The bill provides for a maximum assessment rate of 1 cent per hundredweight. Handlers are responsible for payment of the assessments, and they may deduct them from their settlement with the producers. Producers will be able to obtain a refund on the assessments paid by them, if they request it in the time and manner prescribed. The bill provides that hearings with respect to a proposed plan be held when requested by potato producers. A favorable referendum vote, by two-thirds of the potato producers voting in such referendum, or two-thirds of their production and not less than a majority of those voting, is required to approve any plan issued pursuant to this bill. If such a plan is favored by producers, a board will be appointed by the Secretary of Agriculture from industry nominations of eligible producers. Such board will administer the plan under the supervision of the Secretary of Agriculture. Provisions in this bill are similar to those in Public Law 89-502 (80 Stat. 279) enacted by the 89th Congress, and cited as the "Cotton Research and Promotion Act." Promulgation and referendum proceedings for any "Plan" issued pursuant to this bill are similar to those in marketing orders authorized by the Agricultural Marketing Agreement Act of 1937, as amended. Administrative provisions are also similar to those in marketing orders. There are no provisions for quality control or compulsory inspection in this bill. The potato producers have been confronted, in recent years, with increased competition from other products marketed as easily prepared convenience foods. Some of these products are promoted on a national basis. Potato producers have not been able to effectively match this competition because production and marketing of potatoes is performed by numerous individual farmers in every State in the United States. This has made it difficult for them to finance and carry out adequate research and promotion projects to maintain a competitive position in the markets. This bill would give potato producers authority to help themselves by financing such projects. Several potato producing areas have State orders or commissions to promote potatoes produced in their specific areas. This bill is intended to supplement these existing programs with a nationally coordinated program. The Department recommends the following modifications of this bill: (1) In section 2, page 1, line 6 (Findings and Declaration of Policy), it is recommended that the "findings", as contained in the national potato research and promotion bill in the 90th Congress (S. 2862 dated January 23, 1968, predecessor to this bill), be added as a part of section 2 of this bill. The addition would make clear that the legislation is intended to exercise the full sweep of the Federal commerce powers. It would also facilitate administration and enforcement as proof would not be required in each action for enforcement that the potatoes involved were in interstate commerce or directly burdened, obstructed, or affected interstate commerce in potatoes or potato products. In the event the "findings" are not added, section 4 should be modified to indicate the intention to exercise the full sweep of the federal commerce powers. In section 4, page 3, line 25 (Authority to S. Rept. 91-416 Issue a Plan), add to the end of the sentence the following: "and as are in the current of interstate commerce or directly burden, obstruct, or affect interstate commerce in potatoes or potato products." (2) In subsection 3(d), page 2, line 20-22 (definitions), revise the term "handler" to read as follows: "(d) The term "handler" means any person (except a common or contract carrier of potatoes owned by another person) who handles potatoes in a manner specified in a plan issued pursuant to this Act or in the rules and regulations issued thereunder." (3) In section 3, page 2, beginning on line 23, delete subsection (e) — the definition of "handle"-and renumber the remaining definitions. (4) In subsection 10(a), page 9, (assessments) revise the language beginning on line 25 and continuing through the word "potatoes,' in line 3 on page 10, to read as follows: "Sec. 10(a) Each handler designated by the board, pursuant to regulations issued under the plan, to make payment of assessments shall be responsible for payment to the board, as it may direct, of any assessment levied on potatoes;". Also in subsection 10(a), add a sentence at the end to read as follows: "To facilitate the collection and payment of such assessments, the board may designate different handlers or classes of handlers to recognize difference in marketing practices or procedures utilized any State or area. No more than one such assessment shall be made on any potatoes." in The changes in (2) and (3) are recommended in the interest of providing a greater degree of flexibility in designating the various activities that will make a person a "handler." The change in (4) will provide flexibility in designating the "handler" responsible for payment of assessments to, as well as the manner and method of collection of assessments by, the board. These changes follow similar provisions in the Cotton Research and Promotion Act and are desirable in the light of our experience under that act. (5) In section 6, page 4, line 16 (finding and issuance of a plan), delete "or modification," as being unnecessary and confusing isasmuch as the Secretary must find that all the terms and conditions contained in the plan as issued, will tend to effectuate the declared policy of the act. (6) In subsection 9(e), page 9, lines 11 and 12 (permissive terms in plans) modify "research and development or advertising and promotion" to read "research, development, advertising and promotion." This change will make the quoted modification conform to other specifications of such activities elsewhere in the act. (7) In subsection 12(b), (Enforcement) delete the word "willfully" in two places on page 13, lines 6 and 8. "Willfully" is an undesirable term because it is difficult to prove and would result in administrative and enforcement difficulties. Also in subsection 12(b), page 13, line 10, delete the words "liable to a penalty or not" and substitute in lieu thereof the words "fined not less than $100 or"; and delete the balance of the paragraph. following the word "offense" in line 11. This change substitutes terminology generally associated with criminal prosecution in place of language relating to civil action. Additionally, specific authorization for civil action to collect unpaid assessments is unnecessary as S. Rept. 91-416 barley, Durum wheat, alfalfa hay, and potatoes can be raised. Durum wheat is ordinarily rotated between potatoes and barley, to reduce the protein content in the barley so that it is acceptable for malt. In addition, there is a good market for Durum wheat on the west coast which cannot be readily and economically supplied from other Durum producing regions. The climatic and other conditions necessary to the production of good Durum are such that it can be produced in very few areas. COMMITTEE AMENDMENTS The committee amendments would- (1) Provide that the Tulelake producers receive no additional wheat marketing certificates as a result of their increased allotments; (2) Make the bill effective with the 1970 crop (since Tulelake producers were required to cut back their acreage by August 1 to comply with their 1969 allotments, and the bill could consequently benefit only allotment violators in 1969; and (3) Strike the designation "(class II)" from the bill since that designation is obsolete, being no longer used in the Official Grain Standards of the United States. Based on the latest available date (1969 crop), full participation in the program, and full application of the bill, the estimated value of additional wheat marketing certificates that Tulelake area farmers would have received annually under the bill as introduced would have been $355,775.40. Farmers outside the Tulelake area would have lost an identical amount. Expressed in terms of cents per bushel of projected production on participating farms the loss to farmers outside the Tulelake area would have been 0.029 cents (one-thirty-fourth of a cent) per bushel. The committee felt that there was no justification for such transfer of wheat marketing certificates, particularly since the Tulelake farmers have the advantage of a good market. The committee has therefore recommended an amendment providing that the additional acreage provided by the bill shall not be taken into account in determining the farm wheat marketing allocation. The committee's estimate was made as set out in exhibit A. DEPARTMENTAL VIEWS The adverse report of the Department of Agriculture is attached as exhibit B. The committee feels that the amendments recommended by it should lessen or remove the Department's objections. EXHIBIT A-COMPUTATION OF ESTIMATED ADDITIONAL WHEAT MARKETING CERTIFICATES TULELAKE FARMERS WOULD HAVE RECEIVED UNDER THE BILL AS INTRODUCED The 1969 wheat acreage allotment for the Tulelake area was 5,374 acres. The bill would increase the allotment to 12,000 acres, thus providing for an increase of 6,626 acres. The Department advises that projected yields in the area run about 80 to 84 bushels per acre, and estimates the average projected yield for the area at 82 bushels per acre. The additional projected production provided for by the S. Rept. 91-417 Mr. HOLLAND, from the Committee on Agriculture and Forestry, submitted the following REPORT [To accompany S. 858] The Committee on Agriculture and Forestry, to which was referred the bill (S. 858) to amend the Agricultural Adjustment Act, of 1938 with respect to wheat, having considered the same, reports favorably thereon with amendments and recommends that the bill (as amended) do pass. EXPLANATION OF BILL This bill would increase wheat acreage allotments in the irrigable portion of the Tulelake area of California each year to a total of 12,000 acres. The 1969 allotment for the area is 5,374 acres. As amended by the committee amendments, producers would not receive additional marketing certificates as a result of the increase in their allotments; but they would be able to plant their increased allotments without forfeiting all price support and marketing certificates. To qualify for an increase the entire farm allotment would have to be planted to Durum wheat. A farm receiving an increase would not be eligible for wheat diversion payments. The Committee's Subcommittee on Agricultural Production, Marketing, and Stabilization of Prices held hearings at which some questions were raised as to action on this bill serving as a precedent for similar action in other areas. The committee did not feel that enactment of the bill should have this effect. The committee felt that the special and unusual conditions applicable in the Tulelake area warranted the relief provided by the bill. The area is reclaimed lake bottom which was homesteaded by World War I and II veterans. The farms are very small, averaging about 70 acres. The area is in the northeast corner of California, a high mountainous desert area. Frosts can occur any month of the year. Due to climatic conditions and distance from market, only hardy types of crops, such as malting barley, Durum wheat, alfalfa hay, and potatoes can be raised. Durum wheat is ordinarily rotated between potatoes and barley, to reduce the protein content in the barley so that it is acceptable for malt. In addition, there is a good market for Durum wheat on the west coast which cannot be readily and economically supplied from other Durum producing regions. The climatic and other conditions necessary to the production of good Durum are such that it can be produced in very few areas. COMMITTEE AMENDMENTS The committee amendments would-- (1) Provide that the Tulelake producers receive no additional wheat marketing certificates as a result of their increased allotments; (2) Make the bill effective with the 1970 crop (since Tulelake producers were required to cut back their acreage by August 1 to comply with their 1969 allotments, and the bill could consequently benefit only allotment violators in 1969; and (3) Strike the designation "(class II)" from the bill since that designation is obsolete, being no longer used in the Official Grain Standards of the United States. Based on the latest available date (1969 crop), full participation in the program, and full application of the bill, the estimated value of additional wheat marketing certificates that Tulelake area farmers would have received annually under the bill as introduced would have been $355,775.40. Farmers outside the Tulelake area would have lost an identical amount. Expressed in terms of cents per bushel of projected production on participating farms the loss to farmers outside the Tulelake area would have been 0.029 cents (one-thirty-fourth of a cent) per bushel. The committee felt that there was no justification for such transfer of wheat marketing certificates, particularly since the Tulelake farmers have the advantage of a good market. The committee has therefore recommended an amendment providing that the additional acreage provided by the bill shall not be taken into account in determining the farm wheat marketing allocation. The committee's estimate was made as set out in exhibit A. DEPARTMENTAL VIEWS The adverse report of the Department of Agriculture is attached as exhibit B. The committee feels that the amendments recommended by it should lessen or remove the Department's objections. EXHIBIT A COMPUTATION OF ESTIMATED ADDITIONAL WHEAT MARKETING CERTIFICATES TULELAKE FARMERS WOULD HAVE RECEIVED UNDER THE BILL AS INTRODUCED The 1969 wheat acreage allotment for the Tulelake area was 5,374 acres. The bill would increase the allotment to 12,000 acres, thus providing for an increase of 6,626 acres. The Department advises that projected yields in the area run about 80 to 84 bushels per acre, and estimates the average projected yield for the area at 82 bushels per acre. The additional projected production provided for by the S. Rept. 91-417 |