98-21480. Irish Potatoes Grown in Colorado; Exemption From Area No. 2 Handling Regulation for Potatoes Shipped for Experimentation and the Manufacture or Conversion Into Specified Products  

  • [Federal Register Volume 63, Number 154 (Tuesday, August 11, 1998)]
    [Rules and Regulations]
    [Pages 42686-42688]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 98-21480]
    
    
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    DEPARTMENT OF AGRICULTURE
    
    Agricultural Marketing Service
    
    7 CFR Part 948
    
    [Docket No. FV98-948-2 IFR]
    
    
    Irish Potatoes Grown in Colorado; Exemption From Area No. 2 
    Handling Regulation for Potatoes Shipped for Experimentation and the 
    Manufacture or Conversion Into Specified Products
    
    AGENCY: Agricultural Marketing Service, USDA.
    
    ACTION: Interim final rule with request for comments.
    
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    SUMMARY: This interim final rule exempts shipments of potatoes handled 
    for experimentation and the manufacture or conversion into specified 
    products from the grade, size, maturity, and inspection requirements 
    prescribed under the handling regulations of the Colorado Potato 
    Marketing Order for Area No. 2 (San Luis Valley). This rule was 
    unanimously recommended by the Colorado Potato Administrative Committee 
    for Area No. 2 (Committee), the agency responsible for local 
    administration of the marketing order. This rule is designed to expand 
    markets for potatoes and to increase fresh utilization. These changes 
    are expected to improve the marketing of Colorado potatoes and increase 
    returns to producers.
    
    DATES: Effective August 12, 1998; comments received by October 13, 1998 
    will be considered prior to issuance of a final rule.
    
    ADDRESSES: Interested persons are invited to submit written comments 
    concerning this rule. Comments must be sent to the Docket Clerk, Fruit 
    and Vegetable Programs, AMS, USDA, room 2525-S, PO Box 96456, 
    Washington, DC 20090-6456; Fax: (202) 205-6632. All comments should 
    reference the docket number and the date and page number of this issue 
    of the Federal Register and will be made available for public 
    inspection in the Office of the Docket Clerk during regular business 
    hours.
    
    FOR FURTHER INFORMATION CONTACT: Dennis L. West, Northwest Marketing 
    Field Office, Marketing Order Administration Branch, Fruit and 
    Vegetable Programs, AMS, USDA, 1220 SW Third Avenue, room 369, 
    Portland, Oregon 97204; telephone: (503) 326-2724, Fax: (503) 326-7440; 
    or George J. Kelhart, Marketing Order Administration Branch, Fruit and 
    Vegetable Programs, AMS, USDA, Room 2525-S, PO Box 96456, Washington, 
    DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205-6632. Small 
    businesses may request information on compliance with this regulation 
    by contacting Jay Guerber, Marketing Order Administration Branch, Fruit 
    and Vegetable Programs, AMS, USDA, room 2525-S, PO Box 96456, 
    Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205-
    6632.
    
    SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
    Agreement No. 97 and Marketing Order No. 948 (7 CFR part 948), both as 
    amended, regulating the handling of Irish potatoes grown in Colorado, 
    hereinafter referred to as the ``order.'' The order is authorized by 
    the Agricultural Marketing Agreement Act of 1937, as amended, (7 U.S.C. 
    601-674), hereinafter referred to as the ``Act.''
        The Department of Agriculture (Department) 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 the Secretary 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 on the 
    petition. After the hearing the Secretary would rule on the
    
    [[Page 42687]]
    
    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 the 
    Secretary's ruling on the petition, provided an action is filed not 
    later than 20 days after date of the entry of the ruling.
        This rule exempts shipments of potatoes handled for the purposes of 
    experimentation and the manufacture or conversion into specified 
    products from the grade, size, maturity, and inspection requirements 
    prescribed under the order's handling regulations for Area No. 2 (San 
    Luis Valley).
        Section 948.22 authorizes the issuance of regulations for grade, 
    size, quality, maturity, and pack for any variety or varieties of 
    potatoes grown in different portions of the production area during any 
    period. Section 948.23 authorizes the issuance of regulations that 
    modify, suspend, or terminate requirements issued under Sec. 948.22 or 
    to facilitate the handling of potatoes for special purposes. Section 
    948.24 requires adequate safeguards to be prescribed to ensure that 
    potatoes handled pursuant to Sec. 948.23 enter authorized trade 
    channels. Safeguard procedures for special purpose shipments are 
    specified in Secs. 948.120 through 948.125.
        At its meeting on June 18, 1998, the Committee unanimously 
    recommended that handlers of potatoes shipped for experimentation and 
    for the manufacture or conversion into specified products be exempted 
    from the grade, size, maturity, and inspection requirements prescribed 
    under the order's handling regulations for Area No. 2 in Sec. 948.386. 
    The Committee recommended that experimentation and manufacture or 
    conversion into specified products be added under Sec. 948.386(d)(2) as 
    special purpose shipments.
        As is currently required for all special purpose shipments, 
    handlers would apply and obtain Certificates of Privilege for handling 
    such potatoes and furnish the Committee such information as the 
    Committee may require.
        Several producers and handlers within the production area are 
    attempting to develop new fresh uses for potatoes using experimental 
    varieties and packs. The Committee also anticipates that some handlers 
    may want to ship experimental varieties, or traditional varieties, for 
    use in the manufacture or conversion into special products, or perform 
    the manufacture or conversion themselves prior to shipment. Handlers 
    are, for example, attempting to develop new special products such as 
    fresh cut potatoes shipped in vacuum sealed bags. The Committee 
    strongly encourages innovation that could result in the development of 
    new varieties, markets, or opportunities for fresh potatoes that would 
    be good for the Colorado potato industry. Some of the new varieties 
    have irregular shapes or are small in size, and that prevents them from 
    being shipped except under the minimum quantity exemption of 1,000 
    pounds specified in paragraph (f) of Sec. 948.386. This has prevented 
    handlers from shipping larger quantities. Handlers have also expressed 
    a desire to experiment with the shipment of potatoes of different 
    varieties in the same container. This is not currently possible because 
    the potatoes do not meet the minimum grade requirement that a 
    particular lot of potatoes have ``similar'' varietal characteristics.
        For the purpose of this action, the term ``manufacture or 
    conversion into specified products'' means the preparation of potatoes 
    for market into products by peeling, slicing, dicing, applying material 
    to prevent oxidation, or other means approved by the Committee, but not 
    including other processing. Under the current regulation, potatoes for 
    manufacture or conversion into products must be inspected and certified 
    as meeting specified quality requirements prior to preparation for 
    market. This action will exempt shipments handled for experimentation 
    or the manufacture or conversion into products from these requirements, 
    thus, relieving handlers of this regulatory burden.
        These changes to the Area No. 2 handling regulation are expected to 
    encourage new product development and could lead to market expansion 
    which would benefit producers, handlers, buyers, and consumers of 
    Colorado potatoes.
        The special purpose shipments authorized by this action are fresh 
    use markets so it is appropriate that the handlers taking advantage of 
    the exemptions be assessed to defray the costs the Committee incurs in 
    administering the program, tracking such shipments, in determining 
    whether applicable requirements have been met, and in determining 
    whether the potatoes ended up in the proper trade channel. This rule is 
    designed to expand markets for potatoes and to increase fresh 
    utilization. These changes are expected to improve the marketing of 
    Colorado potatoes and increase returns to producers.
        Pursuant to requirements set forth in the Regulatory Flexibility 
    Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
    economic impact of this action on small entities. Accordingly, the AMS 
    has prepared this initial regulatory flexibility analysis.
        There are approximately 100 handlers of Colorado Area No. 2 
    potatoes who are subject to regulation under the marketing order and 
    approximately 285 producers of Colorado potatoes in the regulated area. 
    Small agricultural service firms have been defined by the Small 
    Business Administration (13 CFR 121.601) as those having annual 
    receipts of less than $5,000,000, and small agricultural producers are 
    defined as those whose annual receipts are less than $500,000. The 
    majority of potato producers and handlers regulated under the marketing 
    agreement and order may be classified as small entities.
        This rule exempts shipments of potatoes handled for experimentation 
    and the manufacture or conversion into specified products from the 
    grade, size, maturity, and inspection requirements that are prescribed 
    under the order's handling regulations for Area No. 2 in Sec. 948.386.
        At its meeting on June 18, 1998, the Committee unanimously 
    recommended that potatoes shipped for the purposes of experimentation 
    and for the manufacture or conversion into specified products be 
    considered special purpose shipments and be exempt from the grade, 
    size, maturity, and inspection requirements prescribed in Sec. 948.386. 
    The Committee recommended that experimentation and manufacture or 
    conversion into specified products be added under Sec. 948.386(d)(2) as 
    special purpose shipments.
        As is currently required for all special purpose shipments, 
    handlers would apply and obtain Certificates of Privilege for handling 
    such potatoes and furnish the Committee such information as the 
    Committee may require to track such shipments, determine whether 
    applicable requirements have been met, and whether proper disposition 
    has occurred.
        Several producers and handlers within the production area are 
    attempting to develop new fresh uses for potatoes using experimental 
    varieties and packs. The Committee also anticipates that some handlers 
    may want to ship experimental varieties, or traditional varieties, for 
    use in the manufacture or conversion into special products, or perform 
    the manufacture or conversion themselves prior to shipment. Handlers 
    are, for example, attempting to develop new special products such as 
    fresh cut potatoes shipped in vacuum sealed bags. The Committee 
    strongly encourages innovation that could result in the
    
    [[Page 42688]]
    
    development of new varieties, markets, or opportunities for fresh 
    potatoes that would be good for the Colorado potato industry. Some of 
    the new varieties have characteristics, such as small size or misshape, 
    that prevent them from being shipped fresh except under the minimum 
    quantity exemption of 1,000 pounds in paragraph (f) of Sec. 948.386. 
    This has placed a burden on handlers desiring to ship larger quantities 
    of such potatoes. Handlers have also expressed a desire to experiment 
    with the shipment of potatoes of different varieties in the same 
    container. This is not currently possible because the potatoes do not 
    meet the minimum grade requirement that a particular lot of potatoes 
    have ``similar'' varietal characteristics.
        For purpose of this action, the term ``manufacture or conversion 
    into specified products'' means the preparation of potatoes for market 
    into products by peeling, slicing, dicing, applying material to prevent 
    oxidation, or other means approved by the Committee, but not including 
    other processing.
        These changes to the handling regulation are expected to encourage 
    new product development and could lead to market expansion which would 
    benefit producers, handlers, buyers, and consumers of Colorado 
    potatoes.
        The special purpose outlets authorized by this action are fresh use 
    markets so it is appropriate that handlers taking advantage of the 
    exemptions be assessed to defray the costs the Committee incurs in 
    administering the program, tracking such shipments, determining whether 
    applicable requirements have been met, and whether the potatoes end up 
    in proper trade channels. Currently, the assessment rate is $0.0030 per 
    hundredweight of potatoes handled. Effective September 1, 1998, the 
    rate will be $0.0015 per hundredweight of potatoes handled. This rule 
    is designed to expand markets for potatoes and to increase fresh 
    utilization. The changes are expected to improve the marketing of 
    Colorado potatoes and increase returns to producers.
        There is no available information detailing how many potatoes this 
    relaxation will allow to be marketed.
        No viable alternatives to this action were identified that would 
    ensure that innovations in marketing and product development. 
    Furthermore, the goals expressed by the committee could not be solved 
    absent this action.
        The Committee estimates that three or four handlers may apply for 
    and obtain Certificates of Privilege for the handling of potatoes for 
    experimentation or for the manufacture or conversion into specified 
    products. It is estimated that the time taken by the handlers who apply 
    will total less than ten hours and this time is currently approved 
    under OMB No. O581-0111 by the Office of Management and Budget (OMB) in 
    accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 
    35).
        As with all Federal marketing order programs, reports and forms are 
    periodically reviewed to reduce information requirements and 
    duplication by industry and public sectors. In addition, the Department 
    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 Colorado potato industry and all interested persons were invited to 
    attend the meeting and participate in Committee deliberations. Like all 
    Committee meetings, the June 18, 1998, meeting was a public meeting and 
    all entities, both large and small, were able to express their views on 
    this issue. The Committee itself is composed of 12 members, of which 5 
    are handlers and 7 are producers, the majority of whom are small 
    entities.
        Finally, interested persons are invited to submit information on 
    the regulatory and informational impacts of this action on small 
    businesses.
        After consideration of all relevant material presented, including 
    the Committee's recommendation, and other information, it is found that 
    this interim final rule, as hereinafter set forth, will tend to 
    effectuate the declared policy of the Act.
        This rule invites comments on a change to the handling regulation 
    prescribed for Area No. 2 under the Colorado potato marketing order. 
    Any comments received will be considered prior to finalization of this 
    rule.
        Pursuant to 5 U.S.C. 553, it is also found and determined upon good 
    cause that it is impracticable, unnecessary, and contrary to the public 
    interest to give preliminary notice prior to putting this rule into 
    effect and that good cause exists for not postponing the effective date 
    of this rule until 30 days after publication in the Federal Register 
    because: (1) This rule relaxes requirements on Area No. 2 handlers and 
    provides additional marketing opportunities; (2) this action must be 
    taken promptly so handlers can take advantage of the additional 
    marketing opportunities as soon as possible; (3) the Committee 
    unanimously recommended these changes at a public meeting and 
    interested parties had an opportunity to provide input; and (4) this 
    rule provides a 60-day comment period and any comments received will be 
    considered prior to finalization of this rule.
    
    List of Subjects in 7 CFR Part 948
    
        Marketing agreements, Potatoes, Reporting and recordkeeping 
    requirements.
    
        For the reasons set forth in the preamble, 7 CFR part 948 is 
    amended as follows:
    
    PART 948--IRISH POTATOES GROWN IN COLORADO
    
        1. The authority citation for 7 CFR part 948 continues to read as 
    follows:
    
        Authority: 7 U.S.C. 601-674.
    
        2. In Sec. 948.386, paragraph (d)(2) is revised, and in paragraph 
    (g) a new sentence is added before the last sentence to read as 
    follows:
    
    
    Sec. 948.386  Handling regulation.
    
    * * * * *
        (d) * * *
        (1) * * *
        (2) The grade, size, maturity and inspection requirements of 
    paragraphs (a), (b), and (c) of this section shall not be applicable to 
    shipments of potatoes for experimentation, the manufacture or 
    conversion into specified products, or for seed pursuant to section 
    948.6, but such shipments shall be subject to assessments.
    * * * * *
        (g) Definitions. * * * The term manufacture or conversion into 
    specified products means the preparation of potatoes for market into 
    products by peeling, slicing, dicing, applying material to prevent 
    oxidation, or other means approved by the committee, but not including 
    other processing. * * *
    
        Dated: August 5, 1998.
    Robert C. Keeney,
    Deputy Administrator, Fruit and Vegetable Programs.
    [FR Doc. 98-21480 Filed 8-10-98; 8:45 am]
    BILLING CODE 3410-02-P
    
    
    

Document Information

Effective Date:
8/12/1998
Published:
08/11/1998
Department:
Agricultural Marketing Service
Entry Type:
Rule
Action:
Interim final rule with request for comments.
Document Number:
98-21480
Dates:
Effective August 12, 1998; comments received by October 13, 1998 will be considered prior to issuance of a final rule.
Pages:
42686-42688 (3 pages)
Docket Numbers:
Docket No. FV98-948-2 IFR
PDF File:
98-21480.pdf
CFR: (1)
7 CFR 948.386