Federal Register / Vol. 78, No. 246 / Monday, December 23, 2013 / Rules and Regulations 77329 

production research, post-harvest 

research, and industry communications. 

In comparison, budgeted expenses for 

these items for the 2012–13 marketing 

year were $797,000, $119,000, $219,000, 

and $7,705,000, respectively. 

The Board recommended the 

increased assessment rate because the 

rate currently in effect would not 

generate sufficient revenue to meet its 

budgeted expenses. The increased 

assessment rate applied to estimated 

assessable walnuts in the 2013–14 

marketing year is expected to generate 

sufficient revenue to meet expenses, 

when combined with funds from the 

financial reserve and grant funds from 

FAS. 

Prior to arriving at this budget, the 

Board considered alternative 

expenditure levels but ultimately 

decided that the recommended levels 

were reasonable to properly administer 

the order. 

According to the National 

Agricultural Statistical Service (NASS), 

the season average grower prices for the 

years 2010 and 2011 were $2,040 and 

$2,900 per ton, respectively. These 

prices provide a range within which the 

2013–14 season average prices could 

fall. Dividing these average grower 

prices by 2,000 pounds per ton provides 

an inshell price per pound range of 

$1.02 to $1.45. Dividing these inshell 

prices per pound by the 0.45 conversion 

factor (inshell to kernelweight) 

established in the order, yields a 2013– 

14 price range estimate of $2.27 to $3.22 

per kernelweight pound of 

merchantable walnuts. 

Utilizing these estimates and the 

assessment rate of $0.0189 per 

kernelweight pound, estimated 

assessment revenue as a percentage of 

total estimated grower revenue should 

likely range between 0.59 and 0.83 

percent for the 2013–14 marketing year 

(assessment rate divided by price per 

kernelweight pound). 

This action increases the assessment 

obligation imposed on handlers. While 

assessments impose some additional 

costs on handlers, the costs are minimal 

and uniform on all handlers. Some of 

the additional costs may be passed on 

to growers. However, these costs are 

offset by the benefits derived from the 

operation of the marketing order. In 

addition, the Board’s meeting was 

widely publicized throughout the 

California walnut industry. All 

interested persons were invited to 

attend the meeting and participate in 

Board deliberations on all issues. Like 

all Board meetings, the June 6, 2013, 

meeting was a public meeting. All 

entities, both large and small, were able 

to express their views on this issue. 

In accordance with the Paperwork 

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

Chapter 35), the order’s information 

collection requirements have been 

previously approved by the Office of 

Management and Budget (OMB) and 

assigned OMB No. 0581–0178 (Walnuts 

Grown in California). No changes in 

those requirements as a result of this 

action are necessary. Should any 

changes become necessary, they would 

be submitted to OMB for approval. 

This rule imposes no additional 

reporting or recordkeeping requirements 

on either small or large California 

walnut handlers. As with all Federal 

marketing order programs, reports and 

forms are periodically reviewed to 

reduce information requirements and 

duplication by industry and public 

sector agencies. As noted in the initial 

regulatory flexibility analysis, USDA 

has not identified any Federal rules that 

duplicate, overlap, or conflict with this 

final rule. 

AMS is committed to complying with 

the E-Government Act, to promote the 

use of the internet and other 

information technologies to provide 

more opportunities for citizens to access 

Government information and services, 

and for other purposes. 

A proposed rule concerning this 

action was published in the Federal 

Register on September 17, 2013 (78 FR 

57101). Copies of the proposed rule 

were also made available to all walnut 

handlers by Board staff. Finally, the 

proposal was made available through 

the internet by the USDA and the Office 

of Federal Register. A 30-day comment 

period ending October 17, 2013, was 

provided for interested persons to 

respond to the proposal. One comment 

was received. The commenter raised a 

question about the effect of this action 

in regard to black walnut trees. Black 

walnut trees aren’t regulated by the 

marketing order; therefore, no changes 

will be made to the rule as proposed. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at: www.ams.usda.gov/

MarketingOrderSmallBusinessGuide. 

Any questions about the compliance 

guide should be sent to Jeffrey Smutney 

at the previously mentioned address in 

the FOR FURTHER INFORMATION CONTACT

section. 

After consideration of all relevant 

material presented, including the 

information and recommendation 

submitted by the Board and other 

available information, it is hereby found 

that this rule, and hereinafter set forth, 

will tend to effectuate the declared 

policy of the Act. 

Pursuant to 5 U.S.C. 553, it also found 

and determined that good cause exists 

for not postponing the effective date of 

this rule until 30 days after publication 

in the Federal Register because: (1) The 

2013–14 marketing year began on 

September 1, 2013, and the marketing 

order requires that the rate of 

assessment for each marketing year 

apply to all merchantable walnuts 

handled during the year; (2) the Board 

needs to have sufficient funds to pay its 

expenses, which are incurred on a 

continuous basis; and (3) handlers are 

aware of this action, which was 

unanimously recommended by the 

Board at a public meeting and is similar 

to other assessment rate actions issued 

in past years. Also, a 30-day comment 

period was provided for in the proposed 

rule. 

List of Subjects in 7 CFR Part 984 

Marketing agreements, Nuts, 

Reporting and recordkeeping 

requirements, Walnuts. 

For the reasons set forth in the 

preamble, 7 CFR part 984 is amended as 

follows: 

PART 984—WALNUTS GROWN IN 

CALIFORNIA 

■ 1. The authority citation for 7 CFR 

part 984 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Section 984.347 is revised to read 

as follows: 

§ 984.347 Assessment rate. 

On and after September 1, 2013, an 

assessment rate of $0.0189 per 

kernelweight pound is established for 

California merchantable walnuts. 

Dated: December 17, 2013. 

Rex A. Barnes, 

Associate Administrator, Agricultural 

Marketing Service. 

[FR Doc. 2013–30414 Filed 12–20–13; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 1217 

[Document Number AMS–FV–13–0038] 

Softwood Lumber Research, 

Promotion, Consumer Education and 

Industry Information Order; Changes 

to the Membership of the Softwood 

Lumber Board 

AGENCY: Agricultural Marketing Service. 

ACTION: Final rule. 


tkelley on DSK3SPTVN1PROD with RULES
77330 Federal Register / Vol. 78, No. 246 / Monday, December 23, 2013 / Rules and Regulations 

SUMMARY: This rule changes the 

membership of the Softwood Lumber 

Board (Board) established under the 

Softwood Lumber Research, Promotion, 

Consumer Education and Industry 

Information Order (Order). The Board 

administers the Order with oversight by 

the U.S. Department of Agriculture 

(USDA). Under the Order, assessments 

are collected from U.S. manufacturers 

(domestic) and importers and used for 

projects to promote softwood lumber 

within the United States. This rule 

revises the Board’s membership to 

reflect the diversity of the industry in 

terms of size of operation; allows 

companies that operate in multiple 

geographic regions to seek 

representation in any region in which 

they operate (U.S. or import); adds 

flexibility for the Board to nominate 

eligible persons to fill vacancies that 

occur during a term; and re-designates 

the States of Virginia and West Virginia 

to the U.S. South Region. These changes 

will help facilitate program operations. 

DATES: Effective Date: December 24, 

2013. 

FOR FURTHER INFORMATION CONTACT: 

Maureen T. Pello, Marketing Specialist, 

Promotion and Economics Division, 

Fruit and Vegetable Program, AMS, 

USDA, P.O. Box 831, Beavercreek, 

Oregon 97004; telephone: (503) 632– 

8848; facsimile (503) 632–8852; or 

electronic mail: Maureen.Pello@

ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This rule 

is issued under the Order. The Order is 

authorized under the Commodity 

Promotion, Research, and Information 

Act of 1996 (1996 Act) (7 U.S.C. 7411– 

7425). 

Executive Orders 12866 and 13563 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts and equity). 

Executive Order 13563 emphasizes the 

importance of quantifying both costs 

and benefits, reducing costs, 

harmonizing rules and promoting 

flexibility. This action has been 

designated as a ‘‘non-significant 

regulatory action’’ under section 3(f) of 

Executive Order 12866. Accordingly, 

the Office of Management and Budget 

(OMB) has waived the review process. 

Executive Order 13175 

This action has been reviewed in 

accordance with the requirements of 

Executive Order 13175, Consultation 

and Coordination with Indian Tribal 

Governments. The review reveals that 

this regulation will not have substantial 

and direct effects on Tribal governments 

and will not have significant Tribal 

implications. 

Executive Order 12988 

This rule has been reviewed under 

Executive Order 12988, Civil Justice 

Reform. It is not intended to have 

retroactive effect. Section 524 of the 

1996 Act (7 U.S.C. 7423) provides that 

it shall not affect or preempt any other 

Federal or State law authorizing 

promotion or research relating to an 

agricultural commodity. 

Under section 519 of the 1996 Act (7 

U.S.C. 7418), a person subject to an 

order may file a written petition with 

USDA stating that an order, any 

provision of an order, or any obligation 

imposed in connection with an order, is 

not established in accordance with the 

law, and request a modification of an 

order or an exemption from an order. 

Any petition filed challenging an order, 

any provision of an order, or any 

obligation imposed in connection with 

an order, shall be filed within two years 

after the effective date of an order, 

provision, or obligation subject to 

challenge in the petition. The petitioner 

will have the opportunity for a hearing 

on the petition. Thereafter, USDA will 

issue a ruling on the petition. The 1996 

Act provides that the district court of 

the United States for any district in 

which the petitioner resides or conducts 

business shall have the jurisdiction to 

review a final ruling on the petition, if 

the petitioner files a complaint for that 

purpose not later than 20 days after the 

date of the entry of USDA’s final ruling. 

Background 

This rule changes the Board’s 

membership provisions under the 

Order. The Board administers the Order 

with oversight by USDA. Under the 

Order, assessments are collected from 

U.S. manufacturers and importers and 

used for projects to promote softwood 

lumber within the United States. This 

rule revises the Board’s membership to 

reflect the diversity of the industry in 

terms of size of operation; allow 

companies that operate in multiple 

regions to seek representation in any 

region in which they operate (U.S. or 

import); add flexibility for the Board to 

nominate eligible persons to fill 

vacancies that occur during a term; and 

re-designate the States of Virginia and 

West Virginia to the U.S. South Region. 

These changes will help facilitate 

program operations and were 

unanimously recommended by the 

Board in July 2013. 

Pursuant to section 1217.40(b), the 

Board is composed of 18 or 19 members, 

depending upon whether an additional 

importer member is appointed to the 

Board. Twelve members are domestic 

manufacturers and six members are 

importers of softwood lumber from 

Canada. Of the 12 domestic 

manufacturers, 6 represent the U.S. 

South, 5 represent the U.S. West and 1 

represents the Northeast and Lake 

States. Of the six Canadian importers, 

four represent Canada West and two 

represent Canada East. An additional 

importer member may be appointed to 

represent all other importing countries 

besides Canada. Section 1217.40(c)(2) 

provides authority for the Board to 

recommend changes to its membership 

and nomination process. 

The Board met on May 7 and 8, 2013, 

and reviewed program operations, 

including the Board’s structure and 

nomination process. The Board 

reviewed these issues further and made 

the following four recommendations in 

July 2013. 

Board Diversity and Size of Operation 

The Board recommended that its 

regional membership be revised to 

reflect the diversity of the industry in 

terms of size of operation. About 8 

percent of the companies covered under 

the Order account for the top two-thirds 

of the total annual volume of assessable 

softwood lumber (both domestic and 

imports). These companies are 

considered large by the industry in 

terms of size of operation. Some of these 

companies operate in multiple regions 

and some are both a domestic 

manufacturer and an importer of 

softwood lumber. Ninety-two percent of 

the companies covered under the Order 

account for the remaining one-third of 

the total annual volume of assessable 

softwood lumber. These are considered 

small by the industry in terms of size of 

operation. 

The Board wants to ensure that this 

diversity is reflected within each region. 

The Board analyzed each region’s 

volume of assessable softwood lumber 

in relation to the region’s volume 

attributed to small and large companies. 

Table 1 below shows this analysis based 

on 3-year average data (2010–2012). 


tkelley on DSK3SPTVN1PROD with RULES
Federal Register / Vol. 78, No. 246 / Monday, December 23, 2013 / Rules and Regulations 77331 

TABLE 1—REGIONAL ANALYSIS OF ASSESSABLE SOFTWOOD LUMBER BY SIZE OF OPERATION

Region Assessable volume 

(billion board feet) 

Large companies Small 

companies 

Regional volume 

(billion board feet) 

Regional 

volume 

(billion board 

feet) 

U.S. South ................................................................................................... 10.436 5.951 (57%) 4.485 (43%) 

U.S. West ..................................................................................................... 10.548 8.017 (76%) 2.511 (24%) 

NE. and Lake States ................................................................................... 0.749 0.229 (31%) 0.520 (69%) 

Canada West ............................................................................................... 4.983 3.919 (79%) 1.064 (21%) 

Canada East ................................................................................................ 2.379 1.315 (55%) 1.064 (45%) 

* These figures are an average of data from 2010–2012. 2012 is actual Board assessment data from its first year of operation. 2010 and 2011 

Canadian data is from U.S. Customs and Border Protection. 2010 and 2011 U.S. data is from Forest Economic Advisors. 

It is noted that for the U.S. South, 

while the majority of the volume of 

assessable softwood lumber is attributed 

to large companies, almost 90 percent of 

the number of companies operating in 

this region are small. The Board 

considered this in its recommended 

distribution of Board seats as shown in 

Table 2 below. 

TABLE 2—ALLOCATION OF BOARD SEATS BASED ON SIZE OF OPERATION

Size of operation 

Number of seats 

U.S. South U.S. West NE. and lake states Canada 

east 

Canada 

west Non-Canadian importer 

Large companies .................... 2 4 ........................................ 1 3 

Small companies ..................... 4 1 N/A ................................. 1 1 N/A 

6 5 1 ..................................... 2 4 1 

* The Northeast and Lake States member and non-Canadian importer member may represent companies of any size. 

Additionally, if there were no eligible 

nominees for a large or small seat within 

a region, that seat may be filled by a 

nominee representing a company of any 

size. Should a company’s size change 

during a member’s term of office, that 

member may serve for the remainder of 

the term to which they were appointed. 

Section 1217.40(b) is revised 

accordingly. Modifications have been 

made in this final rule to clarify that the 

changes to paragraphs (a) and (b) in 

section 1217.40 will become effective 

for the term of office beginning January 

1, 2015. 

Further, section 1217.40(c) requires 

the Board to periodically review the 

geographic distribution of the volume of 

softwood lumber manufactured and 

shipped within the United States by 

domestic manufacturers and the volume 

of softwood lumber imported into the 

United States. This section is revised to 

require the Board to also periodically 

review the distribution of seats based on 

size of operation and recommend 

changes as necessary. Section 1217.40(c) 

is revised accordingly. 

Entities That Operate in Multiple 

Regions (U.S. and/or Import) 

Currently, section 1217.41(b)(3) 

provides that nominees that are both a 

domestic manufacturer and importer 

may seek nomination to the Board as 

either a domestic manufacturer or an 

importer, but not both. Nominees who 

domestically manufacture the majority 

of their softwood lumber must seek 

representation as a domestic 

manufacturer and nominees who import 

the majority of their softwood lumber 

must seek representation as an importer. 

Section 1217.41(b)(4) provides that 

domestic manufacturers who 

manufacture and domestically ship from 

more than one U.S. region must seek 

representation in the region of the 

majority of their softwood lumber. 

Further, section 1217.41(b)(5) provides 

that importers who import from more 

than one Canadian region must seek 

representation in the region from which 

they import the majority of their 

softwood lumber. 

As previously mentioned some 

entities in the softwood lumber industry 

are both domestic manufacturers and 

importers and operate in multiple 

regions under the Order. Industry 

members would like the flexibility to 

choose which region they represent and 

whether they seek a position as a 

domestic manufacturer or an importer 

on the Board. Thus, the Board 

recommended revising the Order so that 

entities that are U.S. manufacturers and 

importers and who may operate in 

multiple regions have the ability to seek 

representation in any region in which 

they operate. This will add flexibility to 

the nomination process by allowing 

companies to seek representation in 

their region of choice. Paragraphs (3), (4) 

and (5) of section 1217.41(b) are revised 

accordingly. 

Vacancies That Occur Mid-Term 

Section 1217.43(c) currently specifies 

that if a position becomes vacant, 

nominations to fill the vacancy be 

conducted using the nomination process 

set forth in the Order (section 

1217.41(b)) whereby the Board solicits 

the names of eligible nominees and then 

conducts regional elections. The process 

is lengthy and can result in a seat 

remaining vacant for an extended period 

of time. Thus, the Board recommended 

revising the Order to allow the Board 

the flexibility to nominate eligible 

persons to fill vacancies that occur 

during a term. This will facilitate 

program operations by helping to ensure 

that vacancies are filled in a timely 

manner. Section 1217.43(c) is revised 

accordingly. 

Virginia and West Virginia 

Currently, section 1217.40(b)(1)(iii) 

specifies that the States of Virginia and 

West Virginia are included as part of the 

Northeast and Lake States Region under 

the Order. However, softwood lumber 

from Virginia and West Virginia is 


tkelley on DSK3SPTVN1PROD with RULES
77332 Federal Register / Vol. 78, No. 246 / Monday, December 23, 2013 / Rules and Regulations 

1Price data was obtained from Random Lengths 

Publications, Inc., and is a framing composite price 

that is designed as a broad measure of price 

movement in the lumber market 

(www.randomlengths.com). 

2Percentages were obtained from the American 

Lumber Standard Committee, Inc. (ALSC). The 

ALSC administers an accreditation program for the 

grade marking of lumber produced under the 

American Softwood Lumber Standard (Voluntary 

Product Standard 20). This information is also 

confirmed by Board data. 

predominately pine, a much different 

species from the white spruce and red 

pine in the Northeast and Lake States, 

respectively. Thus, the Board 

recommended that the Order be revised 

to re-designate the States of Virginia and 

West Virginia as part of the U.S. South. 

The volume of softwood lumber from 

Virginia and West Virginia is relatively 

small (284 million board feet in 2012), 

so this change will have no impact on 

the regional distribution of seats on the 

Board. This change will align Virginia 

and West Virginia with the region in 

which they have more in common. 

Section 1217.40(b)(1)(iii) is revised 

accordingly. 

This rule also makes two minor 

changes to the Order. In paragraph (b) 

of section 1217.70 on reports, the last 

sentence is modified to specify that 

importers who pay their assessments 

directly to the Board must submit their 

report that accompanies the payment of 

collected assessments within 30 

calendar days after the end of the 

quarter in which the softwood lumber 

was imported as opposed to 30 calendar 

days after importation. This language 

was inadvertently omitted from the final 

rule that implemented the Order (76 FR 

46185; August 2, 2012) and will correct 

the Order provisions to be in line with 

current industry practices. This rule 

also changes the OMB control number 

in section 1217.108 from 0581–NEW to 

0581–0264, the control number assigned 

by the OMB. 

Final Regulatory Flexibility Act 

Analysis 

In accordance with the Regulatory 

Flexibility Act (RFA) (5 U.S.C. 601– 

612), AMS is required to examine the 

impact of the rule on small entities. 

Accordingly, AMS has considered the 

economic impact of this action on small 

entities. 

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. The Small 

Business Administration defines, in 13 

CFR part 121, small agricultural 

producers as those having annual 

receipts of no more than $750,000 and 

small agricultural service firms 

(domestic manufacturers and importers) 

as those having annual receipts of no 

more than $7.0 million. 

According to the Board, it is estimated 

that there are currently about 446 

domestic manufacturers of softwood 

lumber in the United States. This 

number represents separate business 

entities; one business entity may 

include multiple sawmills. Using an 

average price of $322 per thousand 

board feet,1 a domestic manufacturer 

who ships less than about 25 million 

board feet per year would be considered 

a small entity. Using 2012 data, it is 

estimated that about 270 domestic 

manufacturers, or about 60 percent 2, 

ship less than 25 million board feet 

annually. 

Likewise, based on data from U.S. 

Customs and Border Protection 

(Customs) and the Board, it is estimated 

there are currently about 767 importers 

of softwood lumber. Using 2012 

Customs data, about 699 importers, or 

about 91 percent, import less than $7.0 

million worth of softwood lumber 

annually. Thus, for purposes of the 

RFA, the majority of domestic 

manufacturers and importers of 

softwood lumber would be considered 

small entities. 

Regarding value of the commodity, 

with domestic production averaging 

about 28.5 billion board feet in 2012, 

and using an average price of $322 per 

thousand board feet, the average annual 

domestic value for softwood lumber is 

about $9.2 billion. According to 

Customs data, the average annual value 

for softwood lumber imports for 2012 is 

about $3.5 billion. 

This rule makes four changes to the 

Order regarding the Board’s 

membership. Paragraphs (1) and (2) of 

section 1217.40(b) are revised to reflect 

the diversity of the industry in terms of 

size of operation; paragraph 1217.40(c) 

is revised to require the Board to 

periodically review this distribution. 

Paragraphs (3), (4) and (5) of section 

1217.41(b) are revised to allow 

companies that operate in multiple 

regions to seek representation in any 

region in which they operate. Section 

1217.43(c) is revised to add flexibility 

for the Board to nominate eligible 

persons to fill vacancies that occur 

during a term. Section 1217.40(b)(1)(iii) 

is revised to re-designate the States of 

Virginia and West Virginia to the U.S. 

South Region. These changes were 

unanimously recommended by the 

Board and are authorized under section 

1217.40(c) of the Order and section 

515(b)(3) of the 1996 Act. 

Regarding the economic impact of this 

rule on affected entities, these changes 

are administrative in nature and have no 

economic impact on entities covered 

under the program. These changes will 

help maintain the Board’s balance in 

terms of size of operation by geographic 

region; add flexibility so that multiregion companies may choose which 

region they represent on the Board; help 

ensure that mid-term vacancies are 

filled in a timely manner; and better 

align the States of Virginia and West 

Virginia. 

Regarding alternatives, the Board 

explored various options regarding the 

diversity of size of operation. The Board 

considered establishing a separate 

region for multi-region companies and 

companies that are both a domestic 

manufacturer and an importer. The 

Board also considered establishing some 

‘‘at large’’ seats for multi-region 

companies. The Board considered 

weighting an entity’s vote in a regional 

election by volume. The Board also 

considered maintaining the status quo 

and not changing the Order in this 

regard. After much deliberation, the 

Board opted to recommend allocating 

regional seats based on an analysis of 

the volume of softwood lumber within 

each region and the volume of 

assessable softwood lumber covered 

under the Order. 

The Board considered maintaining the 

status quo regarding multi-region 

companies who may also be a domestic 

manufacturer and importer, filling midterm vacancies and the regional 

designation for the States of Virginia 

and West Virginia. The Board ultimately 

recommended modifications to these 

Order provisions. 

In accordance with the Paperwork 

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

Chapter 35), the information collection 

and recordkeeping requirements that are 

imposed by the Order have been 

approved previously under OMB 

control number 0581–0264. This rule 

imposes no additional reporting and 

recordkeeping burden on domestic 

manufacturers and importers of 

softwood lumber. 

As with all Federal promotion 

programs, reports and forms are 

periodically reviewed to reduce 

information requirements and 

duplication by industry and public 

sector agencies. Finally, USDA has not 

identified any relevant Federal rules 

that duplicate, overlap, or conflict with 

this rule. 

AMS is committed to complying with 

the E-Government Act, 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. 


tkelley on DSK3SPTVN1PROD with RULES
Federal Register / Vol. 78, No. 246 / Monday, December 23, 2013 / Rules and Regulations 77333 

Regarding outreach efforts, these 

actions were discussed by the Board at 

meetings on May 7 and 8, 2013. The 

Board’s Executive Committee discussed 

these issues on January 7, June 3 and 10, 

and July 1, 2013. All of the Board’s 

meetings, including meetings held via 

teleconference, are open to the public 

and interested persons are invited to 

participate and express their views. 

A proposed rule concerning this 

action was published in the Federal 

Register on September 25, 2013 (78 FR 

58956). The Board mailed copies of the 

rule to all known domestic 

manufacturers and importers of 

softwood lumber. The Board included 

notifications about the proposed rule in 

its newsletters and on its Web site at 

softwoodlumberboard.org. Finally, the 

proposal was made available through 

the Internet by USDA and the Office of 

the Federal Register. A 30-day comment 

period ending October 25, 2013, was 

provided to allow interested persons to 

submit comments. 

Analysis of Comments 

Six comments were received in 

response to the proposed rule, all 

supporting the proposal. In summary, 

the commenters concurred that revising 

the Board’s membership to reflect the 

diversity of the industry by size of 

operation will help ensure that the 

Board reflects the make-up of the 

industry and provide for fair 

representation. Allowing entities that 

operate in multiple regions to choose 

the region they would like to represent 

provides flexibility and may also 

facilitate greater interest in serving on 

the Board and Board activities. One 

commenter opined that allowing the 

Board the ability to nominate candidates 

to fill vacancies that occur mid-term 

would save costs since the Board would 

not have to engage in a lengthy 

nomination process. Three commenters 

stated that switching the States of 

Virginia and West Virginia to the U.S. 

South Region was appropriate. 

After consideration of all relevant 

matters presented, including the 

information and recommendation 

submitted by the Board and other 

available information, it is hereby found 

that this rule, as hereinafter set forth, is 

consistent with and will effectuate the 

purposes of the 1996 Act. 

It is further found that good cause 

exists for not postponing the effective 

date of this rule until 30 days after 

publication in the Federal Register (5 

U.S.C.) because this action needs to be 

in effect as soon as possible to allow 

sufficient time for completion of the 

nomination process and appointments 

for the term of office beginning January 

1, 2015. Additionally, a 30-day 

comment period was provided for in the 

proposed rule, and all six comments 

supported the proposed changes. 

List of Subjects in 7 CFR Part 1217 

Administrative practice and 

procedure, Advertising, Consumer 

information, Marketing agreements, 

Softwood lumber promotion, Reporting 

and recordkeeping requirements. 

For the reasons set forth in the 

preamble, 7 CFR part 1217 is amended 

as follows: 

PART 1217—SOFTWOOD LUMBER 

RESEARCH, PROMOTION, 

CONSUMER EDUCATION AND 

INDUSTRY INFORMATION ORDER 

■ 1. The authority citation for 7 CFR 

part 1217 continues to read as follows: 

Authority: 7 U.S.C. 7411–7425; 7 U.S.C. 

7401. 

■ 2. Amend § 1217.40 by: 

■ a. Revising paragraph (a); 

■ b. Revising paragraphs (b)(1), (b)(2) 

introductory text, (b)(2)(i), and (b)(2)(ii); 

■ c. Revising the introductory text to 

paragraph (c) and paragraph (c)(2) and 

adding a new paragraph (c)(3) 

The changes to read as follows: 

§ 1217.40 Establishment and membership. 

(a) Establishment of the Board. There 

is hereby established a Softwood 

Lumber Board to administer the terms 

and provisions of this Order and 

promote the use of softwood lumber. 

The Board shall be composed of 

manufacturers for the U.S. market who 

manufacture and domestically ship or 

import 15 million board feet or more of 

softwood lumber in the United States 

during a fiscal period. Seats on the 

Board shall be apportioned based on the 

volume of softwood lumber 

manufactured and shipped within the 

United States by domestic 

manufacturers and the volume of 

softwood lumber imported into the 

United States. Commencing with the 

term of office beginning January 1, 2015, 

seats on the Board shall also be 

apportioned based on size of operation 

within each geographic region, as 

specified in paragraphs (b)(1)(i), 

(b)(1)(ii), (b)(2)(i), and (b)(2)(ii) of this 

section. For purposes of this section, 

large means manufacturers for the U.S. 

market who account for the top twothirds of the total annual volume of 

assessable softwood lumber and small 

means those who account for the 

remaining one-third of the total annual 

volume of assessable softwood lumber. 

If there are no eligible nominees for a 

large or small seat within a region, that 

seat may be filled by a nominee 

representing an eligible manufacturer 

for the U.S. market of any size. Should 

the size of a manufacturer for the U.S. 

market change during a member’s term 

of office, that member could serve for 

the remainder of the term. 

(b) * * * 

(1) Domestic manufacturers. Twelve 

members shall be domestic 

manufacturers from the following three 

regions: 

(i) Six members shall be from the U.S. 

South Region, which consists of the 

states of Alabama, Arkansas, Florida, 

Georgia, Louisiana, Mississippi, North 

Carolina, Oklahoma, South Carolina, 

Tennessee, Texas, Virginia and West 

Virginia. Commencing with the term of 

office beginning January 1, 2015, of 

these six members, two must be large 

and four must be small; 

(ii) Five members shall be from the 

U.S. West Region, which consists of the 

states of Alaska, Arizona, California, 

Colorado, Hawaii, Idaho, Montana, 

Nevada, New Mexico, North Dakota, 

Oregon, South Dakota, Utah, 

Washington and Wyoming. 

Commencing with the term of office 

beginning January 1, 2015, of these five 

members, four must be large and one 

must be small; and 

(iii) One member shall be from the 

Northeast and Lake States Region, 

which consists of the states of 

Connecticut, Delaware, Illinois, Indiana, 

Iowa, Kansas, Kentucky, Maine, 

Maryland, Massachusetts, Michigan, 

Minnesota, Missouri, Nebraska, New 

Hampshire, New Jersey, New York, 

Ohio, Pennsylvania, Rhode Island, 

Vermont, Wisconsin and all other parts 

of the United States not listed in 

paragraphs (b)(1)(i), (b)(1)(ii), or 

(b)(1)(iii) of this section. 

(2) Importers. Six members shall be 

importers who represent the following 

regions: 

(i) Four members shall import 

softwood lumber from the Canadian 

West Region, which consists of the 

provinces of British Columbia and 

Alberta. Commencing with the term of 

office beginning January 1, 2015, of 

these four members, three must be large 

and one must be small; and 

(ii) Two members shall import 

softwood lumber from the Canadian 

East Region, which consists of the 

Canadian territories and all other 

Canadian provinces not listed in 

paragraph (b)(2)(i) of this section that 

import softwood lumber into the United 

States. Commencing with the term of 

office beginning January 1, 2015, of 

these two members, one must be large 

and one must be small. 

* * * * * 


tkelley on DSK3SPTVN1PROD with RULES
77334 Federal Register / Vol. 78, No. 246 / Monday, December 23, 2013 / Rules and Regulations 

(c) In each five-year period, but not 

more frequently than once in each threeyear period, the Board shall: 

* * * * * 

(2) Review, based on a three-year 

average, the distribution of the size of 

operations within each region; and 

(3) If warranted, recommend to the 

Secretary the reapportionment of the 

Board membership to reflect changes in 

the geographical distribution of the 

volume of softwood lumber 

manufactured and shipped within the 

United States by domestic 

manufacturers and the volume of 

softwood lumber imported into the 

United States. The destination of 

volumes between regions and the 

distribution of the size of operations 

within regions shall also be considered. 

The number of Board members may also 

be changed. Any changes in Board 

composition shall be implemented by 

the Secretary through rulemaking. 

■ 3. Amend § 1217.41 by 

■ a. Revising the introductory text to 

paragraph (b); 

■ b. Revising paragraphs (b)(1), (b)(2), 

(b)(3), (b)(4), and (b)(5). 

The changes to read as follows: 

§ 1217.41 Nominations and appointments. 

* * * * * 

(b) Subsequent nominations shall be 

conducted as follows: 

(1) The Board shall conduct outreach 

to all segments of the softwood lumber 

industry. Softwood lumber domestic 

manufacturers and importers may 

submit nominations to the Board. 

Subsequent nominees must 

domestically manufacture and/or import 

15 million board feet or more of 

softwood lumber per fiscal year; 

(2) Domestic manufacturers and 

importer nominees may provide the 

Board a short background statement 

outlining their qualifications to serve on 

the Board; 

(3) Nominees that are both a domestic 

manufacturer and an importer may seek 

nomination to the Board and vote in the 

nomination process as either a domestic 

manufacturer or an importer, but not 

both. Such nominees must domestically 

manufacture and import 15 million 

board feet or more of softwood lumber 

per fiscal year; 

(4) The names of domestic 

manufacturer nominees shall be placed 

on a ballot by region. The ballots along 

with the background statements shall be 

mailed to domestic manufacturers in 

each respective region for a vote. 

Domestic manufacturers who 

manufacture softwood lumber in more 

than one region may seek nomination 

and vote in one region of their choice. 

The votes shall be tabulated for each 

region with the nominee receiving the 

highest number of votes at the top of the 

list in descending order by vote. The top 

two candidates for each position shall 

be submitted to the Secretary; 

(5) The names of importer nominees 

shall be placed on a ballot by region. 

The ballots along with the background 

statements shall be mailed to importers 

in each respective region for a vote. 

Importers who import softwood lumber 

from more than one region may seek 

nomination and vote in one region of 

their choice. The votes shall be 

tabulated for each region with the 

nominee receiving the highest number 

of votes at the top of the list in 

descending order by vote. The top two 

candidates for each position shall be 

submitted to the Secretary. 

* * * * * 

■ 4. Amend § 1217.43 by revising 

paragraph (c) to read as follows: 

§ 1217.43 Removal and vacancies. 

* * * * * 

(c) If a position becomes vacant, 

nominations to fill the vacancy may be 

conducted using the nominations 

process set forth in § 1217.41(b) or the 

Board may nominate eligible persons. A 

vacancy will not be required to be filled 

if the unexpired term is less than 6 

months. 

■ 5. Amend § 1217.70 by revising 

paragraph (b) to read as follows: 

§ 1217.70 Reports. 

* * * * * 

(b) For domestic manufacturers, such 

information shall accompany the 

collected payment of assessments on a 

quarterly basis specified in § 1217.52. 

For importers who pay their 

assessments directly to the Board, such 

information shall accompany the 

payment of collected assessments 

within 30 calendar days after the end of 

the quarter in which the softwood 

lumber was imported. 

■ 6. Section 1217.108 is revised to read 

as follows: 

§ 1217.108 OMB control number. 

The control number assigned to the 

information collection requirement in 

this subpart by the Office of 

Management and Budget pursuant to the 

Paperwork Reduction Act of 1995, 4 

U.S.C. is OMB control number 0581– 

0264. 

Dated: December 17, 2013. 

Rex A. Barnes, 

Associate Administrator. 

[FR Doc. 2013–30394 Filed 12–20–13; 8:45 am] 

BILLING CODE 3410–02–P 

SMALL BUSINESS ADMINISTRATION 

13 CFR Part 121 

RIN 3245–AG37 

Small Business Size Standards: 

Construction 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Final rule. 

SUMMARY: The United States Small 

Business Administration (SBA) is 

increasing two small business size 

standards in North American Industry 

Classification System (NAICS) Sector 

23, Construction, and retaining the 

current standards for the 30 remaining 

industries in that Sector. Specifically, 

SBA is increasing the size standards for 

NAICS 237210, Land Subdivision, from 

$7 million in average annual receipts to 

$25.5 million, and for Dredging and 

Surface Cleanup Activities, a subindustry category (or an ‘‘exception’’) 

under NAICS 237990, Other Heavy and 

Civil Engineering Construction, from 

$20 million to $25.5 million. As part of 

its ongoing comprehensive size 

standards review, SBA evaluated all size 

standards in NAICS Sector 23 to 

determine whether they should be 

retained or revised. 

DATES: This rule is effective January 22, 

2014. 

FOR FURTHER INFORMATION CONTACT: Carl 

Jordan, Program Analyst, Office of Size 

Standards, (202) 205–6618 or 

sizestandards@sba.gov. 

SUPPLEMENTARY INFORMATION: To 

determine eligibility for Federal small 

business assistance programs, SBA 

establishes small business size 

definitions (referred to as size 

standards) for private sector industries 

in the United States. The SBA’s existing 

size standards use two primary 

measures of business size, average 

annual receipts and number of 

employees. Financial assets, electric 

output and refining capacity are used as 

size measures for a few specialized 

industries. In addition, SBA’s Small 

Business Investment Company (SBIC), 

7(a), and Certified Development 

Company (CDC or 504) Loan Programs 

determine small business eligibility 

using either the industry based size 

standards or alternative net worth and 

net income size based standards. At the 

start of the current comprehensive 

review of size standards, there were 41 

different size standards levels, covering 

1,141 NAICS industries and 18 subindustry activities. Of these, 31 were 

based on average annual receipts, seven 

based on number of employees, and 


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