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EXHIBIT I 



EGG RESEARCH AND PROMOTION 



AUTHORIZING STATUTE: Egg Research and Consumer 

 Information Act of 1974 (7 U.S.C. 2701 et seq . ) 



SUMMARY OF PROVISIONS: The American Egg Board consists 

 of 18 members and 18 alternates appointed by the 

 Secretary from nominations submitted by 3 9 USDA- 

 certified egg producer organizations in 6 regions. The 

 program is funded by a nonrefundable assessment of 

 5 cents per 3 -dozen case of commercial eggs marketed. 

 Assessments are collected from producers by handlers. 

 Section 15 of the Act authorizes the Secretary to 

 impose civil penalties and/or cease and desist orders 

 against persons found to be in violation of the Act, 

 Order, or regulations, after such persons are provided 

 with an opportunity for an administrative hearing 

 before an administrative law judge. A civil penalty of 

 not less than $500 or more than $5,000 may be assessed 

 for each violation. Revenues generated annually 

 approximate $7.7 million and are used to fund a variety 

 of promotion, nutrition, research, and education 

 activities. The Act required that a referendum be 

 conducted prior to implementation of the program and 

 that the Order be favored by at least two- thirds of 

 producers voting or a majority of producers 

 representing at least two-thirds of the volume of eggs 

 produced by all voters. 



IMPLEMENTATION: The Egg Research and Promotion Order 

 was issued on December 22, 1975. Implementation was 

 through formal rulemaking. A referendum was conducted 

 November 3-28, 1975, by the Poultry Division, 

 Agricultural Marketing Service (AMS) . Seventy-three 

 percent of eligible producers approved the program. 

 Refundable assessments began August 1, 1976, through 

 issuance of Rules and Regulations following informal 

 rulemaking. 



The Order was amended effective January 1, 1989, to 

 implement 1988 amendments to the Act which provided for 

 (1) elimination of the refund provision for 18 months 

 and (2) establishment of an escrow account from which 

 producers could request a one-time refund. 

 Implementation was through informal rulemaking. A 

 referendum was conducted July 16-August 10, 1990, to 

 determine whether producers favored continuation of 

 nonrefundable assessments. The referendum passed 

 decisively, with 84 percent of producers supporting 

 elimination of refunds. 



