### United States

Department of Agriculture Anim al and Plant Health Inspection Service Novem ber 2011 Final Regulatory Flexibility Analysis

Final Rule APHIS - 2008 - 0015 RIN 0579 - AC85 Citrus Greening and Asian Citrus Psyllid; Quarantine a nd Interstate Movement Regulations

Policy & Program Development Policy Analysis & Developmenti



### Table of Contents Introduction

................................ ................................ ................................ ......................... 2 Background

................................ ................................ ................................ ..................... 2 Final Regulatory

Flexibility

Anal ys is

................................ ................................ ................. 3 Need for and Objectives of the Rule

................................ ................................ ............... 3 Significant Issues raised by Public Comment in response to the Initial Regulatory Flexibility

Anal ys is

................................ ................................ ................................ ........ 4 Significant Issues raised by the Small Business Administration in response to the Initial Regulatory

Flexibility

Anal ys is

................................ ................................ ........... 4 Potentially

Affected Small Entities

................................ ................................ ................. 4 Projected Reporting, Recordkee ping, and Other Compliance Requirements

................. 9 Steps taken by

APHI S to minimize Significant Economic Impacts on Small Entities

.. 9ii



### Introduction The Animal and Plant Health I nspection Service (APHI S) is finalizing the interim rule which sought to amend the “Domestic Quarantine Notices” in Title 7, part 301 of the Code of Federal Regulations b y adding a new subpart 301.76 through 301.76

- 13, “Citrus Greening and Asian C itrus Psyllid,” hereafter referred to as the “final regulations.” The purpose of the interim rule was to prevent the spread of the harmful citrus disease known informally as citrus greening (also known as Huanglongbing disease of citrus) and its vector, the Asian citrus psy llid (ACP). The final regulations will impose citrus greening quarantine restrictions on the States of Florida, Georgia, Puerto Rico, the U.S. Virgin Islands, two parishes in L ouisiana , two counties in South Carolina , portions of one co unt y in Texas, and portions of two counties in California . The final regulations will also impose ACP quarantine restrictions on Alabama, Florida, Georgia, Guam, Hawaii, Louisiana, Mississippi, Puerto Rico, Texas, the U.S. Virgin Islands, three counties i n South Carolina, portions of one count y in Arizona, four counties in California, and portions of an additional four counties in California . The final regulations will entail restrictions on the interstate movement of regulated articles from quarantined a reas. Background Citrus greening, also known as Huanglongbing disease of citrus, is proven to be one of the most serious citrus diseases in the world. Citrus greening greatly reduces production, destroy s the economic value of the tree and its fruit , and can even kill the trees. Once infected, there is no cure for a citrus tree with citrus greening disease. In areas of the world where the disease is endemic, citrus trees decline and die within a few ye ars and may never produce usable fruit.2

The bacteria l pathogen causing citrus greening can be transmitted by grafting, and, under laboratory

conditions, by dodder. There is also emerging evidence that seed transmission may
occur . The bacteria l pathogen can also be transmitted by two insect vectors in the family Psyllidae : Diaphorina citri Kuway ama, ( ACP ) , and Trioza er yt reae (del Guercio), the African citrus psy llid

. ACP is currentl y thrives in the United States, in t he States and areas listed above

. The spread of citrus greening has unfavorable producti on, trade, and marketing implications for both fresh and processed citrus. Infected or infested citrus nursery stock pose a significant threat to the citrus industry as a whole, given the ease with which nursery stock movement can facilitate the spread of such pests and diseases as citrus canker, citrus greening, and ACP. The spread of these citrus pests and diseases can lead to significant costs, including infected tree removal, reduced yi elds associated with dead tree removal, increased grove survey cos ts, ACP control, and the cost of replacement trees. The costs of production in the citrus nursery stock industry have increased significantl y over the past decade as the industry has transformed to meet the demand for improved production practices designe d to produce disease free stock

. Production losses due to the spread of citrus greening result from increased control costs, reduced yi elds, and , in many instances, the eventual death of the infected citrus tree. Widespread production losses over time in areas previousl y unaffected could lead to an industry

- wide decline in domestically

grown citrus fruit. Also, affected commercial citrus

- producing States may face barriers to trade for fresh citrus exported to other citrus

- producing countries. The total v alue of the U.S. citrus crop, including oranges, grapefruit, and specialt y varieties intended for both the fresh and processed m arket, was estimated to be $2.98 billion for the 2010

- 2011 season. 1 However, the nation’s fruit

- bearing acreage has declined by 37 percent

1 NASS, “Citrus Fruits 20 11 Summary,” September 2 0 11
.3

since 1996 after which the industry experienced annual declines in new planting of acreage , in part because of the introduction and spread of harmful pests and diseases. 2 Therefore, implementation of the final rule is intended to further preve nt the spread of citrus greening and ACP to unaffe cted areas of the United States and to mitigate the extensive costs associated with this disease and pest. 

### Final Regulatory Flexibility Analysis This regulatory

impact analy sis provides a cost

- benefit ana ly sis, as required by Executive Orders 12866 and 13563 , which directs 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 pote ntial economic, environmental, public health and safet y effects, and equit y). 3 This document also examines the potential economic effects of this rule on small entities as required by the Regulatory

Flexibility

Act. 4 Need for and Objectives of the Rule AP HI S is imposing measures to prevent the spread of citrus greening and ACP to other commercial citrus

- producing areas by prohibiting or restricting the movement of host material outside of areas quarantined for the pest or the disease. The legal basis for this action is outlined in s ection 412(a) of the PPA, which allows the Secretary of Agriculture to prohibit or restrict the movement in interstate commerce of an y plant or plant product, if the Secretary determines that the prohibition or restriction is ne cessary to prevent the dissemination of a plant disease within the United States.

2 For 2006 statistics, see NASS, “Commercial Citrus Inventory 2011 ,” updated September 2011

. 3 http://www.whitehouse.gov/omb/inforeg/eo12866.pdf ; http://www.reginfo.gov/public/jsp/Utilities/EO_13563.pdf 4 http://www.sba.gov/advo/laws/regflex.html4

Significant Issues raised by Public Comment in response to the Initial Regulatory Flexibility Analysis There were no significant issues raised b y public comment in response t o the initial regulatory

flexibility

analy sis. Significant Issues raised by the Small Business Administration in response to the Initial Regulatory Flexibility Analysis There were no significant issues raised b y the Small Business Administration in respo nse to the initial regulatory

flexibility

anal ys is. Potentially Affected Small Entities Although the majorit y of affected establishments in the quarantined areas are small entities, the effects of this rule on these businesses will be minor. 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. This final measure will affect nursery

operations and other production sites in Al abama, California, Florida, Georgia, Guam, Hawaii, L ouisiana, Mississippi, Puerto Rico, South Carolina , Texas , and the U.S. Virgin Islands that produce citrus trees, orange jasmine, curryleaf, and other articles regulated by the rule. The small business s tandard for nurseries identified by the Small Business Administration (SBA), based upon the North American Industry Classification Sy stem (NAI CS) code 111422 (“nursery and tree production,” a subset of NAICS 1114, “greenhouse, nursery , and floriculture pro duction”) is $750,000 or less in annual receipts. 5 We have examined the possible impact of this rule on nurseries b y State.

5 Source: 2002 Census of Agriculture

- State Data and the “Small Business Size Standards by NAICS Industry,” 13 CFR Chapter 1.5

California APHI S does not have information on the size distribution of affected nursery operations in California, but, according to the 2007 Census of Agriculture , there were 3,549 greenhouse, nursery , and floriculture operations (NAI CS 1114). 6 Of these, more than 78 percent had annual sales in 2007 of less than $500,000, which is below the SBA’s small

- entity threshold of $750,000

. 7 We have ascertained that the majorit y of citrus nurseries are located within San Diego and Imperial Counties

—that is, within counties containing areas quarantined for ACP. While information on cash receipts b y size of operation is not readily availabl e, it is reasonable to assume that the majority of citrus operations in these counties qualify as small entities. Additionally , all entities located within newl y quarantined areas, both those for ACP and those for citrus greening, will be subject to the r estrictions and prohibitions contained in the final rule. Florida Most nursery

operators in the State of Florida are small entities, according to SBA standards. In an interim rule effective and published in the Federal Register on August 1, 2006 (71 FR 43345

- 43352, Docket No. APHIS

- 2006

- 0114), APHI S amended the domestic quarantine regulations by

designating the entire State of Florida as a quarantined area for citrus canker. This change had the effect of explicitly forbidding the movement of fruit into States designated as commercial citrus

- producing areas and the movement of other citrus articles into any State. 8 The amended regulations reflected a change in policy earlier that y ear, when USDA announced

6 NASS, United States Department of Agriculture (USDA), “United States: Summary and State Data, Volume 1,” 2007 Census of Agriculture , issued February 2009. 7 Source: SBA and 2002 Census of Agriculture

. 8 To view this rule, go to http://www.regulations.gov/fdmspublic/component/main?main=DocketDetail&d=APHIS

- 2006

- 0114.6

on January

10, 2006, that the eradication

- based program pursued by USDA and the State of Florida up to that point was no longer a scientifically feasible option to address citrus canker. In an interim rule 9 effective and published in the Federal Register on March 22, 2007 (72 FR 13423

- 13428, Docket No. APHIS

- 2007

- 0032), APHI S clarified the citrus canker regulations in order to explicitly forbid, with two, limited exceptions, the interstate movement of regulated nursery

stock from areas quarantined for citrus canker and to address the risk associated with such movement. As one of these exceptions, we allowed calamondin and kumquat nursery

stock to move interstate in accordance with a protocol designed to ensure their freedom from citrus canker prior to movement. We subsequentl y published a final rule following the March 2007 interim rule on April 9, 2009 (74 FR 16097

- 16104, Docket No. APHI S

- 2007

- 0032). In that final rule, we removed calamondin from the protocol. Under this final rule, all citrus nursery stock is prohibited from interstate movement from the State of Florida, except for immediate export. This includes all species previously exempted under the regulations. Although APHIS has not been able to confirm the number of citrus nursery stock producers in the State of Florida currently engag ed in kumquat nursery stock production, correspondence with State officials has suggested that there were no more than four such producers in 2007. 10 APHI S did not receive further information from the public during the comment period on the number of nurs ery stock producers in the State of Florida currentl y engaged in kumquat nursery stock production

.

9 To view this rule, go to http://www.regulations.gov/fdmspublic/ component/main?main=DocketDetail&d=APHIS

- 2007

- 0032. 10 Source: Florida’s Department of Agriculture and Consumer Services/Bureau of Plant and Apiary Inspection. Correspondence with APHIS, November 2007.7

Hawaii APHI S does not have information on the size distribution of affected nursery operations in Hawaii, but, according to the 2007 Census of Agriculture , there were 1,393 greenhouse, nursery , and floriculture operations within the State (NAICS 1114). 11 Of these, nearl y 96 percent had annual sales in 2007 of less than $500,000, which is well below the SBA’s small

entity threshold of $750,000. Louisiana APHI S does not have information regarding the size distribution of the total affected nursery operations in L ouisiana, but, according to the 2007 Census of Agriculture, there were a total of 661 greenhouse, nursery , and floriculture operations (NAI CS 1114). 12 Of this number, more than 93 percent had annuals sales in 2002 of less than $500,000, which is well below the SBA’s small

- entity

threshold of $750,000. 13 We have ascertained that the majority , if not all, of the State’s citrus operations are located within Plaquemines Parish. 14 In 2008, there we re approximately 10 nurseries reported in this parish; these operations produce d roughl y 350,000 to 400,000 trees per year. While information on cash receipts by size of operation is not readily available, it is reas onable to assume that a majorit y qualify as small entities. Moreover, approximately 60 to 70 percent of Louisiana’s citrus nursery stock is currentl y shipped interstate.

11 Source: NASS, “United States: Summary and State Da ta, Volume 1,” 2007 Census of Agriculture , issued February 2009. 12 NASS, “United States: Summary and State Data, Volume 1,” 2007 Census of Agriculture , issued February 2009. 13 Source: SBA and 2002 Census of Agriculture

. 14 Source: Louisiana Department of Agriculture and Forestry. Correspondence with APHIS, September 2008.8

Texas In 2008, there were approximately 18 commercial citrus operations accounting for 95 percent of the citrus nursery plants produced in Texas . Ten of the 18 operations met the criteria to be considered small businesses according to SBA standards. Additionally, there were another 17 nursery

operations in Texas in 2008 producing citr us plants, along with non

- citrus nursery plants, that would account for the remaining 5 percent of the State’s nursery stock. 15 Because the majority of the operations that account for 95 percent of Texas’ nursery stock production either meet or, at most, s lightly

exceed the SBA standards for small entities, it is therefore reasonable to assume that these nurseries, which account for a much smaller percentage of Texas’ nursery stock production, meet the small business size standard for nurseries identified b y the SBA. Alabama, Georgia, Mississippi, South Carolina, Guam, Puerto Rico, and U.S. Virgin Islands Nursery operations that engage in the production of the regulated articles in Alabama, Georgia, Mississippi, South Carolina, Guam, Puerto Rico, and U.S. Virgin I slands are considered to be predominantly

small. However, APHI S do es not have information the number or size of nursery operations that produce the regulated articles for sale outside of quarantined areas as we did not receive information from the public during the comment period of the interim rule that would aid us in identify ing the potential effects of the rule for small entities in these States

. American Samoa , Northern Mariana Islands, Ventura, Santa Barbara , Los Angeles, and Orange Counties , CA , and Hidalgo Count y, TX Since the interim rule was issued, we have quarantined American Samoa, Northe rn Mariana Islands for ACP, have extended the boundaries of the quarantine area for ACP in California to include all of one count y (Ventura C ounty ) an d portions of another additional

15 Source: Texas Department of Agriculture. Correspondence with APHIS, February 2009.9

county (Santa Barbara County ) , and have quarantined portions of one county in Texas (Hidalgo County ) and an area comprising portions of two counties in California (Los Angeles and Orange Counties) for citrus greening. Prod ucers in the newly

quarantined areas for ACP that have relied on markets in commercial citrus

- producing areas that are not currentl y quarantined for ACP or citrus greening will suf

fer the loss of those markets. Producers in the newly quarantined areas for citrus greening will likely experience a prohibition on the interstate movement of regulated articles. However, i t is un likely that producers of citrus nursery stock in these areas currentl y produce citrus nursery

stock intended for markets outside of th e quarantine area . The effort to mitigate the further spread of ACP and citrus greening will serve to benefit to other citrus producing areas. Projected Reporting, Recordkeeping, and Other Compliance Requirement s Reporting and recordkeeping requi rements associated with the final rule are discussed in the rule under the heading "Paperwork Reduction Act." Steps taken by APHIS to minimize Significant Economic Impact s on Small Entities Based on our review of available information, APH IS does not expec t the rule to have a significant economic impact on small entities. In the absence of significant economic impacts, we have not identified alternatives that would minimize such impacts for the final rule

.