[Federal Register Volume 61, Number 17 (Thursday, January 25, 1996)]
[Notices]
[Pages 2386-2389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-1213]
[[Page 2386]]
ENVIRONMENTAL PROTECTION AGENCY
[OPP-300407; FRL-4992-4]
RIN 2070-AC54
Pesticides; Status of Dried Commodities as Raw Agricultural
Commodities
AGENCY: Environmental Protection Agency (EPA).
ACTION: Notice; Interpretive ruling.
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SUMMARY: This notice describes EPA's interpretation of the term ``raw
agricultural commodity'' as applied to dried commodities under the
Federal Food, Drug and Cosmetic Act (21 U.S.C. 301 et seq.). The
statutory definition is not clear, and EPA's current regulatory
definition does not augment or improve the statutory language. EPA's
interpretation turns on the purpose of the drying rather than the means
or degree of the drying. EPA's interpretation is consistent with EPA's
current practice and therefore will not require that any dried
commodity be reclassified from its designation as a processed food to a
raw agricultural commodity or vice versa.
FOR FURTHER INFORMATION CONTACT: By mail: Jean Frane, Policy and
Special Projects Staff (7501C), Environmental Protection Agency, 401 M
St. SW., Washington, DC 20460. Telephone number: 703-305-5944; e-mail:
frane.jean@epamail.epa.gov.
SUPPLEMENTARY INFORMATION:
I. Introduction
In Les v. Reilly, 968 F.2d 985 (9th Cir. 1992), cert. denied, 113
S.Ct. 1361 (1993), the Ninth Circuit U.S. Court of Appeals held that
the Delaney anti-cancer clause in the food additives provision of the
Federal Food, Drug, and Cosmetic Act (FFDCA) was not subject to an
exception for pesticide uses which pose a de minimis cancer risk.
Because the food additives provision applies to pesticides in processed
food but not to pesticides in raw agricultural commodities, in the wake
of the Les decision, a number of people have requested that EPA
reclassify certain foods now treated as processed as raw agricultural
commodities. This notice explains EPA's interpretation of the term
``raw agricultural commodity'' (RAC) as it pertains to dried
agricultural commodities.
II. Background
A. Statutory Background
The FFDCA, 21 U.S.C. 301 et seq., authorizes the establishment by
regulation of maximum permissible levels of pesticides in foods. Such
regulations are commonly referred to as ``tolerances.'' Without such a
tolerance or an exemption from the requirement of a tolerance, a food
containing a pesticide residue is ``adulterated'' under section 402 of
the FFDCA and may not be legally moved in interstate commerce. 21
U.S.C. 331, 342. EPA was authorized to establish pesticide tolerances
under Reorganization Plan No. 3 of 1970. 5 U.S.C. App. at 1343 (1988).
Monitoring and enforcement of pesticide tolerances are carried out by
the U.S. Food and Drug Administration (FDA) and the U.S. Department of
Agriculture.
The FFDCA has separate provisions for tolerances for pesticide
residues on raw agricultural commodities (RACs) and for residues on
processed food. For pesticide residues in or on RACs, EPA establishes
tolerances, or exemptions from tolerances when appropriate, under
section 408 of the act. 21 U.S.C. 346a. EPA regulates pesticide
residues in processed foods under section 409 of the act, which
pertains to ``food additives.'' 21 U.S.C. 348. Maximum residue
regulations established under section 409 are commonly referred to as
food additive tolerances or food additive regulations (FARs). Section
409 FARs are needed, however, only for certain pesticide residues in
processed food. Under section 402(a)(2) of the FFDCA, a pesticide
residue in processed food generally will not render the food
adulterated if the residue results from application of the pesticide to
a RAC and the residue in the processed food when ``ready to eat'' is
below the RAC tolerance set under section 408. This exemption in
section 402(a)(2) is commonly referred to as the ``flow-through''
provision because it allows the section 408 raw food tolerance to flow
through to the processed food form. Thus, a section 409 FAR is only
necessary to prevent foods from being deemed adulterated when the
concentration of the pesticide residue in a processed food when ready
to eat is greater than the tolerance prescribed for the RAC, or if the
processed food itself is treated or comes in contact with a pesticide.
To establish a tolerance regulation under section 408, EPA must
find that the regulation would ``protect the public health.'' 21 U.S.C.
346a(b). In reaching this determination, EPA is directed to consider,
among other things, the ``necessity for the production of an adequate,
wholesome, and economical food supply.'' Id. Prior to establishing a
food additive tolerance under section 409, EPA must determine that the
``proposed use of the food additive [pesticide], under the conditions
of use to be specified in the regulation, will be safe.'' 21 U.S.C.
348(c)(3). Section 409 specifically addresses the safety of
carcinogenic substances in the so-called Delaney clause, which provides
that ``no additive shall be deemed safe if it has been found to induce
cancer when ingested by man or animal or if it is found, after tests
which are appropriate for the evaluation of the safety of food
additives, to induce cancer in man or animal * * * .'' Id. Although EPA
has interpreted the general standard under section 408 to require a
balancing of risks and benefits, where a pesticide which is an animal
or human cancinogen is involved, the section 409 Delaney clause, in
contrast to section 408 and FIFRA, explicitly bars such balancing no
matter how infintesimal the potential human cancer risk. Les v. Reilly,
968 F.2d at 989.
B. Regulatory Background
The consequences of the RAC/processed food determination can be
significant. Pesticide residues in RACs do not require section 409 FARs
and thus only pesticide residues in processed food face the possibility
that they will be evaluated against the Delaney clause. Moreover, it
has been EPA's traditional policy to deny a section 408 tolerance for
residues of a pesticide in a particular RAC if a section 409 FAR is
needed for residues of that pesticide in the processed form of the RAC
but such FAR is barred by the Delaney clause. Elsewhere in this issue
of the Federal Register, EPA reiterates that policy in a response to a
petition filed by the National Food Processors' Association.
Hops growers pressed EPA for several years to reclassify dried hops
from a processed food to a RAC. In 1993, EPA granted the hops growers'
request (refer to Unit III below in this document). In the wake of the
Les v. Reilly decision, reclassification requests have increased
dramatically. Some of these requests have come in the form of
petitions; others have been in comments responding to a petition filed
by the National Food Processors Association (58 FR 7470, Feb. 5, 1993),
or specific EPA tolerance actions. All of these requests have concerned
dried commodities, such as dried fruits.
III. Proper Classification of Dried Commodities
The dried hops situation as well as the many requests EPA has
received for reclassification of other dried commodities as RACs
persuaded EPA that the classification of dried
[[Page 2387]]
commodities generally needed to be evaluated and the regulated
community and public apprised of EPA's approach to this issue.
Accordingly, in this document, EPA is setting forth its interpretation
of how the statutory term ``raw agricultural commodity'' applies to
dried commodities.
A. The Statute and Legislative History
A RAC is defined in FFDCA section 201(r) as ``any food in its raw
or natural state, including all fruits that are washed, colored, or
otherwise treated in their unpeeled natural form prior to marketing.''
21 U.S.C. 321(r). This definition is further amplified by the statute,
EPA's regulations, and the legislative history of section 408 through
language which specifies steps which remove a food from its raw or
natural state, namely, ``canning, cooking, freezing, dehydrating, or
milling.'' Section 402(a)(2), 21 U.S.C. 342(a)(2); 40 CFR 180.1(e); H.
Rep. No. 1385, 83d Cong., 2d Sess. 7 (1954) reprinted in XII A
Legislative History of the Federal Food, Drug, and Cosmetic Act 839
(hereinafter cited as ``Leg. Hist.'').
The legislative history of section 408 explains that the term RAC
is intended to apply to ``food in its raw or natural state as usually
purchased by the consumer or food processor.'' H. Rep. No. 1385, 83d
Cong., 2d Sess. 6 (1954), XII Leg. Hist. 838. Both House and Senate
committee reports list the following examples of foods Congress
considered to be RACs: ``fresh fruits and vegetables, grains, nuts,
eggs, and milk and similar agricultural produce grown or produced at
the farm level.'' Id.; S. Rep. 1635, 83d Cong., 2d Sess. 6, XII Leg.
Hist. at 1014. On the other hand, both reports mention apple juice and
applesauce as examples of processed foods not considered to be RACs.
Id. The Senate report alone also notes that ``sun-dried or artificially
dehydrated fruits'' should not be considered RACs. S. Rep. 1635, 83d
Cong., 2d Sess. 6, XII Leg. Hist. at 1014.
The Senate report reference to dried fruits was added in reaction
to the confusion of the dried fruit industry concerning the coverage of
the term RAC. At the conclusion of the Senate hearing on the pesticides
bill, the following colloquy occurred between committee staff and the
Commissioner of the FDA:
MR. SNEED. Dr. Crawford, it has come to the attention of the
committee that the dried fruit industry is uncertain as to whether
that industry is intended to be included under the provisions in
this bill. What is your interpretation of the intent of the bill in
that regard?
DR. CRAWFORD. We had regarded the term ``raw agricultural
commodities'' as used in this bill and as interpreted when used in
other statutes that have been on the books for some time as
excluding processed foods, and dry [sic] fruits are processed foods.
MR. SNEED. Do you think it is necessary to amend the bill to
clarify that matter?
DR. CRAWFORD. I doubt if it is necessary, particularly if the
committee report makes that clear.
Residues of Pesticide Chemicals: Hearing Before the Subcomm. on Health
of the Senate Comm. on Labor and Public Welfare, 83d Cong., 2d Sess.
90-91 (1954), XII Leg. Hist. at 975-76. Presumably, in referring to
``other statutes,'' Dr. Crawford was referring to the legislation
authorizing USDA to establish identity standards for ``raw and
processed'' foods. 7 U.S.C. 414. Under that authority, USDA had set
identity standards for dried fruits, including ``processed raisins,''
as processed foods. 7 CFR 52.1841 (1953).
Congress briefly revisited this issue in the 1994 Appropriations
Bill by barring EPA from spending any money to treat dried hops as a
processed food. Pub. L. No. 103-124, Title III, 107 Stat. 1275, 1295
(1993). The legislative history of this measure suggests that Congress
believed that EPA had misclassified dried hops given that EPA had
treated many other dried commodities (principally, grains) as RACs. 139
Cong. Rec. S12179, S12204 (1993). As a result of the congressional
action, EPA issued guidance stating it would treat dried hops as a RAC.
PR Notice 93-12 (December 23, 1993).
B. Possible Interpretations
Application of the term RAC is difficult because of the many
variations in drying practices. Some crops are dried while still on the
vine; others are harvested but left to dry in the field or elsewhere on
the farm. Still other crops are dried off the farm in some other
location. Many crops are dried at more than one of the above stages.
Crops also receive different degrees of drying: for some crops drying
results in minimal moisture reduction and for others the moisture
reduction is significant. Further, the drying process can be a natural
process, an artificial process designed to emulate natural drying, or a
wholly artificial process which achieves greater moisture reduction
than natural drying. On many occasions, artificial drying is used to
speed the natural drying process. Finally, the purposes of drying can
differ. In many instances crops are dried as a routine part of storage
and transportation. Other crops, however, are dried for the purpose of
creating a separately marketable commodity.
The statute does not clearly address the drying issue. As noted, a
RAC is defined as ``any food in its raw or natural state, including all
fruits that are washed, colored, or otherwise treated in their unpeeled
natural form prior to marketing.'' 21 U.S.C. 321(r) (emphasis added). A
dried commodity probably could not considered to be ``raw,'' but could
be construed to be ``natural.'' Further, the drying of a commodity may
qualify as a form of treatment of a commodity in its ``unpeeled natural
form.'' On the other hand, Congress in 1958 included ``dehydration'' in
a list in FFDCA sec. 402 of procedures intended to exemplify
processing. All drying could be regard as dehydrating, and thus a
processing step which converts a RAC to a non-RAC processed food.
However, if all drying is regarded as processing this appears to read
the term ``natural'' out of the statute because it is difficult to
identify foods other than dried commodities which could qualify as non-
raw natural foods.
The legislative history further clouds the issue. Congress listed
two commodities that are commonly dried to some extent, grains and
nuts, as RACs. Drying of these commodities occurs by both natural and
artificial means. However, the Senate specified that sun-drying or
artificial dehydration of fruits removed dried fruits from the RAC
category.
EPA has concluded that the statutory guidance provided on this
issue is ambiguous. Congress clearly thought some dried commodities
would be RACs and others not, but Congress gave EPA little instruction
on how to draw the dividing line. With respect to crops allowed to dry
on the plant before cutting or harvesting, EPA believes the only
reasonable interpretation of the statute is that such commodities are
RACs. With respect to crops dried after harvest, EPA considered four
approaches to the classification of commodities dried after harvest,
which EPA believes are reasonable constructions of the statute. These
interpretations are based on the method of drying, the degree of
drying, and the purpose of drying.
The first interpretation draws a distinction between RAC drying and
non-RAC dehydration based on whether the drying is done by natural or
mechanical or artificial means. This approach is based on the fact
that, in the statute, the term dehydration is grouped with a number of
processes (canning, cooking, freezing, and milling) which generally
involve mechanical or artificial as opposed to natural processes. This
interpretation, however appears inconsistent with the legislative
[[Page 2388]]
history and general purpose of the legislation. The legislative history
indicates that two crops that are commonly dried, grains and nuts,
should be treated as RACs. However, because most crops that are dried
frequently receive a mix of natural and artificial drying, most dried
crops, including grains and nuts, would be excluded from section 408
under this interpretation. Additionally, this interpretation is not
only inconsistent with Congress' specific direction regarding grains
and nuts but with Congress' understanding of section 408 as a
comprehensive provision addressing pesticides. Finally, this
interpretation--focusing on whether the drying was accomplished by
natural or artificial means--would present difficult implementation and
enforcement issues. Where the same crop can be dried either naturally
or artificially, different lots of the same commodity could be
classified differently. From an enforcement perspective, this approach
would be unworkable since it is impossible to determine, for example,
whether a particular lot of peanuts was dried naturally or
artificially.
The second and third alternative interpretations attempt to draw
the dividing line between drying and dehydration based on the degree of
drying. The second interpretation would categorize as a RAC food which
is dried by natural processes (e.g., sunlight) or by an artificial
process that emulates the result achieved by natural drying. Any drying
that removed more water from the product than could be achieved
naturally would be categorized as the processing step dehydration.
This interpretation would shift dried fruits such as raisins from
the category of processed food to RAC. As such, it is inconsistent with
the direct statement in the Senate committee report on dried fruits.
The third interpretation divides dried foods into RAC and non-RAC
foods based solely on the degree of moisture removal that occurs during
drying. EPA's experience is that there are two general groups of
commodities that are dried: first, the grains, certain legumes (e.g.,
dried beans and peas), and nuts which are harvested with a moisture
content in the range of roughly 15 to 30 percent and are dried to a
range of roughly 10 to 20 percent; and second, crops such as fruits,
hops, and hays which have a relatively high moisture content at harvest
(usually greater than 60 percent) yet are dried to a similar level as
the first group. Under the third interpretation, only the significant
drying that occurs with this second group (fruits, hops, and hay) would
be considered as converting a RAC to a non-RAC processed food. This
interpretation shows fidelity to the Senate committee report language
on dried fruit, but would require EPA to reclassify two commodities
currently classified as raw. First, dried hops would have to be
reclassified as a processed food only shortly after Congress barred EPA
from regulating dried hops under such a classification. Second, hay
would become a processed food. Although the cultural practices in the
drying of hay are very similar to raisins, it would seem to strain the
common vernacular to speak of hay as a processed food and not as food
in its raw or natural state.
The last interpretation draws a distinction between routine drying
for storage and transportation purposes and drying intended to create a
new product. Under this approach, grains and nuts, and similar
commodities such as legumes, hays, and hops, would be treated as RACs
because such commodities are routinely dried for storage or
transportation purposes. Dried fruits would not be RACs because the
drying of these commodities would be done to create a distinct
commodity. This approach treats the Senate report's reference to dried
fruit not as an example of a process (drying) that removes a food from
the RAC category but as a type of food (newly created food products)
that would not be considered RACs. Admittedly, this approach is not
explicitly endorsed in the legislative history, but this approach does
harmonize the various references to specific commodities in the
legislative history.
IV. EPA's Interpretation
EPA intends to follow the fourth interpretation that focuses on
whether the drying is routinely intended for storage or transportation
purposes or is designed to create a new commodity (e.g., converting
fresh grapes into raisins). EPA believes this approach best harmonizes
the potential conflict between the terms ``natural'' and
``dehydrating'' in the statute, is fully consistent with the
legislative history, and, with only one exception (dried hops), mirrors
FDA's and EPA's practice over the last 37 years. EPA would note that,
as to the one instance in which this interpretation is inconsistent
with FDA's and EPA's historical practice (i.e., dried hops), Congress
has quite strongly suggested only recently that EPA's classification of
that commodity was incorrect and EPA promptly reclassified the
commodity.
V. Impacts of EPA Interpretation
The determination that a food or feed commodity is raw or processed
assumes significance and has potential impacts only because of the
Delaney clause of section 409 of the FFDCA, which prohibits the
establishment of processed food tolerances for a pesticide which
induces cancer in man or animals.
This interpretation is unlikely to have human health impacts,
because EPA would act under its other statutory authorities to revoke
any pesticide tolerance (and remove the use) that it determined posed
unreasonable risks.
Each of the interpretations considered by the Agency has potential
economic impacts upon some commodities. The interpretation defines the
universe of commodities potentially subject to the Delaney clause
because they are processed. It is not possible to quantify impacts
attributable to the various interpretations, however, because other
factors are considered in determining whether the Delaney clause
actually applies to a processed food tolerance. EPA has discussed those
factors more fully in its policy statement on concentration and the
definition of ``ready-to-eat,'' issued on June 14, 1995 (60 FR 31300).
The first interpretation, which delineates commodities by type of
drying, would leave significant uncertainty about the status of a
commodity, since a single commodity could be both raw and processed.
For regulatory and enforcement purposes, EPA and FDA would have to
treat commodities such as nuts and grains as processed, which would
increase the universe of processed commodities potentially subject to
the Delaney clause.
The second interpretation would have the least potential economic
impact, since it would treat as processed only those commodities dried
beyond natural drying. Under this interpretation, dried fruits would
likely be treated as RACs, thereby removing them from any potential
Delaney impacts, and no current RACs would become processed
commodities.
The third interpretation, focussed on the degree of drying, could
have the highest potential economic impact. Commodities currently
classified as raw which are significantly dried, such as hops and hay,
would become processed commodities, while no commodities currently
classified as processed would become RACs.
EPA's interpretation, which is based upon the purpose of drying,
and which maintains the current classification of all commodities, has
potentially
[[Page 2389]]
significant impacts upon dried fruits, which are retained as processed
commodities.
Under EPA's interpretation, for example, tolerances for raisins as
processed foods are subject to the Delaney clause. Under current Agency
policies, 8 pesticides (2 insecticides and 6 fungicides) used on grapes
that may be processed into raisins could be subject to revocation. If
all 8 tolerances are revoked and the uses canceled, EPA's best estimate
of the aggregate first year impact to grape growers who use these
pesticides is $110 million ($69 million for insecticides and $41
million for fungicides). This estimated impact is for all types of
grapes, including those grown for raisins, and represents about 5% of
the total value of U.S. grape production. As noted above, because there
are numerous other factors which determine whether the Delaney clause
actually applies to a processed food tolerance, these impacts could be
significantly less.
VI. Regulatory Assessment Requirements
A. Executive Order 12866
Under Executive Order 12866 (50 FR 51735, October 4, 1993), it has
been determined that this interpretive rule is a ``significant
regulatory action'' because it may raise novel policy issues arising
out of legal mandates. Therefore, this interpretive rule was submitted
to the Office of Management and Budget (OMB) for review and any changes
made during OMB review have been documented in the public record.
B. Regulatory Flexibility Act
This interpretive rule has no direct impact on any entity,
including small entities. As noted above, any adverse impacts arise
indirectly and solely because of the application of the Delaney clause.
Moreover, this interpretive rule does not change the status of any
current commodity. I therefore certify that this interpretive rule does
not require a separate Impact Analysis under the Regulatory Flexibility
Act.
List of Subjects
Environmental protection, Administrative practice and procedure,
Agricultural commodities, Feed additives, Food additives, Pesticides
and pests, Reporting and recordkeeping requirements
Dated: January 19, 1996.
Lynn R. Goldman,
Assistant Administrator for Prevention, Pesticides and Toxic
Substances.
[FR Doc. 96-1213 Filed 1-22-96; 3:59 pm]
BILLING CODE 6560-50-F
