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

6497

Vol. 62, No. 29

Wednesday, February 12, 1997

DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

7 CFR Part 1496

RIN 0560–AF09

Procurement of Processed Agricultural

Commodities for Donation Under Title

II, Pub. L. 480

AGENCY: Commodity Credit Corporation,

USDA

ACTION: Proposed Rule.

SUMMARY: This proposed regulation

would revise Commodity Credit

Corporation’s (‘‘CCC’’) procedures for

purchasing processed agricultural

commodities for donation overseas

under Title II of the Agricultural Trade

Development and Assistance Act of

1954, as amended, (‘‘Pub. L. 480’’). This

proposal would implement recent

statutory changes and adopt a simpler

and more efficient procurement process.

DATES: Written comments concerning

this proposed rule must be submitted by

April 14, 1997.

ADDRESSES: Comments must be sent to

USDA/FSA, Procurement and Donations

Division, Export Operations Branch,

Rm. 5755-S, Mail Stop 0551, P.O. Box

2415, Washington DC 20013–2415.

FOR FURTHER INFORMATION CONTACT: Jeff

Jackson, (202) 720–3995.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This rule has been determined to be

not significant for the purposes of

Executive Order 12866 and therefore

has not been reviewed by the Office of

Management and Budget (OMB).

Regulatory Flexibility Act

It has been determined that the

Regulatory Flexibility Act is not

applicable to this final rule since CCC

is not required by 5 U.S.C. 553 or any

other provision of law to publish a

notice of rulemaking with respect to the

subject matter of this rule.

Paperwork Reduction Act

The amendments to 7 CFR part 1496

set forth in this proposed rule do not

contain additional information

collections that require clearance by

OMB under the provisions of 44 U.S.C.

35.

Executive Order 12372

This rule is not subject to the

provisions of Executive Order 12372,

which requires intergovernmental

consultation with state and local

officials. See the Notice related to 7 CFR

part 3015, subpart V, published at 46 FR

29115 (June 24, 1983).

Executive Order 12988

This rule has been reviewed under the

Executive Order 12988, Civil Justice

Reform. The rule would have preemptive effect with respect to any state

or local laws, regulations, or policies

which conflict with such provisions or

which otherwise impede their full

implementation. The rule would not

have retroactive effect. Administrative

proceedings are not required before

parties may seek judicial review.

Background

General

Pursuant to Title II, Pub. L. 480, the

United States donates agricultural

commodities overseas to meet famine or

other relief requirements, combat

malnutrition, and promote economic

development. This program is

administered by the Agency for

International Development (‘‘A.I.D.’’).

A.I.D. donates commodities to foreign

governments, intergovernmental

organizations, or private relief agencies,

commonly referred to as ‘‘cooperating

sponsors’’ for the above purposes

through agreements between A.I.D. and

a cooperating sponsor.

CCC has the responsibility to acquire

and make available the agricultural

commodities needed to carry out

agreements under Title II, Pub L. 480.

CCC will either provide these

commodities from its inventory or by

purchases in the market. In addition to

bearing the cost of the donated

commodities, CCC is authorized to pay

other related costs including packaging,

processing, surveys, fumigation,

transportation to ports of export, and

ocean transportation costs. CCC does

not contract for the ocean transportation

services to ship the commodities.

Cooperating sponsors or A.I.D. are

responsible for contracting for ocean

transportation of the commodities.

Generally, A.I.D. will pay for the ocean

freight charges incurred by it or a

cooperating sponsor from funds

advanced to A.I.D. from CCC.

Commodity Procurement

CCC will procure packaged

commodities requested for Title II, Pub.

L. 480 through a public solicitation for

bids requesting offers to sell on an f.a.s.

vessel or intermodal basis. CCC

evaluates offers to sell commodities

submitted pursuant to an invitation for

bids on the general principle of ‘‘lowest

landed cost.’’ This simply means that, in

deciding which commodity offer to

accept, CCC will consider both the price

it would have to pay to acquire the

commodity and the anticipated freight

costs to ship the commodity to foreign

destination. Regulations governing the

bid evaluation process for the

procurement of processed agricultural

commodities for Title II, Pub. L. 480

appear at 7 CFR part 1496. In making a

lowest landed cost analysis, CCC relies

upon published tariff rates on file with

the Federal Maritime Commission and

current rate information furnished to the

Kansas City Commodity Office by the

ocean freight carriers. The most

economical combination of commodity

price and transportation rate will

determine the commodity offer CCC

accepts.

The ocean carriage of Title II, Pub. L.

480 commodities is subject to sections

901(b) and 901b of the Merchant Marine

Act, 1936, 46 U.S.C. App. sections

1241(b) and 1241f, commonly referred

to as the ‘‘cargo preference laws.’’ These

provisions generally require that

agencies involved in certain export

programs, including Title II, Pub. L. 480,

must assure that at least 75 percent of

such ocean shipments are carried on

U.S.-flag vessels to the extent they are

available at fair and reasonable rates.

CCC will decide if the commodity

purchased is to be shipped on a U.S.-

flag vessel after reviewing the various

lowest landed cost options indicating

the most economical means to achieve

cargo preference requirements. This

involves the use of only U.S.-flag vessel

rates in the lowest landed cost analyses

for that portion of the cargo to be

shipped on U.S.-flag vessels.
6498 Federal Register / Vol. 62, No. 29 / Wednesday, February 12, 1997 / Proposed Rules

As indicated above, CCC procures

packaged commodities on a free along

side (f.a.s.) vessel, or intermodal basis.

These delivery terms do not include

costs of ocean transportation. Since CCC

does not contract for ocean

transportation, CCC will notify the

cooperating sponsor or A.I.D of the

commodity offer accepted based upon

its lowest landed cost analysis. The

cooperating sponsor or A.I.D then issues

its own invitation for bids for the

procurement of transportation for

commodities to which interested ocean

carriers must respond. The cooperating

sponsor or A.I.D must contract with a

vessel to carry the commodity

purchased at the rate used by CCC in

making its lowest landed cost

determination, or a lower rate. If CCC

has determined that a quantity of cargo

must be shipped on a U.S.-flag vessel to

meet cargo preference requirements, the

cooperating sponsor or A.I.D must

contract with a U.S.-flag vessel carrier.

Maritime Security Act of 1996 (MSA)

Section 17 of the Maritime Security

Act of 1996 (‘‘MSA’’) amended section

901b(c) of the Merchant Marine Act,

1936 (46 App. 1241f(c)) to mandate that

CCC follow certain procedures in its

purchasing process for packaged

commodities. The new procedures are

intended to correct a perceived

unfairness to Great Lakes ports

stemming from cargo preference

requirements. Currently no U.S.-flag or

foreign-flag carriers offer service at Great

Lakes ports for this type of cargo. It is

argued that CCC’s purchase of

commodities on the basis of lowest

landed cost utilizing U.S.-flag vessel

rates for the purpose of meeting cargo

preference requirements in the most

economical manner has the effect of

drawing cargo away from Great Lakes

ports because commodity offers for

delivery to Great Lakes ports would not

be considered at that point in the

procurement process. In an effort to

place Great Lakes ports on an equal

footing with other coastal ranges, yet

maintaining cargo preference

requirements, section 17 of the MSA

mandates a change in our purchasing

process. Generally, CCC will now be

required to initially evaluate all

commodity offers received in response

to a particular invitation on a lowest

landed cost basis without regard to the

flag of the vessels offering service. If that

evaluation demonstrates that

commodities offered for delivery at a

particular Great Lakes port represents

the lowest landed cost, CCC must

purchase such commodities for delivery

at that Great Lakes port. This purchasing

requirement is applicable to up to 25

percent of the total annual tonnage of

bagged, processed or fortified

commodities furnished under Title II,

Pub. L. 480.

CCC is still required to assure that,

annually, at least 75 percent of the Title

II cargo is shipped on U.S.-flag vessels.

In implementing this requirement, CCC

is free to purchase commodities on a

lowest landed cost U.S.-flag vessel basis

for cargo offered for delivery to any port

or port range after the 25 percent Great

Lakes quantity is reached.

The new provision requires that a

number of issues be addressed. First,

since CCC generally purchases Title II

commodities on a monthly basis and it

is impossible to determine in advance

the quantity of commodities to be

actually purchased, CCC cannot know,

at any point in the year, when the 25

percent Great Lakes tonnage point is

reached. Consequently, CCC proposes to

administer the 25 percent requirement

on a annual basis. In other words,

beginning with the first purchase in

each cargo preference year (April 1—

March 31), 25 percent or more of the

total monthly purchase may be allocated

to Great Lakes port range on an overall

lowest landed basis. This would allow

CCC the flexibility to take advantage of

seasonal and other surges in service

offered through the Great Lakes ports

during the course of the year.

Section 901b(c) of the Merchant

Marine Act, 1936, as amended, now

requires that CCC allocate to Great Lakes

ports ‘‘any cargoes for which it has’’ the

overall lowest landed cost, but does not

define what may be considered as a

Great Lakes port offer. Clearly, the

lowest f.a.s. vessel offer for export from

Great Lakes ports would qualify. A more

difficult question involves intermodalbridge-point (bridge-point) offers. In

bridge-point movements, the

commodity supplier is responsible for

the transportation and related costs to

deliver the commodity to the designated

U.S. bridge-point location. The ocean

transportation carrier becomes

responsible for the cargo at the bridgepoint location and must transport the

commodities from that point and pay all

related costs to deliver the commodity

onboard the vessel. Such costs include

car unloading, container stuffing (where

applicable), etc. The bridge-point may

not be within the confines of a port

operation and the commodities may be

loaded on a vessel at a port that is in

a different part of the country than the

bridge-point. This raises the issue of

how bridge-point service should be

considered when determining what are

Great Lakes port offers.

Certain interests have suggested that

the purpose of the recent amendment

was to make-up for potential revenue

and employment opportunities lost to

the Great Lakes by virtue of the cargo

preference requirements and that

bridge-point-service that includes cargo

handling; i.e., stuffing containers at

Great Lakes ports contributes to this

goal even if the cargo is ultimately

exported from other ports. For this

reason, it is suggested that any

commodity offers for this type of service

that represent the lowest landed cost

should be viewed as Great Lakes cargo.

On the other hand, if the commodities

are not stuffed into transportation

conveyances at the intermodal bridgepoint at Great Lakes ports and the

carrier merely takes risk of loss to the

cargo, these interests suggest that the

commodity offer should not be

considered as a Great Lakes port range

offer.

While there is certainly some merit to

this analysis, the suggestion raises some

administrative problems. If CCC were to

adopt this suggestion, it appears that it

would have to make some rather

arbitrary decisions as to what

constitutes a port area in order to

determine whether a particular service

facility is geographically part of a Great

Lakes port. Also, the more inclusive

definition could disrupt normal trade

practices of an ocean transportation

carrier. For example, a carrier that

normally takes possession of the cargo

at bridge-point (not within the confines

of the port) because of certain

economies would be forced to utilize a

less favored facility. Furthermore, this

interpretation could counteract efforts to

generate more vessel calls at Great Lakes

ports, because once the 25 percent

annual cargo level is reached by

considering service facilities as

representing Great Lakes ports, CCC

could begin to consider lowest landed

costs on a U.S.-flag vessel basis. This

could eliminate utilization of f.a.s.

vessel offers in the Great Lakes.

For the above reasons, the proposed

rule defines Great Lakes cargo as cargo

offered for delivery f.a.s. vessel.

However, CCC is particularly interested

in receiving comments from all

interested parties concerning this

problem and will take them into

consideration when formulating a final

rule.

In addition to the above changes, CCC

is proposing to clarify § 1496.5(b)(1)

without any substantive change.

List of Subjects in 7 CFR Part 1496

Agricultural commodities; exports.

Accordingly, it is proposed that 7 CFR

part 1496 be revised as follows:
Federal Register / Vol. 62, No. 29 / Wednesday, February 12, 1997 / Proposed Rules 6499

PART 1496—PROCUREMENT OF

PROCESSED AGRICULTURAL

COMMODITIES FOR DONATION

UNDER TITLE II, PUB. L. 480

1. The authority citation for part 1496

is revised to read as follows:

Authority: 7 U.S.C. 1721–1726a; 1731–

1736g–2; 46 U.S.C. App. 1241(b), and 1241(f).

2. In § 1496.5, paragraphs (b)(1) and

(f) are proposed to be revised to read as

follows:

§ 1496.5 Consideration of bids.

* * * * *

(b)(1) Availability of ocean service.

Prior to receipt of offers from

commodity suppliers, CCC will review

ocean freight information from available

sources including but not limited to,

trade journal newspapers, port

publications, steamship publications in

order to determine the availability of

appropriate ocean service.

* * * * *

(f) Great Lakes ports. Commodities

offered for delivery f.a.s. vessel Great

Lakes port range that represent the

overall (foreign and U.S. flag) lowest

landed cost will be awarded on that

basis and will not be evaluated on a

lowest landed cost U.S.-flag basis unless

CCC determines that 25 percent of the

total annual tonnage of bagged,

processed or fortified commodities

furnished under Title II of Public Law

480 has been, or will be, transported

from the Great Lakes port range during

that fiscal year.

Signed at Washington, DC, on February 3,

1997.

Bruce R. Weber,

Acting Executive Vice President,Commodity

Credit Corporation.

[FR Doc. 97–3370 Filed 2–11–97; 8:45 am]

BILLING CODE 3410–05–P

SMALL BUSINESS ADMINISTRATION

13 CFR Part 121

Small Business Size Standards;

Waiver of the Nonmanufacturer Rule

AGENCY: Small Business Administration.

ACTION: Notice of intent to waive the

nonmanufacturer rule for power circuit

breakers, disconnect switches, current

and potential transformers,

autotransformer, surge arresters.

SUMMARY: The Small Business

Administration (SBA) is considering

granting a waiver of the

Nonmanufacturer Rule for Power Circuit

Breakers, Disconnect Switches, Current

and Potential Transformers,

Autotransformer, Surge Arresters. The

basis for a waiver of the

Nonmanufacturer Rule for these

products is that there are no small

business manufacturers or processors

available to supply these products to the

Federal Government. The effect of a

waiver would be to allow an otherwise

qualified Nonmanufacturer to supply

other than the product of a domestic

small business manufacturer or

processor on a Federal contract set aside

for small businesses or awarded through

the SBA 8(a) Program. The purpose of

this document is to solicit comments

and potential source information from

interested parties.

DATES: Comments and sources must be

submitted on or before February 18,

1997.

ADDRESSES: David Wm. Loines,

Procurement Analyst, U.S. Small

Business Administration, 409 3rd Street

S.W., Washington, DC 20416, Tel: (202)

205–6475.

FOR FURTHER INFORMATION CONTACT:

David Wm. Loines, Procurement

Analyst, (202) 205–6475, FAX (202)

205–7324.

SUPPLEMENTARY INFORMATION: Public law

100–656, enacted on November 15,

1988, incorporated into the Small

Business Act the previously existing

regulation that recipients of Federal

contracts set-aside for small businesses

or the SBA 8(a) Program procurement

must provide the product of a small

business manufacturer or processor, if

the recipient is other than the actual

manufacturer or processor. This

requirement is commonly referred to as

the Nonmanufacturer Rule. The SBA

regulations imposing this requirement

are found at 13 CFR 121.406(b). Section

303(h) of the law provides for waiver of

this requirement by SBA for any ‘‘class

of products’’ for which there are no

small business manufacturers or

processors in the Federal market. To be

considered available to participate in

the Federal market on these classes of

products, a small business manufacturer

must have submitted a proposal for a

contract solicitation or received a

contract from the Federal Government

within the last 24 months. The SBA

defines ‘‘class of products’’ based on

two coding systems. The first is the

Office of Management and Budget

Standard Industrial Classification

Manual (SIC). The second is the Product

and Service Code (PSC) established by

the Federal Procurement Data System.

The Small Business Administration is

currently processing a request for a

waiver of the Nonmanufacturer Rule for

Power Circuit Breakers (SIC 3613, PSC

5925), Disconnect Switches (SIC 3613,

PSC 5930), Current and Potential

Transformers (SIC 3612, PSC 5950),

Autotransformer (SIC 3612, PSC 5950),

Surge Arresters (SIC 3643, PSC 5920),

and invites the public to comment or

provide information on potential small

business manufacturers for these

products.

In an effort to identify potential small

business manufacturers, the SBA has

searched the Procurement Automated

Source System (PASS) and Thomas

Register, and the SBA will publish a

notice in the Commerce Business Daily.

The public is invited to comment or

provide source information to SBA on

the proposed waiver of the

Nonmanufacturer Rule for these classes

of products.

Dated: February 6, 1997.

Judith A. Roussel,

Associate Administrator for Government

Contracting.

[FR Doc. 97–3457 Filed 2–11–97; 8:45 am]

BILLING CODE 8025–01–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. 97–NM–12–AD]

RIN 2120–AA64

Airworthiness Directives; Boeing

Model 747 Series Airplanes

AGENCY: Federal Aviation

Administration, DOT.

ACTION: Notice of proposed rulemaking

(NPRM).

SUMMARY: This document proposes to

revise an existing airworthiness

directive (AD), applicable to certain

Boeing Model 747 series airplanes, that

currently requires repetitive inspections

of the access doors to the midspar/

spring beam fuse pins on all engine

pylons to detect cracks on the external

surface; repetitive inspections of each

midspar/spring beam fuse pin to detect

if it protrudes beyond its mating nut by

a specified distance; and repair of any

discrepancy found. The actions

specified by that AD are intended to

prevent migration of this fuse pin,

which, if not detected and corrected in

a timely manner, could result in failure

of the engine pylon and consequent

separation of the engine from the wing.

This new action would increase the

intervals between inspections of the

access doors and each midspar/spring

beam fuse pin, and consequently

decrease the frequency of inspections.

This proposal is prompted by new data

provided the manufacturer indicating