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.

Proposed Rules Federal Register

66033

Vol. 62, No. 242

Wednesday, December 17, 1997

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 51

[Docket Number FV–97–302]

RIN 0581–AB51

Fees for Destination Market

Inspections of Fresh Fruits, Vegetables

and Other Products

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Proposed rule.

SUMMARY: This proposed rule would

revise the regulations governing the

inspection and certification for fresh

fruits, vegetables and other products by

increasing by approximately 10 percent

the fees charged for the inspection of

these products at destination markets.

These revisions are necessary in order to

recover, as nearly as practicable, the

costs of performing inspection services

at destination markets under the

Agricultural Marketing Act of 1946. The

fees charged to persons required to have

inspections on imported commodities in

accordance with the Agricultural

Marketing Agreement Act of 1937 and

for imported peanuts under the

Agricultural Act of 1949 would also be

affected. This rule would also revise the

regulations with regard to the

disposition of inspection certificates to

require that one copy of the certificate

be delivered or mailed to the shipper of

the inspected product.

DATES: Comments must be postmarked

or courier dated on or before February

17, 1998.

ADDRESSES: Interested persons are

invited to submit written comments

concerning this proposal. Comments

must be sent to the Program Support

Section, Fresh Products Branch, Fruit

and Vegetable Programs, Agricultural

Marketing Service, U.S. Department of

Agriculture, P.O. Box 96456, Room 2049

South Building, Washington, D.C.

20090–6456. Comments should make

reference to the date and page number

of this issue of the Federal Register and

will be made available for public

inspection in the above office during

regular business hours.

FOR FURTHER INFORMATION CONTACT: Rob

Huttenlocker at the above address or

call (202) 720–0297.

SUPPLEMENTARY INFORMATION:

Executive Order 12866 and Regulatory

Flexibility Act

This rule has been reviewed by the

Office of Management and Budget and

has been determined not significant for

purposes of Executive Order 12866.

Also, pursuant to the requirements set

forth in the Regulatory Flexibility Act

(RFA), the Agricultural Marketing

Service (AMS) has considered the

economic impact of this action on small

entities.

AMS regularly reviews its user-fee

financed programs to determine if the

fees are adequate. The existing fee

schedule will not generate sufficient

revenues to cover program costs while

maintaining an adequate reserve balance

(four months of costs) as called for by

Agency policy (AMS Directive 408.1).

Current revenue projections for

destination market inspection work

during FY 97 are $12.0 million with

costs projected at $11.9 million and an

end-of-year reserve of $3.0 million.

However, the Fresh Products Branch’s

(FPB) trust fund balance for this

program will be approximately $1.0

million under the four-month level of

approximately $4.0 million. Further,

FPB’s costs of operating the destination

market program are expected to increase

to approximately $12.9 million during

FY 98 and to approximately $13.2

million in FY 99. These cost increases

will result from both inflationary

increases with regard to current FPB

operations and services and the need to

improve or expand current services.

Employee salaries and benefits are

major program costs that account for

approximately 80 percent of FPB’s total

operating budget. A general and locality

salary increase for Federal employees,

ranging from 2.30 to 4.66 percent

depending on locality, effective January

1997, significantly increased program

costs. Another general and locality

salary increase is expected to become

effective in January 1998. In addition,

inflation also impacts upon FPB’s nonsalary costs. These increases will

increase FPB’s costs of operating this

program by approximately $300,000 per

year.

Additional revenues are also needed

to enable FPB to cover the costs of

improving program integrity by mailing

copies of all destination market

certificates to the shippers of the

products inspected. FPB estimates that

it will cost $200,000 per year for the

postage, envelopes and additional staff

time to send the approximately 275,000

inspection certificates it issues

annually. Additional revenues are also

necessary in order that FPB may cover

the costs of securing the additional staff

($200,000) needed to increase the

timeliness of service delivery in several

destination markets which are currently

in need of additional staffing (e.g.,

Dallas, Texas). Finally, FPB needs an

additional $200,000 per year for three to

four years to cover the costs of securing

the equipment (e.g., digital imaging

cameras and computers, inspector

notebook computers and Agencymandated information systems

upgrades) needed to expand FPB’s

services and to make existing services

more efficient in the future.

This proposed fee increase should

result in an estimated $1.2 million in

additional revenues per year (only

$600,000 during FY 98 since any fee

increase would be effective on April 1,

1998) and should enable FPB to cover

its costs while maintaining current

program reserves (at a level below that

provided for by Agency policy).

The purpose of the RFA is to fit

regulatory actions to the scale of

businesses subject to such actions in

order that small businesses will not be

unduly or disproportionately burdened.

The action described herein is being

considered for several reasons,

including that additional user fee

revenues are needed to cover the costs

of: (1) providing current program

operations and services; (2) improving

program integrity by mailing copies of

all destination market certificates to the

shippers of the products inspected (the

basis for the proposed change in

regulation with regard to the disposition

of inspection certificates to include that

one copy be delivered or mailed to the

shipper of the inspected product); (3)

improving the timeliness with which

inspection services are provided; and (4)

acquiring technological advancements

(e.g., digital imaging cameras and

computers, inspector notebook
66034 Federal Register / Vol. 62, No. 242 / Wednesday, December 17, 1997 / Proposed Rules

1Section 8e of the Agricultural Marketing

Agreement Act of 1937, as amended (7 U.S.C. 601–

674), requires that whenever the Secretary of

Agriculture issues grade, size, quality or maturity

regulations under domestic marketing orders for

certain commodities, the same or comparable

regulations on imports of those commodities must

be issued. Import regulations apply only during

those periods when domestic marketing order

regulations are in effect.

Currently, there are 15 commodities subject to 8e

import regulations: avocados, dates (other than

dates for processing), filberts, grapefruit, kiwifruit,

limes, olives (other than Spanish-style green olives),

onions, oranges, Irish potatoes, prunes, raisins,

table grapes, tomatoes and walnuts. A current

listing of the regulated commodities can be found

under 7 CFR Parts 944, 980 and 999. Section

999.600 establishes minimum quality,

identification, certification and safeguard

requirements for foreign produced farmers stock,

shelled and cleaned in-shell peanuts presented for

importation into the United States. Import

requirements applicable to peanuts may be found

under subparagraph (f)(2) of section 108B of the

Agricultural Act of 1949 (7 U.S.C. 1445c–3), as

amended November 28, 1990, and August 10, 1993,

and section 155 of the Federal Agriculture

Improvement and Reform Act of 1996 (7 U.S.C.

7271).

computers and Agency-mandated

information systems upgrades) aimed at

expanding FPB’s services and making

them more efficient in the future. The

objective of this proposed rule is to

increase user fee revenue generated

under the destination market program

by approximately $1.2 million or

approximately 10 percent per year. This

action is authorized under the

Agricultural Marketing Act (AMA) of

1946 (see 7 U.S.C. 1622(h)) which states

that the Secretary of Agriculture may

assess and collect ‘‘such fees as will be

reasonable and as nearly as may be to

cover the costs of services

rendered * * *’’

There are more than 2,000 users of

FPB’s destination market grading

services (including applicants who must

meet import requirements 1—

inspections which amount to under 2.5

percent of all lot inspections

performed). A small portion of these

users are small entities under the

criteria established by the Small

Business Administration (13 CFR

121.601). There will be no additional

reporting, recordkeeping, or other

compliance requirements imposed upon

small entities as a result of this

proposed rule. FPB has not identified

any other Federal rules which may

duplicate, overlap or conflict with this

proposed rule.

Inasmuch as the destination market

grading services are voluntary (except

when required for imported

commodities), and since the fees

charged to users of these services vary

with usage, the impact on all

businesses, including small entities, is

very similar. Further, even though fees

will be raised, the increase is small

(approximately ten percent) and should

not significantly affect these entities.

Finally, except for those persons who

are required to obtain inspections, most

of these businesses are typically under

no obligation to use these inspection

services, and, therefore, any decision on

their part to discontinue the use of the

services should not prevent them from

marketing their products.

Executive Order 12988

This rule has been reviewed under

Executive Order 12988, Civil Justice

Reform. This action is not intended to

have retroactive effect. This rule will

not preempt any State or local laws,

regulations or policies, unless they

present an irreconcilable conflict with

this rule. There are no administrative

procedures which must be exhausted

prior to any judicial challenge to the

provisions of this rule.

Proposed Action

The AMA authorizes official

inspection, grading and certification, on

a user-fee basis, of fresh fruits,

vegetables and other products such as

raw nuts, Christmas trees and flowers.

The AMA provides that reasonable fees

be collected from the users of the

services to cover, as nearly as

practicable, the costs of the services

rendered. This proposed rule will

amend the schedule for fees and charges

for inspection services rendered to the

fresh fruit and vegetable industry to

reflect the costs necessary to operate the

program.

AMS regularly reviews its user-fee

programs to determine if the fees are

adequate. While FPB continues to

search for opportunities to reduce its

costs, the existing fee schedule will not

generate sufficient revenues to cover

program costs while maintaining an

adequate reserve balance (four months

of costs) as called for by Agency policy

(AMS Directive 408.1). Current revenue

projections for destination market

inspection work during FY 97 are $12.0

million with costs projected at $11.9

million and an end-of-year reserve of

$3.0 million. However, FPB’s trust fund

balance for this program will be

approximately $1.0 million under the

four-month level of approximately $4.0

million. Further, FPB’s costs of

operating the destination market

program are expected to increase to

approximately $12.9 million during FY

98 and to approximately $13.2 million

in FY 99. These cost increases (which

are outlined below) will result from

both inflationary increases with regard

to current FPB operations and services

and the need to improve or expand

current services.

Employee salaries and benefits are

major program costs that account for

approximately 80 percent of FPB’s total

operating budget. A general and locality

salary increase for Federal employees,

ranging from 2.30 to 4.66 percent

depending on locality, effective January

1997, significantly increased program

costs. Another general and locality

salary increase is expected to become

effective in January 1998. In addition,

inflation also impacts upon FPB’s nonsalary costs. These increases will

increase FPB’s costs of operating this

program by approximately $300,000 per

year.

Additional revenues are also needed

to enable FPB to cover the costs of

improving program integrity by mailing

copies of all destination market

certificates to the shippers of the

products inspected. This is an essential

step in FPB’s ongoing effort to improve

the integrity of the inspection process.

This action will assist in preventing

industry participants from using

falsified inspection certificates to alter

the terms of sales between shippers and

receivers. In accordance with this effort,

the regulations with regard to the

disposition of inspection certificates in

7 CFR 51.21 are proposed to be revised

to require that one copy of the certificate

be provided to the shipper of the

inspected product. FPB estimates that it

will cost $200,000 per year for the

postage, envelopes and additional staff

time to send the approximately 275,000

inspection certificates it issues

annually.

Additional revenues are also

necessary in order that FPB may cover

the costs of securing the additional staff

($200,000) needed to increase the

timeliness of service delivery in several

destination markets which are currently

in need of additional staffing (e.g.,

Dallas, Texas). This action responds to

industry feedback to FPB’s FY 1996

Customer Service Survey which

emphasized the importance of

timeliness far more than cost

containment.

Finally, FPB needs an additional

$200,000 per year for three to four years

to cover the costs of securing the

equipment (e.g., digital imaging cameras

and computers, inspector notebook

computers and Agency-mandated

information systems upgrades) needed

to expand FPB’s services and to make

existing services more efficient in the

future.

This proposed fee increase should

result in an estimated $1.2 million in

additional revenues per year (only

$600,000 during FY 98 since any fee
Federal Register / Vol. 62, No. 242 / Wednesday, December 17, 1997 / Proposed Rules 66035

increase would be effective on April 1,

1998) and should enable FPB to cover

its costs while maintaining current

program reserves. In order to reach a

four month reserve, further increases in

fees will be likely in future years.

Based on the aforementioned analysis

of this program’s increasing costs, AMS

proposes to increase the fees for

destination market inspection services.

The following table compares current

fees and charges with proposed fees and

charges for fresh fruit and vegetable

inspection as found in 7 CFR 51.38.

Unless otherwise provided for by

regulation or written agreement between

the applicant and the Administrator, the

charges in the schedule of fees as found

in § 51.38 are:

Service Current Proposed

Quality and condition inspections of one to four products each in quantities of 51 or more packages

and unloaded from the same land or air conveyance:

Over a half carlot equivalent of each product ................................................................................. $78 ............................ $86.

Half carlot equivalent or less of each product ................................................................................. 65 .............................. 72.

For each additional lot of the same product .................................................................................... 13 .............................. 14.

Condition only inspections of one to four products each in quantities of 51 or more packages and

unloaded from the same land or air conveyance:

Over a half carlot equivalent of each product ................................................................................. 65 .............................. 72.

Half carlot equivalent or less of each product ................................................................................. 60 .............................. 66.

For each additional lot of the same product .................................................................................... 13 .............................. 14.

Quality and condition and condition only inspections of five or more products each in quantities of

51 or more packages and unloaded from the same land or air conveyance:

For the first five products ................................................................................................................. 277 ............................ 305.

For each additional product ............................................................................................................. 39 .............................. 43.

For each additional lot of any of the same product ......................................................................... 13 .............................. 14.

Quality and condition and condition only inspections of products each in quantities of 50 or less

packages unloaded from the same land or air conveyance:

For each product .............................................................................................................................. 39 .............................. 43.

For each additional lot of any of the same product ......................................................................... 13 .............................. 14.

Dock-side inspections of an individual product unloaded directly from the same ship:

For each package weighing less than 15 pounds ........................................................................... 1 cent ........................ 1.1 cents.

For each package weighing 15 to 29 pounds ................................................................................. 2 cents ....................... 2.2 cents.

For each package weighing 30 or more pounds ............................................................................. 3 cents ....................... 3.3 cents.

For each additional lot of any of the same product ......................................................................... 13 .............................. 14.

Minimum charge per individual product ........................................................................................... 78 .............................. 86.

Inspections performed for other purposes (except for contract work) during the grader’s regularly

scheduled work week.

39 per hour ................ 43 per hour.

Overtime or holiday premium rate (per hour additional) for all inspections performed outside the

grader’s regularly scheduled work week.

19.50 per hour ........... 21.50 per hour.

List of Subjects in 7 CFR Part 51

Agricultural commodities, Food

grades and standards, Fruits, Nuts,

Reporting and record keeping

requirements, Trees, Vegetables.

For reasons set forth in the preamble,

7 CFR Part 51 is proposed to be

amended as follows:

PART 51—[AMENDED]

1. The authority citation for 7 CFR

part 51 continues to read as follows:

Authority: 7 U.S.C. 1621–1627.

2. Section 51.21 is revised to read as

follows:

§ 51.21 Disposition of inspection

certificates.

The original certificate, and not to

exceed four copies (if requested by

applicant prior to issuance), shall be

delivered or mailed promptly to the

applicant or to a person designated by

him. One copy shall be delivered or

mailed to the shipper of the inspected

product. One copy shall be filed in the

office of the inspector when the

inspection is made by a Federal

Government employee, otherwise, it

shall be filed in the appropriate office of

the cooperating Federal-State Inspection

Agency. Unless otherwise directed by

the Administrator, two copies of each

official certificate issued on products

received in destination markets shall be

forwarded to the Administrator to be

kept on file in Washington and no

copies of official certificates issued at

shipping point need be so forwarded. In

the case of any product covered by a

marketing agreement and/or order

effective pursuant to the Agricultural

Marketing Agreement Act of 1937, as

amended (7 U.S.C. 601 et seq.), at least

one copy of each certificate covering the

inspection of such product shall, on

request, be delivered to the

administrative agency established

thereunder, subject to such terms and

conditions as the Administrator may

prescribe. Copies may be furnished to

other interested parties as outlined in

§ 51.41.

3. Section 51.38 is revised to read as

follows:

§ 51.38 Basis for fees and rates.

(a) When performing inspections of

product unloaded directly from land or

air transportation, the charges shall be

determined on the following basis:

(1) For products in quantities of 51 or

more packages:

(i) Quality and condition inspection

of 1 to 4 products unloaded from the

same conveyance:

(A) $86 for over a half carlot

equivalent of an individual product.

(B) $72 for a half carlot equivalent or

less of an individual product.

(C) $14 for each additional lot of the

same product.

(ii) Condition only inspection of 1 to

4 products unloaded from the same

conveyance:

(A) $72 for over a half carlot

equivalent of an individual product.

(B) $66 for a half carlot equivalent or

less of an individual product.

(C) $14 for each additional lot of the

same product.

(iii) Quality and condition inspection

and/or condition only inspection of 5 or

more products unloaded from the same

conveyance:

(A) $305 for the first 5 products.

(B) $43 for each additional product.

(C) $14 for each additional lot of any

of the same product.
66036 Federal Register / Vol. 62, No. 242 / Wednesday, December 17, 1997 / Proposed Rules

(2) For quality and condition

inspection and/or condition only

inspection of products in quantities of

50 or less packages unloaded from the

same conveyance:

(i) $43 for each individual product.

(ii) $14 for each additional lot of any

of the same product.

(b) When performing inspections of

palletized products unloaded directly

from sea transportation or when

palletized product is first offered for

inspection before being transported

from the dock-side facility, charges shall

be determined on the following basis:

(1) For each package inspected

according to the following rates:

(i) 1.1 cent per package weighing less

than 15 pounds;

(ii) 2.2 cents per package weighing 15

to 29 pounds; and,

(iii) 3.3 cents per package weighing 30

or more pounds.

(2) $14 for each additional lot of any

of the same product.

(3) A minimum charge of $86 for each

product inspected.

(c) When performing inspections of

products from sea containers unloaded

directly from sea transportation or when

palletized products unloaded directly

from sea transportation are not offered

for inspection at dockside, the carlot

fees in § 51.38(a) shall apply.

(d) When performing inspections for

Government agencies, or for purposes

other than those prescribed in the

preceding paragraphs, including weightonly and freezing-only inspections, fees

for inspection shall be based on the time

consumed by the grader in connection

with such inspections, computed at a

rate of $43 an hour: Provided, That:

(1) Charges for time shall be rounded

to the nearest half hour;

(2) The minimum fee shall be two

hours for weight-only inspections, and

one-half hour for other inspections; and

(3) When weight certification is

provided in addition to quality and/or

condition inspection, a one-hour charge

shall be added to the carlot fee.

(4) When inspections are performed to

certify product compliance for Defense

Personnel Support Centers, the daily or

weekly charge shall be determined by

multiplying the total hours consumed to

conduct inspections by the hourly rate.

The daily or weekly charge shall be

prorated among applicants by

multiplying the daily or weekly charge

by the percentage of product passed

and/or failed for each applicant during

that day or week. Waiting time and

overtime charges shall be charged

directly to the applicant responsible for

their incurrence.

(e) When performing inspections at

the request of the applicant during

periods which are outside the grader’s

regularly scheduled work week, a

charge for overtime or holiday work

shall be made at the rate of $21.50 per

hour or portion thereof in addition to

the carlot equivalent fee, package

charge, or hourly charge specified in

this subpart. Overtime or holiday

charges for time shall be rounded to the

nearest half hour.

(f) When an inspection is delayed

because product is not available or

readily accessible, a charge for waiting

time shall be made at the prevailing

hourly rate in addition to the carlot

equivalent fee, package charge, or

hourly charge specified in this subpart.

Waiting time shall be rounded to the

nearest half hour.

Dated: December 11, 1997

Robert C. Keeney,

Deputy Administrator, Fruit and Vegetable

Programs.

[FR Doc. 97–32813 Filed 12–16–97; 8:45 am]

BILLING CODE 3410–02–P

DEPARTMENT OF AGRICULTURE

Grain Inspection, Packers and

Stockyards Administration

7 CFR Parts 800 and 810

United States Standards for Rye

AGENCY: Grain Inspection, Packers and

Stockyards Administration, USDA.

ACTION: Proposed rule.

SUMMARY: The Federal Grain Inspection

Service (FGIS) of the Grain Inspection,

Packers and Stockyards Administration

(GIPSA) proposes to revise the United

States Standards for Rye to certificate

dockage to the nearest tenth of a

percent. The current method of dockage

certification rounds the actual dockage

percentage down to the nearest whole

percent. This method may result in

understating the level of dockage up to

0.99 percent on the certificate.

Certification of dockage to the nearest

tenth of a percent is more precise than

the current method and should enhance

the marketability of U.S. Rye traded in

the domestic and export markets. This

change would also require the

establishment of new inspection

tolerances or breakpoints, as

appropriate.

DATES: Comments must be submitted on

or before February 17, 1998.

ADDRESSES: Written comments must be

submitted to George Wollam, GIPSA,

USDA, Room 0623–S, Stop 3649,

Washington, D.C., 20250–3649; FAX

(202) 720–4628; or E-mail

gwollam@fgisdc.usda.gov.

All comments received will be made

available for public inspection at Room

0623 South Building, 1400

Independence Avenue, SW,

Washington, D.C., during regular

business hours (7 CFR 1.27 (b)).

FOR FURTHER INFORMATION CONTACT:

George Wollam, address as above,

telephone (202) 720–0292.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

The Department of Agriculture is

issuing this rule in conformance with

Executive Order 12866.

Executive Order 12988

This proposed rule has been reviewed

under Executive Order 12988, Civil

Justice Reform. This action is not

intended to have a retroactive effect.

The United States Grain Standards Act

provides in Section 87g that no State or

subdivision may require or impose any

requirements or restrictions concerning

the inspection, weighing, or description

of grain under the Act. Otherwise, this

proposed rule will not preempt any

State or local laws, regulations, or

policies, unless they present an

irreconcilable conflict with this

proposed rule. There are no

administrative procedures which must

be exhausted prior to any judicial

challenge to the provisions of this

proposed rule.

Regulatory Flexibility Act Certification

GIPSA has determined that this

proposed rule will not have a significant

economic impact on a substantial

number of small entities, as defined in

the Regulatory Flexibility Act (5 U.S.C.

601 et seq.), because most users of the

official inspection and weighing

services and those entities that perform

these services do not meet the

requirements for small entities. Further,

the regulations are applied equally to all

entities.

The rye industry, including

producers, handlers, exporters and

processors, are the primary users of the

U.S. Standards for Rye and utilize the

official standards as a common trading

language to market rye.

The rye industry in the United States

is regional in nature, concentrated

primarily in the upper midwest area.

There are an estimated 10 processors of

rye, utilizing a crop produced on

approximately 355,000 acres in the

United States. The average annual

production of rye for the period 1988

through 1997 was 10,045,000 bushels.

No rye has been officially inspected for

export from the United States for several

years.