[Federal Register Volume 76, Number 56 (Wednesday, March 23, 2011)]
[Proposed Rules]
[Pages 16321-16322]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-6835]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 76, No. 56 / Wednesday, March 23, 2011 /
Proposed Rules
[[Page 16321]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 28
[AMS-CN-10-0111; CN-11-001]
RIN 0581-AD11
User Fees for 2011 Crop Cotton Classification Services to Growers
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: The Agricultural Marketing Service (AMS) is proposing to
maintain user fees for cotton producers for 2011 crop cotton
classification services under the Cotton Statistics and Estimates Act
at the same level as in 2010. These fees are also authorized under the
Cotton Standards Act of 1923. The 2010 crop user fee was $2.20 per
bale, and AMS proposes to continue the fee for the 2011 cotton crop at
that same level. This proposed fee and the existing reserve are
sufficient to cover the costs of providing classification services for
the 2011 crop, including costs for administration and supervision.
DATES: Comments must be received on or before April 7, 2011.
ADDRESSES: Interested persons may comment on the proposed rule using
the following procedures:
Internet: http://www.regulations.gov.
Mail: Comments may be submitted by mail to: Darryl
Earnest, Deputy Administrator, Cotton and Tobacco Programs, AMS, USDA,
Rm. 2635-S, STOP 0224, 1400 Independence Avenue, SW., Washington, DC
20250-0224. Comments should be submitted in triplicate. All comments
should reference the docket number and the date and the page of this
issue of the Federal Register. All comments received will be available
for public inspection during regular business hours at the above office
in Room 2635, South Building, 1400 Independence Avenue, SW.,
Washington, DC. Comments can also be reviewed on: regulations.gov. A
copy of this notice may be found at: http://www.ams.usda.gov/cotton/rulemaking.htm.
FOR FURTHER INFORMATION CONTACT: Darryl Earnest, Deputy Administrator,
Cotton and Tobacco Programs, AMS, USDA, Room 2635-S, STOP 0224, 1400
Independence Avenue, SW., Washington, DC 20250-0224. Telephone (202)
720-3193, facsimile (202) 690-1718, or e-mail
[email protected].
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This proposed 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 proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. It is not intended to have retroactive effect.
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). Continuing the user fee at the 2010
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 2010
user fee for classification services was $2.20 per bale; the fee for
the 2011 crop would be maintained at $2.20 per bale; the 2011 crop is
estimated at 16,500,000 bales);
(2) The fee for services will not affect competition in the
marketplace;
(3) The use of classification services is voluntary. For the 2010
crop, 18,150,000 bales were produced; and, almost all of these bales
were voluntarily submitted by growers for the classification service;
and
(4) Based on the average price paid to growers for cotton from the
2009 crop of 0.6210 cents per pound, 500 pound bales of cotton are
worth an average of $311 each. The proposed user fee for classification
services, $2.20 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), 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 proposed rule would maintain the 2010 user fee of $2.20 per
bale charged to producers for cotton classification for the 2011 cotton
crop. The 2010 user fee was set in accordance to section 14201 of the
Food, Conservation, and Energy Act of 2008 (Pub. L. 110-234) (2008 Farm
Bill). Prior to the change in the 2008 Farm Bill, the fee was
determined using a user-fee formula mandated in the Uniform Cotton
Classing Fees Act of 1987, as amended (Pub. L. 100-108, 728) (1987
Act). 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.
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
[[Page 16322]]
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,
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 amount
per bale classed) is proposed for the 2011 cotton crop 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 of at least four
months of projected operating costs.
The user fee proposed to be charged cotton producers for cotton
classification in 2011 is $2.20 per bale which is the same fee charged
for the 2010 crop. This fee is based on the pre-season projection that
16,500,000 bales will be classed by the United States Department of
Agriculture during the 2011 crop year.
Accordingly, Sec. 28.909, paragraph (b) would reflect the
continuation of the cotton classification fee at $2.20 per bale.
As provided for in the 1987 Act, a 5 cent per bale discount would
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
would 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 would remain at 5 cents per bale.
The fee in Sec. 28.910(b) for an owner receiving classification data
from the National database would remain at 5 cents per bale, and the
minimum charge of $5.00 for services provided per monthly billing
period would 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 would be
maintained at $2.20 per bale.
The fee for returning samples after classification in Sec. 28.911
would remain at 50 cents per sample.
A 15-day comment period is provided for public comments. This
period is appropriate because it is anticipated that the proposed fees,
if adopted, would be made effective for the 2011 cotton crop on July 1,
2011.
List of Subjects in 7 CFR Part 28
Administrative practice and procedure, Cotton, Cotton samples,
Grades, Market news, Reporting and record keeping requirements,
Standards, Staples, Testing, Warehouses.
For the reasons set forth in the preamble, 7 CFR part 28 is
proposed to be amended to read as follows:
PART 28--[AMENDED]
1. The authority citation for 7 CFR part 28, subpart D, continues
to read as follows:
Authority: 7 U.S.C. 471-476.
2. In Sec. 28.909, paragraph (b) is revised to read as follows:
Sec. 28.909 Costs.
* * * * *
(b) The cost of High Volume Instrument (HVI) cotton classification
service to producers is $2.20 per bale.
* * * * *
3. In Sec. 28.911, the last sentence of paragraph (a) is revised
to read as follows:
Sec. 28.911 Review classification.
(a) * * * The fee for review classification is $2.20 per bale.
* * * * *
Dated: March 16, 2011.
David R. Shipman,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2011-6835 Filed 3-22-11; 8:45 am]
BILLING CODE 3410-02-P