I
106TH CONGRESS
1ST SESSION
H. R. 3428
To provide for the modification and implementation of the final rule for
the consolidation and reform of Federal milk marketing orders, and
for other purposes.
IN THE HOUSE OF REPRESENTATIVES
NOVEMBER 17, 1999
Mr. BLUNT introduced the following bill; which was referred to the Committee
on Agriculture
A BILL
To provide for the modification and implementation of the
final rule for the consolidation and reform of Federal
milk marketing orders, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. USE OF OPTION 1A AS PRICE STRUCTURE FOR
CLASS I MILK UNDER CONSOLIDATED FED-
ERAL MILK MARKETING ORDERS.
(a) FINAL RULE DEFINED.—In this section, the term
‘‘final rule’’ means the final rule for the consolidation and
reform of Federal milk marketing orders that was pub-
lished in the Federal Register on September 1, 1999 (64
Fed. Reg. 47897–48021), to comply with section 143 of
the Federal Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7253).
(b) IMPLEMENTATION OF FINAL RULE FOR MILK
ORDER REFORM.—Subject to subsection (c), the final rule
shall take effect, and be implemented by the Secretary of
Agriculture, on the first day of the first month beginning
at least 30 days after the date of the enactment of this
Act.
(c) USE
OF OPTION 1A FOR PRICING CLASS I
MILK.—In lieu of the Class I price differentials specified
in the final rule, the Secretary of Agriculture shall price
fluid or Class I milk under the Federal milk marketing
orders using the Class I price differentials identified as
Option 1A ‘‘Location-Specific Differentials Analysis’’ in
the proposed rule published in the Federal Register on
January 30, 1998 (63 Fed. Reg. 4802, 4809), except that
the Secretary shall include the corrections and modifica-
tions to such Class I differentials made by the Secretary
through April 2, 1999.
(d) EFFECT OF PRIOR ANNOUNCEMENT OF MIN-
IMUM PRICES.—If the Secretary of Agriculture announces
minimum prices for milk under Federal milk marketing
orders pursuant to section 1000.50 of title 7, Code of Fed-
eral Regulations, before the effective date specified in sub-
section (b), the minimum prices so announced before that
date shall be the only applicable minimum prices under
Federal milk marketing orders for the month or months
for which the prices have been announced.
(e) IMPLEMENTATION OF REQUIREMENT.—The im-
plementation of the final rule, as modified by subsection
(c), shall not be subject to any of the following:
(1) The notice and hearing requirements of sec-
tion 8c(3) of the Agricultural Adjustment Act (7
U.S.C. 608c(3)), reenacted with amendments by the
Agricultural Marketing Agreement Act of 1937, or
the notice and comment provisions of section 553 of
title 5, United States Code.
(2) A referendum conducted by the Secretary of
Agriculture pursuant to subsections (17) or (19) of
section 8c of the Agricultural Adjustment Act (7
U.S.C. 608c), reenacted with amendments by the
Agricultural Marketing Agreement Act of 1937.
(3) The Statement of Policy of the Secretary of
Agriculture effective July 24, 1971 (36 Fed. Reg.
13804), relating to notices of proposed rulemaking
and public participation in rulemaking.
(4) Chapter 35 of title 44, United States Code
(commonly known as the Paperwork Reduction Act).
(5) Any decision, restraining order, or injunc-
tion issued by a United States court before the date
of the enactment of this Act.
SEC. 2. FURTHER RULEMAKING TO DEVELOP PRICING
METHODS FOR CLASS III AND CLASS IV MILK
UNDER MARKETING ORDERS.
(a) CONGRESSIONAL FINDING.—The Class III and
Class IV milk pricing formulas included in the final deci-
sion for the consolidation and reform of Federal milk mar-
keting orders, as published in the Federal Register on
April 2, 1999 (64 Fed. Reg. 16025), do not adequately
reflect public comment on the original proposed rule pub-
lished in the Federal Register on January 30, 1998 (63
Fed. Reg. 4802), and are sufficiently different from the
proposed rule and any comments submitted with regard
to the proposed rule that further emergency rulemaking
is merited.
(b) RULEMAKING REQUIRED.—The Secretary of Ag-
riculture shall conduct rulemaking, on the record after an
opportunity for an agency hearing, to reconsider the Class
III and Class IV milk pricing formulas included in the
final rule for the consolidation and reform of Federal milk
marketing orders that was published in the Federal Reg-
ister on September 1, 1999 (64 Fed. Reg. 47897–48021).
(c) TIME PERIOD FOR RULEMAKING.—On December
1, 2000, the Secretary of Agriculture shall publish in the
Federal Register a final decision on the Class III and
Class IV milk pricing formulas. The resulting formulas
shall take effect, and be implemented by the Secretary,
on January 1, 2001.
(d) EFFECT OF COURT ORDER.—The actions author-
ized by subsections (b) and (c) are intended to ensure the
timely publication and implementation of new pricing for-
mulas for Class III and Class IV milk. In the event that
the Secretary of Agriculture is enjoined or otherwise re-
strained by a court order from implementing a final deci-
sion within the time period specified in subsection (c), the
length of time for which that injunction or other restrain-
ing order is effective shall be added to the time limitations
specified in subsection (c) thereby extending those time
limitations by a period of time equal to the period of time
for which the injunction or other restraining order is effec-
tive.
(e) 
FAILURE
TO
TIMELY
COMPLETE
RULE-
MAKING.—If the Secretary of Agriculture fails to imple-
ment new Class III and Class IV milk pricing formulas
within the time period required under subsection (c) (plus
any additional period provided under subsection (d)), the
Secretary may not assess or collect assessments from milk
producers or handlers under section 8c of the Agricultural
Adjustment Act (7 U.S.C. 608c), reenacted with amend-
ments by the Agricultural Marketing Agreement Act of
1937, for marketing order administration and services
provided under such section after the end of that period
until the pricing formulas are implemented. The Secretary
may not reduce the level of services provided under that
section on account of the prohibition against assessments,
but shall rather cover the cost of marketing order adminis-
tration and services through funds available for the Agri-
cultural Marketing Service of the Department.
(f) IMPLEMENTATION OF REQUIREMENT.—The im-
plementation of the final decision on new Class III and
Class IV milk pricing formulas shall not be subject to con-
gressional review under chapter 8 of title 5, United States
Code.
SEC. 3. DAIRY FORWARD PRICING PROGRAM.
The Agricultural Adjustment Act (7 U.S.C. 601 et
seq.), reenacted with amendments by the Agricultural
Marketing Agreement Act of 1937, is amended by adding
at the end the following new section:
‘‘SEC. 23. DAIRY FORWARD PRICING PILOT PROGRAM.
‘‘(a) PILOT PROGRAM REQUIRED.—Not later than 90
days after the date of the enactment of this section, the
Secretary of Agriculture shall establish a temporary pilot
program under which milk producers and cooperatives are
authorized to voluntarily enter into forward price con-
tracts with milk handlers.
‘‘(b) MINIMUM MILK PRICE REQUIREMENTS.—Pay-
ments made by milk handlers to milk producers and co-
operatives, and prices received by milk producers and co-
operatives, under the forward contracts shall be deemed
to satisfy—
‘‘(1) all regulated minimum milk price require-
ments of paragraphs (B) and (F) of subsection (5)
of section 8c; and
‘‘(2) the requirement of paragraph (C) of such
subsection regarding total payments by each han-
dler.
‘‘(c) MILK COVERED BY PILOT PROGRAM.—
‘‘(1) COVERED MILK.—The pilot program shall
apply only with respect to the marketing of federally
regulated milk that—
‘‘(A) is not classified as Class I milk or
otherwise intended for fluid use; and
‘‘(B) is in the current of interstate or for-
eign commerce or directly burdens, obstructs, or
affects interstate or foreign commerce in feder-
ally regulated milk.
‘‘(2) RELATION TO CLASS I MILK.—To assist
milk handlers in complying with the limitation in
paragraph (1)(A) without having to segregate or
otherwise individually track the source and disposi-
tion of milk, a milk handler may allocate milk re-
ceipts from producers, cooperatives, and other
sources that are not subject to a forward contract to
satisfy the handler’s obligations with regard to Class
I milk usage.
‘‘(d) DURATION.—The authority of the Secretary of
Agriculture to carry out the pilot program shall terminate
on December 31, 2004. No forward price contract entered
into under the program may extend beyond that date.
‘‘(e) STUDY AND REPORT ON EFFECT OF PILOT
PROGRAM.—
‘‘(1) STUDY.—The Secretary of Agriculture
shall conduct a study on forward contracting be-
tween milk producers and cooperatives and milk
handlers to determine the impact on milk prices paid
to producers in the United States. To obtain infor-
mation for the study, the Secretary may use the au-
thorities available to the Secretary under section 8d,
subject to the confidentiality requirements of sub-
section (2) of such section.
‘‘(2) REPORT.—Not later than April 30, 2002,
the Secretary shall submit to the Committee on Ag-
riculture, Nutrition and Forestry of the Senate and
the Committee on Agriculture of the House of Rep-
resentatives a report containing the results of the
study.’’.
SEC. 4. CONTINUATION OF CONGRESSIONAL CONSENT FOR
NORTHEAST INTERSTATE DAIRY COMPACT.
Section 147(3) of the Agricultural Market Transition
Act (7 U.S.C. 7256(3)) is amended by striking ‘‘concur-
rent with’’ and all that follows through the period at the
end and inserting ‘‘on September 30, 2001.’’.
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