[Federal Register Volume 63, Number 154 (Tuesday, August 11, 1998)]
[Rules and Regulations]
[Pages 42686-42688]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-21480]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 948
[Docket No. FV98-948-2 IFR]
Irish Potatoes Grown in Colorado; Exemption From Area No. 2
Handling Regulation for Potatoes Shipped for Experimentation and the
Manufacture or Conversion Into Specified Products
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
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SUMMARY: This interim final rule exempts shipments of potatoes handled
for experimentation and the manufacture or conversion into specified
products from the grade, size, maturity, and inspection requirements
prescribed under the handling regulations of the Colorado Potato
Marketing Order for Area No. 2 (San Luis Valley). This rule was
unanimously recommended by the Colorado Potato Administrative Committee
for Area No. 2 (Committee), the agency responsible for local
administration of the marketing order. This rule is designed to expand
markets for potatoes and to increase fresh utilization. These changes
are expected to improve the marketing of Colorado potatoes and increase
returns to producers.
DATES: Effective August 12, 1998; comments received by October 13, 1998
will be considered prior to issuance of a final rule.
ADDRESSES: Interested persons are invited to submit written comments
concerning this rule. Comments must be sent to the Docket Clerk, Fruit
and Vegetable Programs, AMS, USDA, room 2525-S, PO Box 96456,
Washington, DC 20090-6456; Fax: (202) 205-6632. All comments should
reference the docket number and the date and page number of this issue
of the Federal Register and will be made available for public
inspection in the Office of the Docket Clerk during regular business
hours.
FOR FURTHER INFORMATION CONTACT: Dennis L. West, Northwest Marketing
Field Office, Marketing Order Administration Branch, Fruit and
Vegetable Programs, AMS, USDA, 1220 SW Third Avenue, room 369,
Portland, Oregon 97204; telephone: (503) 326-2724, Fax: (503) 326-7440;
or George J. Kelhart, Marketing Order Administration Branch, Fruit and
Vegetable Programs, AMS, USDA, Room 2525-S, PO Box 96456, Washington,
DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205-6632. Small
businesses may request information on compliance with this regulation
by contacting Jay Guerber, Marketing Order Administration Branch, Fruit
and Vegetable Programs, AMS, USDA, room 2525-S, PO Box 96456,
Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205-
6632.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement No. 97 and Marketing Order No. 948 (7 CFR part 948), both as
amended, regulating the handling of Irish potatoes grown in Colorado,
hereinafter referred to as the ``order.'' The order is authorized by
the Agricultural Marketing Agreement Act of 1937, as amended, (7 U.S.C.
601-674), hereinafter referred to as the ``Act.''
The Department of Agriculture (Department) is issuing this rule in
conformance with Executive Order 12866.
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. This rule is not intended to have retroactive effect.
This rule will not preempt any State or local laws, regulations, or
policies, unless they present an irreconcilable conflict with this
rule.
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 file with the Secretary a
petition stating that the order, any provision of the order, or any
obligation imposed in connection with the order is not in accordance
with law and request a modification of the order or to be exempted
therefrom. A handler is afforded the opportunity for a hearing on the
petition. After the hearing the Secretary would rule on the
[[Page 42687]]
petition. The Act provides that the district court of the United States
in any district in which the handler is an inhabitant, or has his or
her principal place of business, has jurisdiction to review the
Secretary's ruling on the petition, provided an action is filed not
later than 20 days after date of the entry of the ruling.
This rule exempts shipments of potatoes handled for the purposes of
experimentation and the manufacture or conversion into specified
products from the grade, size, maturity, and inspection requirements
prescribed under the order's handling regulations for Area No. 2 (San
Luis Valley).
Section 948.22 authorizes the issuance of regulations for grade,
size, quality, maturity, and pack for any variety or varieties of
potatoes grown in different portions of the production area during any
period. Section 948.23 authorizes the issuance of regulations that
modify, suspend, or terminate requirements issued under Sec. 948.22 or
to facilitate the handling of potatoes for special purposes. Section
948.24 requires adequate safeguards to be prescribed to ensure that
potatoes handled pursuant to Sec. 948.23 enter authorized trade
channels. Safeguard procedures for special purpose shipments are
specified in Secs. 948.120 through 948.125.
At its meeting on June 18, 1998, the Committee unanimously
recommended that handlers of potatoes shipped for experimentation and
for the manufacture or conversion into specified products be exempted
from the grade, size, maturity, and inspection requirements prescribed
under the order's handling regulations for Area No. 2 in Sec. 948.386.
The Committee recommended that experimentation and manufacture or
conversion into specified products be added under Sec. 948.386(d)(2) as
special purpose shipments.
As is currently required for all special purpose shipments,
handlers would apply and obtain Certificates of Privilege for handling
such potatoes and furnish the Committee such information as the
Committee may require.
Several producers and handlers within the production area are
attempting to develop new fresh uses for potatoes using experimental
varieties and packs. The Committee also anticipates that some handlers
may want to ship experimental varieties, or traditional varieties, for
use in the manufacture or conversion into special products, or perform
the manufacture or conversion themselves prior to shipment. Handlers
are, for example, attempting to develop new special products such as
fresh cut potatoes shipped in vacuum sealed bags. The Committee
strongly encourages innovation that could result in the development of
new varieties, markets, or opportunities for fresh potatoes that would
be good for the Colorado potato industry. Some of the new varieties
have irregular shapes or are small in size, and that prevents them from
being shipped except under the minimum quantity exemption of 1,000
pounds specified in paragraph (f) of Sec. 948.386. This has prevented
handlers from shipping larger quantities. Handlers have also expressed
a desire to experiment with the shipment of potatoes of different
varieties in the same container. This is not currently possible because
the potatoes do not meet the minimum grade requirement that a
particular lot of potatoes have ``similar'' varietal characteristics.
For the purpose of this action, the term ``manufacture or
conversion into specified products'' means the preparation of potatoes
for market into products by peeling, slicing, dicing, applying material
to prevent oxidation, or other means approved by the Committee, but not
including other processing. Under the current regulation, potatoes for
manufacture or conversion into products must be inspected and certified
as meeting specified quality requirements prior to preparation for
market. This action will exempt shipments handled for experimentation
or the manufacture or conversion into products from these requirements,
thus, relieving handlers of this regulatory burden.
These changes to the Area No. 2 handling regulation are expected to
encourage new product development and could lead to market expansion
which would benefit producers, handlers, buyers, and consumers of
Colorado potatoes.
The special purpose shipments authorized by this action are fresh
use markets so it is appropriate that the handlers taking advantage of
the exemptions be assessed to defray the costs the Committee incurs in
administering the program, tracking such shipments, in determining
whether applicable requirements have been met, and in determining
whether the potatoes ended up in the proper trade channel. This rule is
designed to expand markets for potatoes and to increase fresh
utilization. These changes are expected to improve the marketing of
Colorado potatoes and increase returns to producers.
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA), the Agricultural Marketing Service (AMS) has considered the
economic impact of this action on small entities. Accordingly, the AMS
has prepared this initial regulatory flexibility analysis.
There are approximately 100 handlers of Colorado Area No. 2
potatoes who are subject to regulation under the marketing order and
approximately 285 producers of Colorado potatoes in the regulated area.
Small agricultural service firms have been defined by the Small
Business Administration (13 CFR 121.601) as those having annual
receipts of less than $5,000,000, and small agricultural producers are
defined as those whose annual receipts are less than $500,000. The
majority of potato producers and handlers regulated under the marketing
agreement and order may be classified as small entities.
This rule exempts shipments of potatoes handled for experimentation
and the manufacture or conversion into specified products from the
grade, size, maturity, and inspection requirements that are prescribed
under the order's handling regulations for Area No. 2 in Sec. 948.386.
At its meeting on June 18, 1998, the Committee unanimously
recommended that potatoes shipped for the purposes of experimentation
and for the manufacture or conversion into specified products be
considered special purpose shipments and be exempt from the grade,
size, maturity, and inspection requirements prescribed in Sec. 948.386.
The Committee recommended that experimentation and manufacture or
conversion into specified products be added under Sec. 948.386(d)(2) as
special purpose shipments.
As is currently required for all special purpose shipments,
handlers would apply and obtain Certificates of Privilege for handling
such potatoes and furnish the Committee such information as the
Committee may require to track such shipments, determine whether
applicable requirements have been met, and whether proper disposition
has occurred.
Several producers and handlers within the production area are
attempting to develop new fresh uses for potatoes using experimental
varieties and packs. The Committee also anticipates that some handlers
may want to ship experimental varieties, or traditional varieties, for
use in the manufacture or conversion into special products, or perform
the manufacture or conversion themselves prior to shipment. Handlers
are, for example, attempting to develop new special products such as
fresh cut potatoes shipped in vacuum sealed bags. The Committee
strongly encourages innovation that could result in the
[[Page 42688]]
development of new varieties, markets, or opportunities for fresh
potatoes that would be good for the Colorado potato industry. Some of
the new varieties have characteristics, such as small size or misshape,
that prevent them from being shipped fresh except under the minimum
quantity exemption of 1,000 pounds in paragraph (f) of Sec. 948.386.
This has placed a burden on handlers desiring to ship larger quantities
of such potatoes. Handlers have also expressed a desire to experiment
with the shipment of potatoes of different varieties in the same
container. This is not currently possible because the potatoes do not
meet the minimum grade requirement that a particular lot of potatoes
have ``similar'' varietal characteristics.
For purpose of this action, the term ``manufacture or conversion
into specified products'' means the preparation of potatoes for market
into products by peeling, slicing, dicing, applying material to prevent
oxidation, or other means approved by the Committee, but not including
other processing.
These changes to the handling regulation are expected to encourage
new product development and could lead to market expansion which would
benefit producers, handlers, buyers, and consumers of Colorado
potatoes.
The special purpose outlets authorized by this action are fresh use
markets so it is appropriate that handlers taking advantage of the
exemptions be assessed to defray the costs the Committee incurs in
administering the program, tracking such shipments, determining whether
applicable requirements have been met, and whether the potatoes end up
in proper trade channels. Currently, the assessment rate is $0.0030 per
hundredweight of potatoes handled. Effective September 1, 1998, the
rate will be $0.0015 per hundredweight of potatoes handled. This rule
is designed to expand markets for potatoes and to increase fresh
utilization. The changes are expected to improve the marketing of
Colorado potatoes and increase returns to producers.
There is no available information detailing how many potatoes this
relaxation will allow to be marketed.
No viable alternatives to this action were identified that would
ensure that innovations in marketing and product development.
Furthermore, the goals expressed by the committee could not be solved
absent this action.
The Committee estimates that three or four handlers may apply for
and obtain Certificates of Privilege for the handling of potatoes for
experimentation or for the manufacture or conversion into specified
products. It is estimated that the time taken by the handlers who apply
will total less than ten hours and this time is currently approved
under OMB No. O581-0111 by the Office of Management and Budget (OMB) in
accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter
35).
As with all Federal marketing order programs, reports and forms are
periodically reviewed to reduce information requirements and
duplication by industry and public sectors. In addition, the Department
has not identified any relevant Federal rules that duplicate, overlap
or conflict with this rule.
Further, the Committee's meeting was widely publicized throughout
the Colorado potato industry and all interested persons were invited to
attend the meeting and participate in Committee deliberations. Like all
Committee meetings, the June 18, 1998, meeting was a public meeting and
all entities, both large and small, were able to express their views on
this issue. The Committee itself is composed of 12 members, of which 5
are handlers and 7 are producers, the majority of whom are small
entities.
Finally, interested persons are invited to submit information on
the regulatory and informational impacts of this action on small
businesses.
After consideration of all relevant material presented, including
the Committee's recommendation, and other information, it is found that
this interim final rule, as hereinafter set forth, will tend to
effectuate the declared policy of the Act.
This rule invites comments on a change to the handling regulation
prescribed for Area No. 2 under the Colorado potato marketing order.
Any comments received will be considered prior to finalization of this
rule.
Pursuant to 5 U.S.C. 553, it is also found and determined upon good
cause that it is impracticable, unnecessary, and contrary to the public
interest to give preliminary notice prior to putting this rule into
effect and that good cause exists for not postponing the effective date
of this rule until 30 days after publication in the Federal Register
because: (1) This rule relaxes requirements on Area No. 2 handlers and
provides additional marketing opportunities; (2) this action must be
taken promptly so handlers can take advantage of the additional
marketing opportunities as soon as possible; (3) the Committee
unanimously recommended these changes at a public meeting and
interested parties had an opportunity to provide input; and (4) this
rule provides a 60-day comment period and any comments received will be
considered prior to finalization of this rule.
List of Subjects in 7 CFR Part 948
Marketing agreements, Potatoes, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 948 is
amended as follows:
PART 948--IRISH POTATOES GROWN IN COLORADO
1. The authority citation for 7 CFR part 948 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. In Sec. 948.386, paragraph (d)(2) is revised, and in paragraph
(g) a new sentence is added before the last sentence to read as
follows:
Sec. 948.386 Handling regulation.
* * * * *
(d) * * *
(1) * * *
(2) The grade, size, maturity and inspection requirements of
paragraphs (a), (b), and (c) of this section shall not be applicable to
shipments of potatoes for experimentation, the manufacture or
conversion into specified products, or for seed pursuant to section
948.6, but such shipments shall be subject to assessments.
* * * * *
(g) Definitions. * * * The term manufacture or conversion into
specified products means the preparation of potatoes for market into
products by peeling, slicing, dicing, applying material to prevent
oxidation, or other means approved by the committee, but not including
other processing. * * *
Dated: August 5, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-21480 Filed 8-10-98; 8:45 am]
BILLING CODE 3410-02-P