Secretary of State

STATEMENT OF NEED AND FISCAL IMPACT

A Notice of Proposed Rulemaking Hearing accompanies this form.

Department of Agriculture 603

Agency and Division Administrative Rules Chapter Number

Establishing a statewide control area for giant reed Arundo donax

Rule Caption (Not more than 15 words that reasonably identifies the subject matter of the agency's intended action.)

In the Matter of:

Statutory Authority:

Regulation of giant reed, Arundo donzax.

ORS 570.405

Other Authority:

ORS 561.190

Statutes Implemented:

ORS 570.405

Need for the Rule(s):

Giant reed, Arundo donax, is a promising bio-energy crop because of its high biomass production. It is also an invasive noxious weed. PGE is

proposing to switch their Boardman Power Plant from coal to bio-fuel by 2020. These proposed rules are designed to allow production of giant

reed for biofuel under permit while protecting Oregon from uncontrolled spread of this potential weed. The proposed rule also addresses

ornamental and woodwind reed uses of giant reed. Wild-type giant reed would be phased out of the nursery industry. Variegated varieties

would continue to be allowed unless the State Weed Board lists giant reed as a noxious weed.

Fiscal and Economic Impact:

-Producers of giant reed for biofuel would be subject to an annual assessment of $2.00/acre to cover the cost of monitoring. They would also

have to post a bond in the amount of $100/acre up to $1,000,000 to cover the cost of eradication if giant reed becomes feral.

-Nurseries currently selling wild-type giant reed would have to phase it out of their inventory. The fiscal impact would be minimal as more

popular variegated varieties would continue to be allowed.

-Giant reed could potentially cost the state millions of dollars if it escapes and becomes an invasive noxious weed. On the other hand, it could

become an important green biofuel crop that would be carbon-neutral and replace coal as a fuel for the Boardman Power Plant. These

potential costs and benefits are difficult to predict because it is unclear if giant reed will be invasive in Oregon.

Statement of Cost of Compliance:

1. Impact on state agencies, units of local government and the public (ORS 183.335(2)(b)(E)):

The $2.00/acre assessment paid by biofuel producers would support survey and monitoring activities to ensure the giant reed does not

escape into the environment. This fee is designed to replace agency costs so the overall impact on the Department of Agriculture or the

County Weed Program should be neutral.

2. Cost of compliance effect on small business (ORS 183.336):

a. Estimate the number of small business and types of businesses and industries with small businesses subject to the rule:

Farmers could benefit from the availability of a new crop. Farmers near the PGE Boardman Power Plant are most likely to try growing giant

reed. It is unclear whether it will be profitable or not, but the cost of compliance with the regulations ($2/acre) will be insignificant relative to the

costs of production.

b. Projected reporting, recordkeeping and other administrative activities required for compliance, including costs of

professional services:

A $2/acre monitoring fee and a $1 million bond to cover eradication would be required for producers growing giant reed as a biofuel crop.

There would be no cost for nurseries or landowners, but they would not be able to grow giant cane except for the variegated varieties.

c. Equipment, supplies, labor and increased administration required for compliance:

How were small businesses involved in the development of this rule?

Documents Relied Upon, and where they are available:

-Plant Pest Risk Assessment for Giant Reed, Arundo donax L. Feb. 2011. Oregon Dept. of Agriculture, 635 Capitol St NE, Salem, OR 97301.

16pp.

-Weed Risk Assessment for Arundo donax L. (Poaceae) -- Giant Reed. June 14, 2012. USDA, APHIS, APHIS, Plant Epidemiology and Risk

Analysis Laboratory, Center for Plant Health Science and Technology, 1730 Varsity Dr., Suite 300, Raleigh, NC 27606. Version 1, 18 pp.
Printed Name Email Address Date Filed

Administrative Rules Unit, Archives Division, Secretary of State, 800 Summer Street NE, Salem, Oregon 97310. ARC 925-2007

Sue Gooch Susan.C.Gooch@state.or.us 9-12-12 4:28 PM

c. Equipment, supplies, labor and increased administration required for compliance:

Growing giant reed as a crop will require farm equipment and labor similar to corn. Compliance with the proposed rule will not change that.

If not, why?:

How were small businesses involved in the development of this rule?

Administrative Rule Advisory Committee consulted?:

Small businesses and farmers were represented on the Advisory Committee.

Yes

Last Day (m/d/yyyy) and Time

for public comment

11-09-2012 5:00 p.m.