### United States

Department of Agriculture Anim al and Plant Health Inspection Service April 2011 Analysis in Support of Certification that the

Rule will not have a Significant Economic Impact on a Substantial Number of Small Entitie s

Final Rule APHIS 2010 - 0036 RIN 0579 - AD27
Amend 7 CFR Part 319 , Revision of Clementines from Spain Regulations

Policy & Program Development Policy Analysis & Developmenti



### Summary

The rule will amend the regulations governing the importation of c lementines from Spain by changing the number of clementines that are required to be sampled by APHI S inspec tors from “200 fruit” per consignment to “ a sample of clementines determined by APHIS ” per consignment based on level of risk . This action will allo w APHI S to determine a sample number based on the risk level of Mediterranean fruit fly without having to amend the regulations. By permitting the number of sampled clementines per consignment to vary , APHI S will have the flexibility to respond to changin g risk levels while continuing to provide protection against the introduction of quarantine pests. Under the current regulation, the percentage of sampled clementines ranges from 0.02 percent to 0.1 percent per consignment inspected. Even if inspection amounts are increased two or three times when there is a higher pest risk, the percentage of clementines sampled will remain negligible. This rule will not have a significant economic effect on producers of clementines or other U.S. entities, regar dless of their size or resources. As described, an increase in the number of fruit sampled due to pest risk level changes will have a negligible effect on the number of clementines imported from Spain. Under these circumstances, the Administrator of the Animal and Plant Health Inspection Service has determined that this action will not have a significant economic impact on a substantial number of small entities.1



### Introduction
This analy sis provides the basis, as required by the Regu latory

Flexibility

Act, for certification by

the APHIS Administrator that the rule will not have a significant economic impact on a substantial number of small entities. The rule will amend the regulations governing the importation of clementines from Spa in by changing the number of clementines that are required to be sampled by inspectors of
APHI S from “200 fruit” per consignment to “a sample of clementines determined by APHI S” per consignment based on level of risk. This action will allow APHI S to deter mine a sample number based on the risk level of Mediterranean fruit fly without having to amend the regulations. By

allowing the number of sampled clementines per consignment to vary , APHIS will have the flexibility

to respond to changing risk levels whil e continuing to provide protection against the introduction of quarantine pests. A consignment of clementines consists of one or more lots containing no more than a

c ombined total of 200,000 boxes of clementines that are presented to an inspector for
pre - treatment inspection. Under the current regulation, the percentage of sampled clementines ranges from 0.02 percent to 0.1 percent per consignment inspected. Even if inspection amounts are increased two or three times when there is a higher pest risk, the percentage of clementines sampled will remain negligible. While this rule will help reduce the risk of pest introduction, we are unable to quantify the economic impact of decreasing the probabilit y of introducing Medfl y into the United States. Medfly introductions can be very costl y to producers and to the Federal and State governments. The mean cost of eradicating six Medfly outbreaks in 2007 was $13.54 million.2



### Potential Impact on Small Entities
The 2007 Census of Agriculture classifies orange varieties other than Valencia oranges as “other orange” varieties. They include navels, tangerines, tangelos, temples, satsuma s, and other mandarin varieties, such as clementines. In 2007, there were 9,659 “other orange” operations, with Californ ia and Florida growers accounting for 89 percent of all U.S. operations, and the grove acreages in California and Florida accounting for 98 percent of the U.S. total. The Small Business Administration small

- entity standard for citrus (except orange) grove s is $750,000 or less in annual receipts. 1 Average annual sales per “other orange” grower are estimated to have been about $124,000 in 2009. 2 Clearly , “other orange” growers, including producers of clementines, are predominantly small entities. According to the 2007 Census of Agriculture, there were 12,017 small family citrus farms, including 1,453 limited resource citrus farms (table 1). 3 Small family citrus farms comprise about 77 percent of all citrus farms.

1 NAICS 111320. http://www.sba.gov/idc/groups/public/documents/sba_homepage/serv_sstd_tablepdf.pd f 2 Average sales per entity is based on the number of “other orange” grow ers recorded in the 2007 Census of Agriculture, i.e., 9,659 operations, and the total value of fresh and processed non

- Valencia oranges reported in the 2009 USDA

- NASS Citrus fruits 2 009 Summary, i.e., $1.2 billion. http://usda.mannlib.cornell.edu/usda/current/CitrFrui/CitrFrui

- 09

- 24

- 2009.pdf 3 USDA ERS. Structure and Finances of U.S. Family Farms: Family Farm Report, 2007 edition, EIB

- 24 Any farm where the operator and persons relate d to the operator own a majority of the business is considered a family farm. Sm all family farms have annual gross sales of less than $250,000. This category of farms is further divided into retirement farms (operators reporting they are retired, excludi ng limited resource farms), residential/ lifestyle farms (operators reporting a major occupation other than farming, excluding limited resource farms), and farming

- occupation farms (operators reporting farming as their major occupation). Farming

- occupatio n farms are further classified as low

- sales small family farms (gross sales less than $100,000, excluding limited resource farms) and high

- sales small family farms (gross sales between $100,000 and $249,000). Limited resource farms have (a) direct or indir ect gross farm sales of not more than $100,000 and (b) a total household income at or below the national poverty level for a family of four, or less than 50 percent of county median household income. By definition, limited resource farms qualify as small family farms, but they are identified as a separate category in the 2007 Census of Agriculture.3

Table 1. Number and percentage of limit ed resource and other small family citrus farms, 2007

Limited resource farms Retirement

farms Residential/

lifestyle farms Farming

occupation/ low er sales Farming

occupation/ higher sales Total small

family farms All citrus

farms Number of citrus farms 1, 453 3,567 4,866 1,639 492 12,017 15,658 Percentage of total citrus farms 9% 23% 31% 10% 3% 77% 100% Source: USDA NASS, 2007 Census of Agriculture The proposed rule proposed to amend the regulations governing the importation of clementines from Spain by removing from the regulations the specific number of clementines (200) per consignment intended for export to the United States that are required to be sampled by
APHI S inspectors

. In place of this number, we proposed that the number to be sampled would b e determined b y APH IS and included in the workplan agreement between APHI S and the Government of Spain. This change gives APHIS the flexibility to change the sample size as risk conditions warrant. As noted previously , even if inspection amounts are incr eased two or three times when there is a higher pest risk, the percentage of clementines sampled will remain negligible. This rule will not have a significant economic effect on producers of clementines or other U.S. entities, regardless of their size or r esources. As described, a change in the number of fruit sampled due to pest risk level changes will have a negligible effect on the number of clementines imported from Spain. Under these circumstances, the Administrator of the Anim al and Plant Health Inspection Service has determined that this action will not have a significant economic impact on a substantial number of small entities.