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

15050 

Vol. 79, No. 52 

Tuesday, March 18, 2014 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 983 

[Doc. No. AMS–FV–12–0068; FV13–983–1 

PR] 

Pistachios Grown in California, 

Arizona, and New Mexico; Modification 

of Aflatoxin Regulations 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule invites 

comments on revisions to the aflatoxin 

sampling regulations currently 

prescribed under the California, 

Arizona, and New Mexico pistachio 

marketing order (order). The order 

regulates the handling of pistachios 

grown in California, Arizona, and New 

Mexico, and is administered locally by 

the Administrative Committee for 

Pistachios (Committee). This action 

would allow the use of mechanical 

samplers (auto-samplers) for in-line 

sampling as a method to obtain samples 

for aflatoxin analysis. The use of autosamplers is expected to reduce handler 

costs by providing a more efficient and 

cost-effective process. 

DATES: Comments must be received by 

April 17, 2014. 

ADDRESSES: Interested persons are 

invited to submit written comments 

concerning this proposal. Comments 

must be sent to the Docket Clerk, 

Marketing Order and Agreement 

Division, Fruit and Vegetable Program, 

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 proposal 

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: 

Andrea Ricci, Marketing Specialist, or 

Martin Engeler, Regional Director, 

California Marketing Field Office, 

Marketing Order and Agreement 

Division, Fruit and Vegetable Program, 

AMS, USDA; Telephone: (559) 487– 

5901, Fax: (559) 487–5906, or Email: 

Andrea.Ricci@ams.usda.gov or 

Martin.Engeler@ams.usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Jeffrey Smutny, 

Marketing Order and Agreement 

Division, Fruit and Vegetable Program, 

AMS, USDA, 1400 Independence 

Avenue SW., STOP 0237, Washington, 

DC 20250–0237; Telephone: (202) 720– 

2491, Fax: (202) 720–8938, or Email: 

Jeffrey.Smutny@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This 

proposal is issued under Marketing 

Agreement and Order No. 983, both as 

amended (7 CFR part 983), regulating 

the handling of pistachios grown in 

California, Arizona, and New Mexico, 

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 proposed rule in 

conformance with Executive Orders 

12866, 13175, and 13563. 

This proposal has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. This proposed 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 proposed rule invites comments 

on revisions to the aflatoxin sampling 

regulations currently prescribed under 

the order. This proposal would allow 

the use of mechanical samplers (autosamplers) as an additional method to 

obtain lot samples for aflatoxin analysis. 

All auto-samplers would need to be 

approved by and be subject to 

procedures and requirements 

established by the USDA Federal-State 

Inspection Service prior to their use. 

The proposed rule was unanimously 

recommended by the Committee at its 

meeting held on August 19, 2013. 

Section 983.50 of the order provides 

authority for aflatoxin regulations that 

establish aflatoxin sampling, analysis, 

and inspection requirements applicable 

to pistachios to be shipped for human 

consumption in domestic and export 

markets. Aflatoxin regulations are 

currently in effect for pistachios 

shipped to domestic markets. 

Section 983.150 of the order’s rules 

and regulations contains specific 

requirements regarding sampling and 

testing of pistachios for aflatoxin. 

Paragraph (d)(1) of that section provides 

that a sample shall be drawn from each 

lot of pistachios and such samples shall 

meet specific weight requirements 

according to the size of the lot. 

The current method of collecting 

samples of pistachios to be tested 

requires hand sampling of static lots by, 

or under the supervision of, an 

inspector of the Federal-State Inspection 

Service (inspector). This process 

requires handler personnel to stage the 

lots to be sampled, which requires 

moving large containers around with a 

forklift. This process utilizes a 

considerable amount of time and 

warehouse space. Inspectors are then 

required to manually conduct the 

sampling by drawing samples from the 

containers, which is very labor 

intensive. Once the lot sample is 

collected, the inspector prepares test 

samples for aflatoxin analysis. 

Since the order’s promulgation in 

2004, the volume of open inshell 

pistachios processed annually has 

increased significantly, from 165 

million pounds to 354 million pounds 

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Federal Register / Vol. 79, No. 52 / Tuesday, March 18, 2014 / Proposed Rules 15051 

in the 2011–12 production year. This 

change in volume has significantly 

increased the amount of warehouse 

space and handler labor needed to stage 

lots for sampling. It has also driven up 

the total labor costs associated with 

sampling, as the number of lots to be 

sampled has increased significantly. 

If this rule is implemented, handlers 

would have the option of using 

mechanized sampling instead of manual 

sampling. Automatic samplers in 

handlers’ processing facilities would 

mechanically draw samples of 

pistachios as they are being processed. 

This would make the sampling process 

more efficient by eliminating the extra 

warehouse space and handler labor 

needed for staging static lots for 

sampling. In addition, the labor costs of 

manual sampling would be eliminated, 

further reducing handler costs. A 

discussion of the costs is included in 

the Initial Regulatory Flexibility section 

of this document. 

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 

businesses 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. 

There are approximately 23 handlers 

of California, Arizona, and New Mexico 

pistachios subject to regulation under 

the order and approximately 990 

pistachio producers in the regulated 

area. Small agricultural service firms are 

defined by the Small Business 

Administration (SBA) (13 CFR 121.201) 

as those having annual receipts of less 

than $7,000,000, and small agricultural 

producers are defined as those having 

annual receipts of less than $750,000. 

Currently, about 70 percent of 

handlers ship less than $7,000,000 

worth of pistachios on an annual basis 

and would be considered small 

businesses under the SBA definition. 

Data provided by the Committee 

regarding the size of the 2012 crop 

indicates that approximately 80 percent 

of producers delivered less than 375,000 

pounds of assessable dry weight of 

pistachios. Using an estimated price of 

$2 per pound of pistachios, this would 

equate to less than $750,000 in receipts; 

thus, 80 percent of producers would be 

considered small businesses according 

to the SBA definition. 

This proposal would modify the 

aflatoxin sampling regulations currently 

prescribed under § 983.150(d) of the 

order’s rules and regulations. This rule 

would allow the use of auto-samplers as 

a method to obtain samples for aflatoxin 

analysis. Currently, only manual handdrawn sampling from static lots is 

permitted. Allowing the use of autosamplers for in-line sampling would 

streamline the sampling process for 

pistachios. It is expected to make the 

sampling process more efficient by 

eliminating the time and space needed 

for staging and inspecting static lots, 

reducing the amount of labor, and 

therefore reducing handler costs. 

Authority for this action is provided in 

§ 983.50 of the order. 

The Committee estimates the current 

method of sampling to range in cost 

from $135 to $170 per lot. This expense 

includes the warehouse space and 

employee labor needed to stage a lot for 

inspection and the costs of the 

inspection. The initial expense of 

purchasing an auto-sampler ranges from 

as low as $1,000 to as high as $5,000. 

The cost of collecting samples with the 

auto-sampler is estimated at about $5 

per lot, which is significantly lower 

than the static lot sampling method, 

which ranges from $135 to $170 per lot. 

The following example is used to 

illustrate potential savings for a handler 

that processes 3,000,000 pounds of 

pistachios per year. Assuming a lot size 

of 50,000 pounds, this handler would 

require inspection on 60 lots of 

pistachios (3,000,000 ⁄ 50,000). Under 

the current manual sampling method, 

this would result in a total sampling 

cost of $8,100 (60 × $135). If this 

handler purchased an automatic 

sampler for $5,000, the total sampling 

cost (including equipment) would be 

$5,300 ($5,000 + $5 cost per lot to pull 

the samples). Thus, in this example the 

handler would save $2,800 in the first 

year of operation. After the first year, 

the savings would increase because 

there would be no additional equipment 

cost. Applying this on an industry-wide 

basis, the aggregate cost savings could 

be significant, considering recent 

shipment levels have exceeded 

300,000,000 pounds of pistachios. 

Based on these cost estimates and the 

example provided, use of automatic 

samplers could provide a significant 

cost saving to the industry. The 

potential cost savings for individual 

handlers would vary, depending on the 

size and structure of their operation. 

Each handler would need to evaluate 

their operation to determine which 

method of sampling best fits their needs. 

This proposal would provide an 

additional option for sampling that does 

not currently exist for handlers. 

The Committee discussed alternatives 

to this change, including continuing to 

operate under the current aflatoxin 

sampling procedures. However, the 

Committee unanimously agreed that 

adding the option to use mechanical 

sampling equipment would provide 

handlers with a more efficient and costeffective sampling alternative to the 

manual sampling process. 

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. 0581–0215, 

Pistachios Grown in California, Arizona, 

and New Mexico. 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 proposed rule would modify 

aflatoxin sampling regulations currently 

prescribed under the California, 

Arizona, and New Mexico pistachio 

marketing order. Accordingly, this 

action would not impose any additional 

reporting or recordkeeping requirements 

on either small or large pistachio 

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. 

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. 

USDA has not identified any relevant 

Federal rules that duplicate, overlap or 

conflict with this proposed rule. 

In addition, the Committee’s meeting 

was widely publicized throughout the 

pistachio industry and all interested 

persons were invited to attend the 

meeting and participate in Committee 

deliberations on all issues. Like all 

Committee meetings, the August 19, 

2013, meeting was a public meeting and 

all entities, both large and small, were 

able to express 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. 

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15052 Federal Register / Vol. 79, No. 52 / Tuesday, March 18, 2014 / Proposed Rules 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at: www.ams.usda.gov/

MarketingOrdersSmallBusinessGuide. 

Any questions about the compliance 

guide should be sent to Jeffrey Smutny 

at the previously mentioned address in 

the FOR FURTHER INFORMATION CONTACT

section. 

A 30-day comment period is provided 

to allow interested persons to respond 

to this proposal. Thirty days is deemed 

appropriate because the industry would 

like the modified regulation to be in 

place prior to the 2014–15 production 

year, which begins September 1, 2014. 

This regulation would need to be in 

effect before the production year to 

allow handlers to install auto-sampling 

equipment prior to harvest. All written 

comments timely received will be 

considered before a final determination 

is made on this matter. 

List of Subjects in 7 CFR Part 983 

Marketing agreements and orders, 

Pistachios, Reporting and recordkeeping 

requirements. 

For the reasons set forth in the 

preamble, 7 CFR part 983 is proposed to 

be amended as follows: 

PART 983—PISTACHIOS GROWN IN 

CALIFORNIA, ARIZONA, AND NEW 

MEXICO 

■ 1. The authority citation for 7 CFR 

part 983 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Section 983.150 is amended by 

revising paragraph (d)(1) to read as 

follows: 

§ 983.150 Aflatoxin regulations. 

* * * * * 

(d) * * * 

(1) Samples for testing. Prior to 

testing, each handler shall cause a 

representative sample to be drawn from 

each lot (‘‘lot samples’’) of sufficient 

weight to comply with Tables 1 and 2 

of this section. 

(i) At premises with mechanical 

sampling equipment (auto-samplers) 

approved by the USDA Federal-State 

Inspection Service, samples shall be 

drawn by the handler in a manner 

acceptable to the Committee and the 

USDA Federal-State Inspection Service. 

(ii) At premises without mechanical 

sampling equipment, sampling shall be 

conducted by or under the supervision 

of an inspector, or as approved under an 

alternative USDA-recognized inspection 

program. 

* * * * * 

Dated: Feb. 28, 2014. 

Rex A. Barnes, 

Associate Administrator, Agricultural 

Marketing Service. 

[FR Doc. 2014–05834 Filed 3–17–14; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF AGRICULTURE 

Rural Business-Cooperative Service 

Rural Housing Service 

Rural Utilities Service 

Farm Service Agency 

7 CFR Part 1940 

RIN 0570–AA30 

Methodology and Formulas for 

Allocation of Loan and Grant Program 

Funds 

AGENCY: Rural Business-Cooperative 

Service, Rural Housing Service, Rural 

Utilities Service, and Farm Service 

Agency, USDA. 

ACTION: Proposed rule. 

SUMMARY: The Rural BusinessCooperative Service (RBS) is proposing 

to amend its regulations found in 7 CFR 

part 1940, subpart L for allocating 

program funds to its State Offices. RBS 

is proposing to amend 7 CFR part 1940, 

subpart L to add three programs—the 

Rural Energy for America Program, the 

Value-Added Producer Grant program, 

and the Intermediary Relending 

Program. In addition, RBS is proposing 

revisions to its state allocation formulae 

for existing programs within 7 CFR part 

1940, subpart L to account for changes 

in data reported by the U.S. Bureau of 

the Census’ decennial Census. RBS is 

also proposing to make various other 

changes including: revising the weight 

percentages associated with each of the 

allocation criteria; providing flexibility 

in determining when not to make state 

allocations for a program; restricting the 

use of the transition formula and 

changing the limitations on how much 

program funds can change when the 

transition formula is used; adding 

provisions for making state allocation 

for other RBS programs, including new 

ones; and providing consistency, where 

necessary, in the allocation of RBS 

program funds to State Offices. 

DATES: Written comments must be 

received on or before May 19, 2014 to 

be assured of consideration. 

ADDRESSES: Submit your comments on 

this rule by any of the following 

methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Mail: Submit written comments via 

the U.S. Postal Service to the Branch 

Chief, Regulations and Paperwork 

Management Branch, U.S. Department 

of Agriculture, STOP 0742, 1400 

Independence Avenue SW., 

Washington, DC 20250–0742. 

• Hand Delivery/Courier: Submit 

written comments via Federal Express 

Mail, or other courier service requiring 

a street address, to the Branch Chief, 

Regulations and Paperwork 

Management Branch, U.S. Department 

of Agriculture, 300 7th Street SW., 7th 

Floor, Washington, DC 20024. 

All written comments will be 

available for public inspection during 

regular work hours at the 300 7th Street 

SW., 7th Floor address listed above. 

FOR FURTHER INFORMATION CONTACT: 

Chad Parker, Deputy Admininstrator 

Business Programs, Rural BusinessCooperative Service, U.S. Department of 

Agriculture, STOP 3220, 1400 

Independence Avenue SW., 

Washington, DC 20250–3225; email: 

chad.parker@wdc.usda.gov; telephone 

(202) 720–7558. 

SUPPLEMENTARY INFORMATION: 

Executive Order 12866, Classification 

This rule has been determined to be 

not significant for purposes of Executive 

Order 12866 and has not been reviewed 

by the Office of Management and 

Budget. 

Programs Affected 

The Catalog of Federal Domestic 

Assistance Program numbers for the 

programs affected by this action are 

10.352, Value-Added Producer Grant 

Program; 10.767, Intermediary 

Relending Program; 10.768, Business 

and Industry Guaranteed Loan Program; 

10.769, Rural Business Enterprise Grant 

Program; 10.773, Rural Business 

Opportunity Grant Program, 10.868, 

Rural Energy for America Program. 

Executive Order 12372, 

Intergovernmental Consultation 

This action is not subject to the 

provisions of Executive Order 12372, 

which requires intergovernmental 

consultation with state and local 

officials. 

Executive Order 12988, Civil Justice 

Reform 

This proposed rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. The Agency has 

determined that this rule meets the 

applicable standards provided in 

section 3 of the Executive Order. 

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