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### United States Department of Agriculture Animal and Plant Health Inspection Service January 2013 **Initial Regulatory Flexibility Analysis**

**Proposed Rule**  **APHIS -**  **2008 -**  **0011 RIN 0579**  **- AD75**  **Restructuring of Regulations on the Importation of**  **Plants for Plantin g** 

Policy & Program Development Policy Analysis & Developmenti



### Summary This analy sis examines the potential economic impacts on small entities of a proposed rule to restructure the regulations contained in 7 CFR p art 319 that govern the importation of plants for planting. T his action would provide for more efficient application of these regulations, while not making an y m ajor changes to current import restrictions. Besides improving the clarity of these regulations, the proposed rule would:

 Consolidate the requirements for importation of plants for pla nting into one subpart in 7 CFR part 319, and add most of the plants for planting that are listed as prohibited to the list of those whose importation is not authorized pending a plant risk assessment;

 Remove several lists of approved items (for example, approved growing media, packing materials, and ports of entry) from the regulations and instead provide these lists to the public in the Plants for Planting Manual;

 Move restrictions in the CFR on the importation of specific ty pes of plants for planting to the Plants for Planting Manual;

 Establish a framework for the use of integrated pest management measures where appropriate in the production of specific types of plants for planting for importation into the United States;

 Simplify

postentry quarantine re quirements; and

 Establish a process for making changes to import restrictions on specific types of plants for planting after taking public comment on notices published in the Federal Register , rather than by

publishing proposed and final rules. While nearly

all importers of plants for planting that would be directl y affected by the proposed rule are small, APHI S believes it unlikely that an y economic impacts would beii

significant , including instances in which ph yt osanitary certification would be n ewl y required
. The proposed changes would facilitate access to information on import restrictions for specific ty pes of plants for planting , and creat e a more efficient process for amend ing import requirements
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**Table of Contents** Summary
................................ ................................ ................................ .............................. i Introduction
................................ ................................ ................................ ......................... 1 Initial Regulato ry

Flexibility

Anal ys is
................................ ................................ ................ 3 Reasons Action is Being Considered
................................ ................................ .............. 3 Objectives of and Legal Basis for the Rule
................................ ................................ .... 3 Potentially

Affected Small Entities
................................ ................................ ................. 4 Projected Reporting, Recordkeeping, and Other Compliance Requirements
................. 5 Duplication, Overlap, or Conflict with Existing Rules and Regulations
........................ 7 Alternatives to minimize Significant Economic Impacts of the Rule
............................. 71



### Introduction APHI S is proposing to restructure the regulations contained in 7 CFR part 319 that govern the importation of plants for planting. T his action would provide for more efficient application of these regulations, while not making any major change s to current import restrictions. Besides improving the clarity of these regulations, the proposed rule would:

 Consolidate the requirements for importation of plants for planting into one subpart in 7 CFR part 319, and add most of the plants for planting that are listed as prohibited to the list of those whose importation is not authorized pending a plant risk assessment;

 Remove several lists of approved items (for example, approved growing media, packing materials, and ports of entry) from the regulation s and instead provide these lists to the public in the Plants for Planting Manual;

 Move restrictions in the CFR on the importation of specific ty pes of plants for planting to the Plants for Planting Manual;

 Establish a framework for the use of integrated p est management measures where appropriate in the production of specific types of plants for planting for importation into the United States;

 Simplify

postentry quarantine requirements; and

 Establish a process for making changes to import restrictions on specific t ypes of plants for planting after taking public comment on notices published in the Federal Register , rather than by

publishing proposed and final rules. The structural changes to the regulations and the Plants for Planting Manual would result i n improved service b y APHI S to importers and other entities that may be affected. Establishment of the notice
- based process for changing import restrictions is expected to be2

particularl y beneficial. This process has been effectively used with respect to fruit and vegetable imports for several years. When introduced, the expected benefits of a notice
- based process for fruit and vegetable imports were much the same as those expected for this proposed rule:

By eliminating the need for specific prior rule making for notice
- based process commodities, considerable time savings could be reaped. The current process for approving new imports takes a notable period of time, ranging on average from 18 months to upwards of 3 years (beginning with the initial reque st and ending with the publication of the final rule). A significant portion of this time is accounted for in the rulemaking process. This rule will reduce the time needed for approval of some fruits and vegetables for import without eliminating the oppo rtunity for public participation in our anal ys is of risk. 1 The time savings that can be achieved has been quantified in APHI S’ Business Process Improvement (BPI) initiative. 2 Reportedly , the average time required from receipt of a workplan or from the closing of the comment period to the entry of a rule or notice into departmental clearance is 185 days for plant import rules, compared to 52 day s for plant import notices. 3 In other words, importers of plants for planting can expect changes in import restrictions for commodities that qualify for the notice
- based process to be accomplished more than four months sooner than they

would be through rulemaking.

1 Excerpt from the Executive Summary of the Final Economic and Final Regulatory Flexibility Analyses; Final Rule: Revision of "Subpart
-- Fruit s and Vegetables" (7 CFR 319.56 through 319.56
- 8); Docket No. APHIS
- 2005
- 0106, October 2006. http://www.regulations.gov/#!documentDetail;D=APHIS
- 2005
- 0106
- 0061 2 “Process Improvement: 2011 Progress on Agency Efforts,” October 2011, USDA APHIS. 3 Under the BPI initiative, APHIS intends to further streamline both processes, reducing the average time required for rule preparation to 123 days and for notice preparation to 35 days.3



### Initial Regulatory Fle **xibility Analysis** The Regulatory

Flexibility

Act requires agencies to evaluate the potential effects of their proposed and final rules on small businesses, small organizations and small governmental jurisdictions. Section 603 of the Act requires agencies to prepare and make available for public comment an initial regulatory flexibility

analy sis that describes expected impacts of a proposed rule on small entities. **Reasons Action is Being Considered** T he proposed rule would allow APHI S to update restriction s on the importation of plants for planting more quickly and efficiently

while maintaining transparency and opportunities for public input. The proposed rule would also establish the Plants for Planting Manual as a complete guide to restrictions on specif ic ty pes of plants for planting, and would make the regulations easier to navigate in finding general restrictions on the importation of plants for planting. T his action would make the regulations easier to use and to implement
. **Objectives of**  **and Legal Ba sis for the Rule**  The objective of the proposed rule is to restructure our regulations governing the importation of plants for planting
. In accordance with the Plant Protection Act of 2000 (Public Law 106
- 224), the Secretary of Agriculture is authorized to undertake such actions as may be necessary to prevent the introduction and spread of plant pests and noxious weeds within the United States. The Secretary has delegated this responsibility to the Administrator of the Animal and Plant Health Inspection Se rvice.4

**Potentially Affected Smal**  **l Entities** The entities most likely

to be affected b y this rule are businesses that import plants for planting , man y of which are classified within one of three North American Industry Classification Sy stem (NAI CS) categories:

 NAI CS 424910, Farm Supplies Merchant Wholesalers;

 NAI CS 424930, Flower, Nursery Stock, and Florists’ Supplies Merchant Wholesalers; or

 NAI CS 444220, Nursery and Garden Centers
. The Small Business Administration (SBA) has established standards for determining when entities are considered small. An entity classified within NAI CS 424910 or 424930 is considered small if it has 1 00 or fewer emplo ye es . An entity classified within NAI CS 444220 is considered small if it has annual receipts of $ 10 million or less. 4 A review of statistics, as reported in the 2007 Economic Census, indicates that that the vast majority of the entities potentially

affected by

this rule are considered small
. 5 Of the 7,738 establishments classified within NAI CS 424910, there were 7,677 (or approximately 99 percent) operating the entire year with fewer than 100 employees. Of the 4,218 establishments classified within NAI CS 424930, there were 4,151 (or approxi mately 98 percent) operating the entire year with fewer than 100 employees. Of the 12,804 establishments classified within NAI CS 444220, there were 12,366 (or approximately

97 percent) operating the entire year with sales receipts less than $10 million. Clearly , the majority

of potentially affected entities are small.

4 Based on the small business size standards matched to industries describe d in the North American Industry Classification System, as modified by the Office of Management and Budget in 2007 , and reported in SBA’s Small Business Size regulations contained in 13 CFR 121. 5 Source of data by NAICS classification: 2007 Economic Census, U.S. Census Bureau.5

**Projected Reporting, Recordkeeping, and Other**  **Compliance Requirement**  **s** Under the proposed rule, plants for planting offered for importation into the United States would need to be accompanied by a ph yt osanitary

certificate, except for (i) small lots of seeds under certain conditions and (ii) plants for planting either authorized b y the APHI S Administrator or listed in the Plants for Planting Manual as not requiring a phy tosanitary certificate. Currentl y, certain subparts of part 319 do not require that a ph ytosanitary certificate be acquired. P lants for planting that have been allowed to be imported under these subparts would be subject to the general requirements of the plants for planting regulations, including obtaining a ph yt osanitary certificate. APHI S is also proposing to amend the other subparts to indicate that they do not regulate the importation of plants for planting and to remove those provisions. T he se subparts in part 319
currently regulate the importation of cottonseed that can be used either for planting or for processing ; sugarcane, including sugarcane for planting ; the citrus subfamilies Aurantioideae, Rutoideae, and Toddalioideae of the famil y Rutaceae , to prevent the introduction of citrus canker and other citrus diseases ; In dian corn and maize and related plants from certain countries ; rice plants and plant parts ; wheat articles from various countries ; unroasted coffee, which can be used either for planting or processing ; articles regulated to prevent the introduction of Khapra beetle ; and articles regulated to prevent the introduction of gy ps y moth. The cost of ph yt osanitary certificates varies b y country and often by

the value of the consignment. As a point of reference , the user fee charged for ph yt osanitary certificates issued by PPQ for commercial consignments (valued at $1, 250 or more) is $106, and for non

-6

commercial consignments (valued at less than $1,250) is $61. 6 Certificates issued other than during normal working hours are subject to overtime fees as well. In addition, an exporter who receives a phy

tosanitary certificate issued on behalf of APHI S by a designated State or count y inspector must pay

an administrative user fee of $6 if the Phy tosanitary Certificat e Issuance and Tracking S ys tem (PCI T) is used and $12 if PCI T is not used
. APHI S does not have information regarding the number of additional phy tosanitary certificates that would be required because of the proposed rule or their cost. A phy tosanitary
certificate is required for most plants for planting under § 319.37
- 4. Obtaining a ph yt osanitary certificate would be the responsibility of the export er . The incidence of a certificate’s cost, that is, the portion borne by

the exporter and the portion passed on to the importer , would depend on the relative responsiveness of exporters and importers to the cost change. Any e ffects of changes in price (because of the additional cost of certification) on supply and demand can be expected to vary from one c ommodity

group to another and even within commodity groups depending on the size of th is price change relative to the value of the consignment. W e believe that the cost of phy tosanitary certificates newly

required by

this proposed rule would be small when compared to the average value of the consignments. The commodities affected , particularl y grains, are generall y shipped in very large volumes. APHI S therefore does not expect the phy

tosanitary certification requirement to significantl y affect importers o f commodities not currently requiring certification
. We welcome information that stakeholders and others may

offer that would help us to better understand likel y effects of this part of the proposed rule.

6 http://www.aphis.usda.gov/import_export/plants/plant_exports/userfees_export_certificate.shtml7

**Duplication, Overlap ,**  **or Conflict with Existing**  **Rules and Regulations** APHI S has not identified any duplication, overlap, or conflict of the proposed rule with other Federal rules. **Alternatives to minimize Significant Economic Impacts of the**  **Rule** APHI S expect s the proposed restructuring of the plants for planting import regulations to benefit small entities by providing the framework and processes by which both APHI S and importers may

operate more efficientl y. In man y i nstances , the proposed rule would enable changes in imp ort restrictions to be accomplished more quickly using a transparent notice
- based process that would continue to allow for public input
. We do not foresee this rule having a significant effect on small entities , but welcome informed comment that would pro vide us with a better understanding of the expected impact of expand ing the phy tosanitary certificate requirement
. A phy

tosanitary certificate is considered an essential element in mitigating risk s associated with plants for planting. In the absence of apparent significant economic impacts, we have not identified alternatives that would minimize such impacts.