31246 Federal Register / Vol. 65, No. 96 / Wednesday, May 17, 2000 / Rules and Regulations

List of Subjects in 7 CFR Part 301

Agricultural commodities, Plant

diseases and pests, Quarantine,

Reporting and recordkeeping

requirements, Transportation.

PART 301—DOMESTIC QUARANTINE

NOTICES

Accordingly, we are adopting as a

final rule, without change, the interim

rule that amended 7 CFR part 301 and

that was published at 65 FR 4865–4866

on February 2, 2000.

Authority: 7 U.S.C. 147a, 150bb, 150dd,

150ee, 150ff, 161, 162, and 164–167; 7 CFR

2.22, 2.80, and 371.2(c).

Done in Washington, DC, this 12th day of

May 2000.

Craig A. Reed,

Administrator, Animal and Plant Health

Inspection Service.

[FR Doc. 00–12437 Filed 5–16–00; 8:45 am]

BILLING CODE 3410–34–U

DEPARTMENT OF AGRICULTURE

Rural Utilities Service

7 CFR Part 1710

RIN 0572–AB52

General and Pre-Loan Policies and

Procedures Common to Insured and

Guaranteed Loans

AGENCY: Rural Utilities Service, USDA.

ACTION: Direct final rule.

SUMMARY: The Rural Utilities Service

(RUS) is amending its regulations to

allow flexibility in determining whether

a borrower needs to solicit bids from all

sources for new or replacement

generation. It is also deleting the

requirement that borrowers seek bids if

RUS financial assistance is requested

from all sources for generation projects

of 10 megawatts or more or for

modifications to existing plants if it

results in an increase in capacity of 10

percent. RUS will review each project

on a case by case basis and determine

whether there is a need for a borrower

to seek bids from all sources for the

project.

DATES: This rule will become effective

July 3, 2000 unless we receive written

adverse comments or written notice of

intent to submit adverse comments on

or before June 16, 2000. If we receive

such comments or notice, we will

publish a timely document in the

Federal Register withdrawing the rule.

Comments received will be considered

under the proposed rule published in

this edition of the Federal Register in

the proposed rule section. A second

public comment period will not be held.

Parties interested in commenting on this

action should do so at this time.

ADDRESSES: Submit adverse comments

or notice of intent to submit adverse

comments to F. Lamont Heppe, Jr.,

Director, Program Development and

Regulatory Analysis, Rural Utilities

Service, U.S. Department of Agriculture,

Stop 1522, 1400 Independence Avenue,

SW, Washington, DC 20250–1522.

Telephone: (202) 720–9550. RUS

requires a signed original and three

copies of all comments (7 CFR 1700.4).

Comments will be available for public

inspection during regular business

hours (7 CFR 1.27(b)).

FOR FURTHER INFORMATION CONTACT: Wei

M. Moy, Chief, Power Resources &

Planning Branch, Power Supply

Division, Rural Utilities Service, U.S.

Department of Agriculture, Stop 1568,

1400 Independence Avenue, SW,

Washington, DC 20250–1568.

Telephone: (202) 720–1438. FAX (202)

720–1401. E-mail: wmoy@rus.usda.gov.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This rule has been determined to be

not significant for the purposes of

Executive Order 12866 and, therefore,

has not been reviewed by the Office of

Management and Budget (OMB).

Executive Order 12988

This rule has been reviewed under

Executive Order 12988, Civil Justice

Reform. RUS has determined that this

rule meets the applicable standards

provided in section 3 of the Executive

Order. In addition, all state and local

laws and regulations that are in conflict

with this rule will be preempted. No

retroactive effect will be given to this

rule, and in accordance with § 212(e) of

the Department of Agriculture

Reorganization Act of 1994 (7 USC

6912(e)) administrative appeal

procedures, if any, must be exhausted

before an action against the Department

or its agencies may be initiated.

Regulatory Flexibility Act Certification

RUS has determined that this rule

will not have a significant impact on a

substantial number of small entities, as

defined in the Regulatory Flexibility Act

(5 U.S.C. 601 et seq.). The RUS electric

program provides loan and loan

guarantees to borrowers at interest rates

and terms that are more favorable than

those generally available from the

private sector. Small entities are not

subjected to any requirements which are

not applied equally to large entities.

RUS borrowers, as a result of obtaining

federal financing, receive economic

benefits that exceed any direct

economic costs associated with

complying with RUS regulations and

requirements.

Information Collection and

Recordkeeping Requirements

This rule contains no additional

information collection or recordkeeping

requirements under the Paperwork

Reduction Act of 1995 (44 U.S.C.

Chapter 35).

Catalog of Federal Domestic Assistance

The program described by this rule is

listed in the Catalog of Federal Domestic

Assistance programs under No. 10.850,

Rural Electrification Loans and Loan

Guarantees. This catalog is available on

a subscription basis from the United

States Government Printing Office,

Washington, DC 20402–9325, telephone

number (202) 512–1800.

Executive Order 12372

This rule is excluded from the scope

of Executive Order 12372,

Intergovernmental Consultation, which

may require consultation with State,

local and tribal governments or the

private sector. See the final rule related

notice entitled ‘‘Department Programs

and Activities Excluded from Executive

Order 12372’’ (50 FR 47034).

Unfunded Mandates

This rule contains no Federal

mandates (under the regulatory

provision of title II of the Unfunded

Mandates Reform Act) for State, local,

and tribal governments or the private

sector. Thus, this rule is not subject to

the requirements of section 202 and 205

of the Unfunded Mandates Reform Act.

National Environmental Policy Act

Certification

The Administrator of RUS has

determined that this rule will not

significantly affect the quality of the

human environment as defined by the

National Environmental Policy Act of

1969 (42 U.S.C. 4321 et seq.). Therefore,

this action does not require an

environmental impact statement or

assessment.

Background

Section 1710.254 provides that RUS

will consider providing financial

assistance to borrowers for the

construction of generation facilities and

the modification of existing generation

facilities only if certain conditions are

met. The requirements also apply to

financial assistance for all new

generation facilities of 10 megawatts or

more and for modifications to existing

Federal Register / Vol. 65, No. 96 / Wednesday, May 17, 2000 / Rules and Regulations 31247

generation facilities that would result in

an increase of generation capacity of 10

percent or more. This section provides

that all loan requests for any type of

addition of generation capacity,

including replacement and modification

of existing capacity, will be accepted by

RUS only when the applicant has

satisfactorily completed the

investigation of possible alternative

sources of power. The applicant is

required to search out and attempt to

utilize capacity available from RUS

borrowers and other organizations

before developing plans for additional

generation capacity. The applicant must

solicit power and energy purchase

proposals from all reasonable potential

sources of power by the issuance of a

formal Request for Proposals (RFP) to all

sources. The applicant is also required

to evaluate all alternative proposals

received on an economic, present value

basis, giving consideration to costeffectiveness, reliability of service, the

short and long-term financial viability of

the supplier, and the financial risk to

the borrower and its creditors. After

evaluating all proposals, the applicant is

to negotiate final proposals with entities

submitting the best acceptable offers.

This entire process is required to

determine if there are other entities that

could supply the additional power and

energy needs of the applicant without

RUS financial assistance.

This process is very time consuming,

costly and, in many cases, is not

needed. The entire process can take

more than a year in some cases. At the

conclusion of the process, the business

opportunities and the best approach to

meet the applicant’s specific need may

no longer be available or no longer

available at the projected cost.

The electric energy industry in the

United States is experiencing ongoing

deregulation. This has increased

competition in the industry and the

need for RUS borrowers to be able to

meet the power needs of their members

and the power needs of the rural

consumers in a timely, cost effective

manner. Presently, there is an

abundance of public information and

reports assessing market conditions of

various regions of the country, utility

market trends, market forecasts, and

projected projects for various markets.

As such, in certain cases, an RFP is not

needed nor is the expense and time

involved in the solicitation useful or

justified.

The rapidly changing and

increasingly competitive environment of

the electric utility industry requires

borrowers to make certain decisions

regarding the need for generation

facilities and the type of facilities

needed in a very short time frame to

enable them to meet their power supply

needs in the most reliable and

economical manner. The borrower’s

intended use of the generation facilities

is critical to any determination as to

need and cost. An example of this is the

installation of peaking generation

facilities to meet peak loads. Due to

reliability problems, growing demand

and the high cost of power and energy

experienced by some electric utilities

during peak demand periods in recent

years, there is an increasing need for

peaking generation units. The gas

turbine manufacturers are unable to

keep up with the demand. As a result,

RUS borrowers must be able to take full

advantage of any business opportunities

in order to maintain their

competitiveness and be able to obtain

peaking units to meet their peak loads.

Due to the time consuming process

required by the existing requirements of

§ 1710.254, this can and has been an

impediment to the borrowers obtaining

capacity to meet peaking requirements

in a reliable and economical manner.

Another concern of the borrowers and

RUS is that the process required by

§ 1710.254 is expensive, especially

when the sole reason to issue an RFP is

to meet the requirements of this

regulation. To meet these requirements,

some borrowers have had to hire

consultants to assist them in the RFP

and evaluation process. This has added

to the time necessary to complete the

process and added to the cost. For

projects such as upgrades or

modifications to existing generation

facilities, which result in an increase in

generation capacity, the economics and

the actual need are generally clear,

hence, the RFP requirement contained

in § 1710.254 and the associated costs

are an unnecessary expense in most

cases.

List of Subjects in 7 CFR 1710

Electric power, Electric utilities, Loan

programs-energy, Reporting and

recordkeeping requirements, Rural

areas.

Accordingly, 7 CFR chapter XVII is

amended as follows:

PART 1710—GENERAL AND PRELOAN POLICIES AND PROCEDURES

COMMON TO INSURED AND

GUARANTEED ELECTRIC LOANS

1. The authority citation for part 1710

continues to read as follows:

Authority: 7 U.S.C. 901 et seq., 1921 et

seq., and 6941 et seq.

2. Amend § 1710.254 by revising

paragraphs (a)(2), (b), (c), (d), and (e) to

read as follows:

§ 1710.254 Alternative sources of power.

(a) * * *

(2) If a borrower already owns and

operates the types of facilities included

in a loan request, then a loan for the

purposes contained in paragraph (a)(1)

of this section, as well as for the

construction of transmission facilities

by a distribution borrower, will be

considered and evaluated by RUS in

terms of whether the proposed facilities

constitute an effective and economical

means of meeting the power

requirements of the consumers. A

borrower shall contact RUS as soon as

practicable in order for RUS to review

information submitted by the borrower

and advise the borrower, in writing,

whether there is a need for the borrower

to investigate and seek alternative

sources of power. RUS will determine,

based on information provided by the

borrower or otherwise available,

whether there is a need to investigate

alternative sources of power or whether

RUS will require information or other

methods of determining the need for the

generation capacity. RUS will base its

determination on whether RUS is able

to conclude that the project is needed,

the borrower would incur delays and

costs in pursuing an RFP, or that an RFP

is not likely to produce new alternatives

to the project.

(b) Loan requests for the addition of

generation capacity, including

replacement of existing capacity, will be

accepted by RUS when the applicant

has completed the requirements

established by RUS, in a manner

satisfactory to RUS. The investigations

of alternative sources of power must be

coordinated in advance with RUS. This

section applies to RUS financed

generation capacity whether owned

solely by the borrower, owned on an

undivided ownership basis with other

utilities or substantially controlled by

the borrower.

(c) The applicant may be required to

seek and utilize capacity available from

RUS borrowers and other organizations

before developing plans for additional

generation capacity. RUS may require,

on a case by case basis, that the

applicant, among other things:

(1) Solicit power and energy purchase

proposals from all reasonable potential

sources of power, such as other electric

cooperatives, investor-owned utilities,

municipal utility organizations, and

Federal and state power authorities.

(2) Solicit proposals from

independent power producers,

including co-generators, to determine

31248 Federal Register / Vol. 65, No. 96 / Wednesday, May 17, 2000 / Rules and Regulations

the terms and conditions under which

these producers can supply the

additional power and energy needs of

the applicant, without RUS financial

assistance. Such solicitations should be

placed in at least three national

newspapers or trade publications, and

they meet all planning, coordination or

other requirements imposed by state

authorities, as well as the environmental

requirements of RUS.

(d) When solicitations are received in

accordance with paragraph (c) of this

section, the applicant will evaluate all

alternative proposals on an economic,

present-value basis, giving

consideration to cost-effectiveness,

reliability of service, the short-term and

long-term financial viability of the

supplier, and the financial risk to the

borrower and its creditors. The

applicant will keep RUS fully informed

on these evaluations and provide

supporting information and analysis as

requested by RUS.

(e) After evaluation of all proposals

received in accordance with paragraph

(c) of this section, and having informed

RUS of the results, the applicant may be

required to negotiate final proposals

with the entities submitting the best

acceptable offers. Contracts requiring

RUS approval will either be approved in

advance by the Administrator or contain

a provision that the contract is not valid

until approved, in writing, by the

Administrator. The Administrator will

approve the contracts in a timely

manner provided that the borrower has

met all applicable requirements,

including, among other matters,

evidence that the alternative source of

power selected is an economical and

effective alternative.

* * * * *

Dated: May 5, 2000.

Jill Long Thompson,

Under Secretary, Rural Development.

[FR Doc. 00–11986 Filed 5–16–00; 8:45 am]

BILLING CODE 3410–15–P

DEPARTMENT OF AGRICULTURE

Farm Service Agency

7 CFR Part 1951

RIN 0560–AF91

Disaster Set-Aside Program—Second

Installment Set-Aside

AGENCY: Farm Service Agency, USDA.

ACTION: Interim rule.

SUMMARY: The Farm Service Agency

(FSA) is amending the disaster set-aside

program requirement to allow FSA to

set aside portions of loan installments

that could not be made as scheduled

due to a natural disaster, as declared by

the President or Secretary of

Agriculture, or because of low

commodity prices received during the

1999 crop year. In addition, disaster setaside eligibility requirements are

amended to require borrowers to

develop a positive cash flow projection

which will at least permit the borrower

to pay all operating and family living

expenses and meet scheduled payments

on all debts for the next business

accounting year. These provisions will

allow the agency to service the loans of

farmers who have experienced losses

due to a natural disaster or low

commodity prices in an efficient and

timely manner while ensuring the future

viability of the operation.

DATES: The effective date for this rule is

May 17, 2000. Comments on this rule

must be submitted by July 17, 2000 to

be assured consideration.

ADDRESSES: Submit written comments

to Director, Farm Loan Programs, Loan

Servicing and Property Management

Division, United States Department of

Agriculture, Farm Service Agency,

STOP 0523, 1400 Independence

Avenue, SW, Washington, DC 20250–

0523.

FOR FURTHER INFORMATION CONTACT:

Michael Cumpton, telephone (202) 690-

4014; electronic mail: mike—

cumpton@wdc.fsa.usda.gov.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This rule has been determined to be

significant and was reviewed by the

Office of Management and Budget under

Executive Order 12866.

Regulatory Flexibility Act

In compliance with the Regulatory

Flexibility Act (5 U.S.C. 601, et seq.),

the undersigned certifies that this rule

will not have a significant economic

impact on a substantial number of small

entities. New provisions included in

this rule will not impact a substantial

number of small entities to a greater

extent than large entities. Large entities

are subject to these rules to the same

extent as small entities. Therefore, a

regulatory flexibility analysis was not

performed.

Environmental Impact Statement

It is the determination of FSA that

this action is not a major Federal action

significantly affecting the environment.

Therefore, in accordance with the

National Environmental Policy Act of

1969, and 7 CFR part 1940, subpart G,

an Environmental Impact Statement is

not required.

Executive Order 13132

The policies contained in this rule do

not have any substantial direct effect on

states, on the relationship between the

national government and the states, or

on the distribution of power and

responsibilities among the various

levels of government. Nor does this rule

impose substantial direct compliance

costs on state and local governments.

Therefore, consultation with the states

is not required.

Executive Order 12988

This rule has been reviewed in

accordance with Executive Order 12988,

Civil Justice Reform. In accordance with

this rule: (1) All State and local laws

and regulations that are in conflict with

this rule will be preempted; (2) no

retroactive effect will be given to this

rule; and (3) administrative proceedings

in accordance with 7 CFR part 11, and

7 CFR part 780 if the decision is made

by the FSA county committee or

personnel subordinate to the county

committee, must be exhausted before

bringing suit in court challenging action

taken under this rule.

Executive Order 12372

For reasons contained in the notice

related to 7 CFR part 3015, subpart V

(48 FR 29115, June 24, 1983), the

programs to which this rule pertains are

excluded from the scope of E.O. 12372,

requiring intergovernmental

consultation with State and local

officials.

The Unfunded Mandates Reform Act of

1995

Title II of the Unfunded Mandates

Reform Act of 1995 (UMRA), Pub. L.

104–4, requires Federal agencies to

assess the effects of their regulatory

actions on State, local, and tribal

governments or the private sector of

$100 million or more in any 1 year.

When such a statement is needed for a

rule, section 205 of the UMRA requires

FSA to prepare a written statement,

including a cost benefit assessment, for

proposed and final rules with ‘‘Federal

mandates’’ that may result in such

expenditures for State, local, or tribal

governments, in the aggregate, or to the

private sector. UMRA generally requires

agencies to consider alternatives and

adopt the most cost effective or least

burdensome alternative that achieves

the objectives of the rule.

This rule contains no Federal

mandates, as defined under title II of the

UMRA, for State, local, and tribal

governments or the private sector. Thus,