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[Federal Register Volume 76, Number 168 (Tuesday, August 30, 2011)]
[Proposed Rules]
[Pages 53842-53844]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-22111]

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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 76, No. 168 / Tuesday, August 30, 2011 / 
Proposed Rules

[[Page 53842]]

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 948

[Doc. No. AMS-FV-11-0051; FV11-948-1 PR]

Irish Potatoes Grown in Colorado; Modification of the Handling 
Regulation for Area No. 3

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule invites comments on revisions to the size 
requirements currently prescribed under the Colorado potato marketing 
order (order). The order regulates the handling of Irish potatoes grown 
in Colorado, and is administered locally by the Colorado Potato 
Administrative Committee for Area No. 3 (Committee). This rule would 
modify the size requirements for handling small potatoes that measure 
under 1\7/8\ inches in diameter. This rule would allow the handling of 
two size ranges, \3/4\-inch minimum diameter to 1\7/8\ inches maximum 
diameter and Size B (1\1/2\ to 2\1/4\ inches), if such potatoes 
otherwise meet the requirements of the U.S. No. 1 grade. The revisions 
would promote orderly marketing by ensuring that only potatoes of 
certain similar size profiles are packed and shipped in the same 
container. This rule is expected to benefit the producers, handlers, 
and consumers of Colorado potatoes.

DATES: Comments must be received by October 31, 2011.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposal. Comments must be sent to the Docket Clerk, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938; or Internet: http://www.regulations.gov. All comments should reference the document number 
and the date and page number of this issue of the Federal Register and 
will be made available for public inspection in the Office of the 
Docket Clerk during regular business hours, or can be viewed at: http://www.regulations.gov. All comments submitted in response to this rule 
will be included in the record and will be made available to the 
public. Please be advised that the identity of the individuals or 
entities submitting the comments will be made public on the Internet at 
the address provided above.

FOR FURTHER INFORMATION CONTACT: Barry Broadbent or Gary Olson, 
Northwest Marketing Field Office, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, Telephone: (503) 326-
2724, Fax: (503) 326-7440, or E-mail: Barry.Broadbent@ams.usda.gov or 
GaryD.Olson@ams.usda.gov.
    Small businesses may request information on complying with this 
regulation by contacting Laurel May, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence 
Avenue, SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 
720-2491, Fax: (202) 720-8938, or E-mail: Laurel.May@ams.usda.gov.

SUPPLEMENTARY INFORMATION: This proposal is issued under Marketing 
Agreement No. 97 and Order No. 948, both as amended (7 CFR part 948), 
regulating the handling of Irish potatoes grown in Colorado, 
hereinafter referred to as the ``order.'' The order is effective under 
the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 
601-674), hereinafter referred to as the ``Act.''
    The Department of Agriculture (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA a petition 
stating that the order, any provision of the order, or any obligation 
imposed in connection with the order is not in accordance with law and 
request a modification of the order or to be exempted therefrom. A 
handler is afforded the opportunity for a hearing on the petition. 
After the hearing, USDA would rule on the petition. The Act provides 
that the district court of the United States in any district in which 
the handler is an inhabitant, or has his or her principal place of 
business, has jurisdiction to review USDA's ruling on the petition, 
provided an action is filed not later than 20 days after the date of 
the entry of the ruling.
    This proposal invites comments on revisions to the size 
requirements currently prescribed under the order. This proposed rule 
would revise the size requirements for small U.S. No. 1 grade potatoes 
handled under the Colorado Area 3 handling regulations. The rule would 
modify the current size requirements to establish allowable size ranges 
for potatoes that measure less than 1\7/8\ inches. This rule would 
allow potatoes that measure \3/4\-inch minimum diameter to 1\7/8\ 
inches maximum diameter to be handled if such potatoes otherwise meet 
the requirements of the U.S. No. 1 grade. In addition, Size B potatoes 
(1\1/2\ inches minimum diameter to 2\1/4\ inches maximum diameter) 
would also be allowed to be handled if they otherwise meet the U.S. No. 
1 grade requirements. The size requirements for U.S. No. 2 and better 
grade potatoes that are 1\7/8\ inches minimum diameter and larger would 
not be affected by this proposed change. The rule was unanimously 
recommended by the Committee at a meeting on May 12, 2011. The proposed 
changes are expected to enhance orderly marketing conditions and 
increase returns for producers and handlers.
    Section 948.22 authorizes the issuance of grade, size, quality, 
maturity, pack, and container regulations for potatoes grown in the 
production area. Section 948.21 further authorizes the modification, 
suspension, or termination of requirements issued pursuant to Sec.  
948.22.
    Section 948.40 provides that whenever the handling of potatoes is 
regulated pursuant to Sec. Sec.  948.20 through 948.24, such potatoes 
must be inspected by the Federal-State Inspection Service, and 
certified as meeting the applicable requirements of such regulations.
    Under the order, the State of Colorado is divided into three 
separate regulatory areas for marketing order purposes. Area No. 1, 
commonly known as the Western Slope, includes and consists of the

[[Page 53843]]

counties of Routt, Eagle, Pitkin, Gunnison, Hinsdale, La Plata, and all 
counties west thereof; Area No. 2, commonly known as the San Luis 
Valley, includes and consists of the counties of Saguache, Huerfano, 
Las Animas, Mineral, Archuleta, and all counties south thereof; and 
Area No. 3 includes and consists of all the remaining counties in the 
State of Colorado which are not included in Area No. 1 or Area No. 2. 
The order currently regulates the handling of potatoes grown in Areas 
No. 2 and No. 3 only; regulation for Area No. 1 is currently not 
active.
    Grade, size, and maturity regulations specific to the handling of 
Colorado potatoes grown in Area No. 3 are contained in Sec.  948.387 of 
the order's administrative rules and regulations. Section 948.387(a) 
currently requires that all varieties of potatoes handled under the 
order must be U.S. No. 2 or better grade and 1\7/8\ inches minimum 
diameter or 4 ounces minimum weight, except that potatoes that meet the 
requirements of the U.S. No. 1 grade may be \3/4\-inch minimum 
diameter.
    The Committee met on May 12, 2011, to discuss revising the size 
requirements in the handling regulations. As a result of the 
deliberations, the Committee unanimously recommended modifying the size 
requirements for potatoes that meet the U.S. No. 1 grade. Specifically, 
the Committee recommended establishing allowable size ranges for small 
size (under 1\7/8\ inches in diameter) U.S. No. 1 grade and better 
potatoes. Two allowable size ranges, \3/4\-inch minimum diameter to 
1\7/8\ inches maximum diameter and Size B (1\1/2\ inches minimum 
diameter to 2\1/4\ inches maximum diameter), would be established for 
potatoes that otherwise meet or exceed the minimum requirements of the 
U.S. No. 1 grade standard. The proposed allowable size ranges would 
replace the current \3/4\-inch minimum diameter size requirement 
allowance now in effect.
    The proposed revision would not prohibit the handling of any of the 
small size potatoes that are currently allowed to be handled under the 
order. All potatoes that measure \3/4\-inch minimum diameter and larger 
and meet the requirements of the U.S. No. 1 grade could continue to be 
handled under the order. However, in the future, such small potatoes 
would be required to be handled subject to the new size requirements, 
with like size potatoes packed into certain size profiles. The handling 
of all other potatoes currently permitted under the order would 
continue without change, subject to the U.S. No. 2 or better, 1\7/8\ 
inches minimum diameter size or 4 ounces minimum weight requirements.
    The Committee has observed that, in recent years, consumer demand 
has been increasing for smaller size potatoes and that those size 
potatoes often command premium prices. The Committee previously 
responded to this trend by modifying the size requirements in the 
handling regulations to allow for the handling of \3/4\-inch minimum 
diameter and larger size potatoes, if the potatoes otherwise meet the 
requirements of the U.S. No. 1 grade. However, the current \3/4\-inch 
minimum size requirement has no other parameters associated with it and 
allows for the commingling of small size potatoes (under 1\7/8\ inches 
in diameter) with larger size potatoes (over 1\7/8\ inches in 
diameter).
    The Committee reiterated that quality assurance is important to the 
industry and to consumers. Providing consistent, high quality potatoes 
is necessary to maintain consumer confidence. The potential for mixing 
small size potatoes with larger size potatoes in the same container is 
perceived by the Committee as being contrary to the goals of 
maintaining orderly marketing conditions and ensuring that only 
consistent, high quality potatoes from the production area enter the 
market. As such, the Committee felt that implementing the proposed 
revisions to the size requirements would help to maintain the 
consistency and quality of the product while still allowing the 
industry the maneuverability to respond to changing consumer 
preferences.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) 
has considered the economic impact of this action on small entities. 
Accordingly, AMS has prepared this initial regulatory flexibility 
analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and rules issued thereunder, are unique in that 
they are brought about through group action of essentially small 
entities acting on their own behalf.
    Based on Committee data, there are eight producers (the majority of 
whom are also handlers) in the regulated area and eight handlers (the 
majority of whom are also producers) subject to regulation under the 
order. Small agricultural producers are defined by the Small Business 
Administration (13 CFR 121.201) as those having annual receipts of less 
than $750,000, and small agricultural service firms are defined as 
those having annual receipts of less than $7,000,000.
    According to the Committee, 981,609 hundredweight of Colorado Area 
No. 3 potatoes were produced for the fresh market during the 2009-2010 
season. Based on National Agricultural Statistics Service (NASS) data, 
the average producer price for Colorado summer potatoes for that season 
was $6.90 per hundredweight. The average annual producer revenue for 
the eight Colorado Area No. 3 potato producers is therefore calculated 
to be approximately $846,637. Using Committee data regarding each 
individual handler's total shipments during the 2009-2010 fiscal period 
and a Committee estimated average f.o.b. price for 2010 of $9.10 per 
hundredweight ($6.90 per hundredweight producer price plus estimated 
packing and handling costs of $2.20 per hundredweight), none of the 
Colorado Area No. 3 potato handlers ship over $7,000,000 worth of 
potatoes. Thus, all of the handlers and many of the producers of 
Colorado Area No. 3 potatoes may be classified as small entities.
    This rule would revise the current size requirements contained in 
the order's handling regulations. The rule would revise the size 
requirements to establish two allowable size ranges, \3/4\-inch minimum 
to 1\7/8\ inches maximum diameter and Size B, if such potatoes 
otherwise meet the requirements of the U.S. No. 1 grade standard. The 
revisions would promote orderly marketing by ensuring that only 
potatoes of a similar size profile are shipped in the same container.
    The authority for regulating grade and size is provided in Sec.  
948.22 of the order. Section 948.387(a) of the order's administrative 
rules and regulations prescribes the applicable size requirements.
    This rule is expected to have a beneficial impact on handlers and 
producers by maintaining the superior reputation of the industry and 
ensuring that only consistent, high quality potatoes are shipped from 
the production area. There should be no extra cost to producers or 
handlers as a result of the proposed changes because current harvesting 
and handling methods can accommodate the sorting of these smaller 
potatoes. The Committee believes that this revision should translate 
into greater returns for handlers and producers over time.
    Neither NASS nor the Committee compiles statistics relating to the

[[Page 53844]]

production of potatoes measuring less than 1\7/8\ inches in diameter. 
The Committee has relied on information provided by producers and 
handlers familiar with the small potato market for its recommendation.
    As small potatoes have grown in popularity with consumers, high 
quality potatoes from Colorado have been in demand. The Committee 
believes that modifying the size requirements for such small potatoes 
would maintain their consistency and increase their quality reputation 
in the market. The proposed changes are expected to increase sales of 
Colorado potatoes and to benefit the Colorado potato industry. The 
benefits of this rule are not expected to be disproportionately greater 
or lesser for small entities than for large entities.
    The Committee discussed alternatives to this recommendation, 
including taking no action on the matter. One alternative discussed was 
to use other size ranges other than the ranges proposed. The Committee 
believed that the size ranges proposed offered the best compromise 
between regulatory control and accommodation for the marketing needs of 
the handlers. Another alternative was to establish just one \3/4\-inch 
to 1\7/8\ inches size range for small potatoes. However, that 
alternative was rejected because it would not have accommodated the 
mid-size range potatoes that some handlers prefer to ship. Thus, the 
Committee unanimously agreed that their recommendation reflected the 
best alternative available to achieve the desired result.
    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. 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 action would not impose any additional reporting or 
recordkeeping requirements on either small or large potato 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. In addition, USDA 
has not identified any relevant Federal rules that duplicate, overlap 
or conflict with this proposed 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.
    In addition, the Committee's meeting was widely publicized 
throughout the potato industry, and all interested persons were invited 
to attend the meeting and participate in Committee deliberations. Like 
all Committee meetings, the May 12, 2011, meeting was a public meeting 
and all entities, both large and small, were able to express their 
views on this issue. Finally, interested persons are invited to submit 
comments on this proposed rule, including the regulatory and 
informational impacts of this action on small businesses.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/MarketingOrdersSmallBusinessGuide. Any questions 
about the compliance guide should be sent to Laurel May at the 
previously mentioned address in the FOR FURTHER INFORMATION CONTACT 
section.
    A 60-day comment period is provided to allow interested persons to 
respond to this proposal. All written comments timely received will be 
considered before a final determination is made on this matter.

List of Subjects in 7 CFR Part 948

    Marketing agreements, Potatoes, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 948 is 
proposed to be amended as follows:

PART 948--IRISH POTATOES GROWN IN COLORADO

    1. The authority citation for 7 CFR part 948 continues to read as 
follows:

    Authority:  7 U.S.C. 601-674.

    2. In Sec.  948.387, revise paragraph (a) and add paragraphs (a)(1) 
through (a)(3) to read as follows:

Sec.  948.387  Handling regulation.

* * * * *
    (a) Minimum grade and size requirements--All varieties. (1) U.S. 
No. 2 or better grade, 1\7/8\ inches minimum diameter or 4 ounces 
minimum weight.
    (2) U.S. No.1 grade, Size B (1\1/2\ inches minimum to 2\1/4\ inches 
maximum diameter).
    (3) U.S. No.1 grade, \3/4\-inch minimum to 1\7/8\ inches maximum 
diameter.
* * * * *

    Dated: August 19, 2011.
David R. Shipman,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2011-22111 Filed 8-29-11; 8:45 am]
BILLING CODE 3410-02-P
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