[Federal Register Volume 74, Number 149 (Wednesday, August 5, 2009)]
[Rules and Regulations]
[Pages 38889-38890]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-18690]


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DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Part 210

[FNS-2005-0009]
RIN 0584-AD83


Marketing and Sale of Fluid Milk in Schools

AGENCY: Food and Nutrition Service, USDA.

ACTION: Final Rule.

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SUMMARY: This rule finalizes the interim rule that implemented the 
statutory provision to prohibit direct or indirect restrictions on the 
sale or marketing of fluid milk on school premises or at school-
sponsored events, at any time or in any place, in schools participating 
in the National School Lunch Program. This rule ensures that there are 
no policies or procedures in place that have the effect of restricting 
the sale or marketing of fluid milk.

DATES: Effective Date: This action is effective September 4, 2009.

FOR FURTHER INFORMATION CONTACT: Melissa Rothstein, Chief, Policy and 
Program Development Branch, Child Nutrition Division, Food and 
Nutrition Service, U.S. Department of Agriculture, 3101 Park Center 
Drive, Room 640, Alexandria, Virginia 22302-1594; or (703) 305-2590; or 
<a href="/cdn-cgi/l/email-protection#296a676d60677d6c7b676c7d694f475a075c5a4d48074e465f"><span class="__cf_email__" data-cfemail="aae9e4eee3e4feeff8e4effeeaccc4d984dfd9cecb84cdc5dc">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 102 of the Child Nutrition and WIC Reauthorization Act of 
2004 (Pub. L. 108-265) amended section 9(a)(2) of the Richard B. 
Russell National School Lunch Act, 42 U.S.C. 1758, by adding a 
provision that prohibits schools participating in the National School 
Lunch Program (NSLP), or any person approved by a school participating 
in the NSLP, from directly or indirectly restricting the sale or 
marketing of fluid milk products at any time or in any place on school 
premises or at school-sponsored events. The Food and Nutrition Service 
(FNS) published an interim rule on November 21, 2005 (70 FR 70031) to 
prohibit school food authorities (SFAs) from entering into contracts 
that restrict the sale or marketing of fluid milk.
    Contracts between SFAs and vendors can be structured to restrict 
the variety or types of food choices a school may offer outside of the 
school meal programs. Prior to implementation of the interim rule, some 
exclusive vending contracts were found to have the potential to limit a 
school's ability to sell or market fluid milk on school premises 
outside of the school meal programs; however, very few if any were 
found to actually limit the sale or marketing of fluid milk.
    The intent of this rule is to ensure no vending contract restricts 
a school's ability or discretion to provide children access to fluid 
milk outside of the school meal programs. This rule does not require 
that participating schools sell or market fluid milk outside of the 
NSLP, or make fluid milk available at school-sponsored events. 
Furthermore, this rule does not affect the requirements for offering 
fluid milk as part of a reimbursable lunch in the NSLP as described in 
7 CFR 210.10(m).
    For additional background information, please refer to the interim 
rule.

II. Discussion of Public Comments and FNS Response

    FNS received a total of eight comments during the 180-day comment 
period that ended on May 22, 2006. The commenters included 
representatives from dairy industry trade associations (3), a school 
food authority (1), a State agency (1), and individuals (3).
    Of the eight comments received, six of the commenters, including 
one individual and the representatives from a school food authority, a 
State agency, and the trade associations, were in support of finalizing 
the requirements as established by the interim rule to prohibit any 
restriction of the sale or marketing of fluid milk in participating 
schools.
    One commenter in support of the provision also felt that the 
Department should extend the rulemaking to prohibit or restrict all 
exclusive beverage contracts in participating schools.
    Under existing NSLP regulations at 7 CFR 210.21, SFAs must comply 
with requirements intended to ensure the integrity of procurement 
practices for the purchase of goods and services with funds from the 
nonprofit school foodservice account. Furthermore, NSLP regulations 
provide SFAs with the flexibility to enter into vending contracts that 
best meet their needs for foods and beverages sold outside of the 
school meal programs. This rulemaking is intended to ensure vending 
contracts do not directly or indirectly restrict the sale or marketing 
of fluid milk at any time or in any place on school premises or at 
school-sponsored events. Other procurement issues regarding vending 
contracts and agreements are outside the scope of this rulemaking.
    Two of the individual commenters expressed opposition to 
implementing the rule as final because of concern that it favors dairy 
industry interests and inhibits schools' ability to choose whether to 
sell or market fluid milk. One commenter also disapproved of 
conventional dairy production practices.
    This rulemaking does not require or promote the sale or marketing 
of fluid milk outside the school meal programs. SFAs retain the 
authority to establish procurement contracts in accordance with Program 
regulations for foods sold outside of the school meal programs that 
best meet the nutritional and operational needs of their students and 
schools.
    Finally, discussion of conventional dairy production practices is 
outside the scope of this rulemaking.
    FNS considered all comments received and determined that these 
comments did not warrant any changes to the requirements established by 
the interim rule, or were outside the scope of the interim rule. FNS is 
issuing the interim rule as final without revision.

III. Procedural Matters

Executive Order 12866

    This rule has been determined to be non-significant and is not 
subject to review by the Office of Management and Budget under 
Executive Order 12866.

Regulatory Flexibility Act

    This rule has been reviewed with regard to the requirements of the 
Regulatory Flexibility Act (5 U.S.C. 601-612). Implementation of this 
rule is not expected to impose a significant economic impact on a 
substantial number of small entities. No later than the beginning of 
School Year 2006-2007, SFAs were required by section 102 of Public Law 
108-265 to ensure that any existing or new vending contracts did not 
include provisions that restrict the sale or marketing of fluid milk. 
Therefore, the number of SFAs expected to be impacted by this rule is 
minimal.

[[Page 38890]]

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, the 
Department generally must prepare a written statement, including a 
cost/benefit analysis, for proposed and final rules with Federal 
mandates that may result in expenditures to State, local, or tribal 
governments in the aggregate, or to the private sector, of $100 million 
or more in any one year. When such a statement is needed for a rule, 
section 205 of the UMRA generally requires the Department to identify 
and consider a reasonable number of regulatory alternatives and adopt 
the least costly, more cost-effective or least burdensome alternative 
that achieves the objectives of the rule.
    This rule contains no Federal mandates (under the regulatory 
provisions of Title II of the UMRA) that impose costs on State, local, 
or tribal governments or to the private sector of $100 million or more 
in any one year. This rule is, therefore, not subject to the 
requirements of sections 202 and 205 of the UMRA.

Executive Order 12372

    The National School Lunch Program is listed in the Catalog of 
Federal Domestic Assistance under No. 10.555. For the reasons set forth 
in the final rule in 7 CFR part 3015, Subpart V and related Notice [48 
FR 29115, June 24, 1983], this program is included in the scope of 
Executive Order 12372, which requires intergovernmental consultation 
with State and local officials.
    Since the NSLP is a State-administered, federally funded program, 
FNS headquarters and regional office staff have ongoing formal and 
informal discussions with State and local officials regarding program 
implementation and policy issues. This arrangement allows State and 
local agencies to provide feedback that contributes to any 
discretionary decisions made in establishing requirements for rules 
that govern the NSLP.

Executive Order 13132

    Executive Order 13132 requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. 
Where such actions have federalism implications, agencies are directed 
to provide a statement for inclusion in the preamble to the regulations 
describing the agency's considerations in terms of the three categories 
called for under section (6)(b)(2)(B) of Executive Order 13132. FNS has 
considered the impact of this rule on State and local governments and 
has determined that this rule does not have federalism implications. 
This rule does not impose substantial or direct compliance costs on 
State and local governments. Therefore, under section 6(b) of the 
Executive Order, a federalism summary impact statement is not required.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is intended to have preemptive effect with 
respect to any State or local laws, regulations, or policies which 
conflict with its provisions or which would otherwise impede its full 
implementation. This rule is not intended to have retroactive effect. 
Prior to any judicial challenge to the provisions of this rule or the 
application of its provisions, all applicable administrative procedures 
under Sec.  210.18(q) or Sec.  235.11(f) must be exhausted.

Civil Rights Impact Analysis

    Under USDA Regulation 4300-4, ``Civil Rights Impact Analysis,'' FNS 
has reviewed this final rule to identify and address any major civil 
rights impacts the rule might have on children on the basis of age, 
race, color, national origin, sex or disability. After a careful review 
of the rule's intent and provisions, FNS has determined that this rule 
does not affect the participation of protected individuals in the Child 
Nutrition Programs. FNS found no factors that would negatively and 
disproportionately affect any group of individuals.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; see 5 CFR 
1320) requires that the Office of Management and Budget (OMB) approve 
all collections of information by a Federal agency from the public 
before they can be implemented. Respondents are not required to respond 
to any collection of information unless it displays a current valid OMB 
control number. This rule does not contain any information collection 
requirements subject to approval by OMB under the Paperwork Reduction 
Act of 1995.

E-Government Act Compliance

    The FNS is committed to complying with the E-Government Act of 
2002, to promote the use of the Internet and other information 
technologies to provide increased opportunities for citizen access to 
Government information and services, and for other purposes.

List of Subjects in 7 CFR Part 210

    Grant programs--education, Grant programs--health, Infants and 
children, Nutrition, Penalties, Reporting and recordkeeping 
requirements, School breakfast and lunch programs, Surplus agricultural 
commodities.

PART 210--NATIONAL SCHOOL LUNCH PROGRAM

0
Accordingly, the interim rule amending 7 CFR Part 210 which was 
published at 70 FR 70031 on November 21, 2005, is adopted as a final 
rule without change.

    Dated: July 29, 2009.
Julia Paradis,
Administrator, Food and Nutrition Service.
[FR Doc. E9-18690 Filed 8-4-09; 8:45 am]
BILLING CODE 3410-30-P


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