This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

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new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

34039

Vol. 65, No. 103

Friday, May 26, 2000

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 29

[Docket No. TB–00–10]

RIN 0581–AB87

Tobacco Fees and Charges for

Mandatory Inspection; Fee Increase

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Interim final rule with request

for comments.

SUMMARY: The Tobacco Inspection Act

requires the Secretary to fix and collect

fees and charges for inspection and

certification, and other services,

including administrative and

supervisory costs, at designated tobacco

auction markets in all tobacco

producing areas. The fees collected

must, as nearly as possible, cover the

Department’s costs of performing these

services and also maintain a reserve

sufficient to cover program financial

liabilities. This interim final rule will

increase the fee from $.0083 to $.0100

per pound to cover the increased cost of

operating the tobacco inspection

program and maintain the operating

reserve. The last increase in the fee was

in 1995. This increase does not affect

the fees for import, export, or

permissive tobacco inspection.

DATES: Effective May 30, 2000;

comments received by June 26, 2000,

will be considered prior to issuance of

a final rule.

ADDRESSES: Send comments to John P.

Duncan III, Deputy Administrator,

Tobacco Programs, Agricultural

Marketing Service (AMS), United States

Department of Agriculture (USDA), AG

0280, Room 502 Annex Building, PO

Box 96456, Washington, DC 20090–

6456. Comments will be made available

for public inspection at this location

during regular business hours.

FOR FURTHER INFORMATION CONTACT: John

P. Duncan III, Deputy Administrator,

Tobacco Programs, AMS, USDA, AG

0280, Room 502 Annex Building, PO

Box 96456, Washington, DC 20090–

6456; telephone: (202) 205–0567; Fax:

(202) 205–0235.

SUPPLEMENTARY INFORMATION:

A. Executive Order 12866

This rule has been determined to be

not significant for purposes of Executive

Order 12866, and therefore, has not

been reviewed by the Office of

Management and Budget.

B. Regulatory Flexibility Act

Pursuant to the requirements set forth

in the Regulatory Flexibility Act (5

U.S.C. 601 et seq.), full consideration

has been given to the potential

economic impact upon small business.

All tobacco warehouses and producers

fall within the confines of ‘‘small

business’’ which are defined by the

Small Business Administration (13 CFR

121.201) as those having annual receipts

of less than $500,000 and small

agricultural service firms are defined as

those whose annual receipts are less

than $3,500,000. There are

approximately 360 tobacco warehouses

and approximately 170,000 producers

and most warehouses and producers

may be classified as small entities. The

AMS has determined that this action

would not have a significant economic

impact on a substantial number of small

entities.

The Tobacco Inspection Act of 1935,

as amended, (7 U.S.C. 511–511q),

requires the Secretary to fix and collect

fees and charges for inspection and

certification of quota tobacco, and other

services, including administrative and

supervisory costs, at designated tobacco

auction markets in all tobacco

producing areas. The fees collected

must, as nearly as possible, cover the

Department’s costs of performing these

services.

The AMS annually reviews its user

fee programs to determine if the fees are

adequate. The most recent review

determined that the existing fee

schedule would result in significant

losses in crop years 2000 and 2001 and

leave the program with inadequate

reserve balances. Due to reductions in

tobacco quotas and increases in the sale

of tobacco through contract sales,

obligations for the 2000 crop-year are

estimated at $11,607,000 and revenues

are expected to reach only $6,843,000,

for a loss of $4,764,000 and a reduction

in the operating reserve to $4,738,000. If

the same level of service and fee

structure continues for the 2001 cropyear the estimated loss would exceed

$6,154,000 and the operating reserve

would drop to a negative $1,416,000.

The major items affecting obligations

are Federally mandated increases in

salaries and benefits, travel costs, and

other administrative costs. Revenue

depends on the amount of tobacco sold

on the designated auction markets.

Production quotas for tobacco were

reduced by 228.6 million pounds in

1998, 330.7 million pounds in 1999, and

318.7 million pounds in 2000. This is a

total decrease of 878 million pounds in

production quotas since 1997. The

amount of tobacco graded in 1998 was

1.56 billion pounds, 1.31 billion pounds

in 1999, and 938 million pounds is

estimated in 2000. Contract sales of

tobacco will further reduce the amount

graded by about 235 million pounds in

2000. Based on these figures, the current

fee level will not generate the amount of

revenue sufficient to maintain the level

of inspection services requested and

maintain funds in the program’s reserve

account. An analysis of available data

indicates that a fee of $.0100 per pound

effective for the 2000 crop-year would

increase revenue by $1,277,000 and

bring the operating reserve up to

$6,014,000. The requested fee increase

was recommended by the National

Advisory Committee for Tobacco

Inspection Services at its meeting on

April 20, 2000. This committee is made

up of representatives of producer

interest groups, appointed by the

Secretary of Agriculture, to advise on

the level of services and user fee rate.

This fee increase represents the

minimum level needed to cover costs

for the 2000 crop-year. In the future,

AMS will continue to review the

program to ensure that fees are

adequate. Accordingly, we believe that

the impact of the fee increase would not

be significant on users of the inspection

and certification services.

C. Civil Justice Reform

This rule has been reviewed under

Executive Order 12988, Civil Justice

Reform. This action is not intended to

34040 Federal Register / Vol. 65, No. 103 / Friday, May 26, 2000 / Rules and Regulations

have retroactive effect. This rule will

not preempt any State or local laws,

regulations, policies, unless they

present an irreconcilable conflict with

this rule. There are no administrative

procedures that must be exhausted prior

to any judicial challenge to the

provisions of this rule.

Background

The Secretary of Agriculture is

authorized by the Tobacco Inspection

Act of 1935, as amended, 7 U.S.C. 511–

511q et seq., to fix and collect fees and

charges for inspection and certification

of quota tobacco, and other services,

including administrative and

supervisory costs, at designated tobacco

auction markets in all tobacco

producing areas. The fees collected

must, as nearly as possible, cover the

Department’s costs of performing these

services.

The AMS regularly reviews programs

to determine if fees are adequate and if

costs are reasonable. This interim final

rule will increase the fees and charges

assessed by the AMS for the mandatory

inspection and certification of producer

tobacco sold at designated auction

markets throughout the tobacco

producing areas.

The AMS conducted a recent review

of the financial status of this program to

determine whether the fee is sufficient.

Revenue for the 1999 crop-year was

approximately $11,419,000. Obligations

for the period are approximately

$11,508,000. At the current fee level,

insufficient revenue would be generated

to meet the costs of the inspection

program and to replace funds that had

to be used from the program’s reserve

account. The major factors affecting

obligations are mandatory increases in

Federal salaries and benefits, travel

allowances, and other administrative

costs since 1995. An analysis of data

available to the AMS indicates that a fee

of $.0100 per pound would cover

expenses and maintain a reserve that

would meet any reasonable

contingency.

Due to an estimated 43 percent

reduction in tobacco to be inspected and

20–30 percent of tobacco being sold

through contract sales, obligations for

the 2000 crop-year are estimated at

$11,607,000 and revenues are expected

to reach only $6,843,000, for a loss of

$4,764,000 and a reduction in the

operating reserve to $4,738,000. If the

same level of service and fee structure

continues for the 2001 crop-year the

estimated loss would exceed $6,154,000

and the operating reserve would drop to

a negative $1,416,000.

Revenue depends on the amount of

tobacco sold on the designated auction

markets. Production quotas for tobacco

were reduced by 228.6 million pounds

in 1998, 330.7 million pounds in 1999,

and 318.7 million pounds in 2000. This

is a total decrease of 878 million pounds

of tobacco since 1997. Also, contract

sales of tobacco will further reduce the

amount graded by about 235 million

pounds in 2000. Based on these figures,

the current fee level will not generate

the amount of revenue sufficient to

maintain the level of inspection services

requested and maintain funds in the

program’s reserve account. An analysis

of available data indicates that a fee of

$.0100 per pound effective for the 2000

crop-year would increase revenue by

$1,277,000 and bring the operating

reserve up to $6,014,000.

Information on program income and

expenses was presented to the National

Advisory Committee for Tobacco

Inspection Services at its meeting on

February 17, 2000, in Raleigh, North

Carolina, and again on April 20, 2000,

in Washington, D.C. The National

Advisory Committee, which is made up

of 14 representatives from tobacco

producer interest groups and appointed

by the Secretary of Agriculture, was

established by law in 1981 to advise the

Secretary on the level of services needed

and the fees necessary to cover those

services. By a majority vote, the

Committee adopted a motion to

recommend to the Secretary an increase

in the fee to $.0100 per pound.

It is hereby found and determined

upon good cause that it is impracticable,

unnecessary, and contrary to the public

interest to give preliminary notice prior

to putting this rule into effect and 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 2000 flue-cured

marketing season will begin about July

17 and this action is needed, as soon as

possible, so as to treat all types of

tobacco on an equal basis for the 2000

crop-year; (2) the National Advisory

Committee recommended the fee

increase by a majority vote; and (3) this

interim final rule provides a 30-day

comment period, and all comments

timely received will be considered prior

to finalization of this rule.

List of Subjects in 7 CFR Part 29

Administrative practice and

procedure, Advisory committees,

Government publications, Imports,

Pesticides and pests, Reporting and

recordkeeping requirements, Tobacco.

For reasons set forth in the preamble,

7 CFR part 29 is amended as follows:

PART 29—TOBACCO INSPECTION

1. The authority citation for part 29,

subpart B continues to read as follows:

Authority: 7 U.S.C. 511m and 511r.

§ 29.123 [Amended]

2. In § 29.123, paragraph (a) is

amended by removing the words

‘‘$.0083 per pound’’ and adding the

words ‘‘$.0100 per pound’’ in their

place.

Dated: May 22, 2000.

Kathleen A. Merrigan,

Administrator, Agricultural Marketing

Service.

[FR Doc. 00–13290 Filed 5–25–00; 8:45 am]

BILLING CODE 3410–02–P

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 54

[Docket No. LS–98–12]

RIN 0581–AB83

Changes in Fees for Federal Meat

Grading and Certification Services

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Final rule.

SUMMARY: The Agricultural Marketing

Service (AMS) is revising the hourly fee

rates for voluntary Federal meat grading

and certification services. The hourly

fees will be adjusted by this final rule

to reflect the increased cost of providing

service, and ensure that the Federal

meat grading and certification program

is operated on a financially selfsupporting basis as required by law.

EFFECTIVE DATE: June 26, 2000.

FOR FURTHER INFORMATION CONTACT:

Larry R. Meadows, Chief, Meat Grading

and Certification (MGC) Branch (202)

720–1246.

SUPPLEMENTARY INFORMATION:

A. Executive Order 12866

This action has been determined to be

not significant for purposes of Executive

Order 12866, and has not been reviewed

by the Office of Management and

Budget (OMB).

B. Regulatory Flexibility

Pursuant to the requirements set forth

in the Regulatory Flexibility Act (RFA)

(5 U.S.C. 601 et seq.), the Administrator

of AMS has considered the economic

impact of this proposed action on small

entities.

AMS, through its MGC Branch,

provides voluntary Federal meat grading