[Federal Register: June 4, 2009 (Volume 74, Number 106)]
[Rules and Regulations]
[Page 26771-26774]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr04jn09-1]
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Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
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[[Page 26771]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 28
[Doc. AMS-CN-09-0011; CN-09-001]
User Fees for 2009 Crop Cotton Classification Services to Growers
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: The Agricultural Marketing Service (AMS) will raise user fees
for cotton producers for 2009 crop cotton classification services under
the Cotton Statistics and Estimates Act. These user fees also are
authorized under the Cotton Standards Act of 1923. The 2008 user fee
for this classification service was $2.00 per bale. This rule will
raise the fee for the 2009 crop to $2.20 per bale. The proposed fee and
the existing reserve are sufficient to cover the costs of providing
classification services, including costs for administration and
supervision.
DATES: Effective Date: Effective July 1, 2009.
FOR FURTHER INFORMATION CONTACT: Darryl Earnest, Deputy Administrator,
Cotton and Tobacco Program, AMS, USDA, Room 2639-S, STOP 0224, 1400
Independence Avenue, SW., Washington, DC 20250-0224. Telephone (202)
720-2145, facsimile (202) 690-1718, or e-mail darryl.earnest@usda.gov.
SUPPLEMENTARY INFORMATION: A proposed rule detailing the revisions was
published in the Federal Register on March 26, 2009 (74 FR 13128). A
15-day comment period was provided for interested persons to respond to
the proposed rule. Two comments were received from national cotton
industry organizations in support of the service and the need for the
fee increase.
Executive Order 12866
This rule has been determined to be not significant for purposes of
Executive Order 12866; and, therefore has not been reviewed by the
Office of Management and Budget (OMB).
Executive Order 12988
This final rule has been reviewed under Executive Order 12988,
Civil Justice Reform. It is not intended to have retroactive effect.
This rule will not preempt any State or local laws, regulations, or
policies unless they present an irreconcilable conflict with this rule.
There are no administrative procedures that must be exhausted prior to
any judicial challenge to the provisions of this rule.
Regulatory Flexibility Act
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612) AMS has considered the economic impact of
this action on small entities and has determined that its
implementation will not have a significant economic impact on a
substantial number of small businesses.
The purpose of the RFA is to fit regulatory actions to the scale of
businesses subject to such actions so that small businesses will not be
disproportionately burdened. There are an estimated 25,000 cotton
growers in the U.S. who voluntarily use the AMS cotton classing
services annually, and the majority of these cotton growers are small
businesses under the criteria established by the Small Business
Administration (13 CFR 121.201). The increase above the 2008 crop level
as stated will not significantly affect small businesses as defined in
the RFA because:
(1) The fee represents a very small portion of the cost-per-unit
currently borne by those entities utilizing the services. (The 2008
user fee for classification services was $2.00 per bale; the fee for
the 2009 crop would be increased to $2.20 per bale; the 2009 crop is
estimated at 14,500,000 bales).
(2) The fee for services will not affect competition in the
marketplace; and
(3) The use of classification services is voluntary. For the 2008
crop, 12,740,000 bales were produced; and, almost all of these bales
were voluntarily submitted by growers for the classification service.
(4) Based on the average price paid to growers for cotton from the
2007 crop of 53.50 cents per pound, 500 pound bales of cotton are worth
an average of $267.50 each. The proposed user fee increase for
classification services, $.20 per bale, is less than one percent of the
value of an average bale of cotton.
Paperwork Reduction Act
In compliance with OMB regulations (5 CFR part 1320), which
implement the Paperwork Reduction Act (PRA) (44 U.S.C. 3501-3520), the
information collection requirements contained in the provisions to be
amended by this proposed rule have been previously approved by OMB and
were assigned OMB control number 0581-AC43.
Fees for Classification Under the Cotton Statistics and Estimates Act
of 1927
This final rule will establish the user fee charged to producers
for High Volume Instrument (HVI) classification at $2.20 per bale for
the 2009 cotton crop. The 2009 user fee charged to cotton producers for
HVI classification was calculated using new methodology, as was
authorized by section 14201 of the Food, Conservation, and Energy Act
of 2008 (Pub. L. 110-234) (2008 Farm Bill). In previous years, the fee
was determined using a user-fee formula mandated in the Uniform Cotton
Classing Fees Act of 1987 (Pub. L. 100-108, 101 Stat. 728) (1987 Act),
as amended. This formula used the previous year's base fee that was
adjusted for inflation and economies of size (1 percent decrease/
increase for every 100,000 bales above/below 12.5 million bales with
maximum adjustment being 15 percent). The user fee was then
further adjusted to comply with operating reserve constraints (between
10 and 25 percent of projected operating costs) specified by the 1987
Act.
The 2008 user fee charged to cotton producers for High Volume
Instrument (HVI) classification services under the Cotton Statistics
and Estimates Act of 1927 (7 U.S.C. 471-476) was $2.00 per bale during
the 2008 harvest season as determined by using the formula provided in
the 1987 Act. The fee covered salaries, costs of equipment and
supplies, and other overhead costs, including costs for administration
and supervision. Also, the fee structure for the 2007 crop year was
incorporated under the authority of the Cotton Standards Act of 1923 (7
U.S.C. 51-65),
[[Page 26772]]
by an interim final rule effective October 1, 2007 (72 FR 56242).
Section 14201 of the 2008 Farm Bill provides that: (1) The
Secretary shall make available cotton classification services to
producers of cotton, and provide for the collection of classification
fees from participating producers or agents that voluntarily agree to
collect and remit the fees on behalf of the producers; (2)
classification fees collected and the proceeds from the sales of
samples submitted for classification shall, to the extent practicable,
be used to pay the cost of the services provided, including
administrative and supervisory costs; (3) the Secretary shall announce
a uniform classification fee and any applicable surcharge for
classification services not later than June 1 of the year in which the
fee applies; and (4) in establishing the amount of fees under this
section, the Secretary shall consult with representatives of the United
States cotton industry. At pages 313-314, the Joint Explanatory
Statement of the committee of conference for section 14201 stated the
expectation that the cotton classification fee would be established in
the same manner as was applied during the 1992 through 2007 fiscal
years. The classification fee should continue to be a basic, uniform
fee per bale fee as determined necessary to maintain cost-effective
cotton classification service. Further, in consulting with the cotton
industry, the Secretary should demonstrate the level of fees necessary
to maintain effective cotton classification services and provide the
Department of Agriculture with an adequate operating reserve, while
also working to limit adjustments in the year-to-year fee.
Under the provisions of section 14201, a user fee (dollar per bale
classed) is established that, when combined with other sources of
revenue, will result in projected revenues sufficient to reasonably
cover budgeted costs--adjusted for inflation--and allow for adequate
operating reserves to be maintained. Costs considered in this method
include salaries, costs of equipment and supplies, and other overhead
costs, such as facility costs and costs for administration and
supervision. In addition to covering expected costs, the user fee is
set such that projected revenues will generate an operating reserve
adequate to effectively manage uncertainties related to crop size and
cash-flow timing while meeting minimum reserve requirements set by the
Agricultural Marketing Service, which require maintenance of a reserve
fund amount equal to four months of projected operating costs.
Extensive consultations regarding the establishment of the
classification fee with U.S. cotton industry representatives were held
during the period from September 2008 through January 2009 during
numerous publicly held meetings. Representatives of all segments of the
cotton industry, including producers, ginners, bale storage facility
operators, merchants, cooperatives, and textile manufacturers were
addressed in various industry-sponsored forums.
The user fee established to be charged cotton producers for High
Volume Instrument (HVI) classification in 2009 is $2.20 per bale. This
fee is based on the pre-season projection that 14.5 million bales will
be classed by the United States Department of Agriculture during the
2009 crop year.
Accordingly Sec. 28.909, paragraph (b) will reflect the increase
of the HVI classification fee to $2.20 per bale.
A 5 cent per bale discount will continue to be applied to voluntary
centralized billing and collecting agents as specified in Sec.
28.909(c).
Growers or their designated agents receiving classification data
will continue to incur no additional fees if classification data is
requested only once. The fee for each additional retrieval of
classification data in Sec. 28.910 will remain at 5 cents per bale.
The fee in Sec. 28.910 (b) for an owner receiving classification data
from the National database will remain at 5 cents per bale, and the
minimum charge of $5.00 for services provided per monthly billing
period will remain the same. The provisions of Sec. 28.910 (c)
concerning the fee for new classification memoranda issued from the
National database for the business convenience of an owner without
reclassification of the cotton will remain the same at 15 cents per
bale or a minimum of $5.00 per sheet.
The fee for review classification in Sec. 28.911 will increase to
$2.20 per bale.
The fee for returning samples after classification in Sec. 28.911
will remain at 50 cents per sample.
In addition to raising user fees for the 2009 crop cotton
classification services to $2.20 per bale, this rule finalizes the
provisions of the interim final rule published in the Federal Register
at 72FR56242 on October 3, 2007.
Pursuant to 5 U.S.C. 553, good cause exists for not postponing the
effective date of this rule until 30 days after publication in the
Federal Register because this rule maintains uniform user fees for 2009
crop cotton classification services as mandated by the Cotton
Statistics and Estimates Act. The earliest harvest and classification
of 2009 cotton will occur during July, and the law mandates that the
user fee be established sufficiently early so that a uniform fee is
charged for the classification of the entire 2009 cotton crop, which
will extend from July 2009 to May 2010. Only two comments were received
during the public comment period provided in the proposal, and both
were supportive of the need for the user fee increase.
List of Subjects in 7 CFR Part 28
Administrative practice and procedure, Cotton, Cotton samples,
Grades, Market news, Reporting and recordkeeping requirements,
Standards, Staples, Testing, Warehouses.
PART 28--[AMENDED]
0
For the reasons set forth in the preamble, 7 CFR part 28 is amended by
revising subpart D to read as follows:
Subpart D--Cotton Classification and Market News Service for Producers
Sec.
Definitions
Administration
28.902 Director.
Classification and Market News Services
28.903 Classification of samples.
28.904 Market news.
Sampling
28.906 Sampling arrangements.
28.907 Responsibilities of licensed gins or warehouses.
28.908 Samples.
28.909 Costs.
Classification
28.910 Classification of samples and issuance of classification
data.
28.911 Review classification.
Limitations of Services
28.917 Limitations of Services.
Subpart D--Cotton Classification and Market News Service for
Producers
Authority: 7 U.S.C. 51-65; 7 U.S.C. 471-476.
Definitions
Sec. 28.901 Definitions.
When used in the regulations in this subpart:
(a) Act means the United States Cotton Standards Act of 1923, as
amended (7 U.S.C. 51-65) and the Cotton Statistics and Estimates Act of
1927 (7 U.S.C. 471-476), unless otherwise noted.
[[Page 26773]]
(b) Service means the Agricultural Marketing Service of the United
States Department of Agriculture.
(c) Administrator means the Administrator of the Agricultural
Marketing Service, or any officer or employee of the Service to whom
authority has heretofore been delegated, or to whom authority may
hereafter be delegated to act for the Administrator.
(d) Division means the Cotton Division of the Agricultural
Marketing Service.
(e) Director means the Director of the Cotton Division, or any
officer or employee of the Division to whom authority has heretofore
been delegated or to whom authority may hereafter be delegated, to act
for the Director.
(f) Producer means any individual, partnership, corporation,
association, trust, estate, or other legal entity, a State or political
subdivision thereof, or any agency of such State or political
subdivision producing American Upland or American Pima cotton in the
capacity of landowner, landlord, tenant, or sharecropper.
Administration
Sec. 28.902 Director.
The Director shall perform for and under the supervision of the
Administrator, such duties as the Administrator may require in
enforcing the regulations in this subpart.
Classification and Market News Services
Sec. 28.903 Classification of samples.
The Director, or an authorized representative, upon the receipt of
a producer's cotton sample which complies with the regulations in this
subpart shall, as hereinafter provided, furnish to such producer or to
an agent designated by the producer the classification in accordance
with the official cotton standards of the United States.
Sec. 28.904 Market news.
The Director shall cause to be distributed to producers of cotton
and to others on request, timely information on prices for various
qualities of cotton.
Sampling
Sec. 28.906 Sampling arrangements.
(a) Cotton must be sampled by a gin or warehouse that holds a valid
license to sample cotton issued pursuant to Sec. Sec. 28.20 through
28.22.
(b) The Director, or an authorized representative may direct that
sampling be performed by employees of the Department of Agriculture for
the purpose of appraising the sampling procedures at cotton gins or
warehouses, or for the purpose of providing service to producers in
special cases where a licensed gin or warehouse is not available.
Sec. 28.907 Responsibilities of licensed gins or warehouses.
Each licensee shall be primarily responsible for drawing,
identifying, handling, and shipping samples of cotton in accordance
with this subpart and with instructions furnished by the Director or an
authorized representative from time to time.
Sec. 28.908 Samples.
(a) Only one sample to be submitted. Only one sample from each bale
of eligible cotton shall be submitted for classification under this
subpart. This does not prohibit the submission of an additional sample
from a bale for review classification if the producer so desires.
(b) Drawing of samples manual. (1) Each cut sample shall be drawn
from the bale after it is tied out following the ginning process, and
shall be approximately 6 ounces in weight, not less than 3 ounces of
which are to be drawn from each side of the bale: Provided, That each
sample from a bale of American Pima cotton shall be approximately 10
ounces in weight, not less than 5 ounces of which are to be drawn from
each side of the bale.
(2) Where it is necessary to draw two sets of samples, a single cut
should be made in each side of the bale, and the portion of cotton
removed from each cut should be broken in half across the layers to
provide two complete samples. In those cases where this method would
result in samples of insufficient length, it will be acceptable to
split the sample lengthwise along the layers, provided the outside
portion from each side is submitted for the official classification.
(c) Mechanical sampling. Samples may be drawn in gins equipped with
mechanical samplers approved by the Division and operated according to
sampling instructions furnished by the Director or an authorized
representative. Such samples shall not be less than 6 ounces in weight.
(d) Samples must be representative. Each sample must be
representative of the bale from which drawn.
(e) Handling samples. Samples shall not be dressed or trimmed and
shall be carefully handled in such manner as not to cause loss of leaf,
sand, or other material, or otherwise change their representative
character. Samples shall be handled only by employees of the licensee
prior to shipment or delivery to the cotton classing office of the
Division.
(f) Identifying and shipping samples. Each sample shall be
identified with a tag, supplied or approved by the Division, bearing
the gin or warehouse number of the bale from which the sample was drawn
and the name and address of the producer of the bale. The tag shall be
placed between the two halves of the sample, the sample tightly rolled
and enclosed in a package or bag for shipment. Each package or bag
shall be labeled or marked with the name and address of the licensed
gin or warehouse. The packages shall be shipped or delivered direct to
the cotton classing office serving the territory in which the cotton is
ginned. Samples that were drawn by a mechanical sampler at the gin may
be transported with the bales to the warehouse and then shipped or
delivered direct to the classing office by the warehouse.
(g) Request for classification. Samples received from a licensed
gin or warehouse with the identification tag required in Sec.
28.908(f) shall constitute a request for classification service by the
producer.
Sec. 28.909 Costs.
(a) Costs incident to sampling, tagging, and identification of
samples and transporting samples to points of shipment shall be assumed
by the producer, but tags and containers for the shipment of samples
and shipping charges via U.S. Postal Service or duly authorized common
carrier will be furnished by the service. After classification the
samples shall become the property of the Government. The proceeds of
the sale of cotton samples shall be used to defray the costs of
providing the services under this subpart.
(b) The cost of High Volume Instrument (HVI) cotton classification
service to producers is $2.20 per bale.
(c) The Division will periodically bill producers or the voluntary
agents designated by producers for the cost of classification. A
discount of 5 cents per sample will be granted for services provide
under this section when billing is made to voluntary agents.
Classification
Sec. 28.910 Classification of samples and issuance of classification
data.
(a)(1) The samples submitted as provided in the subpart shall be
classified by employees of the Division and classification memoranda
showing the official quality determination of each sample according to
the official cotton standards of the United States shall be issued by
any one of the following methods at no additional charge:
[[Page 26774]]
(i) Computer diskettes,
(ii) Computer tapes, or
(iii) Telecommunications, with all long distance telephone line
charges paid by the receiver of data.
(2) When an additional copy of the classification memorandum is
issued by any method listed in paragraph (a)(1) of this section, there
will be a charge of five cents per bale. If provided as an additional
method of data transfer, the minimum fee for each tape or diskette
issued shall be $10.00.
(b) Owners of cotton, other than producers, may receive
classification data showing the official quality determination of each
sample by means of telecommunications from a central database to be
maintained by the Division. The fee for this service shall be five
cents per bale, with all long distance telephone line charges paid by
the receiver of data. The minimum charge assessed for services obtained
from the central database be $5.00 per monthly billing period.
(c) Upon request of an owner of cotton for which classification
memoranda have been issued under the subpart, a new memorandum shall be
issued for the business convenience of such owner without the
reclassification of the cotton. Such rewritten memorandum shall bear
the date of its issuance and the date or inclusive dates of the
original classification. The fee for a new memorandum shall be 15 cents
per bale or a minimum of $5.00 per sheet.
Sec. 28.911 Review classification.
(a) A producer may request one review classification for each bale
of eligible cotton. The fee for review classification is $2.20 per
bale.
(b) Samples for review classification must be drawn by gins or
warehouses licensed pursuant to Sec. Sec. 28.20 through 28.22, or by
employees of the United States Department of Agriculture. Each sample
for review classification shall be taken, handled, and submitted
according to Sec. 28.908 and to supplemental instructions issued by
the Director or an authorized representative of the Director. Costs
incident to sampling, tagging, identification, containers, and shipment
for samples for review classification shall be assumed by the producer.
After classification, the samples shall become the property of the
Government unless the producer requests the return of the samples. The
proceeds from the sale of samples that become Government property shall
be used to defray the costs of providing the services under this
subpart. Producers who request return of their samples after classing
will pay a fee of 50 cents per sample in addition to the fee
established above in this section.
Limitations of Services
Sec. 28.917 Limitations of Services.
The Director, or an authorized representative, may suspend,
terminate, or withhold cotton classing and market news services to any
producer upon any failure of the producer to comply with the act or
these regulations. Failure to remit fees for classification services
shall result in loss of service.
Dated: June 2, 2009.
David R. Shipman,
Acting Administrator.
[FR Doc. E9-13148 Filed 6-2-09; 4:15 pm]