21824 Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1240

[FV–00–701 FR]

RIN 0581–AB84

Honey Research, Promotion, and

Consumer Information Order;

Amendments

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Final rule.

SUMMARY: This rule amends the honey

research and promotion program by:

changing the size and composition of

the National Honey Board (Board);

changing nomination and eligibility

requirements for handlers, importers,

and representatives of cooperatives on

the Board; changing the term of office

for members of the Board and the

National Honey Nominations

Committee; authorizing the Board to

develop a voluntary quality assurance

program; removing the requirement for

small companies to file for an

exemption under the program in order

to avoid paying assessments; requiring

producers to submit reports to the Board

and to maintain records; and adding

statutory requirements for continuance

referenda and evaluations. Amendments

to the Honey Research, Promotion, and

Consumer Information Act (Act) require

that these changes be made to the

program. The Act authorized additional

changes, but they failed to receive the

approval of the voters in a referendum

held in September 2000.

EFFECTIVE DATE: May 31, 2001.

FOR FURTHER INFORMATION CONTACT:

Kathie M. Birdsell, Research and

Promotion Branch, Fruit and Vegetable

Programs, AMS, USDA, Stop 0244, 1400

Independence Avenue, SW., Room 2535

South Building, Washington, DC 20250–

0244; telephone (202) 720–9917 (toll

free); facsimile (202) 205–2800.

SUPPLEMENTARY INFORMATION: The honey

research and promotion program will be

changed by amending the Honey

Research, Promotion, and Consumer

Information Order (Order) (7 CFR part

1240). The changes to the Order are

being made as a result of changes made

by Congress to the Honey Research,

Promotion, and Consumer Information

Act (Act) (Pub. L. 98–690; enacted

October 30, 1984; 7 U.S.C. 4601–4613,

as amended) on June 23, 1998 (Pub. L.

105–185). The honey program operates

under the Act.

Prior documents. A proposed rule on

amending the Order was published in

the Federal Register on February 28,

2000 (65 FR 10600) with a 60-day

comment period. The comment period

ended on April 28, 2000. A second

proposed rule and a referendum order

were published in the Federal Register

on August 7, 2000 (65 FR 48324).

In addition, USDA published a

proposed rule on the referendum

procedures which were used in the

referendum on the votable amendments

in the Federal Register on May 15, 2000

(65 FR 30924) with a 30-day comment

period. The final rule on the referendum

procedures was published in the August

7, 2000, issue of the Federal Register

(65 FR 48318).

Question and Answer Overview

Why Is The Honey Program Being

Changed?

The honey program is being changed

because the Act which authorizes the

program was amended in 1998. The

amendments to the Act require the same

changes to be made to the program.

What Are the Major Changes That Will

be Made to the Honey Program?

The major changes affect: (1) The

composition and size of the National

Honey Board (Board); (2) nomination

and eligibility requirements for

handlers, importers, and representatives

of cooperatives on the Board; (3) the

term of office for members of the Board

and the National Honey Nominations

Committee (Committee); (4)

authorization for the voluntary quality

assurance program; (5) exemption,

reporting, and recordkeeping

procedures; and (6) requirements for

referenda and evaluations.

How Would the Size and Composition of

the Board Change?

The Board is currently composed of

seven producers, two importers (or one

importer and one exporter), two

handlers, one representative of a

cooperative, one public member, and

their alternates.

This rule will change the importerexporter position on the Board to

another importer position to provide

more importer input into Board

deliberations. In addition, the public

member position will be eliminated,

and at least 50 percent of the Board

members will have to be producers. In

addition, the Board will be required to

periodically review the producer

regions and number of importer

positions on the Board and recommend

any appropriate changes to the U.S.

Department of Agriculture (USDA or the

Department).

How Will Nomination and Eligibility

Procedures Change?

Currently, handlers, importers, and

others submit the names of handlers and

importers to the Committee for

consideration as the official nominees to

serve on the Board as handler members

and alternates. This rule will allow

handler and importer organizations to

be certified to submit the names of

handlers and importers to the

Committee as well. In addition, national

honey marketing cooperatives will be

allowed to submit names to the

Committee for consideration as the

official nominees for the cooperative

representative and alternate on the

Board.

This rule also adds a new eligibility

requirement for importer members and

alternates. In order to be eligible to serve

in these positions, importers must

receive at least 75 percent of their gross

honey business income from the sale of

imported honey and honey products

during any three of the preceding five

years. Previously, any person who

imported any amount of honey was

eligible to serve on the Board as an

importer member or alternate.

What Are the Changes in the Terms of

Office for Committee and Board

Members?

This rule will change the beginning of

the term of office for Committee

members from January 1 to July 1. This

will facilitate more timely nomination

and appointment of new members.

In addition, the amended Act

authorized the Secretary to stagger the

terms of office of Board members

periodically to help ensure continuity of

Board membership. For example,

currently the term of office for the

producer members and alternates from

four of the seven producer regions end

on December 31, 2001. This means that

over 50 percent of the producer

members on the Board could change in

one year. This is not desirable.

Therefore, the Secretary will work with

the Board and the Committee to

determine which of the regional

producer positions should have a

different term of office.

What Is a Voluntary Quality Assurance

Program?

After this rule becomes effective, the

Board will be allowed to develop rules

and regulations for a voluntary quality

assurance program for review by USDA.

Under this type of program, the Board

may develop an official seal of approval

to be used only by producers, handlers,

and importers who participate in the

program. In order to participate in the

Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations 21825

program, the products of the industry

members would be required to meet

certain purity standards. The goal of this

type of program is to increase demand

for honey and honey products by

increasing consumer confidence in the

honey and honey products on the

market.

How Would Exemption and

Recordkeeping Requirements Change?

Producers, producer-packers, and

importers who sell (1) less than 6,000

pounds of honey annually and (2) the

honey is sold through local retail

outlets, such as roadside stands, farmers

markets, or groceries will no longer have

to request an exemption from the Board

in order to avoid paying assessments

under the program. In addition,

producers would be required to keep

records for a period of two years just

like producer-packers, handlers, and

importers. The Board and the

Department need access to certain

industry records in order to enforce the

assessment and reporting provisions of

the program.

What Are the Statutory Requirements on

Continuance Referenda and

Evaluations?

The Act requires the Secretary of

Agriculture (Secretary) to conduct a

continuance referendum on the honey

program at least once every five years.

When the Act was amended in 1998, it

specified that continuance referenda be

held no more than once every two years.

Therefore this rule adds that limitation

on the frequency of continuance

referenda to the Order.

In 1996 [7 U.S.C. 7401], Congress

required all national research and

promotion boards to conduct

independent evaluations of their

programs at least once every five years.

This rule will simply include that

requirement in the Order.

What Happened to the Other Proposed

Amendments?

The other proposed amendments

(votable amendments) did not receive

enough support from the industry in the

September 2000 referendum. Therefore,

they are not being implemented at this

time. However, the amended Act

authorizes the Secretary to conduct

rulemaking and a referendum to

implement one or more of the votable

amendments at a later time, if

recommended by the Board or the

honey industry.

The votable amendments would have:

(1) Required the Board to reserve 8

percent of its funds annually for

beekeeping and production research; (2)

authorized the Board to develop

recommendations for purity standards

and an inspection and monitoring

system to enhance the image of honey

and honey products; (3) added two

handler-importer members and

alternates to the Board; (4) reduced the

producer assessment from 1 cent per

pound to 0.75 cents per pound; (5)

added a new assessment on handlers of

0.75 cents per pound on the domestic

honey that they handle; and (6)

increased the importer assessment from

1 cent per pound to 1.5 cents per pound

on imported honey and honey products.

Executive Orders 12866 and 12988

This rule has been determined to be

‘‘not significant’’ for purposes of

Executive Order (E.O.) 12866 and,

therefore, has not been reviewed by the

Office of Management and Budget.

In addition, this rule has been

reviewed under E.O. 12988, Civil Justice

Reform. The rule is not intended to have

retroactive effect and would not

preempt any State or local laws,

regulations, or policies, unless they

present an irreconcilable conflict with

this rule.

The Act allows producers, producerpackers, importers, and handlers (if

covered by the program) to file a written

petition with the Secretary of

Agriculture (Secretary) if they believe

that the Order, any provision of the

Order, or any obligation imposed in

connection with the Order is not in

accordance with law. In the petition, the

person may request a modification of

the Order or an exemption from the

Order. Petitions must be filed not later

than two years after: (1) The effective

date of the Order, provision, or

obligation challenged in the petition; or

(2) the date on which the petitioner

became subject to the Order, provision,

or obligation challenged in the petition.

The petitioner will have the opportunity

for a hearing on the petition.

Afterwards, the Secretary will issue a

ruling on the petition.

If the petitioner disagrees with the

Secretary’s ruling, the petitioner may

file, within 20 days, an appeal in the

U.S. District Court for the district where

the petitioner resides or conducts

business.

Regulatory Flexibility Act and

Paperwork Reduction Act

Regulatory Flexibility Analysis. In

accordance with the Regulatory

Flexibility Act (RFA) (5 U.S.C. 601 et

seq.), the Agricultural Marketing Service

(AMS) has examined the impact of

changes to the honey program on small

honey producers, producer-packers, and

importers. The final regulatory

flexibility analysis was included in the

proposed rule that was published in the

Federal Register on August 7, 2000.

However, that analysis included the

impact of both the votable and nonvotable amendments to the Order. This

rule will implement only the nonvotable amendments because the

votable amendments were not approved

in the September 2000 referendum.

Accordingly, the applicable analysis is

as follows.

The Small Business Administration

(SBA) (13 CFR 121.201) defines small

agricultural producers as those having

annual receipts of no more than

$500,000. Small producer-packers,

handlers, and importers fit into the SBA

definition for small agricultural service

firms with annual receipts of less than

$5 million.

According to National Honey Board

(Board) records, 2,885 producers paid

$1,864,590 in assessments in 1999. That

represents $646 in assessments on

64,600 pounds of honey per producer.

At the average wholesale price for

honey in 1999 of 65.5 cents per pound,

the average producer had $42,313 in

receipts, well below the $500,000

threshold.

Similarly, Board records indicate that

348 importers paid $1,743,021 in

assessments in 1999. That represents

$5,008 in assessments on 500,800

pounds of honey per importer. At the

average wholesale price for honey of

65.5 cents per pound, the average

importer had $328,024 in receipts, well

below the $5 million threshold.

Therefore, a majority of the producers,

producer-packers, handlers, and

importers who would be affected by the

changes to the Order may be considered

small entities. In addition, an estimated

three handler-importer organizations

whose membership includes these

entities would be affected by the

changes to the Order.

The changes in the nomination

procedures for Board members would

benefit handlers, importers, and

marketing cooperatives by giving them

increased input on the individuals who

are nominated by the National Honey

Nominations Committee (Committee).

The new eligibility requirements for

persons serving as importer members

and alternates on the Board and the

elimination of the authority for an

exporter to serve in an importer position

on the Board will also benefit importers

by providing them more representation

on the Board and, thus, more input into

Board decisions on how their

assessment dollars are spent.

The change in the term of office for

Committee members will greatly

facilitate the ability of state beekeeper

associations to submit nominees to

21826 Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations

serve on the Committee to USDA in a

timely manner and help assure that the

Secretary is able to appoint new

members to the Committee prior to the

beginning of the term of office. The new

requirement that 50 percent of the

members of the Board must be

producers reflects the amended

provisions of the Act.

In addition, producers, handlers, and

importers would benefit from the

changes on reconstituting the Board.

Reconstitution of Board members will

be based on changes in the geographical

distribution of honey production in the

United States and on changes in the

proportion of assessments paid on

domestic honey and on imported honey

and honey products, and this should

provide more equitable treatment and

fairness of representation on the Board

for producers, handlers, and importers

alike.

All segments of the honey industry

could benefit from the implementation

of a quality assurance program and a

related inspection and monitoring

system because they have the potential

to increase wholesale and retail

confidence in the quality of the honey

that is marketed. This means that

consumers, food service operators, and

manufacturers would be likely to have

more confidence in the quality of honey

and honey products available on the

market. This, in turn, is expected to

generate increased sales of honey in the

United States and abroad, which would

benefit producers, handlers, and

importers alike. Handlers would also

have confidence in the purity of the

honey they are buying from producers

or importers.

Adding reporting and recordkeeping

requirements for producers will assist

the Board in periodically collecting

production information to help identify

industry trends for use in program

planning and evaluation. This

information will help guide the Board in

its decision making as well as be

provided to industry members for their

use in making individual marketing

decisions. The amendment will also

assist the Board in enforcing the

assessment and reporting provisions of

the Order which is expected to help

ensure that everyone who is subject to

assessments is paying assessments.

Elimination of the requirement for

persons who are eligible to claim an

exemption to file an application for an

application will significantly reduce the

paperwork burden on the industry as

well as reduce the Board’s costs in

managing the program.

The new statutory guideline for the

timing of referenda reduces the

possibility that the operations of the

Board will be disrupted so frequently

that the effectiveness of the Board’s

programs would be compromised.

In addition, removing obsolete

provisions from the Order and rewriting

other provisions will make the Order

more understandable to the public, the

industry, and the Board and its staff.

We have also revised the paperwork

and recordkeeping impact as described

in the August 7, 2000, by eliminating

references and information relating to

the votable amendments that will not be

implemented as a result of this final

rule. Therefore, the remaining

paperwork and recordkeeping impact is

described below.

One amendment requires producers to

maintain and make available to the

Board and the Secretary books and

records. Another requires producers to

periodically report to the Board

information pertaining to the quantity of

honey produced and the total number of

bee colonies maintained. Currently,

only handlers, importers, and producerpackers are required to maintain records

and provide reports to the Board or the

Secretary. This information is necessary

for enforcement of the Act. It is most

likely that the information requested

from producers would be obtained

through periodic audits.

Based on this expanded reporting

authority, there are also plans to collect

production information periodically

from producers. At this time, the

Board’s plans are tentative on how and

when producers are to report the

prescribed information due to mailing

costs and certain other factors relating to

the content and design of the

information collection. The form or

mailer for collecting the information

will be submitted to OMB for approval

prior to its use, and the industry will be

notified.

The reporting burden for certain

producers, producer-packers, handlers,

and importers who qualify for

exemption from assessment based on

the quantity of honey or honey products

produced, handled, or imported will be

eliminated. Pursuant to the 1998

changes to the Act, the Order will no

longer require individuals to file an

application with the Board in order to

attain exempt status.

The recordkeeping and reporting

requirements related to the amendments

to the Order are designed to minimize

the burden on producers, producerpackers, handlers, and importers. In

addition, any information collection

that cannot occur through forms already

in use will pose a minimal additional

burden.

The estimated total annual cost of

maintaining records and providing the

information to the Board and USDA by

an estimated 5,043 respondents would

be $25,245 annually. The 5,043

respondents are as follows: 5,024

producers, 7 handlers, 7 importers, 2

cooperative representatives, and 3

organizations. The total cost for

producers is $25,120 or $5.00 per

producer per response. The total cost for

handlers is $35 or $5.00 per handler.

The total cost for importers is $35 or $5

per importer. The total cost for

cooperative representatives is $10 or $5

per cooperative representative. The total

cost for organizations is $45 or $15 per

organization.

The impact of the recordkeeping

requirement provided for in this rule on

small entities will be minimal. This

recordkeeping requirement is consistent

with prudent business practices and is

not expected to impose any undue costs

or significant burdens on a vast majority

of the small entities affected. It is

anticipated that a significant number of

these small entities currently keep these

records for commercial and/or tax

purposes.

The forms to be modified will 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, as well

as the amendments to the Order. The

information required has been designed

to coincide with normal industry

business practices to minimize the

burden on the industry.

With regard to alternatives, the

provisions of the amendments to the

Order in this rule have been carefully

reviewed, and every effort has been

made to minimize any unnecessary

costs or requirements while maintaining

consistency with the provisions of the

Act, as amended.

There are no federal rules that

duplicate, overlap, or conflict with this

rule.

Paperwork Reduction Act. In

accordance with the OMB regulation [5

CFR part 1320] which implements the

Paperwork Reduction Act of 1995 [44

U.S.C. Chapter 35], the information

collection and recordkeeping

requirements that are imposed by this

rule have been approved by OMB under

OMB Control Nos. 0581–0093 and

0505–0001.

This information differs from what

was published in the August 7, 2000,

proposed rule because the August 7,

2000, proposed rule included the

burden associated with amendments

that will not be implemented by this

final rule. Following are the increases

and decreases in burden that will

become effective with this final rule.

Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations 21827

Title: National Research, Promotion,

and Consumer Information Programs.

OMB Number: 0581–0093. Expiration

Date of Approval: March 31, 2001.

OMB Number: 0505–0001. Expiration

Date of Approval: July 31, 2002.

Type of Request: Revision of currently

approved information collections for

advisory committees and boards and for

research and promotion programs.

Abstract: The recordkeeping and

information collection requirements are

essential to carry out the intent of the

Act, as amended.

Producer recordkeeping and reporting

(increase under OMB No. 0581–0093).

The Order currently requires handlers,

importers, and producer-packers to

retain their books and records for at

least two years beyond the marketing

year of their applicability. This rule

changes the Order to conform to the Act,

as amended, by also requiring producers

to maintain and retain books and

records for two years. It is anticipated

that producers already maintain and

retain the books and records which

contain this information for commercial

and/or tax purposes. Therefore, this

recordkeeping requirement is consistent

with prudent business practices and is

not expected to impose any undue costs

or significant burdens on a vast majority

of producers.

In addition, the Board will have the

authority to require producers to report

information pertaining to the quantity of

honey produced and the total number of

bee colonies maintained. Currently, the

Board’s authority to request reports

extends only to handlers, importers, and

producer-packers. It is most likely that

this information will be obtained from

producers through periodic audits.

Based on this expanded reporting

authority, the Board also plans to collect

the quantity of honey produced and

number of bee colonies maintained

periodically from producers. At this

time, the Board’s plans are tentative on

how and when producers are to report

this information due to mailing costs

and certain other factors relating to the

content and design of the possible

information collection.

Candidate Profile form (increase

under OMB No. 0581–0093). This rule

also revises qualification requirements

for serving on the Board. This

information will be collected on the

Board’s Candidate Profile form and be

used by the Board’s staff and the

Committee to determine the

qualifications of candidates. It is

anticipated that the basic background

information to be collected would be

readily accessible or otherwise obtained

from records currently maintained by

those persons who would be candidates

to serve on the Board.

Nominee background form (decrease

under OMB No. 0505–0001 and increase

under OMB No. 0581–0093). Currently,

nominees for positions on the Board or

the Committee must submit a copy of a

USDA background form (AD–755) under

OMB No. 0505–0001 to the Secretary. In

the future, nominees will be required to

submit a copy of an AMS background

form (AMS–755) under OMB No. 0581–

0093. The information collected on the

two forms is identical.

Report by honey handler and importer

organizations and national honey

marketing cooperatives (increase under

OMB No. 0581–0093). This rule will

allow handler and importer

organizations and national honey

marketing cooperatives to submit the

names of handlers, importers, and

cooperative representatives,

respectively, to the Committee for

nomination to the Board. However, the

organizations must submit information

in a report to the Secretary in order to

be certified as eligible to submit the

names.

In addition to increasing the burden

under OMB No. 0581–0093, this rule

also decreases the burden by 41.5 hours

because it removes the requirement for

producers, producer-packers, and

importers to file an application with the

Board in order to qualify for exemption

from assessments.

The provisions of the amendments to

the Order in this rule have been

carefully reviewed, and every effort has

been made to minimize any unnecessary

recordkeeping or reporting costs or

requirements.

Under this rule, the information

required has been designed to coincide

with normal industry business practices

to minimize the burden on the industry.

The information sought is not available

from other sources because such

information relates specifically to

persons covered by the Act and Order.

Therefore, there is no practical method

for collecting the required information

without the proposed recordkeeping

requirements and use of forms described

in this rule.

The estimated total annual cost of

maintaining records and providing the

information to the Board and USDA by

an estimated 5,043 respondents would

be $25,245 annually. The 5,043

respondents are as follows: 5,024

producers, 7 handlers, 7 importers, 2

cooperative representatives, and 3

organizations. The total cost for

producers is $25,120 or $5.00 per

producer per response. The total cost for

handlers is $35 or $5.00 per handler.

The total cost for importers is $35 or $5

per importer. The total cost for

cooperative representatives is $10 or $5

per cooperative representative. The total

cost for organizations is $45 or $15 per

organization.

(1) PRODUCER RECORDKEEPING

AND REPORTING (NEW BURDEN

UNDER OMB No. 0581–0093).

Estimate of Burden: Public

recordkeeping burden for keeping this

information is estimated to average 0.5

hours per recordkeeper maintaining

such records.

Respondents (Recordkeepers):

Producers and producer-packers (in

their capacity as producers).

Estimated Number of Respondents

(Recordkeepers): 5,000.

Estimated Number of Responses per

Respondent (Recordkeeper): 1.

Estimated Total Annual Burden on

Respondents (Recordkeepers): 2,500

hours.

(2) CANDIDATE PROFILE (NEW

BURDEN UNDER OMB No. 0581–0093). 

Estimate of Burden: Public reporting

burden for this collection of information

from candidates to the Board is

estimated to average 0.50 hours per

response.

Respondents: 15 Producers, 4

handlers, 4 importers, and 1 cooperative

representative.

Estimated Number of Respondents:

24.

Estimated Number of Responses per

Respondent: 1.

Estimated Total Annual Burden on

Respondents: 12 hours.

(3) BACKGROUND INFORMATION

FORM (DECREASE UNDER OMB No.

0505–001 AND NEW BURDEN UNDER

OMB No. 0581–0093).

Estimate of Burden: Public reporting

burden for the collection of information

from two nominees for each of the

estimated four number and four

alternate position openings annually is

estimated to average 0.5 hours per

response.

Respondents: 9 producers, 3 handlers,

3 importers, and 1 cooperative

representative.

Estimated Number of Respondents:

16.

Estimated Number of Responses per

Respondent: 1.

Estimated Total Annual Burden on

Respondents: 8 hours.

(4) A REPORT FROM HONEY

HANDLER AND IMPORTER

ORGANIZATIONS AND NATIONAL

HONEY MARKETING COOPERATIVES

(NEW BURDEN UNDER OMB No. 0581–

0093).

Estimate of Burden: Public reporting

burden for this collection of information

is estimated to average 1.5 hours per

response for each organization.

21828 Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations

Respondents: Honey handler and

importer organizations.

Estimated Number of Respondents: 3.

Estimated Number of Responses per

Respondent: 1.

Estimated Total Annual Burden on

Respondents: 4.5 hours.

Comments on the regulatory and

paperwork impact of the amendments to

the Order were invited in the February

28, 2000, proposed rule. Three

comments were submitted by the April

28, 2000, deadline, and were discussed

in the August 7, 2000, proposed rule on

these amendments.

Background

As explained above, the Act, which

authorizes the honey research and

promotion program, was amended in

1998. Subsequently, the U.S.

Department of Agriculture (USDA or the

Department) requested interested

persons to submit proposals for making

comparable changes to the program,

which operates under the Honey

Research, Promotion, and Consumer

Information (Order).

The National Honey Board (Board)—

with the support of three honey

industry groups—submitted a proposal

containing regulatory text for all of the

changes authorized or required by the

1998 amendments to the Act. Proposals

submitted by eight other organizations

or persons did not include regulatory

text. Therefore, the Department

published the Board’s proposal, with a

few changes, as a proposed rule in the

Federal Register on February 28, 2000

(65 FR 10600), with a 60-day comment

period. The eight other submissions

were made part of the rulemaking

record and are considered comments on

the proposed changes.

A total of 30 comments were received

on the proposed amendments. These

included the original eight comments

that were received in response to

USDA’s request for proposals in 1999,

some of which were resubmitted by the

commenter. Seventeen commenters

supported the amendments, 12

commenters opposed one or more of the

amendments, and one commenter

merely expressed an opinion on the

direction the Board should take. As

discussed in the August 7, 2000, rule,

some changes were made to the

proposed amendments as a result of

comments received.

USDA held a national referendum on

the votable amendments from

September 5 through 29, 2000. In the

referendum, only 30.33 percent of the

voters, who represented 51.26 percent of

the pounds of honey produced,

handled, and imported by the voters in

the referendum, approved the votable

amendments. Therefore, only the nonvotable amendments will be made

effective by this final rule. In order to

implement only the non-votable

amendments, it has been necessary to

delete language related to the votable

amendments and to rewrite some

paragraphs as a result of the deletions.

Some renumbering of sections and

paragraphs has also occurred.

This rule will amend the Order by: (1)

Changing the size and composition of

the Board; (2) changing nomination and

eligibility requirements for handlers,

importers, and representatives of

cooperatives on the Board; (3) changing

the term of office for members of the

Board and the National Honey

Nominations Committee (Committee);

(4) authorizing the Board to develop a

voluntary quality assurance program; (5)

removing the requirement for small

companies to file for an exemption

under the program in order to avoid

paying assessments; (6) requiring

producers to provide reports and

maintain records; and (7) adding

statutory requirements for continuance

referenda and evaluations.

The amendments that appeared in the

August 7, 2000, proposed rule that will

not be made by this rule are: (1) A

requirement for the Board to reserve 8

percent of its funds annually for

beekeeping and production research; (2)

authorization for the Board to develop

recommendations for purity standards

and an inspection and monitoring

system to enhance the image of honey

and honey products; (3) the addition of

two handler-importer members and

alternates to the Board; (4) a reduction

in the producer assessment from 1 cent

per pound to 0.75 cents per pound; (5)

a new assessment on handlers of 0.75

cents per pound on the domestic honey

that they handle; and (6) an increase in

the importer assessment from 1 cent per

pound to 1.5 cents per pound on

imported honey and honey products.

Board size and composition. The

Board is currently composed of seven

producers, two importers (or one

importer and one exporter), two

handlers, one representative of a

cooperative, one public member, and

their alternates.

This rule will change the importerexporter position on the Board to

another importer position to provide

more importer input into Board

deliberations. In addition, the public

member position will be eliminated,

and at least 50 percent of the Board

members will have to be producers.

Also, this rule will add a new section

to the Order to provide for

reconstitution of the Board every five

years. The new section provides

procedures for making changes in the

boundaries of the domestic producer

regions and for adding importer

members if warranted. The

representation of importers will not

change unless the proportion of

assessments owed by importers

compared with the proportion of

assessments owed by producers on

domestic honey changes by more than 6

percent from the proportions

determined by the Board for its 1996

fiscal period. The first review is

required before the next continuance

referendum on the program, which will

be held in 2001.

Nominating and eligibility

requirements. This rule will also change

some of the nomination procedures

under the Order. Currently, handlers,

importers, and others submit the names

of handlers and importers to the

Committee for consideration as the

official nominees to serve on the Board

as handler members and alternates. This

rule will allow handler and importer

organizations to be certified to submit

the names of handlers and importers to

the Committee as well. In addition,

national honey marketing cooperatives

will be allowed to submit names to the

Committee for consideration as the

official nominees for the cooperative

representative and alternate on the

Board.

This rule also adds a new eligibility

requirement for importer members and

alternates. In order to be eligible to serve

in these positions, importers must

receive at least 75 percent of their gross

honey business income from the sale of

imported honey and honey products

during any three of the preceding five

years. Previously, any person who

imported any amount of honey was

eligible to serve on the Board as an

importer member or alternate.

Terms of office. In addition, this rule

will change the beginning of the term of

office for Committee members from

January 1 to July 1. This will facilitate

more timely nomination and

appointment of new members.

Also, the amended Act authorized the

Secretary to stagger the terms of office

of Board members periodically to help

ensure continuity of Board membership.

For example, currently the term of office

for the producer members and alternates

from four of the seven producer regions

end on December 31, 2001. This means

that over 50 percent of the producer

members on the Board could change in

one year. This is not desirable.

Therefore, the Secretary will work with

the Board and the Committee to

determine which of the regional

producer positions should have a

different term of office.

Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations 21829

Voluntary quality assurance program.

After this rule is implemented the Board

may develop rules and regulations for a

voluntary quality assurance program for

review by USDA. The voluntary quality

assurance program may include the

establishment of an official Board seal of

approval to be displayed on honey and

honey products or producers, handlers,

and importers that participate in the

voluntary program and are found to

meet such standards of purity as are

established under the program. It may

also include actions to encourage the

honey industry to participate in the

program and to encourage consumers to

purchase honey and honey products

that bear the official seal of approval. In

addition, the Department or other

parties approved by the Department

may perform periodic inspections of the

participants in the voluntary program.

Before a voluntary quality assurance

program will be implemented, USDA

will issue the proposed rules and

regulations relating to the program for

public comment.

Exemptions, reports, and

recordkeeping. Producers, producerpackers, and importers who sell (1) less

than 6,000 pounds of honey annually

and (2) the honey is sold through local

retail outlets, such as roadside stands,

farmers markets, or groceries will no

longer have to request an exemption

from the Board in order to avoid paying

assessments under the program. In

addition, producers would be required

to keep records for a period of two years

just like producer-packers, handlers,

and importers. The Board and the

Department need access to certain

industry records in order to enforce the

assessment and reporting provisions of

the program.

Continuance referenda. The Act

requires the Secretary of Agriculture to

conduct a continuance referendum on

the honey program at least once every

five years. When the Act was amended

in 1998, it specified that continuance

referenda be held no more than once

every two years. Therefore, this rule

adds the limitation on the frequency of

continuance referenda to the Order.

Evaluations. This rule also includes a

requirement for the Board to conduct an

independent evaluation of the

effectiveness of its programs at least

once every five years. The requirement

was imposed by Congress on all

national research and promotion

programs in 1996.

Miscellaneous changes. Finally, this

rule removes obsolete and genderspecific language from the Order and

makes a number of changes for syntax

and for clarity. Most of these changes

were in the August 7, 2000, proposed

rule. Additional changes made by this

rule include removing gender-specific

language from §§ 1240.34(b), 1240.38(j),

and 1240.62(a), expanding § 1240.5

Department to read Department or

USDA, and adding the tenure limitation

for Committee members back into

paragraph (a)(3) of § 1240.32.

List of Subjects in 7 CFR Part 1240

Administrative practice and

procedure, Advertising, Consumer

information, Marketing agreements,

Honey promotion, Reporting and

recordkeeping requirements.

For the reasons set forth in the

preamble, 7 CFR part 1240 is amended

as follows:

PART 1240—HONEY RESEARCH,

PROMOTION, AND CONSUMER

INFORMATION

1. Revise the authority citation for

part 1240 to read as follows:

Authority: 7 U.S.C. 4601–4613; 7 U.S.C.

7401.

2. Revise the heading of part 1240 to

read as set forth above.

3. Add a heading for a new subpart A,

consisting of §§ 1240.1 through 1240.67,

to read as follows:

Subpart A—Honey Research,

Promotion, and Consumer Information

Order

4. Remove § 1240.43.

4a. Redesignate §§ 1240.1 through

1240.14, 1240.16 through 1240.22, and

1240.44 as follows:

Old section New section

1240.1 ....................................... 1240.26

1240.2 ....................................... 1240.1

1240.3 ....................................... 1240.18

1240.4 ....................................... 1240.10

1240.5 ....................................... 1240.12

1240.6 ....................................... 1240.20

1240.7 ....................................... 1240.8

1240.8 ....................................... 1240.9

1240.9 ....................................... 1240.21

1240.10 ..................................... 1240.13

1240.11 ..................................... 1240.6

1240.12 ..................................... 1240.22

1240.13 ..................................... 1240.25

1240.14 ..................................... 1240.4

1240.16 ..................................... 1240.3

1240.17 ..................................... 1240.28

1240.18 ..................................... 1240.2

1240.19 ..................................... 1240.27

1240.20 ..................................... 1240.7

1240.21 ..................................... 1240.19

1240.22 ..................................... 1240.17

1240.44 ..................................... 1240.43

5. Revise newly designated § 1240.2 to

read as follows:

§ 1240.2 Board.

Board or National Honey Board

means Honey Board, the administrative

body established pursuant to § 1240.30.

6. Revise newly designated § 1240.3 to

read as follows:

§ 1240.3 Committee.

Committee means the National Honey

Nominations Committee established

pursuant to § 1240.32.

7. Add a new § 1240.5 to read as

follows:

§ 1240.5 Department or USDA.

Department or USDA means the

United States Department of

Agriculture.

8. Revise newly designated § 1240.8 to

read as follows:

§ 1240.8 Handle.

Handle means to process, package,

sell, transport, purchase or in any other

way place honey or honey products, or

cause them to be placed, in the current

of commerce. This term shall include

selling unprocessed honey that will be

consumed without further processing or

packaging. This term shall not include

the transportation of unprocessed honey

by a producer to a handler or

transportation by a commercial carrier

of honey, whether processed or

unprocessed, for the account of the

handler or producer. This term shall not

include the purchase of honey or a

honey product by a consumer or other

end-user of the honey or honey product.

9. Revise newly designated § 1240.10

to read as follows:

§ 1240.10 Honey.

Honey means the nectar and

saccharine exudations of plants which

are gathered, modified, and stored in the

comb by honey bees, including comb

honey.

10. Add a new § 1240.11 to read as

follows:

§ 1240.11 Honey production.

Honey production means all

beekeeping operations related to

managing honey bee colonies to

produce honey, harvesting honey from

the colonies, extracting honey from the

honeycombs, and preparing honey for

sale and further processing.

11. Revise newly designated § 1240.13

to read as follows:

§ 1240.13 Importer.

Importer means any person who

imports honey or honey products into

the United States as principal or as an

agent, broker, or consignee for any

person who produces honey or honey

products outside of the United States for

sale in the United States, and who is

21830 Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations

listed in the import records as the

importer of record for such honey or

honey products.

12. Add a new § 1240.14 to read as

follows:

§ 1240.14 Industry information.

Industry information means

information or a program that will lead

to the development of new domestic

and foreign markets, new marketing

strategies, or increased efficiency for the

honey industry, or an activity to

enhance the image of honey and honey

products and of the honey industry.

13. Add a new § 1240.16 to read as

follows:

§ 1240.16 National honey marketing

cooperative.

National honey marketing cooperative

means a cooperative that markets its

products in at least two of the following

four regions of the United States, as

determined by the Secretary:

(a) The Atlantic Coast, including the

District of Columbia and the

Commonwealth of Puerto Rico;

(b) The Mideast;

(c) The Midwest; and

(d) The Pacific, including the states of

Alaska and Hawaii.

14. Revise newly designated § 1240.19

to read as follows:

§ 1240.19 Plans and projects.

Plans and projects means those

research, promotion, industry

information, and consumer education

plans, studies, or projects established

pursuant to §§ 1240.38 and 1240.39.

15. Add a new § 1240.23 to read as

follows:

§ 1240.23 Qualified national organization

representing handler interests.

Qualified national organization

representing handler interests means an

organization that the Secretary certifies

as being eligible to recommend

nominations to the Committee for

handler and alternate handler members

of the Board under § 1240.32.

16. Add a new § 1240.24 to read as

follows:

§ 1240.24 Qualified national organization

representing importer interests.

Qualified national organization

representing importer interests means

an organization that the Secretary

certifies as being eligible to recommend

nominations to the Committee for

importer and alternate importer

members of the Board under § 1240.32.

17. Revise newly designated § 1240.25

to read as follows:

§ 1240.25 Research.

Research means any type of

systematic study or investigation,

including studies testing the

effectiveness of market development

and promotion efforts, and/or the

evaluation of any study or investigation

designed to advance the image,

desirability, usage, marketability,

production, or quality of honey or

honey products. Such term shall also

include studies on bees to advance the

cost effectiveness, competitiveness,

efficiency, pest and disease control, and

other management aspects of

beekeeping, honey production, and

honey bees.

18. Revise § 1240.30 to read as

follows:

§ 1240.30 Establishment and membership.

A Honey Board is established to

administer the terms and provisions of

this part. The Board shall consist of

twelve (12) members, each of whom

shall have an alternate. Seven members

and seven alternates shall be honey

producers; two members and two

alternates shall be honey handlers; two

members and two alternates shall be

honey importers; and one member and

one alternate shall be an officer,

director, or employee of a national

honey marketing cooperative. The Board

shall be appointed by the Secretary from

nominations submitted by the

Committee, pursuant to § 1240.32.

Notwithstanding any other provision of

this part, at least 50 percent of the

members of the Board shall be honey

producers.

19. Revise § 1240.31 to read as

follows:

§ 1240.31 Term of office.

The members of the Board and their

alternates shall serve for terms of three

years, except that terms may be

staggered periodically as recommended

by the Board and as determined by the

Secretary or as determined by the

Secretary alone. No member or alternate

shall serve more than two consecutive

three-year terms. The term of office shall

begin on April 1. Each Board member

and alternate member shall continue to

serve until the member’s or alternate’s

successor meets all qualifications and is

appointed by the Secretary.

20. Amend § 1240.32 as follows:

a. By revising paragraphs (a)(1) and

(a)(3), and (b)(1) and (b)(2) respectively;

b. Removing paragraph (b)(6);

c. Redesignating paragraphs (b)(7) and

(b)(8) as (b)(6) and (b)(7) respectively;

d. Revising newly designated

paragraphs (b)(6) and (b)(7); and

e. Adding paragraphs (b)(8), (b)(9),

(b)(10), (b)(11), and (b)(12).

The revisions and additions to

§ 1240.32 read as follows:

§ 1240.32 Nominations.

* * * * *

(a) * * *

(1) There is established a National

Honey Nominations Committee, which

shall consist of not more than one

member from each State, appointed by

the Secretary from nominations

submitted by each State beekeeper

association. Wherever there is more

than one eligible association within a

State, the Secretary shall designate the

association most representative of the

honey producers, handlers, and

importers not exempt under § 1240.42

(a) and (b) to make nominations for that

State.

* * * * *

(3) Members of the Committee shall

serve for three-year terms, except that

the term of appointments to the

Committee may be staggered

periodically, as determined by the

Secretary. No member shall serve more

than two consecutive three-year terms.

The term of office shall begin on July 1.

* * * * *

(b) * * *

(1) The Committee shall nominate the

members and alternate members of the

Board and submit such nominations

promptly to the Secretary for approval.

(2) The Committee shall meet

annually to make such nominations, or,

at the determination of the Chairperson,

the Committee may conduct its business

by mail ballot in lieu of an annual

meeting.

* * * * *

(6) In nominating producer members

to the Board, no producer-packer who,

during any three of the preceding five

years, purchased for resale more honey

than the producer-packer produced

shall be eligible for nomination or

appointment to the Board as a producer

or as an alternate to a producer.

(7) In nominating importer members

to the Board, no importer who, during

any three of the preceding five years,

did not receive at least 75 percent of the

gross income generated by the sale of

honey and honey products from the sale

of imported honey and honey products

shall be eligible for nomination or

appointment to the Board as an importer

or as an alternate to an importer.

(8) Six months before the new Board

term begins, the Committee shall submit

to the Secretary nominations for

positions on the Board. The number of

nominations will directly correspond to

the number of producer, handler,

importer, and cooperative member

positions due to become vacant.

Selection of nominees by the Committee

will be pursuant to the following:

Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations 21831

(i) Nominations for producer members

and alternate producer members will be

from the regions in which one or more

vacancies will occur;

(ii) Nominations for handler members

and alternate handler members will be

based on recommendations made by

qualified national organizations

representing handler interests, or, if the

Secretary determines that there is not a

qualified national organization

representing handler interests, by

individual handlers who have paid

assessments to the Board on honey or

honey products handled;

(iii) Nominations for importer

members and alternate importer

members will be based on

recommendations made by qualified

national organizations representing

importer interests, or, if the Secretary

determines that there is not a qualified

national organization representing

importer interests, by individual

importers who have paid assessments to

the Board on imported honey or honey

products; and

(iv) Nominations for a member and

alternate member who are officers,

directors, or employees of national

honey marketing cooperatives will be

based on recommendations made by

qualified national honey marketing

cooperatives.

(9) Qualified national organization

representing handler interests. To be

certified by the Secretary as a qualified

national organization representing

handler interests, an association or

organization must meet the following

criteria, as evidenced in a factual report

submitted by the association or

organization to the Secretary:

(i) The organization’s membership is

comprised primarily of honey handlers;

(ii) The organization represents a

substantial number of handlers who

handle a substantial volume of honey in

at least 20 states;

(iii) The organization has a history of

stability and permanency;

(iv) A primary or overriding purpose

of the organization is to promote the

economic welfare of honey handlers;

(v) A portion of the operating funds of

the organization are derived from

handlers; and

(vi) The organization demonstrates

the ability and willingness to further the

purposes of the Act.

(10) Qualified national organization

representing importer interests. To be

certified as a qualified national

organization representing importer

interests, an association or organization

must meet the following criteria, as

evidenced in a factual report submitted

by the association or organization to the

Secretary:

(i) The organization’s total paid

membership is comprised of a

significant number of importers or the

organization’s total paid membership

represents at least a majority of the

volume of honey imported into the

United States;

(ii) The organization has a history of

stability and permanency;

(iii) A primary or overriding purpose

of the organization is to promote the

economic welfare of honey importers;

(iv) Substantial geographic territory is

covered by the active membership of the

organization;

(v) A portion of the operating funds of

the organization are derived from

importers; and

(vi) The organization demonstrates

the ability and willingness to further the

purposes of the Act.

(11) As a condition of certification by

the Secretary as a qualified national

organization representing handler or

importer interests, an organization shall

agree to:

(i) Notify handlers and importers who

are not members of the organization of

Board nomination opportunities for

which the organization is certified to

make recommendations to the

Committee; and

(ii) Consider the nomination of

handlers and importers who are not

members when making the nominations

of the organization to the Committee, if

nonmembers indicate an interest in

serving on the Board.

(12) A certification determination by

the Secretary of a qualified organization

representing handler or importer

interests shall be final.

21. Add a new § 1240.33 to read as

follows:

§ 1240.33. Board reconstitution.

(a) Every five years, the Board shall

review the geographic distribution of

the quantities of domestically produced

honey assessed under this subpart and

the changes in the annual average

percentage of assessments owed by

importers under this subpart relative to

assessments owed by producers of

domestic honey. The Board shall

conduct the initial review required by

this paragraph prior to the first

continuance referendum conducted

after May 31, 2001.

(b)(1) If warranted as a result of this

review, the Board shall recommend for

the Secretary’s approval:

(i) Changes in the regional

representation of honey producers; and/

or

(ii) The addition of Board members.

(2) If such allocations are necessary to

reflect changes in the proportion of

domestic and imported honey assessed

under this subpart or the source of

assessments on imported honey or

honey products, the Board may not

recommend the addition of members

pursuant to paragraph (b)(1)(ii) of this

section unless the proportion of

assessments owed by importers

compared with the proportion of

assessments owed on domestic honey

by producers changed by more than 6

percent from the base period proportion

determined in accordance with

paragraph (d) of this section.

(c) Except as provided in paragraph

(d) of this section, recommendations

made under paragraph (b) of this section

shall be based on the 5-year average

annual assessments, excluding the 2

years containing the highest and lowest

disparity between the proportion of

assessments owed from imported and

domestic honey or honey products,

determined pursuant to the review that

is conducted under paragraph (a) of this

section.

(d) The base period proportions for

determining the magnitude of change

under paragraph (c) of this section shall

be the proportions determined during

the prior review conducted under this

section. In the case of the initial review,

the base period proportions shall be the

proportions determined by the Board for

fiscal period 1996.

(e) Notwithstanding any other

provision of this section, at least 50

percent of the members of the Board

shall be honey producers.

(f) Any such reallocation or addition

of members shall be made at least six

months prior to the date on which terms

of office of the Board begin each year

and shall become effective at least 30

days prior to such date.

22. Amend § 1240.34 as follows:

a. By revising paragraphs (a) and (b);

and

b. By removing ‘‘Honey Nominations

Committee and adding ‘‘Committee’’ in

its place in paragraph (c).

The revisions of paragraphs (a) and (b)

read as follows:

§ 1240.34 Vacancies.

(a) In the event any member of the

Board ceases to be a member of the

category of members from which the

member was appointed to the Board,

such position shall automatically

become vacant: Provided, That if, as a

result of Board reconstitution pursuant

to § 1240.33, a producer member or

alternate is no longer from the region

from which such person was appointed,

the affected member and/or alternate

may serve out the term for which such

person was appointed, or if a member,

whose position is based on the

member’s status as an importer is

21832 Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations

subject to reallocation by the Board, the

affected member and/or alternate may

serve out the term for which such

person was appointed.

(b) 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 engages in acts

of dishonesty or willful misconduct, the

Board may recommend to the Secretary

that the member be removed from office.

If the Secretary finds the

recommendation of the Board shows

adequate cause, the Secretary shall

remove such member from office.

* * * * *

23. Amend § 1240.35 by revising

paragraph (a) to read as follows:

§ 1240.35 Procedure.

(a) A majority of members, of which

at least 50 percent are producers,

including alternates acting in place of

members of the Board, shall constitute

a quorum: Provided, That such

alternates shall serve only whenever the

member is absent from a meeting or is

disqualified. Any action of the Board

shall require the concurring votes of a

majority of those present and voting. At

assembled meetings, all votes shall be

cast in person.

* * * * *

24. Amend § 1240.38 by revising

paragraphs (c), (d), (e), (j), (g),(k), (l) and

(m) to read as follows:

§ 1240.38 Duties.

* * * * *

(c) To prepare and submit to the

Secretary for approval 60 days in

advance of the beginning of a fiscal

period, a budget of its anticipated

expenses in the administration of this

part including the probable costs of all

programs and plans and to recommend

a rate of assessment with respect

thereto;

(d) To investigate violations of this

part and report the results of such

investigations to the Secretary for

appropriate action to enforce the

provisions of this part;

(e) To develop programs and plans

and to enter into contracts or

agreements with the approval of the

Secretary for the development and

carrying out of programs and plans of

research, promotion, advertising,

consumer education, or industry

information and the payment of the

costs thereof with funds collected

pursuant to this part;

* * * * *

(g) To periodically prepare and make

public and to make available to

producers, handlers, producer-packers,

and importers, reports of its activities

carried out and, at least once each fiscal

period, to make public an accounting of

funds received and expended;

* * * * *

(j) To submit to the Secretary such

information pertaining to this subpart as

the Secretary may request;

(k) To notify honey producers,

producer-packers, handlers, and

importers of all Board meetings through

press releases or other means.

(l) To appoint and convene, from time

to time, working committees which may

include producers, handlers, producerpackers, importers, exporters, members

of wholesale or retail outlets for honey,

or other members of the public to assist

in the development of research,

promotion, advertising, consumer

education, and industry information

programs for honey; and

(m) To develop and recommend such

rules and regulations to the Secretary for

approval as may be necessary for the

development and execution of plans or

activities to effectuate the declared

purpose of the Act.

25. Revise the heading preceding

§ 1240.39 to read as follows:

RESEARCH, PROMOTION,

CONSUMER EDUCATION, AND

INDUSTRY INFORMATION

26. Revise § 1240.39 to read as

follows:

§ 1240.39 Research, promotion, consumer

education, and industry information.

(a) Scope of activities. The Board shall

develop and submit to the Secretary for

approval any plans, programs, or

projects authorized in this section. Such

plans, programs, and projects shall

provide for:

(1) The establishment, issuance,

effectuation, and administration of

appropriate plans, programs, or projects

for consumer education, industry

information, advertising, and promotion

of honey and honey products designed

to strengthen the position of the honey

industry in the marketplace and to

maintain, develop, and expand markets

for honey and honey products;

(2) The establishment and conduct of

marketing research and development

plans to the end that the acquisition of

knowledge pertaining to honey and

honey products or their consumption

and use may be encouraged or

expanded, or to the end that the

marketing and utilization of honey and

honey products may be encouraged,

expanded, improved, or made more

efficient: Provided, That supply

management programs or other

programs that would otherwise limit the

right of the individual honey producer

to produce honey shall not be

conducted under, or as a part of, this

subpart;

(3) The development and expansion

of honey and honey product sales in

foreign markets;

(4) A prohibition on advertising or

other promotion programs that make

any false or unwarranted claims on

behalf of honey or its products or false

or unwarranted statements with respect

to the attributes or use of any competing

product;

(5) The sponsorship of research

designed to advance the costeffectiveness, competitiveness,

efficiency, pest and disease control, and

other management aspects of

beekeeping, honey production, and

honey bees;

(6) The conduct of activities which

may lead to the development of new

markets or marketing strategies for

honey or honey products. In addition,

the Board may conduct activities

designed to increase the efficiency of

the honey industry or activities to

enhance the image of honey and honey

products and the honey industry;

(7) Periodic evaluation by the Board

of each plan, program, or project

authorized under this part to insure that

each plan, program, or project

contributes to an effective and

coordinated program of research,

promotion, consumer education, and

industry information and submit such

evaluation to the Secretary. If the Board

or the Secretary finds that a plan,

program, or project does not further the

purposes of the Act, then the Board

shall terminate such plan, program, or

project; and

(8) The Board to enter into contracts

or make agreements for the development

and carrying out of research, promotion,

consumer education, and industry

information programs, and pay for the

costs of such contracts or agreements

with funds received by the Board.

(b) Independent evaluation. In

addition to any evaluation that may be

carried out pursuant to paragraph (a)(7)

of this section, the Board shall, not less

often than every five years, authorize

and fund, from funds otherwise

available to the Board, an independent

evaluation of the effectiveness of this

subpart and other plans, programs, and

projects conducted by the Board

pursuant to the Act. The Board shall

submit to the Secretary, and make

available to the public, the results of

each periodic independent evaluation

conducted under this paragraph.

27. Amend § 1240.40 by revising

paragraphs (a) and (b) to read as follows:

Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations 21833

§ 1240.40 Budget and expenses.

(a) Sixty days in advance of the

beginning of each fiscal period, or as

may be necessary thereafter, the Board

shall prepare and recommend a budget

on a fiscal period basis of its anticipated

expenses and disbursements in the

administration of this subpart, including

expenses of the Committee and probable

costs of research, promotion, consumer

education, and industry information.

(b) The Board is authorized to incur

expenses for: research, promotion,

consumer education, and industry

information; such other expenses for the

administration, maintenance, and

functioning of the Board and the

Committee as may be authorized by the

Secretary; any operating reserve

established pursuant to § 1240.43; and

those administrative costs incurred by

the Department specified in paragraph

(d) of this section. The funds to cover

such expenses shall be paid from

assessments collected pursuant to

§ 1240.41, donations from any person

not subject to assessments under this

subpart, and other funds available to the

Board including those collected

pursuant to § 1240.67 and subject to the

limitationscontained in that section.

* * * * *

28. Revise § 1240.41 to read as

follows:

§ 1240.41 Assessments.

(a) Domestic honey and honey

products. The assessment rate on honey

produced in the United States and

handled shall be 1 cent per pound of

honey produced.

(b) Imported honey and honey

products. The assessment rate on honey

or honey products imported into the

United States shall be 1 cent per pound

of honey or honey products imported.

The importer of imported honey and

honey products shall pay the

assessment to the Board through the

U.S. Customs Service at the time of

entry of such honey and honey products

into the United States. Should the U.S.

Customs Service fail to collect an

assessment from an importer, the

importer shall be responsible for the

payment of the assessment to the Board.

(c) General. (1) Except as provided in

§ 1240.42 and in paragraphs (c)(2) and

(e) of this section, the first handler shall

be responsible for the collection of such

assessment from the producer and

payment thereof to the Board. The first

handler shall maintain separate records

for each producer’s honey handled,

including honey produced by said

handler.

(2) Producer-packers shall pay to the

Board the assessment on all honey or

honey products for which they act as

first handler, in addition to the

assessment owed on honey they

produce.

(3) Should a first handler fail to

collect an assessment from a producer,

the producer shall be responsible for the

payment of the assessment to the Board.

(4) Assessments shall be paid to the

Board at such time and in such manner

as the Board, with the Secretary’s

approval, directs pursuant to this part.

Such regulations may provide for

different handler, importer, producer, or

producer-packer payment schedules so

as to recognize differences in marketing

or purchasing practices and procedures.

(d) Late payment. (1) There shall be a

late-payment charge imposed on any

importer, handler, or producer-packer

who fails to remit to the Board the total

amount for which any such importer,

producer, or producer-packer is liable

on or before the payment due date

established by the Board. The amount of

the late-payment charge shall be set by

the Board subject to approval by the

Secretary.

(2) There shall also be imposed on

any importer, handler, or producerpacker subject to a late-payment charge,

an additional charge in the form of

interest on the outstanding portion of

any amount for which the importer,

handler, or producer-packer is liable.

The rate of interest shall be prescribed

in regulations issued by the Secretary.

(3) Persons failing to remit total

assessments due in a timely manner

may also be subject to actions under

federal debt collection procedures.

(e) Honey under loan. Whenever a

loan is made on honey under an USDA

loan program, the Secretary shall

provide that the assessment be deducted

from the proceeds of the loan or the loan

deficiency payment, if applicable, and

that the amount of such assessment

shall be forwarded to the Board, except

that the assessment shall not be

deducted by the Secretary in the case of

a honey marketing cooperative

approved by the Department’s

Commodity Credit Corporation that

deducts the assessment from its member

producers. As soon as practicable after

the assessment is deducted from the

loan funds or loan deficiency payment,

the Secretary shall provide the producer

with proof of payment of the

assessment.

(f) Advance payment. The Board is

authorized to accept advance payment

of assessments by handlers, importers,

or producer-packers that shall be

credited toward any amount for which

the handlers, importers, or producerpackers may become liable. The Board

is not obligated to pay interest on any

advance payment.

29. Amend § 1240.42 as follows:

a. By revising paragraph (a);

b. By removing paragraphs (c) and (f);

c. By redesignating paragraphs (d) and

(e) as (c) and (d), respectively; and

d. By revising newly designated

paragraphs (c) and (d).

The revisions to § 1240.42 read as

follows:

§ 1240.42 Exemption from assessment.

(a) A producer who produces less

than 6,000 pounds of honey per year, a

producer-packer who produces and

handles less than 6,000 pounds of

honey or honey products per year, or an

importer who imports less than 6,000

pounds of honey or honey products per

year shall be exempt from assessment:

Provided, such honey or honey products

are distributed directly through local

retail outlets such as roadside stands,

farmers markets, groceries, or other

outlets as otherwise determined by the

Secretary during such year.

* * * * *

(c) If, after a person has been exempt

from paying assessments for any year

under this section, and such person no

longer meets the requirements of this

section for an exemption, such person

shall file a report with the Board in the

form and manner prescribed by the

Board and pay an assessment on or

before March 15 of the subsequent year

on all honey or honey products

produced or imported by such person

during the year for which the person

claimed the exemption.

(d) The Board may recommend to the

Secretary that honey exported from the

United States be exempted from the

provisions of this subpart and include

procedures for the refund of

assessments on such honey and such

safeguards as may be necessary to

prevent improper use of this exemption.

30. Add a new § 1240.44 to read as

follows:

§ 1240.44 Voluntary quality assurance

program.

(a) The Board is authorized to develop

and carry out a voluntary quality

assurance program concerning purity

standards for honey and honey

products. The Secretary shall have the

authority to approve or disapprove such

program.

(b) The program may include the

following components:

(1) The establishment of an official

Board seal of approval to be displayed

on honey and honey products which

meet such standards of purity as are

established under the program;

(2) Actions to encourage producers,

handlers, and importers to participate in

the program;

21834 Federal Register / Vol. 66, No. 84 / Tuesday, May 1, 2001 / Rules and Regulations

(3) Actions to encourage consumers to

purchase honey and honey products

bearing the official seal of approval; and

(4) Periodic inspections by the

Secretary, or other parties approved by

the Secretary, of honey and honey

products of persons who participate in

the program.

(c) To be eligible to display the

official seal of approval under paragraph

(b)(1) of this section on a honey or

honey product, a producer, handler, or

importer shall participate in the

voluntary program described in

paragraph (a) of this section.

31. Revise § 1240.50 to read as

follows:

§ 1240.50 Reports.

Each handler, importer, producer, or

producer-packer subject to this part

shall be required to report to the

employees of the Board, at such time

and in such manner as it may prescribe,

such information as may be necessary

for the Board to perform its duties. Such

reports shall include, but shall not be

limited to the following:

(a) For producers or producer-packers:

the quantity of honey produced and the

total number of bee colonies

maintained.

(b) For handlers and producerpackers: the total quantity of honey

acquired during the reporting period;

the total quantity of honey and honey

products handled during such period;

the amount of honey acquired from each

producer, giving the name and address

of each producer; the assessments

collected during the reporting period;

the quantity of honey processed for sale

from a producer-packer’s own

production; and a record of each

transaction for honey on which

assessments had already been paid,

including a statement from the seller

that the assessment had been paid.

(c) For importers: the total quantity of

honey and honey products imported

during the reporting period and a record

of each importation of honey or honey

products during such period, giving the

quantity, date, country of origin, and

port of entry.

(d) For persons who have an

exemption from assessments under

§ 1240.42(a) and (b), such information as

deemed necessary by the Board, and

approved by the Secretary, concerning

the exemption including disposition of

exempted honey.

32. Revise § 1240.51 to read as

follows:

§ 1240.51 Books and records.

Each handler, importer, producer,

producer-packer, or any person who is

exempt from assessments under this

subpart shall maintain and during

normal business hours make available

for inspection by employees or agents of

the Board or the Secretary, such books

and records as are necessary to carry out

the provisions of this part, including

such records as are necessary to verify

any required reports. A member or

alternate member of the Board is

prohibited from conducting such

inspections. Such books and records

shall be maintained for two years

beyond the fiscal period of their

applicability.

33. Revise § 1240.52 to read as

follows:

§ 1240.52 Confidential treatment.

All information obtained from the

books, records, or reports required to be

maintained under §§ 1240.50 and

1240.51 shall be kept confidential by all

employees and agents of the Board and

all officers and employees of the

Department and shall not be disclosed

to the public. Only such information as

the Secretary deems relevant shall be

disclosed to the public and then only in

a suit or administrative hearing brought

at the direction, or upon the request, of

the Secretary, or to which the Secretary

or any officer of the United States is a

party, and involving this subpart:

Except that nothing in this subpart shall

be deemed to prohibit:

(a) The issuance of general statements

based upon the reports of a number of

handlers or importers subject to this

subpart, if such statements do not

identify the information furnished by

any person;

(b) The publication by direction of the

Secretary of the name of any person

convicted of violating this subpart,

together with a statement of the

particular provisions of this subpart

violated by such person.

34. Revise § 1240.61 to read as

follows:

§ 1240.61 Right of the Secretary.

All fiscal matters, programs or plans,

rules or regulations, reports, or other

substantive actions proposed and

prepared by the Board shall be

submitted to the Secretary for approval.

35. Amend § 1240.62 as follows:

a. By removing ‘‘he/she’’ and adding

‘‘the Secretary’’ in its place in paragraph

(a);

b. By removing paragraph (c);

c. By redesignating paragraph (d) as

(c); and

d. By revising newly designated

paragraph (c).

The revisions to § 1240.62 read as

follows:

§ 1240.62 Suspension or termination.

* * * * *

(c) The Secretary shall hold a

referendum on the request of the Board,

or when petitioned by 10 percent or

more of the honey producers and

importers subject to assessment under

this subpart to determine if the honey

producers and importers favor

termination or suspension of this

subpart. A referendum under this

paragraph may not be held more than

once every two (2) years. If the Secretary

determines, through a referendum

conducted pursuant to this paragraph,

that continuation of this subpart is

approved, any referendum otherwise

required to be conducted under

paragraph (b) of this section shall not be

held less than five (5) years after the

date the referendum was conducted

under this paragraph.

Dated: April 23, 2001.

Kenneth C. Clayton,

Acting Administor, Agricultural Marketing

Service.

[FR Doc. 01–10602 Filed 4–30–01; 8:45 am]

BILLING CODE 3410–02–P