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Federal Register / Vol. 86, No. 167 / Wednesday, September 1, 2021 / Rules and Regulations E-Government Act USDA is committed to complying with the E-Government Act 44 U.S.C.
3601, et seq. by promoting the use of the internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes. Forms can be found at http www.ams.usda.gov/ddp and filed through email at ddp@
usda.gov.
Statutory and Regulatory Authority Section 762 of the Consolidated Appropriations Act of 2021 mandates that AMS establish and administer a Dairy Donation Program 7 CFR part 1147. The program is intended to facilitate the timely donation of eligible dairy products and prevent and minimize food waste.

Executive Orders 12866 and 13563
USDA is issuing this rule in conformance with Executive Orders 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximizes net benefits including potential economic, environmental, public health, and safety effects; distributive impacts;
and equity. Executive Order 13563
emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. AMS has determined this action, mandated by Congress, meets the requirements set forth in the Consolidated Appropriations Act of 2021 to facilitate donation of eligible dairy products and prevent and minimize food waste.
AMS is seeking comments on the economic impacts of this action on the
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industry, including availability of information or data that may demonstrate if and how DDP
reimbursements affect the market.
AMS considered alternative methods for allocating available funds under the program, including whether to allocate reimbursements equally across all the geographic areas of the United States or to target specific regions in need of milk donations. Ultimately, AMS determined that because the programs primary purpose is to reduce waste associated with the disposition of surplus milk, the industry would be best served by allowing those with the capacity to process surplus milk and who are in a position to make donations to apply for the program without consideration of geographic location.
This rule is not expected to have any quantified cost or benefits, rather the rule is expected to result in transfers consistent with the following table:

TABLE 1ACCOUNTING STATEMENT
Primary estimate Benefits:
Annualized Monetized $millions/year
Costs:
Annualized Monetized $millions/year

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TransfersFrom the Federal Government to an eligible partnership:
Annualized Monetized $millions/year

As the program is voluntary, eligible partnerships are expected to only participate if they deem it beneficial depending on their individual circumstances. The transfers will be reimbursements in the form of Federal payments to program participants to help offset costs associated with eligible dairy product donations.
In the normal course of transporting, delivering, and processing milk, a small volume of milk is lost each month. In the FMMO system, normal losses are estimated to be 0.25 percent of the total participating milk annually. Under certain conditions, an additional volume of milk cannot make it to market due to extraordinary circumstances, such as extreme weather, plant capacity issues, and market disruptions. This volume above normal losses is identified as excess losses in this analysis. According to FMMO statistics, excess losses averaged 0.12 percent of the annual volume of milk participating in the FMMO program from 2016
through 2020. In 2020, the COVID19
pandemic resulted in higher levels of
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milk that could not make it to market, amounting to 0.32 percent of the milk that participated in the FMMO program.
In conducting an economic analysis, AMS assumed that milk classified as excess losses could be made into eligible dairy products and donated under the DDP.
To estimate the volume of excess milk that may be donated under the program, the 5-year average rate of 0.12 percent was applied to the projected 2021 U.S.
milk production volume. Thus, it is assumed that approximately 273.2
million pounds of milk would be available for dairy processors to make into eligible dairy products for donation to eligible distributors. No data exits from which AMS could estimate how much bulk commodity product could be available for secondary processors to purchase and further process into eligible dairy products for donation to eligible distributors, so that scenario was not considered in the economic analysis. AMS is seeking public comment on data from which to estimate how much bulk commodity
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product could be available for secondary processors to purchase and further process for donation.
AMS estimated the amounts of butterfat and skim solids in the forecasted product volumes available for donation. The product mix included fluid milk, soft products, cheese, butter, and nonfat dry milk powder volumes, based on the volume of available dairy farmer milk. The set of products utilizes approximately all the butterfat and skim solids present in the milk available for donation. In the case of butter and nonfat dry milk powder, both products can be made from a given amount of milk. Butter requires a large amount of butterfat, while powder utilizes very little butterfat but a large amount of the nonfat solids.
The DDP will reimburse EDOs for eligible dairy product donations for the input cost paid for the fluid milk or bulk dairy commodity product, manufacturing cost, and transportation cost. Total reimbursement must be between the highest FMMO Class I
value Dade county, Florida and the
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