[Federal Register: January 24, 2005 (Volume 70, Number 14)]
[Proposed Rules]
[Page 3313-3315]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24ja05-9]
========================================================================
Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
========================================================================
[[Page 3313]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Parts 945
[Docket No. FV05-945-1 PR]
Irish Potatoes Grown in Certain Designated Counties in Idaho, and
Malheur County, OR; Relaxation of Handling Regulations
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: This proposed rule would relax the minimum size requirement
for U.S. No. 2 grade round potatoes handled under the marketing order
for Idaho-Eastern Oregon potatoes. The current size requirement for
U.S. No. 2 grade round varieties, other than red, is 2 inches minimum
diameter or 4 ounces minimum weight provided that at least 40 percent
of the potatoes in each lot shall be 5 ounces or heavier. This rule
would establish a minimum size requirement of 1\7/8\ inches minimum
diameter, as is currently in effect for round red varieties, for all
U.S. No. 2 grade round potatoes. This relaxation was unanimously
recommended by the Idaho-Eastern Oregon Potato Committee (Committee),
the agency responsible for local administration of the marketing order
program in the designated production area. This proposed change is
intended to improve the marketing of Idaho-Eastern Oregon potatoes and
increase returns to producers.
DATES: Comments must be received by March 25, 2005.
ADDRESSES: Interested persons are invited to submit written comments
concerning this rule. 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; E-mail: moab.docketclerk@usda.gov; or
Internet: http://www.regulations.gov. Comments should reference the
docket number and the date and page number of this issue of the Federal
Register and will be 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: Barry Broadbent, Marketing Specialist,
Northwest Marketing Field Office, Marketing Order Administration
Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 SW., Third
Avenue, Suite 385, Portland, OR 97204; Telephone: (503) 326-2724, Fax:
(503) 326-7440; or George J. 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 proposed rule is issued under Marketing
Agreement and Marketing Order No. 945, both as amended (7 CFR part
945), regulating the handling of Irish potatoes grown in certain
designated counties in Idaho, and Malheur County, Oregon, 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 proposed rule 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 proposed rule would relax the minimum size requirement for
U.S. No. 2 grade round potatoes handled under the order. The current
requirement for U.S. No. 2 grade round varieties, other than red-
skinned, is 2 inches minimum diameter or 4 ounces minimum weight,
provided that at least 40 percent of the potatoes in each lot shall be
5 ounces or heavier. This rule would establish a minimum size
requirement of 1\7/8\ inches minimum diameter, as is currently in
effect for round red-skinned varieties, for all U.S. No. 2 grade round
potatoes.
Sections 945.51 and 945.52 of the order provide authority for the
establishment and modification of grade, size, quality, and maturity
regulations applicable to the handling of potatoes.
Section 945.341 establishes minimum grade, size, and maturity
requirements for potatoes handled subject to the order. Current
requirements provide that round red-skinned varieties that grade U.S.
No. 2 shall have a minimum diameter of 1\7/8\ inches. All other U.S.
No. 2 grade potatoes are required to meet a 2 inches minimum diameter
or 4 ounce minimum weight requirement, provided that at least 40
percent of the potatoes in each lot shall be 5 ounces or heavier.
Section 945.341 also allows potatoes that are U.S. No. 1 grade to meet
a less stringent size B requirement (1\1/2\ inches minimum and 2\1/4\
inches maximum) as specified in the United States Standards for Grades
of Potatoes (7 CFR 51.1540-51.1566).
At its meeting on November 4, 2004, the Committee unanimously
recommended reducing the minimum size requirement for all varieties of
U.S.
[[Page 3314]]
No. 2 grade round potatoes to 1\7/8\ inches minimum diameter.
Committee members stated that round potato production, particularly
for non-red varieties, has been increasing in recent years and now
makes up a significant percentage of total round potato production. In
the past, red-skinned varieties were essentially the only round
varieties produced within the production area. Some new round varieties
that have been introduced have skin colors such as white, yellow, gold,
purple, blue, and pink.
Committee members believe that it is important that the handling
regulations be changed to recognize the significant increase in the
production of non-red varieties of round potatoes. They believe that
relaxing the minimum size requirement for U.S. No. 2 grade round
potatoes would enable handlers to market a larger portion of the crop
in fresh market outlets and meet the needs of buyers.
According to the Committee, quality assurance is very important to
the industry and to its customers. Providing the public with acceptable
quality produce that is appealing to the consumer on a consistent basis
is necessary to maintain buyer confidence in the marketplace. The
Committee reports that potato size is important to buyers and that
providing the sizes desired is important to promote sales. Buyers have
indicated that the proposed 1\7/8\ inches minimum diameter for all
varieties of round potatoes is a desirable size.
This proposed change is expected to improve the marketing of Idaho-
Eastern Oregon potatoes and increase returns to producers.
This rule would have no impact on potato imports covered by section
608e of the Act.
Initial Regulatory Flexibility Analysis
Pursuant to the 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 52 handlers of Idaho-Eastern Oregon
potatoes who are subject to regulation under the order and about 900
potato producers in the regulated area. Small agricultural service
firms, which include potato handlers, are defined by the Small Business
Administration (13 CFR 121.201) 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 $750,000.
Based on a three-year average fresh potato production of 33,767,000
hundredweight as calculated from Committee records, a three-year
average of producer prices of $5.18 per hundredweight reported by the
National Agricultural Statistics Service, and 900 Idaho-Eastern Oregon
potato producers, the average annual producer revenue is approximately
$194,349. It can be concluded, therefore, that a majority of these
producers would be classified as small entities.
In addition, based on Committee records and 2003-04 f.o.b. shipping
point prices ranging from $4.00 to $28.00 per hundredweight reported by
USDA's Market News Service, most of the Idaho-Eastern Oregon potato
handlers do not ship over $5,000,000 worth of potatoes. In view of the
foregoing, it can be concluded that a majority of the handlers would be
classified as small entities as defined by the SBA.
This proposed rule would establish a minimum size requirement of
1\7/8\ inches minimum diameter, as is currently in effect for round
red-skinned varieties, for all U.S. No. 2 grade round potatoes. The
current size requirement for U.S. No. 2 grade round varieties, other
than red, is 2 inches minimum diameter or 4 ounces minimum weight
provided that at least 40 percent of the potatoes in each lot shall be
5 ounces or heavier.
Committee members believe that it is important that the handling
regulations be changed to recognize the significant increase in the
production of non-red varieties of round potatoes. They believe that
relaxing the minimum size requirement for U.S. No. 2 grade round
potatoes would enable handlers to market a larger portion of the crop
in fresh market outlets and meet the needs of buyers. Buyers have
indicated that the proposed 1\7/8\ inches minimum diameter is a
desirable size. This proposed change is expected to improve the
marketing of Idaho-Eastern Oregon potatoes and increase returns to
producers.
Authority for this proposed rule is provided in Sec. Sec. 945.51
and 945.52 of the order.
At the November 4 meeting, the Committee discussed the impact of
this change on handlers and producers. The proposal is a relaxation of
current regulation and, as such, should either generate a positive
impact or no impact on industry participants. The Committee did not
foresee a situation in which this proposed change would negatively
impact either handlers or producers.
Round type potatoes are produced and handled by only a small
percentage of the industry. The predominant producing regions are
centered around the American Falls, Idaho Falls, and Blackfoot areas of
Idaho. Acreage is approximately 6,000 to 7,000 acres, which represents
only about 2 percent of the production area's 355,000 acres planted to
potatoes in 2004.
Round potato production is increasing within the production area.
Shipments for the 2003-2004 season were approximately 300,000
hundredweight. The Committee estimates that round potato shipments for
the 2004-2005 crop season could approach 800,000 hundredweight. The
Committee reported that one round yellow-skinned variety might account
for 500,000 hundredweight. Through week seventeen of the 2004-2005
season, reported shipments of round potatoes are up 54 percent from the
prior year.
The Committee reported that smaller size round potatoes of good
quality receive premium prices. This contention is consistent with USDA
Market News Service reports. Market News does not report on round type
potatoes in the Idaho-E. Oregon area, but does report on other round
potato producing regions. It would be reasonable to expect price trends
between production areas to move together, given that the regions would
compete with each other for sales in the domestic market.
Relaxing the size requirement would allow producers and handlers of
non-red U.S. No. 2 grade round potatoes to market a greater percentage
of their crop under the order. This should lead to increased total net
returns for those firms. The benefits derived from this rule change are
not expected to be disproportionately greater or less for small
handlers or producers than for larger entities.
The Committee discussed alternatives to this proposed change. One
alternative included making no change at all to the current regulation.
The Committee did not believe this alternative would meet the needs of
buyers or benefit the industry. Another alternative discussed
[[Page 3315]]
was to allow round potatoes to be exempted from regulations under
Certificate of Privilege provisions provided within the order. This
option also was rejected because it would allow lower quality potatoes
to be shipped to the fresh market. Lastly, the Committee considered
further relaxing the size requirement for all round potatoes below the
1\7/8\ inches minimum diameter. The Committee believed that relaxing
the minimum size requirement for U.S. No. 2 round potatoes below 1\7/8\
inches would result in buyer dissatisfaction. Producers and handlers
who wish to ship smaller round potatoes may do so by conforming to the
U.S. No. 1 grade standard.
With only a small amount of the total potato crop in the production
area expected to be affected by relaxing the size requirement, the
Committee believes that the proposed change to relax the size
requirement of non-red-skinned U.S. No. 2 round potatoes to a 1\7/8\
inches minimum diameter would provide the greatest amount of benefit to
the industry with the least amount of cost.
This proposed rule would relax the size requirements under the
marketing order. Accordingly, this action would not impose any
additional reporting or recordkeeping requirements on either small or
large potato handlers and importers. 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 USDA has not identified any relevant Federal rules that
duplicate, overlap, or conflict with this proposed rule. However, as
previously stated, potatoes handled under the order have to meet
certain requirements set forth in the United States Standards for
Potatoes (7 CFR 51.1540-51.1566) issued under the Agricultural
Marketing Act of 1946 (7 CFR part 1621, et seq.). Standards issued
under the Agricultural Marketing Act of 1946 are otherwise voluntary.
Further, the Committee's meeting was widely publicized throughout
the potato industry, and all interested persons were invited to attend
the meeting and participate in Committee deliberations. Like all
Committee meetings, the November 4, 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 the
following Web site: 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.
A 60-day comment period is provided to allow interested persons to
respond to this proposal. All written comments timely received will be
considered before a final determination is made on this matter.
List of Subjects in 7 CFR Part 945
Marketing agreements, Potatoes, Reporting and recordkeeping
requirements.
For the reasons set forth above, 7 CFR part 945 is proposed to be
amended as follows:
PART 945--IRISH POTATOES GROWN IN CERTAIN DESIGNATED COUNTIES IN
IDAHO, AND MALHEUR COUNTY, OREGON
1. The authority citation for 7 CFR part 945 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
Sec. 945.341 [Amended]
2. In Sec. 945.341, paragraph (a)(2)(i), remove the words ``Round
red varieties.'' and add in their place ``Round varieties.''
Dated: January 13, 2005.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 05-1178 Filed 1-21-05; 8:45 am]
BILLING CODE 3410-02-P