24714 Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 

DEPARTMENT OF AGRICULTURE 

Food Safety and Inspection Service 

9 CFR Parts 321, 332, and 381 

[Docket No. FSIS–2008–0039] 

RIN 0583–AD37 

Cooperative Inspection Programs: 

Interstate Shipment of Meat and 

Poultry Products 

AGENCY: Food Safety and Inspection 

Service, USDA. 

ACTION: Final rule. 

SUMMARY: The Food Safety and 

Inspection Service (FSIS) is amending 

the Federal meat and poultry products 

inspection regulations to establish a 

new voluntary cooperative program 

under which State-inspected 

establishments with 25 or fewer 

employees will be eligible to ship meat 

and poultry products in interstate 

commerce. In participating States, Stateinspected establishments selected to 

take part in this program will be 

required to comply with all Federal 

standards under the Federal Meat 

Inspection Act (FMIA) and the Poultry 

Products Inspection Act (PPIA). These 

establishments will receive inspection 

services from State inspection personnel 

that have been trained in the 

enforcement of the FMIA and PPIA. 

Meat and poultry products produced 

under the program that have been 

inspected and passed by designated 

State personnel will bear an official 

Federal mark of inspection and will be 

permitted to be distributed in interstate 

commerce. FSIS will provide oversight 

and enforcement of the program. 

DATES: Effective Date: July 1, 2011. 

FOR FURTHER INFORMATION CONTACT: 

Daniel Engeljohn, Assistant 

Administrator, Office of Policy and 

Program Development, Room 350–E, 

Jamie L. Whitten Building, 1400 

Independence Avenue, SW., 

Washington, DC 20250; Telephone (202) 

720–2709, Fax (202) 720–2025. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The Federal Meat Inspection Act 

(FMIA) (21 U.S.C. 601, et seq.) and the 

Poultry Products Inspection Act (PPIA) 

(21 U.S.C. 451, et seq.) (‘‘the Acts’’) 

require that FSIS protect the public by 

ensuring that meat and poultry products 

are safe, wholesome, and accurately 

labeled. The Acts require Federal 

inspection and provide for Federal 

regulation of meat and poultry products 

prepared for distribution in commerce 

for use as human food. 

Cooperative State inspection 

programs. Section 661 of the FMIA and 

454 of the PPIA authorize FSIS to 

cooperate with State agencies in 

developing and administering their own 

meat or poultry products inspection 

programs for the inspection and 

regulation of products that are produced 

and sold solely within the State (21 

U.S.C. 661 & 454). These cooperative 

State inspection programs are required 

to operate in a manner and with 

authorities ‘‘at least equal to,’’ but not 

necessarily identical to, the provisions 

set out in the FMIA and PPIA (21 U.S.C. 

661 (a)(1) & 454 (a)(1)). The ‘‘at least 

equal to’’ standard is a concept that 

requires that State MPI Programs 

operate in a manner that is at least as 

effective as those standards adopted for 

the Federal inspection program. The 

Acts provide for FSIS to contribute up 

to 50 percent of the cost of the 

cooperative State inspection programs, 

as long as the State programs are 

effectively enforcing requirements that 

are ‘‘at least equal to’’ the Federal 

program (21 U.S.C. 661 (a)(3) & 454 

(a)(3)). 

Section 11015 of Title XI of The Food, 

Conservation, and Energy Act of 2008 

(‘‘the 2008 Farm Bill’’), enacted on June 

18, 2008, amended the Acts to establish 

a new cooperative inspection program 

under which certain State-inspected 

establishments will be eligible to ship 

meat and poultry products in interstate 

commerce (Pub. L. 110–246, 112 Stat. 

1651; 21 U.S.C. 683 and 472). The 

amendments to the Acts provide that 

the Secretary of Agriculture (FSIS by 

delegation), ‘‘in coordination with the 

appropriate State agency of the State in 

which the establishment is located,’’ 

may select State-inspected 

establishments with 25 or fewer 

employees to ship meat and poultry 

products in interstate commerce (21 

U.S.C. 683 (b) and 472(b)). Inspection 

services for these establishments must 

be provided by State inspection 

personnel that have ‘‘undergone all 

necessary inspection training and 

certification to assist the Secretary with 

the administration and enforcement of 

[the Acts]’’ (21 U.S.C. 683(a)(2) and 

472(a)(2)). Meat and poultry products 

inspected and passed by the State 

inspection personnel would bear a 

‘‘Federal mark, stamp, tag, or label of 

inspection’’ and would be permitted to 

be shipped in interstate commerce (21 

U.S.C. 683(b)(1) and 472(b)(1)). 

The law provides for the Secretary to 

‘‘designate an employee of the Federal 

government’’ to ‘‘provide oversight and 

enforcement’’ of the program (21 U.S.C. 

683(d)(1) and 472 (d)(1)). If the Federal 

employee finds that an establishment 

selected for the program is in violation 

of the Acts, he or she is required to 

‘‘deselect the selected establishment or 

suspend inspection at the selected 

establishment’’ (21 U.S.C. 683(d)(3)(c) 

and 472(d)(3)(c)). The law requires that 

any selected establishment that FSIS 

‘‘determines to be in violation of any 

requirement of the Act, be transitioned 

to be a Federal establishment’’ (21 U.S.C. 

683(h) and 472(g)). 

The law provides that FSIS is to 

reimburse a State for costs related to the 

inspection of establishments in the State 

selected for the program ‘‘in an amount 

of not less than 60 percent of eligible 

State costs’’ (21 U.S.C. 683(c) and 

472(c)). The law also states that FSIS 

‘‘may provide grants to appropriate State 

agencies to assist the appropriate State 

agencies in helping establishments 

covered by this Act to transition to 

selected establishments’’ (21 U.S.C. 

683(g) and 472(f)). The law is to take 

effect ‘‘on the date on which the 

Secretary, after providing a period of 

public comment (including through the 

conduct of public meetings or hearings), 

promulgates final regulations to carry 

out [section 11015]’’ (21 U.S.C. 683 (j)(1) 

and 472((i)(1)). 

Proposed rule. On September 16, 

2009, FSIS published proposed 

regulations to implement the new 

cooperative interstate shipment program 

(‘‘Cooperative Inspection Programs: 

Interstate Shipment of Meat and Poultry 

Products,’’ 74 FR 47648). 

FSIS held two public meetings by 

teleconference on October 27, 2009, and 

November 4, 2009, to solicit comments 

on the proposed regulations (74 FR 

54493). The comment period for the 

proposed rule was scheduled to close on 

November 16, 2009, but, in response to 

comments, was extended to December 

16, 2009. 

In developing this final rule, FSIS 

considered all comments submitted in 

response to the September 2009 

proposed rule, as well as those provided 

at the two teleconferences held in 

October and November 2009. Based on 

its analysis of the issues, and on 

information provided by the comments, 

FSIS made certain changes to the 

proposed regulations. Those changes are 

summarized below and are discussed in 

detail in the Agency’s responses to 

comments. 

For a more detailed discussion of 

section 11015 of the 2008 Farm Bill and 

FSIS’s proposed implementing 

regulations, refer to the September 16, 

2009, proposed rule. 


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II. Summary of Amendments to the 

Proposed Rule To Implement the 

Cooperative Interstate Shipment 

Program 

In this rulemaking, FSIS is finalizing, 

with some changes, the provisions in 

the September 2009 proposed rule. 

Specifically, the Agency is amending 

the proposal to: 

• Revise the standards for 

determining an establishment’s average 

number of employees for purposes of 

the cooperative interstate shipment 

program to exclude employees whose 

duties do not involve handling the meat 

or poultry products produced by the 

establishment (9 CFR 332.3(b)(1) and (2) 

and 9 CFR 318.513(b)(1) and (2)); 

• Revise the standards for 

determining the average number of 

employees for purposes of the 

cooperative interstate shipment program 

to include uncompensated volunteers 

who are involved in handling the meat 

or poultry products produced by the 

establishment (9 CFR 332.3(b)(6) and 

381.515(b)(6)); 

• Allow States that have existing 

cooperative agreements for a State MPI 

program to submit a request to enter 

into an agreement with FSIS for a 

cooperative interstate shipment program 

before the States have identified 

establishments to recommend for the 

cooperative interstate shipment program 

(9 CFR 332.4(b)(1) and 381.514(b)(1)); 

• Identify factors that will be 

considered to determine the frequency 

with which the FSIS selected 

establishment coordinator (SEC) will 

visit selected establishments under his 

or her jurisdiction (9 CFR 332.7(a) and 

381.517(a)); 

• Give establishments that were 

deselected from the cooperative 

interstate shipment program because 

they are located in a State whose 

agreement for the program was 

terminated the option to either revert 

back to operating under the cooperative 

State MPI program or obtain a Federal 

grant of inspection (9 CFR 332.11(a) and 

381.521(a)); 

• Allow establishments that were 

deselected from the cooperative 

interstate shipment and successfully 

transitioned to become Federal 

establishments to revert back to the 

State MPI program after successfully 

operating as a Federal establishment for 

a year (9 CFR 332.11(b) and 381.521(b)); 

• Allow establishments selected to 

participate in the cooperative interstate 

shipment program to operate under both 

the State MPI program for the State 

where the establishment is located and 

the new cooperative interstate shipment 

program. State-inspected establishments 

that operate under both programs must 

maintain an appropriate separation of 

time or space between operations (9 

CFR 332.13 and 381.523); 

• Allow selected establishments that 

are in full compliance with the 

requirements of the cooperative 

interstate shipment program to 

voluntarily end their participation in 

the program and revert back to the State 

MPI program (9 CFR 332.14 and 

381.514); 

• Codify the definition of ‘‘eligible 

State costs’’ to include those costs that 

a State has justified and FSIS has 

approved as necessary for the State to 

provide inspection services to selected 

establishments in the State (9 CFR 

321.3(b) and 381.187(b)). 

III. Comments and Responses 

FSIS received approximately 90 

separate comment letters in response to 

the September 2009 proposed 

regulations and approximately 5000 

identical comment letters submitted by 

a consumer advocacy organization on 

behalf of private citizens. Comments 

submitted by consumer advocacy 

organizations, private citizens, State 

farm bureaus, trade associations 

representing meat processors, and a 

labor union representing food and 

commercial workers expressed general 

support for the proposed regulations. 

Comments submitted by an association 

of State meat and food inspection 

directors, an association of State 

Departments of Agriculture, several 

State Departments of Agriculture and 

other State agencies, farm and 

agriculture advocacy organizations, 

Congress members providing comments 

on behalf of the State of Wisconsin, and 

private citizens expressed support for 

the concept of a cooperative interstate 

shipment program but objected to 

several provisions in FSIS’s proposed 

implementing regulations. Other 

comments submitted by FSIS inspection 

personnel, small federally-inspected 

establishments, and one consumer 

advocacy organization opposed any 

program that would permit Stateinspected meat and poultry products in 

interstate commerce. 

Following is a discussion of these 

comments and FSIS’s responses. 

A. Development of the proposed rule 

Comment: Several comments 

criticized FSIS for not consulting with 

State officials during the development 

of the proposed regulations. The 

comments stated that several States and 

organizations of State officials had 

offered to form an advisory committee 

to assist FSIS in developing the 

proposed regulations to implement the 

cooperative interstate shipment 

program. As noted by the comments, 

FSIS determined that such a request was 

not practical due to the regulatory 

constraints and the statutory time-line 

for implementing this program. The 

comments encouraged FSIS to work 

closely with State inspection officials to 

develop final regulations to make the 

program as workable as possible. One 

comment said that creating an 

environment where state regulators and 

federal regulators work together 

consistently will provide the stability 

the program needs to be successful for 

all involved. 

Some comments suggested that FSIS 

use this rulemaking as an opportunity to 

encourage more State involvement in 

addressing the nation’s food safety 

problem. The comments encouraged 

FSIS to accord considerable weight to 

comments submitted by States with 

exemplary food safety inspection 

histories and State-inspected 

establishments that likewise have 

exemplary histories when the Agency 

finalizes the proposed rule. 

Response: FSIS appreciates the States’ 

willingness to participate in the 

development and implementation of the 

new cooperative interstate shipment 

program. In developing this final rule, 

FSIS carefully considered the comments 

and suggestions submitted by the States 

and, as a result, the Agency made 

certain revisions to the proposed 

regulations. FSIS will work closely with 

the States as the Agency moves forward 

to implement the cooperative interstate 

shipment program established in this 

final rule. 

Comment: A few comments stated 

that the teleconference format for the 

two public meetings that were held in 

October and November of 2009 was not 

an appropriate way to generate 

comments on the proposed cooperative 

interstate shipment program. One 

comment noted that there were few 

comments presented during the 

teleconferences, which the commenter 

believed may be related to the format of 

the public meeting. One comment said 

that both teleconferences occurred on 

the same dates and times when FSIS 

was offering webinars for small and very 

small plant operators, which presented 

a conflict for those interested in 

participating in both meetings. Another 

comment complained that, although the 

commenter had registered for the 

teleconference and has a confirmation 

passcode to participate, the commenter 

was not allowed to speak during the 

meeting. 

Response: FSIS chose the 

teleconference format for the public 

meetings to provide individuals with 


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easier access to the meeting, particularly 

those who may lack the resources or 

time to attend a meeting in person. FSIS 

will consider the comments submitted 

on this issue to determine how it can 

improve its use of the teleconference 

format to conduct public meetings in 

the future. 

B. General Support for and General 

Opposition to the Proposed Rule 

1. Support for the Proposed Regulations 

Comment: Comments submitted by 

consumer advocacy organizations, 

private citizens, State farm bureaus, 

trade associations representing meat 

processors, and a labor union 

representing food and commercial 

workers expressed general support for 

FSIS’s proposed regulations to 

implement the cooperative interstate 

shipment program. Some of these 

comments said that the language in 

Section 11015 of the 2008 Farm Bill 

reflects an agreement reached through 

negotiations between various national 

consumer organizations, the National 

Association of State Departments of 

Agriculture, the National Farmers 

Union, the American Federation of 

Government Employees, and the United 

Food and Commercial Workers Union. 

According to these comments, the 

language in section 11015 was carefully 

crafted to meet the desire of some Stateinspected meat plants to enlarge their 

area of sales while assuring that all meat 

and poultry sold across state lines meet 

federal inspection standards. The 

comments commended FSIS for writing 

proposed regulations that closely adhere 

to both the intent and specific language 

of the legislation. 

One comment noted that the program 

established in the proposed regulations 

builds on existing State inspection 

programs and includes important 

enhancements that can lead to stronger 

State inspection programs. The 

comment approved of the fact that, like 

the statute, the proposed regulations 

would not permit ‘‘regulatory forum 

shopping.’’ 

Response: FSIS agrees that the 

proposed regulations are consistent with 

both the intent and language of the 

enabling legislation. The Agency also 

agrees that the program established in 

the proposed regulations will 

complement the existing State 

inspection programs. 

2. Support Interstate Shipment but not 

the Program Proposed by FSIS 

Comment: Comments submitted by an 

organization of State Agriculture 

Departments, an organization of State 

meat inspection program Directors, 

several State Departments of 

Agriculture, State agencies, farm and 

agriculture advocacy organizations, and 

private citizens expressed support for 

the concept of a cooperative interstate 

shipment program but had concerns 

about FSIS’s proposed regulations to 

implement the program. Many of these 

comments stated that, instead of 

allowing for the interstate shipment of 

state inspected products, FSIS’s 

proposed regulations essentially set up 

another Federal inspection system 

under more stringent and inflexible 

provisions than the current Federal 

system. According to the comments, 

FSIS’s proposed program fails to remove 

unnecessary barriers for small 

establishments to sell their specialty 

products across State lines. The 

comments asserted that the proposed 

regulations will create a regulatory 

system that is too burdensome for either 

establishments or State inspection 

programs, which likely means that few 

will take advantage of the program. 

To support these assertions, the 

comments noted that, when FSIS issued 

the proposed rule, the Agency estimated 

that approximately 60% (16 of 27) of the 

States with existing State MPI programs 

and approximately 200–600 

establishments were interested in 

participating in the new cooperative 

interstate shipment program. The 

comments stated that after FSIS issued 

the proposed rule, an internal poll 

conducted by an organization of State 

official indicates that only 2 of these 27 

States, each with only a handful of 

establishments, now find the 

cooperative interstate shipment 

proposed by FSIS to be even potentially 

viable. According to the comments, 

without a drastic revision of the 

proposed regulations and active FSIS 

participation in cooperation with the 

State partners, the program is unlikely 

to succeed. 

Response: After careful consideration 

of all comments submitted in response 

to the 2009 proposed rule, FSIS 

modified the proposed regulations to 

provide some added flexibility for 

establishments selected to participate in 

the cooperative interstate shipment 

program. For example, under this final 

rule, selected establishments that are in 

full compliance with the program will 

be permitted to voluntarily end their 

participation in the program. This final 

rule will also permit selected 

establishments to operate under both 

the cooperative interstate shipment 

program and the State’s MPI program if 

they maintain an appropriate separation 

of time or space between operations. 

The Agency believes that these 

modifications, which are discussed in 

more detail in the Agency’s response to 

comments, will provide additional 

incentive for some establishments to 

participate in the program. 

3. Oppose any Program That Would 

Allow Interstate Shipment of StateInspected Product 

Comment: Comments submitted by 

FSIS inspection personnel, small 

federally-inspected meat and poultry 

processing establishments, and a 

consumer advocacy organization 

objected to any program that would 

permit state-inspected meat and poultry 

products to be shipped in interstate 

commerce. According to many of these 

comments, meat and poultry products 

produced in State-inspected 

establishments do not undergo the same 

level of inspection as products 

produced in Federal-inspected facilities, 

and many State MPI programs are not 

truly ‘‘at least equal to’’ the Federal 

inspection program. A few comments 

referenced a 2006 Office of Inspector 

General Audit Report of State-inspected 

meat and poultry programs that the 

comments said found that some Stateinspected facilities had failed to operate 

in a sanitary manner and that FSIS had 

not provided consistent oversight of 

existing State MPI programs. 

Response: As required by law, the 

cooperative interstate shipment program 

established under this final rule will 

operate under the same standards 

imposed under the Federal inspection 

program. Thus, meat and poultry 

products produced in State-inspected 

establishments selected for the 

cooperative interstate shipment program 

will undergo the same level of 

inspection as products produced in 

federally-inspected facilities. 

With respect to the comment that 

many State MPI programs are not truly 

‘‘equal to’’ the Federal inspection 

program, each year the FSIS OPEER 

Federal State Audit Branch reviews the 

State cooperative MPI programs and 

their requirements to verify that each 

State program ‘‘at least equal to’’ the 

Federal program. These comprehensive 

reviews consist of an annual review of 

the State MPI program’s self assessment 

submission and an on-site review to 

verify the State’s self-assessment 

submission. The onsite reviews are 

scheduled at a minimum, once every 

three years. 

Based on the self assessment 

documents received during FY 2009, 

FSIS determined that all of the 27 State 

MPI programs provided adequate 

documentation to support that they 

have implemented and can maintain 

MPI programs ‘‘at least equal to’’ the 

Federal program. FSIS determined that 


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all of the 11 State MPI programs 

reviewed on-site were enforcing 

requirements ‘‘at least equal to’’ those 

imposed under the Federal Acts. 

In its 2006 audit of the FSIS’s 

cooperative State MPI programs, the 

OIG provided recommendations to 

strengthen FSIS’s review of these 

programs. FSIS provided management 

decisions in response to the 2006 OIG 

audit recommendations, which were 

accepted by OIG. The Agency has 

implemented the 2006 management 

decisions. 

Comment: One comment stated that 

State-inspected establishments should 

not be allowed to ship products 

interstate because the States do not have 

the money or staff to provide the 

inspection that the Federal government 

does. Another comment maintained that 

Federal inspectors undergo more 

extensive training than State inspection 

personnel and, therefore, unlike State 

inspectors, are continuously expanding 

their knowledge bases. 

Response: As discussed in greater 

detail below, to qualify for the 

cooperative interstate shipment 

program, States with cooperative State 

MPI programs will need to demonstrate 

that they have staffing sufficient to 

conduct the same inspection activities 

in establishments operating under the 

cooperative interstate shipment program 

that FSIS conducts in official Federal 

establishments. The States will also 

need to demonstrate that the designated 

State personnel have been properly 

trained in Federal inspection 

methodology. FSIS will not enter into 

an agreement for a cooperative interstate 

shipment program with States that are 

unable to meet these conditions. 

Comment: One comment submitted 

by a consumer advocacy organization 

said that while the commenter does not 

support State-inspected meat and 

poultry for either intrastate or interstate 

commerce, it understands that Congress 

amended the FMIA and PPIA to 

establish the cooperative interstate 

shipment program, and that FSIS is 

required to develop regulations to 

implement the law. The comment urged 

the Agency to put into place a system 

whereby establishments that participate 

in the program are held to the identical 

Federal standards and practices as those 

establishments under Federal inspection 

and that the Agency maintain strict 

oversight of such a program. 

Response: The cooperative interstate 

shipment program established in these 

final regulations will be a State 

inspection program under which 

designated State-personnel enforce 

Federal food safety standards. As 

required by law, FSIS will provide 

oversight and enforcement of the 

program. 

Comment: Several comments 

submitted by FSIS inspection personnel 

and small federally-inspected meat and 

poultry processors maintained that 

instead of establishing cooperative 

interstate shipment program, FSIS 

should require that State-inspected 

establishments that desire to ship their 

meat and poultry products in interstate 

commerce come under Federal 

inspection. 

One comment submitted by a small 

federally-inspected establishment 

explained that as a small company, it 

decided to obtain a Federal grant of 

inspection as an investment for the 

future of its business. The comment 

noted that the establishment did this to 

allow for interstate sales of its products 

and that the same option is available 

today for any company willing to make 

a similar investment. The comment 

asserted that to provide for a level 

playing field, all small companies that 

want to sell their products across state 

lines should be required to go through 

the same process and obtain a Federal 

grant of inspection. 

Response: Section 11015 of the 2008 

Farm Bill amended the FMIA and PPIA 

to establish the cooperative interstate 

shipment program. The amendments 

require that FSIS issue final regulations 

to implement the new program. Once 

the new program becomes effective, 

small State-inspected establishments 

that are interested in selling meat or 

poultry products across State lines will 

have the option to operate as a selected 

establishment under the cooperative 

interstate shipment program or as an 

official Federal establishment. An 

establishment that ships products across 

States lines must comply with all 

Federal standards regardless of the 

inspection program that it chooses to 

operate under. 

Comment: One comment said that the 

cooperative interstate shipment program 

is not necessary because the Talmadge/ 

Aiken program serves the same purpose. 

Response: The Talmadge-Aiken 

program and the cooperative interstate 

shipment program serve different 

purposes. Under the Talmadge-Aiken 

program, FSIS enters into a separate 

agreement with a State agency for the 

State program to conduct meat, poultry, 

or egg products inspection or other 

regulatory activities on behalf of FSIS. 

Establishments that participate in the 

Talmadge-Aiken program operate under 

a Federal grant of inspection. Under the 

cooperative interstate shipment 

program, FSIS enters into a separate 

agreement with a State agency to 

enforce Federal food safety standards at 

State-inspected establishments. 

Establishments that participate in the 

cooperative interstate shipment program 

are not Federal establishments operating 

under a Federal grant of inspection. 

Comment: Comments submitted by a 

few FSIS inspection personnel opposed 

the proposed cooperative interstate 

shipment stated because the 

commenters believe that the program 

will result in a reduction in the Federal 

inspection force. The comments stated 

that under such a program, small 

federally-inspected establishments will 

want to drop their Federal grant of 

inspection and produce products under 

State-inspection, thereby taking jobs 

that would otherwise belong to Federal 

employees and giving them to State 

employees. 

Response: Under the law and 

implementing regulations, 

establishments that operate under the 

Federal inspection program are 

ineligible to participate in the 

cooperative interstate shipment 

program. The new program is limited to 

certain small and very small Stateinspected establishments. Thus, the 

cooperative interstate shipment program 

will have little effect on Federal 

inspection personnel. 

Comment: One comment objected to 

allowing the interstate shipment of 

state-inspected products because, 

according to the comment, FSIS will no 

longer have control or jurisdiction over 

some meat and poultry products in 

interstate commerce. The comment 

noted that a State’s jurisdiction is 

limited to the State’s borders. The 

comment asked what would happen if 

product produced by a State-inspected 

establishment is implicated in a food 

safety issue resulting in a recall. 

Response: Under the law, FSIS is 

responsible for providing oversight and 

enforcement of the cooperative 

interstate shipment program. Therefore, 

if an establishment operating under the 

cooperative interstate shipment program 

distributes meat or poultry products that 

present a food safety hazard or that need 

to be recalled for other reasons, FSIS 

will coordinate with the State MPI 

program to ensure that such product is 

removed from commerce. FSIS will be 

responsible for the overall coordination 

of the recall and for verifying that 

recalled product that has been shipped 

interstate has been removed from 

commerce. 

C. Establishment Participation— 

Conditions for Eligibility and Standards 

for Determining Average Number of 

Employees 

The proposed rule prescribed 

conditions that State-inspected 


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establishments would be required to 

meet to become eligible to participate in 

the cooperative interstate shipment 

program. Consistent with the law, 

among these proposed conditions were 

that an establishment be in compliance 

with all Federal inspection 

requirements under the FMIA, PPIA, 

and their implementing regulations, and 

that the establishment employ, on 

average, no more than 25 individuals. 

The proposed rule also included 

proposed standards for determining the 

average number of employees, which, 

for the most part, reflect applicable 

methods used by the Small Business 

Administration (SBA) to calculate the 

number of employees for a small 

business concern. FSIS received several 

comments on the proposed conditions 

for establishment eligibility and the 

proposed standards for determining the 

average number of employees. 

1. Compliance With Federal Standards 

Comment: Some comments agreed 

that State-inspected establishments 

should be required to comply with 

Federal standards to be eligible for the 

cooperative interstate shipment 

program. The comments stated that 

many small and very small 

establishments have managed to 

conform to, and operate successfully 

under, the requirements of the Federal 

inspection system. Two comments 

noted that data obtained from FSIS’s 

PBIS in 2007 show that 51 percent 

(2,878 of 5,603) of all federallyinspected establishments have 10 or 

fewer employees and 80% have 50 or 

fewer employees. 

The comments also noted that all 

establishments that prepare or process 

meat and poultry products have always 

had the opportunity to ship their 

products in interstate commerce 

provided that they apply for and receive 

a Federal grant of inspection. The 

comments stated that small and very 

small establishments now under Federal 

inspection have invested time and 

money to comply with all Federal 

regulations and to operate under Federal 

standards. The comments asserted that 

while the new cooperative interstate 

shipment program is intended to offer 

establishments operating under their 

State inspection program an opportunity 

to broaden their distribution, any 

establishment that ships meat or poultry 

products in interstate commerce can 

and should meet Federal food safety 

standards. 

Other comments stated that requiring 

that State-inspected establishments 

comply with Federal food safety 

standards in order to be eligible for the 

cooperative interstate shipment program 

will establish unfair barriers for small 

plants to participate in the program. The 

comments urged FSIS to provide small 

State-inspected establishments with 

greater flexibility in achieving food 

safety standards. One comment from a 

small State-inspected establishment 

stated that it cannot afford Federal 

inspection. The comment noted that 

establishments operating under the 

State MPI system are required to adhere 

to very strict food safety standards but, 

unlike the Federal system, State 

inspection personnel are also available 

to help the small and very small 

establishments with education and 

training. 

Response: The amendments to the 

Acts in section 11015 of the 2008 Farm 

Bill require that State-inspected 

establishments be in compliance with 

all Federal standards in order to be 

eligible for the cooperative interstate 

shipment program. The provisions in 

the Acts that establish the cooperative 

interstate shipment program define an 

‘‘eligible establishment’’ as an 

establishment that is in compliance 

with both ‘‘* * * the State inspection 

program of the State in which the 

establishment is located’’ and ‘‘[the 

FMIA or PPIA], including the rules and 

regulations issued under [the FMIA or 

PPIA]’’ (21 U.S.C. 472(a)(3) and 

683(a)(3)). 

The Senate Conference Committee 

report on the bill that established the 

cooperative interstate shipment program 

also makes clear that establishments 

selected for the program ‘‘* * * must 

fully follow [the FMIA or PPIA], its 

regulations, notices, directives and 

policies just as would be required of a 

Federal establishment’’ (S. Rep. No. 220, 

110th Cong., 1st Sess. (2007), pp. 211– 

214). Thus, requiring that Stateinspected establishments comply with 

Federal food safety standards to become 

eligible to participate in the cooperative 

interstate shipment program is 

consistent with both the language and 

intent of section 11015 of the 2008 Farm 

Bill. 

FSIS’s Office of Outreach, Employee 

Education, and Training (OOEET) will 

provide technical resources, 

information, and guidance to small and 

very-small State establishments that are 

interested in becoming eligible to 

participate in the cooperative interstate 

shipment program. 

2. Determining Average Number of 

Employees 

a. Proposed standard: All individuals, 

both supervisory and non-supervisory, 

employed by the establishment on a 

full-time, part-time, or temporary basis 

are to be counted when calculating the 

total number of employees. 

Comment: Several comments stated 

that for purposes of the cooperative 

interstate shipment program, an 

establishment’s average number of 

employees should be based only on 

those directly involved in the 

preparation or processing of meat and 

poultry products. The comments noted 

that many small and very small 

establishments conduct operations other 

than the processing of meat or poultry 

products, such as grocery stores, 

convenience stores, or other retail 

outlets. According to the comments, 

employees that do not perform duties 

related to the meat or poultry processing 

operations of the business should not be 

included when calculating the average 

number of employees. 

One comment suggested that FSIS 

consider basing the ‘‘value’’ associated 

with the employee on the workers 

compensation code that the employer 

designates. The commenter said that it 

could give FSIS a simple way of 

determining which workers are 

associated with the meat processing part 

of the business and which employees 

offer other roles for the company, such 

as administrative workers or retail 

clerks. 

Other comments said that all 

establishment personnel, including 

those not involved in the actual 

production of meat and poultry 

products, should be counted when 

calculating the average number of 

employees. One comment noted that the 

law specifically states that supervisory 

and nonsupervisory employees are to be 

counted when calculating the average 

number of employees. The comment 

maintained that this indicates that if 

Congress had intended to exclude 

certain employees from the calculation, 

it would have expressly stated so in the 

law. The comment urged FSIS to require 

that temporary and part-time 

employees, regardless of their position 

in the establishment, be counted when 

determining the average number of 

employees. 

Response: Although the law limits 

participation in the cooperative 

interstate shipment program to Stateinspected establishments that employ, 

on average, 25 or fewer employees, it 

does not distinguish between employees 

involved in an establishment’s meat or 

poultry processing operations from 

those that are not. Counting all 

individuals employed by the 

establishment would ensure that 

participation in the cooperative 

interstate shipment program is limited 

to very small and certain small 

establishments. Counting only 


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1See 13 CFR 121.105 and 121.106 for SBA 

methods to calculate the number of employees of 

a business concern where the size standard in 

number of employees. 

employees directly involved in the 

preparation or processing of meat and 

poultry products would create a more 

flexible standard that would expand the 

number of potentially eligible 

establishments to include those that 

have a small number of employees that 

work in meat or poultry processing but 

a larger number of employees that work 

in other areas of their business. 

The 2008 amendments to the Acts 

give FSIS the authority to define 

‘‘average number of employees’’ for 

purposes of the cooperative interstate 

shipment program, but they also make 

clear that the program is intended for 

State-inspected establishments that 

employ a limited number of individuals. 

Therefore, FSIS is adopting a standard 

for calculating the average number of 

employees that provides some flexibility 

for establishments that conduct 

operations other than meat or poultry 

processing, but that also clearly 

distinguishes those employees that are 

to be counted for purposes of the 

interstate shipment program from those 

that are not. 

Therefore, instead of counting all 

individuals employed by the 

establishment as proposed, under this 

final rule, an establishment’s average 

number of employees will be calculated 

by counting all individuals employed by 

the establishment, excluding the 

employees that do not come into contact 

with the meat or poultry products 

produced by the establishment. For 

example, if the owner of a gas station 

produces beef jerky and sells it at the 

gas station, the employees that are 

involved in producing the jerky, as well 

as those that work as cashiers and sell 

the product, will be counted. The 

mechanics that work on the cars, 

however, will not be. Employees that 

perform solely administrative functions 

and that do not handle meat or poultry 

products will also not be counted. 

When an establishment conducts 

multiple operations, it is sometimes 

difficult to distinguish employees 

associated with the meat or poultry 

operations from those that are not. For 

example, an individual employed as a 

cashier at an establishment’s deli 

operations may also slice and package 

meat or poultry products produced by 

the establishment. The standard 

adopted in this final rule clearly 

distinguishes employees whose duties 

are associated with the meat or poultry 

products produced by an establishment 

from those that are not. It also ensures 

that the cooperative interstate shipment 

program will remain limited to certain 

small and very small establishments, as 

intended. 

b. Proposed standard: Part-time and 

temporary employees are to be counted 

the same as full-time employees. 

Comment: Several comments, most 

submitted by consumer advocacy 

organizations and one submitted by a 

food and commercial workers union, 

agreed with the proposed standard to 

count part-time and temporary workers 

as full-time workers for purposes of 

qualifying for the cooperative interstate 

shipment program. The comments noted 

that most very small establishments 

have few full-time employees, and many 

do not operate every day. The comments 

maintained that counting part-time and 

temporary employees the same as full 

time employees is an effective means to 

assure the cooperative interstate 

shipment program serves the entities it 

was intended to serve. According to the 

comment, failing to count part-time and 

temporary employees in the average 

number of employees would permit 

substantially larger entities to 

participate in a program that was 

designed to serve very small local 

establishments. 

Some of these comments noted that 

during negotiations with the States, 

consumer advocacy groups reluctantly 

agreed to the States’ request for a 

program with a 25 employee limit. 

According to the comment, none of the 

groups involved in the negotiations ever 

agreed to anything larger than 25 

employees. The comments said that the 

primary reason that many consumer 

advocacy organizations had opposed the 

House interstate shipment bill was 

because the bill contained a 50 

employee limit, which, according to the 

comment, would have expanded the 

number of establishments in the new 

cooperative program far beyond what 

was intended. One comment stated that, 

although the program’s 25 employee 

limit is reasonable, the commenter 

would have preferred a limit of 10 

employees, which is similar to the 

current FSIS definition for very small 

establishments. 

Several other comments, most 

submitted by State Departments of 

Agriculture and other State agencies, 

disagreed with the proposed standard to 

count part-time and temporary workers 

as full time employees. The comments 

stated that such a standard seems 

excessive and does not provide an 

accurate depiction of an establishment’s 

actual number of employees. 

The comments noted that many small 

establishments in small towns hire parttime employees who work as little as a 

few hours a week. According to the 

comments, to count such employees as 

full-time would contradict and undercut 

the rural development intentions of the 

enabling legislation. One comment 

stated that in some rural areas, 

especially those with small and very 

small establishments, meat processing 

has a seasonal component that provides 

part-time seasonal work for rural 

residents. The comments noted that 

during each part of the day, an 

establishment may have only 25 

employees on site, even if the total 

number of part-time and fulltime 

employees employed overall during the 

day exceeds 25. 

The comments suggested that parttime and temporary workers be counted 

on the basis of ‘‘full-time equivalents’’ or 

‘‘FTEs,’’ i.e., based on the ratio of their 

work-hours to those of a full-time yearround employee. The comments said 

that part-time and temporary employees 

should be grouped together and counted 

based on the number of hours they work 

each week during the year, with 40 

hours per week being considered an 

FTE. Several comments suggested 

formulas for calculating the number of 

employees based on FTEs. 

Response: After considering the 

comments, FSIS has decided to adopt 

the proposed standard to count 

temporary and part time employees the 

same as full-time employees. For 

purposes of its regulatory programs, 

FSIS defines small and very small 

establishments based on SBA criteria. A 

standard that counts part-time and 

temporary workers the same as full-time 

workers reflects the SBA methods for 

calculating the average number of 

employees for a small business concern 

and is thus consistent with FSIS’s 

overall approach for defining small and 

very small establishments.1

As noted by the comments, several 

very small establishments have few fulltime employees, and many do not 

operate every day. A standard that is 

based on the SBA criteria that counts 

part-time and temporary employees the 

same as full time employees allows 

these establishments to hire seasonal 

workers while ensuring that only very 

small and certain small establishments 

are eligible to participate in the 

program. 

Comment: Several comments stated 

that the standards for determining the 

average number of employees need to 

allow for more flexibility in counting 

temporary seasonal workers. The 

comments noted that small and very 

small establishments often have 

fluctuation in their employees during 

certain parts of the year, such as during 


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holiday and hunting seasons, and that 

the term ‘‘seasonal’’ will have different 

meanings in different areas of the 

country. Some comments noted some 

establishments hire extra employees to 

help with seasonal activities that are not 

related to the processing of amenable 

species, such as processing game meat 

or for busy times in their retail shops 

around holidays. 

The comments suggested that 

seasonal employees be counted based 

on FTE. As an example, the comments 

explained that a seasonal employee who 

works full-time for 3 months would be 

a 25% FTE and should be counted as 

one quarter of an employee. 

One comment asserted that seasonal 

employees should not be counted at all 

when calculating the average number of 

employees. The comment suggested that 

the final rule define a seasonal 

employee as an employee that works for 

the establishment ninety or fewer days 

in a calendar year. 

Response: When Congress amended 

the FMIA and PPIA to establish the 

cooperative interstate shipment 

program, it intended for FSIS to 

interpret the term average ‘‘...to provide 

some flexibility to these selected plants 

that require seasonal employees for 

certain parts of the year, as long as the 

increase in employees are [sic] 

manageable by the establishment and 

the increase in employees does not 

undermine food safety standards’’ (S. 

Rep. No. 220, 110th Cong., 1st Sess., pp. 

211–214 (2007)). 

As discussed below, under the 

proposed rule, selected establishments 

may temporarily employ more than 25 

employees during busy seasons, as long 

as the average number of employees 

continues to be 25 and the number of 

employees does not exceed 35. Thus, a 

standard that counts temporary seasonal 

employees the same as full-time 

employees will allow selected 

establishments to hire seasonal 

employees while ensuring that the 

number of employees remains 

manageable by the establishment, as 

Congress intended. 

FSIS disagrees with the comment that 

stated that seasonal employees should 

not be counted at all. Such an approach 

would be inconsistent with the language 

and intent of the statute. 

c. Proposed standard: The total 

number of employees cannot exceed 35 

at any given time, regardless of the 

average number of employees. 

Comment: Some comments stated that 

the proposed standard that provides that 

the total number of employees can never 

exceed 35 individuals at any given time, 

regardless of the average number of 

employees, is a reasonable upper limit 

for selected establishments to remain 

eligible to participate in the program. 

One comment stated that such a limit is 

reasonable if FSIS does not count parttime and temporary employees the same 

as full time. 

Other comments asserted that FSIS 

should not limit the number of 

employees working at a selected 

establishment at any given time if the 

establishment maintains an average of 

25 employees or fewer. The comments 

stated that while section 11015 of the 

2008 Farm Bill requires that the average 

number of employees not exceed 25, the 

law does not prohibit a selected 

establishment from ever, over the course 

of a year, having more than 35 

employees. 

The comments stated that in many 

small establishments there may be 

‘‘spikes’’ in employee numbers during 

busy periods, but the overall average 

number of employees is under 25. The 

comments asserted that, as written, the 

proposed rule excludes such 

establishments from participating in the 

interstate shipment program. According 

to the comments, section 11015 was not 

intended to exclude these 

establishments. The comments 

suggested that FSIS revise the proposed 

rule to ensure that these establishments 

remain eligible for the program. 

One comment disagreed with the 

proposed 35 employees limit because, 

according to the comment, allowing 

selected establishment to have 35 

employees during seasonal shifts 

represents, at minimum, a 40% increase 

in establishment personnel. The 

comment argued that the higher number 

of employees represents a huge increase 

in production that could overwhelm a 

very small establishment’s production 

systems, which could result in 

contaminated food entering commerce. 

The comment noted that if an 

establishment routinely employs 5 

people and then increases this number 

to 10 or 20 during a certain timeframe, 

it will have a 100% or 400% increase 

in employees. The comment maintained 

that this level of increase is not 

manageable and is not what Congress 

intended. 

The comment suggested that instead 

of limiting the total number of 

employees to 35 at any given time, FSIS 

should cap at 20% the increase in the 

number of employees that an 

establishment may use during a 

seasonal shift. The comment 

acknowledged that the commenter does 

not have data to support this number, 

but stated that it stands to reason that 

a sudden increase in production could 

significantly affect the dynamics within 

an establishment and overwhelm the 

system. According to the comment, 

small and very small establishments 

have HACCP plans for a production 

process at a certain level that would not 

necessarily support a significantly 

higher level of production. The 

comment pointed out that FSIS did not 

provide any data to support the 

proposed 35 employee cap. 

One comment stated that FSIS should 

not allow more than 25 employees in 

selected establishments at any given 

time. The comment noted that section 

11015 requires that establishments that 

consistently employ more than 25 

employees but fewer than 35 employees 

transition to Federal establishments 

within three years of the enactment 

date. The comment stated that this 

provision indicates that Congress 

recognized that establishments that ship 

product in interstate commerce and that 

have more than 25 employees should be 

under Federal inspection. 

Response: While the 2008 

amendments to the Acts do not 

specifically prohibit selected 

establishments from ever having more 

than 35 employees, the Senate report 

described above indicates that Congress 

intended that there be some limits on 

the number of employees working at a 

selected establishment at any given 

time. 

As explained in the preamble to the 

proposed rule, FSIS proposed that the 

number of employees working in a 

selected establishment never exceed 35 

at any given time because the law 

allows FSIS to select for the cooperative 

interstate shipment program 

establishments that employed more than 

25 but fewer than 35 employees as of 

June 18, 2008, the date the law was 

enacted (21 U.S.C. 683(b)(3)(B) and 

472(b)(3)(B)). To remain in the program, 

these establishments must employ fewer 

than 25 employees on average 3 years 

after the effective date of this final rule. 

Thus, while Congress did not intend to 

‘‘* * * routinely allow selected 

establishments to employ above 25 or 

more employees,’’ the fact that the law 

provides for some selected 

establishments to initially employ up to 

35 individuals demonstrates that a 

temporary increase in the number of 

employees of up to 35 individuals, as 

long as the average number of 

employees remains 25 or fewer, is 

consistent with the language and intent 

of the Acts. 

As noted above, when Congress 

established the cooperative interstate 

shipment program, it intended to 

provide some flexibility to 

establishments that require seasonal 

employees to meet consumer demands 

for certain parts of the year. The 20% 


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cap on the increase in the number of 

employees suggested by one of the 

comments would greatly restrict the 

number of temporary workers that a 

selected establishment would be 

allowed to hire during busy seasons. For 

example, an establishment that regularly 

employs five employees on average 

would be permitted to hire only one 

temporary employee during its busy 

seasons. Many small and very small 

establishments operate on an 

intermittent or seasonal basis and are 

accustomed to adjusting their operations 

to temporarily increase production 

without undermining food safety 

standards. FSIS has concluded that 

restricting the increase in employees to 

20% is unlikely to provide the 

flexibility that many very small selected 

establishments will need to meet 

seasonal demands for their products. 

d. Proposed standards: Volunteers 

who receive no compensation are not 

considered employees. 

Comment: One comment disagreed 

with the proposed standard that 

provides that volunteers are not 

considered employees. The comment 

stated as a food safety measure, 

uncompensated volunteers who are 

engaged in meat or poultry product 

processing should be considered 

employees for the purpose of the 

cooperative interstate shipment 

program. 

Response: FSIS agrees with this 

comment and has revised the standards 

for counting employees to include as 

employees, volunteers that perform 

duties that involve handling the meat or 

poultry products produced by the 

establishment. 

D. State Participation: ‘‘The Same as’’ 

Standard for Inspection Services 

Provided to Selected Establishments 

The proposed regulations provide that 

States interested in establishing an 

agreement for a cooperative interstate 

shipment program are required to 

submit a request for such an agreement 

to FSIS through the FSIS district office 

that covers the State. The proposed rule 

also provided that, in their requests, 

States are required to include 

documentation to demonstrate that they 

are able to provide the necessary 

inspection services to selected 

establishments in the State and conduct 

any related activities that would be 

required under a cooperative interstate 

shipment program. The preamble to the 

proposed rule explained that to meet 

this requirement, the statute requires 

that States demonstrate that the 

inspection service that they provide to 

selected establishments in the State will 

be ‘‘the same as,’’ rather than ‘‘at least 

equal to’’ those provided under the 

Federal inspection program. FSIS 

received a significant number of 

comments on the proposed ‘‘same as’’ 

standard. 

1. Support for ‘‘the same as’’ Standard 

Comments submitted by consumer 

advocacy organizations, meat processor 

trade associations whose members 

mainly operate under the Federal 

inspection system, a union representing 

food and commercial workers, two pork 

producer trade associations, and some 

private citizens expressed support for 

the proposed ‘‘same as’’ standard. 

Comment: The comments that 

supported the proposed ‘‘same as’’ 

standard agreed that the language and 

intent of the enabling statute require 

that the cooperative interstate shipment 

program operate under standards that 

are the ‘‘same as’’ the Federal inspection 

system and not the ‘‘at least equal to’’ 

standard that applies to State MPI 

programs. The comments believed that 

all meat and poultry products shipped 

in interstate commerce should be 

required to comply with uniform 

Federal food safety standards rather 

then multiple State standards. The 

comments stated that it is especially 

important for State-inspected 

establishments that participate in the 

new program to be in compliance with 

all Federal standards because the meat 

and poultry products produced by these 

establishments will bear a Federal mark 

of inspection. 

One comment stated that requiring 

that selected establishments that 

voluntarily request the opportunity to 

participate in a cooperative interstate 

shipment program operate in a manner 

that is the ‘‘same as’’ federally-inspected 

establishments is not only consistent 

with the provisions and intent of the 

law, but also ensures that the food safety 

standards established in the FMIA, 

PPIA, and their implementing 

regulations are applied uniformly to all 

meat and poultry products that are 

distributed in interstate commerce. The 

comment encouraged FSIS to retain the 

proposed ‘‘same as’’ standard to first and 

foremost ensure the safety of meat and 

poultry products distributed in 

interstate commerce, but also to ensure 

equity in the marketplace. The comment 

added that this fundamental 

proposition, that the playing field be 

level for all companies engaging in 

interstate commerce, was a critical 

element in securing passage of the 

statutory provisions that authorized the 

cooperative interstate shipment 

program. The comment asserted that the 

program must not provide an unfair 

advantage to small companies that will 

not, or cannot, make the commitments 

necessary to comply with Federal food 

safety requirements. 

Two comments stated that requiring 

that State-inspected products produced 

under the cooperative interstate 

shipment program comply with all 

Federal requirements is essential for 

maintaining domestic and international 

markets for U.S. meat and poultry 

products. Other comments said that 

consumers expect that products carrying 

the Federal mark of inspection comply 

with Federal standards for meat and 

poultry inspection. The comments 

stated that establishments that are not 

held to all aspects of the Federal 

requirements should not be entitled to 

apply the Federal mark of inspection on 

their products. 

One comment that supported the 

‘‘same as’’ standard noted that although 

establishments operating under a State 

MPI inspection program receive 

inspection services that are ‘‘at least 

equal to’’ the Federal inspection 

program, the methodology employed by 

FSIS is a critical part of the effectiveness 

of the Federal food safety system. The 

comment asserted that, as such, it is 

essential for States that participate in 

the cooperative interstate shipment 

program to follow Federal inspection 

methodology when providing 

inspection services to selected 

establishments. 

Response: FSIS agrees that the ‘‘same 

as’’ standard is consistent with the 

language and intent of the statutes. The 

issues raised by the comments 

demonstrate why it is important for the 

cooperative interstate shipment program 

to operate under standards that are ‘‘the 

same as’’ those imposed under the 

Federal meat and poultry products 

inspection programs. 

2. Opposed to ‘‘same as’’ standard 

Several comments submitted by State 

Departments of Agriculture and other 

State agencies, as well as organizations 

representing these entities, objected to 

the proposed ‘‘same as’’ standard. Some 

farm and rural community advocacy 

organizations, cattle producer 

organizations, a trade association 

representing small meat processors, and 

an animal welfare advocacy 

organization also opposed the proposed 

standard. 

Comment: Several comments that 

objected to the proposed ‘‘same as’’ 

standard claimed that such a standard is 

not authorized by law. These comments 

asserted that the Acts, as amended by 

the 2008 Farm Bill, do not contain any 

language that would require that the 

inspection services that States provide 

to selected establishments be ‘‘the same 


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as’’ or ‘‘identical to’’ the inspection 

services provided under the Federal 

program. The comments maintained 

that such an interpretation is an 

extrapolation of the language that does 

not exist in the statute. 

The comments noted that under the 

2008 Farm Bill amendments, the term 

‘‘eligible establishment’’ refers to an 

establishment that is ‘‘in compliance 

with’’ the Acts. The comments also 

noted that these amendments authorize 

the SEC to ‘‘ensure that selected 

establishments are operating in a 

manner that is consistent with * * *’’ 

the Acts (21 U.S.C. 472(d)(3)(A), 

683(d)(3)(A)). The comments argued 

that these provisions indicate that if 

Congress had intended to require that 

the State program be ‘‘the same as’’ or 

‘‘identical to’’ to the Federal program, it 

would have specifically said so in the 

statute. 

The comments also noted that the 

2008 Farm Bill did not amend the 

provisions in the FMIA and PPIA that 

provide for cooperative State MPI 

programs that are ‘‘at least equal’’ to the 

Federal program. According to the 

comments, the fact that Congress did 

not amend these provisions 

demonstrates that State programs that 

are ‘‘at least equal to’’ the Federal 

program are in compliance with the 

Acts. 

Response: The language in the FMIA 

and PPIA, as amended by the 2008 Farm 

Bill, is clear: Congress provided that the 

cooperative interstate shipment program 

would operate under standards that are 

‘‘the same as’’ those imposed under the 

Federal program. 

The 2008 amendments to the FMIA 

and PPIA provide that to be eligible for 

the cooperative interstate shipment, 

State-inspected establishments must be 

in compliance with both the State’s MPI 

program and ‘‘* * * the requirements of 

this chapter, including the rules and 

regulations issued under this chapter’’ 

(21 U.S.C. 472(a)(3) and 683(a)(3)). As 

used in the statutes, the term ‘‘this 

chapter’’ refers to the FMIA at 21 U.S.C 

Chapter 12, and the PPIA at 21 U.S.C. 

Chapter 10. The 2008 amendments also 

require that the State personnel 

designated to provide inspection 

services under the program undergo 

‘‘* * * all necessary training and 

certification to assist * * * in the 

administration and enforcement of this 

chapter, including the rules and 

regulations issued under this chapter’’ 

(21 U.S.C. 472(a)(2) and 683(a)(2)). The 

2008 amendments allow a meat or 

poultry product inspected by designated 

State personnel to bear a Federal mark 

of inspection and be shipped in 

interstate commerce if the product 

‘‘* * * qualifies for the mark * * * 

under the requirements of this chapter’’ 

(21 U.S.C. 472(b)(1)(A) and 

683(b)(1)(A)). 

The Senate Conference Committee 

report on the bill that established the 

cooperative interstate shipment program 

provides that ‘‘* * * establishments 

selected for the [cooperative interstate 

shipment] program * * * must fully 

follow [the FMIA or PPIA], its 

regulations, notices, directives and 

policies just as would be required of a 

Federal establishment’’ (S. Rep. No. 220, 

110th Cong., 1st Sess. (2007), pp. 211– 

214). The report also provides that 

‘‘* * * [t]he inspection personnel of the 

State that will inspect the selected 

establishment must have undergone all 

the necessary training to carry out the 

requirement of [the Acts], [their] 

regulations, notices directives and 

policies, just as required of a Federal 

inspector.’’ 

Thus, both the statute and the 

Committee report make clear that 

Congress intended for the cooperative 

interstate shipment program to operate 

under standards that are ‘‘the same as’’ 

those imposed under the Federal 

inspection program. 

FSIS agrees with the comments that 

stated that the 2008 Farm Bill did not 

amend the provisions in the FMIA and 

PPIA that provide for cooperative State 

MPI programs that are ‘‘at least equal’’ to 

the Federal program. However, FSIS 

disagrees that this means that State 

programs that are ‘‘at least equal to’’ the 

Federal program are in compliance with 

all requirements of the Acts for 

purposes of the cooperative interstate 

shipment program. Under the FMIA and 

PPIA, establishments operating under 

an ‘‘at least equal to’’ State MPI program 

are permitted to produce meat or 

poultry products solely for distribution 

within the State where the 

establishment is located (21 U.S.C. 

454(a)(1) and 661(a)(1)). Thus, State 

programs that are ‘‘at least equal to’’ the 

Federal program are in compliance with 

the Acts only if the establishments 

operating under these programs prepare 

and ship products solely for use within 

the State where they are located. 

Comment: One comment asked 

whether the proposed rule requires that 

a State’s entire MPI program must be 

‘‘identical to’’ the Federal program for 

the State to qualify for the cooperative 

interstate shipment program. 

Response: No, a State’s entire MPI 

program does not need to be identical to 

the Federal program for the State to 

qualify for the cooperative interstate 

shipment program. To qualify for the 

program, a State must demonstrate that 

the inspection services that it will 

provide to selected establishments in 

the State will be ‘‘the same as’’ those 

provided under the Federal inspection 

program. States that participate in the 

cooperative interstate shipment program 

may continue to operate an ‘‘at least 

equal to’’ State MPI program for 

establishments that produce meat and 

poultry products solely for distribution 

within the State. 

Comment: Several comments stated 

that the interstate shipment program’s 

legislative history demonstrates that 

Congress intended for the program to 

operate under the ‘‘at least equal’’ 

standard required for the existing 

cooperative State MPI programs. 

According to the comments, the 

conference reports for the House and 

Senate versions of interstate shipment 

legislation indicate that Congress 

adopted the Senate version of the bill 

because the House version would have 

required that States implement meat 

and poultry inspection programs 

‘‘identical to’’ the Federal inspection 

system. The comments maintained that 

the legislative intent was to provide 

current State facilities with a viable 

route to ship State product interstate. 

The comments said that the requirement 

for State plants to be ‘‘identical to’’ or 

‘‘same as’’ a federal plant radically 

deviates from this. 

Response: The comments are correct 

in that Congress did adopt the Senate 

version of the legislation that 

established the cooperative interstate 

shipment program. However, FSIS 

disagrees that the Senate version was 

adopted to permit State-inspected 

establishments operating under an ‘‘at 

least equal to’’ standard to ship meat and 

poultry products in interstate 

commerce. 

Section 11103 of the House version of 

the 2008 Farm Bill would have 

amended the FMIA and PPIA to replace 

the existing ‘‘at least equal to’’ 

cooperative State MPI program with a 

new program that would have 

authorized FSIS to approve, and enter 

into cooperative agreement with, only 

those State MPI programs that adopt 

standards identical to those imposed 

under the Federal program (H. Rep. 

110–256, 110th Cong., 1st Session, pp. 

184–191). Under the House version, all 

State-inspected establishments would 

have been required to comply with 

Federal standards, the State mark of 

inspection would have been deemed an 

official mark, and all State-inspected 

establishments would have been 

allowed to ship meat or poultry 

products in interstate commerce. 

The Senate bill, which was the 

version adopted in the 2008 Farm Bill, 

supplements, but does not replace, the 


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existing State MPI programs. The Senate 

version provides an option under which 

State-inspected establishments that 

have, on average, 25 or fewer 

employees, will be permitted to ship 

their meat or poultry products in 

interstate commerce. Under the Senate 

version, State-inspected establishments 

are required to comply with all Federal 

standards to be eligible to participate in 

the cooperative interstate shipment 

program, and designated State 

personnel must be trained to enforce 

Federal food safety standards. Under the 

Senate version, State-inspected 

establishments that choose not to 

participate in the cooperative interstate 

shipment program may continue to 

operate under the ‘‘at least equal to’’ 

State MPI program and ship their 

products within the States where they 

are located. 

Comment: Some comments claimed 

that in the past, FSIS itself concluded 

that it was unrealistic for States to 

maintain MPI programs that are ‘‘the 

same as’’ or ‘‘identical to’’ FSIS’s 

program. The comments noted that in 

2003, the Agency provided an option for 

the States to claim that their meat and 

poultry inspection programs were ‘‘same 

as’’ or ‘‘identical to’’ FSIS inspection as 

part of the Agency’s annual review in 

which it verifies that State MPI 

programs are ‘‘equal to’’ the Federal 

program. The comments said that in 

2006, FSIS reached the conclusion that 

it was logistically impossible for State 

programs to maintain a true ‘‘same as’’ or 

‘‘identical to’’ status, so the Agency 

removed this option from the State Self 

Assessment Manual forms. The 

comments asserted that if only a few 

years ago FSIS acknowledged that it is 

impossible for State MPI programs to be 

the ‘‘same as’’ Federal programs, 

proposing such a standard now will 

effectively prevent States from 

qualifying for a cooperative interstate 

shipment program. 

Response: FSIS has stated that ‘‘at 

least equal to’’ does not require that 

States operate their cooperative MPI 

programs in a manner that is ‘‘the same 

as’’ or ‘‘identical to’’ the FSIS program or 

does not prohibit States from 

establishing safeguards that the States 

believe to be more effective than those 

employed by FSIS. The law does not 

require that the cooperative State MPI 

programs operate under standards 

‘‘identical to’’ the Federal program. 

As noted above, the cooperative 

interstate shipment program will 

supplement the existing State MPI 

programs, not replace them. Thus, while 

States that participate in the cooperative 

interstate shipment program will need 

to provide the same inspection services 

to selected establishments that FSIS 

provides to federally-inspected 

establishments, States may also 

continue to operate their cooperative 

State MPI programs in a manner that is 

‘‘at least equal to’’ the Federal program. 

Comment: Several comments noted 

that a foreign country must demonstrate 

that its inspection system is 

‘‘equivalent’’ to the U.S. inspection 

system before FSIS will permit 

establishments located in the foreign 

country to import meat and poultry 

products into the United States. These 

comments asserted that requiring that 

States operate their cooperative 

interstate shipment programs under 

standards that are the ‘‘same as’’ those 

required under the Federal program 

subjects the States to a stricter and less 

flexible standard than the standard 

applied to foreign countries. One 

comment maintained that while the 

commenter does not support the 

equivalent standard for foreign facilities, 

there is no justification for 

discriminating against domestic 

establishments under the jurisdiction of 

State inspection programs by requiring 

that they meet more rigid standards than 

those imposed on foreign 

establishments. 

Response: The equivalence standard 

applied to imported meat and poultry 

products and the ‘‘same as’’ standard 

applied to meat and poultry products 

produced under the cooperative 

interstate shipment program reflect the 

relevant provision in the FMIA and 

PPIA. The FMIA and PPIA require that 

FSIS treat as equivalent to a U.S. 

requirement alternative measures 

proposed by an exporting country if the 

country provides scientific evidence or 

other information, in accordance with 

risk assessment methodologies agreed to 

by FSIS and the exporting country, to 

demonstrate that the alternative 

measure achieves the level of protection 

that is appropriate for the United States 

(21 U.S.C. 620(e)(1)(B), 466(d)(2)(A)). 

These provisions reflect the U.S. 

Government’s obligation under the 

World Trade Organization (WTO) 

Agreement on the Application of 

Sanitary and Phytosanitary Measures 

(the SPS Agreement) to accept the 

sanitary measures of an exporting 

Member country as equivalent if the 

exporting member demonstrates that its 

sanitary measures attain the same level 

of protection (Article 4.1, ‘‘Agreement 

on the Application of Sanitary and 

Phytosanitary Measures). FSIS evaluates 

foreign food regulatory systems for 

equivalence through document reviews, 

on-site audits, and port-of-entry 

reinspection of products at the time of 

importation (9 CFR part 327 and 381 

subpart T). 

Comment: Several comments asserted 

that it is unnecessary to require that the 

inspection services that States provide 

to selected establishments be the ‘‘same 

as’’ inspection services provided under 

the Federal program because most States 

have incorporated the Federal 

requirements into their State MPI 

programs. The comments stated that, 

according to FSIS’s 2008 report on its 

review of the State MPI programs, these 

State programs have demonstrated that 

they can implement the Federal laws 

and regulations in a manner that is ‘‘at 

least equal to,’’ and thus, ‘‘in compliance 

with’’ the Federal standards without 

operating under a program that is ‘‘the 

same as’’ the Federal inspection program 

because of the smaller staff size and 

other administrative aspects of the State 

programs. 

Response: As noted throughout this 

document, the 2008 amendments to the 

Acts require that the inspection services 

that States provide to selected 

establishments be ‘‘the same as’’ those 

provided under the Federal inspection 

program. The Senate report also makes 

clear that State inspection personnel are 

‘‘* * * to carry out the Federal 

requirements of the [the Acts], [their] 

regulations, notices directives and 

policies, just as required of a Federal 

inspector’’ (S. Rep. No. 110–220, 110th 

Cong., 1st Sess. (2007), pp 211–214). 

Thus, FSIS disagrees that State 

programs that have implemented the 

Federal laws and regulations in a 

manner that is ‘‘at least equal to’’ the 

Federal inspection program are ‘‘in 

compliance with’’ the Federal standard 

for purposes of the cooperative 

interstate shipment program. The law 

clearly requires that the inspection 

services that designated State personnel 

provide to selected establishments in 

States participating in the cooperative 

interstate shipment program be ‘‘the 

same as’’ those provided under the 

Federal program. 

Comment: Several comments claimed 

that under the ‘‘at least equal to’’ 

standard, some States have 

implemented requirements for food 

safety and consumer protection that are 

stricter than those provided for under 

the Federal Acts. According to these 

comments, many States have processes 

for the review and evaluation of product 

labels that do more than FSIS’s generic 

label process to ensure that the labels of 

meat and poultry products properly 

inform consumers about the product, its 

weight and its ingredients. The 

comments also noted that while FSIS 

currently does not have the authority to 

levy civil penalties for violations of the 


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Federal Acts, many States have the 

authority to impose civil penalties 

against violators of State meat and 

poultry inspection laws. Some 

comments stated that while FSIS allows 

the slaughter and sale of up to 20,000 

farm raised chickens annually to 

restaurants and retail markets without 

benefit of inspection, many State 

programs do not permit this activity. 

The comment claimed that requiring 

States to operate their MPI programs in 

a manner that is ‘‘identical to’’ the 

Federal program could force the States 

to lower their standards. 

One comment stated that some states 

impose humane handling and slaughter 

requirements that go above and beyond 

those required by Federal law. Another 

comment said that some States have 

stricter cold storage requirements than 

FSIS. 

Response: As discussed above, the 

cooperative interstate shipment program 

established in this final rule 

supplements rather than replaces the 

existing State MPI programs. States that 

participate in the cooperative interstate 

shipment program may continue to 

operate their ‘‘at least equal to’’ State 

MPI programs for meat and poultry 

products produced and sold solely 

within the State. Thus, this final rule 

does not affect requirements for 

labeling, civil fines, poultry inspection, 

humane handling, or cold storage that 

States have adopted as part of their 

cooperative State MPI programs. 

Comment: In the preamble to the 

proposed rule, FSIS explained that to 

qualify for a cooperative interstate 

shipment program, States will need to 

demonstrate that they have the authority 

under State law to provide the necessary 

inspection services to selected 

establishments in the State (74 FR 

47652). Some comments noted that if 

the final regulations require that 

inspection services provided to selected 

establishments be the ‘‘the same as’’ 

those provided under the Federal 

inspection system, many States will not 

be able to immediately change their 

laws to make them identical to the 

Federal inspection laws. 

One comment noted that the ability of 

States interested in the new program to 

change their rules and adopt FSIS 

regulations will depend on the process 

the State program must follow in order 

to make those changes. Other comments 

noted that each State has its own 

legislative process and some State 

legislatures do not meet every year. One 

comment noted that, although the State 

programs are ‘‘equal to’’ the Federal 

inspection system, the terminology and 

precise phrasing in the laws and 

regulations differ, and that State 

administrative systems vary. 

Response: As discussed above, the 

cooperative interstate shipment program 

supplements the existing State MPI 

programs. Therefore, States are not 

required to amend all State inspection 

laws to make them identical to the 

Federal requirements. States interested 

in participating in the cooperative 

interstate shipment program will need 

to demonstrate that they have the 

necessary legal authority to enforce 

Federal food safety standards in selected 

establishments in the State. 

As noted by the comments, State laws 

and regulations differ, and each State 

has its own legislative process. Some 

States may already have the necessary 

legal authority to participate in the 

cooperative interstate shipment 

program, while others may need to 

make legislative changes to provide for 

any additional authority that they may 

need. 

Comment: Some comments asserted 

that the main focus of any program that 

provides for the interstate shipment of 

State-inspected products should be on 

the safety of the products produced in 

the selected establishments, not on 

administrative procedures for the 

inspection program. According to the 

comments, if States are required to 

operate their cooperative interstate 

shipment programs in a manner that is 

the ‘‘same as’’ the Federal program, the 

focus of these programs will be on the 

administrative procedures of the State 

instead of food safety. The comments 

stated that regulatory requirements can 

be met through different means and that 

it is not practical or effective for a State 

program to operate under the exact same 

procedures prescribed in the Federal 

system. 

The comments suggested that an 

effective alternative would be to allow 

States to work within the existing ‘‘equal 

to’’ framework to develop food safety 

activities focused on problems specific 

to their establishments. The comments 

stated that the ‘‘at least equal to’’ 

standard is well accepted and has been 

effective in ensuring that State MPI 

inspection programs are comparable to 

the Federal program. 

Response: As explained above, the 

law does not provide for the cooperative 

interstate shipment program to operate 

within the existing ‘‘at least equal to’’ 

framework. Under the 2008 

amendments to the Acts, meat or 

poultry produced in selected 

establishments are permitted to bear a 

Federal mark of inspection and be 

shipped in interstate commerce only if 

designated State personnel find that 

such product qualify for a Federal mark 

(21 U.S.C. 683(b)(1)(a) and 472(b)(1)(a)). 

While products that are inspected and 

passed under a State’s ‘‘at least equal’’ 

MPI program qualify for a State mark, 

these products are not eligible for a 

Federal mark. 

Comment: Some comments 

complained that FSIS’s proposed 

regulations would require that States 

maintain two separate inspection 

systems, one that is ‘‘identical to’’ the 

Federal program and one that is ‘‘equal 

to’’ the Federal program. The comments 

said that adding an entirely new State 

inspection system to comply with the 

‘‘same as’’ standard will add an extra 

layer of cost for the States. According to 

the comments, many States would need 

to hire additional laboratory staff to 

perform different methodology and 

complete documentation the same as 

FSIS. The comments also said that 

States would need funds to train 

inspectors and purchase Federal 

computers, and that overall State 

administrative costs would increase 

because office staff, accountants, 

supervisors, and managers would need 

to manage two systems. One comment 

urged FSIS to fully consider the impact 

that the ‘‘same as’’ standard will have on 

the administrative aspects of the State 

inspection programs. 

Response: In the Preliminary 

Regulatory Impact Analysis (PRIA) to 

the proposed interstate shipment rule, 

FSIS acknowledged that States that 

choose to participate in the cooperative 

interstate shipment program may need 

to make certain modifications to their 

inspection program to provide 

inspection services to selected 

establishments in the State (74 FR 

47657). The Agency also acknowledged 

that the inspection costs under the new 

program may differ from the costs of the 

existing State MPI program. As required 

by law, if Congress provides the 

necessary funding for the cooperative 

interstate shipment program, FSIS will 

reimburse States for costs related to the 

inspection of selected establishments in 

the State in an amount not less than 60 

percent of eligible State cost. FSIS has 

updated its analysis of the State costs in 

the Final Regulatory Impact Analysis 

(FRIA) for this final rule. 

As noted by the comments, the 

cooperative interstate shipment program 

established in the proposed rule may 

require that States maintain two 

separate inspection programs, one that 

is ‘‘the same as’’ the Federal program and 

one that is ‘‘equal to’’ the Federal 

program. States that enter into 

cooperative agreements under the 

Talmadge-Aiken program to provide 

Federal inspection services to Federal 

establishments on behalf of FSIS are 


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also required to maintain two separate 

inspection systems—one under the 

cooperative State ‘‘at least equal to’’ MPI 

program and the other under the 

cooperative Talmadge-Aiken program. 

Thus, FSIS does not believe that the cost 

to administer two separate cooperative 

inspection programs will prevent States 

that are interested in participating in the 

cooperative interstate shipment program 

from doing so. 

3. ‘‘Same as’’ Computer Systems and 

Forms 

In the preamble to the proposed rule, 

FSIS explained that to qualify for a 

cooperative interstate shipment 

program, the Agency expects States to 

demonstrate that they can provide the 

necessary equipment for State personnel 

to provide the same inspection services 

to selected establishment that FSIS 

provides to official establishments, 

including computers and supplies for 

collecting regulatory product samples 

(74 FR 47652). 

Comment: A number of comments 

said that this statement could be 

interpreted to mean that State programs 

must obtain and use the same 

computers and computer programs that 

are used by FSIS personnel. The 

comments requested that FSIS clarify its 

expectations with regard to the type of 

computers and information systems the 

States will need to have in place to 

qualify for a cooperative interstate 

shipment program. 

Some of these comments noted that 

many States currently use State-issued 

laptops computers and have developed 

systems that have been determined 

‘‘equal to’’ FSIS to track and report 

inspection activities and other required 

data. One comment noted that some 

States have developed their own datadriven systems that mimic the Federal 

System, but that also allow State 

program personnel access to State 

licensing information and to view and 

conduct other inspection activities in 

facilities that are not related to meat and 

poultry. According to the comment, 

States with their own information 

systems are able to tailor FSIS 

inspection activities, which are geared 

towards use in larger establishments, to 

be effective in very small 

establishments. 

Response: To qualify for the 

cooperative interstate shipment 

program, States will need to have 

computer programs and information 

systems that are ‘‘the same as’’ those 

used by FSIS to administer the Federal 

inspection program. Assuming that 

Congress provides the necessary 

funding, FSIS will allow States that do 

not have the necessary information 

systems to purchase from the Agency 

federally-procured computers and the 

necessary computer programs. FSIS will 

reimburse the States for 60% of their 

eligible costs to obtain the necessary 

computers and software. FSIS does not 

intend to reimburse more than 60% of 

the States’ costs unless Congress directs 

it, and provides the money for it to do 

so. 

Comment: Some comments stated that 

if FSIS expects States to have 

information systems that are identical to 

those used under the Federal system, 

some States will need to maintain two 

computer systems to participate in the 

program because the Federal computer 

system does not allow any State 

program loads, and the Federal systems 

cannot be operated on a computer other 

than a federally-sourced computer. One 

comment noted that federally-procured 

computers generally cost more than 

State-procured ones, and the Federal 

computers would only be used on a 

limited basis by State personnel that 

work in selected establishments. 

Response: As noted above, to provide 

the necessary inspection services under 

the cooperative interstate shipment 

program, States that participate in the 

program will need to use computer 

programs that are ‘‘the same as’’ those 

used by FSIS to administer the Federal 

inspection program. Thus, if the Federal 

computer programs cannot be operated 

on State-sourced computers, the State 

may need to purchase new computers 

from FSIS. As a result, some States will 

need to maintain two computer systems 

to participate in the cooperative 

interstate shipment program. 

Comment: One comment asked if 

states participating in the cooperative 

interstate shipment program will have 

access to all of the Federal data 

programs, like eADRS, Assurance Net 

and FSIS intranet. Another comment 

stated that FSIS did not explain how 

requiring that States have identical 

computer systems in order to participate 

in the cooperative interstate shipment 

program will further food safety and 

compliance with the Acts. 

Response: States that participate in 

the cooperative interstate shipment 

program will have access to the 

computer programs that are necessary to 

provide inspection services that are ‘‘the 

same as’’ those provided under the 

Federal program. The computer systems 

used by States to administer the 

cooperative interstate shipment program 

need to be ‘‘the same as’’ those used 

under the Federal program to ensure 

that selected establishments are meeting 

all food safety standards that are ‘‘the 

same as’’ rather than ‘‘at least equal to’’ 

standards imposed under the Federal 

program. 

Comment: Some comments asked 

whether the forms used by States 

operating under a cooperative interstate 

shipment need to be identical to the 

Federal forms that FSIS uses under its 

inspection program. According to one 

comment, State inspection programs 

frequently do not have access to Federal 

forms and, therefore, most have 

developed their own forms. The 

comment stated that, if States are 

required to maintain forms that are 

identical to the Federal forms, many 

States will need to manage two different 

sets of documentation to participate in 

the cooperative interstate shipment 

program. 

Response: To provide the necessary 

inspection services to selected 

establishments participating in the 

cooperative interstate shipment 

program, States will need to use forms 

that are the same as those used under 

the Federal inspection program. FSIS’s 

OOEET will assist the States to obtain 

the necessary forms. 

4. ‘‘Same as’’ Training for Designated 

State Personnel 

The preamble to the proposed rule 

stated that to qualify for a cooperative 

interstate shipment program, States will 

need to demonstrate that designated 

State personnel have been properly 

trained in Federal inspection 

methodology (74 FR 7652). The 

preamble also explained that FSIS offers 

training courses in Federal inspection 

methodology to State inspection 

personnel and that States that are 

interested in participating in a 

cooperative interstate shipment program 

will be responsible for making 

arrangements for their inspection 

personnel to attend these courses. 

Comment: Several comments stated 

that FSIS-sponsored training is costly, 

lengthy, and almost always requires 

travel out of State for extended periods 

of time. The comments suggested that, 

instead of requiring designated State 

personnel to attend FSIS training, the 

Agency should allow States to provide 

training that is ‘‘equal to’’ FSIS’s training 

program. The comments explained that 

such training would include equivalent 

content as FSIS training but could be 

administered by the individual States, 

other State programs, FSIS or other 

qualified entities. 

Response: The law does not provide 

for training that is ‘‘equal to’’ FSIS’s 

training program or that includes 

equivalent content. The 2008 

amendments to the Acts require that 

designated State personnel under go 

‘‘* * * all necessary inspection training 


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and certification to assist the [FSIS 

Administrator] in the administration 

and enforcement of [the Acts], including 

rules and regulations issued under [the 

Acts]’’ (21 U.S.C. 683(a)(2)and 472(a)(2)). 

As stated in the Senate Committee 

report, this means that the designated 

State personnel ‘‘* * * must have 

undergone all the necessary training to 

carry out the requirements of [the Acts], 

[their] regulations, notices, directives 

and policies, just as required of a 

Federal inspector’’ (S. Rep. No. 220, 

110th Cong., 1st Sess. (2007), pp. 211– 

214) Thus, the law clearly requires that 

the training in Federal inspection 

methodology provided to designated 

State personnel be ‘‘the same as’’ the 

training provided to FSIS inspection 

personnel. 

As noted in the preamble to the 

proposed cooperative interstate 

shipment rule, FSIS offers training 

courses in Federal inspection 

methodology to State inspection 

personnel. FSIS’s OOEET will 

coordinate with States participating in 

the cooperative interstate shipment 

program to provide the necessary 

training for designated State personnel. 

Comment: Some comments stated that 

many States conduct their own training 

courses, which are subject to oversight 

by FSIS. The commenters noted that 

these State courses often present the 

identical material that FSIS presents in 

its training courses. The comments 

suggested that FSIS consider these State 

courses as acceptable training for 

designated State personnel. 

Response: Although some States may 

be providing training that includes the 

same content as the training provided 

by FSIS, designated State personnel will 

need to complete FSIS-sponsored 

training for the State to qualify for the 

cooperative interstate shipment 

program. FSIS-sponsored training 

courses will ensure that designated 

State personnel receive the necessary 

training to carryout the requirements of 

the Federal Acts, ‘‘just as required of a 

Federal inspector,’’ as intended by 

Congress. 

Comment: One comment asked 

whether State personnel will need to 

complete their training before the State 

begins its cooperative interstate 

shipment program. Some comments 

stated that State programs cannot afford 

the travel costs associated with sending 

already trained state inspectors to 

additional training. One comment 

suggested that FSIS make any required 

training for State inspectors available 

through on-line courses at no charge to 

the States. Two comments asked 

whether FSIS would be covering 

training and training-related expenses. 

Response: As noted above, the 

preamble to the proposed rule explained 

that to qualify for the program, States 

would need to demonstrate, among 

other things, that designated State 

personnel have been properly trained in 

Federal inspection methodology. This 

means that when a State submits a 

request to FSIS for a cooperative 

interstate shipment program, the State 

must demonstrate either that its 

designated State personnel have 

completed the necessary training in 

Federal inspection methodology or that 

such personnel will have completed 

such training before they begin to 

provide inspection services to selected 

establishments in the State. 

As previously noted, FSIS currently 

offers courses in Federal inspection 

methodology to State inspection 

personnel. States that are interested in 

participating in a cooperative interstate 

shipment program will be responsible 

for making arrangements for their 

inspection personnel to attend these 

courses. FSIS’s OOEET will coordinate 

with the States to help make the 

necessary training available to 

designated personnel in the State. For 

example, if a State has a significant 

number of designated personnel that 

need to be trained Federal inspection 

methodology, FSIS could arrange to 

conduct training courses at a location 

within the State so that all designated 

State personnel can attend. 

As it does for training costs associated 

with the State MPI program, FSIS will 

reimburse States for any eligible training 

costs associated with the cooperative 

interstate shipment program, including 

necessary travel costs. However, instead 

of reimbursing the State for 50% of the 

eligible costs, FSIS will reimburse 60% 

of a State’s eligible costs associated with 

training designated State personnel. 

As discussed above, for a State to 

qualify for the cooperative interstate 

shipment program, its designated State 

personnel will need to attend FSISsponsored training in person. Thus, 

FSIS will not be providing the required 

training through on-line courses as 

suggested by the comment. The Agency 

may, however, make supplemental 

training materials available on-line. 

5. ‘‘Same as’’ Laboratory Testing and 

Analysis 

The preamble to the proposed rule 

explained that to qualify for an 

interstate shipment program, States will 

need to demonstrate that the laboratory 

services that they intend to use to 

analyze regulatory product samples 

from selected establishments are 

capable of conducting the same 

chemical, microbiological, physical, and 

pathology testing as are required under 

the Federal meat and poultry products 

inspection programs (74 FR 47652). The 

preamble also explains that FSIS’s 

Office of Public Health Science (OPHS) 

will provide laboratory audit assistance 

to the State to verify that the 

methodologies used by a State’s 

laboratory services to analyze samples 

from selected establishments are 

capable of producing the same results as 

the methodologies used by FSIS 

laboratories. 

Comment: Some comments agreed 

that State-inspected establishments 

participating in the cooperative 

interstate shipment program should be 

subject to the same regulatory sampling 

programs as those established in the 

Federal inspection program. One 

comment stated that positive results on 

pathogen and residue testing on 

products produced in selected 

establishments should lead to the same 

regulatory actions that federallyinspected establishments are subjected 

to. 

Two comments stated that they were 

encouraged by the requirements for 

regulatory sampling and laboratory 

analysis described in the proposed rule. 

The comments stated that a robust 

residue, microbiological, and 

pathological analysis capability will 

assure accuracy of these test results, 

which, according to the comments, is 

essential for maintaining foreign 

markets. 

Response: The comments present 

valid reasons for requiring that the 

selected establishments participating in 

the cooperative interstate shipment 

program be subject to the same 

regulatory sampling required under the 

Federal program. 

Comment: Several comments 

requested that FSIS clarify its 

expectations with regard to the 

laboratory services used by States to 

analyze samples under the cooperative 

interstate shipment program. Many 

comments specifically asked whether 

FSIS expects these laboratories to be 

(International Organization for 

Standards) ISO accredited. Several 

comments expressed concern that if 

FSIS requires laboratories that analyze 

samples for the cooperative interstate 

shipment program to be ISO accredited, 

some laboratories will have to abandon 

perfectly acceptable procedures, or 

possibly more up-to-date procedures, to 

perform the methodology executed at 

the FSIS laboratories. The comments 

also said that some states would need to 

hire additional personnel to perform the 

increased paperwork with no additional 

benefit in the quality or quantity of tests 

performed. 


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Response: The laboratory services that 

States use to analyze samples collected 

under the cooperative interstate 

shipment must be capable of producing 

the same results as FSIS’s laboratories. 

Therefore, to demonstrate that the 

laboratory services used by a State are 

sufficient for the State to qualify for the 

cooperative interstate shipment 

program, the State will need to show 

that the laboratory is accredited by an 

internationally recognized organization 

that accredits food testing laboratories 

against the ISO 17025 ‘‘General 

Requirements for the Competence of 

Testing and Calibration Laboratories’’ 

and AOAC ‘‘Guidelines for Laboratories 

Performing Food Microbiological and 

Chemical Analyses of Food and 

Pharmaceuticals Testing’’ written by the 

Analytical Laboratory Accreditation 

Criteria Committee (ALACC). The 

assessment body that FSIS uses, the 

American Association for Laboratory 

Accreditation (A2LA), is the sole 

organization that incorporates ALACC 

into their program requirements. State 

labs would need to use A2LA or another 

accrediting body that incorporates 

ALACC and is a signatory and in good 

standing to the Mutual Recognition 

Arrangements of the International 

Laboratory Accreditation Cooperation 

(ILAC). 

The laboratory will also need to use 

the protocols for analytical tests 

required for FSIS regulatory activities 

on meat and poultry products described 

in the FSIS Chemistry, Microbiological, 

and Pathology Laboratory Guidebooks. 

However, if the laboratory that a State 

intends to use to analyze samples for the 

cooperative interstate shipment program 

is unable to follow an FSIS method as 

written, the State may submit a 

justification to FSIS that: (1) Explains 

why the laboratory is unable to follow 

the FSIS methodology and (2) describes 

the modifications that the laboratory 

intends to make to the FSIS 

methodology. FSIS will evaluate the 

State’s justification to determine 

whether the modification of FSIS 

methodology is minimal and 

supportable through validation or other 

evidence. FSIS will allow a State to use 

the modified method if the Agency 

determines that methodology is 

consistent with the original FSIS 

protocol and the State’s method is 

capable of achieving results that are 

consistent with the corresponding FSIS 

method. 

To assist the States in developing 

laboratory services that are ‘‘the same 

as’’ those provided under the Federal 

inspection program, FSIS is adopting a 

‘‘phased in’’ approach for the States to 

become ISO 17025 accredited. OPHS 

has developed a Quality Assurance (QA) 

checklist based on ISO 17025 and 

ALACC criteria. It is not as extensive as 

ISO 17025, but contains minimum QA 

practices that laboratories should follow 

to be able to defend their results. The 

checklist is included as an appendix in 

FSIS’s guidance for ‘‘at least equal to’’ 

State MPI programs. States that use 

services from laboratories that are not 

ISO 17025 accredited but that can 

demonstrate that the laboratories meet 

the laboratory criteria in the FSIS QA 

checklist will be permitted to 

participate in the cooperative interstate 

shipment program if they agree to 

actively seek and obtain ISO 

accreditation within two years. 

However, if the laboratory fails to 

actively seek or does not obtain the 

necessary accreditation, FSIS will 

terminate the State’s cooperative 

agreement for the interstate shipment 

program. 

FSIS is developing materials to assist 

States whose laboratory services are 

pursuing ISO accreditation to meet the 

requirements to become accredited. 

States may also use an outside 

laboratory to analyze samples collected 

under the cooperative interstate 

shipment program if the outside 

laboratory has the necessary 

accreditation. 

States that currently use laboratories 

with active ISO 17025 accreditations 

will need to submit the necessary 

documentation for FSIS to verify that 

the laboratories are ISO accredited and 

meet ALACC food laboratory 

requirements as assessed by an 

appropriate accreditation body. To 

remain eligible for the programs, States 

will need to demonstrate, through 

documented third-party audits or other 

appropriate documentation, that their 

laboratories are maintaining their 

accreditation and are continuing to use 

methods described in FSIS Laboratory 

Guidebooks. 

Comment: One comment asserted that 

instead of conducting the same number 

and type of sampling that is conducted 

under FSIS’s sampling programs, the 

Agency should allow States to develop 

sampling programs that reflect the same 

number of samples over the broad 

spectrum of meat products produced 

under the cooperative interstate 

shipment program. According to the 

comment, States may very well conduct 

more sampling or more comprehensive 

sampling than Federal programs. The 

comment also suggested that FSIS 

provide States with production data to 

guide them in selecting the same 

number or more samples based on the 

same volumes under FSIS inspection 

programs. 

Response: To qualify for the 

cooperative interstate shipment program 

States must, at a minimum, collect and 

analyze the same number and type of 

regulatory product samples from 

selected establishments as are collected 

and analyzed under FSIS’s inspection 

sampling program. If they have met the 

sampling requirements provided for in 

FSIS’s regulatory sampling programs, 

States may collect additional samples or 

conduct additional analyses if they 

choose to do so. FSIS will provide 

guidance to States in determining the 

appropriate number of samples that they 

will need to collect to be the same as the 

Federal regulatory sampling program. 

Comment: Some comments noted that 

establishing a national laboratory 

program to analyze samples collected 

under the cooperative interstate 

shipment program would be more 

economically viable than requiring that 

each State program conduct a laboratory 

program that is ‘‘the same as’’ FSIS’s. 

According to the comments, it is 

economically unreasonable for States to 

set up and maintain equipment 

necessary for running extremely rare 

samples. 

Response: States that do not have the 

laboratory capability to conduct the 

necessary sampling and analyses 

required under the cooperative 

interstate shipment program are 

permitted to submit samples collected 

under the cooperative interstate 

shipment program to an outside 

laboratory that does. The States may 

rely on the sample results obtained from 

an outside laboratory if the State, in 

coordination with FSIS’s OPHS, has 

verified that the laboratory has the 

necessary accreditation and is capable 

of producing the same results obtained 

by FSIS’s laboratories. 

Comment: One comment stated that 

the level of oversight that FSIS intends 

to have over State laboratories under the 

cooperative interstate shipment program 

is unnecessary. The comment suggested 

that, if FSIS intends to oversee the 

analysis of samples collected from 

selected establishments, it should offer 

to analyze all samples from eligible 

establishments at FSIS laboratories at no 

cost to the State program. 

Response: FSIS does not intend to 

oversee the analysis of samples 

collected from selected establishments. 

The Agency intends to consult with the 

States to verify that the laboratories that 

States use to analyze samples from 

selected establishments are capable of 

producing the same results as FSIS’s 

laboratories. 

Comment: One comment included a 

number of questions that the commenter 

requested FSIS address before the 


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24728 Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 

Agency issues the final rule to 

implement the cooperative interstate 

shipment program. The questions are as 

follows: 

• Will the kidney inhibition swab 

(KIS) test for detecting antimicrobial 

drug residues be required in 

establishments selected for the program, 

or will other tests be acceptable? 

• If KIS is necessary, will every 

facility be required to have an incubator, 

or can samples be sent to the state 

laboratory, requiring only one 

incubator? 

• If an establishment decides to 

participate in both the cooperative 

program and the state inspection 

program, would the sampling program 

required by FSIS be sufficient, or would 

they also have to participate in the 

State’s sampling program? 

• Could the selected establishments 

be put into the FSIS sampling program, 

with FSIS sending sample requests and 

supplies, and the samples analyzed at 

Federal labs? 

• What process must be followed if a 

state’s laboratory wants to request audit 

help? 

• Will the recommendations of the 

auditor be the official required 

adjustments the lab must make to allow 

the state to participate in the program? 

Response: As noted above, the 

laboratory services that a State uses to 

analyze samples under the cooperative 

interstate shipment program must use 

methods that are capable of producing 

results that are ‘‘the same as’’ those 

obtained from the methods used by 

FSIS’s laboratories. Therefore, the KIS 

test for detecting antimicrobial drug 

residues used by FSIS is the acceptable 

test. Samples may be sent to and 

analyzed by the State laboratory if FSIS 

has evaluated and approved any minor 

modifications to the procedures 

described in the FSIS Laboratory 

Guidebooks. 

If an establishment participates in 

both the cooperative interstate shipment 

program and the cooperative State MPI 

program, the sampling conducted under 

the cooperative interstate shipment 

program must be ‘‘the same as’’ the 

sampling conducted under the Federal 

program, while the samples collected 

under the State MPI program must meet 

standards that are ‘‘at least equal to’’ the 

Federal program. 

States that participate in the 

cooperative interstate shipment program 

are responsible for scheduling, 

collecting and analyzing samples 

required under the program. FSIS will 

not collect or analyze regulatory 

samples for the cooperative interstate 

shipment program. 

The SEC assigned to the State will 

facilitate the process for the State to 

obtain the necessary audit assistance 

from FSIS’s OPHS. As noted above, 

OPHS will provide guidance and advice 

on laboratory accreditation 

requirements. However, the laboratories 

themselves will be responsible for 

obtaining the necessary ISO 

accreditation. 

6. Related Activities 

Comment: Some comments requested 

that FSIS clarify what States need to do 

to demonstrate they are able to ‘‘conduct 

any related activities that would be 

required under a cooperative interstate 

shipment program,’’ as required under 

the proposed regulations. The 

comments said that the final rule must 

specifically describe the ‘‘related 

activities’’ required under the 

cooperative agreement or else the 

Agency should remove this statement. 

One comment said that requiring that 

States conduct ‘‘related activities’’ adds 

requirements for a State program that 

are outside of what is authorized by the 

enabling statute, and is both unclear and 

unnecessary. The comment said that 

FSIS should not be attempting to 

impose ancillary requirements on the 

States through the cooperative 

agreement process. According to the 

comment, the State’s ability to provide 

inspection service to selected 

establishments in accordance with the 

statute is all that is authorized and, 

therefore, all that is necessary. 

Response: The term ‘‘related 

activities’’ refers to any activities that are 

necessary to ensure that the inspection 

services provided to selected 

establishments are ‘‘the same as’’ the 

inspection services provided to Federal 

establishments. Such activities include, 

but are not limited to, scheduling, 

collecting and analyzing regulatory 

samples, issuing export certificates for 

establishments that will be exporting 

products to foreign countries, and 

verifying that selected establishments 

are humanely handling livestock in 

connection with slaughter. 

E. Additional Conditions for State 

Participation 

In addition to requiring that a State’s 

requests for an interstate shipment 

program include documentation to 

demonstrate that it is capable of 

providing the necessary inspection 

services to selected establishments in 

the State, the proposed regulations also 

require that, in its request, the State 

must agree to: (1) Provide FSIS with 

access to the results of all laboratory 

analyses conducted on product samples 

from selected establishments in the 

State; (2) inform the SEC for the State of 

any laboratory results that indicate that 

a product produced in a selected 

establishment may be adulterated or 

may otherwise present a food safety 

concern; and (3) if necessary, cooperate 

with FSIS to transition selected 

establishments in the State that have 

been deselected from a cooperative 

interstate shipment program to become 

official establishments (proposed 9 CFR 

332.4(b)(3) and 381.187(b)(3)). 

The proposed regulations also provide 

that when States submit their requests 

for an interstate shipment program, they 

must include a list of establishments 

that have requested to participate in the 

program and that the State recommends 

for initial selection into the program 

(proposed 9 CFR 332.4(b)(1) and 

381.187(b)(1)). 

Comment: Two comments suggested 

that FSIS remove the provision in the 

proposed regulations that requires that 

States give FSIS access to the results of 

all laboratories analyses conducted at 

selected establishments. The comments 

stated that such a requirement is 

unnecessary because the States are also 

required to notify the SEC of results that 

indicate that a product produced in a 

selected establishment may be 

adulterated or may otherwise present a 

food safety hazard. 

Response: Although the States are 

required to notify the SEC of laboratory 

results that indicate that a product 

produced in a selected establishment 

may be adulterated or present a food 

safety hazard, the SEC or other FSIS 

personnel also need to have access to 

the results of the laboratory analyses 

conducted on products produced in 

selected establishments to verify that 

these establishments are operating in a 

manner that complies with the Acts. 

Comment: One comment stated that, 

as written, the proposed requirement 

that States give FSIS ‘‘access’’ to all 

laboratory results could be interpreted 

as requiring that FSIS have electronic 

access, via a particular system, to the 

results of testing conducted by State 

programs. According to the comment, 

when an integrated electronic system for 

data sharing is developed, funded, and 

implemented, State programs will share 

laboratory results with FSIS 

electronically. The comment maintained 

that the cooperative interstate shipment 

program should not unintentionally 

limit the methods by which analytical 

results are shared with FSIS before an 

electronic system is fully operational. 

Response: The regulations do not 

prescribe the methods by which States 

are required to share their analytical 

results with FSIS. States may share 

analytical results with FSIS 


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Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 24729 

electronically or they may provide hard 

copies. The only requirement is that 

they give FSIS access to these results 

upon request. 

Comment: One comment said that the 

proposed requirement that the State 

notify the SEC when laboratory results 

indicate that a product from a selected 

establishment may be ‘‘adulterated or 

may otherwise present a food safety 

concern’’ is overly broad and redundant. 

The comment asserted that any product 

that presents a food safety concern is, by 

definition, adulterated. The comment 

suggested that FSIS delete the phrase 

‘‘may otherwise present a food safety 

concern’’ in the final regulations. 

Response: There may be instances in 

which a product presents a food safety 

concern but it is unclear as to whether 

the product is adulterated under the 

FMIA or PPIA. For example, a 

preliminary laboratory result may 

indicate that a product that has been 

distributed in commerce is 

contaminated with a pathogen but the 

laboratory needs to complete the 

analysis to confirm these results. The 

SEC needs to be made aware of these 

situations to verify that the 

establishment and States have 

responded to the preliminary result in a 

manner that complies with the Federal 

Acts and implementing regulations. 

Comment: One comment stated that, 

instead of requiring that a State’s 

request for a cooperative interstate 

shipment program include a list of 

establishments that have submitted 

requests to participate in the program 

and that the State recommends for the 

program, the final regulations should 

permit States to submit a request for a 

cooperative interstate shipment program 

before they have identified 

establishments interested in being 

selected for the program. According to 

the comment, this would allow the State 

and Federal programs to work out any 

issues with their relationship before 

offering the program to establishments. 

Response: FSIS agrees with this 

comment. The Agency has modified the 

regulations to require that a State’s 

request for a cooperative interstate 

shipment program include a list of 

establishments that have submitted a 

request to participate in the program, if 

any. This will allow States to request an 

agreement for a cooperative interstate 

shipment program before they have 

identified establishments interested in 

participating in the program. However, 

FSIS will only reimburse States for 60% 

of their eligible costs to administer the 

program if, after entering into a 

cooperative agreement, establishments 

in the State are selected for, and 

participate in, the program. 

Comment: A few comments stated 

that, in addition to verifying that States 

have sufficient authority, resources, 

personnel, training, sampling capability 

and laboratory capacity to provide the 

necessary inspection services to selected 

establishments in the State, FSIS will 

also need to monitor budget issues in 

participating States on an ongoing basis 

to ensure that States continue to have 

sufficient resources to participate in the 

program. The comments noted that 

many State governments are under 

financial duress and have had to make 

budget cuts in their State inspection 

programs. One comment said that even 

though FSIS is required to reimburse 

States for at least 60% of their eligible 

costs associated with the cooperative 

interstate shipment program, the 

Agency will need to verify that States 

interested in participating in the new 

program will be able to meet Federal 

inspection regulatory requirements 

during these hard economic times. 

Response: States that enter into an 

agreement with FSIS for a cooperative 

interstate shipment program will be 

required to prepare annual budgets to 

cover the costs for the cooperative 

interstate shipment program, maintain 

complete accounting records, and 

conduct all other financial 

accountability activities just as they do 

for the State MPI program. FSIS will 

terminate a State’s agreement for a 

cooperative interstate shipment program 

if the State does not have sufficient 

finances to comply with all aspects of 

the cooperative interstate shipment 

program. 

F. Selection Process 

Under the proposed regulations, 

State-inspected establishments that are 

interested in participating in the 

cooperative interstate shipment program 

must apply for the program through 

their State (proposed 9 CFR 332.5(a)(1) 

and 381.515(a)(1)). If a State determines 

that an establishment operating under 

the State’s meat or poultry products 

inspection program qualifies for 

selection into a cooperative interstate 

shipment program, and the State is able 

and willing to provide the necessary 

inspection services to the establishment, 

the State is to submit its evaluation of 

the establishment through the FSIS 

District Office that covers the State (74 

FR 47653). The proposed rule provides 

that the FSIS Administrator, in 

coordination with the State, will decide 

whether to select the establishment for 

the program (proposed 9 CFR 332.5(b) 

and 381.151(b)). 

Comment: Some comments said that 

the State inspection program is the 

government entity best suited to begin 

the process of selecting establishments 

for the cooperative interstate shipment 

program. According to the comments 

the States, not the FSIS Administrator, 

should be responsible for selecting 

establishments to participate in the 

program. The comments suggested that 

after initiating the selection process, the 

State program could collaborate with 

the FSIS SEC, who can visit the 

establishments that are under 

consideration for selection into the 

cooperative interstate shipment 

program. 

Response: FSIS agrees that the States 

are best suited to begin the process of 

determining which establishments in 

the State are eligible for selection to the 

cooperative interstate shipment 

program. Therefore, the proposed rule 

requires that establishments interested 

in participating in the cooperative 

interstate shipment program apply for 

the program through the State in which 

they are located (proposed 9 CFR 

332.5(a) and 381.515(a). After the State 

recommends establishments for the 

program, the law requires that the FSIS 

Administrator coordinate with the State 

to select establishments for the program 

(21 U.S.C. 683(b)(1) and 472(b)(1)). 

Comment: One comment argued that 

the regulations do not need to include 

a process for selecting establishments to 

participate in the cooperative interstate 

shipment program because 

establishments operating under the 

State MPI programs are already under 

an inspection system that provides for 

food safety in a manner that is ‘‘at least 

equal to’’ the Federal inspection 

program. According to the comment, 

there is no need for selection because 

the entire State program has already 

been approved. 

Response: The law requires that the 

FSIS Administrator, in coordination 

with the State, select establishments to 

participate in the new cooperative 

interstate shipment program (21 U.S.C. 

683(b) and 472(b)). There is nothing in 

the law to indicate that establishments 

operating under the existing State MPI 

programs have already been approved 

for the cooperative interstate shipment 

program. Therefore, these final 

regulations include procedures for 

selecting establishments for the 

program. 

Comment: One comment suggested 

that the final rule require that selected 

establishments undergo an on-site 

review by FSIS at least 30 days before 

they become eligible to participate in 

the cooperative interstate shipment 

program. The comment noted that such 

a review would help to guarantee that 

selected establishments that wish to 

ship their meat products in interstate 


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24730 Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 

2Examples of establishments that are ineligible 

for the cooperative interstate shipment program 

include official Federal establishments, 

establishments located in a State that has a State 

MPI program, establishments in violation of the 

FMIA or PPIA, establishments that are the subject 

of a transition to become a Federal plant, and 

establishments located in a State without a State 

MPI program. 

commerce are in compliance with 

Federal law. 

Response: The preamble to the 

proposed rule explained that, as part of 

the selection process, the SEC assigned 

to a State, in coordination with the 

State, will verify that each 

establishment in the State that has 

applied to participate in a cooperative 

interstate shipment program is in 

compliance with all Federal standards 

(74 FR 47653). To verify such 

compliance, the SEC will coordinate 

with the State to conduct on-site 

reviews of each establishment that has 

applied, and that the State recommends, 

for selection into the program. 

Comment: One comment said that 

FSIS should better explain how 

establishments may be selected for the 

cooperative interstate shipment 

program. 

Response: The preamble to the 

proposed rule provides a detailed 

description of the proposed selection 

process. FSIS is adopting that process in 

this final rule. 

As proposed, State-inspected 

establishments that are interested in 

participating in a cooperative interstate 

shipment program will be required to 

apply for the program through the State 

agency that administers the State MPI 

program. States are responsible for 

establishing their own application 

procedures. The State will then evaluate 

the establishment to determine whether 

it qualifies for selection. To qualify for 

selection to the cooperative interstate 

shipment program, an establishment 

must: 

• Have the appropriate number of 

employees; 

• Not be ineligible for a cooperative 

interstate shipment program 2; 

• Be in compliance with all 

requirements under the State inspection 

program; and 

• Be in compliance with all Federal 

meat or poultry products inspection 

requirements. 

If a State determines that an 

establishment operating under the 

State’s MPI program qualifies for 

selection into a cooperative interstate 

shipment program, and the State is able 

and willing to provide the necessary 

inspection services to the establishment, 

the State is to submit its evaluation of 

the establishment through the FSIS 

District Office that covers the State. The 

FSIS Administrator, in coordination 

with the State, will then decide whether 

to select the establishment for the 

program. 

In deciding whether to select an 

establishment that the State has 

recommended for the cooperative 

interstate shipment program, the 

Administrator will consider whether the 

establishment qualifies for the program 

and whether the Agency has the 

resources that it needs to provide the 

required oversight of the establishment 

if it is selected for the program. Before 

an establishment can be selected, the 

SEC, in coordination with the State, 

must verify, through record reviews and 

on-site visits, that the establishment is 

in compliance with all Federal 

inspection requirements under the 

FMIA, PPIA, and their implementing 

regulations in title 9, chapter III, of the 

CFR. 

G. Mark of Inspection and Official 

Number 

The proposed regulations require that 

inspection services for selected 

establishments be provided by 

designated State personnel, and that 

articles prepared or processed in a 

selected establishment that have been 

inspected and passed by designated 

personnel bear an official Federal mark 

of inspection (proposed 9 CFR 332.6(c) 

and 381.516(c)). The proposed 

regulations also require that the Federal 

mark contain a selected establishment 

number assigned to the establishment 

by the State. The proposal provides that 

the number must include, as a suffix, 

the abbreviation for the State in which 

the establishment is located, as well as 

the abbreviation ‘‘SE’’ for selected 

establishment (e.g. ‘‘38SETX’’ as a 

number for a selected establishment in 

Texas). If the establishment processes 

poultry products, the suffix must also 

contain a ‘‘P,’’ (e.g., 38 SEPND for a 

selected poultry establishment in North 

Dakota) (proposed 9 CFR 332.5(c) and 

381.515(c)). The proposed regulations 

also state that States that fail to assign 

an establishment number to selected 

establishments in the State and report 

the number to the SEC for the State will 

not qualify to participate in the program 

(proposed 9 CFR 332.5(d) and 

381.515(d)). 

Comment: Some comments expressed 

concern that allowing State-inspected 

meat and poultry products to bear a 

Federal mark of inspection will make it 

difficult to maintain the integrity of the 

Federal mark. One comment stated that 

the integrity of the Federal mark will be 

diminished if a State-inspected product 

distributed in interstate commerce is 

recalled or found to be adulterated. 

Another comment said that allowing 

State-inspected products to bear a 

Federal mark of inspection is 

misleading because consumers that see 

a Federal mark of inspection on the 

label of a meat or poultry product will 

think that the product is the same as all 

other federally-inspected products. The 

comment noted that the FMIA and PPIA 

both prohibit labeling that is false or 

misleading. 

Response: Under the 2008 

amendments to the Acts, meat and 

poultry products produced under the 

cooperative interstate shipment that 

designated State personnel have 

determined are in compliance with all 

Federal standards are required to bear a 

‘‘Federal mark, stamp, tag, or label of 

inspection’’ (21 U.S.C. 472(b)(1) and 

683(b)(1)). Thus, requiring that articles 

prepared or processed in a selected 

establishment that have been inspected 

and passed by designated personnel 

bear an official Federal mark is 

consistent with the law. Such a 

requirement will not diminish the 

integrity of the Federal mark or be 

misleading to consumers, as suggested 

by the comments, because all meat and 

poultry products that bear the Federal 

mark will have been produced under 

Federal standards. 

Comment: Some comments 

maintained that it is not necessary to 

require that the meat and poultry 

products produced under the 

cooperative interstate shipment program 

bear a Federal mark of inspection 

because States that have MPI 

cooperative agreements already provide 

State marks. A State Department of 

Agriculture and a State agency 

commented that many State-inspected 

establishments prefer that their products 

bear the State mark of inspection. The 

comments claimed that requiring that 

selected establishments apply a Federal 

mark and identify the State in the 

establishment number is unacceptable 

to most plant owners. Another comment 

argued that requiring that a Federal 

mark of inspection be applied to 

products that have been inspected by a 

State inspector under a cooperative 

State meat inspection program is 

counterintuitive and does not 

accomplish the goal of providing for 

interstate shipment of State-inspected 

products. 

Response: The 2008 amendments to 

the Acts require that meat and poultry 

products produced under the 

cooperative interstate shipment program 

bear a Federal mark of inspection. 

As noted above, under the proposed 

regulations, the Federal mark is required 

to contain a selected establishment 


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Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 24731 

number assigned to the establishment 

by the State. The selected establishment 

number is required to include, as a 

suffix, the abbreviation for the State in 

which the establishment is located, as 

well as the abbreviation ‘‘SE’’ for 

selected establishment (e.g. ‘‘38SETX’’ as 

a number for a selected establishment in 

Texas). If the establishment processes 

poultry products, the suffix must also 

include a ‘‘P’’ before State abbreviation 

(e.g., 38 SEPND for a selected poultry 

establishment in North Dakota). Thus, 

although meat and poultry products 

produced in selected establishments 

will not bear a State mark of inspection, 

the State in which the product was 

produced can be readily identified by 

referencing the selected establishment 

number that is required to appear inside 

the Federal mark. 

Comment: Some comments agreed 

that products produced in selected 

establishments should bear a Federal 

mark of inspection but also suggested 

that such products be allowed to bear a 

State mark if the establishment so 

chooses. According to the comments, 

many State-inspected establishments 

believe that compliance with their State 

inspection program requirements along 

with the Federal standards provides a 

marketing advantage and that 

appearance of the State mark may add 

value to State-inspected products sold 

in interstate commerce. One comment 

noted that because their State mark of 

inspection is an outline of the State, 

selected establishments in the State 

could use the State mark to promote 

their products interstate. 

Response: It is not necessary for meat 

or poultry products that have been 

processed or prepared in selected 

establishments to bear both a State and 

Federal mark because the product’s 

State-of-origin can be identified by the 

selected establishment number that is 

required to appear in the Federal mark. 

Moreover, allowing products produced 

under Federal standards to bear both a 

Federal and State mark of inspection 

may be misleading to consumers and 

foreign trade partners because the law 

prohibits interstate shipment of 

products produced under State MPI 

programs. Allowing both Federal and 

State marks could also be confusing to 

consumers and make it difficult for 

them to identify products potentially 

implicated in outbreaks or subject to 

recall. 

Selected establishments that were 

interested in using the State mark to 

market meat or poultry products 

produced under the cooperative 

interstate shipment program could use 

labeling statements information to 

identify where the product was 

produced instead, provided that the 

statement is truthful and not 

misleading. For example, the label of a 

meat product produced in a selected 

establishment in Texas, could contain 

the statement ‘‘prepared in Texas,’’ if the 

statement is presented in a manner that 

is truthful and not misleading to 

consumers. 

Comment: Some comments suggested 

that instead of requiring that States 

assign a new official State establishment 

number to selected establishment, FSIS 

should allow establishments that 

participate in the cooperative interstate 

shipment program to retain their official 

State number in conjunction with the 

suffix ‘‘SE.’’ 

Response: There is nothing in the 

proposed rule that would prevent a 

State from allowing establishments 

selected for the cooperative interstate 

shipment program to retain their official 

State number, provided that the suffix 

‘‘SE’’ is added to original State 

establishment number. The ‘‘SE’’ suffix 

is necessary to make clear that the 

establishment associated with the 

number is a selected establishment. 

Comment: One comment noted that 

the proposed regulations identify the 

‘‘SE’’ that is required to appear as part 

of a selected establishment’s official 

State number as a suffix. The comment 

stated that the ‘‘SE’’ designation is, in 

fact, a prefix. 

Response: FSIS refers to the ‘‘SE’’ 

along with the State abbreviation as a 

‘‘suffix’’ because these abbreviations 

follow the number assigned to the 

selected establishment. 

Comment: One comment objected to 

the provision in the proposed 

regulations that provide that a State that 

fails to assign an official State number 

to the selected establishments in the 

State and inform the SEC will be 

disqualified from participating in the 

cooperative interstate shipment 

program. The comment believed that 

disqualification is an overly harsh 

penalty for what may be a simple 

omission. The comment suggested that 

in the final rule, FSIS replace the 

statement that failure to assign an 

official number ‘‘will disqualify the 

State’’ to ‘‘may disqualify the State.’’ 

Response: As explained in the 

preamble to the proposed rule, full 

compliance by a State with the 

requirements for assigning official 

establishment numbers to 

establishments selected for the 

cooperative interstate shipment program 

is essential if the program is to succeed 

(74 FR 57654). FSIS will give States that 

inadvertently fail to assign a proper 

establishment number to a selected 

establishment an opportunity to take 

corrective actions to comply with the 

regulations. However, failure to comply 

with the establishment number 

requirements in this final rule will 

disqualify a State from participating in 

the cooperative interstate shipment 

program. 

Comment: Several comments 

submitted by State Departments of 

Agriculture and State agencies 

requested that in the final rule FSIS 

make clear that it will permit selected 

establishments to produce products 

under both the cooperative interstate 

shipment program and the State MPI 

program. The comments noted that FSIS 

allows establishments with both a 

Federal grant and State grant of 

inspection to operate as both a Federal 

plant and a State plant if they maintain 

an appropriate separation by time or 

space between the State and Federal 

operations and that the products are 

appropriately marked. The comments 

noted that in a letter to the National 

Association of State Departments of 

Agriculture (NASDA) dated September 

15, 2009, the Deputy Secretary of 

Agriculture said that FSIS expects to 

apply a similar policy to selected 

establishments that are interested in 

continuing to produce certain products 

solely for distribution in the State under 

the State MPI program. The comments 

maintained that allowing for this type of 

flexibility will benefit rural America 

and is necessary for the success of the 

new program. 

One comment said that if the final 

rule permits selected establishments to 

produce products under both the State 

MPI program and the cooperative 

interstate shipment program, FSIS 

should allow these establishments to 

continue to apply the State mark to 

products that are not produced under 

the cooperative interstate shipment 

program. 

Response: FSIS has considered these 

comments and has decided to revise the 

proposed regulations to allow selected 

establishments to conduct operations 

under both the cooperative interstate 

shipment program and the State MPI 

program if those establishments 

implement and maintain written 

procedures for complete physical 

separation of product and process for 

each operation by time or space. An 

establishment may provide for 

separation by space by conducting its 

State MPI operations in an area that is 

physically separate from the area in 

which it conducts operations under the 

cooperative interstate shipment 

program. Alternatively, an 

establishment may conduct each 

operation in the same area provided that 

the separation in space is sufficient to 


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ensure that potential food safety 

hazards, such as microbiological 

pathogens, if present, are not likely 

spread from one area to another through 

aerosolization, air ducts, air currents, 

employees, or other means and that 

there is no co-mingling of product. 

Establishments that chose to conduct 

both operations in the same area must 

clearly identify and distinguish the 

State MPI operation from the 

cooperative interstate shipment 

operation. For example, the 

establishment might designate certain 

employees on a given day to work 

exclusively on the State MPI operations 

and have these employees wear white 

clothing, and designate other employees 

to work exclusively on the cooperative 

interstate shipment operations and have 

these employees wear yellow clothing. 

The establishment could also color-code 

knives and other equipment associated 

with each operation. 

In addition to separation by space, an 

establishment may conduct the State 

MPI operations and cooperative 

interstate shipment operations at 

separate times if the establishment’s 

procedures for separation address cleanup between operations. Establishments 

that conduct both operations in the 

same facility and on the same 

equipment, and that separate the 

operations by time, will need to fully 

clean and sanitize the facilities and 

equipment in between operations as set 

out in their Sanitation SOPs. 

Establishments that conduct 

operations under both the State MPI 

program and the cooperative interstate 

shipment program will also need to 

establish written procedures to ensure 

that product produced under the State 

MPI program will not become comingled with product produced under 

the cooperative interstate shipment 

program. The procedures will need to 

ensure that products produced under 

each program are appropriately 

identified as State MPI product or 

cooperative interstate shipment 

products, and that each product bears 

the appropriate mark of inspection. 

Establishment will also need to 

maintain physical separation of product 

produced under the State MPI program 

from products produced under the 

cooperative interstate shipment program 

throughout the process, either through 

the use of separate facilities or by 

designated areas for holding or storing 

products produced under separate 

operations. 

The meat or poultry products 

produced when the establishment is 

operating under the State MPI program 

will be required to bear the State mark 

of inspection and will only be permitted 

to be distributed within the State. Meat 

or poultry products produced when the 

establishment is operating under the 

cooperative interstate shipment program 

will be required to bear a Federal mark 

and may be shipped in interstate 

commerce. 

H. Oversight and Enforcement— 

Selected Establishment Coordinator 

The preamble to the proposed rule 

explained that the statute requires that 

FSIS appoint a ‘‘state coordinator’’ to 

‘‘provide oversight and enforcement’’ of 

the cooperative interstate shipment 

program and ‘‘to oversee the training 

and inspection activities’’ of State 

personnel designated to provide 

inspection services to selected 

establishments (74 FR 47654). When 

FSIS issued the proposed rule, the 

Agency explained that the ‘‘state 

coordinator’’ required by statute would 

be referred to as the ‘‘selected 

establishment coordinator’’ (SEC) in the 

proposed regulations to avoid confusion 

with the ‘‘State coordinator’’ under the 

Talmadge-Aiken program, which is a 

State employee. In the preamble to the 

proposed rule, FSIS also explained that 

the Agency had tentatively decided that 

the SEC would be an employee of the 

FSIS Office of Field Operations (OFO) 

and would be assigned to an FSIS 

district office. 

1. SEC Definition and FSIS Program 

Area 

Comment: One comment stated that 

the codified text in the final rule should 

clarify that the term ‘‘selected 

establishment coordinator’’ as used in 

the implementing regulations is 

synonymous with the term ‘‘state 

coordinator’’ under the statute. The 

comment said that there should not be 

both a State coordinator and an SEC. 

Response: As noted in the preamble to 

the proposed rule, the term ‘‘State 

coordinator’’ is often used to refer to a 

State employee under the TalmadgeAiken program. Therefore, to make clear 

that the ‘‘State coordinator’’ for the 

cooperative interstate shipment program 

is an FSIS employee, this final rule 

identifies that employee as the FSIS 

‘‘selected establishment coordinator’’ in 

the codified text. The codified text in 

the final rule does not provide for both 

a State coordinator and an SEC. 

Comment: Some comments stated 

that, instead of being under the direct 

supervision of an FSIS District Manager, 

as FSIS tentatively decided in the 

proposed rule, the SEC should be under 

the direct supervision of the Secretary of 

Agriculture as provided under the 

statute. 

Other comments agreed with FSIS’s 

tentative determination that the SECs 

operate out of the district offices. One 

comment noted that the SEC is a Federal 

employee. The comment stated that, as 

such, it is appropriate that the SEC be 

stationed at the district office and report 

to a District Manager and ultimately, 

FSIS headquarters. The comment 

asserted that the SEC should not be 

stationed at the State meat and poultry 

inspection agency, but should maintain 

frequent communication with State 

agency officials. 

Response: The Secretary of 

Agriculture has delegated the 

administration and enforcement of the 

cooperative interstate shipment program 

to FSIS. Since the SEC will be an FSIS 

employee that operates out of the FSIS 

district office, it is appropriate for the 

SEC to be under the direct supervision 

of the FSIS District Manager. 

Comment: Several comments were 

concerned about the Agency’s tentative 

decision to assign the SEC to an FSIS 

district office. According to the 

comments, FSIS district offices are not 

always consistent in their interpretation 

and enforcement of the Agency’s 

policies. The comments stated that 

administering the cooperative interstate 

shipment program from different district 

offices will make it difficult for FSIS to 

implement and enforce the program in 

a consistent manner. The comment 

suggested that, instead of assigning 

SECs to multiple district offices, FSIS 

should designate a single entity within 

the Agency to implement and enforce 

the cooperative interstate shipment 

program. 

Some comments suggested that FSIS 

create a branch in OPEER, similar to the 

Federal/State Audit Branch (FSAB), or 

assign the FSAB to administer, review, 

and enforce the cooperative interstate 

shipment program. The comments noted 

that the OPEER/FSAB is already 

responsible for verifying that the State 

MPI programs are operating in a manner 

that is ‘‘equal to’’ the Federal standards, 

and States now spend a considerable 

amount of time providing information to 

OPEER/FSAB. The comments stated 

that allowing a centralized Agency 

branch, such as the OPEER/FSAB, to 

administer and enforce the cooperative 

interstate shipment program will 

promote consistency in the program by 

providing the FSIS SECs, the State 

programs, and selected establishments 

with a single point of contact for 

guidance, policy implementation, and 

enforcement. 

Response: The FSIS SEC is required to 

provide ‘‘oversight and enforcement’’ of 

the cooperative interstate shipment 

program and ‘‘to oversee the training 


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and inspection activities’’ of State 

personnel designated to provide 

inspection services to selected 

establishments (21 U.S.C. 683(d)(1) and 

472(d)(1)). As noted above, when FSIS 

issued the proposed rule, it had 

tentatively decided that the SEC would 

be an employee of the FSIS Office of 

Field Operations (OFO) assigned to an 

FSIS District Office. Because OFO has 

expertise in management and 

enforcement of Federal inspection 

standards, FSIS is affirming that 

decision. The SEC will be an OFO 

employee assigned to an FSIS district 

office as proposed. 

As noted by the comments, the 

OPEER/FSAB is responsible for 

conducting comprehensive audits of 

Federal and State MPI programs. 

OPEER/FSAB verifies that State MPI 

programs are operating in a manner that 

is ‘‘at least equal to’’ the Federal 

program. Although OPEER/FSAB will 

not have direct oversight and 

enforcement of the cooperative 

interstate shipment program, once the 

cooperative interstate shipment program 

is fully implemented, the OPEER/FSAB 

will be responsible for auditing that 

program to verify that it is operating in 

a manner that is ‘‘the same as’’ the 

Federal inspection program. 

2. Number of SECs per State 

In the preamble to the proposed rule, 

FSIS explained that the number of 

States in an FSIS district assigned to an 

SEC will likely depend on several 

factors, including, but not limited to: (1) 

The number of States and selected 

establishments, if any, that participate 

in the cooperative interstate shipment 

program; (2) the location of each 

selected establishment; (3) the number 

of State inspection personnel providing 

inspection services to selected 

establishments in a State; (4) the 

complexity of the operations conducted 

at each selected establishment; and (5) 

the schedule of operations for each 

selected establishment (74 FR 47654). 

The preamble also noted that the 

number of States assigned to an SEC 

would also need to be based on 

consideration of the most effective 

allocation of available Agency 

resources. 

In the PRIA to the proposed rule, FSIS 

also estimated that 13 full-time 

equivalent FSIS employees would be 

needed to perform the SEC functions for 

the 16 States expected to participate in 

the cooperative interstate shipment 

program (74 FR 47660). If 400 

establishments participate in the new 

program, the Agency estimated each 

SEC will be responsible for 31 

establishments in a geographicallylimited area. 

Comment: Several comments, most 

submitted by consumer advocacy 

organizations, stated that 13 SECs to 

oversee cooperative interstate shipment 

programs in 16 States is not sufficient to 

provide adequate oversight of the new 

program. The comments urged FSIS to 

assign a separate SEC to each State that 

participates in the program. The 

comments asserted that to effectively 

verify that selected establishments 

operating in a manner consistent with 

the Acts, the SECs need to be spending 

most of their time in these 

establishments rather than driving from 

state-to-state. One comment said that 

when the provisions of the law were 

negotiated, the parties understood that 

there was to be one SEC per State. 

Other comments questioned whether 

the Agency’s estimate of one SEC for 31 

establishments is adequate to ensure 

that these establishments are operating 

in a manner that complies with the 

Acts. The comments stated that FSIS 

must provide enough flexibility to 

reduce the number of establishments 

covered by an SEC if circumstances 

warrant. 

One comment expressed concern over 

the statement in the proposed rule that 

‘‘[t]he number of States assigned to an 

SEC would also need to be based on 

consideration of the most effective 

allocation of available Agency 

resources.’’ The comment stated this 

sentence demonstrates that there is 

reason to be concerned that the new 

program may not receive adequate 

resources to best protect public health 

and safety. The comment maintained 

that there should be at minimum one 

SEC per participating State and that the 

SEC’s sole function should be oversight 

and enforcement of the program, unless 

the State has so few participating 

establishments that a full-time SEC is 

not warranted. 

Response: As noted in the preamble to 

the proposed rule, the number of SECs 

needed to provide effective oversight of 

the cooperative interstate shipment 

program will depend on several factors, 

all of which are intended to ensure that 

there is sufficient Federal oversight of 

the program. FSIS agrees with the 

comments that stated that the SECs 

should be spending most of their time 

overseeing activities in selected 

establishments, and the Agency intends 

to structure the SEC’s assignment in a 

manner that will, to the greatest extent 

possible, limit the time spent traveling 

between selected establishments. In 

some instances, this will require that an 

SEC cover selected establishments 

located in different States, particularly 

in States with selected establishments 

located near the State borders. 

As noted above, FSIS estimated that 

there would be one SEC for 31 

establishments in a geographicallylimited area. This number is an estimate 

and assumes a certain level of 

participation by State-inspected 

establishments that employed fewer 

than 35 employees when the 2008 Farm 

Bill was enacted. The actual number of 

establishments assigned to an SEC will 

depend on a number of factors, 

including the complexity of the 

operations conducted at the selected 

establishments and the schedule of 

operations for each selected 

establishment. 

3. Frequency of SEC Visits 

As required under the statute, the 

proposed regulation provided that the 

FSIS SEC is to visit each selected 

establishment in the State on a regular 

basis to verify that these establishments 

are operating in a manner that is 

consistent with the Acts and the 

implementing regulations (proposed 9 

CFR 332.7(a) and 318.517(a)). In the 

preamble to the proposed rule, FSIS 

noted that the SEC’s frequency of visits 

and oversight activities for each selected 

establishment will need to reflect the 

type of operations conducted by a 

selected establishment, as well as the 

establishment’s production processes 

(74 FR 47654). The Agency requested 

comments on how frequently the SEC 

should visit each establishment under 

his or her jurisdiction. 

Comment: Several comments said 

that, since the law requires that the 

SECs file quarterly reports on the status 

of the selected establishment under 

their jurisdiction, they should visit each 

selected establishment at least quarterly. 

Some comments stated that requiring 

that the SEC visit selected 

establishments more often than once a 

quarter would seem overly burdensome 

and ineffective. One comment suggested 

that FSIS modify the proposed 

regulation to read that the SEC will 

visit, ‘‘each selected establishment in the 

State on a regular basis, but no less 

frequently than quarterly, to verify that 

the establishment is operating in a 

manner that is consistent with the Act.’’ 

One comment stated that requiring 

quarterly or bi-annual visits will allow 

the SECs to both cover their assigned 

establishments and conduct the day-today operations of managing the program 

for their region. The comment said that 

if a problem arises, the SEC can visit the 

establishment more frequently. The 

comment suggested that SECs also rely 

on State inspection personnel to advise 

them if additional visits are needed. 


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Many comments stated that the 

frequency of the SEC’s visits should be 

based on the performance of the 

establishment. The comments noted that 

the number of visits may need to be 

higher when the program is first 

implemented while the State inspection 

personnel gain experience with the 

program’s regulatory requirements. Two 

comments suggested that initially, the 

visits should be weekly and that 

subsequent visits should be based on 

the establishment’s performance. 

One comment said that the final 

regulations should clearly state that the 

frequency of the SEC’s visits shall be 

based on the performance of the 

establishment’s food safety control 

systems. The comment maintained that 

such a statement will ensure judicious 

use of FSIS resources and create an 

additional incentive for the 

establishment to effectively operate 

their food safety control systems. 

One comment stated that the SEC 

should visit selected establishments no 

more frequently than FSIS front line 

supervisors typically visit federallyinspected establishments in their 

circuit. Another comment said that the 

SECs will need to visit selected 

establishments quite frequently to 

ensure that they are in compliance with 

Federal standards. One comment stated 

the goal in determining how frequently 

SECs should visit establishments under 

their jurisdiction should be to provide a 

statistically relevant sample to check on 

the level of compliance and 

performance of inspections by state 

inspectors. 

One comment suggested that in 

addition to prescribing the frequency of 

SEC visits, the final regulations should 

specify that the SEC’s visits to selected 

establishments are to occur at different 

times and be unannounced. 

Response: The comments submitted 

on this issue indicate that there is a 

general lack of consensus on how 

frequently the SEC should visit selected 

establishments in the States. As noted 

above, some comments suggested that 

the SEC conduct quarterly or even biannual visits, while others suggested 

that the SEC visit each selected 

establishment at least weekly. 

The 2008 amendments to the Acts do 

not specify how frequently the SECs are 

to visit selected establishments, but they 

do provide that the SEC ‘‘* * *shall 

visit selected establishments with a 

frequency that is appropriate to ensure 

that selected establishments are 

operating in a manner that is consistent 

with this Chapter (including regulations 

and policies under this Chapter (21 

U.S.C. 683(d)(3)(a) and 472(d)(3)(a)). 

The Senate Committee report that 

explains this provision states that ‘‘[i]t is 

the Committee’s intent that the [SEC] 

inspect selected establishments 

frequently each month’’ (S. Rep. No. 

110–20, 110th Cong., 1st Sess. (2007), 

pp 211–214)). 

Therefore, after considering the 

comments on this issue, as well as the 

language in both the statute and the 

Senate Committee report, FSIS has 

decided not to prescribe how frequently 

SECs are to visit selected establishments 

under their jurisdiction. Instead, the 

Agency is revising the proposed rule to 

clarify that the frequency with which 

the SEC will visit selected 

establishments under the SEC’s 

jurisdiction will be based on a number 

of factors, including the complexity of 

the operations conducted at the selected 

establishment, the establishment’s 

schedule of operations, and the 

establishment’s performance under the 

cooperative interstate shipment 

program. The Agency has concluded 

that such an approach will ensure that 

the number of SEC visits reflects the 

appropriate level of oversight needed for 

each selected establishment. 

FSIS agrees with the comments that 

noted that the number of SEC visits may 

need to be higher when the program is 

first implemented in order for the State 

personnel to gain experience in 

enforcing Federal food safety standards. 

FSIS also intends to schedule some 

unannounced SEC visits to selected 

establishments, as suggested by the 

comments. However, the SEC will also 

conduct scheduled visits to selected 

establishments to give State personnel 

the opportunity to prepare to discuss 

issues related to their role in enforcing 

Federal standards. 

Although FSIS is not prescribing a 

specific minimum number of SEC visits, 

based on the statement in the Senate 

Committee report, FSIS has concluded 

that bi-annual or quarterly visits to 

selected establishments, as suggested by 

some comments, are most likely not 

frequent enough to carry out the intent 

of the statutes. 

Comment: One comment stated that 

the provision in the proposed rule that 

allows the SEC, in consultation with the 

District Manager, to designate qualified 

FSIS personnel to visit a selected 

establishment on behalf of the SEC is an 

appropriate use of Agency resources. 

The comment said that assigning other 

designated FSIS personnel to visit 

establishments on behalf of the SEC 

makes sense from a practical and 

financial standpoint. The comment 

stated that FSIS could use inspection 

personnel who are already out in the 

field to conduct visitations to check 

compliance on a more frequent basis 

than sending the SEC into the field. 

Response: FSIS agrees that providing 

for qualified FSIS personnel to visit 

selected establishment on behalf of the 

SEC is an appropriate use of Agency 

resources. 

4. SEC Duties—Oversight 

Comment: Some comments supported 

the level of Federal oversight provided 

for in the proposed regulations as 

necessary to maintain the safety and 

security of all meat and poultry 

products distributed in interstate 

commerce. One of the comments stated 

that any cooperative interstate shipment 

program must be federally driven and 

that FSIS must be in charge. 

Other comments complained that the 

proposed rule would give the SEC an 

excessive and unnecessary level of 

Federal oversight over the cooperative 

interstate shipment program. The 

comments stated that FSIS currently 

evaluates ‘‘at least equal to’’ State MPI 

programs through reviews of State selfassessment and through an on-site 

evaluation of the State’s program every 

three years. The comments asserted that 

this evaluation methodology has proven 

effective for assuring that State 

programs are in compliance with 

Federal requirements. The comments 

said that FSIS should, to the extent 

allowed by statute, consider using this 

same method for evaluating a State’s 

performance under the new cooperative 

interstate shipment program. 

Response: FSIS disagrees with the 

comments that stated that the proposed 

rule would give the SEC an excessive 

and unnecessary level of Federal 

oversight over the cooperative interstate 

shipment program. As noted throughout 

this document, under the Acts, as 

amended by the 2008 Farm Bill, the 

FSIS Administrator is required to 

designate an FSIS employee as an SEC 

for each State to ‘‘provide oversight and 

enforcement of the program’’ and to 

‘‘oversee the training and inspection 

activities’’ of the designated State 

personnel providing inspection services 

to a selected establishment. (21 U.S.C. 

683(d)(1) and 472(d)(1)). The Acts also 

require that the SEC visit selected 

establishments as frequently as 

necessary to ensure that these 

establishments are operating in a 

manner consistent with the Federal Acts 

(21 U.S.C. 683(d)(3) and 472(d)(3)). 

Thus, the level of Federal oversight that 

the proposed rule provides for the 

cooperative interstate shipment program 

reflects the level of oversight that is 

required by law. 

FSIS disagrees with the comments 

that suggested that the Agency use 


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OPEER/FSAB’s evaluation methodology 

to oversee a State’s performance under 

the new cooperative interstate shipment 

program. As noted by the comments, the 

OPEER/FSAB conducts comprehensive 

audits of the State MPI programs to 

verify that States are enforcing laws and 

regulations that ‘‘are at least equal to’’ to 

requirements of the Federal Acts. The 

evaluation methodology used by the 

OPEER/FSAB is designed to provide a 

comprehensive annual assessment of 

the State MPI programs rather than 

continuous Federal oversight and 

enforcement of these programs. Thus, 

this methodology would not provide the 

necessary level of oversight that the 

Acts require for the cooperative 

interstate shipment program. 

Comment: Some comments expressed 

concern that the proposed rule would 

give ‘‘de facto constant regulatory 

oversight authority’’ to the FSIS SEC. 

The comments stated that this would 

basically give State personnel working 

in selected establishments two 

supervisors. According to the 

comments, this chain-of-command will 

create confusion and needless 

redundancy. 

One comment said that the SEC needs 

to work with the States to coordinate 

Federal oversight of the program to 

reduce the burden on the selected 

establishments to the extent possible. 

The comments stated that the program 

should not become one in which both 

Federal and State officials are routinely 

inspecting the same facilities. 

Another comment agreed with the 

provision in the proposed rule that 

stated that the SEC’s role is limited to 

oversight and enforcement of the 

program. The comment also agreed that 

the State program should continue to be 

responsible for the direct supervision of 

designated State personnel. 

Response: The proposed rule makes 

clear that inspection services for 

selected establishments participating in 

the cooperative interstate shipment 

program must be provided by 

designated personnel, who will be 

under the direct supervision of a State 

employee (proposed 9 CFR 332.6(b) and 

381.516(b)). Although the SEC will be 

responsible for overseeing the 

inspection activities of the designated 

personnel, the State program will 

continue to be responsible for the direct 

supervision of all designated State 

personnel. Thus, the comment that 

stated that the proposed rule would give 

State personnel working in selected 

establishments two supervisors is 

inaccurate. 

5. SEC Duties—Enforcement 

The proposed regulation gave the SEC 

the authority to initiate any appropriate 

enforcement action provided for in the 

FSIS rules of practice in 9 CFR part 500 

if the SEC determines that a selected 

establishment under his or her 

jurisdiction is operating in a manner 

that is inconsistent with the Acts 

(proposed 9 CFR 332.9(b) and 

381.189(b)). As noted in the preamble, 

such actions include regulatory control 

actions, withholding actions, and 

suspensions (74 FR 47655). 

Comment: Some comments supported 

the proposed enforcement provisions. 

One comment stated that it is 

appropriate for the SECs to have the 

same authority to initiate enforcement 

actions with respect to selected 

establishments as FSIS inspection 

personnel are authorized to do with 

federally-inspected establishment. The 

comment also supported the proposed 

requirement that selected 

establishments provide FSIS officials 

with ‘‘access to all establishment records 

required under the Act and the 

implementing regulations in this 

chapter.’’ 

Some comments said that the 

proposed rule’s enforcement provisions 

go beyond what is authorized under the 

statute and will result in duplicative 

efforts. The comments asserted that the 

designated State personnel, not the SEC, 

should be responsible for initiating 

enforcement action in selected 

establishments. 

Response: Under the proposed rule, 

designated State personnel are 

responsible for providing the necessary 

inspection services to selected 

establishments in the State. The SEC is 

responsible for verifying that the 

designated personnel are providing 

inspection services in compliance with 

the Acts. 

In the preamble to the proposed rules, 

FSIS explained that to verify that 

designated personnel are providing the 

necessary inspection services, the SEC 

for the establishment, in coordination 

with the State, will verify that the 

designated personnel are correctly 

applying Federal inspection 

methodology, making decisions based 

upon the correct application of this 

methodology, accurately documenting 

their findings, and, when authorized to 

do so, implementing enforcement 

actions in accordance with the FSIS 

Rules of Practice in 9 CFR part 500 (74 

FR 47655). Thus, the proposed rule 

makes clear that, as part of their 

inspection activities, designated State 

personnel are responsible for initiating 

enforcement actions in selected 

establishments if such personnel 

determine that an enforcement action is 

authorized under 9 CFR part 500. 

The 2008 amendments to the Acts 

provide that if the SEC determines that 

any selected establishment is in 

violation of any requirement of the Acts, 

the SEC is required to: (1) Immediately 

notify the Administrator and (2) 

‘‘deselect’’ the establishment or suspend 

inspection at the establishment (21 

U.S.C. 683(d)(3)(C) and 472(d)(3)(C)). As 

explained in the preamble to the 

proposed rule, in adopting this 

language, Congress intended that the 

SEC ‘‘* * * shall be provided all the 

tools necessary * * * to prevent or 

control any food safety issue that would 

harm human health’’ (S. Rep. No. 220, 

110th Cong., 1st Sess., at 211 (2007)). 

Therefore, to ensure that the SEC has 

the appropriate authority to address any 

food safety issues as required by the 

statutes, the proposed rule authorizes 

the SEC to initiate any appropriate 

enforcement action provided for in 9 

CFR part 500 if he or she determines 

that a selected establishment under his 

or her jurisdiction is operating in a 

manner that is inconsistent with the 

Acts or their implementing regulations. 

Thus, under the proposed rule, 

designated State personnel are 

responsible for taking appropriate 

enforcement action for violations of 

Federal food safety standards in selected 

establishments when such actions are 

authorized under 9 CFR part 500. The 

SEC covering a selected establishment is 

also authorized to take any necessary 

enforcement actions if the SEC 

identifies the need to take such action 

when conducting oversight activities at 

a selected establishment. 

Comment: One comment agreed with 

the proposed enforcement provisions 

and stated that selected establishments 

should be subject to Food Safety 

Assessments (FSAs) just as federallyinspected establishments are. The 

comment also maintained that NRs 

issued to selected establishments and 

other enforcement action should be 

made available through the Freedom of 

information Act (FOIA). 

Response: States that participate in 

the cooperative interstate shipment 

program will need to conduct 

comprehensive FSAs in order to 

properly enforce Federal food safety 

standards. As discussed in the preamble 

to the proposed rule, the SEC will also 

be authorized to conduct an FSA, or to 

request that an FSIS Enforcement, 

Investigation, and Analysis Officer 

(EIAO) conduct an FSA, if the SEC in 

consultation with the District Manager 

determines that such action would help 


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determine whether the establishment is 

operating in compliance with the Acts. 

Any records that the States and 

selected establishment are required to 

provide to FSIS to allow the Agency to 

provide the necessary oversight and 

enforcement of the cooperative 

interstate shipment program, including 

NRs issued to selected establishments, 

will be made available to the public 

through the FOIA if the records are not 

subject to an exemption under the 

FOIA. 

Comment: One comment stated that 

the final rule needs to specify an 

appeals process for non-compliances to 

ensure that all establishments that 

participate in the program understand 

the process and their rights. 

Response: The proposed rule 

provided that selected establishments 

participating in the cooperative 

interstate shipment program would be 

subject to the notification and appeal 

procedures set out in 9 CFR part 500 

(proposed 9 CFR 332.9(b) and 

381.519(b)). Thus, the proposed rule did 

provide for an appeals process for noncompliances. 

6. SEC Duties—Quarterly Reports 

As provided for in the law, the 

proposed rule provides that the SEC is 

to prepare a report on a quarterly basis 

that describes the status of each selected 

establishment under the SEC’s 

jurisdiction (proposed 9 CFR 332.8 and 

381.518). 

Comment: Some comments requested 

clarification on the type of information 

the SECs will be required to include in 

their quarterly reports. One comment 

asked whether the quarterly reports will 

include the SEC’s assessment of the 

performance of the designated State 

personnel or of the selected 

establishments. One comment stated 

that the quarterly report should include 

the SEC’s assessment of the State 

program’s performance in providing 

inspection services to selected 

establishments and not be limited to the 

performance of the designated 

personnel. 

Response: The proposed rule 

provided that the SEC quarterly report 

will: (1) Include the SEC’s assessment of 

the performance of the designated 

personnel in conducting inspection 

activities at selected establishments and 

(2) identify the selected establishments 

that the SEC has verified are in 

compliance with all Federal 

requirements, those that have been 

deselected, and those that are 

transitioning to become Federal 

establishments (proposed 9 CFR 

332.8(b) and 381.518(b). Thus, the 

quarterly report includes the SEC’s 

assessment of the performance of both 

the selected establishments and the 

designated State personnel. 

The designated personnel’s ability to 

provide inspection services to selected 

establishments in a manner that 

complies with Federal standards reflects 

the State’s ability to administer the 

cooperative interstate shipment 

program. Thus, the quarterly report will 

reflect the SEC’s assessment of the State 

program’s performance in providing 

inspection services to selected 

establishments. 

Comment: One comment asserted that 

the SEC’s do not need to visit selected 

establishments on a quarterly basis to 

complete the quarterly report. The 

comment stated that SECs will be able 

to determine the status of selected 

establishments based on routine reports 

and other documentation submitted by 

designated State personnel. Another 

comment stated that requiring an 

assessment on a quarterly basis would 

establish a burdensome Federal 

oversight process for States that 

participate in the program. 

Response: As discussed above, the 

2008 amendments to the Acts require 

that SECs visit selected establishments 

with a frequency that is appropriate to 

ensure that selected establishments are 

operating in a manner that is consistent 

with the Federal Act. There is nothing 

in the law to indicate that the SEC is to 

determine the status of selected 

establishments based on routine reports 

and other documentation submitted by 

designated State personnel, as suggested 

by the comments. 

FSIS disagrees with the comment that 

stated that requiring an assessment on a 

quarterly basis would establish a 

burdensome Federal oversight process 

for States that participate in the 

program. As noted above, the 2008 

amendments to the Acts require that the 

SECs prepare a quarterly report. 

Comment: Some comments asked 

whether the State MPI programs would 

have a role in preparing the quarterly 

reports. One comment asked whether 

the States will receive copies of the 

quarterly reports from the SECs. 

Response: The proposed rule provides 

that the SEC, in coordination with the 

State, will verify that selected 

establishments in the State are receiving 

the necessary inspection services from 

designated State personnel and that 

these establishments are eligible, and 

remain eligible, to participate in the 

cooperative interstate shipment program 

(proposed 9 CFR 332.8(b) and 

381.517(b)). Although the SEC is 

responsible for preparing the quarterly 

reports, the SEC will coordinate with 

the State to assess the status of selected 

establishments under the SEC’s 

jurisdiction. FSIS will provide the State 

copies of the SEC’s quarterly reports on 

the status of selected establishments in 

the State upon request. 

I. Deselection and Transition To Become 

Federal Establishment 

The proposed regulations provide that 

the FSIS Administrator will ‘‘deselect’’ a 

selected establishment that becomes 

ineligible to participate in the 

cooperative interstate shipment program 

(proposed 9 CFR 332.10(a) and 

381.520(a)). The preamble to the 

proposed rule explained that an 

establishment could become ineligible 

for the program for various reasons, 

such as hiring additional employees or 

for violating the Federal Acts (74 FR 

47656). The preamble also noted that 

establishments located in a State whose 

cooperative interstate shipment program 

was terminated would also be ineligible 

for the program. Consistent with the 

statute, the proposed regulations require 

that a deselected establishment be 

transitioned to become a Federal 

establishment (proposed 9 CFR 332.11 

and 381.521). 

1. Establishment Deselection 

Comment: One comment requested 

that FSIS provide more specific 

information on the circumstances in 

which an establishment will be 

deselected for non-compliance with the 

Acts. The comment asked whether a 

non-compliance report (NR) or a Notice 

of Intended Enforcement (NOIE) could 

result in deselection. According to the 

comment, NRs and NOIEs can 

sometimes be subjective depending on 

the inspection program personnel 

writing them. The comment encouraged 

FSIS and State inspection program 

directors to work with selected 

establishments that have noncompliances or enforcement actions 

against them to help those 

establishments come back into 

compliance and successfully continue 

within the program. The comment also 

asked FSIS to provide proper oversight 

and training to the SECs to ensure that 

the standards for non-compliances and 

enforcement actions are applied 

consistently across the country. 

Response: As noted above, under the 

proposed rule, the SEC is authorized to 

initiate any appropriate enforcement 

actions authorized under the Agency’s 

Rules of Practice in 9 CFR part 500, 

which include, among others, regulatory 

control actions, withholding actions, 

and suspensions (proposed 332.9(b) and 

381.189(b)). The proposed regulations 

provide that if inspection at a selected 

establishment is suspended for any of 


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the reasons specified in 9 CFR 500.3 or 

500.4, the Agency will provide an 

opportunity for the establishment to 

implement corrective actions and 

remain in the cooperative interstate 

shipment program or the Agency will 

move to deselect the establishment 

(proposed 9 CFR 332.9(c) and 

381.519(c)). 

The proposed rule provides that the 

decision to deselect a selected 

establishment under a suspension will 

be made on a case-by-case basis 

(proposed 9 CFR 332.9(d) and 

381.519(d)). The proposed rule also 

states that in making this decision the 

FSIS Administrator, in consultation 

with the State, will consider, among 

other factors: (1) The non-compliance 

that led to the suspension; (2) the 

selected establishment’s compliance 

history; and (3) the corrective actions 

proposed by the establishment 

(proposed 9 CFR 332.9(d) and 

381.519(d)). Thus, under certain 

conditions, the proposed rule does 

authorize the FSIS Administrator to 

coordinate with the States to help 

selected establishments with noncompliances come back into compliance 

and successfully continue within the 

program. 

FSIS will provide the SECs with the 

training they need to oversee and 

enforce the cooperative interstate 

shipment program in a manner that is 

consistent with the law and these 

implementing regulations. 

Comment: One comment asserted that 

the State, not the SEC, should initiate 

deselection of a selected establishment. 

The comment noted that some States 

have not incorporated 9 CFR part 500 

into their State laws or regulations. The 

comment suggested that instead of 

referencing 9 CFR part 500, the final 

regulations should give States the 

authority to take ‘‘appropriate 

enforcement action’’ against selected 

establishments when necessary. 

Response: Consistent with the law, 

under the proposed regulations, 

designated State personnel are required 

to provide inspection services in 

compliance with the Federal Acts and 

implementing regulations. Part of the 

designated personnel’s inspection 

duties involves taking appropriate 

enforcement actions when authorized to 

do so. The FSIS Rules of Practice in 9 

CFR part 500 identify the conditions 

under which inspection personnel are 

authorized to take enforcement actions 

and include the criteria for when those 

actions are warranted. Thus, unless they 

follow the procedures prescribed in the 

FSIS Rules of Practice, designated State 

personnel will be unable to properly 

enforce Federal standards in selected 

establishments. 

Because States are responsible for 

providing inspection services to 

selected establishments participating in 

the cooperative interstate shipment 

program, the States may recommend 

that an establishment be deselected 

from the program if the State determines 

that the establishment is not complying 

with the requirements of the program. 

FSIS is likely to accept the State’s 

recommendation. 

2. Deselected Establishments To Become 

Official Establishment 

Comment: Some comments supported 

the provisions in the proposed rule that 

require that establishments that become 

ineligible for the cooperative interstate 

shipment program be transitioned to 

become Federal establishments. These 

comments said that such a requirement 

is necessary to prevent establishments 

from attempting to move into and out of 

the program with no long-term 

commitment. 

Several comments stated that 

requiring that a deselected 

establishment transition to become a 

Federal establishment is a disincentive 

for establishments to participate in the 

program and could force deselected 

establishments that choose not to come 

under Federal regulation out of 

business. One comment suggested that 

instead of requiring that deselected 

establishments transition to become 

Federal establishments, FSIS should 

allow them to implement corrective 

actions and revert back to State 

inspection. 

Response: The 2008 amendments to 

the Acts authorize the Agency to 

establish a procedure to transition 

selected establishments that employ, on 

average, more than 25 employees to 

become Federal establishments (21 

U.S.C. 683(b)(3)(A) and 472(b)(3)(A)). 

The 2008 amendments also require that 

selected establishments that the 

Administrator determines to be in 

violation of any provision of the Acts be 

transitioned to become Federal 

establishments in accordance with the 

procedure developed to transition 

selected establishments that employ 

more than 25 employees (21 U.S.C. 

683(h) and 472(g)). Thus, requiring that 

deselected establishments be 

transitioned to become Federal 

establishments is necessary to 

implement the law. The law does not 

authorize FSIS to allow deselected 

establishments to revert back to the 

State MPI program without transitioning 

to become a Federal establishment, even 

if such establishments implement 

corrective actions. 

Comment: Many comments stated that 

FSIS should allow establishments that 

have been deselected and successfully 

transitioned to become Federal 

establishments to revert back to the 

State MPI program if they choose. The 

comments stated that if FSIS is 

concerned that establishments might 

find it advantageous to periodically 

switch from under one jurisdiction to 

under another, the Agency could 

establish a reasonable time period, such 

as one-year, before an establishment that 

has transitioned to become a Federal 

establishment could revert back to a 

State’s jurisdiction. One comment 

suggested that FSIS give establishments 

that have successfully transitioned to 

become Federal establishments the 

option to either revert to the State MPI 

program or be reselected for the 

cooperative interstate shipment 

program. 

Response: After considering these 

comments, FSIS has decided to amend 

the proposed regulations to allow 

establishments that were deselected 

from the cooperative interstate shipment 

and that have successfully transitioned 

to become Federal establishments to 

revert back to the cooperative State MPI 

program after operating as a Federal 

establishment for one year. 

As noted above, the 2008 

amendments to the Acts require that 

establishments that are in violation of 

the Acts be transitioned to Federal 

establishments. The amendments also 

authorize FSIS to deselect and transition 

to Federal establishments selected 

establishments that consistently employ 

more than 25 employees on average. 

However, the statutes are silent on 

whether establishments that have 

successfully transitioned to become 

Federal establishments must remain in 

the Federal program or whether they 

can later revert back to the State 

program. Therefore, FSIS has 

determined that the law does not 

prohibit such an action. 

Allowing deselected establishments 

that have successfully transitioned to 

become Federal establishments to revert 

back to the State MPI program will 

provide flexibility for establishments to 

determine which inspection system 

(Federal or State) best meets their needs. 

In addition, requiring that deselected 

establishments operate under Federal 

inspection for a year will promote food 

safety by ensuring that these 

establishments can perform in 

accordance with Federal standards 

before reverting back to the State 

program. 

The statutes provide that the 

Administrator, in coordination with the 

States, shall not select for the 


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cooperative interstate shipment 

program, an establishment that is a 

Federal establishment (21 U.S.C. 683 

(b)(2)(C)(i), 683(b)(2)(F)). Thus, FSIS 

does not believe that the law would 

allow establishments that have been 

deselected from the cooperative 

interstate shipment program and 

transitioned to become a Federal 

establishment to be re-selected for the 

program at a later date. 

3. Establishments Deselected for 

Exceeding Employee Threshold 

Comment: A few comments suggested 

that FSIS allow selected establishments 

that were deselected and transitioned to 

become Federal establishments because 

they now have more than 25 employees 

on average to revert back to the State 

MPI program at a later date if they 

reduce their average number of 

employees to fewer than 25. One of 

these comments noted that it is not 

inconceivable that a selected 

establishment could quickly exceed its 

employee-based eligibility threshold, 

forcing it to transition to an official 

Federal establishment, only to later 

discover that it does not desire to 

maintain the larger operation. The 

comment stated that in such case, the 

establishment should not be prohibited 

from reverting back to State jurisdiction 

or from participating in the cooperative 

interstate shipment program if it 

reduces its average number of 

employees to fewer than 25. 

One comment stated that selected 

establishments that have more than 25 

employees on average should be 

required to transition to become Federal 

establishments, and that once they have 

transitioned, they should not be 

permitted to revert back to the State MPI 

program. The comment stated that 

selected establishments should 

anticipate that as they grow and add 

additional employees beyond the 25 

employee limit, they will be 

transitioned to the Federal inspection 

system. The comment stated that it is 

essential that establishments not be 

permitted to ‘‘forum shop’’ for regulatory 

oversight. According to the comment, if 

establishments are meeting the 

requirements of the new program and 

are succeeding, there should be no 

reason why the establishments that 

outgrow this special program should not 

operate under Federal inspection. 

One comment asked whether an 

establishment that was deselected 

because its average number of 

employees exceeded 25 rather than for 

food safety violations will remain 

ineligible to participate in the program 

in the future. 

Response: As discussed above, FSIS 

has decided to amend the proposed rule 

to allow deselected establishments that 

have been transitioned to become 

Federal establishments to revert back to 

the State MPI program after successfully 

operating as a Federal establishment for 

one year. This amendment will apply to 

establishments that have been 

deselected for exceeding the average 

number of employees limit regardless of 

whether they reduce their average 

number of employees to fewer than 25 

or not. 

As noted above, because the law 

prohibits Federal establishments from 

being selected for the cooperative 

interstate shipment program, FSIS does 

not believe that it should permit 

establishments that have been 

deselected from the program and 

transitioned to become Federal 

establishments to be re-selected for the 

program at a later date, regardless of the 

reason for the deselection. 

Deselection and State Operations 

Comment: One comment stated that if 

the final regulations resulting from the 

proposal allow selected establishments 

to produce some products under State 

inspection and other products under the 

cooperative interstate shipment 

program, FSIS must make clear that the 

provision that requires that deselected 

establishments transition to become 

Federal establishments only applies to 

operations conducted under the 

cooperative interstate shipment 

program. The comment asserted that 

selected establishments that produce 

certain products under a State MPI 

program should be permitted to 

continue these operations without 

transitioning to become a Federal 

establishment if the establishment is 

deselected from the cooperative 

interstate shipment program. 

Response: The requirements 

associated with the cooperative 

interstate shipment program only apply 

to operations that State-inspected 

establishments conduct as part of that 

program. Thus, deselected 

establishments that conduct operations 

under both the cooperative interstate 

shipment program and the cooperative 

State MPI program will be required to 

transition the operations subject to the 

cooperative interstate shipment program 

to become a Federal establishment. 

These establishments may continue to 

produce products under the State MPI 

program if they maintain an appropriate 

separation by time or space between 

operations. 

4. Voluntary Withdrawal 

Comment: Several comments 

requested that FSIS give selected 

establishments that continue to be 

eligible for the cooperative interstate 

shipment program the option to 

voluntarily leave the program and revert 

back to operating under the State MPI 

program. The comments noted that after 

being selected for the cooperative 

interstate shipment program, some 

establishments may find that their 

businesses have changed such that they 

no longer need to ship their products 

interstate. The comments asserted that it 

makes no sense to force establishments 

that are in full compliance with the 

program’s requirements but that no 

longer need to participate in the 

program to become Federal 

establishments. 

Most of the comments that requested 

that selected establishments be 

permitted to voluntarily leave the 

cooperative interstate shipment program 

and revert back to their State MPI 

programs also said that FSIS should 

allow these establishments to re-enter 

the program at a later date. These 

comments acknowledged that the rules 

should prohibit State-inspected 

establishments from freely moving into 

and out of the program and suggested 

that the final regulations prescribe a 

waiting period that establishments that 

voluntarily leave the program must 

comply with before they may re-apply 

for the program. Most comments 

suggested a one-year waiting period, 

and one suggested a five year wait. One 

comment asked whether an 

establishment that voluntarily leaves the 

program will be allowed to re-apply for 

the program if it comes under new 

ownership at a later date. 

Response: FSIS has considered these 

comments and has concluded that it 

would not be inconsistent with the law 

to allow a selected establishment that is 

in full compliance with the cooperative 

interstate shipment program to 

voluntarily leave the program and 

operate under a State grant of 

inspection. 

The 2008 amendments to the Acts 

require that any establishment selected 

for the cooperative interstate shipment 

program that is in violation of any 

requirement of the Federal Acts be 

‘‘transitioned to a Federal 

establishment’’ (21 U.S.C. 683(h) and 

472(g)). However, the statutes do not 

address situations in which an 

establishment that is in full compliance 

with the Federal Acts elects to 

voluntarily withdraw from the program 

for business reasons, e.g., the 

establishment is in compliance with all 


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Federal standards but has been unable 

to establish a market for its products 

outside of the State. FSIS has concluded 

that allowing these establishments to 

voluntarily end their participating in the 

cooperative interstate shipment program 

will give them the flexibility they need 

to determine which inspection program 

can best meet their business needs. 

FSIS has also decided to permit 

establishments that have voluntarily left 

the cooperative interstate shipment 

program to apply for and be re-selected 

for the program at a later date. Allowing 

these establishments to be re-selected 

for the program presents little concern 

about regulatory forum shopping 

because they would be leaving the 

program for business reasons and not 

because they are having difficulty 

meeting Federal food safety standards. 

In addition, establishments that 

voluntarily withdraw from the 

cooperative interstate shipment program 

would need to re-apply through the 

State and be re-selected by the FSIS 

Administrator in coordination with the 

State in order participate in the program 

again at a later date. Both FSIS and the 

States are unlikely to select an 

establishment that has a history of 

applying for and then withdrawing from 

the program. Therefore, FSIS has 

decided that the one-year waiting period 

suggested by the comment is a 

reasonable amount of time for 

establishments that voluntarily leave the 

program to wait before they may reapply for the program. Such a policy 

will give establishments that are in full 

compliance with the program flexibility 

to re-apply for the program if, at a later 

date, they find that there may be a 

market for their products in other States. 

Comment: One comment 

recommended that FSIS distinguish 

between selected establishments that 

want to withdraw completely from the 

program, and those that want to 

withdraw temporarily and resume 

operations under the program at a later 

date. According to the comment, such a 

distinction is necessary because many 

very small establishments operate on a 

seasonal basis or part of the year. The 

comment stated that the final 

regulations should include a process in 

which entities that operate on a seasonal 

basis could apply for a temporary 

withdrawal from the program. The 

comments said that the process could be 

similar to the process used by Federal 

establishments to apply for a temporary 

withdrawal of inspection. 

One comment stated that it is not 

uncommon for very small 

establishments to operate infrequently 

or in response to local consumer 

demands. The comment noted that State 

MPI programs are generally able to offer 

a great amount of flexibility in 

providing inspection services to these 

small establishments upon request. The 

comment recommended that FSIS 

provide for this type of practice in the 

final regulations implementing the 

cooperative interstate shipment 

program. The comment also stated that 

the decision to provide infrequent or 

sporadic inspection should be the 

State’s. 

Response: As explained above, 

selected establishments that are in 

compliance with the cooperative 

interstate shipment will be permitted to 

voluntarily withdraw from the program. 

However, if these establishments want 

to resume operations as a selected 

establishment, they will need to reapply and be re-selected for the program 

by the FSIS Administrator in 

coordination with the States. 

On the other hand, selected 

establishments that operate on a 

seasonal basis may also request a 

voluntary suspension of inspection from 

the State to cover times when the 

establishment does not operate. Selected 

establishments that are granted a 

voluntary suspension will not need to 

re-apply for selection to resume 

operations under the cooperative 

interstate shipment program. As 

suggested by the comment, the decision 

to provide infrequent or sporadic 

inspection in response to a request from 

a selected establishment will be the 

State’s. 

Comment: One comment suggested 

that FSIS consider implementing an 

open enrollment period during which 

State-inspected establishments could get 

in or out of the interstate shipment 

program without penalties, so long as 

they are qualified for the program. The 

comment said that FSIS could limit the 

number of times that establishments are 

allowed to make such changes. The 

comment claimed that such a program 

would give State-inspected 

establishments the option to take 

advantage of the program when it 

worked best for their business. 

Response: The proposed regulations 

specified how State-inspected 

establishments that are interested in 

participating in the cooperative 

interstate shipment program are to 

apply for the program, and FSIS is 

amending the proposed regulations to 

allow selected establishments that are in 

compliance with the program to 

voluntarily end their participation. 

Therefore, FSIS has concluded that it is 

unnecessary to establish an open 

enrollment period in which Stateinspected establishments that qualify for 

the cooperative interstate shipment 

program could enter or withdraw from 

the program. 

The proposed regulations require that 

State-inspected establishments that are 

interested in participating in the 

cooperative interstate shipment program 

apply for the program through the State 

in which the establishment is located 

(proposed 9 CFR 332.5(a)(1) and 

381.515(a)(1)). The preamble to the 

proposed rule makes clear that States 

participating in the cooperative 

interstate shipment program will 

develop their own application 

procedures (74 FR 47653). Thus, Stateinspected establishments that are 

interested in participating in the 

cooperative interstate shipment program 

will follow their State’s application 

procedures to request that they be 

selected for the program. 

As explained above, an establishment 

that has been selected for the 

cooperative interstate shipment program 

and that is in compliance with all of the 

programs requirements may voluntarily 

end its participation at any time. Such 

establishments will be permitted to reapply for the program after a waiting 

period of one year. 

5. Termination of State’s Cooperative 

Agreement 

Comment: Several comments asserted 

that selected establishments that 

become ineligible for the cooperative 

interstate shipment program because 

their State’s agreement for the program 

was terminated should not be required 

to transition to become Federal 

establishments. Instead, the comments 

suggested that FSIS give these 

establishments the option of either 

applying for a Federal grant or reverting 

back to the State MPI program. The 

comments said that establishments that 

are deselected because the State 

agreement is terminated have no control 

over the circumstances under which 

they were deselected and, therefore, it is 

unfair to require that they become 

Federal establishments. 

A few comments asked FSIS to 

consider the impact of requiring that 

selected establishments transition to 

Federal establishments if the State’s 

agreement for a cooperative interstate 

shipment program is terminated. 

According to the comments, such a 

requirement could affect the future 

viability of some of these 

establishments. The comments said that 

it would be devastating to local markets 

if deselected establishments had to shut 

down because they are not allowed to 

revert back to the State MPI program. 

Response: The 2008 amendments to 

the Acts do not require that 

establishments that are no longer 


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eligible to participate in the cooperative 

interstate shipment program because 

they are located in a State whose 

agreement for such a program was 

terminated transition to become Federal 

establishments. Therefore, FSIS is 

amending the proposed rule to give 

these establishments the option to either 

revert back to the State MPI inspection 

program or obtain a Federal grant of 

inspection. 

If a State’s agreement for a cooperative 

interstate shipment program is 

terminated, some establishments that 

were operating under the cooperative 

interstate shipment program may be 

willing to forgo interstate shipment and 

revert back to the State MPI program 

because they prefer to receive 

inspection services from State 

personnel. Other establishments may 

prefer to continue to market their 

products interstate under a Federal 

grant of inspection. It only seems fair to 

give establishments that are in 

compliance with the requirements of the 

program, but that become ineligible 

because of a situation that is beyond 

their control, the option of transitioning 

to become a Federal establishment or 

reverting back to the State program. 

Comment: One comment stated that 

the decision to terminate a State’s 

agreement for a cooperative interstate 

shipment program should not be taken 

lightly or without considering 

circumstances unique to the State and 

its selected establishments. The 

comment suggested that FSIS revise the 

provision in proposed rule that states: 

‘‘If the State fails to develop a corrective 

action plan, or the selected 

establishment coordinator for the State 

determines that the corrective action 

plan is inadequate, the Administrator 

will terminate the agreement for the 

cooperative interstate shipment program 

***’’ to change ‘‘will’’ to ‘‘may.’’ The 

comment stated that this revision will 

provide an appropriate degree of 

flexibility for the Administrator in 

deciding whether to terminate an 

agreement for a cooperative interstate 

shipment program. 

Response: The proposed regulation 

provides that if the SEC determines that 

designated State personnel are 

providing inspection services to 

selected establishments in the State in a 

manner that is inconsistent with the 

Federal Acts and implementing 

regulations, the Administrator will 

provide an opportunity for the State to 

develop and implement a corrective 

action plan to address inspection 

deficiencies identified by the SEC 

(proposed 9 CFR 332.7(c) and 

381.517(c)). The SEC will advise the 

State on the issues that the State needs 

to address to ensure that the corrective 

action plan adequately addresses the 

deficiencies identified by the SEC. 

However, if the State fails to develop a 

corrective action plan that adequately 

addresses the issues identified by the 

SEC, FSIS believes that the 

Administrator has no choice but to 

terminate the cooperative agreement. 

Therefore, the Agency is not changing 

‘‘will’’ terminate the agreement to ‘‘may’’ 

terminate the agreement, as suggested 

by the comment. 

7. Transition Procedures 

Comment: The proposed regulations 

provide that if a selected establishment 

is deselected, FSIS will coordinate with 

the State where the establishment is 

located to develop and implement a 

plan to transition the establishment to 

become an official establishment. One 

comment stated that FSIS needs to 

clearly state the procedures needed to 

transition a selected establishment to 

become a Federal establishment to 

ensure that all States and establishments 

that are interested in participating in the 

program agreement fully understand all 

of the requirements and potential 

consequences of deselection. 

Response: The 2008 amendments to 

the Acts authorize FSIS to develop a 

procedure to transition selected 

establishments to become Federal 

establishments if they employ more 

than 25 employees on average, or if the 

Administrator determines that they are 

in violation of any provision of the Acts 

(21 U.C.S. 683(b), 683(h), 472(b) and 

472(h)). In the preamble to the proposed 

rule, the Agency explained that it was 

not prescribing specific procedures to 

transition selected establishments to 

become official establishments because 

the actions needed to successfully make 

such a transition are likely to depend on 

the reason the establishment was 

deselected (74 FR 47656). As an 

example, FSIS noted that an 

establishment that was deselected for 

violating the Acts would likely need to 

develop a corrective action plan to 

transition to an official establishment, 

while an establishment that was 

deselected for hiring additional 

employees would not. 

Therefore, consistent with the 

proposal, FSIS has decided to not 

prescribe specific procedures to 

transition selected establishments to 

become Federal establishments, as 

suggested by the comment. As was 

proposed, if a selected establishment is 

deselected from the cooperative 

interstate shipment program, FSIS will 

coordinate with the State where the 

establishment is located to develop and 

implement a plan to transition the 

establishment. As noted in the 

preamble, at a minimum, such a plan 

will include: (1) Adding the 

establishment to an FSIS circuit; (2) 

replacing the establishment’s State 

establishment number with a Federal 

number; and (3) replacing the 

designated personnel with FSIS 

personnel. 

Comment: One comment noted that in 

the proposed rule FSIS outlined some 

general procedures that would be 

necessary to transition a selected 

establishment to become a Federal 

establishment (e.g., changing the 

establishment number and replacing 

state personnel with FSIS inspection 

personnel) but that the Agency also 

explained it would collaborate with the 

States to implement specific transition 

procedures on a case-by-case basis. The 

comments stated that while this 

approach may be appropriate in dealing 

with individual establishments in a 

State, FSIS should develop specific 

procedures for instances when the 

State’s agreement for a cooperative 

interstate shipment program is 

terminated. 

Response: As discussed above, under 

this final rule, establishments that are 

no longer eligible to participate in a 

cooperative interstate shipment because 

they are located in a State whose 

agreement for such a program was 

terminated will have the option to either 

revert back to the State MPI inspection 

program or obtain a Federal grant of 

inspection. Selected establishments that 

choose to operate under Federal 

inspection will need to transition to 

become a Federal establishment. FSIS 

will coordinate with the State where the 

establishment is located to develop and 

implement a plan for the establishment 

to obtain a Federal grant of inspection. 

Selected establishments that choose to 

revert to the State MPI program will 

need to obtain a State grant of 

inspection through the State in which 

they are located. 

J. Federal Contribution, Technical 

Assistance, and Transition Grants 

1. Federal Contribution 60% State Costs 

As noted in the preamble to the 

proposed rule, the statute requires that 

the Federal contribution for inspection 

services provided by States that enter 

into an agreement for a cooperative 

interstate shipment program be at least 

60% of eligible State costs. In the 

preamble, FSIS also explained that the 

Agency had tentatively concluded that 

eligible State costs are those costs that 

a State has justified and FSIS has 

approved as necessary for the State to 

provide inspection services to selected 


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establishments in the State (74 FR 

47650). The Agency requested 

comments on whether it should codify 

this definition or any other 

requirements related to State 

reimbursement for eligible costs in the 

final rule. 

Comment: Comments submitted by 

both State Departments of Agriculture 

and consumer advocacy organizations 

stated that FSIS should codify 

requirements related to reimbursement 

of States for at least 60% of their eligible 

costs associated with the cooperative 

interstate shipment program. According 

to some comments, codifying these 

requirements would provide both States 

and FSIS personnel with consistent 

guidance on the level of reimbursement 

and requirements for receiving payment 

under the program. The comments also 

said that codifying the reimbursement 

requirements will prevent ad hoc 

interpretations and inequitable 

reimbursement policies over time. 

Some comments requested that FSIS 

more clearly define ‘‘eligible costs.’’ The 

comments specifically asked whether 

the following State costs would be 

considered eligible costs under the final 

rule: (1) Federal Indirect Cost 

Reimbursement to pay for office and 

administrative support services; (2) rent 

for computers, (3) administrative offices 

and field staff offices; and (4) fees 

associated with information technology 

and laboratory services. 

One comment supported the proposed 

definition of eligible State costs as those 

direct costs that a State has justified and 

FSIS has approved as necessary for the 

State to provide inspection services to 

selected establishments in the State. The 

comment argued that these are Federal 

taxpayer dollars that should be spent on 

Federal programs. The commenter 

stated that it understands that the law 

requires FSIS to reimburse States not 

less than 60% of eligible State costs but, 

according to the comment, such 

reimbursement should be confined to 

direct costs only. The comment asserted 

that costs that fall under Federal 

Indirect Cost Reimbursement definitions 

should not be included. 

Response: To be reimbursed for 60% 

of their eligible costs to administer the 

cooperative interstate shipment 

program, States will need to follow the 

same financial accountability and 

budget submission requirements needed 

to receive the maximum 50% Federal 

reimbursement under the cooperative 

State MPI program. These requirements 

include, but are not limited to, the 

administrative rules for Federal grants 

and cooperative agreements prescribed 

in USDA’s Uniform Administrative 

Requirements for Grants and 

Cooperative Agreements to State and 

Local Governments regulations (7 CFR 

part 3016), as well as the principles 

provided in the Office of Management 

and Budget’s (OMB) circular A–87 ‘‘Cost 

Principles for State, Local, and Indian 

and Tribal Governments’’ (2 CFR Part 

225); OMB circular A–102, ‘‘Grants and 

Cooperative Agreements with State and 

Local Governments’’; and OMB circular 

A–133, ‘‘Audits of States, Local 

Governments, and Non-Profit 

Organizations’’. 

FSIS will only reimburse 60% of a 

State’s costs to administer the 

cooperative interstate shipment program 

if the State can justify that the costs are 

necessary to provide inspection services 

to selected establishments in the State 

and that the costs are allowable under 

the applicable Federal cost principles or 

other terms and conditions of the 

cooperative agreement. To make this 

clear, FSIS is codifying the definition of 

eligible State costs that it had tentatively 

decided on in the proposed rule. Thus, 

9 CFR 321.3 and 381.187 of this final 

rule provide that for purposes of the 

cooperative interstate shipment 

program, eligible State costs are those 

costs that a State has justified and FSIS 

has approved as necessary for the State 

to provide inspection services to 

selected establishments in the State. 

The Federal requirements and 

procedures for the financial 

administration and operation of 

cooperative State agreements are 

described in FSIS Directive 3300.1 

‘‘Fiscal Guidance for Cooperative 

Inspection Programs’’. These 

requirements and procedures apply to 

all cooperative inspection program 

agreements, including agreements for 

the cooperative interstate shipment 

program. FSIS will update directive 

3300.1 to specifically address the 

cooperative interstate shipment 

program. 

Comment: One comment asked 

whether a State’s administrative costs to 

begin an interstate shipment program 

will be eligible for at least 60% 

reimbursement from FSIS. The 

comment also asked whether there is 

anything in the program that would 

prohibit a State from charging an 

establishment a fee to participate in the 

program to help cover the State’s 

additional costs. Another comment 

asked whether the final rule will require 

that States submit separate financial 

reports for inspection costs associated 

with the State MPI program and for 

costs associated with the cooperative 

interstate shipment program. 

Response: As noted above, FSIS will 

only reimburse 60% of a State’s costs to 

administer the cooperative interstate 

shipment, including the administrative 

costs to begin the program, if the State 

can justify that the costs are necessary 

to provide inspection services to 

selected establishments in the State and 

that the costs are allowable under the 

applicable Federal cost principles or 

other terms and conditions of the 

cooperative agreement. The 2008 

amendments to the Acts are silent on 

whether a State may charge an 

establishment a fee to participate in the 

cooperative interstate shipment 

program. The proposed rule provides 

that States are responsible for 

developing their own procedures for 

establishments to apply to be selected 

for the cooperative interstate shipment 

program. 

The agreement between FSIS and a 

State for a cooperative interstate 

shipment program is separate from the 

cooperative State MPI agreement. 

Therefore, States that participate in the 

cooperative interstate shipment program 

will be required to submit separate 

financial reports for inspection costs 

associated with the State MPI program 

and for costs associated with the 

cooperative interstate shipment 

program. The States must also clearly 

document the time and cost that they 

spent to provide administrative support 

for the State MPI program versus the 

time and cost needed to provide 

administrative support for the 

cooperative interstate shipment 

program. 

Comment: Some comments supported 

the requirement that Federal 

reimbursement for the cooperative 

interstate shipment program be in an 

amount of not less than 60% of eligible 

State costs. The comments urged FSIS to 

provide more funding if, and when, the 

budget allows. 

One comment stated that in order for 

the program to succeed, it is critically 

important for FSIS, the Obama 

Administration, and Congress to commit 

sufficient resources to carry out the 

program. The comment stated that 

under no circumstances should FSIS be 

required to absorb these resources from 

its existing budget. 

One comment stated that the higher 

the Federal contribution, the more likely 

it is that State programs will be able to 

participate in the interstate shipment 

program. The comment encouraged 

FSIS to be creative in finding ways to 

increase the Federal contribution to the 

program. The comment noted that cash 

infusions are the best way to support the 

program, but that other contributions, 

such as equipment (including 

computers discussed above) and 

services (including training and 


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laboratory services), would also be 

helpful. 

Response: FSIS agrees that the success 

of the cooperative interstate shipment 

program will depend on the level of 

funding that Congress provides for the 

Agency to administer the program. 

2. Technical Assistance and Outreach 

As required by the statute, FSIS 

established the Office of Outreach 

Employee Education and Training 

(OOEET) to provide ‘‘outreach, 

education, and training to certain small 

and very small establishments’’ and to 

provide ‘‘grants to States to provide 

outreach, technical assistance, 

education, and training to certain small 

and very small establishments’’ (21 

U.S.C. 683(f)). 

In the preamble to the proposed rule, 

FSIS explains that the Agency fulfilled 

this requirement by establishing the 

Office of Outreach Employee Education 

and Training (OOEET). OOEET is 

responsible for directing outreach, 

education, and training programs for 

FSIS to ensure public health and food 

safety through both inspection and 

enforcement activities. FSIS received 

several comments and suggestions on 

how OOEET should provide outreach 

and technical assistance to support the 

cooperative interstate shipment 

program. FSIS has included a general 

description of these comments below. 

However, OOEET’s outreach and 

assistance activities were not 

specifically addressed in the proposed 

rule. Thus, these comments are outside 

the scope of this rulemaking. 

Comment: Some comments 

encouraged OOEET to work with other 

Federal agencies to assist establishments 

that are interested in participating in the 

cooperative interstate shipment program 

to acquire grants or loans to fund 

modifications that they may need to 

make to their facilities in order to 

comply with Federal standards. The 

comments noted that in the preamble to 

the proposed rule, FSIS estimated that 

establishments that need to make 

structural modifications or perform new 

construction could incur costs in the 

range of $15,000 to $30,000. The 

comments said that the States should 

not be expected to fund these costs. 

A few comments suggested that FSIS 

use USDA’s ‘‘Know Your Farmer, Know 

Your Food’’ initiative to provide 

information about USDA grant and loan 

programs to help small and very small 

facilities upgrade their infrastructure. 

The consumer advocacy organization 

Food and Water Watch submitted 

identical comment letters on behalf of 

5,083 private citizens. The comment 

letters supported FSIS’s proposed 

regulation implementing the 

cooperative interstate shipment 

program. The comments also suggested 

that FSIS take a number of actions to 

ensure that the change to the new 

program goes smoothly and is feasible 

for States and small establishments. 

Three comments reference a report 

issued by Food and Water Watch 

entitled ‘‘Where’s the Local Beef?’’ The 

comments stated that the report 

provides a number of recommendations 

that FSIS should consider for the 

technical assistance required under the 

statute. The comments encouraged FSIS 

to consider these recommendations. 

One comment stated that to ensure 

that States and establishments receive 

the assistance that they need to 

participate in the program, the 

Administration must budget, and 

Congress must appropriate, adequate 

funding for outreach and training 

activities. The comment said that, in 

particular, OOEET will need sufficient 

resources to conduct workshops, 

training sessions, and other activities to 

ensure that small and very small 

establishments in the new program 

understand the requirements they are 

expected to meet. 

Response: As noted above, the issues 

raised by these comments are outside 

the scope of this rulemaking. However, 

the Agency will take them into 

consideration when it implements this 

final rule. 

3. Transition Grants 

Under the statute, FSIS is authorized 

to provide ‘‘transition grants’’ to States to 

assist the States in helping Stateinspected establishments transition to 

selected establishments (21 U.S.C. 

683(g) and 472(f)). In the proposed rule, 

FSIS explained that it has tentatively 

decided to define transition grants as 

funds that a State participating in a 

cooperative interstate shipment program 

must use to reimburse selected 

establishments in the State for the cost 

to train one individual in individual in 

HACCP requirements for meat and 

poultry products and associated training 

in the development of Sanitation SOPs. 

FSIS received several comments on 

the proposed definition of transition 

grants. 

Comment: Some comments supported 

FSIS’ tentative conclusion to use its 

transition grant authority to reimburse 

States for the costs of HACCP training 

for establishment employees as an 

appropriate use of these funds. 

According to one comment, FSIS has 

already created a division to provide 

technical assistance for small and very 

small establishments, i.e., OOEET, so it 

is not necessary to provide transition 

grants to the States to use for 

duplicative outreach services. 

Other comments said that the 

proposed transition grant definition is 

too narrow, unnecessarily restrictive, 

and does not reflect the fact that training 

may be more urgently needed in other 

areas essential to food safety, such as 

microbiological sampling, process 

control, validation, determination of 

HACCP Critical Limits, or use of 

modern monitoring techniques. The 

comments suggested that FSIS revise the 

definition to allow the funds to be used 

to provide outreach, technical 

assistance, education, and training that 

establishments may need to become 

selected establishments and maintain 

this designation. 

Other comments stated that while 

HACCP training is an appropriate use of 

transition grants, it should not be the 

only use permitted for these funds. The 

comments asserted that transition grants 

could be used in some States for 

relevant state and local agencies to 

convene workshops and listening 

sessions on the application of local, 

State and Federal food safety regulations 

on small and very small processing 

establishments. The comments asserted 

that these workshops could generate 

approaches to improve and streamline 

food safety regulations, including 

HACCP requirements, to ensure that 

they are appropriate for achieving food 

safety standards in smaller facilities. 

A few comments stated that FSIS 

should permit transition grant funds to 

be used for tangible items, such as 

facility upgrades or other one-time start 

up costs for establishments to become 

eligible for the cooperative interstate 

shipment program. One comment said 

that, if necessary FSIS could limit the 

amount it would provide to States to 

reimburse selected establishments to 

$5,000 per establishment, which was 

the Agency’s estimated cost to train an 

individual in HACCP. 

Two comments submitted by animal 

welfare advocacy organizations stated 

that, in addition to HACCP training, 

FSIS should also allow States to use 

transitions grant funds to reimburse 

selected establishments for their costs to 

train personnel in humane handling and 

humane slaughter. 

Response: The comments indicate 

that there is a general lack of consensus 

on the appropriate use of transition 

grant funds. Therefore, because the 

comments offered no compelling reason 

to change it, FSIS is adopting the 

proposed definition of transition grant 

as funds that a State participating in a 

cooperative interstate shipment program 

must use to reimburse selected 

establishments in the State for the cost 


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to train one individual in HACCP 

requirements for meat and poultry 

products and associated training in the 

development of Sanitation SOPs. 

FSIS has very limited authority for 

and experience in administering grants 

for financial assistance outside the 

scope of cooperative inspection 

programs, and its food safety focus 

suggests that it would be of limited 

value for the Agency to gain such 

experience. Other USDA agencies, such 

as Rural Development and the National 

Institute for Food and Agriculture 

provide loans and grants of the kind that 

might be useful for establishments that 

may need to make modifications to their 

facilities to become eligible for the 

cooperative interstate shipment 

program. FSIS will coordinate with 

these other USDA agencies in 

developing and publicizing such 

programs, but will defer to them as 

USDA’s loan and grant program 

specialists. 

A limited grants program to provide 

Federal funds to States so that they may 

reimburse selected establishments for 

HACCP training is, however, consistent 

with FSIS’s authorities and capabilities. 

It will help to ensure that 

establishments that participate in the 

cooperative interstate shipment program 

are able to comply with Federal food 

safety standards. Limiting the use of 

transition grants to HACCP training for 

one individual will ensure that the costs 

associated with these grants are limited, 

predictable, and simple to monitor. 

Comment: One comment requested 

that FSIS provide more details on the 

transition grants. The comment noted 

that while funds from transition grants 

will be available to help establishments 

with the costs of training on HACCP and 

SSOPs, some establishments are likely 

to have already completed the necessary 

HACCP training. For those 

establishments, the comment asked 

whether States could use transition 

grant funds to reimburse the 

establishment’s costs to send an 

employee to advanced HACCP training 

courses or to send another employee for 

training in basic HACCP and SSOPs. 

The comment also asked if the grant 

includes all costs associated with the 

training, from travel costs to the cost of 

registration or materials. 

Response: The proposed rule requires 

that States use transition grant funds to 

reimburse selected establishments for 

their costs to train one individual in 

HACCP requirements for meat and 

poultry products as required under 9 

CFR 417.7 of the HACCP regulations 

and associated training in the 

development of Sanitation SOPs. These 

regulations require that the individual 

successfully complete a course of 

instruction in the application of the 

seven HACCP principles to meat or 

poultry product processing. Thus, 

transition grant funds may be used to 

reimburse the costs associated with the 

basic training required to comply with 

9 CFR 417.7, which does not include 

advanced HACCP training. The 

transition grant would include any costs 

that the establishment can demonstrate 

were necessary to provide HACCP 

training to one individual. 

K. Potential Benefits 

FSIS received several comments on 

the potential benefits of allowing small 

and very small State-inspected 

establishments to ship meat and poultry 

products in interstate commerce. 

Following is a general description of 

these comments categorized by potential 

benefit. 

1. Expand Markets for Small 

Establishments 

Several comments said that allowing 

State-inspected products to ship meat 

and poultry products interstate will 

benefit small and very small Stateinspected establishment by providing 

new markets for their products. The 

comments also stated that, as small 

processors expand their markets, 

consumers will also benefit from an 

increase in product choice. 

2. Rural Development 

Some comments stated that, if 

implemented correctly, the cooperative 

interstate shipment program will 

provide opportunities for rural 

development. One comment said that a 

workable cooperative interstate 

shipment program will stimulate small 

business sales, expand rural 

development and jobs, and increase 

local tax bases, strengthening the 

stability of rural communities. Another 

comment noted that increasing the 

market opportunities for small 

processors is important to rural 

development because it will help to 

maintain and increase jobs in the rural 

areas where many of these small 

processors are located. 

3. Small Farmers and Livestock 

Producers 

Several comments stated that 

allowing State-inspected processing 

plants to ship products interstate will 

benefit small farmers and local livestock 

and poultry producers by providing 

them with access to processing plants 

that can sell meat and poultry products 

across State lines. The comments noted 

that farmers rely on processing plants to 

sell their products to consumers, and 

that allowing interstate shipment of 

State-inspected products will help 

family farmers raising livestock and 

poultry, as well as small processing 

plants, to increase their access to larger 

markets. 

One commenter had conducted a 

survey of farmers across the country in 

spring 2009 to identify barriers to local 

food marketing. The comment noted 

that by far, the number one barrier 

mentioned was access to processing 

plants for meat, poultry, and valueadded crops. 

Several comments said that, in 

addition to expanding markets for local 

livestock and poultry producers, 

allowing small State-inspected 

processing plants to ship products 

interstate will also benefit these local 

producers by reducing travel costs that 

many must incur to send their livestock 

to a federally-inspected establishment. 

One comment said that a producer in 

central Wyoming estimated that he 

could save almost $220,000 per year if 

he could have his animals processed 

locally in a state-inspected 

establishment. Some comments noted 

that many small livestock and poultry 

producers prefer to have their products 

processed in small State-inspected 

establishments, but that for some of 

these producers, the closest small 

processing establishment may be 

located across State lines. 

Some comments stated that the 

cooperative interstate shipment program 

could benefit cattle producers by 

increasing the demand for beef. The 

comment said that allowing stateinspected establishments to ship 

interstate will provide many smaller 

packing plants with an opportunity to 

expand into new markets. According to 

the comment, growth and new 

opportunities for these smaller plants 

means that they will have the 

opportunity to buy more cattle from 

producers. The comment asserted that 

this further demand for cattle will 

provide more competition in the market 

and will potentially provide more 

opportunities for cattlemen. 

One comment stated that the 

increased market opportunities for small 

processors will be passed on to livestock 

and poultry producers, which will lead 

to increased on-farm revenues. 

A few comments stated that the 

proposed cooperative interstate 

shipment program will offer 

independent family farmers and niche 

producers whose operations use 

humane and sustainable animal 

agricultural practices greater 

opportunity to market their products to 

a broader range of consumers. One 

comment believed that the proposed 


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rule has the potential to benefit small 

organic livestock operations. According 

to the comment, it is often difficult for 

these producers to find local slaughter 

or processing facilities. 

One comment stated that the 

proposed interstate shipment program 

has the potential to benefit not only 

family farmers but the animals they 

raise by reducing the stress associated 

with long transport times to slaughter. 

Some comments stated that the 

proposed rule will enhance the USDA’s 

‘‘Know Your Farmer, Know Your Food’’ 

initiative by helping to break down 

structural barriers that have inhibited 

local food systems from thriving. 

4. Protect Public Health 

One comment stated that the 

proposed program will protect public 

health by facilitating traceback of Stateinspected products that may be the 

subject of a recall. 

Response: FSIS agrees that these 

comments all identify potential benefits 

associated with the cooperative 

interstate shipment program. 

L. Interstate Shipment and Humane 

Handling of Livestock 

Comment: A few comments noted that 

the proposed rule did not mention the 

Federal Humane Methods of Slaughter 

Act (HMSA). One comment stated that, 

while the FMIA incorporates the HMSA 

by reference, it is imperative that FSIS 

make clear in the final rule’s codified 

text that establishments must be in 

compliance with the HMSA and all 

State humane handling requirements to 

be eligible for the cooperative interstate 

shipment program. 

One comment stated that in May 

2008, the commenter published a report 

on the enforcement of humane slaughter 

laws in the United States. The comment 

explained that the report included 

results from a series of public records 

requests that the commenter made to the 

30 States accredited to administer the 

Federal humane slaughter laws (the 27 

States with cooperative agreements for 

State MPI programs and 3 States with 

cooperative programs for custom 

plants). 

Based on this report, the comment 

concluded that most states that operate 

meat inspection programs are not 

enforcing the HMSA at state-inspected 

establishments. The comment said that 

small state-inspected establishments are 

probably less likely to have staff and 

management with training in humane 

handling and slaughter as Federal 

establishments, and that small stateinspected establishments are also 

probably less likely to have specialized 

equipment for proper animal handling 

or a facility design that promotes 

humane handling and slaughter. 

Response: To qualify for the 

cooperative interstate shipment 

program, establishments will need to 

comply with, and States will need to 

enforce, standards that are ‘‘the same as’’ 

those imposed under the Federal Acts 

and implementing regulations. As noted 

by the comments, the FMIA 

incorporates the HMSA by reference. 

Therefore, selected establishments must 

comply with, and participating States 

must enforce, humane handling 

procedures that are ‘‘the same as’’ those 

imposed under the HMSA and FSIS’s 

implementing regulations. 

Because the FMIA incorporates the 

HMSA, it is not necessary to include 

additional requirements to implement 

the HMSA in the regulations 

implementing the cooperative interstate 

shipment program. 

Comment: One comment suggested 

that as part of its outreach efforts to 

small and very small establishments, 

FSIS include training in the humane 

handling of livestock and poultry during 

slaughter and processing. One comment 

suggested that FSIS grade and identify 

establishments based on how humanely 

they raise their livestock. 

Response: These comments are 

outside the scope of the proposed rule. 

M. Miscellaneous Comments 

Comment: A few comments noted that 

many small and very small 

establishments process bison, elk, and 

other species that are not amenable to 

the Federal Acts. The comments asked 

whether FSIS would address the 

processing of these species in the final 

rule implementing the cooperative 

interstate shipment program. One 

comment asked whether the final 

regulations will permit selected 

establishments to continue to slaughter 

non-amenable species under the State 

inspection program. The comment also 

asked whether the ‘‘same as’’ standard 

proposed for the cooperative interstate 

shipment program will affect Stateinspected operations related to nonamenable species. 

Response: The cooperative interstate 

shipment program does not cover 

operations for the processing of bison, 

elk, and other species that are not 

amenable to the FMIA or PPIA. 

However, as discussed above, this final 

rule will allow State-inspected 

establishments to operate under both 

the State MPI program and the 

cooperative interstate shipment 

program. Under this final rule, selected 

establishments may continue to 

slaughter and process non-amenable 

species under the State inspection 

program as long as they maintain an 

appropriate separation of time or space 

between these operations and the 

operations conducted under the 

cooperative interstate shipment 

program. Because operations associated 

with non-amenable species are not 

eligible for the cooperative interstate 

shipment program, these operations are 

not affected by the ‘‘same as’’ standard 

required for the program. 

Comment: One comment stated that 

FSIS must make clear in the final rule 

that state-inspected horse slaughter 

facilities are not eligible to participate in 

the new cooperative interstate shipment 

program. The comment noted that 

currently there are no such facilities in 

operation in the United States, but 

expressed concern that providing 

certain state-inspected establishments 

access to the interstate market may 

encourage some small establishments to 

initiate new horse slaughter operations. 

The comment stated that Congress has 

made its intent clear that Federal 

funding must not be used to inspect 

such facilities, and FSIS must not allow 

establishments to use the cooperative 

interstate shipment program to 

circumvent the law. 

The comment also stated that any 

attempt by FSIS to regulate horse 

slaughter facilities must comply with 

the National Environmental Policy Act, 

42 U.S.C. 4231 et seq., and cited 

Humane Society of the United States v. 

Johanns (520 F.Supp.2d 8 (D.D.C. 2007)) 

to support this statement. The comment 

asserted that unless FSIS makes clear 

that the final rule does not encompass 

horse slaughter, the Agency will need to 

prepare an Environmental Impact 

Statement or Environmental Assessment 

before finalizing the rule to avoid a 

potential violation of a federal court 

order. 

Response: As noted by the comment, 

the FY 2010 Agriculture, Rural 

Development, Food and Drug 

Administration, and Related Agencies 

Appropriations Act prohibits the use of 

appropriated funds and user fees to pay 

the salaries of expenses of personnel to 

inspect horses prior to slaughter for 

human food (Pub. L. 111–80, § 739). 

FSIS will comply with these and any 

future restrictions on the use of 

appropriated funds as it implements the 

cooperative interstate shipment 

program. 

Comment: One comment suggested 

that, when developing the final rule to 

implement the cooperative interstate 

shipment program, FSIS should review 

its data on FSAs, NRs, suspensions, 

HACCP deviations, number of lab tests, 

and laboratory results to compare FSIS 

regulatory oversight of very small StateVerDate Mar<15>2010 18:58 Apr 29, 2011 Jkt 223001 PO 00000 Frm 00032 Fmt 4701 Sfmt 4700 E:\FR\FM\02MYR3.SGM 02MYR3

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Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 24745 

3These four States have each signed an agreement 

with the Agency to conduct a comparative analysis 

to determine what the States would need to do to 

meet the ‘‘same as’’ requirements for the cooperative 

interstate shipment program. FSIS provided funds 

for the States to conduct the assessment. 

inspected establishments with large and 

small establishments. According to the 

comment, this information may help 

identify specific areas of concern that 

the Agency should address in the final 

rule. 

Response: FSIS believes that this final 

rule provides the appropriate level of 

Federal oversight required under the 

2008 amendments to the Acts. The data 

identified by the comment will be 

useful to FSIS in overseeing the 

program. 

Comment: One comment asked 

whether the labels for products 

produced in establishments selected to 

participate in the cooperative interstate 

shipment program will be granted 

expedited review so that they can begin 

to operate under the new program more 

quickly. The comment also asked 

whether such labels would be approved 

by the FSIS Labeling and Program 

Delivery Division (LPDD). The comment 

stated that it would be disappointing if 

an establishment’s ability to participate 

in the cooperative interstate shipment 

program was delayed because of the 

label approval process. 

Response: The labels of meat and 

poultry products produced under the 

cooperative interstate shipment program 

will be subject to FSIS’ prior label 

approval system to ensure that such 

labels comply with Federal labeling 

requirements. The SEC for the State 

where a selected establishment is 

located will coordinate with the State to 

facilitate the label submission process. 

The SEC will also verify that the labels 

applied to meat and poultry products 

produced under the cooperative 

interstate shipment program have been 

evaluated and approved by LPDD, 

except for generically approved labeling 

authorized for use in Title 9 of the Code 

of Federal Regulations (CFR), §§ 317.5 

and 381.133. Because the labels of meat 

and poultry products produced in 

selected establishments are required to 

bear a Federal mark, it is essential that 

these labels comply with all Federal 

labeling requirements. 

Comment: One comment requested 

that FSIS explain whether, under the 

final rule, E. coli O157:H7 would be 

considered an adulterant if detected on 

an intact muscle cut of beef. The 

comment asserted that if E. coli 

O157:H7 is only considered an 

adulterant if it is detected in a ground 

beef sample, selected establishments 

whose operations are limited to further 

processing will be subject to 

enforcement action, i.e., deselection, for 

upstream contamination over which 

they have no control. 

Two comments suggested that in the 

final rule, FSIS add a provision to 

ensure that selected establishments 

whose operations are limited to further 

processing are not subject to 

enforcement actions for product 

contamination that originated in an 

upstream slaughter facility. 

Response: These comments address 

issues associated with FSIS’s existing 

policies with respect to E. coli O157:H7. 

They are outside the scope of this 

rulemaking. 

Comment: One comment stated that 

processors and regulatory staff have 

been trained to recognize ‘‘shall’’ as an 

indication of mandatory requirements. 

The comment inserted suggested 

revisions to the proposed codified text, 

such as replacing ‘‘will’’ with ‘‘shall.’’ 

According to the comment, the 

suggested revisions are needed to make 

clear which provisions of the 

regulations are mandatory. 

Response: This is the only comment 

to make these suggested revisions. FSIS 

believes that the language in the 

codified text clearly articulates the 

requirements associated with the 

cooperative interstate shipment 

program. 

Comment: One comment noted that 

throughout the proposed regulations 

FSIS uses the terms such as ‘‘in 

compliance with the Acts’’ or 

‘‘consistent with the Acts.’’ The 

comment stated that since State meat 

and poultry inspection programs 

already comply with the FMIA and 

PPIA, FSIS needs to make clear that 

most references to ‘‘the Act’’ in the 

proposed regulation are intended to 

refer to the new legislation, i. e., Title 

V of these Acts. According to the 

comment, Section 11015 of the 2008 

Farm Bill did not amend the existing 

sections of FMIA and PPIA, but rather 

created a new section in each of these 

Acts. The comment suggested that FSIS 

revise ‘‘in compliance with the Acts’’ to 

‘‘in compliance with this Act’’ to make 

this clear. 

Response: In the final codified text, 

‘‘this Act’’ was changed to ‘‘this chapter.’’ 

As used in the statutes, ‘‘this chapter’’ 

means the FMIA and PPIA, not section 

11015 of the 2008 Farm Bill (see 21 

U.S.C.A. 683 and 472, Historical and 

Statutory Notes, References in Text). 

Thus, the terms ‘‘in compliance with the 

Acts’’ or ‘‘consistent with the Acts’’ 

better reflect the intent of the statutes 

than ‘‘in compliance with this Act’’ 

meaning section 11015 of the 2008 Farm 

Bill. 

Executive Order 12866 and Regulatory 

Flexibility Act 

This final rule has been reviewed 

under Executive Order 12866. It has 

been determined to be significant, but 

not economically significant for 

purposes of E.O. 12866 and, therefore, 

has been reviewed by the Office of 

Management and Budget (OMB). 

Currently, 27 States administer 

cooperative State meat or poultry 

inspection (MPI) programs. These States 

have approximately 1,873 

establishments that would be eligible to 

apply for selection into the new 

cooperative interstate shipment 

program. However, because 

participation in the new program is 

voluntary, FSIS will not know how 

many States and establishments will 

apply to participate until this final rule 

becomes effective and establishments 

are selected for the program. 

In the proposed rule’s Preliminary 

Regulatory Impact Analysis (PRIA), 

FSIS explained that information 

obtained through the Agency’s outreach 

activities indicated that, as of July 2008, 

about 170 establishments in sixteen 

States had approached the State MPI 

programs to express interest in the new 

cooperative interstate shipment 

program. These sixteen States have in 

total 1,133 establishments that could 

potentially be eligible for the new 

program. However, more recent Agency 

outreach activities conducted after the 

proposed rule was published indicate 

that there now may be only four States 

interested in participating in the 

cooperative interstate shipment 

program.3 The four States that have 

recently expressed interest in the 

program are North Dakota, Ohio, 

Wisconsin, and Vermont. According to 

the State Directors of these four States, 

the total number of establishments in 

these States that might participate is 

between 27 and 102, and the actual 

number will depend on the language of 

the final rule. This finding is consistent 

with information provided in the public 

comments submitted in response to the 

proposed rule that indicated that the 

participation number we estimated in 

the proposed rule was too high. 

Therefore, we have adjusted the budget 

impact downward by incorporating the 

new information. 

Expected Benefits of the Proposed 

Action 

State-inspected establishments 

selected to participate in the new 

cooperative interstate shipment program 

will be permitted to ship and sell their 

meat and poultry products in interstate 

and foreign commerce. Thus, this final 


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24746 Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 

4Note that under this final rule, establishments 

selected for the program will be eligible to be 

reimbursed the cost to train one employee in 

HACCP and Sanitation SOPs. 

rule will benefit these establishments by 

opening new markets for their products. 

This final rule will also benefit 

consumers by generating more product 

choices, as more products can be 

shipped to new markets. In addition, 

requiring that products produced under 

the cooperative interstate shipment 

program bear a Federal inspection 

legend that includes an official State 

selected establishment inspection 

number will allow consumers to 

identify that these products were 

produced under the cooperative 

interstate shipment program if such 

products are ever the subject of an 

investigation or recall. 

States that participate in the program 

will benefit because the law requires 

that FSIS reimburse them for at least 

60% of their eligible costs related to 

inspection of selected establishments in 

the State. FSIS provides up to 50% of 

the costs to provide inspection under 

the existing cooperative State MPI 

programs. States are likely to benefit 

from the 10% increase in 

reimbursement for the cooperative 

interstate shipment program because, as 

explained below, for many States, the 

costs to administer the new program are 

not expected to greatly exceed the costs 

to administer the State MPI programs. 

The Agency received several 

comments that identified additional 

potential benefits of allowing small and 

very small State-inspected 

establishments to ship meat and poultry 

products in interstate commerce. These 

benefits include: 

1. Rural development: Allowing 

certain small and very small Stateinspected establishments to ship their 

products across State lines may 

stimulate small business sales, expand 

rural development and jobs, and 

increase local tax bases, strengthening 

the stability of rural communities, 

where many of these small 

establishments are located. 

2. Benefits for small farmers and 

livestock producers: Allowing Stateinspected processing plants to ship 

products in interstate commerce will 

benefit small farmers and local livestock 

and poultry producers by providing 

them with access to processing plants 

that can sell meat and poultry products 

across State lines. It will also benefit 

local producers by reducing travel costs 

that many must incur to send their 

livestock to a federally-inspected 

establishment, as the closest small 

processing establishment may be 

located across State lines. 

Expected Costs of the Proposed Action 

1. Costs to the participating 

establishments. To be eligible to 

participate in the cooperative interstate 

shipment program, a State-inspected 

establishment must be in compliance 

with: (1) The State-inspection program 

of the State in which the establishment 

is located and (2) the FMIA or PPIA, and 

their implementing regulations. Before 

State-inspected establishments can be 

selected to participate in a cooperative 

interstate shipment program, they will 

need to apply for selection into the 

program and demonstrate that they 

comply with both State and Federal 

requirements. 

Thus, an establishment that chooses 

to apply for selection into the program 

will incur one-time start-up costs 

associated with filing an application, 

training employees, meeting regulatory 

performance standards, obtaining label 

approval, and implementing a food 

safety system that complies with all 

Federal requirements (e.g. Sanitation 

SOP and HACCP requirements). 

In addition, to qualify for a 

cooperative interstate shipment 

program, some State-inspection 

establishments may need to invest in 

structural modifications to their 

facilities in order to comply with 

Federal standards. Based on information 

obtained through FSIS’ outreach 

activities with the States in 2008, in the 

PRIA of the proposed rule, the Agency 

estimated that the cost for Stateinspected establishments to fully 

comply with Federal standards, as 

required by the law, will range from 

$1,500 to $50,000. FSIS did not receive 

any comments or new information in 

response to the proposed rule to suggest 

changes to these estimates. 

According to most State Directors, the 

cost to very small establishments that do 

not need to make structural 

modifications to their facilities is likely 

to be in the range of $5,000 to $10,000. 

If the establishments need to make 

structural modifications or perform new 

construction, the estimated range would 

be about $15,000 to $30,000.4 However, 

because the cooperative interstate 

shipment program is a voluntary 

program, establishments that choose to 

incur the costs associated with 

participating in the program will most 

likely do so because they anticipate that 

such participation will provide an 

overall net benefit for them. 

Looking at the potential for the 

establishments to experience new 

(incremental) burden or expenses due to 

State inspection under the proposed 

cooperative interstate shipment 

program, FSIS believes that there will be 

essentially no change. FSIS is aware that 

the cooperative State MPI programs are 

not identical to the Federal inspection 

program. FSIS anticipates that States 

may need to modify their existing 

inspection procedures when providing 

inspection services to selected 

establishment in the State to ensure that 

these establishments receive inspection 

services that are ‘‘the same as’’ those 

required under the Federal program. 

However, since the State programs are 

required to be ‘‘at least equal to’’ the 

Federal inspection programs now, FSIS 

anticipates that changes that States will 

need to make to provide inspection to 

selected establishments will largely be 

procedural, and there will not be any 

particular increase or decrease in overall 

State effort that would change the 

burden of the inspection regimen on the 

establishments. 

2. Costs to the participating States. 

States that choose to participate in the 

program will be required to pay 40 

percent of the eligible costs related to 

inspection of establishments in the State 

that are selected for the program. Under 

the current cooperative program, the 

States are paying 50 percent of the 

eligible inspection costs. Although the 

inspection costs under the new program 

may be different from the costs under 

the existing program, the States’ share of 

40 percent or less is unlikely to be 

higher than its current share. 

One area the States will have to 

address is the laboratory services that 

they will be using to analyze samples 

collected under the cooperative 

interstate shipment program. To 

demonstrate that the laboratory services 

used by a State are sufficient for the 

State to qualify for the cooperative 

interstate shipment program, the State 

will need to show that the laboratory is 

accredited by an internationally 

recognized organization that accredits 

food testing laboratories against the ISO 

17025 ‘‘General requirements for the 

competence of testing and calibration 

laboratories’’ and AOAC ‘‘Guidelines for 

Laboratories Performing Food 

Microbiological and Chemical Analyses 

of Food and Pharmaceuticals Testing’’ 

written by the Analytical Laboratory 

Accreditation Criteria Committee 

(ALACC). The assessment body that 

FSIS uses, the American Association for 

Laboratory Accreditation (A2LA), is the 

sole organization that incorporates 

ALACC into their program 

requirements. State labs would need to 

use A2LA or another accrediting body 

that incorporates ALACC and is a 

signatory and in good standing to the 

Mutual Recognition Arrangements of 


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Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 24747 

5Based on Agency’s most recent (FY 2009) review 

of the 27 States’ self-assessment reports (including 

the State Laboratory Activity Tables) by the Federal 

State Audit Branch, Internal Control and Audit 

Division of the Office of Program Evaluation, 

Enforcement, and Review. 

6For details, including assumptions, for the 

baseline scenario, please see the proposed rule 

‘‘Cooperative Inspection Programs: Interstate 

Shipment of Meat and Poultry Products,’’ 

September 16, 2009, 74 FR 47658–47659. 

the International Laboratory 

Accreditation Cooperation (ILAC). 

Currently three State labs are ISO 

17025 accredited—Minnesota, North 

Carolina, and Florida (FL does not have 

a State MPI program), four States are 

actively seeking ISO 17025 

accreditation—Ohio, Wisconsin, North 

Dakota, and Vermont, and four States 

use commercial labs that are ISO 

accredited. 

States that use laboratories that do not 

use the methods described in FSIS’s 

Laboratory Guidebooks may incur costs 

to adopt such methods to analyze 

samples under the cooperative interstate 

shipment program. If a test or product 

described in the FSIS Guidebook is not 

commercially available, FSIS will assist 

the laboratory in developing an 

appropriate alternative method. 

To assist the States in developing 

laboratory services that are ‘‘the same 

as’’ those provided under the Federal 

inspection program, FSIS is adopting a 

‘‘phased in’’ approach for the States to 

become ISO 17025 accredited. FSIS’s 

Office of Public Health Science (OPHS) 

intends to provide advice and answer 

questions from State labs as they seek 

ISO accreditation. FSIS estimates the 

cost for a State lab to obtain the 

necessary accreditation to be ‘‘the same 

as’’ to be somewhere between $28,000 

and $350,000. These costs reflect the 

costs associated with purchasing 

additional equipment, hiring additional 

staff (QC manager for Chemistry, QC 

manager for Microbiology, Document 

Control Clerk, and additional analysts,) 

the initial application fee to apply for 

ISO 17025 accreditation, the annual fee 

to maintain accreditation, and the 

accrediting body’s assessment fee. 

States that choose to participate in the 

interstate shipment program may need 

to make certain modifications to their 

State inspection programs to provide 

inspection services to selected 

establishments in a manner that is ‘‘the 

same as’’ the Federal inspection 

program. However, most States that 

have implemented State meat and 

poultry products inspection (MPI) 

programs have incorporated the Federal 

requirements into their programs.5

Thus, State costs to train State 

personnel are likely to be minimal 

because many State personnel have 

received training in Federal inspection 

methodology as part of the State MPI 

program. In addition, as noted above, 

FSIS offers training courses in Federal 

inspection methodology to State 

inspection personnel. FSIS’s OOEET 

will coordinate with States participating 

in the cooperative interstate shipment 

program to provide the necessary 

training for designated State personnel. 

States may incur some costs 

associated with the processing and 

evaluation of applications submitted by 

establishments requesting to be selected 

for the cooperative interstate shipment 

program. However, because the States 

will develop their own application 

procedures, FSIS is unable to estimate 

these costs with any certainty. 

FSIS anticipates that States may need 

to revise their State inspection 

procedures when providing inspection 

services to selected establishments in 

the State to ensure that these inspection 

services are ‘‘the same as’’ those 

provided under the Federal program. 

However, since the cooperative State 

MPI programs are required to be ‘‘at least 

equal’’ to the Federal inspection 

programs now, FSIS anticipates that 

changes will largely be procedural, and 

there will not be any particular increase 

or decrease in overall State effort or 

cost. FSIS has no basis on which to 

assume anything else. 

Expected FSIS Budgetary Effects 

The new cooperative interstate 

shipment program that we are 

implementing in this final rule is 

expected to have budgetary effects on 

FSIS. This section discusses the 

baseline costs and activities, i.e., what is 

happening now before the cooperative 

interstate shipment program option is 

available, and then lays out the 

incremental effects on FSIS. The PRIA 

in the proposed rule presented a 

baseline scenario outlining the Agency’s 

spending for the Federal-State 

cooperative inspection programs for FY 

2009 through 2014 in case the 

cooperative interstate shipment program 

option is not enacted (see table below).6

We did not receive any data or comment 

in response to the proposed rule to 

suggest changes to these numbers. 

TABLE 1—BASELINE: COST FEDERAL STATE COOP PROGRAM WITH NO CHANGE

FSIS level costs, fiscal year 2010 

(Budget) 2011 2012 2013 2014 Total 5-year 

FSIS costs ........................................................................ $15.3 $15.9 $16.5 $17.1 $17.8 $82.5 

Reimburs. to States ......................................................... 50.3 52.1 54.1 56.2 58.4 271.1 

Total .......................................................................... 65.7 68.0 70.5 73.3 76.1 353.6 

FSIS Staff Years .............................................................. 29 29 29 29 29 ....................

Federal reimbursement .................................................... $50.3 $52.1 $54.1 $56.2 $58.4 $271.1 

State program spending .................................................. 50.3 52.1 54.1 56.2 58.4 271.1 

Total MPI program .................................................... 100.7 104.2 108.1 112.4 116.7 542.1 

Number of plants ............................................................. 1,873 1,873 1,873 1,873 1,873 ....................

Economic Assumptions from OMB for the 2010 Budget 

State & Local Exp, % ....................................................... 3.1 3.5 3.8 3.9 3.9 ....................

FSIS Civilian pay, % ........................................................ 5.1 4.1 4.1 4.1 4.1 ....................

Non-Pay Expenditure, % ................................................. 0.8 1.2 1.4 1.6 1.6 ....................


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24748 Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 

7For methodology of calculating this please see 

74 FR 47659–47660. 

To summarize, for each State we took the 

allocation for FY 2010 under the cooperative State 

MPI program, divided by the number of 

establishments, and then multiplied it by 1.2. 

Interstate Scenario 

To evaluate this scenario, we must 

estimate the number of establishments 

and States that will seek to participate 

and be selected for the new cooperative 

interstate shipment program. Then we 

will discuss the likely incremental 

changes in activity that could 

reasonably suggest any changes in cost 

or burden for FSIS, the States, or 

establishments. 

As noted above, in the proposed rule, 

through its outreach activities, FSIS had 

identified sixteen States that expressed 

an interest in the new cooperative 

interstate shipment program. These 

States have a total of 1,133 

establishments that could potentially be 

eligible for the new program. Because 

participation in the cooperative 

interstate shipment program is 

voluntary, the Agency could not 

estimate with certainty the number of 

eligible establishments that will choose 

to participate. Therefore, in the 

proposed rule, for illustration purposes, 

the Agency estimated the costs for three 

scenarios: 200, 400 and 600 

establishments. 

However, comments received in 

response to the proposed rule suggested 

that the Agency overestimated both the 

number of States and establishments 

that were interested in participating in 

the program. The most recent Agency 

outreach activities confirmed this 

assertion. As of November 2010, only 

four States (North Dakota, Ohio, 

Wisconsin, and Vermont) expressed 

interest in participating and, according 

to the State Directors, about 27 to 102 

establishments may apply for selection 

into the program through these four 

States. Therefore, we revised the three 

scenarios to be (1) 27 establishments in 

four States participating from FY 2011 

through 2014, (2) 102 establishments 

from four States from FY 2011 through 

2014, and (3) 102 establishments from 4 

States in FY 2011, then the participation 

increases to 200 establishments from all 

27 eligible States in FY 2012 through 

2014. The Agency understands that 

there are many other possible scenarios. 

Nevertheless, it is difficult to determine 

with any certainty which scenarios are 

more likely to occur than others; and the 

farther out (in terms of fiscal years) the 

projection, the greater the uncertainty. 

These three scenarios are for illustration 

purposes only as the number of 

participating States and establishments 

can go up or down depending on the 

perception of the final rule, the 

experience of the program once it starts, 

and other socio-economic factors. 

We started with the change in Federal 

costs for the program caused by the new 

statutory reimbursement level. For the 

cooperative interstate shipment program 

the law requires that FSIS reimburse 

States for their eligible costs related to 

the inspection of selected 

establishments in the State in an 

amount not less than 60 percent of 

eligible State costs. Under the existing 

law, FSIS may reimburse a State for up 

to 50 percent of eligible State costs to 

administer and enforce the cooperative 

State MPI. This analysis projects the 

effects of the different reimbursement 

rate on FSIS fiscal requirements 

assuming no change in State level 

activity over the baseline. FSIS assumes 

that States will not change their level of 

activity associated with selected 

establishments in the cooperative 

interstate shipment program as 

discussed above. 

To calculate this figure, FSIS 

estimated average per establishment 

spending for the cooperative interstate 

shipment program for the 

establishments in four States. For FY 

2011, the estimated additional State 

reimbursement for inspection of an 

establishment selected for the 

cooperative interstate shipment program 

compared to the reimbursement for an 

establishment operating under the 

cooperative State MPI program, is 

$12,415 (per establishment)in North 

Dakota, $5,283 in Ohio, $16,123 in 

Wisconsin, and $3,314 in Vermont.7

This and analogous figures are reflected 

in the tables below in the ‘‘Total grants 

to States’’ line for the 27, 102, and 102– 

200 establishment scenarios. 

Under section 11015 of the 2008 Farm 

Bill, FSIS is required to oversee the 

inspection activities of State personnel 

designated to provide inspection to 

selected establishments in the State. 

FSIS will incur costs associated with 

providing the necessary oversight. FSIS 

also expects to incur new costs for 

outreach and training. This will result 

in increased demand for FSIS staff and 

resources. In summary, this includes 

state coordinators, Deputy District 

Managers (DDM), outreach and training 

staff, and lab analysts to certify State 

laboratories, transition grants to hone 

establishment staff skills with HACCP 

and SOPs, and associated operating 

expenses and travel expenses. 

The statute requires FSIS to appoint a 

Federal employee to be a State 

Coordinator. As explained earlier in this 

document, the State Coordinator 

prescribed by the statute is referred to 

as the ‘‘selected establishment 

coordinator’’ (SEC) in this proposed 

rule. The SEC is required by statute to 

visit selected establishments with a 

frequency that is appropriate to ensure 

that such establishments are operating 

in a manner that is consistent with the 

FMIA and PPIA, including regulations 

and policies there under and to: (1) 

Provide oversight and enforcement of 

the program, and (2) oversee the training 

and inspection activities of Statepersonnel designated to provide 

inspection services to the selected 

establishments. SECs will further 

provide quarterly reports on each 

selected establishment under his or her 

jurisdiction to document their level of 

compliance with the requirements of the 

Acts. 

We estimate that 2 to 3 full-time 

equivalent FSIS employees will be able 

to perform the SEC functions for the 4 

States interested in participating in the 

cooperative interstate shipment 

program. It is expected that early in the 

program the SEC time will initially 

focus on outreach and start-up activities 

(including establishment selection) and 

shift over until it is more completely the 

oversight activities stipulated in the 

Acts. 

In the start-up period, in addition to 

SEC outreach efforts, FSIS expects to 

incur costs for outreach and training, 

and administration from OOEET for the 

small and very small establishments 

that are considering the cooperative 

interstate shipment program, that decide 

to apply for the program, and for those 

who are selected to participate in the 

program. OOEET will conduct face-toface workshops in every State to provide 

information to establishment owners 

and operators about the requirements of 

the new cooperative interstate shipment 

program. These workshops will not only 

educate the interested owners and 

operators about the requirements, they 

will also help them meet the 

requirements. This allocation will cover 

the cost of developing, printing, and 

shipping the workshop materials, as 

well as the cost of traveling Agency 

personnel to conduct the workshops, 

and the cost of meeting space. The cost 

is reflected in the tables below in the 

‘‘Training/Outreach’’ line. The reason 

these costs do not change between the 

scenarios of 27 and 102 is because the 

information will be provided in a 

classroom. Costs are expected to be 

largely the same whether attendance is 

high or low. Also, note that these costs 

drop sharply for each subsequent year 

as the cooperative interstate shipment 

program specific effort changes to 

operating training for establishments 

selected to participate in the program. 


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Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 24749 

8The PRIA stated that the estimated travel cost 

per SEC’s in subsequent years would be $630. This 

was a technical error and should have read $6,300. 

In the start-up period, transition grant 

authority under 9 CFR 332.12 and 9 CFR 

381.522 will be used to provide States 

funds to reimburse selected 

establishments in the State for their 

costs to train one individual in HACCP 

and associated training in Sanitation 

SOP requirements. The Agency 

estimates that the cost of training each 

establishment specialist will average 

about $5,000, including staff time and 

travel necessary for the training. Since 

this is a new expense necessary to 

implement the cooperative interstate 

shipment program and since statute 

authorizes it without State matching 

funds, these costs will be entirely new 

costs for FSIS that are part of ‘‘Total 

grants to States’’ in Table 2 below. This 

training will only be needed in the startup period and, accordingly, appears 

only in FY 2011 in Table 2 for all three 

scenarios, and again in FY 2012 in the 

102–200 establishments scenario when 

more establishments participate. 

SECs are likely to be supervised by 

Deputy District Managers (DDMs) at the 

equivalent of about 1 DDM per 300 

establishments. This is similar to the 

ratio of DDM effort used to manage 

frontline FSIS supervisors in the Federal 

programs. For the four States scenario, 

though, since the numbers of 

establishments are less than 300, there 

will be one DDM. This is reflected in the 

‘‘DDM’’ line of the tables below. 

FSIS estimates that two laboratory 

staff will be needed to complete 

periodic audits of the State inspection 

program laboratory systems and 

otherwise coordinate with the 

laboratories to ensure the sampling and 

testing programs are ‘‘the same as’’ the 

Federal program. We anticipate that the 

program needs two lab staff regardless 

of how many establishments eventually 

participate because most of the labs 

typically have a chemistry residue 

program and a microbiology program. 

This is reflected in the ‘‘Lab staff’’ line 

of the tables below. 

Travel costs are included on the 

‘‘Travel—SC & lab staff’’ line in the 

tables below. The SECs will need to 

travel a fair amount to complete their 

duties and the lab staff will need to 

travel some. Travel for SECs and lab 

staff starts in FY 2011. 

As noted above, early in the program 

the SEC’s duties will initially focus on 

outreach and start-up activities and later 

will shift to the oversight activities 

stipulated in the Acts. Thus, we project 

about $6,150 for travel for each SEC in 

the first year and $6,300 per year for 

subsequent years.8

For the lab staff we based our trips to 

the State program laboratories on one 

audit of each laboratory to make an 

initial assessment, so that would be one 

trip to the labs for each of the 4 States. 

Because most of the labs typically have 

a chemistry residue program and a 

microbiology program, two lab-auditors 

will go on each trip—one chemist and 

one microbiologist. These labs would 

also need a follow-up the next year and 

then we would make a judgment as to 

whether there needed to be annual visits 

after that. We based the number of 

audits on the figures that we had 

regarding the number of States that will 

participate. Each trip ran about $1,500 

for each auditor. 

Finally, there are the normal 

operating expenses associated with field 

operations including office space, 

communications costs, information 

technology costs (such as laptop 

computers), other equipment, and office 

supplies. FSIS estimates $3,500 per new 

staff for laptop, LincPass, and Black 

Berries. These costs are generally stable 

over time, although they inflate and, of 

course, are a little higher in the start-up 

year. These costs are found in the 

‘‘Equipment and admin’’ line of the 

tables below. 

Table 2, below, summarizes the 

incremental costs to FSIS to operate the 

new cooperative interstate shipment 

program in the three scenarios: 27, 102 

and 102-to-200 establishments. 

TABLE 2—COOPERATIVE INTERSTATE SHIPMENT PROGRAM COST ESTIMATES—THREE SCENARIOS ($ MILLIONS) 

Fiscal year 2011 2012 2013 2014 4-Year 

Interstate Program—Summary of Incremental Cost Estimates 

Costs if 27 establishments ....................................................................... 1.09 0.95 0.83 0.87 3.74 

Costs if 102 establishments ..................................................................... 1.94 1.43 1.34 1.40 6.11 

Costs if 102, then 200 establishments .................................................... 1.94 4.22 4.40 4.58 15.14 

Interstate Program with 27 Establishments 

Number of establishments ....................................................................... 27 27 27 27 ....................

Total grants to States * ............................................................................ 0.28 0.15 0.15 0.16 ....................

Total salaries & benefits .......................................................................... 0.51 0.53 0.55 0.58 ....................

DDM ......................................................................................................... 0.09 0.10 0.10 0.11 ....................

State coordinator (SC) ............................................................................. 0.16 0.17 0.17 0.18 ....................

Lab staff ................................................................................................... 0.25 0.26 0.27 0.29 ....................

Operating expenses ................................................................................. 0.31 0.26 0.12 0.12 ....................

Travel–SC & lab staff ............................................................................... 0.02 0.02 0.03 0.03 ....................

Training/Outreach .................................................................................... 0.21 0.19 0.04 0.04 ....................

Equipment and admin .............................................................................. 0.07 0.07 0.07 0.07 ....................

Total .................................................................................................. 1.09 0.95 0.83 0.87 3.74

Interstate Program with 102 Establishments 

Number of establishments ....................................................................... 102 102 102 102 ....................

Total grants to States * ............................................................................ 0.99 0.50 0.52 0.54 ....................

Total salaries & benefits .......................................................................... 0.59 0.61 0.63 0.67 ....................

DDM ......................................................................................................... 0.09 0.10 0.10 0.11 ....................

State coordinator (SC) ............................................................................. 0.24 0.25 0.26 0.27 ....................

Lab staff ................................................................................................... 0.25 0.26 0.27 0.29 ....................


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TABLE 2—COOPERATIVE INTERSTATE SHIPMENT PROGRAM COST ESTIMATES—THREE SCENARIOS ($ MILLIONS)— 

Continued 

Fiscal year 2011 2012 2013 2014 4-Year 

Operating expenses ................................................................................. 0.36 0.30 0.18 0.18 ....................

Travel–SC & lab staff ............................................................................... 0.03 0.3 0.03 0.03 ....................

Training/Outreach .................................................................................... 0.21 0.19 0.05 0.05 ....................

Equipment and admin .............................................................................. 0.12 0.11 0.11 0.11 ....................

Total .................................................................................................. 1.94 1.43 1.34 1.40 6.11

Interstate Program with 102, then 200 Establishments 

Number of establishments ....................................................................... 102 200 200 200 ....................

Total grants to States * ............................................................................ 0.99 1.64 1.20 1.25 ....................

Total salaries & benefits .......................................................................... 0.59 2.25 2.35 2.45 ....................

DDM ......................................................................................................... 0.09 0.16 0.17 0.18 ....................

State coordinator (SC) ............................................................................. 0.24 1.83 1.91 1.98 ....................

Lab staff ................................................................................................... 0.25 0.26 0.27 0.29 ....................

Operating expenses ................................................................................. 0.36 0.82 0.85 0.89 ....................

Travel–SC & lab staff ............................................................................... 0.03 0.09 0.10 0.10 ....................

Training/Outreach .................................................................................... 0.21 1.40 1.12 0.35 ....................

Equipment and admin .............................................................................. 0.12 0.36 0.38 0.39 ....................

Total .................................................................................................. 1.94 4.22 4.40 4.58 15.14 

* Note ‘‘Total grants to States’’ includes funding for Transition Grants to help establishments train one person in HACCP and SOPs per 

§ 332.12 and § 381.522. 

Effect on Small Entities—Regulatory 

Flexibility Analysis 

Pursuant to section 605(b) of the 

Regulatory Flexibility Act, 5 U.S.C. 

605(b), the FSIS Administrator certifies 

that this rule will not have a significant 

economic impact on a substantial 

number of small entities. This 

certification is based primarily on the 

fact that (1) the program is voluntary, 

and (2) the rule will benefit very small 

and certain small establishments that 

operate under cooperative State MPI 

programs. Based on FSIS’s HACCP 

(Hazard Analysis and Critical Control 

Points) size definitions, very small 

establishments have fewer than 10 

employees or generate less than $2.5 

million in annual sales; small 

establishments have 10 or more but 

fewer than 500 employees and generate 

more than $2.5 million in annual sales; 

and establishments having 500 or more 

employees are large establishments. 

Thus, very small State-inspected 

establishments and small Stateinspected establishments that have 

fewer than 25 employees on average 

will be eligible to participate in the 

cooperative interstate shipment 

program. 

This final rule will benefit very small 

and certain small establishments that 

operate under cooperative State MPI 

programs. Under section 11015, Stateinspected establishments that employ 

on average 25 or fewer employees 

would be permitted to be selected to 

participate in a cooperative interstate 

shipment program. The law also permits 

the Secretary to select State-inspected 

establishments that employ, on average, 

more than 25 but less than 35 

employees to participate in the program. 

However, to remain in the program, 

these establishments must employ, on 

average, 25 or fewer employees three 

years after the regulations implementing 

the new cooperative interstate shipment 

program become effective. FSIS 

provides for the selection of Stateinspected establishments that employ, 

on average, more than 25 but fewer than 

35 employees in the implementing 

regulations. Thus, this rule will benefit 

these very small and small Stateinspected establishments by allowing 

them to ship meat and poultry products 

in interstate and foreign commerce, 

thereby opening new markets for their 

products. 

Currently, 27 States administer 

cooperative State meat or poultry 

inspection (MPI) programs. These States 

have approximately 1,873 

establishments that would be eligible to 

apply for selection into the new 

cooperative interstate shipment 

program. As mentioned earlier in the 

preamble to this final rule, the Agency’s 

most recent outreach activities indicate 

that four States may be interested in 

participating in the program and the 

number of establishments in these 

States that might participate is between 

27 and 102. However, because 

participation in the new program is 

voluntary, FSIS will not know how 

many States and establishments will 

apply to participate until this final rule 

becomes effective and establishments 

are selected for the program. 

As discussed above, costs to the 

participating establishments are likely 

to be small. An establishment that 

chooses to apply for selection into the 

program will incur one-time start-up 

costs associated with filing an 

application, training employees, 

meeting regulatory performance 

standards, obtaining label approval, and 

implementing a food safety system that 

complies with all Federal requirements 

(e.g. Sanitation SOP and HACCP 

requirements). In addition, to qualify for 

a cooperative interstate shipment 

program, some State-inspection 

establishments may need to invest in 

structural modifications to their 

facilities in order to comply with 

Federal standards. Based on information 

obtained through FSIS’ outreach 

activities with the States in 2008, in the 

PRIA of the proposed rule, the Agency 

estimated that the cost for Stateinspected establishments to fully 

comply with Federal standards, as 

required by the law, will range from 

$1,500 to $50,000. Looking at the 

potential for the establishments to 

experience new (incremental) burden or 

expenses due to State inspection under 

the proposed cooperative interstate 

shipment program, FSIS believes that 

there will be essentially no change. FSIS 

did not receive any comments or new 

information in response to the proposed 

rule to suggest changes to these 

estimates. 

Because the cooperative interstate 

shipment program is a voluntary 


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program, establishments that choose to 

incur the costs associated with 

participating in the program will most 

likely do so because they anticipate that 

such participation will provide an 

overall net benefit for them. 

Executive Order 12988 

This final rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. This rule: (1) Preempts 

State and local laws and regulations that 

are inconsistent with this rule; (2) has 

no retroactive effect; and (3) does not 

require administrative proceedings 

before parties may file suit in court 

challenging this rule. 

E-Government Act 

FSIS and USDA are committed to 

achieving the purposes of the EGovernment Act (44 U.S.C. 3601, et 

seq.) by, among other things, promoting 

the use of the Internet and other 

information technologies and providing 

increased opportunities for citizen 

access to government information and 

services, and for other purposes. 

Executive Order 13175 

This final rule has been carefully 

evaluated for potential tribal 

implications in accordance with 

Executive Order 13175, ‘‘Consultation 

and Coordination with Indian Tribal 

Governments.’’ FSIS has concluded 

based on its evaluation that this final 

rule will not have any direct or 

substantial effects on Indian Tribes, on 

the relationship between the Federal 

Government and Indian Tribes, or on 

the distribution of power or 

responsibilities between the Federal 

Government and Indian Tribes. This 

final rule implements the Congressional 

enactment providing that States with 

approved MPI programs, that is State 

established and administered meat or 

poultry inspection programs, approved 

by FSIS pursuant to the Federal meat 

and poultry inspection laws, may now 

be eligible in their discretion to 

participate in the cooperative interstate 

shipment program established by this 

final rule. Accordingly, because this 

program is only authorized under law 

and this rule is for States with approved 

MPI programs, there are no significant 

tribal implications. Nonetheless, FSIS 

will include Tribes and intertribal 

organizations, involved in or interested 

in the meat and poultry sectors, in the 

Agency’s outreach efforts associated 

with implementation and 

administration of this final rule. In 

addition, if and when a State, with an 

MPI program approved by FSIS, satisfies 

the requirements of this final rule and 

enters into an agreement with FSIS 

regarding a cooperative interstate 

shipment program, FSIS will conduct 

outreach to Tribes and intertribal 

organizations to ensure that they are 

fully aware of the cooperative interstate 

shipment program in that State, and to 

ensure that meat or poultry 

establishments on Tribal lands have the 

opportunity to participate in the 

approved State interstate shipment 

program if they are interested in doing 

so. 

USDA Nondiscrimination Statement 

The U.S. Department of Agriculture 

(USDA) prohibits discrimination in all 

its programs and activities on the basis 

of race, color, national origin, gender, 

religion, age, disability, political beliefs, 

sexual orientation, and marital or family 

status. (Not all prohibited bases apply to 

all programs.) 

Persons with disabilities who require 

alternative means for communication of 

program information (Braille, large 

print, audiotape, etc.) should contact 

USDA’s Target Center at 202–720–2600 

(voice and TTY). 

To file a written complaint of 

discrimination, write USDA, Office of 

the Assistant Secretary for Civil Rights, 

1400 Independence Avenue, SW., 

Washington, DC 20250–9410 or call 

202–720–5964 (voice and TTY). USDA 

is an equal opportunity provider and 

employer. 

Additional Public Notification 

Public awareness of all segments of 

rulemaking and policy development is 

important. Consequently, in an effort to 

ensure that the public and in particular 

minorities, women, and persons with 

disabilities, are aware of this final rule, 

FSIS will announce it on-line through 

the FSIS Web page located at http:// 

www.fsis.usda.gov/regulations/ 

2011_Interim_&_Final_Rules_Index. 

FSIS also will make copies of this 

Federal Register publication available 

through the FSIS Constituent Update, 

which is used to provide information 

regarding FSIS policies, procedures, 

regulations, Federal Register notices, 

FSIS public meetings, and other types of 

information that could affect or would 

be of interest to our constituents and 

stakeholders. The Update is 

communicated via Listserv, a free e-mail 

subscription service consisting of 

industry, trade, and farm groups, 

consumer interest groups, allied health 

professionals, scientific professionals, 

and other individuals who have 

requested to be included. The Update 

also is available on the FSIS Web page. 

Through Listserv and the Web page, 

FSIS is able to provide information to a 

much broader, more diverse audience. 

In addition, FSIS offers an e-mail 

subscription service which provides 

automatic and customized access to 

selected food safety news and 

information. This service is available at 

http://www.fsis.usda.gov/ 

news_&_events/email_subscription/. 

Options range from recalls to export 

information to regulations, directives 

and notices. Customers can add or 

delete subscriptions themselves, and 

have the option to password protect 

their accounts. 

Paperwork Reduction Act 

In accordance with section 3507(d) of 

the Paperwork Reduction Act of 1995, 

the information collection and 

recordkeeping requirements included in 

this rule were submitted for approval to 

the Office of Management and Budget 

(OMB) when the proposed rule was 

published. OMB preapproved the 

information collection; the OMB Control 

number is 0583–0144. 

The estimated number of respondents 

in the preapproved information 

collection reflects the number of States 

and establishments that FSIS estimated 

would participate in the cooperative 

interstate shipment program when the 

Agency issued the proposed rule. FSIS 

believes that it overestimated the 

participation by States and 

establishments in the proposed rule. 

However, the Agency’s final estimated 

hours of paperwork burden per 

respondent is the same as the estimate 

provided in the proposed rule. 

Title: ‘‘Cooperative Inspection 

Programs: Interstate Shipment of Meat 

and Poultry Products.’’ 

Type of collection: New. 

Abstract: FSIS has reviewed the 

paperwork and recordkeeping 

requirements in this final rule in 

accordance with the Paperwork 

Reduction Act. Under this final rule, 

FSIS is requiring certain information 

collection and recordkeeping activities. 

States that are interested in 

participating in the cooperative 

interstate shipment program are 

required to submit a request for an 

agreement to establish such a program 

through the appropriate FSIS District 

Office. In their requests, States must: (1) 

Identify establishments in the State that 

the State recommends for initial 

selection into the program, if any; (2) 

include documentation to demonstrate 

that the State is able to provide 

necessary inspections services to 

selected establishments in the State and 

conduct any related activities that 

would be required under a cooperative 

interstate shipment program; and (3) 

agree to comply with certain conditions 

to assist with enforcement of the 


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program. States that have entered into 

an agreement with FSIS for a 

cooperative interstate shipment program 

must submit, through the FSIS district 

office, an evaluation of each Stateinspected establishment that has 

applied, and that the State recommends 

be selected, for the cooperative 

interstate shipment program. 

Under this final rule, State inspected 

establishments selected to participate in 

the cooperative interstate shipment 

program will be required to develop and 

maintain the same records that are 

required under the Acts and their 

implementing regulations. Selected 

establishment will also be required to 

give the FSIS selected establishment 

coordinator (SEC) access to all 

establishment records required under 

the Acts and implementing regulations. 

Most States that have cooperative State 

meat or poultry products inspection 

(MPI) programs have incorporated the 

Federal standards into their programs. 

Thus, most establishments selected to 

participate in the interstate shipment 

program are currently required to 

maintain records that comply with 

Federal standards. However, 

establishments located in States that 

have implemented recordkeeping 

requirements that are ‘‘at least equal to’’ 

but not identical to Federal 

requirements will need to modify their 

recordkeeping procedures to comply 

with Federal standards. All selected 

establishments will be required to give 

the FSIS SEC access to their records 

upon request. 

Estimate of Burden: When it proposed 

these regulations, FSIS estimated that 16 

of the 27 States that currently have 

agreements for cooperative State meat or 

poultry products inspection programs 

will prepare and submit a request to 

FSIS to establish a cooperative interstate 

shipment program. The Agency also 

estimated that approximately 400 

establishments will apply for the 

program. Thus, FSIS estimated that each 

of the 16 States mentioned above will 

need to prepare and submit, on average, 

25 evaluations for the State-inspected 

establishments that have applied for, 

and that the State recommends, for 

selection into the program, for an 

estimated total of 400 evaluations. 

FSIS estimates that it will take 

approximately 40 hours for each State to 

prepare and submit a request to 

establish a cooperative interstate 

shipment program, for a total burden of 

640 hours. The Agency estimates that it 

will take each State approximately 24 

hours to prepare an evaluation of a 

State-inspected establishment’s 

qualifications to be selected for a 

cooperative interstate shipment 

program, for a total burden of 9,600 

hours. 

FSIS estimates that if all of the 400 

establishments that apply are selected 

for the program, approximately 100 of 

these establishments will need to 

modify their recordkeeping procedures 

to come into compliance with Federal 

standards. The extent to which these 

establishments will need to modify their 

recordkeeping procedures will depend 

on requirements under the State 

inspection program. Because 

recordkeeping requirements under the 

State inspection program must be ‘‘at 

least equal to’’ the Federal requirements, 

these modifications should be minor. 

FSIS estimates that it will take 

approximately 16 hours for each 

establishment that is currently 

maintaining records under State 

standards to review and revise its 

recordkeeping procedures, and about 5 

minutes for each establishment to file 

these records, for a total burden of 

approximately 1608 hours. 

All of the estimated 400 

establishments that participate in the 

program will be required to give the SEC 

access to all records required under the 

Federal Acts. FSIS estimates that it will 

take each establishment approximately 

15 minutes to assist the SEC to locate 

the necessary records for review on the 

initial visit, for a total burden of 100 

hours. FSIS estimates that these 

establishments will need to spend and 

approximately 5 minutes to assist the 

SEC locate records for review for each 

subsequent visit. If the SEC visits each 

selected establishment at least once a 

month, the total burden per 

establishment per year will be 1 hour, 

for a total estimated annual burden of 

400 hours. 

Respondents: State agencies that 

administer cooperative State meat and 

poultry products inspection programs 

and State-inspected establishments 

selected to participate in a cooperative 

interstate shipment program. 

Estimated number of respondents: 

416 (16 States and 400 State-inspected 

establishments). 

Estimated number of responses per 

respondent: One request to establish a 

cooperative interstate shipment program 

per State and 25 evaluations of Stateinspected establishments per State, on 

average. 

A one-time modification of records for 

each selected establishment whose 

recordkeeping does not comply with all 

Federal standards. One initial SEC visit 

in which each selected establishment 

will need to provide the SEC with 

access to all required records. Each 

establishment selected for the program 

will need to provide the FSIS access to 

its records on an ongoing basis. 

Estimated Total Annual Burden on 

Respondents: 11,848 hours to establish 

and implement the cooperative 

interstate shipment program in 16 

States. Once the program has been 

implemented, an estimated annual 

burden of 400 hours for selected 

establishments to provide the SEC 

access to establishment records on-going 

basis. 

Copies of this information collection 

assessment can be obtained from John 

O’Connell, Paperwork Reduction Act 

Coordinator, Food Safety and Inspection 

Service, USDA, 1400 Independence 

Avenue, SW., Room 3532 South 

Building, Washington, DC 20250. 

Proposed Regulations 

List of Subjects 

9 CFR Part 321 

Grant programs-agriculture, 

Intergovernmental relations, Meat 

inspection. 

9 CFR Part 332 

Grant programs-agriculture, 

Intergovernmental relations, Meat 

inspection. 

9 CFR Part 381 

Grant programs-agriculture, 

Intergovernmental relations, Poultry and 

poultry products. 

For the reasons discussed in the 

preamble, FSIS is amending 9 CFR 

Chapter III as follows: 

PART 321—COOPERATION WITH 

STATES AND TERRITORIES 

■ 1. The authority citation for part 321 

is revised to read as follows: 

Authority: 21 U.S.C. 601–695; 7 CFR 2.18, 

2.53. 

■ 2. Section 321.3 is added to read as 

follows: 

§ 321.3 Cooperation of States for the 

interstate shipment of carcasses, parts of 

carcasses, meat, and meat food products. 

(a) The Administrator is authorized 

under 21 U.S.C. 683(b) to coordinate 

with States that have meat inspection 

programs as provided in § 321.1 of this 

part to select certain establishments 

operating under these programs to 

participate in a cooperative program to 

ship carcasses, parts of carcasses, meat, 

and meat food products in interstate 

commerce. A cooperative program for 

this purpose is called a ‘‘cooperative 

interstate shipment program.’’ 

(b) Establishments selected to 

participate in a cooperative interstate 

shipment program described in this 


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section must receive inspection services 

from designated State personnel that 

have been trained in the enforcement of 

the Act. If the designated personnel 

determine that the carcasses, parts of 

carcasses, meat, and meat food products 

prepared in establishments selected to 

participate in the cooperative interstate 

shipment program comply with all 

requirements under the Act, these items 

will bear an official Federal mark of 

inspection and may be shipped in 

interstate commerce. The Administrator 

will assign an FSIS ‘‘selected 

establishment coordinator,’’ who will be 

an FSIS employee, to each State that 

participates in a cooperative interstate 

shipment program to provide Federal 

oversight of the program and 

enforcement of the program’s 

requirements. The Federal contribution 

for inspection services provided by 

States that enter into a cooperative 

interstate shipment program under this 

section will be at least 60 percent of 

eligible State costs. Eligible State costs 

are those costs that a State has justified 

and FSIS has approved as necessary for 

the State to provide inspection services 

to selected establishments in the State. 

(c) Part 332 of this subchapter 

prescribes conditions under which 

States and establishments may 

participate in the cooperative interstate 

shipment program. 

(d) The Administrator will terminate 

a cooperative interstate shipment 

agreement with a State if the 

Administrator determines that the State 

is not conducting inspection at selected 

establishments in a manner that 

complies with the Act and the 

implementing regulations in this 

chapter. 

■ 3. Part 332 is added to read as follows: 

PART 332—SELECTED 

ESTABLISHMENTS; COOPERATIVE 

PROGRAM FOR INTERSTATE 

SHIPMENT OF CARCASSES, PARTS 

OF CARCASSES, MEAT, AND MEAT 

FOOD PRODUCTS 

Sec. 

332.1 Definitions. 

332.2 Purpose. 

332.3 Requirements for establishments; 

ineligible establishments. 

332.4 State request for cooperative 

agreement. 

332.5 Establishment selection; official 

number for selected establishments. 

332.6 Commencement of a cooperative 

interstate shipment program; inspection 

by designated personnel and official 

mark. 

332.7 Federal oversight of a cooperative 

interstate shipment program. 

332.8 Quarterly reports. 

332.9 Enforcement authority. 

332.10 Deselection of ineligible 

establishments. 

332.11 Transition to official establishment. 

332.12 Transition grants. 

332.13 Separation of operations. 

332.14 Voluntary withdrawal. 

Authority: 21 U.S.C. 601–695; 7 CFR 2.18, 

2.53. 

§ 332.1 Definitions. 

Cooperative interstate shipment 

program. A cooperative meat inspection 

program described in § 321.3 of this 

subchapter. 

Cooperative State meat inspection 

program. A cooperative State-Federal 

meat inspection program described in 

§ 321.1 of this subchapter. 

Designated personnel. State 

inspection personnel that have been 

trained in the enforcement of the Act 

and any additional State program 

requirements in order to provide 

inspection services to selected 

establishments. 

Interstate commerce. ‘‘Interstate 

commerce’’ has the same meaning as 

‘‘commerce’’ under § 301.2 of this 

subchapter. 

Selected establishment. An 

establishment operating under a State 

cooperative meat inspection program 

that has been selected by the 

Administrator, in coordination with the 

State where the establishment is 

located, to participate in a cooperative 

interstate shipment program. 

§ 332.2 Purpose. 

This part prescribes the conditions 

under which States that administer 

cooperative State meat inspection 

programs and establishments that 

operate under such programs may 

participate in a cooperative interstate 

shipment program. 

§ 332.3 Requirements for establishments; 

ineligible establishments. 

(a) An establishment that operates 

under a cooperative State meat 

inspection program may apply to 

participate in a cooperative interstate 

shipment program under this part if: 

(1) The establishment employs on 

average no more than 25 employees 

based on the standards described in 

paragraph (b) of this section, or 

(2) The establishment employed more 

than 25 employees but fewer than 35 

employees as of June 18, 2008. If 

selected to participate in a cooperative 

interstate shipment program, an 

establishment under this paragraph 

must employ on average no more than 

25 employees as of July 1, 2014, or it 

must transition to become an official 

establishment as provided in § 332.11 of 

this part. 

(b) An establishment that has 25 or 

fewer employees based on the following 

standards is considered to have 25 or 

fewer employees on average for 

purposes of this part. 

(1) All individuals, both supervisory 

and non-supervisory, employed by the 

establishment on a full-time, part-time, 

or temporary basis whose duties involve 

handling the meat or meat food 

products prepared by the establishment 

are counted when calculating the total 

number of employees. 

(2) All individuals employed by the 

establishment from a temporary 

employee agency, professional 

employee organization, or leasing 

concern whose duties involve handling 

the meat or meat food products 

prepared by the establishment are 

counted when calculating the total 

number of employees. 

(3) The average number of employees 

is calculated for each of the pay periods 

for the preceding 12 calendar months. 

(4) Part-time and temporary 

employees are counted the same as fulltime employees. 

(5) If the establishment has not been 

in business for 12 months, the average 

number of employees is calculated for 

each of the pay periods in which the 

establishment has been in business. 

(6) Volunteers who receive no 

compensation are not considered 

employees unless their duties involve 

handling the meat or meat food 

products prepared by the establishment. 

(7) The total number of employees can 

never exceed 35 individuals at any 

given time, regardless of the average 

number of employees. 

(c) The following establishments are 

ineligible to participate in a cooperative 

interstate shipment program: 

(1) Establishments that employ more 

than 25 employees on average (except as 

provided under paragraph (a)(2) of this 

section); 

(2) Establishments operating under a 

Federal-State program as provided in 

§ 321.2 of this subchapter as of June 18, 

2008; 

(3) Official establishments; 

(4) Establishments that were official 

establishments as of June 18, 2008, but 

that were re-organized on a later date by 

the person that controlled the 

establishment as of June 18, 2008; 

(5) Establishments operating under a 

cooperative State meat inspection that 

employed more than 35 employees as of 

June 18, 2008, that were reorganized on 

a later date by the person that controlled 

the establishment as of June 18, 2008; 

(6) Establishments that are the subject 

of a transition under § 332.11 of this 

part; 


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(7) Establishments that are in 

violation of the Act; and 

(8) Establishments located in States 

without a cooperative State meat 

inspection program. 

(9) Establishments located in a State 

whose agreement for a cooperative 

interstate shipment program was 

terminated by the Administrator as 

provided in § 321.3(d) of this 

subchapter. 

(d) An establishment that meets the 

conditions in paragraph (a) of this 

section and that is not an ineligible 

establishment under paragraph (c) of 

this section may apply for selection into 

a cooperative interstate shipment 

program through the State in which the 

establishment is located. 

§ 332.4 State request for cooperative 

agreement. 

(a) State participation in a cooperative 

interstate shipment program under this 

part is limited to States that have 

implemented cooperative State meat 

inspection programs. 

(b) To request an agreement for a 

cooperative interstate shipment program 

under this part, a State must submit a 

written request to the Administrator 

through the FSIS District Office for the 

FSIS District in which the State is 

located. In the request the State must: 

(1) Identify establishments in the 

State that have requested to be selected 

for the program that the State 

recommends for initial selection into 

the program, if any; 

(2) Demonstrate that the State is able 

to provide the necessary inspection 

services to selected establishments in 

the State and conduct any related 

activities that would be required under 

a cooperative interstate shipment 

program established under this part; and 

(3) Agree that, if the State enters into 

an agreement with FSIS for a 

cooperative interstate shipment 

program, the State will: 

(i) Provide FSIS with access to the 

results of all laboratory analyses 

conducted on product samples from 

selected establishments in the State; 

(ii) Notify the selected establishment 

coordinator for the State of the results 

of any laboratory analyses that indicate 

that a product prepared in a selected 

establishment may be adulterated or 

may otherwise present a food safety 

concern; and 

(iii) When necessary, cooperate with 

FSIS to transition selected 

establishments in the State that have 

been deselected from a cooperative 

interstate shipment program to become 

official establishments. 

(c) If the Administrator determines 

that a State that has submitted a request 

to participate in a cooperative interstate 

shipment program qualifies to enter into 

a cooperative agreement for such a 

program, the Administrator and the 

State will sign a cooperative agreement 

that sets forth the terms and conditions 

under which each party will cooperate 

to provide inspection services to 

selected establishments located in the 

State. 

(d) After the Administrator and a 

State have signed an agreement for a 

cooperative interstate shipment program 

as provided in paragraph (c) of this 

section, the Administrator will: 

(1) Appoint an FSIS employee as the 

FSIS selected establishment coordinator 

for the State and 

(2) Coordinate with the State to select 

establishments to participate in the 

program as provided in § 332.5(b) of this 

part. 

§ 332.5 Establishment selection; official 

number for selected establishments. 

(a) An establishment operating under 

a cooperative State meat inspection 

program will qualify for selection into a 

cooperative interstate shipment program 

if the establishment: 

(1) Has submitted a request to the 

State to be selected for the program; 

(2) Has the appropriate number of 

employees under § 332.3(a) of this part; 

(3) Is not ineligible to participate in a 

cooperative interstate shipment program 

under § 332.3(c) of this part; 

(4) Is in compliance with all 

requirements under the cooperative 

State meat inspection program; and 

(5) Is in compliance with all 

requirements under the Act and the 

implementing regulations in this 

chapter. 

(b) To participate in a cooperative 

interstate shipment program, an 

establishment that meets the conditions 

in paragraph (a) of this section must be 

selected by the Administrator, in 

coordination with the State where the 

establishment is located. 

(c) If an establishment is selected to 

participate in a cooperative interstate 

shipment program as provided in 

paragraph (b) of this section, the State 

is to assign the establishment an official 

number that reflects the establishment’s 

participation in the cooperative 

interstate shipment program and advise 

the FSIS selected establishment 

coordinator for the State of the official 

number assigned to each selected 

establishment in the State. The official 

number assigned to every selected 

establishment must contain a suffix, 

e.g., ‘‘SE,’’ that identifies the 

establishment as a selected 

establishment and that identifies the 

State, e.g., ‘‘SETX,’’ for ‘‘selected 

establishment Texas.’’ 

(d) Failure of the State to comply with 

paragraph (c) of this section will 

disqualify the State from participation 

in the cooperative interstate shipment 

program. 

§ 332.6 Commencement of a cooperative 

interstate shipment program; inspection by 

designated personnel and official mark. 

(a) A cooperative interstate shipment 

program will commence when the 

Administrator, in coordination with the 

State, has selected establishments in the 

State to participate in the program. 

(b) Inspection services for selected 

establishments participating in a 

cooperative interstate shipment program 

must be provided by designated 

personnel, who will be under the direct 

supervision of a State employee. 

(c) Carcasses, parts of carcasses, meat, 

and meat food products prepared in a 

selected establishment and inspected 

and passed by designated State 

personnel must bear an official Federal 

mark, stamp, tag, or label of inspection 

in the appropriate form prescribed in 

part 312 of this subchapter that includes 

the information specified in § 332.5(c) of 

this part. 

(d) Carcasses, parts of carcasses, meat, 

and meat food products prepared in a 

selected establishment that comply with 

the conditions in paragraph (c) of this 

section may be distributed in interstate 

commerce. 

§ 332.7 Federal oversight of a cooperative 

interstate shipment program. 

(a) The FSIS selected establishment 

coordinator for a State that has entered 

into an agreement for a cooperative 

interstate shipment program will visit 

each selected establishment in the State 

on a regular basis to verify that the 

establishment is operating in a manner 

that is consistent with the Act and the 

implementing regulations in this 

chapter. The frequency with which the 

SEC will visit selected establishments 

under the SEC’s jurisdiction will be 

based on factors that include, but are 

not limited to, the complexity of the 

operations conducted at the selected 

establishment, the establishment’s 

schedule of operations, and the 

establishment’s performance under the 

cooperative interstate shipment 

program. If necessary, the selected 

establishment coordinator, in 

consultation with the District Manager 

that covers the State, may designate 

qualified FSIS personnel to visit a 

selected establishment on behalf of the 

selected establishment coordinator. 

(b) The selected establishment 

coordinator, in coordination with the 


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State, will verify that selected 

establishments in the State are receiving 

the necessary inspection services from 

designated personnel, and that these 

establishments are eligible, and remain 

eligible, to participate in a cooperative 

interstate shipment program. The 

selected establishment coordinator’s 

verification activities may include: 

(1) Verifying that each selected 

establishment employs, and continues 

to employ, 25 or fewer employees, on 

average, as required under § 332.3(a) of 

this part, unless the establishment is 

transitioning to become an official 

establishment; 

(2) Verifying that the designated 

personnel are providing inspection 

services to selected establishments in a 

manner that complies with the Act and 

the implementing regulations in this 

chapter; 

(3) Verifying that that the State 

staffing levels for each selected 

establishments are appropriate to carry 

out the required inspection activities; 

and 

(4) Assessing each selected 

establishment’s compliance with the 

Act and implementing regulations 

under this chapter. 

(c) If the selected establishment 

coordinator determines that designated 

personnel are providing inspection 

services to selected establishments in 

the State in a manner that is 

inconsistent with the Act and the 

implementing regulations in this 

chapter, the Administrator will provide 

an opportunity for the State to develop 

and implement a corrective action plan 

to address inspection deficiencies 

identified by the selected establishment 

coordinator. If the State fails to develop 

a corrective action plan, or the selected 

establishment coordinator for the State 

determines that the corrective action 

plan is inadequate, the Administrator 

will terminate the agreement for the 

cooperative interstate shipment program 

as provided in § 321.3(d) of this chapter. 

§332.8 Quarterly reports. 

(a) The selected establishment 

coordinator will prepare a report on a 

quarterly basis that describes the status 

of each selected establishment under his 

or her jurisdiction. 

(b) The quarterly report required in 

paragraph (a) of this section will: 

(1) Include the selected establishment 

coordinator’s assessment of the 

performance of the designated 

personnel in conducting inspection 

activities at selected establishments and 

(2) Identify those selected 

establishments that the selected 

establishment coordinator has verified 

are in compliance with the Act and 

implementing regulations in this 

chapter, those that have been deselected 

under § 332.10 of this part, and those 

that are transitioning to become official 

establishments under § 332.11 of this 

part. 

(c) The selected establishment 

coordinator is to submit the quarterly 

report to the Administrator through the 

District Manager for the State where the 

selected establishments identified in the 

report are located. 

§ 332.9 Enforcement authority. 

(a) To facilitate oversight and 

enforcement of this part, selected 

establishments operating under a 

cooperative interstate shipment program 

must, upon request, give the FSIS 

selected establishment coordinator or 

other FSIS officials access to all 

establishment records required under 

the Act and the implementing 

regulations in this chapter. The 

Administrator may deselect any selected 

establishment that refuses to comply 

with this paragraph. 

(b) Selected establishment 

coordinators may initiate any 

appropriate enforcement action 

provided for in part 500 of this chapter 

if they determine that a selected 

establishment under their jurisdiction is 

operating in a manner that is 

inconsistent with the Act and the 

implementing regulations in this 

chapter. Selected establishments 

participating in a cooperative interstate 

shipment program are subject to the 

notification and appeal procedures set 

out in part 500 of this chapter. 

(c) If inspection at a selected 

establishment is suspended for any of 

the reasons specified in § 500.3 or 

§ 500.4 of this chapter, FSIS will: 

(1) Provide an opportunity for the 

establishment to implement corrective 

actions and remain in the cooperative 

interstate shipment program, or 

(2) Move to deselect the establishment 

as provided in § 332.10 of this part. 

(d) The decision to deselect a selected 

establishment under a suspension will 

be made on a case-by-case basis. In 

making this decision, FSIS, in 

consultation with the State where the 

selected establishment is located, will 

consider, among other factors: 

(1) The non-compliance that led to the 

suspension; 

(2) The selected establishment’s 

compliance history; and 

(3) The corrective actions proposed by 

the selected establishment. 

§ 332.10 Deselection of ineligible 

establishments. 

(a) The Administrator will deselect a 

selected establishment that becomes 

ineligible to participate in a cooperative 

interstate shipment program for any 

reason listed under § 332.3(c) of this 

part. 

(b) An establishment that has been 

deselected must transition to become an 

official establishment as provided in 

§ 332.11 of this part. 

§ 332.11 Transition to official 

establishment. 

(a) If an establishment is deselected 

from a cooperative interstate shipment 

program as provided in § 332.10 of this 

part, FSIS, in coordination with the 

State where the establishment is 

located, will develop and implement a 

plan to transition the establishment to 

become an official establishment. 

Except that an establishment that was 

deselected from a cooperative interstate 

shipment program because it is located 

in a State whose agreement for such a 

program was terminated may either 

transition to become an official 

establishment or transition to become a 

State-inspected establishment under the 

cooperative State meat inspection 

program. 

(b) An establishment that has been 

deselected from a cooperative interstate 

shipment program and successfully 

transitioned to become an official 

establishment may withdraw from the 

Federal inspection program and resume 

operations under the cooperative State 

meat inspection program after operating 

as an official establishment in full 

compliance with the Act for a year. 

§ 332.12 Transition grants. 

(a) Transition grants are funds that a 

State participating in a cooperative 

interstate shipment program under this 

part may apply for to reimburse selected 

establishments in the State for the cost 

to train one individual in the seven 

HACCP principles for meat or poultry 

processing as required under § 417.7 of 

this chapter and associated training in 

the development of sanitation standard 

operating procedures required under 

part 416 of this chapter. 

(b) A State participating in a 

cooperative interstate shipment program 

that receives a transition grant must use 

grant funds to reimburse the training 

costs of one employee per each selected 

establishment in the State. Any other 

use of such funds is prohibited. 

§ 332.13 Separation of operations. 

A selected establishment may conduct 

operations under the cooperative State 

meat inspection program if the 

establishment implements and 

maintains written procedures for 

complete physical separation of product 

and process for each operation by time 

or space. 


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§ 332.14 Voluntary withdrawal. 

A selected establishment that is in full 

compliance with the requirements in 

this part may voluntarily end its 

participation in a cooperative interstate 

shipment program and operate under 

the cooperative State meat inspection 

program. Establishments that 

voluntarily end their participation in 

the cooperative may re-apply for the 

program after operating under the 

cooperative State meat inspection 

program for one year. 

PART 381—POULTRY PRODUCTS 

INSPECTION REGULATIONS 

■ 4. The authority citation for part 381 

continues to read as follows: 

Authority: 7 U.S.C. 138f, 450; 21 U.S.C. 

451–470; 7 CFR 2.7, 2.18, 2.53. 

■ 5. Add § 381.187 to subpart R to read 

as follows: 

§ 381.187 Cooperation of States for the 

interstate shipment of poultry products. 

(a) The Administrator is authorized 

under 21 U.S.C. 472(b) to coordinate 

with States that have poultry products 

inspection programs as provided in 

§ 381.185 of this subpart to select 

certain establishments operating under 

these programs to participate in a 

cooperative program to ship poultry 

products in interstate commerce. A 

cooperative program for this purpose is 

called a ‘‘cooperative interstate 

shipment program.’’ 

(b) Establishments selected to 

participate in a cooperative interstate 

shipment program described in this 

section must receive inspection services 

from designated State personnel that 

have been trained in the enforcement of 

the Act. If the designated personnel 

determine that the poultry products 

prepared in establishments selected to 

participate in the cooperative interstate 

shipment program comply with all 

requirements under the Act, these items 

will bear an official Federal mark of 

inspection and may be shipped in 

interstate commerce. The Administrator 

will assign an FSIS ‘‘selected 

establishment coordinator,’’ who will be 

an FSIS employee, to each State that 

participates in a cooperative interstate 

shipment program to provide Federal 

oversight of the program and 

enforcement of the program’s 

requirements. The Federal contribution 

for inspection services provided by 

States that enter into a cooperative 

interstate shipment program under this 

section will be at least 60 percent of 

eligible State costs. Eligible State costs 

are those costs that a State has justified 

and FSIS has approved as necessary for 

the State to provide inspection services 

to selected establishments in the State. 

(c) Subpart Z, of this part 381 

prescribes conditions under which 

States and establishments may 

participate in the cooperative interstate 

shipment program. 

(d) The Administrator will terminate 

a cooperative interstate shipment 

agreement with a State if the 

Administrator determines that the State 

is not conducting inspection at selected 

establishments in a manner that 

complies with the Act and the 

implementing regulations in this 

chapter. 

■ 6. Add subpart Z to read as follows: 

Subpart Z—Selected Establishments; 

Cooperative Program for Interstate 

Shipment of Poultry Products 

Sec. 

381.511 Definitions. 

381.512 Purpose. 

381.513 Requirements for establishments; 

ineligible establishments. 

381.514 State request for cooperative 

agreement. 

381.515 Establishment selection; official 

number for selected establishments. 

381.516 Commencement of a cooperative 

interstate shipment program; inspection 

by designated personnel and official 

mark. 

381.517 Federal oversight of a cooperative 

interstate shipment program. 

381.518 Quarterly reports. 

381.519 Enforcement authority. 

381.520 Deselection of ineligible 

establishments. 

381.521 Transition to official establishment. 

381.522 Transition grants. 

381.523 Separation of operations. 

381.524 Voluntary withdrawal. 

Subpart Z—Selected Establishments; 

Cooperative Program for Interstate 

Shipment of Poultry Products 

§ 381.511 Definitions. 

Cooperative interstate shipment 

program. A cooperative poultry 

products inspection program described 

in § 381.187 of this part. 

Cooperative State poultry products 

inspection program. A cooperative 

State-Federal poultry products 

inspection program described in 

§ 381.185 of this part. 

Designated personnel. State 

inspection personnel that have been 

trained in the enforcement of the Act 

and any additional State program 

requirements in order to provide 

inspection services to selected 

establishments. 

Interstate commerce. ‘‘Interstate 

commerce’’ has the same meaning as 

‘‘commerce’’ under § 381.1 of this part. 

Selected establishment. An 

establishment operating under a State 

cooperative poultry products inspection 

program that has been selected by the 

Administrator, in coordination with the 

State where the establishment is 

located, to participate in a cooperative 

interstate shipment program. 

§ 381.512 Purpose. 

This subpart Z prescribes the 

conditions under which States that 

administer cooperative State poultry 

products inspection programs and 

establishments that operate under such 

programs may participate in a 

cooperative interstate shipment 

program. 

§ 381.513 Requirements for 

establishments; ineligible establishments. 

(a) An establishment that operates 

under a cooperative State poultry 

products inspection program may apply 

to participate in a cooperative interstate 

shipment program under this subpart if: 

(1) The establishment employs on 

average no more than 25 employees 

based on the standards described in 

paragraph (b) of this section, or 

(2) The establishment employed more 

than 25 employees but fewer than 35 

employees as of June 18, 2008. If 

selected to participate in a cooperative 

interstate shipment program, an 

establishment under this paragraph 

must employ on average no more than 

25 employees as of July 1, 2014, or it 

must transition to become an official 

establishment as provided in § 381.521 

of this subpart. 

(b) An establishment that has 25 or 

fewer employees based on the following 

standards is considered to have 25 or 

fewer employees on average for 

purposes of this subpart. 

(1) All individuals, both supervisory 

and non-supervisory, employed by the 

establishment on a full-time, part-time, 

or temporary basis whose duties involve 

handling the poultry products prepared 

by the establishment are counted when 

calculating the total number of 

employees. 

(2) All individuals employed by the 

establishment from a temporary 

employee agency, professional 

employee organization, or leasing 

concern whose duties involve handling 

the poultry products prepared by the 

establishment are counted when 

calculating the total number of 

employees. 

(3) The average number of employees 

is calculated for each of the pay periods 

for the preceding 12 calendar months. 

(4) Part-time and temporary 

employees are counted the same as fulltime employees. 

(5) If the establishment has not been 

in business for 12 months, the average 


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number of employees is calculated for 

each of the pay periods in which the 

establishment has been in business. 

(6) Volunteers who receive no 

compensation are not considered 

employees unless their duties involve 

handling the poultry products prepared 

by the establishment. 

(7) The total number of employees can 

never exceed 35 individuals at any 

given time, regardless of the average 

number of employees. 

(c) The following establishments are 

ineligible to participate in a cooperative 

interstate shipment program: 

(1) Establishments that employ more 

than 25 employees on average (except as 

provided under paragraph (a)(2) of this 

section); 

(2) Establishments operating under a 

Federal-State program as provided in 

§ 381.186 of this part as of June 18, 

2008; 

(3) Official establishments; 

(4) Establishments that were official 

establishments as of June 18, 2008, but 

that were re-organized on a later date by 

the person that controlled the 

establishment as of June 18, 2008; 

(5) Establishments operating under a 

cooperative State poultry products 

inspection program that employed more 

than 35 employees as of June 18, 2008, 

that were reorganized on a later date by 

the person that controlled the 

establishment as of June 18, 2008; 

(6) Establishments that are the subject 

of a transition under § 381.521 of this 

subpart; 

(7) Establishments that are in 

violation of the Act; and 

(8) Establishments located in States 

without a cooperative State poultry 

products inspection program. 

(9) Establishments located in a State 

whose agreement for a cooperative 

interstate shipment program was 

terminated by the Administrator as 

provided in § 381.187(d) of this part. 

(d) An establishment that meets the 

conditions in paragraph (a) of this 

section and that is not an ineligible 

establishment under paragraph (c) of 

this section may apply for selection into 

a cooperative interstate shipment 

program through the State in which the 

establishment is located. 

§ 381.514 State request for cooperative 

agreement. 

(a) State participation in a cooperative 

interstate shipment program under this 

subpart is limited to States that have 

implemented cooperative State poultry 

products inspection programs. 

(b) To request an agreement for a 

cooperative interstate shipment program 

under this subpart, a State must submit 

a written request to the Administrator 

through the FSIS District Office for the 

FSIS District in which the State is 

located. In the request the State must: 

(1) Identify establishments in the 

State that have requested to be selected 

for the program that the State 

recommends for initial selection into 

the program, if any; 

(2) Demonstrate that the State is able 

to provide the necessary inspection 

services to selected establishments in 

the State and conduct any related 

activities that would be required under 

a cooperative interstate shipment 

program established under this subpart; 

and 

(3) Agree that, if the State enters into 

an agreement with FSIS for a 

cooperative interstate shipment 

program, the State will: 

(i) Provide FSIS with access to the 

results of all laboratory analyses 

conducted on product samples from 

selected establishments in the State; 

(ii) Notify the selected establishment 

coordinator for the State of the results 

of any laboratory analyses that indicate 

that a product prepared in a selected 

establishment may be adulterated or 

may otherwise present a food safety 

concern; and 

(iii) When necessary, cooperate with 

FSIS to transition selected 

establishments in the State that have 

been deselected from a cooperative 

interstate shipment program to become 

official establishments. 

(c) If the Administrator determines 

that a State that has submitted a request 

to participate in a cooperative interstate 

shipment program qualifies to enter into 

a cooperative agreement for such a 

program, the Administrator and the 

State will sign a cooperative agreement 

that sets forth the terms and conditions 

under which each party will cooperate 

to provide inspection services to 

selected establishments located in the 

State. 

(d) After the Administrator and a 

State have signed an agreement for a 

cooperative interstate shipment program 

as provided in paragraph (c) of this 

section, the Administrator will: 

(1) Appoint an FSIS employee as the 

FSIS selected establishment coordinator 

for the State and 

(2) Coordinate with the State to select 

establishments to participate in the 

program as provided in § 381.515(b) of 

this subpart. 

§ 381.515 Establishment selection; official 

number for selected establishments. 

(a) An establishment operating under 

a cooperative State poultry products 

inspection program will qualify for 

selection into a cooperative interstate 

shipment program if the establishment: 

(1) Has submitted a request to the 

State to be selected for the program; 

(2) Has the appropriate number of 

employees under § 381.513(a) of this 

subpart; 

(3) Is not ineligible to participate in a 

cooperative interstate shipment program 

under § 381.513(c) of this subpart; 

(4) Is in compliance with all 

requirements under the cooperative 

State poultry products inspection 

program; and 

(5) Is in compliance with all 

requirements under the Act and the 

implementing regulations in this 

chapter. 

(b) To participate in a cooperative 

interstate shipment program, an 

establishment that meets the conditions 

in paragraph (a) of this section must be 

selected by the Administrator, in 

coordination with the State where the 

establishment is located. 

(c) If an establishment is selected to 

participate in a cooperative interstate 

shipment program as provided in 

paragraph (b) of this section, the State 

is to assign the establishment an official 

number that reflects the establishment’s 

participation in the cooperative 

interstate shipment program and advise 

the FSIS selected establishment 

coordinator for the State of the official 

number assigned to each selected 

establishment in the State. The official 

numbers assigned to every selected 

establishment must contain a suffix, 

e.g., ‘‘SE,’’ that identifies the 

establishment as a selected 

establishment; that includes the letter 

‘‘P,’’ which identifies the establishment 

as a poultry establishment; and that 

identifies the State, e.g., ‘‘SEPND,’’ for 

‘‘selected establishment poultry North 

Dakota.’’ 

(d) Failure of a State to comply with 

paragraph (c) of this section will 

disqualify the State from participation 

in the cooperative interstate shipment 

program. 

§ 381.516 Commencement of a 

cooperative interstate shipment program; 

inspection by designated personnel and 

official mark. 

(a) A cooperative interstate shipment 

program will commence when the 

Administrator, in coordination with the 

State, has selected establishments in the 

State to participate in the program. 

(b) Inspection services for selected 

establishments participating in a 

cooperative interstate shipment program 

must be provided by designated 

personnel, who will be under the direct 

supervision of a State employee. 

(c) Poultry products processed in a 

selected establishment and inspected 

and passed by designated State 


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personnel must bear an official Federal 

mark, stamp, tag, or label of inspection 

in the appropriate form prescribed in 

subpart M of this part that includes the 

information specified in § 381.515(c) of 

this subpart. 

(d) Poultry products processed in a 

selected establishment that comply with 

the conditions in paragraph (c) of this 

section may be distributed in interstate 

commerce. 

§ 381.517 Federal oversight of a 

cooperative interstate shipment program. 

(a) The FSIS selected establishment 

coordinator for a State that has entered 

into an agreement for a cooperative 

interstate shipment program will visit 

each selected establishment in the State 

on a regular basis to verify that the 

establishment is operating in a manner 

that is consistent with the Act and the 

implementing regulations in this 

chapter. The frequency with which the 

SEC will visit selected establishments 

under the SEC’s jurisdiction will be 

based on factors that include, but are 

not limited to, the complexity of the 

operations conducted at the selected 

establishment, the establishment’s 

schedule of operations, and the 

establishment’s performance under the 

cooperative interstate shipment 

program. If necessary, the selected 

establishment coordinator, in 

consultation with the District Manager 

that covers the State, may designate 

qualified FSIS personnel to visit a 

selected establishment on behalf of the 

selected establishment coordinator. 

(b) The selected establishment 

coordinator, in coordination with the 

State, will verify that selected 

establishments in the State are receiving 

the necessary inspection services from 

designated personnel, and that these 

establishments are eligible, and remain 

eligible, to participate in a cooperative 

interstate shipment program. The 

selected establishment coordinator’s 

verification activities may include: 

(1) Verifying that each selected 

establishment employs, and continues 

to employ, 25 or fewer employees, on 

average, as required under § 381.513(a) 

of this part, unless the establishment is 

transitioning to become an official 

establishment; 

(2) Verifying that the designated 

personnel are providing inspection 

services to selected establishments in a 

manner that complies with the Act and 

the implementing regulations in this 

chapter; 

(3) Verifying that that the State 

staffing levels for each selected 

establishments are appropriate to carry 

out the required inspection activities; 

and 

(4) Assessing each selected 

establishment’s compliance with the 

Act and implementing regulations in 

this chapter. 

(c) If the selected establishment 

coordinator determines that designated 

personnel are providing inspection 

services to selected establishments in 

the State in a manner that is 

inconsistent with the Acts and the 

implementing regulations in this 

chapter, the Administrator will provide 

an opportunity for the State to develop 

and implement a corrective action plan 

to address inspection deficiencies 

identified by the selected establishment 

coordinator. If the State fails to develop 

a corrective action plan, or the selected 

establishment coordinator for the State 

determines that the corrective action 

plan is inadequate, the Administrator 

will terminate the agreement for the 

cooperative interstate shipment program 

as provided in § 381.187(d) of this part. 

§ 381.518 Quarterly reports. 

(a) The selected establishment 

coordinator will prepare a report on a 

quarterly basis that describes the status 

of each selected establishment under his 

or her jurisdiction. 

(b) The quarterly report required in 

paragraph (a) of this section will: 

(1) Include the selected establishment 

coordinator’s assessment of the 

performance of the designated 

personnel in conducting inspection 

activities at selected establishments and 

(2) Identify those selected 

establishment that the selected 

establishment coordinator has verified 

are in compliance with the Act and 

implementing regulations in this 

chapter, those that have been deselected 

under § 381.520 of this subpart, and 

those that are transitioning to become 

official establishments under § 381.521 

of this subpart. 

(c) The selected establishment 

coordinator is to submit the quarterly 

report to the Administrator through the 

District Manager for the State where the 

selected establishments identified in the 

report are located. 

§ 381.519 Enforcement authority. 

(a) To facilitate oversight and 

enforcement of this subpart, selected 

establishments operating under a 

cooperative interstate shipment program 

must, upon request, give the FSIS 

selected establishment coordinator or 

other FSIS officials access to all 

establishment records required under 

the Act and the implementing 

regulations in this chapter. The 

Administrator may deselect any selected 

establishment that refuses to comply 

with this paragraph. 

(b) Selected establishment 

coordinators may initiate any 

appropriate enforcement action 

provided for in part 500 of this chapter 

if they determine that a selected 

establishment under their jurisdiction is 

operating in manner that is inconsistent 

with the Act and the implementing 

regulations in this chapter. Selected 

establishments participating in a 

cooperative interstate shipment program 

are subject to the notification and 

appeal procedures set out in part 500 of 

this chapter. 

(c) If inspection at a selected 

establishment is suspended for any of 

the reasons specified in § 500.3 or 

§ 500.4 of this chapter, FSIS will: 

(1) Provide an opportunity for the 

establishment to implement corrective 

actions and remain in the cooperative 

interstate shipment program, or 

(2) Move to deselect the establishment 

as provided in § 381.520 of this subpart. 

(d) The decision to deselect a selected 

establishment under a suspension will 

be made on a case-by-case basis. In 

making this decision, FSIS, in 

consultation with the State where the 

selected establishment is located, will 

consider, among other factors: 

(1) The non-compliance that led to the 

suspension; 

(2) The selected establishment’s 

compliance history; and 

(3) The corrective actions proposed by 

the selected establishment. 

§ 381.520 Deselection of ineligible 

establishments. 

(a) The Administrator will deselect a 

selected establishment that becomes 

ineligible to participate in a cooperative 

interstate shipment program for any 

reason listed under § 381.513(c) of this 

subpart. 

(b) An establishment that has been 

deselected must transition to become an 

official establishment as provided in 

§ 381.521 of this subpart. 

§ 381.521 Transition to official 

establishment. 

(a) If an establishment is deselected 

from a cooperative interstate shipment 

program as provided in § 381.520 of this 

subpart, FSIS, in coordination with the 

State where the establishment is 

located, will develop and implement a 

plan to transition the establishment to 

become an official establishment. 

Except that an establishment that was 

deselected from a cooperative interstate 

shipment program because it is located 

in a State whose agreement for such a 

program was terminated may either 

transition to become an official 

establishment or transition to become a 

State-inspected establishment under the 


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Federal Register / Vol. 76, No. 84 / Monday, May 2, 2011 / Rules and Regulations 24759 

cooperative State poultry products 

inspection program. 

(b) An establishment that has been 

deselected from a cooperative interstate 

shipment program and successfully 

transitioned to become an official 

establishment may withdraw from the 

Federal inspection program and resume 

operations under the cooperative State 

poultry products inspection program 

after operating as an official 

establishment in full compliance with 

the Act for a year. 

§ 381.522 Transition grants. 

(a) Transition grants are funds that a 

State participating in a cooperative 

interstate shipment program under this 

subpart may apply for to reimburse 

selected establishments in the State for 

the cost to train one individual in the 

seven HACCP principles for meat or 

poultry processing as required under 

§ 417.7 of this chapter and associated 

training in the development of 

sanitation standard operating 

procedures required under part 416 of 

this chapter. 

(b) A State participating in a 

cooperative interstate shipment program 

that receives a transition grant must use 

grant funds to reimburse the training 

costs of one employee per each selected 

establishment in the State. Any other 

use of such funds is prohibited. 

§ 381.523 Separation of operations. 

A selected establishment may conduct 

operations under the cooperative State 

poultry products inspection program if 

the establishment implements and 

maintains written procedures for 

complete physical separation of product 

and process for each operation by time 

or space. 

§ 381.524 Voluntary withdrawal. 

A selected establishment that is in full 

compliance with the requirements in 

this part may voluntarily end its 

participation in a cooperative interstate 

shipment program and operate under 

the cooperative State poultry products 

inspection program. Establishments that 

voluntarily end their participation in 

the cooperative may re-apply for the 

program after operating under the 

cooperative State poultry products 

inspection program for one year. 

Done at Washington, DC, on: March 31, 

2011. 

Alfred V. Almanza, 

Administrator. 

[FR Doc. 2011–9865 Filed 4–29–11; 8:45 am] 

BILLING CODE P 


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