[Federal Register: May 5, 2004 (Volume 69, Number 87)]
[Rules and Regulations]
[Page 24909-24916]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05my04-1]
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Rules and Regulations
Federal Register
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[[Page 24909]]
DEPARTMENT OF AGRICULTURE
Animal and Plant Health Inspection Service
7 CFR Part 301
[Docket No. 03-052-1]
Karnal Bunt; Compensation for Custom Harvesters in Northern Texas
AGENCY: Animal and Plant Health Inspection Service, USDA.
ACTION: Interim rule and request for comments.
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SUMMARY: We are amending the Karnal bunt regulations to provide for the
payment of compensation to custom harvesters for losses they incurred
due to the requirement that their equipment be cleaned and disinfected
after four counties in northern Texas were declared regulated areas for
Karnal bunt during the 2000-2001 crop season. We are also amending the
regulations to provide for the payment of compensation to owners or
lessees of other equipment that came into contact with Karnal bunt-
positive host crops in those counties and was required to be cleaned
and disinfected during the 2000-2001 crop season. The payment of
compensation is necessary to reduce the economic burden imposed by the
regulations and to encourage the participation of, and obtain
cooperation from, affected individuals in our efforts to contain and
reduce the presence of Karnal bunt in the United States.
DATES: This interim rule is effective May 5, 2004. We will consider all
comments that we receive on or before July 6, 2004.
ADDRESSES: You may submit comments by any of the following methods:
Postal Mail/Commercial Delivery: Please send four copies
of your comment (an original and three copies) to Docket No. 03-052-1,
Regulatory Analysis and Development, PPD, APHIS, Station 3C71, 4700
River Road Unit 118, Riverdale, MD 20737-1238. Please state that your
comment refers to Docket No. 03-052-1.
E-mail: Address your comment to
regulations@aphis.usda.gov. Your comment must be contained in the body
of your message; do not send attached files. Please include your name
and address in your message and ``Docket No. 03-052-1'' on the subject
line.
Agency Web site: Go to http://www.aphis.usda.gov/ppd/rad/cominst.html
for a form you can use to submit an e-mail comment through
the APHIS Web site.
Federal eRulemaking Portal: Go to http://www.regulations.gov
and follow the instructions for locating this
docket and submitting comments.
Reading Room: You may read any comments that we receive on this
docket in our reading room. The reading room is located in room 1141 of
the USDA South Building, 14th Street and Independence Avenue SW.,
Washington, DC. Normal reading room hours are 8 a.m. to 4:30 p.m.,
Monday through Friday, except holidays. To be sure someone is there to
help you, please call (202) 690-2817 before coming.
Other Information: You may view APHIS documents published in the
Federal Register and related information, including the names of groups
and individuals who have commented on APHIS dockets, on the Internet at
http://www.aphis.usda.gov/ppd/rad/webrepor.html.
FOR FURTHER INFORMATION CONTACT: Mr. Robert G. Spaide, Senior Program
Advisor, Pest Detection and Management Programs, PPQ, APHIS, 4700 River
Road Unit 98, Riverdale, MD 20737; (301) 734-3769.
SUPPLEMENTARY INFORMATION:
Background
Karnal bunt is a fungal disease of wheat (Triticum aestivum), durum
wheat (Triticum durum), and triticale (Triticum aestivum X Secale
cereale), a hybrid of wheat and rye. Karnal bunt is caused by the smut
fungus Tilletia indica (Mitra) Mundkur and is spread primarily through
the movement of infected seed. In the absence of measures taken by the
U.S. Department of Agriculture (USDA) to prevent its spread, the
establishment of Karnal bunt in the United States could have
significant consequences with regard to the export of wheat to
international markets.
The regulations regarding Karnal bunt are set forth in 7 CFR
301.89-1 through 301.89-16 (referred to below as the regulations).
Among other things, the regulations define areas regulated for Karnal
bunt and restrict the movement of certain regulated articles, including
wheat seed and grain, from the regulated areas. The regulations also
provide for the payment of compensation for certain growers, handlers,
seed companies, owners of grain storage facilities, flour millers, and
participants in the National Karnal Bunt Survey who incurred losses and
expenses because of Karnal bunt during certain years. These provisions
are in Sec. 301.89-15, ``Compensation for growers, handlers, and seed
companies in the 1999-2000 and subsequent crop seasons,'' and Sec.
301.89-16, ``Compensation for grain storage facilities, flour millers,
and National Survey participants for the 1999-2000 and subsequent crop
seasons.''
On August 6, 2001, the Animal and Plant Health Inspection Service
(APHIS) published in the Federal Register a final rule (66 FR 40839-
40843, Docket No. 96-016-37) that established the compensation levels
for the 1999-2000 crop season and subsequent years and made several
other changes to the compensation regulations. One of these changes was
that, after the 2000-2001 crop season, compensation would no longer be
made available to persons growing or handling host crops that were
knowingly planted in previously regulated areas.
On May 1, 2002, APHIS published in the Federal Register an interim
rule (67 FR 21561-21566, Docket No. 01-112-1) that amended the
regulations governing compensation to address five particular
situations in four counties in northern Texas that arose during the
2000-2001 crop season. In Archer, Baylor, Throckmorton, and Young
Counties, certain wheat growers, handlers, and other parties covered by
the compensation regulations appeared to be ineligible to receive
compensation for grain or seed affected by Karnal bunt due to
restrictive language in the regulations that did not anticipate certain
complications in the harvest and storage of grain that arose following
[[Page 24910]]
discovery of Karnal bunt in those counties. Due to the need to quickly
declare these counties as regulated areas, we were unable to modify the
compensation regulations at that time to address certain relevant
aspects of the way seed and grain were moved, stored, and used in the
newly regulated areas. The May 2002 interim rule amended the
compensation provisions of the regulations to allow persons included in
these five situations to apply for compensation.
We solicited comments concerning the interim rule for 60 days
ending July 1, 2002. We received 86 comments by that date. They were
from producers, representatives of industry groups, and representatives
of State and foreign governments. In this document, we address the
comments we received regarding the payment of compensation to custom
harvesters and owners or lessees of other equipment in the four Texas
counties during the 2000-2001 crop season. The other comments we
received in response to the interim rule will be addressed in a
subsequent document.
Seventy-eight commenters urged APHIS to provide for the payment of
compensation to custom harvesters who operate in areas regulated for
Karnal bunt, in addition to the compensation for growers, handlers, and
other affected individuals provided by the interim rule. Some
commenters stated that the cost of cleaning and disinfecting mechanized
harvesting equipment after it has been used to harvest Karnal bunt-
positive host crops prior to movement from a regulated area, as
required by Sec. 301.89-12(a), would either be absorbed by custom
harvesters, causing them significant economic losses, or passed on to
growers, already suffering losses from restrictions on the movement of
their crops, in the form of higher rates.
Some custom harvesters, other commenters argued, might choose to
avoid harvesting in regulated areas altogether; this would increase the
economic losses suffered by growers in regulated areas, since the
demand for custom harvesting services in regulated areas would exceed
the supply, and growers would likely have to pay higher fees to have
their crop harvested. If custom harvesters that normally operate in
regulated areas chose to avoid harvesting in such areas, this would
also drive down the incomes of custom harvesters that normally harvest
outside regulated areas, due to increased competition.
Finally, many commenters noted that encouraging growers to
participate in the Karnal bunt eradication program is a stated goal of
the compensation program currently in place; without similar incentives
for custom harvesters, they might not clean their mechanized harvesting
equipment in accordance with the regulations when moving from a
regulated area to an area not affected by Karnal bunt, possibly leading
to further spread of Karnal bunt.
Most commenters favored compensating custom harvesters for the cost
of cleaning their equipment if it is used to harvest Karnal bunt-
positive host crops in a regulated area. The commenters also noted that
custom harvesters typically set their schedules months in advance,
meaning that custom harvesters could lose harvesting contracts due to
the downtime (typically 8 hours) necessitated by cleaning and
disinfecting mechanized harvesting equipment after it had been used to
harvest Karnal bunt-positive host crops in a regulated area;
compensation for contracts lost for this reason was also requested.
We agree that custom harvesters who operated in the four affected
Texas counties suffered economic losses due to the designation of these
counties as areas quarantined for Karnal bunt during the 2000-2001 crop
season. Furthermore, because these counties became regulated areas late
in the crop season, custom harvesters operating in those counties could
not have been aware that they were harvesting crops that may have
tested positive for Karnal bunt. Therefore, in this interim rule, we
are providing for the payment of compensation to custom harvesters who
harvested Karnal bunt-positive host crops in Archer, Baylor,
Throckmorton, and Young Counties, TX, during the 2000-2001 crop season.
This compensation is intended to reimburse custom harvesters for the
cost of cleaning and disinfecting their mechanized harvesting
equipment. We are also providing for the payment of compensation
equivalent to the value of one contract that an eligible custom
harvester lost due to the downtime necessitated by cleaning and
disinfection. If an eligible custom harvester did not lose a contract
due to this downtime, we are providing compensation for the fixed costs
he or she incurred during the time the machine was being cleaned and
disinfected. We are also providing for the payment of compensation for
the expenses associated with the cleaning and disinfection of other
types of equipment used in the four affected counties. The specific
provisions of these compensation provisions are discussed below.
Note: Although the regulations in Sec. 301.89-12 at the time
specifically required that mechanized harvesting equipment be
cleaned and disinfected after it has been used to harvest Karnal
bunt-positive host crops prior to movement from a regulated area,
during the 2000-2001 crop season equipment was allowed to move out
of the regulated counties without disinfection if the inspector who
issued the PPQ-540 certificate allowing such movement determined
that cleaning alone was sufficient to remove all Karnal bunt spores.
We have since amended the regulations in Sec. 301.89-12 to require
disinfection only if it is determined to be necessary by an
inspector [see 69 FR 8091-8097, Docket No. 02-056-2, published
February 23, 2004]. Therefore, custom harvesters seeking
compensation under the regulations established by this interim rule
will be required to present a copy of the PPQ-540 certificate
allowing the movement of equipment from an area regulated for Karnal
bunt, but they will not be required to present proof that their
equipment was both cleaned and disinfected.
In all cases, claims for the compensation provided for by this
interim rule must be received by APHIS on or before September 2, 2004.
The Administrator may extend this deadline upon written request in
specific cases, when unusual and unforeseen circumstances occur that
prevent or hinder a claimant from requesting compensation on or before
this date. If comments we receive in response to this interim rule
cause us to change the rule, we will provide an additional 120-day
period after the effective date of the final rule during which affected
persons may submit claims for compensation.
Cleaning and Disinfection of Mechanized Harvesting Equipment
During the 2000-2001 crop season, the regulations in Sec. 301.89-
12(a) required that mechanized harvesting equipment that has been used
to harvest host crops that test positive for Karnal bunt must be
cleaned and disinfected in accordance with Sec. 301.89-13(a) prior to
movement from a regulated area. (As noted previously, Sec. 301.89-12
has since been amended.) In Sec. 301.89-13, paragraph (a) described
four acceptable methods for cleaning and disinfection.
APHIS has estimated that cleaning and disinfection costs for
mechanized custom harvesting equipment are typically $750 per
harvesting machine. Therefore, under this interim rule, custom
harvesters who harvested Karnal bunt-positive host crops in Archer,
Baylor, Throckmorton, or Young Counties during the 2000-2001 crop
season and whose mechanized harvesting equipment was then required to
be cleaned and disinfected will be eligible to receive either
compensation for the actual cost of the cleaning and
[[Page 24911]]
disinfection or $750 per harvesting machine cleaned, whichever amount
is lower.
To receive compensation for the cost of cleaning and disinfecting
mechanized harvesting equipment, custom harvesters must provide copies
of a contract or other signed agreement for harvesting in Archer,
Baylor, Throckmorton, or Young County during the 2000-2001 crop season,
signed on a date prior to the designation of the county as a regulated
area for Karnal bunt, or an affidavit stating that the custom harvester
entered into an agreement to harvest in Archer, Baylor, Throckmorton,
or Young County during the 2000-2001 crop season prior to the
designation of the county as a regulated area for Karnal bunt; a copy
of the PPQ-540 certificate issued to allow the movement of mechanized
harvesting equipment from a regulated area after it had been used to
harvest Karnal bunt-positive host crops and had been subsequently
cleaned and disinfected; and a receipt showing the cost of the cleaning
and disinfection. (Throckmorton and Young Counties, TX, were declared
regulated areas in an interim rule effective on June 8, 2001 and
published in the Federal Register on June 14, 2001 [66 FR 32209-32210,
Docket No. 01-058-1]; Archer and Baylor Counties, TX, were declared
regulated areas in an interim rule effective on July 13, 2001 and
published in the Federal Register on July 19, 2001 [66 FR 37575-37576,
Docket No. 01-063-1].)
Contracts Lost Due to Downtime Necessitated by Cleaning and
Disinfection
The process of cleaning and disinfecting mechanized harvesting
equipment takes approximately 8 hours, meaning that the custom
harvesting equipment is unusable for one workday while it is being
cleaned and disinfected. Custom harvesters typically schedule their
harvesting contracts months in advance. Therefore, the downtime
necessitated by cleaning and disinfecting mechanized harvesting
equipment after it was used to harvest Karnal bunt-positive host crops
in Archer, Baylor, Throckmorton, and Young Counties during the 2000-
2001 crop season caused some custom harvesters to be unable to fulfill
previously scheduled harvesting contracts.
In this interim rule, we are providing for the payment of
compensation to custom harvesters who operated in Archer, Baylor,
Throckmorton, or Young Counties during the 2000-2001 crop season and
whose mechanized harvesting equipment was required to be cleaned and
disinfected for the full value of one contract that was lost due to
downtime necessitated by cleaning and disinfection. Compensation will
only be provided for one contract lost due to cleaning and
disinfection. The maximum value of compensation for this contract is
$23.48 per acre that was to be harvested. This figure is APHIS'
calculation of the average cost per acre of harvesting wheat; it was
derived from data provided by U.S. Custom Harvesters, an industry trade
group. APHIS will pay $23.48 per acre that was to be harvested or the
full value of the contract, whichever is less.
To receive compensation for the value of a contract lost due to
downtime necessitated by cleaning and disinfection, custom harvesters
must provide copies of a contract or other signed agreement for
harvesting in Archer, Baylor, Throckmorton, or Young County during the
2000-2001 crop season, signed on a date prior to the designation of the
county as a regulated area for Karnal bunt, or an affidavit stating
that the custom harvester entered into an agreement to harvest in
Archer, Baylor, Throckmorton, or Young County during the 2000-2001 crop
season prior to the designation of the county as a regulated area for
Karnal bunt; a copy of the PPQ-540 certificate issued to allow the
movement of mechanized harvesting equipment from a regulated area after
it had been used to harvest Karnal bunt-positive host crops and had
been subsequently cleaned and disinfected; and the contract for
harvesting in an area not regulated for Karnal bunt that was lost due
to downtime necessitated by cleaning and disinfection of mechanized
harvesting equipment, signed on a date prior to the designation of the
relevant county as a regulated area for Karnal bunt, for which the
custom harvester will receive compensation.
Compensation for Fixed Costs Incurred During Cleaning and Disinfection
Custom harvesters who did not lose contracts due to downtime
necessitated by cleaning and disinfection nevertheless had to pay fixed
costs associated with custom harvesting while their equipment was being
cleaned and disinfected; they could not recoup these costs by using
their equipment during this time. Fixed costs associated with custom
harvesting include labor costs, travel costs, insurance, telephone and
utility costs, and interest. According to U.S. Custom Harvesters, such
fixed costs typically total $250 per hour. Custom harvesters whose
mechanized harvesting equipment was required to be cleaned and
disinfected thus typically incurred $2,000 in unavoidable fixed costs
because their equipment was idle for 8 hours. Therefore, we are
providing for the payment of $2,000 in compensation to each custom
harvester who harvested Karnal bunt-positive host crops in Archer,
Baylor, Throckmorton, and Young Counties during the 2000-2001 crop
season and who does not apply for compensation for a contract lost due
to time lost to cleaning and disinfection. This compensation will
ensure that all custom harvesters are compensated for economic losses
associated with the cleaning and disinfection of their equipment.
To receive compensation for fixed costs incurred during cleaning
and disinfection, custom harvesters must provide copies of a contract
or other signed agreement for harvesting in Archer, Baylor,
Throckmorton, or Young County during the 2000-2001 crop season, signed
on a date prior to the designation of the county as a regulated area
for Karnal bunt, or an affidavit stating that the custom harvester
entered into an agreement to harvest in Archer, Baylor, Throckmorton,
or Young County during the 2000-2001 crop season prior to the
designation of the county as a regulated area for Karnal bunt; and a
copy of the PPQ-540 certificate issued to allow the movement of
mechanized harvesting equipment from a regulated area after it had been
used to harvest Karnal bunt-positive host crops and had been
subsequently cleaned and disinfected.
In the event that a custom harvester who harvested Karnal bunt-
positive host crops in Archer, Baylor, Throckmorton, or Young County
during the 2000-2001 crop season had to cancel a contract due to time
lost to cleaning and disinfection that was valued at less than $2,000,
that custom harvester may request the compensation for fixed costs
incurred during cleaning and disinfection and receive $2,000 under this
interim rule. Because the compensation for fixed costs does not address
the variable costs that must be accounted for in the total cost of a
contract, we believe that this situation is extremely unlikely to have
occurred; in fact, APHIS currently estimates the average value of
contracts lost due to downtime necessitated by cleaning and
disinfection at $25,000. However, we believe it would not encourage
participation in the Karnal bunt eradication program if we required
that a custom harvester with documented losses of under $2,000 due to
cleaning and disinfection receive less compensation than a custom
harvester without documented losses receives as
[[Page 24912]]
a generic valuation of his or her fixed costs.
Cleaning and Disinfection of Other Equipment
During the 2000-2001 crop season, Sec. 301.89-12 of the
regulations required that mechanized harvesting equipment that had been
used to harvest host crops that test positive for Karnal bunt and seed
conditioning equipment that had been used in the production of any host
crops in a regulated area be cleaned and disinfected in accordance with
Sec. 301.89-13(a) prior to movement from a regulated area. Mechanized
harvesting equipment that has been used to harvest Karnal bunt-positive
host crops and seed conditioning equipment that has been used in the
production of host crops are the only types of equipment required to be
treated prior to movement from a regulated area. However, Sec. 301.89-
6 allows an inspector or a person operating under a compliance
agreement to issue a certificate or limited permit for the movement
within or outside a regulated area of a regulated article if the
inspector determines that the regulated article, among other
possibilities, is to be moved in compliance with any additional
conditions the Administrator may impose to prevent the artificial
spread of Karnal bunt. These additional conditions may include cleaning
and disinfection.
In Archer, Baylor, Throckmorton, and Young Counties during the
2000-2001 crop season, several pieces of equipment other than
mechanized harvesting equipment and seed conditioning equipment that
had come into contact with Karnal bunt-positive wheat were found by
inspectors to require cleaning and disinfection so that they could be
moved from the quarantined area without spreading Karnal bunt. The
owners or lessees of these pieces of equipment had scheduled the
movement of the equipment from the quarantined area prior to the
declaration of these counties as regulated areas and needed to move the
equipment out of the regulated areas to continue their harvesting.
APHIS estimates that these pieces of equipment cost $100 each to clean
and disinfect.
Therefore, we are providing for the payment of compensation in the
amount of $100 for each piece of equipment to owners or lessees of
equipment that was required by an inspector to be cleaned and
disinfected during the 2000-2001 crop season after the equipment came
into contact with Karnal bunt-positive wheat in Archer, Baylor,
Throckmorton, and Young Counties. To receive this compensation, owners
or lessees must submit a copy of the PPQ-540 certificate issued to
allow the movement of the equipment from a regulated area after it had
been in contact with Karnal bunt-positive host crops and had been
subsequently cleaned and disinfected.
We are adding the provisions described above as a new paragraph
Sec. 301.89-16(d), ``Special allowances for custom harvesters and
equipment owners or lessees for costs related to cleaning and
disinfection of mechanized harvesting and other equipment in Archer,
Baylor, Throckmorton, and Young Counties, TX, in the 2000-2001 crop
season.'' This new paragraph describes the circumstances under which
custom harvesters and owners or lessees of equipment that were required
to be cleaned and disinfected may receive compensation and the process
by which they may apply for compensation.
Related Regulatory Action
We plan to initiate rulemaking to amend the regulations to provide
for the payment of similar compensation to custom harvesters who
harvest host crops that test positive for Karnal bunt and owners or
lessees of other equipment that is exposed to host crops that test
positive for Karnal bunt in any areas not previously regulated for
Karnal bunt. That proposed rule, which would apply to the 2002-2003
through 2005-2006 crop seasons, is being prepared, in part, in response
to other comments we received on our May 2002 interim rule.
Immediate Action
Immediate action is necessary to relieve the economic burden placed
on small entities by the domestic quarantine regulations for Karnal
bunt. Under these circumstances, the Administrator has determined that
prior notice and opportunity for public comment are contrary to the
public interest and that there is good cause under 5 U.S.C. 553 for
making this action effective less than 30 days after publication in the
Federal Register.
We will consider comments we receive during the comment period for
this interim rule (see DATES above). After the comment period closes,
we will publish another document in the Federal Register. The document
will include a discussion of any comments we receive and any amendments
we are making to the rule.
Executive Order 12866 and Regulatory Flexibility Act
This rule has been reviewed under Executive Order 12866. The rule
has been determined to be not significant for the purposes of Executive
Order 12866 and, therefore, has not been reviewed by the Office of
Management and Budget.
Karnal bunt is a fungal disease of wheat, durum wheat, and
triticale (a hybrid of wheat and rye). Upon detection of Karnal bunt in
Arizona in March 1996, Federal quarantine and emergency actions were
imposed to prevent the interstate spread of the disease to other wheat
producing areas in the United States. The spread of the disease in the
United States would have significant adverse economic consequences,
since many U.S. wheat export markets require that wheat from the United
States be from areas where Karnal bunt is not known to occur. By
certifying that U.S. wheat is from such areas, APHIS facilitates
exports to some markets that otherwise would likely be closed. It has
been estimated that termination of the certification program would
result in a cumulative reduction of national net farm income of $5.3
billion from 2003 to 2007.
The unexpected discovery of Karnal bunt and subsequent Federal
emergency actions have disrupted the production and marketing flows of
wheat in the quarantined areas, causing economic hardship for a number
of persons.\1\ In order to mitigate that hardship, and to help ensure
full and effective compliance with the quarantine program, the USDA has
offered compensation to certain growers, handlers and others.
Compensation has been offered to mitigate losses incurred in the 1995-
1996, 1996-1997, 1997-1998, and 1999-2000 and subsequent crop seasons.
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\1\ As an example, it was estimated that the impact of Karnal
bunt and subsequent Federal actions on the wheat industry totaled
$44 million in the 1995-1996 crop season, comprised primarily of
losses in the value of wheat and seed.
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This interim rule provides for custom harvesters and other
equipment owners or lessees in Archer, Baylor, Throckmorton, and Young
counties in northern Texas to receive compensation for certain disease-
related losses and expenses that they had not been eligible for under
the previous regulations. Specifically, custom harvesters are offered
compensation for: (1) The cost of required cleaning and disinfection of
mechanized harvesting equipment; and (2) lost harvesting contracts due
to downtime necessitated by cleaning and disinfection of mechanized
harvesting equipment or fixed costs incurred when mechanized harvesting
equipment is idled for required cleaning and disinfection. Compensation
is also offered, in specific cases, for the cost of required cleaning
and disinfection of equipment other than mechanized
[[Page 24913]]
harvesting equipment. Compensation would be offered only in connection
with APHIS-required cleaning and disinfection stemming from the use of
equipment in those four counties in northern Texas during the 2000-2001
crop season.
The four counties named above became regulated for Karnal bunt late
in the 2000-2001 crop season, after much of the wheat in those counties
had already been harvested. Because they had no prior knowledge that
their equipment would be used in a Karnal bunt-infested area, custom
harvesters operating in the four counties during the 2000-2001 crop
season did not have an opportunity to avoid the area.
The compensation provided by this interim rule is designed to
reduce the economic impact of the Karnal bunt regulations on custom
harvesters and other equipment owners and to help obtain cooperation
from affected individuals in efforts to contain and reduce the
prevalence of Karnal bunt. As an alternative, APHIS could elect to make
no changes to the regulations, but that alternative would not encourage
cooperation by custom harvesters and others subject to the cleaning and
disinfection requirements of the regulations and other efforts designed
to prevent the spread of the disease.
Cleaning and Disinfection of Mechanized Harvesting Equipment
The regulations for Karnal bunt in place during the 2000-2001 crop
season required that mechanized harvesting equipment be cleaned and
disinfected prior to being moved from a regulated area if it was used
to harvest Karnal bunt-positive host crops.
This interim rule offers harvesters compensation for the actual
cost of cleaning and disinfection, up to a maximum of $750 per cleaning
and disinfection.\2\
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\2\ The $750 figure is based on data provided by U.S. Custom
Harvesters, a trade group. Harvesters would be eligible to receive
compensation more than once, assuming they otherwise qualify.
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USDA's compensation liability under this aspect of the interim rule
is estimated at $37,500. This estimate assumes 50 machine cleanings (50
combines and associated equipment) at $750 per cleaning.\3\ Although
the estimate is based on 50 combines, fewer than 40 harvesters are
expected to be affected by the interim rule, as some harvesters own
more than one combine.
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\3\ It is estimated that 130 pieces of harvesting equipment
required cleaning--50 combines and 80 pieces of harvesting equipment
other than combines. The 80 pieces of equipment other than combines
were cleaned along with, and at the same time as, the 50 combines.
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Contracts Lost Due to Downtime Necessitated by Cleaning and
Disinfection
Custom harvesters typically negotiate their combining contracts
well in advance of the harvest season. In addition, they set rigorous
schedules for harvesting, so as to get maximum utilization from their
equipment. Contracts are specific for reporting dates at a given
location.
Because cleaning and disinfection delays the movement of their
equipment to a subsequent location under contract, cleaning and
disinfection may cause custom harvesters to default on contracts or to
subcontract with other harvesters to fulfill the contracts. This
interim rule offers custom harvesters compensation for the full value
of one contract lost due to downtime necessitated by cleaning and
disinfection, up to a maximum of $23.48 per acre of land to be
harvested under the contract.\4\ (Custom harvesters would be able to
apply for this compensation or the compensation for downtime costs
discussed above, but not both.)
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\4\ The $23.48 per acre figure represents average harvesting
costs; it is based on data provided by U.S. Custom Harvesters, a
trade group.
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USDA's compensation liability under this aspect of the interim rule
is estimated at $250,000, assuming 10 lost contracts at an average of
$25,000 per contract. No more than 10 harvesters are likely to be
affected.
Compensation for Fixed Costs Incurred During Cleaning and Disinfection
In addition to the cost of cleaning and disinfection itself,
harvesters incur other costs during the time their machines are cleaned
and disinfected. These fixed costs (e.g., for labor, travel, insurance,
telephone, utilities, and interest) are distinct from variable costs
(e.g., for fuel and lubrication). This rule will provide custom
harvesters compensation for fixed costs incurred during cleaning and
disinfection at a rate of $2,000 per machine cleaning. The rate of
$2,000 assumes fixed costs of $250 per hour for 8 hours, the typical
time required for cleaning and disinfection of a combine.\5\
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\5\ Harvesters would be eligible to receive compensation more
than once, assuming they otherwise qualify.
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USDA's compensation liability under this aspect of the interim rule
is estimated at $80,000. This estimate assumes 40 combine cleanings for
which the combines' owners are compensated at $2,000 per cleaning.
Fewer than 30 harvesters are expected to be affected by this aspect of
the interim rule, since some harvesters own more than one combine.
Harvesters would be able to apply for this compensation or the
compensation for lost harvesting contracts discussed above, but not
both. This is why the compensation estimate of $80,000 is based on only
40 combines, 10 fewer than the 50 combines assumed to require cleaning
earlier in this analysis under the heading ``Cleaning and Disinfection
of Mechanized Harvesting Equipment.''
Cleaning and Disinfection of Other Equipment
Under the regulations, owners or lessees of equipment other than
mechanized harvesting equipment may be required to clean and disinfect
their equipment (e.g., hay wagons, balers, grain carts, and trailers)
prior to moving it from a regulated area. This rule offers equipment
owners or lessees compensation for the cost of cleaning and
disinfection, at a rate of $100 per cleaning.\6\
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\6\ Equipment owners or lessees would be eligible to receive
compensation more than once, assuming they otherwise qualify.
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USDA's compensation liability under this aspect of the interim rule
is estimated at $1,000. This estimate assumes compensation for 10
pieces of equipment (10 x $100). No more than 10 owners or lessees are
likely to be affected.
Impact on Small Entities
The Regulatory Flexibility Act requires that agencies consider the
economic effects of their rules on small businesses, organizations, and
governmental jurisdictions. This interim rule affects certain wheat
harvesters and other equipment owners or lessees in northern Texas.
Affected entities will benefit, because the interim rule will allow
them to receive compensation for certain disease-related losses and
expenses that they are not now eligible for under the current
regulations.
Most entities that are affected are likely to be small in size,
when judged by the U.S. Small Business Administration's (SBA)
standards.\7\ Composite data for wheat growers offers an example. In
1997, there were a total of 50,176 U.S. farms in North American
Industry Classification System (NAICS) category 11114, a classification
category comprised of establishments primarily engaged in growing wheat
and/or producing wheat seeds. The per-farm average sales for those
farms that year was $78,260, well below the SBA's small entity
threshold of $750,000 in annual sales for farms in that NAICS
[[Page 24914]]
category.\8\ Affected harvesters are also likely to be small in size.
In 2000, there were 338 firms in NAICS category 115113, classification
comprised of establishments primarily engaged in mechanical harvesting,
picking, and combining of crops. Of the 338 firms, 306, or 91 percent,
had fewer than 20 employees, thus falling below the SBA's small entity
threshold.\9\
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\7\ The overwhelming majority of business entities, in general,
are small under the SBA's standards.
\8\ Source: SBA and 1997 Census of Agriculture (NASS).
\9\ Source: SBA. The SBA's size standard for firms in NAICS
115113 is based on annual sales, not the number of employees.
However, composite sales data for firms in that NAICS category are
not available.
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The interim rule is not expected to have a significant economic
impact on a substantial number of entities, large or small. This is
because no more than about 40 harvesters and equipment owners or
lessees are likely to be affected by the rule. For some harvesters,
especially those whose profit margins are small, the receipt of $25,000
in compensation for a contract lost due to downtime necessitated by
cleaning and disinfection could be considered significant. It is
possible that a small number of harvesters, no more than about 10,
could experience substantial economic benefits from compensation for
lost harvesting contracts, assuming average per-contract compensation
of $25,000.
Under these circumstances, the Administrator of the Animal and
Plant Health Inspection Service has determined that this action will
not have a significant economic impact on a substantial number of small
entities.
Executive Order 12372
This program/activity is listed in the Catalog of Federal Domestic
Assistance under No. 10.025 and is subject to Executive Order 12372,
which requires intergovernmental consultation with State and local
officials. (See 7 CFR part 3015, subpart V.)
Executive Order 12988
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. This rule: (1) Preempts all State and local laws and
regulations that are inconsistent with this rule; (2) has no
retroactive effect; and (3) does not require administrative proceedings
before parties may file suit in court challenging this rule.
Paperwork Reduction Act
In accordance with section 3507(j) of the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.), the information collection and
recordkeeping requirements included in this interim rule have been
submitted for emergency approval to the Office of Management and Budget
(OMB). OMB has assigned control number 0579-0248 to the information
collection and recordkeeping requirements.
We plan to request continuation of that approval for 3 years.
Please send written comments on the 3-year approval request to the
following addresses: (1) Office of Information and Regulatory Affairs,
OMB, Attention: Desk Officer for APHIS, Washington, DC 20503; and (2)
Docket No. 03-052-1, Regulatory Analysis and Development, PPD, APHIS,
Station 3C71, 4700 River Road Unit 118, Riverdale, MD 20737-1238.
Please state that your comments refer to Docket No. 03-052-1 and send
your comments within 60 days of publication of this rule.
This interim rule provides for the payment of compensation to
custom harvesters for losses they incurred due to the requirement that
their equipment be cleaned and disinfected after four counties in
northern Texas were declared regulated areas for Karnal bunt during the
2000-2001 crop season and for the payment of compensation to owners of
other equipment that came into contact with Karnal bunt-positive host
crops in those counties and was required to be cleaned and disinfected
during the 2000-2001 crop season. In order to receive compensation for
the cost of cleaning and disinfection of mechanized harvesting
equipment and for fixed costs incurred during cleaning and
disinfection, custom harvesters must provide copies of a contract or
other signed agreement for harvesting in Archer, Baylor, Throckmorton,
or Young County during the 2000-2001 crop season, signed on a date
prior to the designation of the county as a regulated area for Karnal
bunt, or an affidavit stating that the custom harvester entered into an
agreement to harvest in Archer, Baylor, Throckmorton, or Young County
during the 2000-2001 crop season prior to the designation of the county
as a regulated area for Karnal bunt; a copy of the PPQ-540 certificate
issued to allow the movement of mechanized harvesting equipment from a
regulated area after it had been used to harvest Karnal bunt-positive
host crops and had been subsequently cleaned and disinfected; and a
receipt showing the cost of the cleaning and disinfection. Custom
harvesters seeking compensation for a lost contract must additionally
provide a copy of the contract for which they are seeking compensation.
Owners of other equipment seeking compensation must provide a copy of
the PPQ-540 certificate allowing the movement of the equipment. We are
soliciting comments from the public ( as well as affected agencies)
concerning our information collection and recordkeeping requirements.
These comments will help us:
(1) Evaluate whether the information collection is necessary for
the proper performance of our agency's functions, including whether the
information will have practical utility;
(2) Evaluate the accuracy of our estimate of the burden of the
information collection, including the validity of the methodology and
assumptions used;
(3) Enhance the quality, utility, and clarity of the information to
be collected; and
(4) Minimize the burden of the information collection on those who
are to respond (such as through the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology; e.g., permitting electronic
submission of responses).
Estimate of burden: Public reporting burden for this collection of
information is estimated to average 0.2 hours per response.
Respondents: Custom harvesters, owners of other equipment, lessees
of other equipment.
Estimated annual number of respondents: 40.
Estimated annual number of responses per respondent: 1.
Estimated annual number of responses: 40.
Estimated total annual burden on respondents: 8 hours. (Due to
averaging, the total annual burden hours may not equal the product of
the annual number of responses multiplied by the reporting burden per
response.)
Copies of this information collection can be obtained from Mrs.
Celeste Sickles, APHIS' Information Collection Coordinator, at (301)
734-7477.
Government Paperwork Elimination Act Compliance
The Animal and Plant Health Inspection Service is committed to
compliance with the Government Paperwork Elimination Act (GPEA), which
requires Government agencies in general to provide the public the
option of submitting information or transacting business electronically
to the maximum extent possible. For information pertinent to GPEA
compliance related to this interim rule, please contact Mrs. Celeste
Sickles, APHIS' Information Collection Coordinator, at (301) 734-7477.
List of Subjects in 7 CFR Part 301
Agricultural commodities, Plant diseases and pests, Quarantine,
[[Page 24915]]
Reporting and recordkeeping requirements, Transportation.
0
Accordingly, we are amending 7 CFR part 301 as follows:
PART 301--DOMESTIC QUARANTINE NOTICES
0
1. The authority citation for part 301 continues to read as follows:
Authority: 7 U.S.C. 7701-7772; 7 CFR 2.22, 2.80, and 371.3.
Section 301.75-15 also issued under Sec. 204, Title II, Pub. L.
106-113, 113 Stat. 1501A-293; sections 301.75-15 and 301.75-16 also
issued under Sec. 203, Title II, Pub. L. 106-224, 114 Stat. 400 (7
U.S.C. 1421 note).
0
2. Section 301.89-16 is amended by revising the section title and
adding a new paragraph (d) and an OMB control number citation to read
as follows:
Sec. 301.89-16 Compensation for grain storage facilities, flour
millers, National Survey participants, and certain custom harvesters
and equipment owners or lessees for the 1999-2000 and subsequent crop
seasons.
* * * * *
(d) Special allowances for custom harvesters and equipment owners
or lessees for costs related to cleaning and disinfection of mechanized
harvesting and other equipment in Archer, Baylor, Throckmorton, and
Young Counties, TX, in the 2000-2001 crop season. All claims for
compensation under this paragraph Sec. 301.89-16(d) must be received
by APHIS on or before September 2, 2004. The Administrator may extend
this deadline upon written request in specific cases, when unusual and
unforeseen circumstances occur that prevent or hinder a claimant from
requesting compensation on or before this date. All compensation
payments made under this paragraph Sec. 301.89-16(d) will be issued by
APHIS. Claims for compensation should be sent to Plant Protection and
Quarantine, APHIS, USDA, 304 West Main Street, Olney, TX 76374.
(1) Custom harvesters. (i) Cleaning and disinfection of mechanized
harvesting equipment. Custom harvesters who harvested host crops that
tested positive for Karnal bunt and that were grown in Archer, Baylor,
Throckmorton, or Young Counties, TX, during the 2000-2001 crop season
are eligible to receive compensation for the cost of cleaning and
disinfecting their mechanized harvesting equipment as required by Sec.
301.89-12(a). Compensation for the cost of cleaning and disinfection
mechanized harvesting equipment used to harvest Karnal bunt-positive
host crops will be either the actual cost or $750 per cleaned machine,
whichever is less. To claim compensation, a custom harvester must
provide copies of a contract or other signed agreement for harvesting
in Archer, Baylor, Throckmorton, or Young County during the 2000-2001
crop season, signed on a date prior to the designation of the county as
a regulated area for Karnal bunt, or an affidavit stating that the
custom harvester entered into an agreement to harvest in Archer,
Baylor, Throckmorton, or Young County during the 2000-2001 crop season
prior to the designation of the county as a regulated area for Karnal
bunt; a copy of the PPQ-540 certificate issued to allow the movement of
mechanized harvesting equipment from a regulated area after it had been
used to harvest Karnal bunt-positive host crops and had been
subsequently cleaned and disinfected; and a receipt showing the cost of
the cleaning and disinfection.
(ii) Contracts lost due to cleaning and disinfection. Custom
harvesters who harvested host crops that tested positive for Karnal
bunt and that were grown in Archer, Baylor, Throckmorton, or Young
Counties, TX, during the 2000-2001 crop season are also eligible to be
compensated for the revenue lost if they lost one contract due to
downtime necessitated by cleaning and disinfection, if the contract to
harvest Karnal bunt-positive host crops in a previously nonregulated
area was signed before the area was declared a regulated area for
Karnal bunt. Compensation will only be provided for one contract lost
due to cleaning and disinfection. Compensation for any contract that
was lost due to cleaning and disinfection will be either the full value
of the contract or $23.48 for each acre that was to have been harvested
under the contract, whichever is less. To claim compensation, a custom
harvester must provide copies of a contract or other signed agreement
for harvesting in Archer, Baylor, Throckmorton, or Young County during
the 2000-2001 crop season, signed on a date prior to the designation of
the county as a regulated area for Karnal bunt, or an affidavit stating
that the custom harvester entered into an agreement to harvest in
Archer, Baylor, Throckmorton, or Young County during the 2000-2001 crop
season prior to the designation of the county as a regulated area for
Karnal bunt; a copy of the PPQ-540 certificate issued to allow the
movement of mechanized harvesting equipment from a regulated area after
it had been used to harvest Karnal bunt-positive host crops and had
been subsequently cleaned and disinfected; and the contract for
harvesting in an area not regulated for Karnal bunt that had been lost
due to time lost to cleaning and disinfecting harvesting equipment,
signed on a date prior to the designation of the relevant county as a
regulated area for Karnal bunt, for which the custom harvester will
receive compensation.
(iii) Fixed costs incurred during cleaning and disinfection. Custom
harvesters who harvested host crops that tested positive for Karnal
bunt and that were grown in Archer, Baylor, Throckmorton, or Young
Counties, TX, during the 2000-2001 crop season who do not apply for
compensation for a contract lost due to cleaning and disinfection as
described in paragraph (d)(1)(ii) of this section are eligible for
compensation for fixed costs incurred during cleaning and disinfection.
Compensation for fixed costs incurred during cleaning and disinfection
will be $2,000. To claim compensation, a custom harvester must provide
copies of a contract or other signed agreement for harvesting in
Archer, Baylor, Throckmorton, or Young County during the 2000-2001 crop
season, signed on a date prior to the designation of the county as a
regulated area for Karnal bunt, or an affidavit stating that the custom
harvester entered into an agreement to harvest in Archer, Baylor,
Throckmorton, or Young County during the 2000-2001 crop season prior to
the designation of the county as a regulated area for Karnal bunt; and
a copy of the PPQ-540 certificate issued to allow the movement of
mechanized harvesting equipment from a regulated area after it has been
used to harvest Karnal bunt-positive host crops and has been
subsequently cleaned and disinfected.
(2) Other equipment; cleaning and disinfection. Owners or lessees
of equipment other than mechanized harvesting equipment and seed
conditioning equipment that came into contact with host crops that
tested positive for Karnal bunt in Archer, Baylor, Throckmorton, or
Young Counties, TX, during the 2000-2001 crop season and that was
required by an inspector to be cleaned and disinfected are eligible for
compensation for the cost of cleaning and disinfection. Compensation
for the cleaning and disinfection of such equipment will be $100. To
receive this compensation, owners or lessees must submit a copy of the
PPQ-540 certificate issued to allow the movement of the equipment from
a regulated area after it had been in contact with Karnal bunt-positive
host crops and had been subsequently cleaned and disinfected.
[[Page 24916]]
(Approved by the Office of Management and Budget under control
number 0579-0248.)
Done in Washington, DC, this 29th day of April 2004.
Peter Fernandez,
Acting Administrator, Animal and Plant Health Inspection Service.
[FR Doc. 04-10195 Filed 5-4-04; 8:45 am]
BILLING CODE 3410-34-P