[Federal Register: May 27, 2005 (Volume 70, Number 102)]
[Proposed Rules]
[Page 30647-30651]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr27my05-20]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 966
[Docket No. FV05-966-1 PR]
Tomatoes Grown in Florida; Revisions in Requirements for
Certificates of Privilege
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This rule invites comments on revisions to the Certificate of
Privilege (COP) requirements currently prescribed under the Florida
tomato marketing order (order). The order regulates the handling of
tomatoes grown in Florida and is administered locally by the Florida
Tomato Committee (Committee). This rule
[[Page 30648]]
would require those interested in receiving Florida tomatoes shipped
under a COP to apply to the Committee to become an approved receiver.
This rule would also clarify the definitions for processing and
pickling as used in the rules and regulations under the order. These
changes would assist the Committee in assuring that COP tomatoes are
disposed of into COP outlets.
DATES: Comments received by July 26, 2005, will be considered prior to
issuance of a final rule. Pursuant to the Paperwork Reduction Act,
comments on the information collection burden must be received by July
26, 2005.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposal. Comments must be sent to the Docket Clerk,
Marketing Order Administration Branch, Fruit and Vegetable Programs,
AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Washington, DC
20250-0237; Fax: (202) 720-8938, or E-mail: moab.docketclerk@usda.gov;
or Internet: http://www.regulations.gov. 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, or can be
viewed at: http://www.ams.usda.gov/fv/moab.html.
FOR FURTHER INFORMATION CONTACT: William G. Pimental, Southeast
Marketing Field Office, Marketing Order Administration Branch, Fruit
and Vegetable Programs, AMS, USDA, 799 Overlook Drive, Suite A, Winter
Haven, Florida 33884-1671; Telephone: (863) 324-3375; Fax: (863) 325-
8793; or George Kelhart, Technical Advisor, Marketing Order
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400
Independence Avenue SW., STOP 0237, Washington, DC 20250-0237;
Telephone: (202) 720-2491; Fax: (202) 720-8938.
Small businesses may request information on complying with this
regulation by contacting Jay Guerber, Marketing Order Administration
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence
Avenue SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-
2491; Fax: (202) 720-8938; or E-mail: Jay.Guerber@usda.gov.
SUPPLEMENTARY INFORMATION: This proposal is issued under Marketing
Agreement No. 125 and Marketing Order No. 966, both as amended (7 CFR
part 966), regulating the handling of tomatoes grown in Florida,
hereinafter referred to as the ``order.'' The order is effective under
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 (USDA) is issuing this rule in
conformance with Executive Order 12866.
This proposal has been reviewed under Executive Order 12988, Civil
Justice Reform. This rule is not intended to have retroactive effect.
This proposal 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 USDA 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 USDA would rule on the 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 USDA's ruling on the petition,
provided an action is filed not later than 20 days after the date of
the entry of the ruling.
This rule would revise the COP requirements currently prescribed
under the order. This action would require all parties interested in
receiving Florida tomatoes shipped under a COP to apply to the
Committee to become an approved receiver. This change would assist the
Committee in preventing tomatoes shipped under a COP from entering
unauthorized outlets. This rule would also clarify the definitions for
processing and pickling as used in the rules and regulations under the
order. The Committee unanimously recommended these changes at a meeting
held on September 9, 2004.
Section 966.54 of the order provides authority for the
modification, suspension, and termination of regulations to facilitate
the handling of tomatoes for special purposes such as export, charity,
processing, or other purposes as specified by the Committee and
approved by USDA. Section 966.56 of the order provides authority for
the application of adequate safeguards to prevent tomatoes handled
pursuant to Sec. 966.54 from entering channels of trade for other than
the specified purpose or purposes. Sections 966.120-123 of the order's
rules and regulations specify the provisions required under a COP to
allow tomatoes for pickling, processing, charity, relief, export, or
experimental purposes to be shipped free from certain order
requirements. The COP procedures include safeguards to ensure that the
tomatoes are shipped for these purposes. The safeguards are also
highlighted in Sec. 966.323(c). Section 966.323(g) provides the
definition of processing.
This rule would add a new Sec. 966.124 to the order's rules and
regulations. This section would require that handlers could only ship
tomatoes under a COP to receivers approved by the Committee and would
outline the receiver application procedures. Section 966.323(c) would
also be modified to reflect the new COP requirements.
The COP provisions allow tomatoes for pickling, processing,
charity, relief, export, or experimental purposes to be shipped free
from certain order requirements. Consequently, it is important that
adequate safeguards exist to assure that such tomatoes are disposed of
properly. For example, the Committee noted that tomatoes shipped during
the 2003-04 season under a COP for processing were being shipped into
the domestic fresh market and not for the intended COP purpose.
The volume of tomatoes shipped for processing under COPs is
significant enough to negatively impact the market for fresh tomatoes
if these tomatoes are utilized in markets other than those specified in
the COP. Last season, nearly 500,000 25-pound equivalent units of
Florida tomatoes were shipped under COPs. Consequently, the Committee
agreed that additional steps need to be taken to ensure that tomatoes
shipped under a COP are only utilized for the purposes specified.
Last season, when the issue with COP tomatoes surfaced, the
Committee staff looked for ways to address the problem. Using the
current safeguard procedures, those handlers who had shipped to
receivers that had used tomatoes shipped under a COP for purposes
different than specified had their COPs canceled. Some handlers noted
that they had shipped the tomatoes to their receiver in good faith, and
that the receiver was responsible for the problem. Further, because the
handlers had used COPs to ship to more than one receiver, those
handlers affected were no longer able to take advantage of the
exemptions provided under the COP provisions.
Considering this, the Committee believes one way to help ensure
that tomatoes shipped under a COP are not being misused is to provide
for
[[Page 30649]]
safeguards on receivers. To address the situation, the Committee
recommended that all receivers interested in receiving tomatoes shipped
under a COP be required to apply to the Committee to become an approved
receiver. In addition, handlers would only be able to ship under a COP
to those approved receivers.
Should a receiver utilize the tomatoes for purposes other than
specified under the COP, their status as an approved receiver with the
Committee would be rescinded. As a result, such a receiver would no
longer be eligible to receive tomatoes from any handler under a COP,
but would only be able to receive tomatoes meeting the existing grade
and size requirements under the order.
Under the provisions that would be added by this rule, anyone
interested in receiving tomatoes under a COP would have to file an
application with the Committee for review and approval. This would
include persons acquiring tomatoes for processing or pickling, as well
as tomatoes acquired for relief or charity, for export, for
experimental purposes, or for other purposes specified by the
Committee. This application would include the name, address, telephone
number, and e-mail address of applicant (receiver), the purpose for
which the COP tomatoes would be used, physical address where the stated
privilege purpose would be accomplished, an indication of whether or
not the receiver packs, repacks, or sells fresh tomatoes, a statement
that the tomatoes obtained would only be used for the purposes stated
in the COP, a statement agreeing to undergo random inspections by the
Committee, and an agreement to submit reports as required. The
Committee believes that this additional information would be valuable
in helping to verify legitimate receivers.
The Committee staff would use the information in the application to
investigate and approve receivers wanting to receive tomatoes under
COPs. The approved receivers and the tomatoes shipped under the COP
provisions would be monitored throughout the year. If during the season
an approved receiver is found to be handling tomatoes in ways other
than specified under the COP, that receiver's approval would be
rescinded. The Committee believes this change would help it better
assure that COP tomatoes were shipped into the intended COP outlets.
Moreover, handlers who may have shipped to non-compliant receivers
would still be able to ship to other approved COP receivers.
This rule also would amend the definition for processing contained
in Sec. 966.323 and would add a definition for pickling. Over the past
few years, there have been an increasing number of questions
surrounding what constitutes a fresh product and what constitutes
processing. To help reduce any confusion and to ensure uniformity, the
Committee believes it is important to make the definitions for
processing and pickling in the order's rules and regulations as clear
as possible.
Currently, processing is defined as the manufacture of any tomato
product which has been converted into juice, or preserved by any
commercial process, including canning, dehydrating, drying, and the
addition of chemical substances. This rule would amend this definition
to specify further that all processing procedures must result in a
product that does not require refrigeration until opened.
In addition to the changes to the definition for processing, a
specific definition for pickling would also be added. Pickling would be
defined as tomatoes preserved in a brine or vinegar solution. These
clarifications should lessen the chance of confusion between handlers
and purchasers regarding tomatoes covered under a COP.
The Committee believes this rule would strengthen the existing
safeguard provisions and would help deter the use of Florida COP
tomatoes for unauthorized purposes. By requiring persons who wish to
receive tomatoes under COPs to apply to the Committee to become
approved receivers, the Committee would have additional information
regarding receivers and the ability to rescind their approved receiver
status, if necessary. The Committee also believes enhancing the
definitions for processed and pickled tomatoes would help further
clarify the appropriate uses of tomatoes shipped under a COP.
Therefore, the Committee voted unanimously to make these changes.
Initial Regulatory Flexibility Analysis
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, AMS has
prepared this initial regulatory flexibility analysis.
The purpose of the RFA is to fit regulatory actions to the scale of
business subject to such actions in order that small businesses will
not be unduly or disproportionately burdened. Marketing orders issued
pursuant to the Act, and rules issued thereunder, are unique in that
they are brought about through group action of essentially small
entities acting on their own behalf. Thus, both statutes have small
entity orientation and compatibility.
There are approximately 100 producers of tomatoes in the production
area and approximately 80 handlers subject to regulation under the
marketing order. Small agricultural producers are defined by the Small
Business Administration (SBA) as those having annual receipts less than
$750,000, and small agricultural service firms are defined as those
whose annual receipts are less than $6,000,000 (13 CFR 121.201).
Currently, there are about 20 receivers who obtain tomatoes under COPs.
Based on industry and Committee data, the average annual price for
fresh Florida tomatoes during the 2003-04 season was approximately
$8.04 per 25-pound container, and fresh shipments for the 2003-04
season totaled 57,989,624 25-pound cartons of tomatoes. Committee data
indicates approximately 25 percent of the handlers handle 94 percent of
the total volume shipped outside the regulated area. Based on the
average price, about 75 percent of handlers could be considered small
businesses under SBA's definition. Therefore, the majority of Florida
tomato handlers may be classified as small entities. It is believed
that the majority of Florida tomato receivers and producers may be
classified as small entities.
This rule would revise the COP requirements currently prescribed
under the order. This rule would require those interested in receiving
Florida tomatoes shipped under a COP to apply to the Committee to
become an approved receiver. This change would assist the Committee in
assuring that tomatoes shipped under COPs are used for the intended COP
purposes. This rule would also clarify the definitions for processing
and pickling as used in the rules and regulations under the order.
These clarifications would help reduce confusion between handlers and
purchasers of tomatoes covered under a COP. The Committee unanimously
recommended these changes at a meeting held on September 9, 2004. This
rule would add a new Sec. 966.124 to the rules and regulations, amend
the safeguard provisions specified in Sec. 966.323(c), and revise the
definitions specified in Sec. 966.323(g). Authority for these actions
is provided for in Sec. Sec. 966.54 and 966.56 of the order.
It is not anticipated that these changes would result in any
increased costs for growers, handlers, or receivers who comply with COP
requirements. The Committee recommended these changes to improve
compliance with the provisions established under COPs.
[[Page 30650]]
Because nearly 99 percent of Florida tomato shipments are utilized in
the domestic fresh market, it is important to assure that tomatoes
shipped under COPs are disposed of properly. Adequate safeguards are
needed for this purpose.
This action would have a beneficial impact on producers, handlers,
and receivers in that it would continue to allow approved receivers to
obtain COP tomatoes. Handlers shipping to approved COP receivers also
would benefit because the non-compliant receivers would be removed from
the Committee's approved receiver list and the handler could continue
to take advantage of the exemptions by shipping to other approved COP
receivers. Clarifying the definitions of processing and pickling would
also help alleviate some of the questions and any confusion concerning
what constitutes these procedures. The opportunities and benefits of
this rule are expected to be equally available to all tomato handlers
and growers regardless of their size of operation.
However, requiring receivers to register with the Committee would
impose an additional reporting burden on both small and large
receivers. Requiring receivers to apply annually would increase the
annual burden by five minutes per receiver, for a total burden of 1.67
hours (5 minutes per response x 1 response per receiver x 20
receivers). Although this action would place an additional burden on
receivers of Florida COP tomatoes, the benefits of having the
additional information regarding receivers would outweigh the increase
in reporting burden.
The Committee discussed alternatives to this action. One
alternative considered was to further restrict handlers when shipping
tomatoes under a COP. The Committee recognized that some industry
members have developed markets for these tomatoes, which would
otherwise be discarded. Therefore, the Committee voted to make the
changes in this rule rather than further restricting this outlet.
Another alternative considered was to only require processors and
picklers to apply to the Committee. However, the Committee believed
that the application process should be applicable to all parties
receiving tomatoes under a COP. Consequently, this alternative was
rejected.
USDA has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this proposed rule. As with all Federal
marketing order programs, reports and forms are periodically reviewed
to reduce information requirements and duplication by industry and
public sector agencies.
The Committee's meeting was widely publicized throughout the tomato
industry and all interested persons were invited to attend the meeting
and participate in Committee deliberations. Like all Committee
meetings, the September 9, 2004, meeting was a public meeting and all
entities, both large and small, were able to express their views on
this issue. Finally, interested persons are invited to submit
information on the regulatory and informational impacts of this action
on small businesses.
A small business guide on complying with fruit, vegetable, and
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/fv/moab.html.
Any questions about the compliance
guide should be sent to Jay Guerber at the previously mentioned address
in the FOR FURTHER INFORMATION CONTACT section.
As mentioned previously, this action would require an additional
collection of information. These information collection requirements
are discussed in the following section.
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
3501 et seq.), this notice announces that AMS is seeking approval for a
new form to collect additional information from persons interested in
acquiring tomatoes under a Certificate of Privilege (COP), under
Marketing Order No. 966, Tomatoes Grown in Florida (order). Upon Office
of Management and Budget (OMB) approval, the additional burden will be
merged into the information collection currently approved under OMB No.
0581-0178, Vegetable and Specialty Crops Marketing Orders.
Title: Tomatoes Grown in Florida, Marketing Order No. 966.
OMB Number: 0581-NEW.
Type of Request: New collection.
Abstract: The information collection requirements in this request
are essential to carry out the intent of the Act, to provide the
respondents the type of service they request, and to administer the
Florida tomato marketing order program, which has been operating since
1955.
On September 9, 2004, the Committee unanimously recommended
revising the order's administrative rules and regulations to require
persons wishing to receive Florida tomatoes exempt from certain order
requirements under a COP to register with the Committee annually and
provide information on their facilities. This information would be
reported on form number FTC-111, ``Application for Registration as an
Approved Receiver of Special Purpose Shipments.'' This form would be
filled out by persons wishing to receive tomatoes shipped under a COP,
and would be submitted to the Committee to obtain approval as a
receiver of special purpose shipments. The estimated increase in burden
due to the new form required from each entity annually is 5 minutes per
person, with a total increased burden estimated at 1.67 hours.
The form is needed so the Committee can collect information on
persons wishing to receive shipments of COP tomatoes. The Committee
would evaluate this information and determine whether an entity is
qualified to receive COP tomatoes. This form would help ensure
compliance with the regulations and assist the Committee and the USDA
with oversight and planning.
The information collected would be used only by authorized
representatives of USDA, including AMS, Fruit and Vegetable Programs
regional and headquarters staff, and authorized Committee employees.
Authorized Committee employees would be the primary users of the
information and AMS would be the secondary user.
The request for approval of the revised information collection
under the order is as follows:
Form FTC-111, ``Application for Registration as an Approved
Receiver of Special Purpose Shipments''.
Estimate of Burden: Public reporting burden for this collection of
information is estimated to average 5 minutes per response.
Respondents: Entities who acquire and/or process Florida tomatoes
under a COP annually.
Estimated Number of Respondents: 20.
Estimated Number of Responses per Respondent: 1.
Estimated Total Annual Burden on Respondents: 1.67 hours.
Comments: Comments are invited on: (1) Whether the collection of
information is necessary for the proper performance of the functions of
the agency, including whether the information will have practical
utility; (2) the accuracy of the agency's estimate of the burden of the
collection of information, including the validity of the methodology
and assumptions used; (3) ways to enhance the quality, utility, and
clarity of the information to be collected; and (4) ways to minimize
the burden of the collection of information on those who are to
respond, including the use of appropriate automated, electronic,
mechanical, or other
[[Page 30651]]
technological collection techniques or other forms of information
technology.
Comments should reference OMB No. 0581-NEW and the Florida tomato
marketing order, and be sent to USDA in care of the Docket Clerk at the
previously mentioned address. All comments received will be available
for public inspection during regular business hours at the same
address.
All responses to this notice will be summarized and included in the
request for OMB approval. All comments will become a matter of public
record.
In addition to the information collection burden, this rule also
invites comments on revising the regulations concerning the COP
requirements. A 60-day comment period is provided to allow interested
persons to respond to this proposal. All written comments timely
received will be considered prior to finalization of this rule.
List of Subjects in 7 CFR Part 966
Marketing agreements, Reporting and recordkeeping requirements,
Tomatoes.
For the reasons set forth in the preamble, 7 CFR part 966 is
proposed to be amended as follows:
PART 966--TOMATOES GROWN IN FLORIDA
1. The authority citation for 7 CFR part 966 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. In Part 966, a new Sec. 966.124 is added to read as follows:
Sec. 966.124 Approved receiver.
(a) Approved receiver. Any person who desires to acquire, as an
approved receiver, tomatoes for purposes as set forth in Sec.
966.120(a), shall annually, prior thereto, file an application with the
committee on a form approved by it, which shall contain, but not be
limited to, the following information:
(1) Name, address, contact person, telephone number, and e-mail
address of applicant;
(2) Purpose of shipment;
(3) Physical address of where manufacturing or other specified
purpose is to occur;
(4) Whether or not the receiver packs, repacks or sells fresh
tomatoes;
(5) A statement that the tomatoes obtained exempt from the fresh
tomato regulations will not be resold or transferred for resale,
directly or indirectly, but will be used only for the purpose specified
in the corresponding certificate of privilege;
(6) A statement agreeing to undergo random inspection by the
committee;
(7) A statement agreeing to submit such reports as is required by
the committee.
(b) The committee, or its duly authorized agents, shall give prompt
consideration to each application for an approved receiver and shall
determine whether the application is approved or disapproved and notify
the applicant accordingly.
(c) The committee, or its duly authorized agents, may rescind a
person's approved receiver status upon proof satisfactory that such a
receiver has handled tomatoes contrary to the provisions established
under the Certificate of Privilege. Such action rescinding approved
receiver status shall apply to and not exceed a reasonable period of
time as determined by the committee or its duly authorized agents. Any
person who has been denied as an approved receiver or who has had their
approved receiver status rescinded, may appeal to the committee for
reconsideration. Such an appeal shall be made in writing.
3. In Sec. 966.323, a new paragraph (c)(5) is added and paragraph
(g) is amended by removing the last three sentences and adding five new
sentences in their place to read as follows:
Sec. 966.323 Handling regulations.
* * * * *
(c)* * *
(5) Make shipments only to those who have qualified with the
committee as approved receivers.
* * * * *
(g)* * *Processing as used in Sec. Sec. 966.120 and 966.323 means
the manufacture of any tomato product which has been converted into
juice, or preserved by any commercial process, including canning,
dehydrating, drying, and the addition of chemical substances. Further,
all processing procedures must result in a product that does not
require refrigeration until opened. Pickling as used in Sec. Sec.
966.120 and 966.323 means to preserve tomatoes in a brine or vinegar
solution. U.S. tomato standards means the revised United States
Standards for Fresh Tomatoes (7 CFR 51.1855 through 51.1877), effective
October 1, 1991, as amended, or variations thereof specified in this
section. Other terms in this section shall have the same meaning as
when used in Marketing Agreement No. 125, as amended, and this part,
and the U.S. tomato standards.
Dated: May 20, 2005.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 05-10468 Filed 5-26-05; 8:45 am]
BILLING CODE 3410-02-P