[Federal Register: April 16, 2009 (Volume 74, Number 72)]
[Rules and Regulations]               
[Page 17591-17593]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr16ap09-2]                         

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 966

[Doc. No. AMS FV-08-0090; FVO9-966-1 FIR]

 
Tomatoes Grown in Florida; Partial Exemption to the Minimum Grade 
Requirements

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Department of Agriculture (USDA) is adopting, as a final 
rule, without change, an interim final rule providing a partial 
exemption to the minimum grade requirements under the marketing order 
for tomatoes grown in Florida (order). The order regulates the handling 
of tomatoes grown in Florida and is administered locally by the Florida 
Tomato Committee (Committee). Absent an exemption, Florida tomatoes 
covered by the order must meet at least a U.S. No. 2 grade before they 
can be shipped and sold outside the regulated area. This rule continues 
in effect the action that exempted Vintage Ripes\TM\ tomatoes (Vintage 
Ripes\TM\) from the shape requirements associated with the U.S. No. 2 
grade. This change increases the volume of Vintage Ripes\TM\ that meets 
the order requirements, and helps increase shipments and availability 
of these tomatoes.

DATES: Effective Date: May 18, 2009.

FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Marketing Specialist, 
or Christian Nissen, Regional Manager, Southeast Marketing Field 
Office, Marketing Order Administration Branch, Fruit and Vegetable 
Programs, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 325-8793, or 
e-mail: Doris.Jamieson@usda.gov or Christian.Nissen@usda.gov.
    Small businesses may request information on complying with this 
regulation by contacting Jay Guerber, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence 
Avenue, SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 
720-2491, Fax: (202) 720-8938, or e-mail: Jay.Guerber@usda.gov.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement No. 125 and Marketing Order No. 966, both as amended (7 CFR 
part 966), regulating the handling of tomatoes grown in certain 
designated counties in Florida, hereinafter referred to as the 
``order.'' The marketing agreement and order are effective under the 
Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-
674), hereinafter referred to as the ``Act.''
    USDA is issuing this rule in conformance with Executive Order 
12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule 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.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA a petition 
stating that the order, any provision of the order, or any obligation 
imposed in connection with the order is not in accordance with law and 
request a modification of the order or to be exempted therefrom. A 
handler is afforded the opportunity for a hearing

[[Page 17592]]

on the petition. After the hearing, USDA would rule on the petition. 
The Act provides that the district court of the United States in any 
district in which the handler is an inhabitant, or has his or her 
principal place of business, has jurisdiction to review USDA's ruling 
on the petition, provided an action is filed not later than 20 days 
after the date of the entry of the ruling.
    This rule continues in effect the action that added a partial 
exemption to the minimum grade requirements prescribed under the order. 
Absent an exemption, Florida tomatoes covered by the order must meet at 
least a U.S. No. 2 grade before they can be shipped and sold outside 
the regulated area. This rule continues to exempt Vintage Ripes\TM\ 
from the shape requirements associated with the U.S. No. 2 grade. This 
change increases the volume of Vintage Ripes\TM\ that meets the order 
requirements, and helps increase shipments and availability of these 
tomatoes.
    Section 966.52 of the order provides the authority for the 
establishment of grade and size requirements for Florida tomatoes. Form 
and shape represent part of the elements of grade. Section 966.323 of 
the order's rules and regulations specifies, in part, the minimum grade 
requirements for Florida tomatoes. The current minimum grade 
requirement for Florida tomatoes is a U.S. No. 2. The specifics of this 
grade requirement are listed under the U.S. Standards for Grades of 
Fresh Tomatoes (7 CFR 51.1855-51.1877).
    The U.S. Standards for Grades of Fresh Tomatoes (Standards) specify 
the criteria tomatoes must meet to grade a U.S. No. 2, including that 
they must be reasonably well formed, and not more than slightly rough. 
These two elements relate specifically to the shape of the tomato. The 
definitions section of the Standards defines reasonably well formed as 
not decidedly kidney shaped, lopsided, elongated, angular, or otherwise 
decidedly deformed. The term slightly rough means that the tomato is 
not decidedly ridged or grooved. This rule amends Sec.  966.323 to 
exempt Vintage Ripes\TM\ from these shape requirements as specified 
under the grade for a U.S. No. 2.
    Vintage RipesTM are a trademarked tomato variety bred to 
look and taste like an heirloom-type tomato. One of the characteristics 
of this variety is its appearance. Vintage RipesTM are often 
shaped differently from other round tomatoes. Depending on the time of 
year and the weather, Vintage RipesTM are concave on the 
stem end with deep, ridged shoulders. They can also be very misshapen, 
appearing kidney shaped or lopsided. Because of this variance in shape 
and appearance, Vintage RipesTM have difficulty meeting the 
shape requirements of the U.S. No. 2 grade.
    In addition, the cost of production and handling for these tomatoes 
tends to be higher when compared to standard commercial varieties. The 
shoulders on Vintage RipesTM are easily damaged, requiring 
additional care during picking and handling. These tomatoes are also 
more susceptible to disease. Consequently, Vintage RipesTM 
require greater care in production to keep injuries and blemishes to a 
minimum. Still, when compared to standard commercial varieties, even 
with taking special precautions, larger quantities of these tomatoes 
are left in the field or need to be eliminated in the packinghouse to 
ensure a quality product. Losses can approach 50 percent or higher for 
Vintage RipesTM. With the higher production costs and the 
reduced packout, these tomatoes tend to sell at a higher price point 
than standard round tomatoes.
    Heirloom-type tomatoes have been gaining favor with consumers. 
Vintage RipesTM were bred specifically to address this 
demand. However, with its difficulty in meeting established shape 
requirements, and its increased cost of production, producing these 
tomatoes for market may not be financially viable without an exemption. 
In order to make more of these specialty tomatoes available for 
consumers, the Committee agreed to exempt Vintage RipesTM 
from the shape requirements of the U.S. No. 2 grade. This exemption is 
the same as previously provided for a similar type tomato (72 FR 1919, 
January 17, 2007).
    This rule only provides Vintage RipesTM with a partial 
exemption from the grade requirements under the order. Consequently, 
Vintage RipesTM are exempt from the shape requirements of 
the grade but are still required to meet all other aspects of the U.S. 
No. 2 grade. Vintage RipesTM also continue to be required to 
meet all other requirements under the order, such as size, pack and 
container, and inspection.
    Prior to the 1998-99 season, the Committee recommended that the 
minimum grade be increased from a U.S. No. 3 to a U.S. No. 2. Committee 
members agree that increasing the grade requirement has been very 
beneficial to the industry and in the marketing of Florida tomatoes. It 
is important to the Committee that these benefits be maintained. There 
was some industry concern that providing a partial exemption for shape 
for an heirloom-type tomato could result in the shipment of U.S. No. 3 
grade tomatoes of standard commercial varieties, contrary to the 
objectives of the exemption and the order.
    To ensure this exemption does not result in the shipment of U.S. 
No. 3 grade tomatoes of other varieties, this exemption only applies to 
Vintage RipesTM covered under the Agricultural Marketing 
Service's Identity Preservation (IP) program. The IP program was 
developed by the Agricultural Marketing Service to assist companies in 
marketing products having unique traits. The program provides 
independent, third-party verification of the segregation of a company's 
unique product at every stage, from seed, production and processing, to 
distribution. This exemption is contingent upon the Vintage 
RipesTM gaining and maintaining positive program status 
under the IP program and continuing to meet program requirements. As 
such, this should help ensure that only Vintage RipesTM are 
shipped under this exemption.
    Therefore, this rule continues in effect the action that exempted 
Vintage RipesTM from the shape requirements associated with 
the U.S. No. 2 grade. This change increases the volume of Vintage 
RipesTM tomatoes that meets order requirements, and helps 
increase shipments and availability of these tomatoes.
    Section 8e of the Act provides that when certain domestically 
produced commodities, including tomatoes, are regulated under a Federal 
marketing order, imports of that commodity must meet the same or 
comparable grade, size, quality, and maturity requirements. Since this 
rule provides a partial exemption from the minimum grade requirements 
under the domestic handling regulations, a corresponding change to the 
import regulations is also needed. A final rule providing a similar 
partial exemption to the minimum grade requirements under the import 
regulations will be issued as a separate action.

Final Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) 
has considered the economic impact of this action on small entities. 
Accordingly, AMS has prepared this final regulatory flexibility 
analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are

[[Page 17593]]

unique in that they are brought about through group action of 
essentially small entities acting on their own behalf.
    There are approximately 100 producers of tomatoes in the production 
area and approximately 70 handlers subject to regulation under the 
marketing order. Small agricultural producers are defined by the Small 
Business Administration (SBA) as those having annual receipts less than 
$750,000, and small agricultural service firms are defined as those 
whose annual receipts are less than $7,000,000 (13 CFR 121.201).
    Based on industry and Committee data, the average annual price for 
fresh Florida tomatoes during the 2007-08 season was approximately 
$13.71 per 25-pound container, and total fresh shipments for the 2007-
08 season were 45,177,457 25-pound cartons of tomatoes. Committee data 
indicates that around 25 percent of the handlers handle 94 percent of 
the total volume shipped outside the regulated area. Based on the 
average price, about 75 percent of handlers could be considered small 
businesses under SBA's definition. In addition, based on production 
data, grower prices as reported by the National Agricultural Statistics 
Service, and the total number of Florida tomato growers, the average 
annual grower revenue is below $750,000. Thus, the majority of handlers 
and producers of Florida tomatoes may be classified as small entities.
    This rule continues in effect the action that provided a partial 
exemption to the minimum grade requirements for tomatoes grown in 
Florida. Absent an exemption, Florida tomatoes covered by the order 
must meet at least a U.S. No. 2 grade before they can be shipped and 
sold outside the regulated area. This rule continues to exempt Vintage 
RipesTM from the shape requirements associated with the U.S. 
No. 2 grade. This change increases the volume of Vintage 
RipesTM that meets the order requirements, and helps 
increase shipments and availability of these tomatoes. This rule amends 
the provisions of Sec.  966.323. Authority for this action is provided 
in Sec.  966.52 of the order.
    This change represents a small increase in costs for producers and 
handlers of Vintage RipesTM, primarily from costs associated 
with developing and maintaining the IP program. However, this rule 
makes additional volumes of Vintage RipesTM available for 
shipment. This should result in increased sales of Vintage 
RipesTM. Consequently, the benefits of this action are 
expected to more than offset the associated costs.
    One alternative to this action that was considered was to not 
provide an exemption from shape requirements for Vintage 
RipesTM. However, providing the exemption increases the 
volume of Vintage RipesTM that meets the order requirements, 
and helps increase shipments and availability of these tomatoes for 
consumers. Further, the same exemption had been provided previously for 
a similar tomato. Therefore, this alternative was rejected.
    AMS is committed to complying with the E-Government Act, to promote 
the use of the Internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.
    This rule will not impose any additional reporting or recordkeeping 
requirements beyond the IP program on either small or large tomato 
handlers. As with all Federal marketing order programs, reports and 
forms are periodically reviewed to reduce information requirements and 
duplication by industry and public sector agencies. In addition, as 
noted in the initial regulatory flexibility analysis, USDA has not 
identified any relevant Federal rules that duplicate, overlap or 
conflict with this rule.
    Further, the Committee's meeting was widely publicized throughout 
the Florida tomato industry and all interested persons were invited to 
attend the meeting and participate in Committee deliberations. Like all 
Committee meetings, the September 4, 2008, meeting was a public meeting 
and all entities, both large and small, were able to express their 
views on this issue.
    An interim final rule concerning this action was published in the 
Federal Register on December 16, 2008 (73 FR 75537). Copies of the rule 
were mailed by the Committee's staff to all Committee members and 
Florida tomato handlers. In addition, the rule was made available 
through the Internet by USDA and the Office of the Federal Register. 
That rule provided for a 60-day comment period which ended February 17, 
2009. No comments were received.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http:/
/www.ams.usda.gov/AMSv1.0/
ams.fetchTemplateData.do?template=TemplateN&page=MarketingOrdersSmallBus
inessGuide. Any questions about the compliance guide should be sent to 
Jay Guerber at the previously mentioned address in the FOR FURTHER 
INFORMATION CONTACT section.
    After consideration of all relevant material presented, including 
the Committee's recommendation, and other information, it is found that 
finalizing the interim final rule, without change, as published in the 
Federal Register (73 FR 76191, December 16, 2008) will tend to 
effectuate the declared policy of the Act.

List of Subjects in 7 CFR Part 966

    Marketing agreements, Reporting and recordkeeping requirements, 
Tomatoes.

PART 966--TOMATOES GROWN IN FLORIDA

0
Accordingly, the interim final rule amending 7 CFR part 966 which was 
published at 73 FR 76191 on December 16, 2008, is adopted as a final 
rule without change.

    Dated: April 9, 2009.
Robert C. Keeney,
Acting Associate Administrator, Agricultural Marketing Service.
[FR Doc. E9-8684 Filed 4-15-09; 8:45 am]

BILLING CODE 3410-02-P