[Federal Register Volume 62, Number 169 (Tuesday, September 2, 1997)]
[Rules and Regulations]
[Pages 46175-46179]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-23307]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1207
[FV-96-703IFR]
Potato Research and Promotion Plan; Suspension of Portions of the
Plan; Amendments of the Regulations Regarding Importers' Votes; and
Clarification of Reporting Requirements
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
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SUMMARY: This rule will suspend portions of the Potato Research and
Promotion Plan (Plan) that require National Potato Promotion Board
(Board) members be nominated at meetings, suspends obsolete provisions
in the Plan, amends the rules and regulations issued under the Plan to
provide for mail balloting as an alternative means of selecting
nominees for appointment, permits importer members of the Board to vote
on the basis of the volume of imported potatoes, and provides in the
rules and regulations that designated handlers must report to the Board
those potatoes of their own production for which the assessment has
been paid by another designated handler.
DATES: Effective September 3, 1997. Comments must be received by
November 3, 1997.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposed rule to: Docket Clerk, Research and Promotion
Branch, Fruit and Vegetable Division, Agricultural Marketing Service,
USDA, STOP Code 0244, 1400 Independence Avenue, SW, Washington, DC
20250-0244, fax (202) 205-2800. Three copies of all written material
should be submitted. Comments will be made available for public
inspection at the Research and Promotion Branch during regular business
hours. All comments should reference the docket number and the date and
page number of this issue of the Federal Register.
FOR FURTHER INFORMATION CONTACT: Georgia C. Abraham, Research and
Promotion Branch, Fruit and Vegetable Division, AMS, USDA, STOP Code
0244, 1400 Independence Avenue, SW, Washington, DC 20250-0244;
telephone (202) 720-5057 or (888) 720-9917 (toll free).
SUPPLEMENTARY INFORMATION: This rule is issued under the Potato
Research and Promotion Plan (Plan) [7 CFR Part 1207]. The Plan is
authorized by the Potato Research and Promotion Act, as amended [7
U.S.C. 2611-2627], hereinafter referred to as the Act.
Executive Order 12988
This 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.
The Act provides that administrative proceedings must be exhausted
before parties may file suit in court. Under section 311 of the Act, a
person subject to a plan may file a petition with the Secretary of
Agriculture (Secretary) stating that such plan, any provision of such
plan, or any obligation imposed in connection with such plan is not in
accordance with law; and requesting a modification of the plan or an
exemption from the plan. Such person is afforded the opportunity for a
hearing on the petition. After the hearing, the Secretary will rule on
the petition. The Act provides that the district court of the United
States in any district in which such person is an inhabitant, or has
principal place of business, has jurisdiction to review the Secretary's
ruling on the petition, provided that a complaint is filed within 20
days after the date of entry of the ruling.
Executive Order 12866 and Regulatory Flexibility Act
This rule has been determined not significant for purposes of
Executive Order 12866 and, therefore, has not been reviewed by the
Office of Management and Budget.
In accordance with the Regulatory Flexibility Act [5 U.S.C. 601 et
seq.]
[[Page 46176]]
(RFA), the Agency is required to examine the impact of this rule on
small entities. Accordingly, we have performed this initial regulatory
flexibility analysis.
According to data from the 1992 Census of Agriculture, published by
the Department of Commerce, there are approximately 6,744 potato
producers who grow potatoes on 5 or more acres and are thus subject to
the provisions of the Plan. Of these, approximately 4,817 potato
producers may be classified as small agricultural producers. Small
agricultural producers are defined by the Small Business Administration
[13 CFR 121.601] as those having annual receipts of less than $500,000.
Therefore, the majority of potato producers may be classified as small
entities.
According to data from the Board, there are an estimated 1,511
potato handlers, 334 importers of potatoes and potato products for
human consumption, and 27 importers of seed potatoes who are subject to
the provisions of the Plan. Small agricultural service firms are
defined by the Small Business Administration [13 CFR 121.601] as those
whose annual receipts are less than $5 million. For the purpose of this
analysis, it is concluded that the majority of potato handlers and
importers are small entities.
According to data from USDA's National Agricultural Statistics
Service (NASS), potato production in the United States for 1996 totaled
497 million hundredweight (cwt). Idaho leads the U.S. in the production
of potatoes with 28.2 percent of this total, followed by Washington
with 19.1 percent. Colorado, Oregon, Wisconsin, and North Dakota each
produce about 6 percent of the total U.S. production. Other major
producing states in 1996 were Minnesota (4.9 percent), Maine (4.3
percent), Michigan (2.8 percent), and California (3.1 percent).
Florida, New York, and Nebraska each produced between 1 and 2 percent
of total U.S. production, and all other states produced less than 1
percent each.
Using preliminary data from NASS that shows an average U.S. farm
price for potatoes in 1996 was $5.11 per cwt., the value of the 1996
U.S. potato crop is estimated at $2.54 billion.
Exports of all types of potatoes and potato products during 1996
totaled approximately 39 million cwt. on a fresh-weight basis. East
Asia and the Pacific Rim countries are the largest market for frozen
potatoes and frozen french fries, while Canada is the largest market
for exports of U.S. tablestock and seed potatoes.
Imports of tablestock, seed potatoes, and processed potatoes
(frozen, canned, chips, etc.) for 1996 totaled 24 million cwt. on a
fresh-weight basis. Tablestock, seed potatoes, and frozen potato
products accounted for about 93 percent of the total value of potato
imports, and over 99 percent of these items came from Canada.
The Board administers a national program of research, development,
advertising, and promotion designed to strengthen potatoes' competitive
position and to maintain and expand domestic and foreign markets for
potatoes and potato products. The program is financed by assessments on
producers of 5 or more acres of potatoes (collected by the first
handler) and on all imported fresh or processed potatoes for human
consumption and seed potatoes (collected by the U.S. Customs Service).
The Secretary has oversight responsibility for the Board's activities.
There are currently 107 Board members--102 producers; 4 importers; and
1 public member--who are appointed by the Secretary to serve a 3-year
term on the Board. Approximately one-third of the members' terms of
office expire each year on the last day of February.
This action will suspend portions of the Plan and amend the rules
and regulations issued under the Plan.
The suspension of portions of the Plan will eliminate the
requirement that industry members be nominated for appointment to the
Board only at meetings of producers or importers. The rules issued
under the Plan are also being amended to provide mail balloting as an
alternative means of selecting nominees for appointment.
The Plan currently requires nominations for producer and importer
members be submitted to USDA by November 1 of each year for
appointments to be made by the Secretary by March 1 of the following
year. In order to provide the largest number of producers an
opportunity to participate, nomination meetings are typically held in
conjunction with meetings of state or local potato or vegetable
industry organizations, usually late in the fall after harvesting.
However, in many cases, this places nomination meetings close to or
after the November 1 deadline for submitting nominations to USDA.
Additionally, in some states, potato production may be in widely
separated locations, posing a hardship for growers to attend meetings.
In some cases, growers must travel several hundred miles and incur the
expense of an overnight stay in order to participate in a nomination
meeting. In these cases, attendance at meetings has suffered.
Nomination meetings for importer members have been conducted by the
Board at its office in Denver, Colorado. Although Denver is a central
location for this meeting, all importers have had to fly to Denver to
attend a 1-hour meeting.
For several years, the Board has discussed this problem with USDA.
At its January 1997 meeting, the Board's Administrative Committee,
acting on behalf of the Board, voted to recommend to USDA that action
be taken to suspend portions of the Plan and to amend the rules and
regulations to permit members of the potato industry the flexibility to
choose the manner of nominating candidates for appointment. Providing
the option of a mail ballot for nominating candidates will provide an
opportunity for a greater number of industry members to participate in
the nomination process. In some cases, the burden and expense for
producers to travel long distances to attend a nomination meeting will
be eliminated. Permitting an optional means of nominating importer
members will also eliminate the time and expense currently incurred for
importers to participate in these meetings. Additionally, nomination
activity will not have to be coupled with industry meetings, thus
permitting the nomination process to take place early enough that the
nominees' applications for appointment can be forwarded to USDA well
before the November 1 deadline.
If these changes are not made, producers and importers will
continue to incur financial and time loss to attend and participate in
nomination meetings, and attendance at these meetings will continue to
suffer.
The second amendment to the rules and regulations will permit
importer members of the Board to vote on the basis of the volume of
imported potatoes, processed potato products, and seed potatoes in the
same manner as producer members of the Board vote on the basis of
domestic potato production. Since the program's inception, the Plan has
permitted producer members to call for a vote by the production of each
State. In the 1990 Farm Bill, Congress amended the Act to, along with
other changes, include imported potatoes and potato products for human
consumption and seed potatoes under the program's provisions. When the
Plan and rules and regulations were amended to conform with the amended
Act, a provision permitting importers to vote on the basis of the
volume of imported
[[Page 46177]]
potatoes was inadvertently omitted. In production votes taken by the
Board since imports were included in the program's provisions,
importers have voted the volume of potato imports on a fresh-weight
basis.
This amendment will correct the oversight and include provisions in
the regulations to reflect the procedure currently in practice.
Importers' votes carry the same proportional weight as producers' votes
and will result in equitable treatment of importers.
The third amendment will specify in the rules and regulations that
the designated handlers of potatoes must report to the Board those
potatoes of their own production for which the assessment has been paid
by another first handler.
The regulations currently require designated handlers of potatoes
to report and pay assessments on the potatoes of someone else's
production that they handle. In some cases, designated handlers are
also producers, and the assessment for their potato production may be
paid by another designated handler. For example, a processor who
purchases field-run potatoes is considered the designated handler and
is responsible for reporting to the Board and paying assessments on
those potatoes even though the producer may also be a designated
handler who is also submitting reports and assessments to the Board. In
order for the Board to assure that all handling has been reported and
assessments have been paid and credited to the producer, the Board must
be able to cross-reference the handling of potatoes on the reports of
both designated handlers.
The authority for this information collection exists in
Sec. 1207.350 of the Plan. It is necessary to provide in the text of
the regulation concerning designated handlers' reporting
responsibilities that designated handlers must report to the Board
those potatoes of their own production for which the assessment has
been paid by another designated handler. The information collection
burden and the form used to collect the information on handling of
potatoes have been reviewed and approved by the Office of Management
and Budget (OMB) under approval number 0581-0093. The 1-hour-per-
response burden currently approved includes the time necessary for
designated handlers to provide information on assessments paid by
another designated handler on the reporting form submitted no more
often than monthly. This information is readily available from the
confirmation each designated handler is required to provide to
producers on the amount of assessments paid on their behalf.
In addition, this rule suspends obsolete provisions in the Plan
referring to meetings, nomination of the initial Board, and references
to importer organizations.
As with all Federal research and promotion programs, reports and
forms are periodically reviewed to reduce information requirements and
duplication by industry and public sector agencies.
This rule permits importer members of the Board to vote on the
basis of the volume of imported potatoes. This revision will not affect
the estimated burden on potato growers or designated handlers.
The Department has not identified any relevant Federal rules that
duplicate, overlap, or conflict with this rule.
The changes contained in this action suspend obsolete provisions in
the Plan, provide for alternative means of nominating candidates for
appointment to the Board, provide importer members a vote by volume at
meetings, and clarify handlers' reporting requirements. These changes
will enhance the efficiency of the operation of the potato research and
promotion program, and will reduce the financial burden on industry
members when nominating candidates for appointment by the Secretary.
Accordingly, we believe that these revisions are the best alternatives
to facilitate the nomination process, provide for importer voting by
production, and to clarify handlers' reporting requirements.
Paperwork Reduction Act
This rule contains no new information collection or recordkeeping
requirements under the Paperwork Reduction Act of 1995 [44 U.S.C. 3501
et seq.]. The information collection and recordkeeping requirements
related to this action were previously approved by the Office of
Management and Budget (OMB) under number 0581-0093.
Eliminating the requirement that industry members be nominated to
serve on the Board at meetings and providing the alternative of mail
balloting will be less burdensome, overall, for potato producers and
importers, but the information collection burden remains the same. When
nominations are conducted by mail ballot rather than at a meeting, the
nomination ballot will be completed and mailed instead of being turned
in at a meeting.
The second amendment to the rules and regulations will permit
importer members of the Board to vote on the basis of the volume of
imported potatoes, processed potato products, and seed potatoes in the
same manner as producer members of the Board vote on the basis of
domestic potato production. This amendment will correct an oversight
and include provisions in the regulations to reflect procedures
currently in practice. Importers' votes carry the same proportional
weight as producers' votes and will result in equitable treatment of
importers. There is no burden associated with importers voting at board
meetings.
The third amendment provides in the rules and regulations that
designated handlers must report to the Board those potatoes of their
own production for which the assessments have been paid by another
handler. The information collection burden and the form used to collect
information on handling of potatoes have been reviewed and approved by
the OMB under approval number 0581-0093. The 1-hour-per-response burden
currently approved includes designated handlers providing information
on assessments paid by another designated handler on the reporting form
submitted no more often than monthly.
The form requires the minimum information necessary to effectively
carry out the requirements of the program, and its use is necessary to
fulfill the intent of the Act. Such information can be supplied without
data processing equipment or outside technical expertise. In addition,
there are no additional training requirements for individuals filling
out reports and remitting assessments to the promotion Board. The forms
are simple, easy to understand, and place as small a burden as possible
on the person required to file the information. This action will not
impose any additional reporting or recordkeeping requirements on either
small or large potato handlers.
Background
This action suspends portions of the Plan and amends three sections
of the rules and regulations issued under the Plan.
The suspension of portions of the Plan will eliminate the
requirement that industry members be nominated for appointment to the
Board only at a meeting of producers or importers. Other obsolete
provisions of the Plan will also be suspended. The rules issued under
the Plan will also be amended to provide an alternative means of
selecting nominees for appointment such as by a mail ballot of the
industry.
The Plan requires nominations for producer and importer members be
[[Page 46178]]
submitted to USDA by November 1 of each year for appointments to be
made by the Secretary by March 1 of the following year. In order to
provide the largest number of producers an opportunity to participate,
nomination meetings are typically held in conjunction with meetings of
state or local potato or vegetable industry organizations, usually
after harvesting. However, this places nomination meetings close to or
after the November 1 deadline for submitting nominations to USDA.
Additionally, in some states, potato production may be in widely
separated locations, posing a hardship for a grower--in some cases
traveling several hours and incurring the cost of an overnight trip--in
order to participate in a nomination meeting.
In the case of importer nominations, the Plan provided that the
Board could call upon organizations of potato, potato products, and/or
seed potato importers to assist in nominating importers for appointment
to the Board. This provision was intended to allow importers the
opportunity to nominate importer members from their own membership.
However, no such organizations have been found to exist, and the Board
has conducted importer nomination meetings in Denver. Importers must
therefore travel to Denver for nomination meetings.
For several years, the Board has discussed this problem with USDA.
At its January 1997 meeting, the Board's Administrative Committee,
acting on behalf of the Board, voted to recommend to USDA that action
be taken to suspend portions of the Plan and to amend the rules and
regulations to permit members of the potato industry the flexibility to
choose the manner of nominating candidates for appointment in a manner
that would provide for the ability for a greater number of industry
members to participate in the nomination process with less of a burden.
In order to do this, this action suspends wording referring to
meetings in Sec. 1207.322 of the Plan. Paragraph (a) of Sec. 1207.322
deals only with nomination of the initial Board and is thus obsolete.
Therefore, paragraph (a) is suspended in its entirety. References to
meetings are suspended in paragraphs (b) and (c).
Also, because no organizations of potato importers exist,
references to importer organizations are unnecessary and will be
suspended in Sec. 1207.322(d).
In addition, references in Sec. 1207.503 of the rules and
regulations to meetings and importer organizations have been removed
and amendments made to this section to provide the option of mail
balloting to nominate producers and importers for appointment to the
Board.
A second amendment to the rules and regulations deals with
importers being able to vote on the basis of the volume of the fresh-
weight equivalent of imported potatoes and potato products for human
consumption and seed potatoes in the same manner that producer members
can vote on the basis of potato production within each State.
One of the 1990 Farm Bill amendments to the Act [7 U.S.C. 2611 et
seq.] extended the Act's coverage to imported potatoes, potato
products, and seed potatoes and provided for importer representation on
the Board. When the Plan and rules and regulations issued under the
Plan were subsequently amended in 1991 to conform with the amended Act,
a provision permitting importer members to vote on the basis of the
volume of imported product was inadvertently overlooked. From the
program's inception, Sec. 1207.325 of the Plan authorized producer
members of the Board to call for a production vote in which the Board
members from each State are allocated votes based on that State's fresh
potato production (i.e., one vote for each 1 million hundredweight of
potatoes).
In production votes taken by the Board since imports were included
in the program's provisions, importers have voted the volume of potato
imports on a fresh-weight basis. At its March 1996 annual meeting, the
Board voted to amend the rules and regulations to correct this
oversight by amending Sec. 1207.505 to provide the same voting rights
as afforded to producer members.
The third amendment provides in the rules and regulations that
designated handlers must report to the Board those potatoes of their
own production for which the assessments have been paid by another
designated handler.
Section 1207.350(a) of the Plan provides authority for the Board to
prescribe in the regulations the information designated handlers must
report in order for the Board to perform its duties, and this
information is set forth in Sec. 1207.513 of the regulations. Some
designated handlers are also potato producers and, in some cases, the
assessment for their potato production may be paid by another
designated handler. For example, a processor who purchases field-run
potatoes is considered the designated handler and is responsible for
reporting to the Board and paying assessments on those potatoes even
though the producer may also be a designated handler who is also
submitting reports and paying assessments to the Board. In order for
the Board to assure that all handling has been reported and assessments
have been paid and credited to the producer, the Board must be able to
cross-reference the handling of potatoes on the reports of both
handlers. Since Sec. 1207.513 of the regulations does not specifically
state that designated handlers must report to the Board those potatoes
of their own production for which the assessments have been paid by
another designated handler, it is necessary to amend this section to
provide that handlers must report to the Board those potatoes of their
own production for which the assessment has been paid by another first
handler. Therefore, this action amends Sec. 1207.513 of the regulations
to provide for this reporting.
After consideration of all relevant material presented, including
the information and recommendation submitted by the Board, it is hereby
found that the suspended sections of the plan no longer tend to
effectuate the declared policy of the Act. In addition, it is found
that the amendments to the rules and regulations are necessary for the
appropriate administration of the Plan and the rules and regulations
and that they are consistent with the intention of the Act.
All written comments received in response to this rule by the date
specified herein will be considered prior to finalizing this action.
Pursuant to the provisions in 5 U.S.C. 553, it is 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 action until 30 days after
publication in the Federal Register because: (1) This action suspends
obsolete and unnecessary provisions of the Plan and clarifies
provisions in the regulations; (2) in addition, a time and travel
burden upon potato producers and importers will continue to be imposed
if they are not provided the option to nominate candidates for
appointment to the Board by mail ballots rather than only at meetings;
(3) nominations for the term of office beginning on March 1, 1998, will
begin soon; (4) a 60-day period is provided to allow interested parties
to comment prior to finalization; and (5) no useful purpose would be
served by a delay of the effective date.
List of Subjects in 7 CFR Part 1207
Advertising, Agricultural research, Marketing agreements, Potatoes,
Reporting and recordkeeping requirements.
[[Page 46179]]
For the reasons set forth in the preamble, 7 CFR part 1207 is
amended as follows:
PART 1207--POTATO RESEARCH AND PROMOTION PLAN
1. The authority citation for 7 CFR part 1207 continues to read as
follows:
Authority: 7 U.S.C. 2611-2627.
Sec. 1207.322 [Amended]
2. Section 1207.322 is amended by suspending:
(A) Paragraph (a) in its entirety,
(B) In paragraph (b), the words ``at meetings'' in the first
sentence and the entire last sentence,
(C) In paragraph (c), the entire last sentence, and
(D) In paragraph (d), the entire last two sentences of the
introductory text and paragraphs (d)(1) through (5).
3. In Sec. 1207.503, paragraphs (a), (b), and (c) are revised to
read as follows:
Sec. 1207.503 Nominations.
(a) Pursuant to Sec. 1207.322 of the plan, the Board shall assist
producers in producing sections or States each year to nominate
producer members for the Board. Such nominations may be conducted at
meetings or by mail ballots. One individual shall be nominated for each
position to become vacant. A list of nominees shall be submitted to the
Secretary for consideration by November 1 of each year.
(b) Pursuant to Sec. 1207.322 of the plan, the Board shall assist
importers each year to nominate importer members for the Board. Such
nominations may be conducted at meetings or by mail ballots.
(c) Nomination meetings or mail balloting shall be well publicized
with notice given to producers, importers, and the Secretary at least
10 days prior to each meeting or mailing of ballots.
* * * * *
4. Section 1207.505 is revised to read as follows:
Sec. 1207.505 Procedure.
(a) The procedure for conducting the Board's meetings shall be in
accordance with the bylaws adopted by the Board on June 7, 1972, and
approved by the Secretary and any subsequent amendments adopted by the
Board and approved by the Secretary.
(b) Each importer member shall be entitled to not less than one
vote. Importer members shall also be entitled to one additional vote
for each 1 million hundredweight, or major fraction thereof, on a
fresh-weight basis, of imported tablestock potatoes, potato products,
or seed potatoes, as determined by data on imports provided by the U.S.
Department of Agriculture. The casting of such votes shall be
determined by the importer members.
5. In Sec. 1207.513, paragraph (c)(2) is revised to read as
follows:
Sec. 1207.513 Payment of assessments.
* * * * *
(c) * * *
(2) All designated handlers, including a designated handler whose
own production is handled and assessments to the Board paid by another
designated handler, shall report to the Board:
(i) Date of report (which is also date of payment to the Board).
(ii) The name and address of the designated handler;
(iii) The period potatoes were handled;
(iv) The total quantity of potatoes determined to be assessable
during the period potatoes were handled, pursuant to Sec. 1207.511.
* * * * *
Dated: August 26, 1997.
Lon Hatamiya,
Administrator, Agricultural Marketing Service.
[FR Doc. 97-23307 Filed 8-28-97; 12:10 p.m.]
BILLING CODE 3410-02-P
