This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

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Rules and Regulations Federal Register

33289 

Vol. 77, No. 109 

Wednesday, June 6, 2012 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 28 

[Doc. AMS–CN–12–0005] 

RIN 0581–AD23 

User Fees for 2012 Crop Cotton 

Classification Services to Growers 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: The Agricultural Marketing 

Service (AMS) will maintain user fees 

for cotton producers for 2012 crop 

cotton classification services under the 

Cotton Statistics and Estimates Act and 

the Cotton Standards Act of 1923 at 

$2.20 per bale—the same level as in 

2011. This fee and the existing reserve 

are sufficient to cover the costs of 

providing classification services for the 

2012 crop, including costs for 

administration and supervision. 

DATES: Effective Date: June 7, 2012. 

FOR FURTHER INFORMATION CONTACT: 

Darryl Earnest, Deputy Administrator, 

Cotton & Tobacco Programs, AMS, 

USDA, 3275 Appling Road, Room 11, 

Memphis, TN 38133. Telephone (901) 

384–3060, facsimile (901) 384–3021, or 

email darryl.earnest@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: 

Executive Order 12866 

This final rule has been determined to 

be not significant for purposes of 

Executive Order 12866; and, therefore 

has not been reviewed by the Office of 

Management and Budget (OMB). 

Executive Order 12988 

This final rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. It is not intended to 

have retroactive effect. There are no 

administrative procedures that must be 

exhausted prior to any judicial 

challenge to the provisions of this rule. 

Regulatory Flexibility Act and 

Paperwork Reduction Act 

Pursuant to requirements set forth in 

the Regulatory Flexibility Act (RFA) (5 

U.S.C. 601–612), AMS has considered 

the economic impact of this action on 

small entities and has determined that 

its implementation will not have a 

significant economic impact on a 

substantial number of small businesses. 

The purpose of the RFA is to fit 

regulatory actions to the scale of 

businesses subject to such actions so 

that small businesses will not be 

disproportionately burdened. There are 

an estimated 25,000 cotton growers in 

the U.S. who voluntarily use the AMS 

cotton classing services annually, and 

the majority of these cotton growers are 

small businesses under the criteria 

established by the Small Business 

Administration (13 CFR 121.201). 

Continuing the user fee at the 2011 crop 

level as stated will not significantly 

affect small businesses as defined in the 

RFA because: 

(1) The fee represents a very small 

portion of the cost-per-unit currently 

borne by those entities utilizing the 

services. (According to USDA’s 

Economic Research Service, the U.S. 

average total cost of production in 2010 

was $483 per bale. The user fee for 

classification services of $2.20 per bale 

represents less the one half percent of 

this average U.S. per-bale cost of 

production.); 

(2) The fee for services will not affect 

competition in the marketplace; 

(3) The use of classification services is 

voluntary. For the 2011 crop, 

approximately 15.1 million bales were 

produced; and, almost all of these bales 

were voluntarily submitted by growers 

for the classification service; and 

(4) Based on the average price paid to 

growers for cotton from the 2010 crop of 

0.8212 cents per pound, 500 pound 

bales of cotton are worth an average of 

$410 each. The user fee for classification 

services, $2.20 per bale, is less than one 

percent of the value of an average bale 

of cotton. 

In compliance with Office of 

Management and Budget (OMB) 

regulations (5 CFR part 1320), which 

implement the Paperwork Reduction 

Act (PRA) (44 U.S.C. 3501–3520), the 

information collection requirements 

contained in the regulation to be 

amended is currently approved under 

OMB control number 0581–0008, Cotton 

Classing, Testing and Standards. 

Fees for Classification Under the Cotton 

Statistics and Estimates Act of 1927 

This final rule establishes the 2012 

user fee charged to producers for cotton 

classification at $2.20 per bale—the 

same as the 2011 user fee. The 2012 user 

fee was set in accordance to section 

14201 of the Food, Conservation, and 

Energy Act of 2008 (Pub. L. 110–234) 

(2008 Farm Bill). Section 14201 of the 

2008 Farm Bill provides that: (1) The 

Secretary shall make available cotton 

classification services to producers of 

cotton, and provide for the collection of 

classification fees from participating 

producers or agents that voluntarily 

agree to collect and remit the fees on 

behalf of the producers; (2) 

classification fees collected and the 

proceeds from the sales of samples 

submitted for classification shall, to the 

extent practicable, be used to pay the 

cost of the services provided, including 

administrative and supervisory costs; (3) 

the Secretary shall announce a uniform 

classification fee and any applicable 

surcharge for classification services not 

later than June 1 of the year in which 

the fee applies; and (4) in establishing 

the amount of fees under this section, 

the Secretary shall consult with 

representatives of the United States 

cotton industry. At pages 313–314, the 

Joint Explanatory Statement of the 

committee of conference for section 

14201 stated the expectation that the 

cotton classification fee would be 

established in the same manner as was 

applied during the 1992 through 2007 

fiscal years. Specifically, it states that 

the classification fee should continue to 

be a basic, uniform fee per bale fee as 

determined necessary to maintain costeffective cotton classification service. 

Further, in consulting with the cotton 

industry, the Secretary should 

demonstrate the level of fees necessary 

to maintain effective cotton 

classification services and provide the 

Department of Agriculture with an 

adequate operating reserve, while also 

working to limit adjustments in the 

year-to-year fee. 

Under the provisions of section 

14201, a user fee (dollar amount per 

bale classed) is established for the 2012 

cotton crop that, when combined with 

other sources of revenue, will result in 


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33290 Federal Register / Vol. 77, No. 109 / Wednesday, June 6, 2012 / Rules and Regulations 

projected revenues sufficient to 

reasonably cover budgeted costs— 

adjusted for inflation—and allow for 

adequate operating reserves to be 

maintained. Costs considered in this 

method include salaries, costs of 

equipment and supplies, and other 

overhead costs, such as facility costs 

and costs for administration and 

supervision. In addition to covering 

expected costs, the user fee is set such 

that projected revenues will generate an 

operating reserve adequate to effectively 

manage uncertainties related to crop 

size and cash-flow timing while meeting 

minimum reserve requirements set by 

the Agricultural Marketing Service, 

which require maintenance of a reserve 

fund amount equal to at least four 

months of projected operating costs. 

The user fee charged to cotton 

producers for cotton classification in 

2012 is $2.20 per bale, which is the 

same fee charged for the 2011 crop. This 

fee is based on the preseason projection 

that 14,475,000 bales will be classed by 

the United States Department of 

Agriculture during the 2012 crop year. 

Accordingly, § 28.909, paragraph (b) 

reflects the continuation of the cotton 

classification fee at $2.20 per bale. 

As provided for in the 1987 Act, a 5 

cent per bale discount will continue to 

be applied to voluntary centralized 

billing and collecting agents as specified 

in § 28.909(c). 

Growers or their designated agents 

receiving classification data will 

continue to incur no additional fees if 

classification data is requested only 

once. The fee for each additional 

retrieval of classification data in 

§ 28.910 will remain at 5 cents per bale. 

The fee in § 28.910(b) for an owner 

receiving classification data from the 

National Database will remain at 5 cents 

per bale, and the minimum charge of 

$5.00 for services provided per monthly 

billing period will remain the same. The 

provisions of § 28.910(c) concerning the 

fee for new classification memoranda 

issued from the National Database for 

the business convenience of an owner 

without reclassification of the cotton 

will remain the same at 15 cents per 

bale or a minimum of $5.00 per sheet. 

The fee for review classification in 

§ 28.911 is maintained at $2.20 per bale. 

The fee for returning samples after 

classification in § 28.911 will remain at 

50 cents per sample. 

Summary of Comments 

A proposed rule was published in the 

Federal Register on April 11, 2012, with 

a comment period of April 11, 2012 

through April 26, 2012 (77 FR 21684). 

AMS received two comments: One from 

a national trade organization that 

represents approximately 80 percent of 

the U.S. cotton industry, including 

cotton producers, ginners, 

warehousemen, merchants, 

cooperatives, cottonseed processors, and 

textile manufacturers from Virginia to 

California; and one from a national trade 

organization comprised of eight state 

and regional membership organizations 

that represent approximately 680 

individual cotton ginning operations in 

17 cotton-producing states. Comments 

from the national trade organizations 

expressed support for the decision to 

maintain the fee at the level established 

for the 2011 crop. Comments may be 

viewed at www.regulations.gov. 

Pursuant to 5 U.S.C. 533, good cause 

exists for not postponing the effective 

date of this final rule until 30 days after 

publication in the Federal Register 

because this rule maintains uniform 

user fees for 2012 crop cotton 

classification services as mandated by 

the Cotton Statistics and Estimates Act, 

at the same level as 2011. 

List of Subjects in 7 CFR Part 28 

Administrative practice and 

procedure, Cotton, Reporting and 

recordkeeping requirements, 

Warehouses. 

For the reasons set forth in the 

preamble, 7 CFR part 28 is amended to 

read as follows: 

PART 28—[AMENDED] 

Subpart D—[Amended] 

■ 1. The authority citation for 7 CFR 

part 28, Subpart D, continues to read as 

follows: 

Authority: 7 U.S.C. 51–65; 7 U.S.C. 471– 

476. 

■ 2. In § 28.909, paragraph (b) is revised 

to read as follows: 

§ 28.909 Costs. 

* * * * * 

(b) The cost of High Volume 

Instrument (HVI) cotton classification 

service to producers is $2.20 per bale. 

* * * * * 

■ 3. In § 28.911, the last sentence of 

paragraph (a) is revised to read as 

follows: 

§ 28.911 Review classification. 

(a) * * * The fee for review 

classification is $2.20 per bale. 

* * * * * 

Dated: May 30, 2012. 

David R. Shipman, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2012–13527 Filed 6–5–12; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 205 

[Document Number AMS–NOP–09–0074; 

NOP–09–01FR] 

RIN 0581–AC96 

National Organic Program (NOP); 

Sunset Review (2012) 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: This final rule addresses 

recommendations submitted to the 

Secretary of Agriculture (Secretary) by 

the National Organic Standards Board 

(NOSB) on April 29, 2010, October 28, 

2010, and April 29, 2011. These 

recommendations pertain to the 2012 

Sunset Review of substances on the U.S. 

Department of Agriculture’s (USDA) 

National List of Allowed and Prohibited 

Substances (National List). Consistent 

with the NOSB recommendations, this 

final rule continues, without change, the 

exemptions (use) and prohibitions for 

multiple listings on the National List for 

5 years after their respective sunset 

dates. This final rule also amends the 

exemptions (use) for 7 substances and 

removes the exemptions for 3 

substances on the National List. 

DATES: Effective Dates: This rule is 

effective June 27, 2012, except for the 

amendments to §§ 205.601(g) and 

205.605(a), which are effective October 

21, 2012. For more information on these 

effective dates and renewals, see the 

SUPPLEMENTARY INFORMATION. 

FOR FURTHER INFORMATION CONTACT: 

Melissa R. Bailey, Ph.D., Director, 

Standards Division, Telephone: (202) 

720–3252; Fax: (202) 205–7808. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The Organic Foods Production Act of 

1990 (OFPA) (7 U.S.C. 6501–6522) 

authorizes the establishment of the 

National List of Allowed and Prohibited 

Substances (National List). The National 

List identifies synthetic substances that 

may be used in organic production and 

nonsynthetic (natural) substances that 

are prohibited in organic crop and 

livestock production. The National List 

also identifies nonagricultural 

nonsynthetic, nonagricultural synthetic 

and nonorganic agricultural substances 

that may be used in organic handling. 

The exemptions and prohibitions 

granted under the OFPA are required to 

be reviewed every 5 years by the 

National Organic Standards Board 


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