[Federal Register: March 16, 2006 (Volume 71, Number 51)]
[Rules and Regulations]
[Page 13685-13706]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr16mr06-11]
[[Page 13685]]
-----------------------------------------------------------------------
Part II
Department of Agriculture
-----------------------------------------------------------------------
Office of Energy Policy and New Uses
-----------------------------------------------------------------------
7 CFR Part 2902
Designation of Biobased Items for Federal Procurement; Final Rule
[[Page 13686]]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Office of Energy Policy and New Uses
7 CFR Part 2902
RIN 0503-AA26
Designation of Biobased Items for Federal Procurement
AGENCY: Office of Energy Policy and New Uses, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The U.S. Department of Agriculture (USDA) is amending 7 CFR
part 2902, Guidelines for Designating Biobased Products for Federal
Procurement, to add six sections to designate the following six items
within which biobased products will be afforded Federal procurement
preference, as provided for under section 9002 of the Farm Security and
Rural Investment Act of 2002: Mobile equipment hydraulic fluids; roof
coatings; water tank coatings; diesel fuel additives; penetrating
lubricants; and bedding, bed linens, and towels. USDA also is
establishing minimum biobased content for each of these items. Once
USDA designates an item, procuring agencies are required generally to
purchase biobased products within these designated items where the
purchase price of the procurement item exceeds $10,000 or where the
quantity of such items or of functionally equivalent items purchased
over the preceding fiscal year equaled $10,000 or more. However, USDA
is deferring the effective date for two items (water tank coatings and
bedding, bed linens, and towels) until such time that more than one
manufacturer of products in these two items is identified. USDA
additionally is revising section 2902.2 to add definitions for
``biodegradability,'' ``EPA-designated recovered content product,'' and
``functional unit'' and section 2902.8 to adopt applicable ASTM
International performance tests to verify biodegradability.
DATES: This rule is effective April 17, 2006. However, as to water tank
coatings and bedding, bed linens, and towels, Federal agencies will not
be required to grant those items a preference until USDA learns of the
availability of two or more manufacturers of products within that item
and announces that availability in a future Federal Register notice.
FOR FURTHER INFORMATION CONTACT: Marvin Duncan, USDA, Office of the
Chief Economist, Office of Energy Policy and New Uses, Room 4059, South
Building, 1400 Independence Avenue SW., MS-3815 Washington, DC 20250-
3815; e-mail: mduncan@oce.usda.gov; phone (202) 401-0461. Information
regarding the Federal Biobased Products Preferred Procurement Program
is available on the Internet at http://www.biobased.oce.usda.gov.
SUPPLEMENTARY INFORMATION: The information presented in this preamble
is organized as follows:
I. Authority
II. Background
III. Discussion of Comments
IV. Regulatory Information
A. Executive Order 12866: Regulatory Planning and Review
B. Regulatory Flexibility Act (RFA)
C. Executive Order 12630: Governmental Actions and Interference
with Constitutionally Protected Property Rights
D. Executive Order 12988: Civil Justice Reform
E. Executive Order 13132: Federalism
F. Unfunded Mandates Reform Act of 1995
G. Executive Order 12372: Intergovernmental Review of Federal
Programs
H. Executive Order 13175: Consultation and Coordination with
Indian Tribal Governments
I. Paperwork Reduction Act
J. Government Paperwork Elimination Act Compliance
I. Authority
These items are designated under the authority of section 9002 of
the Farm Security and Rural Investment Act of 2002 (FSRIA), 7 U.S.C.
8102 (referred to in this document as ``section 9002'').
II. Background
On July 5, 2005, USDA published in the Federal Register (70 FR
38612) a proposed rule to designate the following six items for the
biobased products preferred procurement program: Mobile equipment
hydraulic fluids; roof coatings; \1\ water tank coatings; diesel fuel
additives; penetrating lubricants; and bedding, bed linens, and towels.
USDA has determined that each of these six items meets the necessary
statutory requirements; that they are being produced with biobased
products and that their procurement will carry out the following
objectives of section 9002: To improve demand for biobased products; to
spur development of the industrial base through value-added
agricultural processing and manufacturing in rural communities; and to
enhance the Nation's energy security by substituting biobased products
for products derived from imported oil and natural gas.
---------------------------------------------------------------------------
\1\ At proposal, this item was identified as ``urethane roof
coatings,'' based on the specific formulation of the biobased
product available at that time. USDA believes limiting this item to
urethane-based roof coating is unnecessarily restrictive, especially
in the light of another biobased product that has become available
that is not urethane-based. Therefore, USDA is designating the more
generic ``roof coatings'' as the item for preferred procurement
under this program.
---------------------------------------------------------------------------
When USDA designates by rulemaking an item (a generic grouping of
products) for preferred procurement under the Federal Biobased Products
Preferred Procurement Program (FB4P), manufacturers of all products
under the umbrella of that item that meet the requirements to qualify
for preferred procurement can claim that status for their products. To
qualify for preferred procurement, a product must be within a
designated item and must contain at least the minimum biobased content
if one has been established for the designated item. When the
designation of specific items is finalized, USDA will invite the
manufacturers of these qualifying products to post information on the
product, contacts, and performance testing on its FB4P Web site, http://www.biobased.oce.usda.gov.
Procuring agencies will be able to utilize
this Web site as one tool to determine the availability of qualifying
biobased products under a designated item.
Some of the biobased items designated for preferred procurement may
overlap with products designated under the Environmental Protection
Agency's (EPA) Comprehensive Procurement Guidelines program for
recovered content products. Where that occurs, an EPA-designated
recovered content product (also known as ``recycled content products''
or ``EPA-designated products'') has priority in Federal procurement
over the qualifying biobased product. In situations where USDA believes
there may be an overlap, it plans to ask manufacturers of qualifying
biobased products to provide additional product and performance
information to Federal agencies to assist them in determining whether
the biobased products in question are, or are not, the same products
for the same uses as the recovered content products. This information
will be available on USDA's Web site with its catalog of qualifying
biobased products.
In cases where USDA believes an overlap with EPA-designated
recovered content products may occur, manufacturers will be asked to
indicate the various suggested uses of their product and the
performance standards against which a particular product has been
tested. In addition, depending on the type of biobased product,
manufacturers may also be asked to provide other types of information,
such as whether the product contains petroleum-based components and
whether the product contains recovered
[[Page 13687]]
materials. Federal agencies may also ask manufacturers for information
on a product's biobased content and its profile against environmental
and health measures and life cycle costs (the Building for
Environmental and Economic Sustainability (BEES) analysis or ASTM
Standard D7075 for evaluating and reporting on environmental
performance of biobased products). Such information will permit
agencies to determine whether or not an overlap occurs.
Where a biobased item is used for the same purposes and to meet the
same requirements as an EPA-designated recovered content product, the
Federal agency must purchase the recovered content product. For
example, if a biobased hydraulic fluid is to be used as a fluid in
hydraulic systems and because ``lubricating oils containing re-refined
oil'' has already been designated by EPA for that purpose, then the
Federal agency must purchase the EPA-designated recovered content
product, ``lubricating oils containing re-refined oil.'' If, on the
other hand, that biobased hydraulic fluid is to be used to address
certain environmental or health requirements that the EPA-designated
recovered content product would not meet, then the biobased product
should be given preference, subject to cost, availability, and
performance.
This final rule designates three items for preferred procurement
for which there may be overlap with EPA-designated recovered content
products. These items are: (1) Mobile equipment hydraulic fluids, (2)
roof coatings, and (3) penetrating lubricants. Qualifying products
under these three items may overlap with lubricating oils containing
re-refined oil and recovered content roofing materials, depending on
how these products are to be used.
Since publication of the proposed rule to designate items for the
FB4P, section 9002 was amended by section 943 of the Energy Policy Act
of 2005, Pub. L. 109-58 (Energy Policy Act). Section 943 of the Energy
Policy Act amended the definitions section of FSRIA, 7 U.S.C. 8101, by
adding a definition of ``procuring agency'' that includes both Federal
agencies and ``any person contracting with any Federal agency with
respect to work performed under that contract.'' The amendment also
made Federal contractors, as well as Federal agencies, expressly
subject to the procurement preference provisions of section 9002 of
FSRIA. However, because this program requires agencies to incorporate
the preference for biobased products into procurement specifications,
the statutory amendment makes no substantive change to this program.
USDA intends to further amend the Guidelines to incorporate the new
definition of ``procuring agency'' by publishing a notice of final rule
at a later date.
In making future designations, USDA will continue to conduct market
searches to identify manufacturers of products within items. USDA will
then contact the identified manufacturers to solicit samples of their
products for voluntary submission for biobased content testing and for
the BEES analytical tool. Based on these results, USDA will then
propose new items for designation for preferred procurement.
USDA plans to create and chair an ``interagency council,'' with
membership selected from among Federal stakeholders to the FB4P. USDA
will use this council to provide consultation in identifying the order
of item designation, manufacturers producing and marketing products
that fall within an item proposed for designation, performance
standards used by Federal agencies evaluating products to be procured,
and warranty information used by manufacturers of end user equipment
and other products with regard to biobased products.
Finally, USDA plans to identify approximately 10 items in each
future rulemaking. USDA has developed a preliminary list of items for
future designation. This list is available on the FB4P Web site. While
this list presents an initial prioritization of items for designation,
USDA cannot identify with any certainty which items will be presented
in each of the future rulemakings. Items may be added or dropped and
the information necessary to designate an item may take more time to
obtain than an item lower on the prioritization list.
III. Discussion of Comments
USDA solicited comments on the proposed rule for 60 days ending on
September 6, 2005. USDA received comments from 31 commenters by that
date. The comments were from private citizens, individual companies,
industry organizations, one foreign government, and various Federal
agencies. With few exceptions, the commenters supported the goals of
section 9002 and the designation of the six items. Most of the
commenters, however, had specific questions, concerns, or
recommendations regarding some aspect of the designation of these
items. Several comments related to the process USDA has established for
designating items, and other comments were relevant to the January 11,
2005, Guidelines for Designating Biobased Products for Federal
Procurement.
Several procuring agencies expressed concerns in their comments
that the effect of designating an item for which only one manufacturer
of a biobased product is currently available would result in a sole
source situation that would diminish competition. The two items of
concern are water tank coatings and bedding, bed linens, and towels.
Accordingly, while USDA is designating these items for preferred
procurement, it is deferring specifying the date by which agencies must
give preferred procurement to these two items under this program. For
both items, a preferred procurement effective date will be identified
when two or more manufacturers of products within the item have been
identified. USDA actively seeks additional manufacturers of biobased
products under these two items so that the items can be re-proposed for
preferred procurement quickly.
Specific comments, and the USDA responses to them, are addressed
below.
General Comments
Comment: A number of commenters stated that the Federal Register
notice lacks detail on the names, manufacturers of the products, the
performance tests, and, in the case of bedding, bed linens, and towels,
the names of the biobased fibers, and that the information is not
available on the Web site. Three of the commenters expressed concern
over the lack of technical information in the preamble (e.g., lack of
information on availability, relative price, performance and
performance standards, BEES results, and environmental and public
health benefits of products, as required by section 9002) and on the
Web site and that, without this information, it is not possible to
evaluate the effects of the proposed designations and to ascertain the
technical performance of these products. One commenter stated that the
preamble does not discuss how well the product performs when compared
to what is available as a non-biobased alternative and, if Federal
agencies cannot determine the performance characteristics of biobased
products, they cannot reasonably call for them to be purchased. Another
commenter was concerned that the lack of information on performance
tests could lead to duplication of effort by agencies separately
testing products to determine suitability and conformance with their
specifications.
Response: USDA agrees that the information the commenters are
requesting (names, manufacturers of the products, and performance
tests) is useful and much of it is needed to make
[[Page 13688]]
decisions concerning the purchase of products within a designated item.
Therefore, USDA will provide information on the standards and
performance tests for those products that have been tested for purposes
of designation on its FB4P Web site at the time of publishing future
proposed rules, and will at the same time make that information
available in the proposed rules. However, USDA has reached an agreement
with manufacturers not to publish their names in the Federal Register
when designating items. This agreement was reached to encourage
manufacturers to submit products for testing to support the designation
of an item. Once an item has been designated, the manufacturers of
products within the designated item may elect to post their names and
other contact information on the USDA FB4P Web site. USDA will also
link its Web site to Defense Standardization Program and GSA-related
standards lists used as guidance when procuring products. Instructions
on accessing these lists on USDA's FB4P Web site will be included in
its designation rules.
Further, USDA also will invite and actively encourage manufacturers
of qualifying products within a designated item to post, on USDA's
password-protected Web site, performance standards by which qualifying
products' performances have been evaluated.
Comment: One commenter stated that USDA should encourage
manufacturers to submit all relevant health and environmental data (key
environmental attributes, environmental standards met, etc.) and post
this information on the Web site.
Response: USDA agrees with the commenter that the posting of such
information on the FB4P Web site is important. Among the information
that section 2902.6 of the Guidelines requests manufacturers to post to
the FB4P Web site are environmental and health benefits. Sections
2902.6 and 2902.8 additionally state that manufacturers and vendors are
to provide relevant information to a procuring agency upon the agency's
request concerning product characteristics, life cycle costs, and
environmental and health benefits. Both the BEES analytical tool and
ASTM D7075, which a manufacturer may use in lieu of the BEES analytical
tool, take the environmental and health impacts, as well as other
parameters, of biobased products into account.
USDA is working with manufacturers and vendors to post all this
information on the FB4P Web site before a procuring agency asks for it,
in order to make the preferred program more efficient. Steps USDA has
implemented, or will implement, include: Making direct contact with
submitting companies through email and phone conversations to encourage
completion of product listing; coordinating outreach efforts with
intermediate material producers to encourage participation of their
customer base; conducting targeted outreach with industry and commodity
groups to educate stakeholders on the importance of providing complete
product information; participating in industry conferences and meetings
to educate companies on program benefits and requirements; and
communicating the potential for expanded markets beyond the Federal
government, to include State and local governments, as well as the
general public markets. All of these efforts are intended to educate
the manufacturers and other stakeholders on the benefits of this
program and the need to post this information to make it available to
procurement officials.
Comment: One commenter stated that it is illogical to require
Federal agencies to purchase items, when it is only voluntary for the
vendors to furnish the information for agencies to use in making the
key purchase decision about the items. The commenter stated that the
Web site USDA is developing to contain information on the availability,
relative price, performance, and environmental and public health
benefits of such products will be a useful tool for Federal agencies,
but its efficacy depends on the voluntary submittal of product
information by the manufacturers. The commenter, therefore, recommended
that it be mandatory that manufacturers place relevant information on
the Web site if the manufacturers are to participate in the preferred
procurement program.
Response: USDA agrees that there appears to be an ``illogical''
aspect between ``requiring'' agencies to purchase biobased products
within designated items, while the manufacturers ``voluntarily'' post
on the FB4P Web site information that is needed in making purchasing
decisions. USDA points out that procuring agencies are not required to
purchase products if one of three conditions exist, including the
inability of a product to meet performance standards. If a manufacturer
fails to make this information available to a procuring agency, then
the procuring agency may choose not to purchase the manufacturer's
product. Thus, it is in the best interest of manufacturers and vendors
to make all product performance information available to procuring
agencies, whether through the FB4P Web site or through some other
means.
Comment: Two commenters requested that manufacturers and consumers
be provided with more information on the selection of the proposed
items and the process used to determine which items are likely to be
designated next. One of the commenters stated that the designation
process appears to be somewhat arbitrary and that manufacturers have
little idea as to which products will be designated, how they will be
categorized, or how they will be selected. This commenter stated that
the current proposal provides little information on why USDA selected
these six items, as opposed to other items currently available that
will satisfy the procurement requirements. This commenter believes that
manufacturers and consumers would be better served by a more
transparent process.
The other commenter also stated that the process and criteria for
product designation have not been communicated, which results in
industry and start-up companies not knowing which products will be
selected next for designation. This commenter also stated that there is
very little background or rationale on why these six products were
selected.
Response: USDA agrees that it has not provided enough information
on the selection process used or the order in which USDA intends to
pursue designation. USDA will correct this problem by placing
information on the model used by USDA and its contractor, Iowa State
University, to select items for designation on the FB4P Web site. In
general, the items were developed and prioritized for designation by
evaluating them against program criteria established by USDA and by
gathering information from other government agencies, private industry
groups, and independent manufacturers. These evaluations begin by
asking the following questions about the products within an item:
Are they cost competitive with non-biobased products?
Do they meet industry performance standards?
Are they readily available on the commercial market?
In addition to these primary concerns, USDA then considers the
following points:
Are there manufacturers interested in providing the
necessary test information on products within a particular item?
Are there a number of companies producing biobased
products in this item?
[[Page 13689]]
Are there products available in this item?
What level of difficulty is expected when designating this
item?
Is there a Federal demand for the product?
Are Federal procurement personnel looking for biobased
products?
Will an item create a high demand for biobased feed
stocks?
Does manufacturing of products within this item increase
potential for rural development?
As noted earlier, USDA will also identify the latest set of items
being considered for designation and the order in which USDA plans to
pursue their designation. However, the list may change, with items
being added or dropped, and the order in which items are proposed for
designation is likely to change because the information necessary to
designate an item may take more time to obtain than an item lower on
the list. Further, as noted earlier, USDA plans to create and chair an
interagency council, made up of Federal agencies, to consult with USDA
with respect to identifying the order of items for future designations.
With regard to the comment concerning why these six items were
selected first for designation, the preamble to the proposed rule for
these six items noted that they were selected because ``USDA was able
to expeditiously identify and analyze these items.'' USDA will continue
to make every effort to target those items most used by the Federal
procurement sector. USDA will attempt to follow the model in
prioritizing the order in which items are proposed for designation,
but, to some extent, all future sets of items proposed for designation
will depend on when sufficient information is made available by
manufacturers of products within a designated item.
Comment: One commenter stated that the time frame for designating
these first items has been too long, the process is overly complex and
burdensome, and the paperwork burden required for manufacturers is
unduly burdensome, especially for smaller manufacturers. The commenters
urged USDA to quickly designate other items that will have the greatest
impact on the biobased marketplace and to streamline the designation
process.
A second commenter also stated that the program is taking too long
in its implementation and that additional products with big marketplace
impacts must be designated immediately. The commenter also stated
generally that the implementation seems to be rather complex, time
consuming, and expensive.
Response: USDA agrees that it has taken longer than planned to
propose the first set of items for preferred procurement. Because
information required to designate items is being submitted on a
voluntary basis, USDA is working with manufacturers, as discussed
earlier, to facilitate obtaining the information required to designate
items more quickly.
USDA is also working with manufacturers to facilitate the process
by which items are designated for preferred procurement and is striving
to reduce, where feasible, the cost and burden to manufacturers
associated with designating items. Efforts to accomplish this include,
but are not necessarily limited to, developing a simplified BEES survey
to encourage company input; funding the development of basic production
data for several common agricultural feed stocks; providing assistance
to manufacturers submitting BEES information to support item
designation, including identifying potential sources for questionnaire
data and helping manufacturers calculate specific inputs; contacting
and urging material suppliers to provide necessary life-cycle,
environmental, and human health data not typically maintained by end-
product manufacturers; and considering the potential benefit of
intermediate material BEES analysis as a means of reducing further a
manufacturer's input burden (e.g., a BEES analysis on a biobased
polymer could possibly reduce the burden on manufacturers using that
polymer to produce water bottles, thereby making the bottle
manufacturer only responsible for reporting on their specific process).
In addition to these actions, USDA is covering the costs of both the
biobased content testing and the actual BEES analyses used in the
designation of items.
USDA welcomes suggestions for further reducing the burden to
manufacturers, while providing the level of information necessary to
designate items.
Comment: One commenter stated that USDA should judge the
performance of biobased materials against their intended application
and avoid performance criteria that discriminate against biobased
alternatives. According to the commenter, industry performance criteria
may frequently discriminate against biobased alternatives when such
criteria are designed in the absence of a biobased alternative. The
commenter, therefore, urged USDA to consider alternative criteria when
such discrimination is evident.
Response: USDA agrees with the commenter that the performance of
biobased materials should be judged against their intended applications
and that performance criteria should not be biased against biobased
alternatives. To assist procurement agencies in evaluating products
within designated items against their intended applications, USDA is
providing a forum on its FB4P Web site for manufacturers to publish all
performance standards for their products. USDA will also be providing
information on its Biobased Affirmative Procurement Program (APP),
which is USDA's preferred procurement program. In the APP, USDA will
provide guidance to procuring agencies on how to structure their
preferred procurement program in order to carry out section 2902.4 of
the Guidelines, which requires procuring agencies to reexamine their
performance requirements and specifications to ensure they are not
unfair against the procurement of biobased products and that they are
still necessary and relevant.
Comment: One commenter stated that USDA needs to provide
clarification on how the FB4P will take into account the international
obligations of the U.S. under NAFTA and the World Trade Organization
(WTO) Agreement on Government procurement. Two other commenters stated
that, under NAFTA and the WTO Agreement on Government Procurement, the
treatment of Canadian-sourced goods shall be no less favorable than
that of U.S.-sourced goods and, therefore, no U.S. domestic preference
is permitted. The commenters proposed that USDA cancel the proposed
designation of these items, give preference to goods produced by
signatories of NAFTA and the WTO, or modify the application of the
preference so that it only applies to procurements that fall below the
thresholds of NAFTA and the WTO agreement.
Response: Section 9002 requires Federal agencies to develop
procurement programs that ensure the purchase of designated biobased
products to the maximum extent practicable and that are ``consistent
with applicable provisions of Federal procurement law.'' In making such
purchases, Federal agencies are to give a preference to the procurement
of items ``composed of the highest percentage of biobased products
practicable, consistent with maintaining a satisfactory level of
competition.'' A procurement program that treats biobased products from
designated countries (as that term is defined in the Federal
Acquisition Regulation (FAR) Sec. 25.003)) no less favorably than
U.S.-sourced biobased products: (1) Maintains a preference for biobased
[[Page 13690]]
products over non-biobased products; (2) maintains a satisfactory level
of competition; and (3) ensures consistency with Federal procurement
law, including Part 25 of the FAR. FAR part 25 sets out the policies
and procedures for acquiring foreign products and services and
implements the Buy American Act, trade agreements, and other laws and
regulations regarding the acquisition of foreign products and services.
Accordingly, biobased products from any designated country would
receive the same preference extended to U.S.-sourced biobased products.
In order to clarify and make this policy applicable to all biobased
designations, USDA plans to propose a broad-based revision to the USDA
biobased procurement guidelines (7 CFR part 2902) in its next proposed
rule designating additional items.
Comment: One commenter stated that USDA should explain how it
intends to be sure that biobased products are made from domestic and
not imported feedstocks. The commenter provided an example in which
janitorial cleaners commonly have a linear alcohol ethoxylate
surfactant that can be made from plant or petrol. However, the plant-
derived material is from palm kernel or coconut oil, neither of which
is a U.S. domestic product. Thus, the commenter asked: (1) How will
USDA verify that the organic molecules come from U.S. grown material?
and (2) how will USDA be certain that, when a product can be made from
a U.S. crop, it is indeed being made with a U.S. crop and not imported
material (e.g., D-limonine can come from the U.S., Brazil, and other
citrus growing countries)? The commenter concludes by stating that the
real intent of the law is not being met by the present testing outlined
in the proposed rule.
Response: USDA intends that manufacturers will self-certify that
each product being offered as a biobased product for preferred
procurement contains qualifying feedstock. As noted in the response to
the previous comment, qualifying feedstocks for biobased products can
be from ``designated countries'' as well as from the United States.
Comment: Two commenters stated that USDA should publish its model
Biobased Products Procurement Preference Program so that agencies can
understand the recommended acquisition strategy. One of the commenters
stated that understanding the acquisition strategy is necessary to
enable evaluation of the effects of the proposed designations on
Government procurement processes or general operations.
Response: USDA agrees with the commenters and is continuing to
develop its policies and its Biobased APP for designated items to
support its own procurement practices. USDA is also working to develop
outreach and education programs, based on the USDA Biobased APP, to
assist other procuring agencies in complying with the requirements of
this program. USDA has issued the first generation of its Biobased APP,
which includes several procurement tools, such as sample contract
language for biobased procurement. As additional documents become
available, USDA will publish them to the biobased Web site at http://www.usda.gov/biobased
.
Additionally, USDA will continue to work with OFPP and the Office
of the Federal Environmental Executive (OFEE) to coordinate and
implement Federal biobased procurement policies.
Comment: One commenter urged USDA to work aggressively to bring all
Federal agencies on board to implement the program within the one-year
transition period indicated in the proposed rule.
Another commenter expressed concern that the one-year effective
date may not be adequate, especially where product testing is needed
and in particular for coatings, including roofing system coatings. The
commenter recommended that USDA lengthen the implementation period to
18 months, at least for the first set of designated items, and up to 5
years for product testing and revision of performance specifications.
The commenter pointed to the following as reasons for the need to
extend the implementation period: The timeline for availability clauses
in the FAR that are in development for biobased products; the process
lengthening or even being stopped due to vendor protests, depending on
the language in the FAR; the time for vendors to incorporate biobased
provisions in a logical way, without the pressure to take shortcuts
that could negatively affect agencies; product testing of coatings that
could take several years if the procedures include corrosion or
durability testing; revision of procurement specifications may require
additional years to pass through various reviews and be finalized; and
changes in specifications would lead to new product verifications,
which require money to be allocated through the Planning, Programming,
and Budgeting System process that may take several years.
Response: In response to the first commenter, USDA's Departmental
Administration is working with OFEE and OFPP, and through the
interagency council, to assist all Federal agencies in accomplishing
the goal of implementing the program in a timely manner.
The second commenter expressed concerns about the implementation
period not being long enough. Agencies have one year from the effective
date of the Guidelines to implement procurement preference programs for
designated items. This is consistent with the legislative requirement
found in Section 9002(d) of FSRIA, which states that ``Federal agencies
shall, within one year after the date of publication of applicable
guidelines under subsection (e), or as otherwise specified in such
guidelines, assure that such specifications require the use of biobased
products consistent with the requirements of this section.''
USDA proposed the one-year time frame in the proposed Guidelines
(69 FR 70730, December 19, 2003, proposed section 2902.5), but in the
Guidelines (70 FR 1792, January 11, 2005, section 2902.4(c)), USDA
indicated each designated-item rulemaking would specify the time frame
for each item. In the proposed designated-item rulemaking (70 FR 38612,
July 5, 2005), USDA proposed a one-year time frame for each of the six
items. Once the final rule is published, Federal agencies have up to
one year to comply with these requirements (i.e., revise their
procurement requirements and specifications for implementing the
preferred purchasing of biobased products within these six items).
At the time these items are promulgated for designation, Federal
agencies will have had a minimum of 18 months (from when these
designated items were proposed) up to 27 months (from when the
Guidelines were first proposed and these requirements were first laid
out) available to them to implement these requirements. This time frame
is at minimum equivalent to or longer than that requested by the
commenter for this first set of designated items. It is USDA's position
that this is a sufficient time frame for procuring agencies to identify
biobased items meeting agency performance standards and to take the
actions necessary for incorporating designated items into their
preferred procurement program. USDA also notes that, from the time the
Guidelines were first proposed, agencies will have longer time frames
to implement these requirements for items proposed for designation in
future rulemakings.
In response to the commenter's concerns about the amount of time
required for product testing, USDA reemphasizes that procuring agencies
[[Page 13691]]
are not required to purchase biobased products that do not meet the
reasonable performance requirements of the agency. In cases where
biobased products have not undergone the necessary performance testing
within the one-year implementation period, procuring agencies would not
be expected to purchase the products. USDA will post to its FB4P Web
site information on performance standards against which products have
been tested. In addition, USDA will identify what tests appear to be
relevant and, through working with OFEE and OFPP, what standards
procuring agencies require for a given item. To help manufacturers
conduct performance testing, USDA is making funds available through
section 2902.9 of the Guidelines.
In conclusion and for these reasons, USDA continues to believe that
a one-year effective date for the implementation of the procurement
preference for the items designated in this final rulemaking is
reasonable and is not extending the time frame for these requirements.
Comment: One commenter pointed out that the Federal Register notice
is silent with regard to how Federal agencies should treat existing
contracts, and stated that the cost of terminating contracts would make
the cost for the biobased products unreasonable.
Response: Agencies have one year from the effective date of the
Guidelines to implement procurement preference programs for designated
items and the products within those designated items. Therefore,
agencies should have sufficient time to plan for upcoming procurements.
Agencies are not expected to terminate or modify existing contracts;
however, they are encouraged to add requirements for the purchase of
biobased products when options are exercised, especially to long-term
contracts. This is consistent with other green procurement preference
programs.
Comment: One commenter stated that, because the intent of section
9002 of FSRIA is largely to stimulate the production of new biobased
markets and to energize emerging markets, USDA should establish a
periodic review of biobased product qualification criteria and market
availability of each listed item to determine when they have achieved
market ``maturity.''
Response: USDA believes that the intent of section 9002 is not only
to stimulate new biobased markets, but to maximize the use of biobased
substitutes for petroleum-based products on a continuing basis. Given
this intent, USDA believes it is unnecessary to reevaluate the status
of designated items that have reached market maturity.
Comment: One commenter stated that information on current usage
statistics and specific potential markets for biobased products are
essential to establish a baseline for an annual review of the
effectiveness of agencies' preference programs.
Response: USDA agrees with the comment and, as owner of this
program, is committed to working with OFPP and OFEE in developing a
system, including reporting requirements, to monitor the effectiveness
of the biobased preferred procurement program. Additionally, each
agency is required to develop baselines, as appropriate, and assess the
effectiveness of their individual-based preference procurement program.
Comment: One commenter stated that USDA should add ``number or
dollar value of biobased products purchased'' to the Resource
Conservation and Recovery Act (RCRA) or similar reports as a way to
track FB4P.
Response: To this end, USDA has worked with OFPP and OFEE personnel
to insert biobased data elements into the RCRA Data Call starting in
fiscal year 2005. USDA will continue to work with OFPP and OFEE to
identify methods to collect data on the dollar value of biobased
products purchased.
Comment: One commenter stated that the Federal Register notice does
not provide any information on the enforcement of the rules and on the
possibility of citizen suits against the government. The commenter
explained that punitive measures for noncompliance and the possibility
of citizens' complaints and lawsuits would be problematic for agencies.
Response: Section 9002 does not provide USDA or anyone else with
the authority for the ``enforcement'' of the procurement preference or
for suits against the government by citizens. Without such statutory
authority, USDA cannot add enforcement requirements to the preferred
procurement program. However, OFPP will report to Congress on the
progress, or lack thereof, that agencies are making in purchasing
biobased products. This report could provide an indirect boost in
encouraging procuring agencies to give the necessary preferred
procurement to biobased products.
Further, given the experience of the EPA program under RCRA, which
the language of section 9002 almost completely duplicates, USDA
foresees little likelihood of litigation brought by the public.
Comment: One commenter suggested that USDA clarify whether the
preferred procurement requirement is applicable to just singular high-
dollar amount, agency-wide purchases. (According to the commenter,
there is little incentive to small procuring agencies because they do
not have large-scale purchases.)
Response: The Guidelines were revised to clarify that ``[t]he
$10,000 threshold applies to Federal agencies as a whole rather than to
agency subgroups such as regional offices or subagencies of a larger
Federal department or agency.'' (See section 2902.3(a).) Thus, small
purchases by subagencies are included in the $10,000 cutoff.
Comment: One commenter requested that USDA provide an exception for
``incidental purchases;'' that is, purchases that are incidental to the
purpose of Federal funding. The commenter referred to EPA's original
procurement guidelines (48 FR 4230) and believes the same
interpretation should be made for the biobased products purchasing
program. To illustrate, the commenter stated that, under the incidental
purchases rule, a construction contractor would not have to purchase
biobased hydraulic fluid for use in its equipment because hydraulic
fluid is incidental to the purpose of the construction contract, but
that a contractor maintaining equipment for Federal agencies would be
required to use biobased hydraulic fluids in the maintenance of the
equipment. The commenter, therefore, suggested that USDA provide an
exception for incidental purchases in the final rule.
Response: USDA agrees that ``incidental purchases'' are not covered
by the definition of ``procuring agency.'' The definition of
``procuring agency'' in FSRIA section 9001, as amended by the Energy
Policy Act of 2005, makes it clear that the requirements of section
9002 apply to ``indirect purchases;'' i.e., purchases by contractors.
However, the requirements to purchase biobased products do not apply to
such purchases if they are unrelated to or incidental to the purpose of
the Federal contract. For example, when a construction contractor
purchases hydraulic fluid for maintenance service of construction
equipment being used in the performance of a Federal building
construction contract, that purchase is incidental to the purpose of
the construction contract. The hydraulic fluid purchase would not be
subject to the requirements of section 9002 or the guidelines issued
today, even though some of the monies received under the contract might
be used to finance the purchase.
USDA will propose an amendment to the Guidelines at 7 CFR part 2902
to clarify that incidental purchases are excepted. Agencies may,
however,
[[Page 13692]]
encourage contractors to purchase or test biobased products in order to
further develop markets for these products.
Comment: One commenter stated that USDA should provide definition
or guidance for what constitutes a price that is ``not reasonable''
compared to the cost of a non-biobased product.
Response: It is the responsibility of each procurement agency to
establish, through its policies, cost reasonableness for any products
procured under Federal contract. While the law provides the
``unreasonable price'' exemption, ``unreasonableness'' could be based
on a comparison of product price, life-cycle costs, and other benefit
information. USDA encourages procuring agencies to consider all facets
of a product when evaluating prices.
Additionally, through the FB4P Web site and other initiatives, USDA
will provide as much relevant information as possible to the
individuals responsible for purchasing items and to the program
officials who are developing specifications for the procurement of
products and services. For example, information from the BEES
analytical tool provides information on the first cost of a product and
on the product's life-cycle cost. The BEES results also provide
information on the environmental and health benefits of the products,
which will assist procuring agents in assessing the benefits of a
product when determining the reasonableness of costs. Similar
information will also be provided if the ASTM standard D7075 for
evaluating and reporting on the life-cycle assessment and costs of
biobased products is used.
Comment: One commenter questioned whether Federal agencies will be
expected to provide proof if they determine that biobased alternatives
do not meet established performance standards.
Response: Procuring agencies should follow their procurement rules
and OFPP guidance on buying non-biobased products when biobased
products exist and should document exceptions taken for price,
performance, and availability.
Designation of ``Single Product'' Items and Limited Number of
Manufacturers
Comment: Three commenters expressed concerns regarding the
designation of items for which only one product has been identified or
where a limited number of manufacturers have been identified. The
issues and questions raised by the commenters are as follows:
USDA needs to explain what constitutes a ``sufficient''
number of products to be ``adequate'' for designation and how
sufficient competition can be maintained where only one product is
identified;
Designating single source products would place the
Government, at least initially, in a position of sole source
procurements and it could place the manufacturer in the position of not
being able to meet demand; and
With a limited number of manufacturers of biobased
products, there is a possibility that competition will be limited and
Federal agencies will pay more for biobased alternatives.
Response: USDA agrees that designating items for which there is
only one manufacturer of a biobased product under this item is
problematic for the reasons discussed previously. Of the six biobased
items proposed for designation, two (water tank coatings, and bedding,
bed linens, and towels) are currently known to have a single
manufacturer. USDA believes that the best way to address the problem of
a single-known manufacturer of a biobased product within an item is to
designate that item for preferred procurement, but to defer the
effective date that procurement agencies would be required to give
procurement preference until such time that there are two or more
manufacturers of products within the item. Therefore, USDA is
designating all six items, including items for which there is a single
known manufacturer, but determination of the effective date for the
single source items will be deferred indefinitely. USDA believes that
it is beneficial to proceed with the designation of these two items,
despite the delayed effective date, because it will encourage more
manufacturers to produce products within these two items and alerts
manufacturers of these items to an opportunity to sell their products.
These effects, in turn, further the statutory goals of the program.
With respect to those items for which preferred procurement is
being deferred, USDA will specify the item's effective date in a future
document in the Federal Register when it identifies two or more
manufacturers of products within the item. Until such a document is
published in the Federal Register, USDA will not permit manufacturers
to post product, performance, and contact information on the FB4P Web
site for those items with only one manufacturer. In future proposed
designation rules under the FB4P, USDA intends to propose for
designation only items for which there is more than one manufacturer.
Relationship to Other Federal Programs
Comment: One commenter requested that USDA and EPA work together to
identify items (or products) that may be covered by section 9002 of
FSRIA and by section 6002 (Comprehensive Procurement Guideline) of the
Resource Conservation and Recovery Act, Pub. L. 94-580 (RCRA). The
commenter pointed out that roofing materials, hydraulic fluids, and
penetrating lubricants all may be qualified for procurement preference
under both section 9002 of FSRIA and under section 6002 of RCRA. The
commenter requested that if overlap is identified, USDA work with the
Office of Federal Procurement Policy at the Office of Management and
Budget (OMB), OFEE, and EPA to resolve any conflict.
Another commenter stated that USDA needs to provide additional
clarification on how these two sections relate to each other,
indicating that the language in the Guidelines (section 2902.3(b)) is
vague.
Response: USDA agrees that procurement agents might find themselves
in the position of having to choose between giving procurement
preference to a product that qualifies for preferred procurement under
section 9002 of FSRIA or to a competing product that qualifies for
preferred procurement under section 6002 of RCRA and that guidance is
required. USDA plans on working with the interagency council (discussed
earlier in this preamble) to determine product choices amongst the
various preferred procurement programs for future procurements.
To the extent that products within items designated in this notice
and in future notices under section 9002 of FSRIA are alternatives to
products that are to be given preferred procurement under section 6002
of RCRA, USDA acknowledges that the comprehensive procurement
guidelines under section 6002 of RCRA take precedent. That is,
everything else being equal about a product that qualifies for
preferred procurement under section 9002 of FSRIA and a competing
product that falls under section 6002 of RCRA, a procurement agent
would give preference to section 6002 of RCRA when making a purchase
decision between the two products. USDA believes the language in
section 2902.3(b) is sufficient to determine when section 9002 yields
to section 6002.
However, for performance reasons, a biobased product might be more
appropriate for a given use. USDA offers the following example: If a
procurement agent has the choice of purchasing
[[Page 13693]]
either an EPA-designated recovered content product (in this case,
lubricating oil containing re-refined oil) for use as a fluid in a
hydraulic system or a competing biobased mobile equipment hydraulic
fluid, where both fluids are used for the same purposes and meet the
same requirements, the procurement agent must give procurement
preference to the EPA-designated recovered content product. If, on the
other hand, a biobased hydraulic fluid can meet certain environmental
or health requirements that the EPA-designating recovered content
product would not meet, then the procuring agent should give purchase
preference to the biobased hydraulic fluid, subject to cost,
availability, and performance.
Additionally, designation of items under this program not only
qualifies the item for a Federal procurement preference, but also makes
biobased products under that item eligible to use the biobased label in
the commercial marketplace, as authorized by FSRIA. USDA currently is
developing the labeling program. Thus, duplicate designation of items
under this program and the RCRA program is not inappropriate.
In conclusion, USDA does not see the need to modify the designation
of items in this notice, even when products within an item would be
subject to both sections. However, USDA has added language in the final
rule for mobile equipment hydraulic fluids, roof coatings, and
penetrating lubricants requesting manufacturers to provide information
to help procuring agents identify overlap between the two programs.
USDA will work with the interagency council to help identify potential
overlap between the two programs in future rules.
Comment: One commenter stated that USDA has not provided sufficient
guidance to avoid potential conflicts in implementing both the biobased
and the Energy Star program for roof coatings. The commenter was
specifically concerned that there is no guidance on biobased content
when one is purchasing Energy Star roofing material and requested that
USDA provide guidance in the final rulemaking, including information on
whether the minimum biobased content changes for Energy Star roofing
material. The commenter recommended that this information be provided
in both the preamble and in the regulatory text.
Response: With the new Energy Star preferred procurement program,
USDA agrees that there might be Energy Star products that procurement
officials now will have to consider alongside biobased products in
their procurements. Roof coatings is an example. USDA has information
on two biobased roof coating products, one of which does not meet the
requirements to qualify for the Energy Star rating and one that does.
Where a product does meet the Energy Star rating, it does not mean,
however, that procurement officials must give preference to Energy Star
products over biobased products. To the extent that procurement
officials have to choose between products under different preferred
procurement programs, procurement officials should look to the FAR part
23 for guidance regarding the relative priority of the various
preference programs. USDA will consider whether it is appropriate to
establish biobased content levels for Energy Star products that differ
from those for non-Energy Star products.
BEES Analysis
Comment: Two commenters requested that BEES analyses be done for
the materials that are to be replaced by the biobased products so that
a meaningful comparison of the impacts can be performed. According to
one commenter, without making such a comparison, USDA cannot claim to
have fully evaluated the extent to which the products proposed for
procurement preference actually contribute to the objectives of section
9002 of FSRIA. Using bedding, bed linens, and towels as an example, the
commenter states that by encouraging Federal procurement of, for
example, towels made of ``unknown'' biobased fibers, cotton may be
displaced; and, without making a comparison of the fossil energy inputs
(i.e., coal, oil, natural gas) needed to grow, harvest, and process
cotton as compared to alternative ``unknown'' biobased fiber, USDA
cannot know that substituting the biobased alternative for cotton will
contribute to reducing national use of imported oil and natural gas,
one of the stated goals.
Response: USDA received similar comments during the development of
the Guidelines, although those comments focused on replacing petroleum-
based products. As noted then, USDA agrees that it would be quite
useful to be able to make a point-by-point comparison, using the same
standards of measure, between a biobased and a non-biobased product
prior to making a procurement decision. USDA also agrees that it would
be quite useful to make a comparison between a biobased product given
preferred procurement and a cotton or wool product that might not be
purchased. However, under section 9002, USDA has neither the authority
to require, nor the funding for, testing of non-biobased or other
products that do not qualify for preferred procurement.
Further, USDA does not believe such a comparison would make any
difference in the implementation of the FB4P. The purpose of the FB4P
is to open new markets for new emerging biobased products. It is
possible that, in achieving this purpose for some of the designated
items, biobased products may displace some products that are not
qualifying biobased products (such as cotton shirts), as indicated by
the commenter.
Comment: One commenter suggested that USDA reconsider the candidate
biobased product in any case where it does not compare on an equal or
better basis to existing products on key attributes, such as fossil
fuel depletion or on the overall BEES score.
Response: The purpose of the BEES analysis is to provide
information to procuring agencies to make informed decisions among
biobased products within a designated item, not to disqualify biobased
products from a designated item. The commenter is suggesting USDA use
the overall BEES score for determining whether or not a product can be
afforded preferred procurement over an existing product that scores
better when analyzed using BEES. The criteria used by USDA to designate
items (groups of products) are identified in FSRIA. The overall BEES
score is not one of those criteria. Therefore, USDA declines the
commenter's request.
Comment: Two commenters recommended that the BEES input data be
verified by an independent party. One commenter stated that USDA
appears to have relied solely on product manufacturers to supply the
basic data from which the BEES score is derived, and does not appear to
have performed an independent verification. The other commenter
inquired as to how the quality of the data inputs to the BEES life
cycle assessment tool were assessed.
Response: The commenters are correct in that USDA has not verified
the information submitted by the manufacturers on the products
submitted for the BEES analysis. That information was, and will
continue to be, provided directly to a third party for analysis.
The quality of data submitted to the BEES analytical tool should be
consistent with relevant and applicable ASTM or other industry test
standards. In addition, USDA contractors, when requested, assist
manufacturers in preparing the data to be submitted to the BEES
analytical tool. Those running the BEES analytical tool are certified
by the
[[Page 13694]]
International Organization for Standardization (ISO) (i.e., they are
ISO-certified). As such, they provide a check on the reasonableness of
the data submitted. USDA does not otherwise independently verify data
submitted by the manufacturers.
Comment: One commenter pointed out that the BEES analysis provides
a general assessment of environmental benefit and does not particularly
focus on fossil fuel use, which is one of the principal goals of
section 9002 of FSRIA. The commenter therefore recommended that
consideration be given to modifying the weighting used in the BEES
analysis so that the results will consistently select products that
meet the program objective of substituting biobased products for fossil
energy-based products.
Response: The BEES analytical tool includes ``fossil fuel
depletion'' as one of its metrics. This metric looks at the amount of
fossil fuel consumed in the production of a biobased product. By
looking at this metric's score between products within an item,
procuring agencies can choose those products that use less fossil fuel.
Thus, USDA does not believe it necessary to change the weighting scheme
in the BEES analytical tool to achieve the outcome desired by the
commenter. To help procuring agencies interpret the BEES results, USDA
is coordinating with the National Institute of Standards and Technology
(NIST) to develop additional information concerning the interpretation
and usefulness of BEES scores and will post this information on the
FB4P Web site.
Comment: One commenter expressed concern that the BEES analysis is
inherently limited in that it focuses on the material rather than the
functionality of the material or cost of reapplying the material. For
example, with coatings, BEES takes the life-cycle of the coating
material into consideration, but not the impact of shorter life-cycles
on the asset being protected by the coating. There is no cost
consideration for shorter recoat cycles or impact on users. BEES also
does not attempt to account for cost incurred if the coating, or a
lubricant or hydraulic fluid, does not perform as effectively and the
equipment it is protecting does not last as long.
Response: USDA believes that the BEES analytical tool provides
useful information, even in the areas of concern identified by the
commenter as discussed below, and provides USDA with the information
necessary to assess products within a designated item.
First, with regard to re-applying coatings and the impact to users
of such re-applications, BEES takes into consideration the costs of
``initial investment, replacement, operation, maintenance and repair,
and disposal.'' Included in ``maintenance and repair'' are
consideration of re-applications and the impact to users of such re-
applications.
Second, the commenter states that BEES does not take into account
the ``functionality'' of the product (i.e., whether it performs as
effectively as a non-biobased product when used as directed). However,
the effectiveness of a biobased product is determined using industry
performance standards. Further, USDA is neither using the BEES
analytical tool as a method to determine the effectiveness of a product
nor to promote a product as being effective because it has been
subjected to BEES.
Third, the commenter states that BEES does not take into account
the shorter life-cycles on the asset (i.e., the equipment it is
protecting does not last as long) being protected by the coating. The
functional unit for products takes into account products used in
different amounts in ``equivalent service.'' By equating comparisons of
products to ``equivalent service,'' there is no shortening of life-
cycles for the asset being coated. Thus, if a biobased coating does not
last as long (i.e., frequency of repainting is higher), the functional
unit accounts for that.
Fourth, the commenter states that there is no cost consideration
for shorter recoat cycles. The functional unit developed under the BEES
analysis accomplishes the goal of ``unitizing'' different recoating
cycles by incorporating a time frame. For example, if differences in
the useful lives of alternative products have been identified, the
functional unit will include a time dimension to account for the
frequency of product replacement.
Comment: One commenter stated that USDA needs to recognize the
inherent limitations of the BEES analysis in predicting real-world
effects of selection of these products, and should consider
implementing a follow-up effort to gather performance information based
on use of these products.
Response: USDA acknowledges that BEES, and any other similar
analytical tool, will have certain inherent limitations in predicting
real-world effects. For the biobased preferred procurement program, the
goal of the BEES analytical tool is to enable comparisons between
products within an item. Given this goal, inaccuracies within any one
metric when compared to real-world effects are of lesser significance
to this program than would be other uses of the results.
NIST, who is responsible for the BEES analytical tool, is striving
to provide the best model possible. While USDA believes NIST should
take the lead in making any and all improvements to the BEES analytical
tool, USDA will work with them by bringing the commenter's concerns to
their attention.
Comment: One commenter stated that the use of BEES is potentially a
barrier to entry into the marketplace because of its cost and
questioned the utility of ``requiring'' a BEES analysis for the
biobased material. The commenter also noted that it is an additional
cost that is not borne by standard petroleum-based products.
Response: A BEES analysis is only required when USDA is obtaining
information for proposing an item for designation for preferred
procurement. As provided for in the Guidelines, USDA will provide some
funding for BEES and performance testing of individual products with
biobased content, with priority being given to products of small and
emerging private business enterprises. This helps offset the cost of
the BEES analysis.
USDA is requiring the BEES analysis on products because it provides
important information on the cost, life-cycle cost, environmental, and
human health impacts of specific products. BEES can be used across a
wide variety of products and provides a means to compare products. The
information it provides will be useful to procuring agencies when
making procurement decisions on biobased products and for determining
whether such products are available at a reasonable cost. The USDA,
thus, considers the BEES analytical tool as an important component in
designating items for preferred procurement.
Once an item has been designated, procuring agencies may request
information from a manufacturer on the environmental and life-cycle
costs of a specific product. In this situation, the manufacturer may
elect to use either BEES or ASTM D7075, which is less expensive than
BEES, to provide this information.
Lastly, USDA concurs with the commenter that the cost of BEES or
the alternative is not also borne by petroleum-based products. However,
the statute does not authorize USDA to require petroleum-based product
manufacturers to provide the same information as is being required of
biobased product manufacturers. The overall purpose of the statute
implementing the preferred procurement program for biobased
[[Page 13695]]
products is to open new markets to new emerging biobased products. In
doing so, it is necessary to develop environmental and life-cycle cost
information to provide procuring agents with additional information
when making their purchasing decisions. USDA believes that the effort
required to obtain this information in exchange for procurement
preference is reasonable.
Comment: One commenter recommended that USDA provide additional
information on how BEES scores are developed and how they should be
interpreted, including a discussion of the key concepts and metrics
such as ``functional unit'' and ``per capita impact'', a discussion on
uncertainties and limits to interpretation, as well as some guidance on
determining significant differences between scores. The commenter
requested this because most users of this information are not likely to
have had extensive experience with life-cycle impact assessment.
A second commenter had similar concerns, stating that publishing
the results of the BEES analysis without a frame of reference or
guidance on how to use this information will only confuse potential
users. Questions that are raised by the current presentation of the
information include: (1) How were the functional units selected?, (2)
How much lower does a score have to be for one product to be better
than another product?, (3) How are these numbers used to make a
procurement decision?, (4) What is the environmental significance of,
for example, for hydraulic fluids, a total environmental score of 2.84
versus 3.22?, and (5) For items with one product, such as water tank
coatings, what does a BEE's total environmental performance of 0.0083
mean?
A third commenter states that simply providing agencies with tables
summarizing BEES analyses does not satisfy the statutory requirement
that USDA provide agencies with information on the public health and
environmental benefits of biobased products. The commenter points out
that the summary tables included in the preamble do not provide useful
information to agencies because the information is not provided in the
context of comparisons with non-biobased goods. Examples of information
that could help make a ``best value'' determination include the absence
of toxic or hazardous constituents that are found in competing non-
biobased products, biodegradability, neutral pH, and whether the
product must be handled as a hazardous or non-hazardous waste at the
end of its useful life. Therefore, the commenter recommends that USDA
provide narrative information and comparative reference points on the
environmental and public health benefits of the designated products.
Response: USDA agrees that most users of the information are likely
not to have had extensive experience with life-cycle impact
assessments. The commenter, therefore, is requesting that USDA include
in the preamble information that addresses how BEES works and how to
use the BEES results. Rather than using the preamble as the tool for
conveying such information, USDA believes the best way is for users to
access the BEES Web site (http://www.bfrl.nist.gov/oae/software/bees.html
) to obtain information about the technical details of and the
interpretations used in the BEES analytical tool.
Minimum Biobased Content
Comment: One commenter was concerned about USDA setting a minimum
biobased content based on a single product within an item. The
commenter pointed to the Competition in Contracting Act, which
prohibits agency requirements based on a particular brand name,
product, or feature of a product peculiar to one manufacturer, unless
it is essential to the Government's requirements. The commenter then
stated that USDA needs to explain why the specified minimum content is
essential to the Government's requirements or lower it so that
additional sources can compete. The commenter then stated that USDA
could revisit the minimum requirements in the future if and when new
sources arise.
Another commenter stated that USDA should not set a minimum
biobased content for an item until a representative number of products
are available, because to do so could hinder other biobased products in
the same product category from achieving the preferential procurement
designation. This commenter recommended that a provisional designation
status could be given until enough data are available on a
representative number of products to set a defensible minimum biobased
content. This commenter also recommended that USDA have a process for
adding future products to an item after it has been designated for
preferred procurement, including a mechanism for reassessing and
changing the minimum biobased content for the item.
Response: USDA agrees that setting the minimum biobased content for
a designated item based on more than one product is in principle
preferable to setting it based on a single product. However, USDA does
not believe that setting a minimum biobased content based on a single
product should stop the Department from designating an item as long as
there are two or more manufacturers of products within the item. As
more information on biobased content on products within an item becomes
available, USDA will consider revising the minimum biobased content as
appropriate for each item through a rulemaking process. Therefore, USDA
is promulgating minimum biobased contents for each of the six items.
Because USDA believes it is preferable to base the minimum biobased
content for an item on more than one product, USDA is taking steps to
identify and test additional products. These steps include contacting
manufacturers directly through email and phone conversations,
conducting outreach to intermediate material producers to encourage
their customers to participate in the program, and participating in
industry conferences and meetings to educate companies on the program's
benefits and the potential for expanded markets beyond the Federal
government. Through these and other efforts, USDA is encouraging the
submission of more products for biobased content testing.
Comment: Two commenters recommended that minimum biobased content
be specified as a range or, if expressed as a single number, as the
lower end of a range that reflects the analytical variability of the
ASTM test method, which is plus or minus 3 percentage points. The
commenters pointed out that by not doing so, even the product used to
define the designated minimum biobased content for that item may itself
not be able to qualify in the future due to no fault of its own.
Response: After reviewing the ASTM method, USDA agrees with the
commenters that the variability within the method needs to be accounted
for in setting the minimum biobased content for a designated item. USDA
believes the clearest way of setting the minimum biobased content is to
provide a single value rather than a range. The variability associated
with the test method is identified as plus or minus 3 percentage
points. Therefore, USDA has revised the proposed minimum biobased
contents for five of the six proposed items in the final rule by
subtracting 3 percentage points from the value proposed. By using this
method, the concern expressed by the commenter that the product used to
set
[[Page 13696]]
the minimum biobased content may fail ``due to no fault of its own'' is
resolved.
The minimum biobased contents for these five items in the final
rule are:
Mobile equipment hydraulic fluids--44 percent;
Roof coatings--20 percent; \2\
---------------------------------------------------------------------------
\2\ With regard to roof tank coatings, USDA had proposed a
minimum biobased content of 62 percent based on a urethane-based
roof coating. Since then, USDA has obtained information on another
biobased roof coating with a biobased content of 23 percent. USDA
believes that, based on these two products, it is reasonable and
appropriate to set the minimum biobased content for this item at 20
percent (23 percent minus the 3 percentage points to account for
test method variability).
---------------------------------------------------------------------------
Water tank coatings--59 percent;
Diesel fuel additives--90 percent; and
Penetrating lubricants--68 percent.
For the sixth designated item (bedding, bed linens, and towels),
the proposed minimum biobased content was 18 percent. This value was
calculated using the tested biobased content of 37 percent for the
qualifying biobased feedstock and multiplying it by the 50/50 blend in
which it is used. After proposal, USDA received additional biobased
content test data showing that the qualifying biobased content of the
product was 28 percent rather than the 37 percent used in developing
the proposed rule. USDA has, therefore, recalculated the minimum
biobased content by using the 28 percent and then removing 3 percentage
points to account for the test method's variability. The resulting 25
percent was then multiplied by 0.5 to account for the 50/50 blend in
the final product. The result is a minimum biobased content of 12.5
percent, which USDA rounded to 12 percent and has used in the final
rule for this designated item.
Comment: One commenter suggested that, in addition to considering
the 3 percent variability, the minimum level be rounded
down to the nearest 5 or 10 percent. The commenter was concerned that
basing the minimum biobased content on a limited number of products, or
in some cases on a single product, could lead to the perception that
Federal agencies are giving unfair competitive advantage to the
manufacturers of those products. To illustrate this point, the
commenter stated that the single product used for roof coatings
immediately has a ``monopoly'' on preferred procurement of biobased
products within that product designation. Thus, by rounding down to the
nearest 5 or 10 percent, the commenter stated that the value would not
be specifically attached to a single product and the product(s) used to
determine the minimum biobased content for the item would not be
adversely affected by the designated minimum content requirement for
that item. Also, rounding down would avoid logical legal arguments of
Federal agencies providing a specific product or manufacture with an
unfair competitive advantage. This commenter recommended minimum
biobased content levels for each of the six proposed items as follows:
Mobile equipment hydraulic fluids--20%
Roof coatings--55%
Water tank coatings--55%
Diesel fuel additives--90%
Penetrating lubricants--20% (or 65%)
Bedding, bed linens, and towels--15%
Response: As noted in the previous response, USDA agrees that it is
appropriate to take the variability of the test method into account and
reduce the minimum biobased contents accordingly. Because, as discussed
previously in this preamble, USDA is deferring the effective date for
preferred procurement for items with only one manufacturer identified,
it is unnecessary to reduce further the minimum biobased content by
rounding down to the nearest 5 to 10 percent value in order to separate
the value from any one manufacturer.
Comment: One commenter recommended that the minimum biobased
content level for penetrating lubricants be lowered so as not to
exclude the product that contains 26 percent biobased content. The
commenter acknowledged that excluding the 26 percent product would not
necessarily work contrary to the stimulus directive of the statute, but
the commenter preferred to let the marketplace drive the increased
biobased content for the item. The commenter noted that if USDA finds
that the suggested 20 percent value for penetrating lubricants is not
warranted, then a minimum of 65 percent is recommended based on the
precision limitations.
Response: USDA agrees with the commenter about the desirability of
letting the marketplace drive the use of higher biobased content
products within an item. To that effect, USDA believes that it is
reasonable to set minimum biobased content requirements higher than the
lowest biobased content identified when (1) there are no known
technical reasons to differentiate the product with the lowest biobased
content from those with higher biobased content; and (2) the minimum
biobased content of that product is sufficiently lower than the group
of minimum biobased contents of the other tested products that the
product can be viewed as an ``outlier.'' This is the case for
penetrating lubricants. First, USDA found no technical reason to
differentiate this product from those with the higher biobased
contents. Second, the biobased content of this product is 26 percent
compared to the other four products' biobased content of 71 percent or
higher. USDA believes that this large difference (26 versus the next
lowest content of 71 percent) qualifies the product as an ``outlier.''
Therefore, USDA is basing the minimum biobased content for penetrating
lubricants on the product with the 71 percent biobased content. As
discussed in previous responses, this value was lowered to 68 percent
in the final rule to account for test method precision and was not
rounded down to the nearest 5 or 10 percentage level (i.e., to 65
percent).
Biodegradability
Comment: Eight commenters supported including the use of ASTM
biodegradability standards and three of the commenters recommended
specific revisions for incorporating the ``percent biodegradation,''
``within a certain timeframe,'' and ``in a specific disposal
environment'' into the definition of ``biodegradability.'' Two of the
commenters stated that this was needed in order to make the definition
consistent with the ASTM standards on biobased products and to ensure
that manufacturers' claims are consistent with the guidelines developed
by the Federal Trade Commission (FTC), which require that manufacturers
qualify, to the extent necessary, the product's ability to degrade in
the environment where it is customarily disposed and the rate and the
extent of degradation.
Response: USDA believes that, within the context of section 2902,
the definition of biodegradability is appropriate and the requirements
specified in the proposal are sufficient. The FB4P does not relieve in
any way a manufacturer from complying with the FTC guidelines. A
biobased product included in the FB4P must follow the FTC guidelines to
the same extent as any other product. Nothing in the implementation of
the Guidelines for the FB4P or in the designation of items implies
otherwise. Further, it is not USDA's intent to define an acceptable
level of biodegradability for biobased products.
USDA believes that, where manufacturers claim biodegradability as a
feature of their product under the FB4P, such claims should be
supported
[[Page 13697]]
using ASTM methods because it is important to ensure that procurement
agents have access to reliable information regarding the products they
purchase. As with other performance specifications referenced in the
designation of items, there may be numerous test methods or procedures
available as measures of biodegradability. However, because of the
potential impact on the environment, USDA chose to limit the
verification of biodegradability claims to the use of ASTM methods.
Each of the ASTM standards listed in the proposed rule includes the
types of qualifiers (``percent biodegradation,'' ``within a certain
timeframe,'' and ``in a specific disposal environment'') recommended by
the commenter. USDA believes that, rather than incorporating such
qualifiers into the definition of biodegradability, it is appropriate
to require the use of the applicable ASTM standards and then let the
purchasing agents apply their discretion in selecting the product that
best meets their needs.
Comments Related to Specific Designated Items--Mobile Equipment
Hydraulic Fluids
Comment: One commenter stated that the mobile equipment hydraulic
fluids item should be divided into two levels, one for specialized uses
(the 24 percent biobased product), and one for general uses (with a
biobased content of possibly over 80 percent). The commenter stated
that they had conducted ``fairly extensive'' market research in the
product area and found that the majority of ``standard'' use hydraulic
fluids to be in the 90 percentile of biobased content and that the
lower level biobased content products were found in more specialized
applications. The commenter then stated that to ensure the greatest
value to the government and to the environment, the proposed rule
should emphasize the higher level content fluids to minimize the use of
petroleum content.
Response: USDA agrees with the commenter that it is reasonable to
develop two minimum biobased content requirements for this designated
item. However, rather than subdividing the current designated item,
USDA is revising the designated item in the final rule to apply to
general purpose, or standard, mobile equipment hydraulic fluids only.
USDA will ``reserve'' as an item for future designation mobile
equipment hydraulic fluids for high performance, low pour-point
markets. USDA is doing this, in part, because there is only one product
in this newly created designated item and the Department does not have
BEES results for the product.
Based on the data available to it, USDA has determined that the
minimum biobased content should be based on a product with a biobased
content of 47 percent. After the 3 percent adjustment for precision,
the minimum biobased content for this item is 44 percent. Therefore,
USDA is promulgating 44 percent as the minimum biobased content for
mobile equipment hydraulic fluids in general purpose applications.
Comment: Two commenters stated that USDA should include a specific
exemption for hydraulic fluids, penetrating lubes, diesel fuel
additives, and other items that are used in tactical vehicles and
equipment. One of the commenters also stated that biobased hydraulic
fluid should not be required in systems where failure could have
catastrophic results or where high levels of cleanliness are required
(cleanliness maintained below 15 microns) until more operating
experience has been gained with biobased fluids in less critical
applications.
The other commenter stated that it does not believe it is
appropriate to apply the biobased purchasing requirement to tactical
equipment unless the Department of Defense has documented that these
products can meet the performance requirements for such equipment and
are available in sufficient supply to meet domestic and overseas
deployment needs. Therefore, the commenter recommended that USDA revise
the designations of both the hydraulic fluids and the penetrating
lubricants to make clear that they are for non-tactical applications
only.
Response: USDA believes that the situations described by the
commenters are of sufficient concern that it is appropriate to provide
specific exemptions for certain designated items on an item-by-item
basis. Therefore, USDA is exempting from the preferred procurement
program the use of mobile equipment hydraulic fluids, penetrating
lubricants, and diesel fuel additives when used in military equipment
in combat or combat-related missions and for spacecraft systems and
their launch support equipment where failures could have catastrophic
consequences.
Comments Related to Specific Designated Items--Water Tank Coatings
Comment: Two commenters expressed concern over designating water
tank coatings as an item for preferred procurement. One commenter asked
whether the use of biobased water tank coatings had been reviewed by
industry and Government organizations responsible for public water
supplies. This commenter stated that the viability of the biobased
product proposed for coating water storage tanks needs to be adequately
tested and approved by appropriate Government and industry groups
(including obtaining NSF International (NSF) certification) to ensure
that the product will not deteriorate over time and result in
contamination of drinking water supplies. The second commenter stated
that USDA should ensure that NSF-certified products are available
before finalizing the designation of water tank coatings as a biobased
procurement item.
Response: USDA agrees with the commenters that a water tank coating
must be formulated in a manner that meets relevant and appropriate
performance specifications. Therefore, USDA will work with
manufacturers to allow posting of all performance tests on its FB4P Web
site and with the interagency council to understand Federal purchasing.
In designating items for preferred procurement, the statute
requires USDA to consider two items: (1) The availability of the item
and (2) the economic and technologic feasibility of using such items,
including life-cycle costs. USDA considers an item economically and
technologically feasible for designation if products within that item
are being offered and used in the marketplace. USDA does not consider
certification of a product prior to the designation of an item a
prerequisite for designation. Thus, USDA has determined that a water
tank coating product within this designated item exists that meets
these criteria and that this item qualifies for designation for
preferred procurement.
In order for a procurement agent to give preferred procurement to a
biobased water tank coating, the biobased water tank coating must
comply with all relevant performance standards. Many Federal and State
authorities require products that come into contact with drinking water
to be certified to American National Standards Institute/NSF (ANSI/NSF)
Standard 61 by an ANSI accredited certifier. Thus, water tank coatings
would be certified against the (ANSI/NSF) Standard 61, if the coating
is used for potable water.
With regard to the biobased water tank coating used as the basis
for designation water tank coatings as an item eligible for preferred
procurement, the coating in question has been certified against ANSI/
NSF Standard 61. This coating was tested by the Underwriters Laboratory
(UL), which is
[[Page 13698]]
accredited by ANSI to certify drinking water system products and
components to ANSI/NSF Standard 61. Because both certification programs
are accredited by ANSI, the UL's drinking water product certifications
are equivalent to NSF's drinking water product certifications.
Comments Related to Specific Designated Items--Diesel Fuel Additives
Comment: One commenter questioned whether USDA intent for the
``diesel fuel additive'' item was to include biodiesel sold separately
as a fuel additive or to include already-blended fuel such as B20. The
commenter stated that further definition of the item when it is used
strictly as a fuel additive is needed in terms of required properties
and performance characteristics.
Another commenter stated that USDA should clarify that the
designation of diesel fuel additive as a biobased product is not
intended to address the use of biobased diesel when the biodiesel is
used as a blendstock and recommended that section 2903.13 be clarified
that this designation of diesel fuel additives is not intended to
include biodiesel when used for the purposes of extending fuel
supplies.
Response: The item being designated for preferred procurement is
the diesel fuel additive and not the blended biodiesel fuel itself.
USDA believes that as long as the diesel fuel additive itself is
biobased and meets the minimum biobased content, it qualifies as a
biobased product eligible for preferred procurement.
With regard to biodiesel (that is, neat biodiesel, often referred
to as B100), USDA recognizes that the most prevalent use of B100 by far
is to mix it with diesel fuel to create a blended fuel stock (e.g.,
B20). However, USDA does not believe this should preclude biodiesel
(i.e., neat biodiesel), when used as an additive, from being a biobased
product eligible for preferred procurement under this program.
USDA points out that the designation of diesel fuel additive as a
product eligible for preferred procurement in no way affects the
purchase of biodiesel fuel (even neat biodiesel when used as a fuel) as
a means of complying with the Energy Policy Act of 1992 or with
Executive Order 13149.
Comment: Two commenters disagreed with the designation of diesel
fuel additives because they consider biodiesel to be a fuel rather than
a fuel additive. One of the commenters stated they have concerns with
the handling and use of biodiesel as a fuel component. This commenter
also stated that biodiesel fuel blends are physically different in
nature than conventional diesel fuels and as such have different
storage, handling, and use concerns from diesel fuel, and are not
universal drop-in replacement fuels for conventional diesel. Lastly,
this commenter stated that biodiesel is not a true additive and in fuel
industry practices it is not treated as such.
The other commenter pointed out that ASTM standards for biodiesel
are for its use as a fuel and do not address technical or chemical
considerations for using it as an additive. This commenter also noted
that biobased diesel products registered as fuel additives contain only
one percent biodiesel and, therefore, if the Federal agencies purchased
biobased diesel additives, they would not create a notable increase in
market share for biodiesel compared to the markets created through
their fuel purchases.
On the other hand, two commenters supported the designation of
diesel fuel additives. One of the commenters noted that EPA recognizes
biodiesel as both a fuel and a fuel additive and that several
organizations have received fuel additive registrations for biodiesel.
The commenter recommended that USDA clarify that the designation of
diesel fuel additives will not prevent agencies that are currently
using B20 from continuing to use B20 as a means of complying with the
Energy Policy Act of 1992 and Executive Order 13149. The other
commenter pointed to fuel tests to determine fuel lubricity and the
effectiveness of small amounts of biodiesel to achieve large increases
in lubricity and its flexibility in achieving increases in lubricity.
Response: As noted in the previous response, USDA intends for
``diesel fuel additives,'' and not diesel fuels (including biodiesel
fuels), to be afforded preferred procurement. The definition of
``diesel fuel additive'' in the proposed rule essentially defined
biodiesel. USDA believes that definition is the primary cause of
confusion as to what products were intended to be included in the
proposed designated item. In the final rule, USDA has revised the
definition of ``diesel fuel additive'' to make clear what is to be
considered an additive and to make clear that biodiesel fuels are not
part of the definition.
The revised definition contains three parts. The first part defines
``diesel fuel additive'' using the basic definition from EPA's fuel and
fuel additive registration regulation. USDA believes that the
definition of ``additive'' for the purposes of EPA registration is
appropriate for defining ``diesel fuel additives'' under the FB4P
program.
The second part of the revised definition explicitly includes neat
biodiesel (B100) when used as an additive. USDA believes this is useful
to make clear that there are some instances in which purchases of neat
biodiesel qualify as a diesel fuel additive. In those instances where
neat biodiesel is purchased to be used as an additive, it meets the
requirements for a biobased diesel fuel additive within the context of
this designated item. USDA believes that the purchase and use of neat
biodiesel as a fuel, while obviously consistent with the goals of the
FB4P program, are outside the scope of the FB4P program.
The third part of the revised definition explicitly excludes
blended biodiesel fuel, such as B20, and neat biodiesel when used as a
fuel. USDA believes this is also useful to make clear that the purchase
of such fuels does not constitute the purchase of diesel fuel
additives.
USDA believes that the revised definition sufficiently clarifies
the commenters' concern about what is being given preferred procurement
and that blended fuel stocks are not in any way affected by this
designated item.
Comment: One commenter recommended that, if USDA decides to
designate diesel fuel additive, the final guidance include the
following elements: (1) Applicability to non-tactical vehicles and
equipment only, (2) definition of diesel fuel additive, including a
percentage of biodiesel content (e.g., B1, B2, or B5), (3) statement
that the use of B20 fuel to meet the alternative fuel requirements
under the Energy Policy Act of 1992 and Executive Order 13149 satisfies
the requirement to purchase biobased diesel fuel additives, and (4)
resolution of all performance issues, including biodiesel stability
concerns, raised by the Federal agencies in their comments on this
proposed rulemaking.
Response: As noted in a previous response, USDA has agreed to
exclude the preferred purchase requirement for diesel fuel additives
when used in military equipment for combat or combat-related missions.
With regard to the definition of diesel fuel additive, we have
revised the definition to make clear which products fall within the
designated item. The product itself must be used as an additive and, to
qualify for preferred procurement as a biobased product, must have a
biobased content of at least 90 percent. The resulting concentration
once the biobased additive is mixed with the diesel fuel is not
relevant to the determination of whether or not the
[[Page 13699]]
biobased product is to be treated as an additive.
The commenter's third recommendation relates to the interaction
between the biobased preferred procurement program and the Energy
Policy Act of 1992 and Executive Order 13149. USDA does not have the
authority under section 9002 to give procurement preference to motor
vehicle fuels. The purchase of B20 as an alternative fuel under the
Energy Policy Act of 1992 and Executive Order 13149, while consistent
with the overall goals of the FB4P program, would have no effect on a
procuring agency's responsibility to purchase biobased diesel fuel
additives, if they purchase diesel fuel additives. The item designated
for preferred procurement by today's final rule is diesel fuel
additives and not blended diesel fuel. Only if an agency buys a diesel
fuel additive and mixes it with diesel fuel would there be a
requirement that the additive be a biobased product.
With regard to the commenter's request that USDA resolve all
performance issues, including biodiesel stability concerns, USDA has
determined that demonstrating that certain products, such as diesel
fuel additives, have achieved market penetration and are used in
certain applications is a sufficient basis for designating items, and
it is unnecessary for USDA to demonstrate that such products can be
used in all applications prior to designating the item.
Comment: One commenter recommended that any product designated for
preferred procurement in the diesel fuel additive category should have
been tested using ASTM D6751 standards.
Response: USDA agrees with the commenter that, whether used as a
fuel or as an additive, biodiesel should be tested using ASTM D6751 to
ensure its quality. However, USDA points out that, in the final rule,
the diesel fuel additive item not only includes neat biodiesel when
used as a fuel additive, but also ``any substance, other than one
composed solely of carbon and/or hydrogen, that is intentionally added
to diesel fuel.'' In the latter case, ASTM D6751 would not be
appropriate.
Comments Related to Specific Designated Items--Bedding, Bed Linens, and
Towels
Comment: One commenter noted that USDA specifically solicited
comments on the appropriateness of creating this broader item
designation based only on the availability of blankets that are being
produced by one manufacturer using qualifying biobased content at a
relatively low level. The commenter stated that they do not believe
that this is appropriate, maintaining that the credibility of the
biobased preference program is degraded when item categories are
designated for which there are no products commercially available to
the consumer.
Another commenter recommended that the designated item ``bedding,
bed linens, and towels'' should be subdivided because it is too broad.
The commenter recommended that designated items be narrowly focused on
groups of products with similar functions. To illustrate, the commenter
pointed out the diversity of functions within the ``bedding, bed
linens, and towels'' item. According to the commenter, this diversity
could result in differences in composition of the products and the
selection of a ``functional unit'' that is not appropriate for all
products.
Response: Section 9002(e)(1)(A) of FSRIA provides, in part, for the
designation of ``those items which are or can be produced with biobased
products.'' USDA does not interpret this as a carte blanche charge to
assume anything and everything can be made with biobased products and
thus open the entire program to all products the Federal government
procures. Based on conversation with industry, USDA believes in the
instance of towels and bed linens there is sufficient evidence that the
same biobased fibers currently used to manufacture blankets can be
incorporated into bed linens and towels to produce biobased versions of
these products. Today, USDA knows of two biobased fibers that can and/
or are used in these products. One has a biobased content of 28 percent
and the other has a biobased content of 100 percent.
USDA recognizes that the three types of products within this
proposed designated item serve different basic functions. One of the
key factors in achieving these different basic functions is how the
product is woven; that is, the style of weave. For example, is the
product a broad loop or a tight loop? Sheets, for example, would have a
tight weave with no broad loops. While the weaves may vary, USDA
believes the key point for including these products within the same
item is that they are or can be made with the same basic types of
biobased fibers. Furthermore, USDA does not believe it reasonable to
project an outcome that a procuring agency would be put in the position
of buying towels that have a higher biobased content instead of the
blankets with a lower biobased content because towels and blankets have
different performance characteristics.
With regard to the functional unit, the functional unit identified
for the tested product is ``one blanket'' of certain dimensions. As
BEES information is developed on bed linens and towels, USDA will
identify different functional units for these products as appropriate
(e.g., one towel, one sheet). USDA does not believe procuring agencies
would try to compare blankets with towels based on the functional unit
of ``one blanket.''
For these reasons, USDA believes it is reasonable and appropriate
to designate bed linens and towels for preferred procurement and has
decided not to subdivide this item, as requested by the commenter, into
three separate categories.
Comment: Two commenters supported the designation of ``bedding, bed
linens, and towels.'' Three other commenters stated that USDA needs to
provide more information about whether the biobased fibers used in the
``bedding, bed linens, and towels'' designated item meet the
precautions and infection control procedures established by the Centers
for Disease Control (CDC) and, if they do not, the designation should
exclude applications in healthcare facilities. The commenters stated
that more information on the cost and durability of these products is
also needed. One commenter pointed out that if blankets made with
biobased fibers are heavier than those currently used, the cleaning
costs could be significantly increased. One of the commenters also
pointed out the lack of information about what fibers are available for
these uses.
Response: The commenters are seeking a categorical exemption for
these products when used in healthcare facilities if the products do
not meet certain precautionary and infectious disease requirements of
the CDC. USDA will not provide a categorical exemption for these
products when used in specific situations for the four reasons
discussed below.
1. The statutory requirements of FSRIA require USDA to designate
items for preferred procurement and to make available to the
procurement agencies information on the designated items, including
information on the performance characteristics of products offered
within a designated item. It is still the responsibility of the
procurement agent to determine whether a biobased product, or any other
product, meets the performance requirements of the procuring agency for
which the product is being bought and its intended use.
2. The statute requires procuring agencies to give preference to
biobased
[[Page 13700]]
products in designated items, but does not require the agency to
purchase biobased products if one of three conditions exist, one of
which addresses the performance, or lack thereof, of the biobased
product. Specifically, the statute allows a procuring agency not to buy
a biobased product within a designated item if the biobased product
fails to meet the performance standards set forth in the applicable
specifications or fails to meet the reasonable performance standards of
the procuring agencies (see section 9002(c)(2)(B)). For example,
polylactic acid (PLA) fibers currently are not tolerant of high heat
and bleach, and products produced using these PLA fibers are not likely
to meet CDC performance requirements. Thus, procuring agencies, such as
the Veterans Administration, using products that need to meet CDC
performance requirements would not be required, or even expected, to
buy such products. Because the statute already provides the relief
sought by the commenters, there is no need to include such exemptions
in the rule.
3. Providing a categorical exemption could have the effect of
discouraging manufacturers from developing biobased products within a
designated item such as new biobased products that could meet the CDC's
performance requirements, at some point in the future. USDA believes
this would have an unnecessary dampening effect on potential markets
for acceptable biobased products in the future.
4. Finally, USDA urges manufacturers to note the concerns raised by
these commenters and recognize that extra effort on the part of
manufacturers may be necessary to provide procurement agents with
evidence that the manufacturer's products meet the agency's
requirements. This may require manufacturers to test their products
against all applicable standards and requirements for the markets
(e.g., healthcare facilities) in which they wish to market their
products. In addition, because procuring agencies are not required to
purchase biobased products if they fail any one of the criteria that
allow an agency to not purchase a biobased product within a designated
item, USDA is actively working to identify and publicize relevant
performance standards so that manufacturers can understand how to make
their products more desirable. In addition, to make information on the
performance characteristics of biobased products more accessible to the
procuring agencies, USDA is working with manufacturers to post product
performance information on the FB4P Web site or to provide a link to
the manufacturer's Web page where such information can readily be
obtained.
While manufacturers have the responsibility to test their products
against applicable agency performance requirements and specifications,
in order to comply with section 2902.4 of the Guidelines, procuring
agencies will have to reexamine their performance requirements and
specifications to ensure that they are not biased against biobased
products, that they are still necessary and relevant, and that they are
not redundant.
With regards to the commenter's concern about the lack of
information on what fibers are available for bedding, bed linens, and
towels, information, including performance information, would be posted
by the manufacturers of such fibers once the designation of the item
has been finalized. Currently, USDA knows of two biobased fibers
available for these uses.
Comment: One commenter requested clarification on how the biobased
content of fibers is to be determined: Is it based on content mix after
the item is manufactured or on the weight of fibers prior to
manufacturing?
Response: In the example presented by the commenter, the biobased
content is based on the content mix after the item is manufactured;
that is, based on the content mix of the finished product. For bedding,
bed linens, and towels, the biobased content would be calculated based
on the content mix of the blanket, sheet, or towel after it is
manufactured, but the biobased content must be based on qualifying
biobased material. For this item, cotton, wool, linen, and silk are not
qualifying material and would not be used in determining the amount of
biobased material in the finished product.
Unless otherwise specified in the designation of an item, biobased
content of a product within a designated item would be based on the
finished product. USDA will specify the calculation to be used for each
designated item within each rulemaking. For the other five items in
today's rulemaking, the biobased contents are calculated based on the
finished product.
Comment: Two commenters objected to the exclusion of natural fibers
(wool and cotton) from the qualifying feedstocks that can be used in
producing ``bedding, bed linens, and towels.''
One commenter stated that the preferred procurement program
legislation was intended to substitute plant-derived products for
fossil fuel-derived products, not to substitute one set of plant-
derived products for another set of plant-derived products. The
commenter acknowledges that the statute does urge USDA to develop a
program that encourages new biobased products and that the overall
intent was to expand the use of plant matter as an industrial and fuel
material, but not to substitute one type of plant matter with another.
The commenter refers to USDA statements concerning the objectives
of the preferred procurement program to increase the demand for
biobased products, which would in turn increase the demand for many
agricultural products. The commenter then states that it is doubtful
that those who wrote the legislation intended the USDA to develop
programs that resulted in either the substitution of corn-derived
products for cotton or wool products or the preference of synthetic
fibers of any kind over natural fibers.
The commenter, therefore, recommended that either the designation
of ``bedding, bed linens, and towels'' be withdrawn at this time or
USDA abandon its insistence that biobased products are not necessarily
plant-derived products (preferring the latter approach), because
synthetic fibers made from plants should have to compete with natural
fibers without a preference. The commenter noted that, given synthetic
fibers' performance advantages, they could still be attractive even at
a slightly higher price. By making such a change, the commenter
maintained that the rule would focus on substituting synthetic fibers
for petroleum-derived fibers, which was clearly the legislation's
principal objective.
In a similar request, the second commenter wants cotton fiber to be
provided equal consideration as a qualifying biobased material as other
fibers. This commenter agrees that such products as bedding, bed
linens, and towels made with cotton fiber can be considered mature
products. The commenter then points out that these same textiles made
with other natural fiber and most synthetic/man-made fibers (citing
polyester, nylon, polypropylene, synthetic cellulosics, and most
traditional man-made fibers) should also be considered mature products.
The commenter states that to consider these products made from cotton,
wool, and silk as mature products and not mature products when made
with other fibers is an arbitrary distinction that is not justified.
The commenter, therefore, concludes that if other fibers are considered
acceptable biobased materials for this category, then cotton fiber also
should be an acceptable qualifying biobased material. The commenter
recommends that cotton
[[Page 13701]]
fiber be considered a qualifying biobased material if other natural
fibers and man-made fibers that are also mature products are considered
acceptable biobased materials.
A third commenter stated that USDA should establish a much higher
total biobased product content for bedding, bed linens, and towels,
including cotton and wool.
Response: The legislative history of Title IX of FSRIA identified
three primary objectives associated with section 9002:
1. To improve demand for biobased products;
2. To spur development of the industrial base through value-added
agricultural processing and manufacturing in rural communities; and
3. To enhance the Nation's energy security by substituting biobased
products for fossil energy-based products derived from imported oil and
natural gas.
In addition, the conference report accompanying FSRIA indicated
that the intent of section 9002 ``is to stimulate the production of new
biobased products and to energize emerging markets for those
products.'' It is in response to this intent that USDA continues to
believe that it is appropriate to exclude mature markets from the
preferred procurement program.
USDA acknowledges that the concerns expressed by the first
commenter may occur; that is, as written, the preferred procurement of
biobased bedding, bed linens, and towels may displace cotton and wool
products with, for example, corn-derived products. To the extent they
do, USDA recognizes that the program is not fully achieving the third
primary objective stated for the program; that is, substituting
biobased products for fossil energy-based products derived from
imported oil and natural gas. Nevertheless, USDA believes that
designating cotton and wool as non-qualifying biobased feedstocks is
appropriate for this designated item because it will encourage other
biobased products to enter this market, stimulating the production of
new biobased products and creating for these new biobased products a
new market. Further, USDA stresses that similar opportunities exist for
new cotton and wool products to enter markets within other designated
items and strongly encourages such manufacturers to seek out these
other opportunities.
With regard to the basis presented by the second commenter that
other materials used to manufacture bedding, bed lines, and towels
should also be considered mature markets, but their materials are not
excluded as being qualifying biobased material, USDA agrees that it is
reasonable and desirable to treat ``mature'' natural or plant-derived
fibers in these products equally. In revisiting this issue, USDA has
decided to add linen and silk as mature fibers that will also be
treated as non-qualifying biobased material for this designated item.
Both linen and silk are natural fibers that have been in widespread use
for many years and their use in products within this designated item
are considered to be equal to that of cotton and wool in terms of their
being ``mature'' materials. While linen was not specifically addressed
along with cotton, wool, and silk in the Guidelines' discussion of
``mature markets,'' it is one of the oldest known fibers, and the
rationale for excluding cotton, wool, and silk also would apply to
linen. Designating these fibers as ``mature'' and excluding them ``as
qualifying biobased materials'' does not preclude their use in products
that can receive preferred procurement. Products manufactured by
blending qualifying biobased fibers with non-qualifying fibers (cotton,
wool, linen, or silk) will be eligible for preferred procurement if the
qualifying biobased fibers make up 12 percent or more of the final
product.
Lastly, the third commenter requested that USDA set a higher
minimum biobased content that included consideration of cotton and
wool. For the reasons stated above, USDA has not changed its position
on the inclusion of cotton and wool and, therefore, USDA has not
changed the basis on which it has established the minimum biobased
content for this designated item.
Comment: One commenter suggested that any final designation should
clearly indicate which biobased fibers are included rather than
designating only by exclusion. The commenter stated that understanding
what specific fibers are included would allow for better assessment of
environmental benefits, cost, and health-based issues, such as possible
allergic reactions.
Response: USDA believes that it is more appropriate to identify
those materials that are excluded in a designated item rather than
those that are included. First, the intent of the preferred procurement
program is to encourage new markets for biobased products. This means
that one expects that new biobased materials would be used to develop
biobased products in this item. USDA has no way to forecast what those
new biobased materials would be and thus simply cannot develop a list
of materials to be included as qualifying materials. The only option is
to identify those materials that are excluded. Second, materials that
are being excluded are those that were ``mature'' in 1972. This is a
finite set of materials that USDA can identify. For these reasons, the
USDA identifies in the final designation those materials to be excluded
as qualifying biobased materials.
Comment: One commenter noted that the life-cycle costs were
computed based on a blanket weighing 4 pounds, but no information on
the initial cost of the blanket was provided to allow the commenter to
compare to what they currently pay for blankets. The commenter also
noted that where there is a greater difference in blanket weight (the
commenter typically uses blankets that weigh 2.5 to 3 pounds), the
biobased substitute could potentially add more than $40,000 to cleaning
costs per year at any one of the commenter's hospitals.
Response: The initial cost of the tested biobased blanket is
$139.99, which was identified in Table 6 to the preamble under ``first
cost.''
The blanket tested for biobased content weighed 4 pounds. USDA
expects that manufacturers of biobased blankets will be able to provide
blankets of less weight to meet the commenter's needs.
Finally, the commenter may find that the cost of purchasing
biobased blankets is unreasonable and, as allowed under section 9002,
would not be required to purchase such blankets.
Comment: One commenter expressed concern that the future voluntary
labeling program could result in an organic cotton or wool bedspread
not being able to carry the U.S.D.A. Certified Biobased Product label,
but a corn- or wood-derived bedspread would be able to carry this
label. The commenter stated that such an outcome would create
widespread consumer confusion and result in people seeing the label,
not as one signifying that the product is derived from plants, but that
it is a synthetic fiber rather than a natural fiber.
Response: USDA appreciates the concern expressed by the commenter
and will address this concern in the development of the proposed
voluntary labeling program rule.
Comment: One commenter requested USDA to include cotton fiber when
used to make other than mature textile products and cotton by-products
and cottonseed oil, protein, and refining by-products when used to make
biobased items as qualifying biobased materials for those biobased
items afforded Federal procurement preference. The
[[Page 13702]]
commenter, for example, pointed out that cottonseed oil and refining
by-products can be used to make hydraulic fluids and diesel fuel
additives, and that cottonseed protein can be used to make roof
coatings and water tank coatings.
Response: The rule, as proposed and as promulgated, does what the
commenter is requesting; that is, cotton by-products and cottonseed
oil, protein, and refining by-products when used to make biobased items
are qualifying biobased materials, and cotton fiber when used to make a
product other than mature textile products is a qualifying biobased
material. As USDA designates additional items for preferred
procurement, USDA will make determinations of whether mature markets
existed in 1972 and, if so, identify those materials that do not
qualify as biobased material. Unless a material is specifically
identified as a material not qualifying as a biobased feedstock, such
as cotton fiber has been for bedding, bed linens, and towels, the
material may be used in any designated item and will be considered a
qualifying biobased feedstock. Therefore, USDA does not see the need to
revise the rule to address the commenter's request because the rule
already accommodates the request.
Warranties and Performance Specifications
Comment: One commenter noted that the preamble does not address the
issue of maintenance warranties and asked whether manufacturers of
equipment in which biobased hydraulic fluids or diesel fuel additives
are used have agreed, or will agree, to specifically state that use of
these products will not void maintenance warranties.
Response: As time and resources allow, USDA will work with
manufacturers on the issue of maintenance warranties. At this time,
however, USDA does not have information available as to whether or not
the manufacturers will state that the use of these products will void
maintenance warranties. As information is available on warranties, USDA
will make such information available on its FB4P Web site.
USDA encourages manufacturers to test their products against all
relevant standards, including those that would affect maintenance
warranties, and to work with original equipment manufacturers (OEMs) to
ensure that the biobased products will not void maintenance warranties
when used. USDA is willing to assist manufacturers of the biobased
products, if they find that existing performance standards for
maintenance warranties (or any other aspect) are not relevant or
appropriate for biobased products, in working with the appropriate OEMs
to develop tests that are relevant and appropriate for the end uses in
which the biobased products are intended.
In spite of these efforts, if there is insufficient information
regarding the performance of a biobased product, including its effect
on equipment maintenance warranties where applicable, USDA notes that
the procurement agent would not be required to buy such a product.
Designation of Materials Other Than Products
Comment: Two commenters recommended that, because plastic products
contain colorants, additives, resins, and other materials, USDA create
a list of approved raw materials for plastic products. If a list of
approved raw materials were created, manufacturers could use that list
to create products that would be approved for procurement preference.
Response: Under section 9002 of FSRIA, USDA is required to
designate ``products,'' not raw materials, for preferred procurement.
Section 9001 of FSRIA defines ``biobased products'' as ``a product
determined by the Secretary to be a commercial or industrial product
(other than food or feed) that is composed, in whole or in significant
part, of biological products or renewable domestic agricultural
materials * * * or forestry materials.'' Based on this definition of
``biobased products,'' USDA does not believe it has the statutory
authority to designate ``raw materials'' for preferred procurement.
Therefore, USDA will not create a list of approved raw materials for
plastic products or any other biobased product that is designated for
preferred procurement.
Comment: Two commenters requested that USDA designate qualifying
feedstocks (fibers, resins, and other inputs) rather than, or in
addition to, individual items manufactured from biobased intermediates.
One of the commenters stated that this was particularly important with
the extension of the FB4P to Federal contractors (as required by the
recently enacted Energy Policy Act of 2005), because businesses that
contract with Federal agencies to produce finished products would be
subject to the FB4P requirements.
Response: USDA previously considered extending preferred
procurement designation to feedstocks in response to industry comments
as USDA was initially developing this program. USDA determined that the
best policy would be to maintain a much tighter control on the
characteristics of products, such as the environmental and health
effects and biobased content of products that would qualify for
preferred procurement through the process of designation item by item.
By opening the designation process up to feedstocks, a wider
variability of product characteristics would result. Therefore, USDA
considers it to be undesirable to open the preferred procurement
program to feedstock groupings and has not done so.
IV. Regulatory Information
A. Executive Order 12866: Regulatory Planning and Review
Executive Order 12866 requires agencies to determine whether a
regulatory action is ``significant.'' The Order defines a ``significant
regulatory action'' as one that is likely to result in a rule that may:
``(1) Have an annual effect on the economy of $100 million or more or
adversely affect, in a material way, the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities; (2) Create a serious inconsistency or otherwise interfere
with an action taken or planned by another agency; (3) Materially alter
the budgetary impact of entitlements, grants, user fees, or loan
programs or the rights and obligations of recipients thereof; or (4)
Raise novel legal or policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in this Executive
Order.''
It has been determined that this rule is not a ``significant
regulatory action'' under the terms of Executive Order 12866. The
annual economic effect associated with this final rule has not been
quantified because the information necessary to estimate the effect
does not exist. As discussed in the preamble to the proposed rule, USDA
made extensive efforts to obtain information on the Federal agencies'
usage of the six designated items. These efforts were largely
unsuccessful. Therefore, attempts to determine the economic impacts of
this rule would necessitate estimating the anticipated market
penetration of biobased products, which would entail many assumptions
and, thus, be of questionable value. Also, the program allows procuring
agencies the option of not purchasing biobased products if the costs
are deemed ``unreasonable.'' Under this program, the determination of
``unreasonable'' costs will be made by individual
[[Page 13703]]
agencies. USDA knows these agencies will consider such factors as
price, life-cycle costs, and environmental benefits in determining
whether the cost of a biobased product is determined to be
``reasonable'' or ``unreasonable.'' However, until the program is
actually implemented by the various agencies, it is impossible to
quantify the impact this option would have on the economic effect of
the rule. Therefore, USDA relied on a qualitative assessment to reach
the judgment that the annual economic effect of the designation of
these six items is less than $100 million, and likely to be
substantially less than $100 million. This judgment was based primarily
on the offsetting nature of the program (an increase in biobased
products purchased with a corresponding decrease in petroleum products
purchased) and, secondarily, on the ability of procuring agencies not
to purchase these items if costs are judged unreasonable, which would
reduce the economic effect.
1. Summary of Impacts
Today's rulemaking is expected to have both positive and negative
impacts to individual businesses, including small businesses. USDA
anticipates that the biobased preferred procurement program will
provide additional opportunities for businesses to begin supplying
biobased materials to manufacturers of mobile equipment hydraulic
fluids, roof coatings, water tank coatings, diesel fuel additives,
penetrating lubricants, and bedding, bed linens, and towels and to
begin supplying these products made with biobased materials to Federal
agencies and their contractors. In addition, other businesses,
including small businesses, that do not directly contract with
procuring agencies may be affected positively by the increased demand
for these biobased materials and products. However, other businesses
that manufacture and supply only non-qualifying products and do not
offer a biobased alternative product may experience a decrease in
demand for their products. Thus, this rule will likely increase the
demand for biobased products, while decreasing the demand for non-
qualifying products. It is anticipated that this will create a largely
``offsetting'' economic impact.
USDA is unable to determine the number of businesses, including
small businesses, that may be adversely affected by this rule. If a
business currently supplies mobile equipment hydraulic fluids, roof
coatings, water tank coatings, diesel fuel additives, penetrating
lubricants, or bedding, bed linens, and towels to a procuring agency
and those products do not qualify as biobased products, the rule may
reduce that company's ability to compete for future contracts. However,
the rule will not affect existing purchase orders, nor will it preclude
businesses from modifying their product lines to meet new
specifications or solicitation requirements for these products
containing biobased materials. Thus, many businesses, including small
businesses, that market to Federal agencies and their contractors have
the option of modifying their product lines to meet the new biobased
specifications.
2. Summary of Benefits
The designation of these six items provides the benefits outlined
in the objectives of section 9002: To increase domestic demand for many
agricultural commodities that can serve as feedstocks for production of
biobased products; to spur development of the industrial base through
value-added agricultural processing and manufacturing in rural
communities; to enhance the Nation's energy security by substituting
biobased products for products derived from imported oil and natural
gas; and to substitute products with a possibly more benign or
beneficial environmental impact, as compared to the use of fossil
energy-based products. By purchasing these biobased products, procuring
agencies can increase opportunities for all of these benefits. On a
national and regional level, this rule can result in expanding and
strengthening markets for biobased materials used in these six items.
However, because the extent to which procuring agencies will find the
performance and costs of biobased products acceptable is unknown, it is
impossible to quantify the actual economic effect of the rule. USDA,
however, anticipates the annual economic effect of the designation of
these six items to be substantially below the $100 million threshold.
In addition, this rule does not: Create serious inconsistency or
otherwise interfere with an action taken or planned by another agency;
materially alter the budgetary impact of entitlements, grants, user
fees, or loan programs or the rights and obligations of recipients
thereof; or raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
Executive Order 12866.
B. Regulatory Flexibility Act (RFA)
When an agency issues a final rule following a proposed rule, the
Regulatory Flexibility Act (RFA, 5 U.S.C. 601-612) requires the agency
to prepare a final regulatory flexibility analysis. 5 U.S.C. 604.
However, the requirement for a final regulatory flexibility analysis
does not apply if the head of the agency certifies that the rule will
not, if promulgated, have a significant economic impact on a
substantial number of small entities. 5 U.S.C. 605(b).
USDA evaluated the potential impacts of its designation of these
six items to determine whether its actions would have a significant
impact on a substantial number of small entities. Because the Federal
Biobased Products Preferred Procurement Program in section 9002 of
FSRIA applies only to Federal agencies and their contractors, small
governmental (city, county, etc.) agencies are not affected. Thus, this
rule will not have a significant economic impact on small governmental
jurisdictions. USDA anticipates that this program will affect entities,
both large and small, that manufacture or sell biobased products. For
example, the designation of items for preferred procurement will
provide additional opportunities for businesses to manufacture and sell
biobased products to Federal agencies and their contractors. Similar
opportunities will be provided for entities that supply biobased
materials to manufacturers. Conversely, the biobased procurement
program may decrease opportunities for businesses that manufacture or
sell non-biobased products or provide components for the manufacturing
of such products. However, this rule will not affect existing purchase
orders and it will not preclude procuring agencies from continuing to
purchase non-biobased items under certain conditions relating to the
availability, performance, or cost of biobased items. This rule will
also not preclude businesses from modifying their product lines to meet
new specifications or solicitation requirements for these products
containing biobased materials. Thus, the economic impacts of this rule
are not expected to be significant.
The intent of section 9002 is largely to stimulate the production
of new biobased products and to energize emerging markets for those
products. Because the program is still in its infancy, however, it is
unknown how many businesses will ultimately be affected. While USDA has
no data on the number of small businesses that may choose to develop
and market products within the six items designated by this rulemaking,
the number is expected to be small. Because biobased products represent
a small emerging market, only a small percentage of all manufacturers,
large or small, are expected to develop and market biobased products.
Thus,
[[Page 13704]]
the number of small businesses affected by this rulemaking is not
expected to be substantial.
After considering the economic impacts of this rule on small
entities, USDA certifies that this action will not have a significant
economic impact on a substantial number of small entities.
While not a factor relevant to determining whether the rule will
have a significant impact for RFA purposes, USDA has concluded that the
effect of the rule will be to provide positive opportunities to
businesses engaged in the manufacture of these biobased products.
Purchase and use of these biobased products by procuring agencies
increase demand for these products and result in private sector
development of new technologies, creating business and employment
opportunities that enhance local, regional, and national economies.
Technological innovation associated with the use of biobased materials
can translate into economic growth and increased industry
competitiveness worldwide, thereby, creating opportunities for small
entities.
C. Executive Order 12630: Governmental Actions and Interference With
Constitutionally Protected Property Rights
This rule has been reviewed in accordance with Executive Order
12630, Governmental Actions and Interference with Constitutionally
Protected Property Rights, and does not contain policies that would
have implications for these rights.
D. Executive Order 12988: Civil Justice Reform
This rule has been reviewed in accordance with Executive Order
12988, Civil Justice Reform. This rule does not preempt State or local
laws, is not intended to have retroactive effect, and does not involve
administrative appeals.
E. Executive Order 13132: Federalism
This rule does not have sufficient federalism implications to
warrant the preparation of a Federalism Assessment. Provisions of this
rule will not have a substantial direct effect on States or their
political subdivisions or on the distribution of power and
responsibilities among the various government levels.
F. Unfunded Mandates Reform Act of 1995
This rule contains no Federal mandates under the regulatory
provisions of Title II of the Unfunded Mandates Reform Act of 1995
(UMRA), 2 U.S.C. 1531-1538, for State, local, and tribal governments,
or the private sector. Therefore, a statement under section 202 of UMRA
is not required.
G. Executive Order 12372: Intergovernmental Review of Federal Programs
For the reasons set forth in the Final Rule Related Notice for 7
CFR part 3015, subpart V (48 FR 29115, June 24, 1983), this program is
excluded from the scope of the Executive Order 12372, which requires
intergovernmental consultation with State and local officials. This
program does not directly affect State and local governments.
H. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
Today's rule does not significantly or uniquely affect ``one or
more Indian tribes, * * * the relationship between the Federal
Government and Indian tribes, or * * * the distribution of power and
responsibilities between the Federal Government and Indian tribes.''
Thus, no further action is required under Executive Order 13175.
I. Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
3501 through 3520), the information collection under this rule is
currently approved under OMB control number 0503-0011.
J. Government Paperwork Elimination Act Compliance
The Office of Energy Policy and New Uses is committed to compliance
with the Government Paperwork Elimination Act (GPEA) (44 U.S.C. 3504
note), which requires Government agencies in general to provide the
public the option of submitting information or transacting business
electronically to the maximum extent possible. USDA is implementing an
electronic information system for posting information voluntarily
submitted by manufacturers or vendors on the products they intend to
offer for preferred procurement under each designated item. For
information pertinent to GPEA compliance related to this rule, please
contact Marvin Duncan at (202) 401-0461.
List of Subjects in 7 CFR Part 2902
Biobased products, Procurement.
0
For the reasons stated in the preamble, the Department of Agriculture
is amending 7 CFR chapter XXIX as follows:
CHAPTER XXIX--OFFICE OF ENERGY POLICY AND NEW USES, DEPARTMENT OF
AGRICULTURE
PART 2902--GUIDELINES FOR DESIGNATING BIOBASED PRODUCTS FOR FEDERAL
PROCUREMENT
0
1. The authority citation for part 2902 continues to read as follows:
Authority: 7 U.S.C. 8102.
0
2. Add in alphabetical order definitions for ``biodegradability,''
``EPA-designated recovered content product,'' and ``functional unit''
to Sec. 2902.2 to read as follows:
Sec. 2902.2 Definitions.
* * * * *
Biodegradability. A quantitative measure of the extent to which a
material is capable of being decomposed by biological agents,
especially bacteria.
* * * * *
EPA-designated recovered content product. A product, designated
under the Resource Conservation and Recovery Act, that is subject to
Federal procurement as specified in section 6002 of the Solid Waste
Disposal Act (42 U.S.C. 6962), whereby Federal agencies must give
preferred procurement to those products composed of the highest
percentage of recovered materials practicable, subject to availability,
cost, and performance.
* * * * *
Functional unit. A measure of product technical performance that
provides a common reference to which all environmental and economic
impacts of the product are scaled. This reference is necessary to
ensure comparability of performance results across competing products.
Comparability of results is critical when competing product
alternatives are being assessed to ensure that such comparisons are
made on a common basis. For example, the functional unit for competing
interior paint products may be defined as ``protecting one square foot
of interior wall surface for 50 years.''
* * * * *
0
3. Add paragraph (c) to Sec. 2902.8 to read as follows:
Sec. 2902.8 Determining life cycle costs, environmental and health
benefits, and performance.
* * * * *
(c) Biodegradability information. If biodegradability is claimed by
the manufacturer of a qualifying biobased product as a characteristic
of that product, USDA requires that, if requested by procuring
agencies, these claims be verified using the appropriate, product-
specific ASTM biodegradability
[[Page 13705]]
standard(s). Such testing must be conducted by an ASTM/ISO-compliant
laboratory. The procuring official will decide whether biodegradability
data must be brand-name specific in the case of products that are
essentially of the same formulation. ASTM biodegradability standards
include:
(1) D5338 ``Standard Test Method for Determining Aerobic
Biodegradation of Plastic Materials Under Controlled Composting
Conditions'';
(2) D5864 ``Standard Test Method for Determining the Aerobic
Aquatic Biodegradation of Lubricants or Their Components'';
(3) D6006 ``Standard Guide for Assessing Biodegradability of
Hydraulic Fluids'';
(4) D6400 ``Standard Specification for Compostable Plastics'' and
the standards cited therein;
(5) D6139 ``Standard Test Method for Determining the Aerobic
Aquatic Biodegradation of Lubricants or Their Components Using the
Gledhill Shake Flask'';
(6) D6868 ``Standard Specification for Biodegradable Plastics Used
as Coatings on Paper and Other Compostable Substrates''; and
(7) D7081 ``Standard Specification for Non-Floating Biodegradable
Plastics in the Marine Environment.''
* * * * *
0
4. Add Sec. Sec. 2902.10 through 2902.15 to subpart B to read as
follows:
Sec. 2902.10 Mobile equipment hydraulic fluids.
(a) Definition. Hydraulic fluids formulated for general use in non-
stationary equipment, such as tractors, end loaders, or backhoes.
(b) Minimum biobased content. The minimum biobased content is 44
percent and shall be based on the amount of qualifying biobased carbon
in the product as a percent of the weight (mass) of the total organic
carbon in the finished product.
(c) Preference effective date. No later than March 16, 2007,
procuring agencies, in accordance with this part, will give a
procurement preference for qualifying biobased mobile equipment
hydraulic fluids. By that date, Federal agencies that have the
responsibility for drafting or reviewing specifications for items to be
procured shall ensure that the relevant specifications require the use
of biobased mobile equipment hydraulic fluids.
(d) Determining overlap with an EPA-designated recovered content
product. Qualifying biobased products that fall under this item may, in
some cases, overlap with the following EPA-designated recovered content
product: Re-refined Lubricating Oils. USDA is requesting that
manufacturers of these qualifying biobased products provide information
on the USDA Web site of qualifying biobased products about the intended
uses of the product, whether or not the product contains petroleum-
based ingredients, re-refined oil, and/or any other recovered material,
and performance standards against which the product has been tested.
This information will assist Federal agencies in determining whether or
not a qualifying biobased product overlaps with EPA-designated
lubricating oils containing re-refined oil and which product should be
afforded the preference in purchasing.
(e) Exemptions. The following applications are exempt for the
preferred procurement requirement for this item:
(1) Military equipment: Product or system designed or procured for
combat or combat-related missions.
(2) Spacecraft systems and launch support equipment.
Sec. 2902.11 Roof coatings.
(a) Definition. Coatings formulated for use in commercial roof deck
systems to provide a single-coat monolith coating system.
(b) Minimum biobased content. The minimum biobased content is 20
percent and shall be based on the entire product.
(c) Preference effective date. No later than March 16, 2007,
procuring agencies, in accordance with this part, will give a
procurement preference for qualifying biobased roof coatings. By that
date, Federal agencies that have the responsibility for drafting or
reviewing specifications for items to be procured shall ensure that the
relevant specifications require the use of biobased roof coatings.
(d) Determining overlap with an EPA-designated recovered content
product. Qualifying biobased products that fall under this item may, in
some cases, overlap with the following EPA-designated recovered content
product: Roofing Materials. USDA is requesting that manufacturers of
these qualifying biobased products provide information on the USDA Web
site of qualifying biobased products about the intended uses of the
product, whether or not the product contains any type of recovered
material, and performance standards against which the product has been
tested. This information will assist Federal agencies in determining
whether or not a qualifying biobased product overlaps with recovered
content roofing materials and which product should be afforded the
preference in purchasing.
Sec. 2902.12 Water tank coatings.
(a) Definition. Coatings formulated for use in potable water
storage systems.
(b) Minimum biobased content. The minimum biobased content is 59
percent and shall be based on the entire product.
(c) Preference effective date. Determination of the effective date
for this item is deferred until USDA identifies two or more
manufacturers of biobased water tank coatings. At that time, USDA will
publish a document in the Federal Register announcing that Federal
agencies have one year from the date of the publication to give
procurement preference to water tank coatings.
Sec. 2902.13 Diesel fuel additives.
(a) Definition. (1) Any substance, other than one composed solely
of carbon and/or hydrogen, that is intentionally added to diesel fuel
(including any added to a motor vehicle's fuel system) and that is not
intentionally removed prior to sale or use.
(2) Neat biodiesel, also referred to as B100, when used as an
additive. Diesel fuel additive does not mean neat biodiesel when used
as a fuel or blended biodiesel fuel (e.g., B20).
(b) Minimum biobased content. The minimum biobased content is 90
percent and shall be based on the amount of qualifying biobased carbon
in the product as a percent of the weight (mass) of the total organic
carbon in the finished product.
(c) Preference effective date. No later than March 16, 2007,
procuring agencies, in accordance with this part, will give a
procurement preference for qualifying biobased diesel fuel additives.
By that date, Federal agencies that have the responsibility for
drafting or reviewing specifications for items to be procured shall
ensure that the relevant specifications require the use of biobased
diesel fuel additives.
(d) Exemptions. The following applications are exempt for the
preferred procurement requirement for this item:
(1) Military equipment: Product or system designed or procured for
combat or combat-related missions.
(2) Spacecraft systems and launch support equipment.
Sec. 2902.14 Penetrating lubricants.
(a) Definition. Products formulated to provide light lubrication
and corrosion resistance in close tolerant internal and external
applications including frozen
[[Page 13706]]
nuts and bolts, power tools, gears, valves, chains, and cables.
(b) Minimum biobased content. The minimum biobased content is 68
percent and shall be based on the amount of qualifying biobased carbon
in the product as a percent of the weight (mass) of the total organic
carbon in the finished product.
(c) Preference effective date. No later than March 16, 2007,
procuring agencies, in accordance with this part, will give a
procurement preference for qualifying biobased penetrating lubricants.
By that date, Federal agencies that have the responsibility for
drafting or reviewing specifications for items to be procured shall
ensure that the relevant specifications require the use of biobased
penetrating lubricants.
(d) Determining overlap with an EPA-designated recovered content
product. Qualifying biobased products that fall under this item may, in
some cases, overlap with the following EPA-designated recovered content
product: Re-refined Lubricating Oils. USDA is requesting that
manufacturers of these qualifying biobased products provide information
on the USDA Web site of qualifying biobased products about the intended
uses of the product, whether or not the product contains petroleum-
based ingredients, re-refined oil, and/or any other recovered material,
in addition to biobased ingredients, and performance standards against
which the product has been tested. This information will assist Federal
agencies in determining whether or not a qualifying biobased product
overlaps with EPA-designated lubricating oils containing re-refined oil
and which product should be afforded the preference in purchasing.
(e) Exemptions. The following applications are exempt for the
preferred procurement requirement for this item:
(1) Military equipment: Product or system designed or procured for
combat or combat-related missions.
(2) Spacecraft systems and launch support equipment.
Sec. 2902.15 Bedding, bed linens, and towels.
(a) Definition. (1) Bedding is that group of woven cloth products
used as coverings on a bed. Bedding includes products such as blankets,
bedspreads, comforters, and quilts.
(2) Bed linens are woven cloth sheets and pillowcases used in
bedding.
(3) Towels are woven cloth products used primarily for drying and
wiping.
(b) Minimum biobased content. The minimum biobased content is 12
percent and shall be based on the amount of qualifying biobased carbon
in the finished product as a percent of the weight (mass) of the total
organic carbon in the finished product. The 12 percent biobased content
must be of a qualifying biobased feedstock. Cotton, wool, linen, and
silk are not qualifying biobased feedstocks for the purpose of
determining the biobased content of bedding, bed linens, and towels.
(c) Preference effective date. Determination of the effective date
for this item is deferred until USDA identifies two or more
manufacturers of biobased bedding, bed linens, and towels. At that
time, USDA will publish a document in the Federal Register announcing
that Federal agencies have one year from the date of the publication to
give procurement preference to bedding, bed linens, and towels.
Dated: March 7, 2006.
Keith Collins,
Chief Economist, U.S. Department of Agriculture.
[FR Doc. 06-2323 Filed 3-15-06; 8:45 am]
BILLING CODE 3410-GL-P