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### United States Department of Agriculture Animal and Plant Health Inspection Service August 2011 Initial Regulatory Flexibility Analysis
Proposed Rule APHIS 2011-0073 RIN 0579-AD54 Importation of Oversized Dracaena Plants from Costa Rica

Policy & Program Development Policy Analysis & Developmenti 

### Summary
Under the current regulations, Dracaena spp. plants that are 18 in ches or less in height may be imported into the United States. The proposed amendment allow Dracaena spp. plants up to 54 inches in height to be imported into th e continental United States from Costa Rica. The proposal would requir e that all Dracaena spp. plants entering the continental United States from Costa Rica be subject to integrated pest risk management measures to reduce pest risks.
Dracaena spp. plants of any size would not be allowe d to enter Hawaii and U.S. territories from Costa Rica. The United States imports approximately 25 million Dracaena spp. plants from Costa Rica annually. On average, APHIS intercepts and fumigates over 8 percent of the Dracaena shipments and destroys less than 1 percent. Producing Dracaena spp. plants under the proposed systems approach would reduce pest infestations and subsequently pest interceptions and costs of fumigation or destruction of sh ipments at ports of entry. The oversized Dracaena spp. plants would be of greater value than the smaller plants currently allowed entry, and we expect U.S. nurseries would adjust to new marketing opportunities afforded by the larger plants. While mo st U.S. nurseries and other entities that may be affected by the proposed rule are small, eff ects of the proposed rule are undetermined as APHIS does not have information about nurseries that produce Dracaena spp. plants. APHIS invites public comment on the potentia l effects of the proposed rule.ii 

### Table of Contents Summary ....................................................................................................................... ....... i Introduction .................................................................................................................. ....... 3 Initial Regulatory Flex ibility Analysis ................................................................................ 2 Reasons Action is Being Considered .............................................................................. 2 Objectives of and Legal Basis for the Rule .................................................................... 2 Potentially Affected Small Entities ................................................................................. 3 Projected Reporting, Recordkeeping, a nd Other Compliance Requirements ................. 4 Duplication, Overlap, or Conflict with Existing Rules and Regulations ........................ 4 Alternatives to minimize Significant Economic Impacts of the Rule ............................. 5

References .................................................................................................................... ....... 6iii 

### Introduction

Whole Dracaena plants are allowed into the United States including Hawaii if they meet the size requirements of 7 CFR 319.37 – 2(b)(6 )(i), i.e., a maximum of 460 millimeters or approximately 18 inches from the soil line (t op of rooting zone for plants produced by air layering) to the farthest termin al growing point. The proposed ru le would amend the regulations by increasing the maximum allowable size of Dracaena plants imported from Costa Rica to 137.16 centimeters or approximately 54 inches. The ru le would also require that plants imported from Costa Rica be in compliance with the Bila teral Operational Workplan agreed to by APHIS and the National Plant Protection Organization of Costa Rica. Workplan requirements include participant approval and registra tion, training, pest management pl ans and practices, and facility inspection. Dracaena plants imported from Costa Rica would only be allowed into the continental United States, not into Hawaii and U.S. territories.
Dracaena is imported in the form of seeds, cu ttings in flask, and whole plants, from Canada, China, Costa Rica, Mexico, the Netherla nds, and a few other countries, with Costa Rica being one of the major sources. Over the pe riod 2006 to 2010, the United States imported an average of 25.3 million Dracaena plants from Costa Rica annually. Over the same period, APHIS intercepted and fumigated over 8 percent of the Dracaena plants entering the United States from Costa Rica, and intercepted and destroyed less than 1 percent. With integrated pest risk management measures in place, the pest infestat ion rate and consequently the pest interception rate would likely be reduced. Over the five-y ear period, 2006 to 2010, APHI S’ cost to fumigate2 Dracaena plants from Costa Rica averaged $22,964 per year. 1 A reduction in the pest interception rate would represen t potential savings to the Agenc y. Costa Rica expects to export two 40-foot containers of oversized Dracaena plants each week to the United States. 

### Initial Regulatory Flexibility Analysis
The Regulatory Flexibility Act requires agencies to evaluate the potential effects of their proposed and final rules on small businesses, small organizations, and small governmental jurisdictions. Section 60 3 of the Act requires agencies to pr epare and make available for public comment an initial regulatory flex ibility analysis that describe s expected impacts of a proposed rule on small entities. Reasons Action is Being Considered APHIS is responding to a request from Cost a Rica to allow the entry into the United States of oversized Dracaena plants, that is, plants up to appr oximately 54 inches in height. The proposed systems approach would mitigate pest ri sks for the oversized plants as well as for plants that are currently allowed entry (not more than 18 inches in height), and is expected to reduce pest infestation rates, and consequently interception rates and port-of-entry treatment

costs. Objectives of and Legal Basis for the Rule The objective of the rule is to increase the maximum allowable size of Dracaena plants imported from Costa Rica. In addition, Dracaena imports would take place under phytosanitary

1 Source: William Aley, PPQ APHIS.3 requirements provided in the Bilateral Dracaena Operational Workplan. 2 Dracaena plants would be allowed only into the continental United States, not into Hawaii and U.S. territories. This action is authorized by the Plant Protection Act of June 20, 2000, as amended. Section 412(a), 7 U.S.C. 7712(a), which authorizes the Secretary of Agriculture to prohibit or restrict the importation, entry, e xportation, or movement in interstate commerce of any plant, plant part, or article if the Secretary determines the prohibition or restriction is necessary to prevent the dissemination of a plan t pest within the United States . This rule would amend 7 CFR 319.37 – 2(b)(6)(i). Potentially Affected Small Entities For the purpose of this analysis and follo wing the Small Business Administration (SBA) guidelines, the entities potentially affected by the proposed rule are classified within the following industries, as categorized by the Nort h American Industry Classification System: Nursery and Tree Production ( NAICS 111421), Floriculture Pr oduction (NAICS 111422), Other Miscellaneous Non Durable Goods Wholesaler s (NAICS 424990), and Fl ower Nursery Stock and Florists’ Supplies Merchant Wholesalers (NAICS 424930). According to the Census of Agriculture, entities categorized in Nursery and Tree Production and Floriculture Production included 52,845 farms in 2007, and represented three percent of all farms in the United States. These entities are considered small by SBA standards if

2 This is a written agreement between APHIS and Costa Ri ca’s National Phytosanitary Service of the Ministry of Agriculture and Husbandry. The agr eement outlines the conditions for grow ing, packing, and exporting Dracaena plants to the United States.4 their annual sales are $750,000 or le ss. Over 93 percent of the farm s in these industry categories had annual sales of less than $500,000. 3
Establishments classified as Other Misc ellaneous Non Durable Goods Wholesalers (NAICS 424990) and Flower Nu rsery Stock and Florists’ S upplies Merchant Wholesalers (424930) are considered small by SBA standards if they employ not more than 100 persons. According to the 2007 Survey of Business Owners, approximately 88 and 98 percent, respectively, of the establishments in these two categories that operated th e entire year employed fewer than 100 people and are consid ered small by SBA standards. The oversized Dracaena spp. plants would be of greater value than the smaller plants currently allowed entry, and we expect U.S. nurseries would adjust to new marketing opportunities afforded by the larger pl ants. The larger plants retail for at least twice as much as the smaller plants. APHIS does not know the nu mber of entities in the industries identified above that import or grow Dracaena plants, or the portion of total in come that is derived from the sale of Dracaena; we invite public comment on the potential impacts of the proposed rule. Projected Reporting, Recor dkeeping, and Other Compliance Requirements There is no significant additional repor ting, recordkeeping, and other compliance requirements that would result from this proposed rule. Duplication, Overlap, or Conflict with Existing Rules and Regulations APHIS has not identified any dup lication, overlap, or conflict of the proposed rule with other Federal rules.

3 The nursery and floriculture industries are representative of other agricultural and non-agricultural industries in terms of being comprised largely of small entities.5 Alternatives to minimize Signifi cant Economic Impacts of the Rule We do not expect the proposed rule to resu lt in significant economi c impacts, but have prepared this initial regulatory flexibility analysis because of our limited understanding of the Dracaena market in the United States and possible ec onomic effects of the rule on small entities. We welcome information about the production, im portation, and sale of Dracaena plants in the United States and public co mment on potential impacts of the proposed rule.6 

### References
Census of Agriculture, 2007, http://www.agcensus.usda.gov/Publications/2007/Full_Report/index.asp Survey of Business Owners, 2007 , http://factfinder.census.go v/servlet/IBQTable?_bm=y&- geo_id=D&-ds_name=SB0700CSA09&-_lang=en U.S. Small Business Administration. U.S. Small Business Administration: Table of Small Business Size Standards Match to North American Industry Classification System http://www.sba.gov/idc/groups/public/docum ents/sba_homepage/serv_sstd_tablepdf.pdf