the provisions of this subpart. Such

expenses shall be paid from funds

received by the Board.

(e) The Board may accept voluntary

contributions, but these shall only be

used to pay expenses incurred in the

conduct of programs, plans, and projects

approved by the Secretary. Such

contributions shall be free from any

encumbrances by the donor and the

Board shall retain complete control of

their use. The Board may also receive

funds provided through the Foreign

Agricultural Service of the United States

Department of Agriculture for foreign

marketing activities.

(f) As stated in § 575(f)(4)(A)(ii) of the

Act, the Board shall reimburse the

Secretary, from funds received by the

Board, for costs incurred by the

Secretary in implementing and

administering this subpart: Provided,

That the costs incurred by the Secretary

to be reimbursed by the Board,

excluding legal costs to defend and

enforce the order, shall not exceed 15

percent of the projected annual

revenues of the Board.

(g) The Board may establish an

operating monetary reserve and may

carry over to subsequent fiscal periods

excess funds in any reserve so

established, except that the funds in this

reserve shall not exceed approximately

one fiscal year’s expenses. Such reserve

funds may be used to defray any

expenses authorized under this subpart.

(h) With the approval of the Secretary,

the Board may borrow money for the

payment of administrative expenses,

subject to the same fiscal, budget, and

audit controls as other funds of the

Board during its first year of operation

only.

§ 1215.51 Assessments.

(a) Any processor marketing popcorn

in the United States or for export shall

pay an assessment on such popcorn at

the time of introduction to market at a

rate as established in § 1215.51(c) and

shall remit such assessment to the Board

in such form and manner as prescribed

by the Board.

(b) Any person marketing popcorn of

that person’s own production to

consumers in the United States either

directly or through retail or wholesale

outlets, shall remit to the Board an

assessment on such popcorn at the rate

set forth in paragraph § 1215.51(c), and

in such form and manner as prescribed

by the Board.

(c) Except as otherwise provided, the

rate of assessment shall be 5 cents per

hundredweight of popcorn. The rate of

assessment may be raised or lowered as

recommended by the Board and

approved by the Secretary, but shall not

exceed 8 cents per hundredweight in

any fiscal year.

(d) The collection of assessments

under this section shall commence on

all popcorn processed in the United

States on or after the date established by

the Secretary, and shall continue until

terminated by the Secretary. If the Board

is not constituted on the date the first

assessments are to be collected, the

Secretary shall have the authority to

receive assessments on behalf of the

Board and may hold such assessments

until the Board is constituted, then

remit such assessments to the Board.

(e) Each person responsible for

remitting assessments under paragraphs

(a) and (b) of this section shall remit the

amounts due from assessments to the

Board on a quarterly basis no later than

the last day of the month following the

last month in the previous quarter in

which the popcorn was marketed, in

such manner as prescribed by the Board.

(f) The Board shall impose a late

payment charge on any person who fails

to remit to the Board the total amount

for which the person is liable on or

before the payment due date established

under this section. The amount of the

late payment charge shall be prescribed

in rules and regulations as approved by

the Secretary.

(g) The Board shall impose an

additional charge on any person subject

to a late payment charge, in the form of

interest on the outstanding portion of

any amount for which the person is

liable. The rate of interest shall be
13560 Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules

prescribed in rules and regulations as

approved by the Secretary.

(h) In addition, persons failing to

remit total assessments due in a timely

manner may also be subject to penalties

and actions under federal debt

collection procedures as set forth in 7

CFR 3.1 through 3.36.

(i) Any assessment that is determined

to be owing at a date later than the

payment due established under this

section, due to a person’s failure to

submit a report to the Board by the

payment due date, shall be considered

to have been payable on the payment

due date. Under such a situation,

paragraphs (f), (g), and (h) of this section

shall be applicable.

(j) The Board, with the approval of the

Secretary, may enter into agreements

authorizing other organizations or

entities to collect assessments on its

behalf. Any such organization or entity

shall be required to maintain the

confidentiality of such information as is

required by the Board for collection

purposes. Any reimbursement by the

Board for such services shall be based

on reasonable charges for services

rendered.

(k) The Board is hereby authorized to

accept advance payment of assessments

for the fiscal year by any person, that

shall be credited toward any amount for

which such person may become liable.

The Board shall not be obligated to pay

interest on any advance payment.

§ 1215.52 Exemption from assessment.

(a) Persons that process and distribute

4 million pounds or less of popcorn

annually, based on the previous year,

shall be exempted from assessment.

(b) To claim such exemption, such

persons shall apply to the Board, in the

form and manner prescribed in the rules

and regulations.

§ 1215.53 Influencing governmental action.

No funds received by the Board under

this subpart shall in any manner be used

for the purpose of influencing

legislation or governmental policy or

action, except to develop and

recommend to the Secretary

amendments to this subpart.

Reports, Books, and Records

§ 1215.60 Reports.

(a) Each processor marketing popcorn

directly to consumers, and each

processor responsible for the remittance

of assessments under § 1215.51, shall be

required to report quarterly to the

Board, on a form provided by the Board,

such information as may be required

under this subpart or any rule and

regulations issued thereunder. Such

information shall be subject to § 1215.62

and include, but not be limited to, the

following:

(1) The processor’s name, address,

telephone number, and Social Security

Number or Employer Identification

Number;

(2) The date of report, which is also

the date of payment to the Board;

(3) The period covered by the report;

(4) The number of pounds of popcorn

marketed or in any other manner are

subject to the collection of assessments;

(5) The amount of assessments

remitted;

(6) The basis, if necessary, to show

why the remittance is less than the

number of pounds of popcorn divided

by 100 and multiplied by the applicable

assessment rate; and

(7) The amount of assessments

remitted on exports (not including

Canada).

(b) The words ‘‘final report’’ shall be

shown on the last report at the end of

each fiscal year.

§ 1215.61 Books and records.

Each person who is subject to this

subpart shall maintain and make

available for inspection by the Board or

the Secretary such books and records as

are deemed necessary by the Board,

with the approval of the Secretary, to

carry out the provisions of this subpart

and any rules and regulations issued

hereunder, including such books and

records as are necessary to verify any

reports required. Such books and

records shall be retained for at least two

years beyond the fiscal year of their

applicability.

§ 1215.62 Confidential treatment.

(a) All information obtained from

books, records, or reports under the Act,

this subpart, and the rule and

regulations issued thereunder shall be

kept confidential by all persons,

including all employees, agents, and

former employees and agents of the

Board; all officers, employees, agents,

and former officers, employees, and

agents of the Department; and all

officers, employees, agents, and former

officers, employees, and agents of

contracting and subcontracting agencies

or agreeing parties having access to such

information. Such information shall not

be available to Board members or

processors. Only those persons having a

specific need for such information to

administer effectively the provisions of

this part shall have access to such

information. Only such information so

obtained as the Secretary deems

relevant shall be disclosed by them, and

then only in a suit or administrative

hearing brought at the direction, or on

the request, of the Secretary, or to which

the Secretary or any officer of the

United States is a party, and involving

this part.

(b) No information obtained under the

authority of this part may be made

available to any agency or officer of the

Federal Government for any purpose

other than the implementation of the

Act and any investigatory or

enforcement action necessary for the

implementation of the Act.

(c) Nothing in paragraph (a) of this

section may be deemed to prohibit:

(1) The issuance of general statements

based upon the reports of the number of

persons subject to this part or statistical

data collected therefrom, which

statements do not identify the

information furnished by any person;

(2) The publication, by direction of

the Secretary, of the name of any person

who has violated this part, together with

a statement of the particular provisions

of this part violated by such person.

(d) Any person who knowingly

violated the provisions of this section,

on conviction, shall be subject to a fine

of not more than $1,000 or to

imprisonment for not more than 1 year,

or both, or if the person is an officer,

employee, or agent of the Board or the

Department, that person shall be

removed from office or terminated from

employment as applicable.

Miscellaneous

§ 1215.70 Right of the Secretary.

All fiscal matters, programs, plans, or

projects, contracts, rules or regulations,

reports, or other substantive actions

proposed and prepared by the Board

shall be submitted to the Secretary for

approval.

§ 1215.71 Suspension or termination.

(a) Whenever the Secretary finds that

this subpart or any provision thereof

obstructs or does not tend to effectuate

the declared policy of the Act, the

Secretary shall terminate or suspend the

operation of this subpart or such

provision thereof.

(b) The Secretary may conduct

additional referenda to determine

whether processors favor termination or

suspension of this subpart three years

after the effective date, on the request of

a representative group comprising 30

percent or more of the number of

processors who have been engaged in

processing during a representative

period as determined by the Secretary.

(c) Whenever the Secretary

determines that suspension or

termination of this subpart is favored by

two-thirds or more of the popcorn

processors voting in a referendum under

paragraph (b) of this section who,

during a representative period
Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Proposed Rules 13561

determined by the Secretary, have been

engaged in the processing, the Secretary

shall:

(1) Suspend or terminate, as

appropriate, collection of assessments

within six months after making such

determination; and

(2) Suspend or terminate, as

appropriate, all activities under this

subpart in an orderly manner as soon as

practicable.

(d) Referenda conducted under this

subsection shall be conducted in such

manner as the Secretary may prescribe.

§ 1215.72 Proceedings after termination.

(a) Upon the termination of this

subpart, the Board shall recommend not

more than five 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 any claims

unpaid or property not delivered, or any

other claim existing at the time of such

termination.

(b) The trustees shall:

(1) Continue in such capacity until

discharged by the Secretary;

(2) Carry out the obligations of the

Board under any contract or agreement

entered into by it under this subpart;

(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 other persons full title and

right to all of the funds, property, and

claims vested in the Board or the

trustees under this subpart.

(c) Any person to whom funds,

property, or claims have been

transferred or delivered under this

subpart shall be subject to the same

obligations 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 programs, plans, or projects

authorized under this subpart.

§ 1215.73 Effect of termination or

amendment.

Unless otherwise expressly provided

by the Secretary, the termination of this

subpart or of any rule and regulation

issued under this subpart, or the

issuance of any amendment to such

provisions, shall not:

(a) Affect or waive any right, duty,

obligation, or liability that shall have

arisen or may hereafter arise in

connection with any provision of this

subpart or any such rules or regulations;

(b) Release or extinguish any violation

of this subpart or any such rules or

regulations; or

(c) Affect or impair any rights or

remedies of the United States, the

Secretary, or any person with respect to

any such violation.

§ 1215.74 Personal liability.

No member or employee 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 of such

member or employee under this subpart,

except for acts of dishonesty or willful

misconduct.

§ 1215.75 Patents, copyrights, inventions,

publications, and product formulations.

Any patents, copyrights, inventions,

publications, or product formulations

developed through the use of funds

received by the Board under this

subpart shall be the property of the

United States 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, publications, or product

formulations inure to the benefit of the

Board and be considered income subject

to the same fiscal, budget, and audit

controls as other funds of the Board.

Upon termination of this subpart,

§ 1215.72 shall apply to determine

disposition of all such property.

§ 1215.76 Amendments.

Amendments to this subpart may be

proposed, from time to time, by the

Board or by any interested persons

affected by the provisions of the Act,

including the Secretary.

§ 1215.77 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 to other persons or

circumstances shall not be affected

thereby.

Subpart B—Rules and Regulations

§ 1215.100 Terms defined.

Unless otherwise defined in this

subpart, the definitions of terms used in

this subpart shall have the same

meaning as the definitions in Subpart

A—Popcorn Promotion, Research, and

Consumer Information Order of this

part.

Exemption Procedures

§ 1215.300 Exemption procedures.

(a) Any processor who markets 4

million pounds or less of popcorn

annually and who desires to claim an

exemption from assessments during a

fiscal year as provided in § 1214.52 of

this part shall apply to the Board, on a

form provided by the Board, for a

certificate of exemption. Such processor

shall certify that the processor’s

marketing of popcorn during the

previous fiscal year was 4 million

pounds or less.

(b) Upon receipt of an application, the

Board shall determine whether an

exemption may be granted. The Board

then will issue, if deemed appropriate,

a certificate of exemption to each person

that is eligible to receive one.

(c) Any person who desires to renew

the exemption from assessments for a

subsequent fiscal year shall reapply to

the Board, on a form provided by the

Board, for a certificate of exemption.

(d) The Board may require persons

receiving an exemption from

assessments to provide to the Board

reports on the disposition of exempt

popcorn.

Miscellaneous

§ 1215.400 OMB control numbers.

The control number assigned to the

information collection requirements by

the Office of Management and Budget

pursuant to the Paperwork Reduction

Act of 1995, 44 U.S.C. Chapter 35, is

OMB control number 0581–0093, except

for the Promotion Board nominee

background statement form which is

assigned OMB control number 0505–

0001.

Dated: March 18, 1997.

Michael V. Dunn,

Assistant Secretary, Marketing and

Regulatory Programs.

[FR Doc. 97–7294 Filed 3–20–97; 8:45 am]

BILLING CODE 3410–02–P