Source: https://www.federalregister.gov/documents/2014/03/07/2014-04693/milk-in-the-appalachian-and-southeast-marketing-areas-final-partial-decision-on-proposed-amendments
Timestamp: 2018-03-19 09:29:18
Document Index: 310289578

Matched Legal Cases: ['§\u20091005', '§\u20091005', '§\u20091000', '§\u20091005', '§\u20091000', '§\u20091000', '§\u20091005', '§\u20091000', '§\u20091007', '§\u20091000', '§\u20091000', '§\u20091007']

Federal Register :: Milk in the Appalachian and Southeast Marketing Areas; Final Partial Decision on Proposed Amendments to Marketing Agreements and to Orders
79 FR 12985
12985-13002 (18 pages)
2014-04693
https://www.federalregister.gov/d/2014-04693 https://www.federalregister.gov/d/2014-04693
This final decision proposes to permanently adopt revised transportation credit balancing fund provisions for the Appalachian and Southeast milk marketing orders. Specifically, this document Establishes a variable mileage rate factor using a fuel cost adjustor to determine the transportation credit payments of both orders; increases the transportation credit assessment rate for the Appalachian order to $0.15 per hundredweight; and establishes a zero diversion limit standard on loads of milk requesting transportation credits. Separate decisions will address the proposed adoption of an intra-market transportation credit provision for the Appalachian and Southeast orders and for increasing the transportation credit rate assessment for the Southeast order. This final decision is subject to producer approval. Producer approval for this action will be determined concurrently with amendments adopted in a separate final decision that amends the Class I pricing and other provisions of the Appalachian, Southeast, and Florida milk marketing orders.
Erin Taylor, USDA/AMS/Dairy Programs, Order Formulation and Enforcement Branch, STOP 0231-Room 2971, 1400 Independence Avenue SW., Washington, DC 20250-0231, (202) 720-7183, email address: Erin.Taylor@ams.usda.gov.
This final decision proposes to permanently adopt amendments that: (1) Establish a variable transportation credit mileage rate factor which uses a fuel cost adjustor in both orders; (2) Increase the Appalachian order's maximum transportation credit assessment rate to $0.15 per hundredweight (cwt); and (3) Establish a zero diversion limit standard on loads of milk requesting transportation credits.
This administrative action is governed by the provisions of sections 556 and Start Printed Page 12986557 of Title 5 of the United States Code and, therefore, is excluded from the requirements of Executive Order 12866.
The Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674) (the Act), provides that administrative proceedings must be exhausted before parties may file suit in court. Under section 608c(15)(A) of the Act, any handler subject to an order may request modification or exemption from such order by filing a petition with the United States Department of Agriculture (USDA) stating that the order, any provision of the order, or any obligation imposed in connection with the order is not in accordance with the law. A handler is afforded the opportunity for a hearing on the petition. After a hearing, USDA would rule on the petition. The Act provides that the district court of the United States in any district in which the handler is an inhabitant, or has its principal place of business, has jurisdiction in equity to review USDA's ruling on the petition, provided a bill in equity is filed not later than 20 days after the date of the entry of the ruling.
In accordance with the Regulatory Flexibility Act (5 U.S.C. 601-612), the Agricultural Marketing Service has considered the economic impact of this action on small entities and has certified that this proposed rule would not have a significant economic impact on a substantial number of small entities. For the purpose of the Regulatory Flexibility Act, a dairy farm is considered a “small business” if it has an annual gross revenue of less than $750,000, and a dairy products manufacturer is a “small business” if it has fewer than 500 employees.
Prior to amendments adopted on an interim basis, the Appalachian and Southeast orders provided transportation credits on supplemental shipments of milk for Class I use provided the milk was from dairy farmers who are not defined as a “producer” under the orders. A producer under the order is defined as a dairy farmer who: (1) during the immediately preceding months of Start Printed Page 12987March through May and not more than 50 percent of the milk production of the dairy farmer, in aggregate, is received as producer milk by either order during those 3 months; and (2) produced milk on a farm not located within the specified marketing areas of either order. The provisions of each order provide the market administrator the discretionary authority to adjust the 50 percent milk production standard to assure orderly marketing and efficient handling of milk in the marketing areas.
Upon the basis of the evidence introduced at the hearing and the record thereof, the Administrator, on September 1, 2006, issued a Tentative Partial Decision, published in the Federal Register on September 13, 2006 (71 FR 54118) containing notice of the opportunity to file written exception thereto.
This final decision specifically addresses proposals published in the hearing notice as Proposals 3, 1, and certain objectives of Proposal 4. Proposal 3 seeks to establish a variable mileage rate factor (MRF) using a fuel cost adjustor. Proposal 1 seeks to increase the maximum transportation credit assessment rates for both orders. The intent of Proposal 4 is to discourage the volume of milk pooled by diversions by reducing the amount of transportation credits a handler could receive. A complete discussion and findings on these three proposals appears after the summary of testimony.
A proposal, published in the hearing notice as Proposal 3, seeking to establish a variable mileage rate factor (MRF) that uses a fuel cost adjustor in the transportation credit payment provisions in both the Appalachian and Southeast orders, is recommended for permanent adoption. At the time of the hearing, the two orders provided for a fixed mileage rate of $0.035 per cwt per mile. The proposal was offered by Dairy Farmers of America, Inc. (DFA). DFA is a dairy farmer member-owned Capper-Volstead cooperative that at the time of the hearing had 12,800 member farmers whose milk was pooled throughout the Federal order system, including on the Appalachian and Southeast orders.
The SMA witness testified that the southeastern region of the United States is experiencing declining milk production while the population and demand for fluid milk are increasing. As a result, the witness stated that handlers servicing the Appalachian and Southeast marketing areas must continually seek supplemental supplies of milk from outside their normal milksheds. The witness added that the volume of supplemental milk needed to meet demand that cannot be met by local production and the distances from where the supplemental milk is obtained continues to increase. The witness explained that these marketing conditions cause the transportation Start Printed Page 12988credit balancing funds to be depleted at a rate faster than the rate at which handlers are assessed.
The SMA witness stressed that, for a variety of reasons, the proposed mileage rate computation reflects less than the actual cost of hauling. The witness asserted that the proposed mileage rate is based on costs of hauling from 2003, rather than a more current timeframe, and therefore would only reflect changes in the cost of diesel fuel since that time. The witness also reiterated that the proposed mileage rates would apply only to Class I milk shipped in Start Printed Page 12989excess of 85 miles, directly from farms to plants. The SMA witness was of the opinion that transportation costs will continue to increase and that adopting the proposed changes to the transportation credit provisions will avoid exhausting the transportation credit balancing fund before costs are reimbursed.
A post-hearing brief submitted by LOL reiterated support for the adoption of Proposal 3. The brief said that in order to fulfill the supplemental milk needs of the Appalachian and Southeast Start Printed Page 12990order marketing areas, milk is sourced from 28 States. According to the brief, this demonstrates that the distance milk must travel has further increased, thereby strengthening the justification for the adoption of Proposal 3. Additionally, a comment filed by LOL in response to the Tentative Final Decision expressed continued support for the adoption of Proposal 3.
A post-hearing brief submitted by KDDC in support of Proposal 3 said that Proposal 3 would benefit Kentucky dairy farmers by providing assistance in recovering market service costs.
A proposal, published in the hearing notice as Proposal 1, offered by DFA, that seeks to increase the maximum transportation credit balancing fund assessment rates for the Appalachian and Southeast orders is adopted. Specifically, the maximum transportation credit balancing fund assessment rate in the Appalachian order is increased by $0.055 per cwt on Class I milk for an amended rate of $0.15 per cwt. The Southeast order's maximum assessment rate was increased by $0.10 per cwt for an amended rate of $0.20 per cwt and implemented on an interim basis. Subsequent to the interim adoption of the $0.20 per cwt assessment rate, a separate rulemaking increased this rate to $0.30 per cwt (73 FR 14153). Accordingly, this decision would permanently adopt the higher assessment rate for the Appalachian order only.
The SMA witness testified that the different rates of transportation credit balancing fund assessments proposed for the Appalachian and Southeast orders reflect the differing costs of supplying supplemental milk into each marketing area. The witness stated that while the transportation credit assessment was waived for 2 months during 2002 and 2003 in the Appalachian order, assessments were not waived for the Southeast order. The Start Printed Page 12991witness asserted that while both orders rely on some of the same sources for supplemental milk, the Appalachian marketing area, at the time of the hearing, received most of its milk from the more northern Mid-Atlantic States while the Southeast marketing area received most of its supplemental milk from States located to the west and southwest of the marketing area. Furthermore, the witness added that different assessment rates for the two orders are warranted because at the time of the hearing, supplemental milk moved greater distances to service the Southeast market than it did to service the Appalachian market.
The SEDFA brief asserted that whether milk is produced inside or outside of the two marketing areas, the cost of moving Class I supplemental milk should be borne by the marketplace. The brief stated that while the reimbursement of actual hauling costs is much lower than in 1997, the amount of supplemental milk being brought into the marketing areas is increasing. The brief concluded that because reimbursement of actual hauling cost is smaller, the higher costs not reimbursed have fallen disproportionately on producers. The brief agreed with Lone Star and Maryland & Virginia that the $0.03 increase in the transportation credit assessments implemented in November 2005 [1] would be insufficient to cover the expected transportation credit claims during 2006.
The SMI witness testified that transportation credits should be eliminated. As an alternative, the witness suggested: (1) Establishing a Start Printed Page 12992method whereby Class I prices could be adjusted based on more regional marketing conditions; (2) adopting a base-excess plan; (3) increasing the current Class I differential level; and (4) any other provisions that would encourage local milk production.
A post-hearing brief submitted by the Kentucky Dairy Development Council (KDDC) supported Proposal 1. The brief noted that increasing the transportation credit assessment rate would benefit Kentucky dairy farmers by providing assistance in recovering costs associated with serving the market.
A proposal submitted by Dean Foods, published in the hearing notice as Proposal 4, seeks to reduce a handler's ability to utilize transportation credits to qualify producers for pooling on the orders. The intent of the proposal is to limit the pooling of additional surplus milk on the orders through the diversion process. At the time of the hearing, large volumes of milk were being pooled through diversions on the Appalachian and Southeast orders from locations distant from the marketing areas. While Proposal 4 would provide incentives to limit the pooling of milk through the diversion process, it would do so indirectly by limiting the payment of transportation credits. This decision chooses to directly limit diversions by establishing a zero diversion limit on milk that receives transportation credits.
The Dean witness also testified that the Class I price surface adopted during Federal milk order reform changed the relative relationship of milk value to its distance from the market. According to the witness, the location value of diverted milk prior to reform was determined by adjusting milk value according to its distance from an order's pricing point. The witness said this Start Printed Page 12993resulted in each plant having a different location adjustment value to its milk receipts depending on the order on which its receipts were pooled. The witness explained that the further milk was located from the order's pricing point, the less likely it was to be pooled as a diversion.
A witness appearing on behalf of SMA also testified in opposition to Proposal 4. The witness was of the opinion that the orders touch-base and diversion limit standards already provide sufficient safeguards to pooling milk not needed for Class I use. The SMA witness explained that it is difficult to establish specific diversion limits on supplemental milk, as contained in Proposal 4, because of individual differences in the balancing needs of each distributing plant, noting that these needs continually change. The witness emphasized that difficulties in balancing the orders' pool distributing plants exist year-round, and that suppliers sometimes have no control over factors that may alter balancing needs. The witness noted that some of SMA's purchase agreements for supplemental milk included Start Printed Page 12994arrangements where transportation credit payments are paid directly to the supplying cooperative. In this regard, the witness expressed concern that providing a separate diversion limit on milk receiving transportation credit payments would unfairly penalize the cooperative when a distributing plant overestimates its need for supplemental milk. The witness stated that extreme variations in daily, weekly, and monthly deliveries to pool distributing plants occur. Relying on market administrator data for January 2004 through October 2005 that showed the ratio of the highest delivery to lowest delivery day, the witness concluded that a 30 percent reserve factor would not have been sufficient to cover distributing plant balancing needs.
A post-hearing brief was submitted on behalf of Lone Star in opposition to Proposal 4. The premise of its opposition was that Proposal 4 would establish a “one-size-fits-all” diversion limit for all Class I handlers. The brief noted that a distributing plant's reserve milk needs are individual decisions in response to its customer base and seasonal changes in demand. The brief expressed the opinion that the orders already provide for some of the most strict diversion limit standards and touch-base requirements in the Federal order system.
Comments filed by Dean in response to the tentative partial decision supported the proposed amendments as recommended by USDA. The brief offered support of USDA's alternative to Proposal 4 which, in its opinion, more directly addressed the problem of pooling diverted milk that is associated with supplemental milk supplies. Dean also stated that since the Department's alternative continued to address the intent of Proposal 4, it would support the adoption of Proposals 1 and 3. In brief, Dean expressed that USDA's decision adequately addressed concerns it expressed at the hearing regarding pooling abuse and ensuring that transportation credits only reimburse handlers for a portion of the supplemental hauling costs.
Comments filed on behalf of SMA also expressed support for the amendments recommended in the tentative final decision. SMA stated that the recommended amendments would ensure that there are sufficient funds available to fund the transportation credit balancing fund and that transportation credits would better reflect the changing costs of supplying supplemental milk to the southeastern region. Comments filed on behalf of LOL supported the adoption of Proposals 1 and 3. LOL stated that increasing the transportation credit assessment rates and updating the payment rate to better reflect the cost of fuel were long overdue improvements to the two orders' transportation credit provisions. However, LOL took exception with USDA's recommendation regarding Proposal 4 (pooling of diverted milk through supplemental milk supplies). LOL argued that by not allowing diversions on supplemental milk supplies, supplemental milk suppliers located outside of the marketing areas would bear the burden of balancing the markets' seasonal milk needs. LOL also argued that while USDA asserted in the tentative final decision that limiting diversions on supplemental milk supplies would increase blend prices to the orders' dairy farmers, no analysis was provided to verify the claim. Additionally, LOL wrote that the record reveals the problem with diversions is greater in the Southeast marketing area and therefore unique marketing conditions call for unique provisions in each order.
The issue before USDA in this decision is the consideration of changes to the transportation credit and closely related provisions of the Appalachian and Southeast milk marketing orders. Transportation credit provisions have been a feature of the current orders (and their predecessor orders) since 1996. The need for transportation credit provisions arose from a consistent need to import milk from considerable distances to the marketing areas during certain months of the year when local milk production was not sufficient to meet Class I demands. Transportation credit provisions provide payments to handlers to cover a portion of the costs of hauling supplemental milk supplies into the Appalachian and Southeast marketing areas during the months of January, February, and July through December—a time period during which supplemental milk is needed to meet the demand for Class I milk at distributing plants.
The record reveals that the Appalachian marketing area, and in particular, the Southeast marketing area, are chronically unable to meet Class I demands. Local milk production relative to demand has declined and is expected to continue declining. Consequently, local milk production is not always able to fulfill the Class I needs of the markets which necessitates the need for supplemental milk from distant locations. As local milk production has eroded, the volume of supplemental milk needed for fluid use has increased, while at the same time the distance from the marketing areas from which the supplies are obtained has increased. This development is particularly evident for the Southeast marketing area. These combined factors have caused the transportation credit balancing fund (TCBF) to be insufficient in covering requested transportation Start Printed Page 12995credit payments. The TCBF will likely not be able to cover future requested payments unless the amendments contained in this decision are adopted.
While both marketing areas are able to supply the Class I needs of their respective markets during the spring “flush” months without the need for transportation credits, the record clearly indicates that both orders are unable to fully supply their fluid needs with local production during the last 6 months of the year. The chronic shortage of milk for fluid uses during this period has worsened over time, especially in the Southeast marketing area. Evidence shows that the trend of declining production relative to demand will result in an increased need for supplemental milk supplies and it is likely that this trend will continue into the foreseeable future.
Based on record evidence, this decision continues to find that the mileage rate factor (MRF) used to determine the payment of transportation credits should include a fuel cost adjustor as proposed in DFA's Proposal 3.
The original fixed mileage rate for both orders was $0.037 per cwt per mile when the transportation credit provisions were first established in 1996. The computation of the transportation credit payments was based on the total miles supplemental milk was shipped from its point of origination to its destination—the receiving pool distributing plant. In 1997, several amendments were made to the transportation credit provisions of the orders that included a reduction of the mileage rate from $0.037 per cwt per mile to the current $0.035 per cwt per mile.[2]
The randomly selected hauling bills depict actual origination and destination points of the milk hauled, miles traveled, and the rates and fuel surcharges per loaded mile for each bill. For the month of October 2005, the data indicate that hauling costs ranged from $1.89 to $2.70 per loaded mile, with an average cost of $2.48 per loaded mile. Data also show that the simple average hauling rate charged per loaded mile in the Southeast marketing area was $1.9332 and $1.8913 in October and November 2003, respectively, yielding a two-month simple average cost of $1.9122 per loaded mile. Therefore, it is reasonable to conclude that a reference hauling rate of $1.91 per loaded mile be used as a component in the MRF calculations.[3]
Another component needed in the calculation of the MRF is the average number of miles traveled per gallon of fuel used in transporting milk. Start Printed Page 12996Combination truck fuel economy data, regularly maintained by the United States Department of Transportation, indicates that the average miles per gallon for a combination truck was 5.2 in 2002; and 5.1 in 2003. The record also consists of testimony revealing that the dairy industry typically estimates fuel economy at between 5.0-6.0 miles per gallon. Therefore, given that 5.5 miles per gallon is the median point, and the goal of this decision is to promote efficiencies, the record finds that a 5.5-mile per gallon fuel consumption rate is reasonable and should be used to compute the MRF.
Due to a number of unknown variables, it is not possible to predetermine the percent of the total transportation costs that will be reimbursed by TCBF payments. However, the transportation credit provisions already contain precautionary measures for how the MRF is calculated. The record indicates that reference diesel fuel prices and reference hauling costs per loaded mile are components of the mileage rate calculation and are based on 2003 data that are more current than the data considered and adopted in 1997 establishing a fixed mileage rate. Finally, current transportation credit provisions do not include the first 85 miles that supplemental milk is shipped from farms in determining the total miles shipped. This feature also plays a part to safeguard against excessive transportation credit payments.
This decision continues to find that the transportation credit assessment rate in the Appalachian order should be increased to $0.15 per cwt on all Class I milk pooled.[4]
As discussed earlier in this decision, transportation credit provisions of the Appalachian and Southeast orders were originally established to partially offset the cost of transporting supplemental milk supplies into each marketing area to meet fluid milk demands. The transportation credit assessment rates have been increased twice in an effort to ensure that the TCBF would be sufficient to meet the expected claims. When first established for the Appalachian, Southeast, and predecessor orders (Orders 5, 7, 11 and 46), the maximum transportation credit assessment charged to Class I handlers was $0.06 per cwt for each order. The first increase, adopted in 1997, raised the maximum assessment by $0.005 per cwt for the Appalachian order and by $0.01 per cwt for the Southeast order.[5] The second increase in the maximum assessment rates for both orders became effective in November 2005.[6] The maximum assessment rates for both orders were increased by $0.03 per cwt, from $0.065 to $0.095 per cwt for the Appalachian order, and from $0.070 to $0.10 per cwt for the Southeast order.
[Percent of Transportation Credits Paid]
Jul 04 100.0
Aug 04 100.0
Sep 04 100.0
Oct 04 40.6
Nov 04 39.0
Dec 04 45.7
Jul 05 100.0
Aug 05 100.0
Sep 05 91.9
Oct 05 30.6
Nov 05 * 58.5
* Effective November 1, 2005, the transportation credit assessment rates were increased by 3 cents for the Appalachian order.
Source: Appalachian Market Administrator data.
The record supports concluding that local milk production is expected to continue declining within both marketing areas and will result in an even greater reliance on supplemental milk to meet the fluid milk needs of the Start Printed Page 12998markets. Record evidence shows a constant increase in both the volume and the distance, from which supplemental milk supplies are obtained. It is reasonable to conclude that future transportation credit claims will increase. In this regard, it is important to prevent exhausting the TCBF before the payment of claims on the supplemental milk have been met. Doing so is consistent with the fundamental purposes of the transportation credit provisions. Therefore, increasing the transportation credit assessment rate as contained in Proposal 1, will better assure that the rate of assessments will keep pace with the payments from the TCBF.
The intent of a proposal offered by Dean, published in the hearing notice as Proposal 4, seeks to provide a method to limit the amount of additional milk being pooled by diversion on the Appalachian and Southeast orders. As proposed, Dean's proposal would change the amount of transportation credits paid on eligible supplemental milk depending on the amount of milk delivered to plants other than pool distributing plants—this includes diversions to plants located outside of the marketing areas and deliveries to pool supply plants. Simply put, the greater the volume of diversions, the lower the amount of transportation credits paid. In this regard, Dean's proposal attempts to provide an incentive to limit diversions indirectly by reducing transportation credits paid on supplemental milk. This decision agrees with the need to limit pooling diverted milk on the orders that is linked to supplemental milk deliveries to distributing plants. Rather than attempt to create disincentives to pooling diverted milk indirectly, this decision addresses the issue directly by adopting a zero diversion limit standard on supplemental milk deliveries to distributing plants that receive transportation credits.
For the Appalachian order, only 2 months of data—October and November 2005—is available to estimate the maximum diversions that could be associated with supplemental milk. Relying on Appalachian Market Administrator data, it is estimated that the maximum diversions from transportation credit eligible milk during October and November 2005 were approximately 34 percent and 28 percent, respectively, of the total diversions at locations outside the Appalachian and Southeast marketing areas. Supplemental milk on the Appalachian order for October and Start Printed Page 12999November 2005 was approximately 19 percent, and 16 percent, respectively, of the total Class I milk pooled.
The transportation credit provisions of the Southeast and Appalachian orders are designed to attract supplemental milk supplies for Class I use when the orders' regular supplies cannot meet demand. Supplemental suppliers choose to provide this service and are subsequently compensated by receiving the orders' blend price and the ability to receive a transportation credit to reimburse them for part of the hauling cost. If, at any time, a supplemental supplier does not believe they are adequately compensated for their service, they may cease providing supplemental supplies. This decision continues to find that allowing milk diversions on supplemental milk supplies receiving a transportation credit lowers the TCBF monies available to supplemental milk loads that are actually delivered to the southeastern markets, and ultimately decreases the blend price paid to the orders' producers. A quantitative assessment is Start Printed Page 13000not necessary to conclude that the pooling of this diverted milk on the orders is disorderly and should not occur.
Briefs, proposed findings, and conclusions were filed on behalf of certain interested parties. These briefs, proposed findings, conclusions, and the evidence in the record were considered in making the findings and conclusions set forth above. To the extent that the suggested findings and conclusions filed by interested parties are inconsistent with the findings and conclusions set forth herein, the claims to make such findings or reach such conclusions are denied for the reasons previously stated in this decision.
(c) The tentative marketing agreements and the orders, as hereby proposed to be amended, will regulate the handling of milk in the same manner as, and will be applicable only to persons in the respective classes of industrial and commercial activity specified in, the marketing agreements upon which a hearing have been held.
Annexed hereto and made a part hereof are two documents—a Marketing Agreement regulating the handling of milk and an Order amending the order regulating the handling of milk in the Appalachian and Southeast marketing areas, that was approved by producers and published in the Federal Register on October 25, 2006 (71 FR 62377). These documents have decided upon as the detailed and appropriate means of effectuating the foregoing conclusions.
The month of July 2013 is hereby determined to be the representative period for the purpose of ascertaining whether the issuance of the order, as amended and as hereby proposed to be amended, regulating the handling of milk in the Appalachian and Southeast marketing areas is approved or favored by producers, as defined under the terms of the order as hereby proposed to be amended, who during such representative period were engaged in the production of milk for sale within the aforesaid marketing area.
(3) The total quantity of milk so diverted during the month by a Start Printed Page 13001cooperative association shall not exceed 25 percent during the months of July through November, January, and February, and 35 percent during the months of December and March through June, of the producer milk that the cooperative association caused to be delivered to, and physically received at, pool plants during the month, excluding the total pounds of bulk milk received directly from producers meeting the conditions as described in § 1005.82(c)(2)(ii) and (iii), and for which a transportation credit is requested;
(4) The operator of a pool plant that is not a cooperative association may divert any milk that is not under the control of a cooperative association that diverts milk during the month pursuant to paragraph (d) of this section. The total quantity of milk so diverted during the month shall not exceed 25 percent during the months of July through November, January, and February, and 35 percent during the months of December and March through June, of the producer milk physically received at such plant (or such unit of plants in the case of plants that pool as a unit pursuant to § 1005.7(d) during the month, excluding the quantity of producer milk received from a handler described in § 1000.9(c) of this chapter and excluding the total pounds of bulk milk received directly from producers meeting the conditions as described in § § 1005.82(c)(2)(ii) and (iii), and for which a transportation credit is requested;
(a) On or before the 12th day after the end of the month (except as provided in § 1000.90 of this chapter), each handler operating a pool plant and each handler specified in § 1000.9(c) shall pay to the market administrator a transportation credit balancing fund assessment determined by multiplying the pounds of Class I producer milk assigned pursuant to § 1005.44 by $0.15 per hundredweight or such lesser amount as the market administrator deems necessary to maintain a balance in the fund equal to the total transportation credits disbursed during the prior June-February period. In the event that during any month of the June-February period the fund balance is insufficient to cover the amount of credits that are due, the assessment should be based upon the amount of credits that would had been disbursed had the fund balance been sufficient.
(b) The market administrator shall announce publicly on or before the 23rd day of the month (except as provided in § 1000.90 of this chapter) the mileage rate pursuant to paragraph (a) of this section for the following month.
(4) The operator of a pool plant that is not a cooperative association may divert any milk that is not under the control of a cooperative association that diverts milk during the month pursuant to paragraph (d) of this section. The total quantity of milk so diverted during the month shall not exceed 25 percent during the months of July through November, January and February, and 35 percent during the months of December and March through June of the producer milk physically received at such plant (or such unit of plants in the case of plants that pool as a unit pursuant to § 1007.7(e)) during the month, excluding the quantity of producer milk received from a handler described in § 1000.9(c) of this chapter, excluding the total pounds of bulk milk received directly from producers meeting the conditions as described in section 1007.82(c)(2)(ii) and (iii), and for which a transportation credit is requested.
(b) The market administrator shall announce publicly on or before the 23rd day of the month (except as provided in § 1000.90 of this chapter) the assessment pursuant to paragraph (a) of this section for the following month.
(ii) Multiply the number of miles so determined by the mileage rate for the month computed pursuant to § 1007.83(a)(6); * * * * *
I. The findings and determinations, order relative to handling, and the provisions of § __ to __[7] all inclusive, of the order regulating the handling of milk in the ___[8] marketing area (7 CFR Part __[9] ) which is annexed hereto; and
II. The following provisions: § __[10] Record of milk handled and authorization to correct typographical errors.
(a) Record of milk handled. The undersigned certifies that he/she handled during the month of ___,[11] ___ hundredweight of milk covered by this marketing agreement.
1. 70 FR 59221.
2. 62 FR 39738.
3. It should be noted that as a result of the Emergency Hurricane hearing held for the Appalachian, Florida and Southeast marketing orders during the fall of 2004, a reasonable haul rate used to determine how handlers would be compensated for the transportation costs of extraordinary movements of milk was established for a temporary time period. Specifically, a maximum of $2.25 per loaded mile hauling rate was established (69 FR 71697).
4. The Southeast order transportation credit assessment rate has subsequently been increased in a separate rulemaking proceeding (73 FR 14153).
5. 62 FR 39738.
6. 70 FR 59221.
7. First and last section of order.
8. Name of order.
9. Appropriate Part number.
10. Next consecutive section number.
11. Appropriate representative period for the order.
[FR Doc. 2014-04693 Filed 3-6-14; 8:45 am]