This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents. Prices of

new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

63765

Vol. 65, No. 207

Wednesday, October 25, 2000

OFFICE OF PERSONNEL

MANAGEMENT

5 CFR Part 330

Recruitment, Selection, and Placement

(General)

CFR Correction

In Title 5 of the Code of Federal

Regulations, parts 1 to 699, revised as of

January 1, 2000, on page 210, in the

second column, the first §330.702 is

removed.

[FR Doc. 00–55516 Filed 10–24–00; 8:45 am]

BILLING CODE 1505–01–D

DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection

Service

7 CFR Part 319

Foreign Quarantine Notices

CFR Correction

In Title 7 of the Code of Federal

Regulations, parts 300 to 399, revised as

of January 1, 2000, on pages 322 and

323, beginning in the first column, the

second §319.74–3 and §319.74–4 should

be removed.

[FR Doc. 00–55515 Filed 10–24–00; 8:45 am]

BILLING CODE 1505–01–D

DEPARTMENT OF AGRICULTURE

Farm Service Agency

7 CFR Part 735

RIN 0560–AF13

Amendments to the Regulations for

Cotton Warehouses Regarding the

Delivery of Stored Cotton

AGENCY: Farm Service Agency, USDA.

ACTION: Final rule.

SUMMARY: This final rule codifies the

delivery standard for cotton stored in

warehouses licensed under the United

States Warehouse Act (USWA) and

those warehouses issuing electronic

warehouse receipts under the USWA (7

U.S.C. 241 et seq.). The final rule

adopts, with minor changes based on

public comments, a proposed rule

published in the Federal Register on

May 28, 1999, (64 FR 28938) and an

advanced notice of proposed

rulemaking (ANPRM) published in the

Federal Register on May 26, 1998 (63

FR 28488). The Department of

Agriculture (USDA) is taking this action

as the result of two U.S. District Court

orders that remanded USDA to define

the statutory phrase ‘‘without

unnecessary delay’’ as set forth in the

USWA. Concurrently, several segments

of the cotton industry requested the

implementation of a uniform national

cotton shipping standard for the

delivery of stored cotton. This final rule

amends the regulations covering cotton

to define the USWA statutory phrase

‘‘without unnecessary delay’’ as used in

the USWA, and sets a standard for

determining whether a warehouse

operator delivers stored cotton timely by

establishing a uniform cotton shipping

standard for the delivery of stored

cotton.

EFFECTIVE DATE: October 25, 2000.

FOR FURTHER INFORMATION CONTACT:

Steve Mikkelsen, Deputy Director,

Warehouse and Inventory Division,

Farm Service Agency, STOP 0553, 1400

Independence Avenue, SW.,

Washington, DC 20250–0553; telephone

(202) 720–2121 or FAX (202) 690–3123,

e-mail:

StevelMikkelsen@wdc.fsa.usda.gov.

Persons with disabilities who require

alternative means for communication of

regulatory information (braille, large

print, audiotape, etc.) should contact

USDA’s TARGET Center at (202) 720–

2600 (voice and TDD).

SUPPLEMENTARY INFORMATION:

Executive Order 12866

The Office of Management and Budget

has reviewed this final rule and

determined the rule to be significant for

the purposes of Executive Order 12866.

Cost-Benefit Assessment

A Cost-Benefit Assessment (CBA) was

prepared. The costs associated with the

implementation of the rule will be

minimal to all parties involved. The

CBA summarized the cost and benefit

impact of the rule as follows:

The cotton industry will benefit from

USDA establishing a shipping standard

that it can apply through arbitration or

legal proceedings to determine whether

a warehouse operator is delivering

stored cotton ‘‘without unnecessary

delay.’’ Establishment of a uniform

shipping standard will help: (1)

Maintain the competitiveness of U.S.

cotton in domestic and world markets;

(2) improve the prices that producers

receive in those areas affected by

delivery delays; (3) eliminate any

disruption in commerce due to

uncertainty of delivery expectations;

and (4) a standard that may be applied

to arbitration or legal proceedings to

determine whether a warehouse

operator is delivering cotton ‘‘without

unnecessary delay.’’

Copies of the CBA are available upon

request from the Warehouse and

Inventory Division, Farm Service

Agency, STOP 0553, 1400

Independence Avenue, SW.,

Washington, DC 20250–0553.

Executive Order 12988

This final rule has been reviewed in

accordance with Executive Order 12988.

The provisions of this final rule do not

preempt State laws, are not retroactive,

and do not involve administrative

appeals.

Environmental Evaluation

An environmental evaluation has

determined that this action will not

have significant impact on the quality of

the human environment. Therefore,

neither an Environmental Assessment

nor an Environmental Impact Statement

is needed.

Executive Order 12612

It has been determined that this final

rule is consistent with the Federalism

principals espoused in Executive Order

12612, and does not warrant the

preparation of a Federalism Assessment.

Executive Order 12372

This program/activity is not subject to

the provisions of Executive Order

12372, which require intergovernmental

63766 Federal Register / Vol. 65, No. 207 / Wednesday, October 25, 2000 / Rules and Regulations

consultation with State and local

officials. See the notice related to 7 CFR

part 3015, subpart V, published at 48 FR

29115 (June 24, 1983).

Unfunded Mandates Reform Act of

1995

This final rule contains no Federal

mandates under the regulatory

provisions of Title II of the Unfunded

Mandates Reform Act (UMRA) of 1995

for State, local, and tribal governments

or the private sector. Thus, this final

rule is not subject to the requirements

of sections 202 and 205 of the UMRA.

Paperwork Reduction Act

The amendments set forth in this rule

do not affect information collection or

record keeping requirements.

Regulatory Flexibility Act

It has been determined that the

Regulatory Flexibility Act is not

applicable to this final rule because this

rule will not have a significant effect on

a substantial number of small

businesses. Licensing under the USWA

is strictly voluntary upon the part of

each warehouse operator.

Background

Since the early 1960’s, the timely

delivery and shipping of stored cotton

(cotton flow) has been a persistent

problem throughout the cotton industry.

While cotton shippers and cotton

merchants require timely delivery and

shipping to meet the demands of the

marketplace, cotton warehouse

operators contended that delivery and

shipping demands placed on them by

shippers and merchants are

unreasonable and exceeded warehouse

delivery capabilities. When delivery and

shipping delays began to occur during

the 1995/96 crop year several cotton

shippers filed complaints with the Farm

Service Agency (FSA). These shippers

requested FSA to investigate cotton

shipment delays and to suspend the

Federal license of those warehouses that

had not delivered cotton ‘‘without

unnecessary delay’’ as required by the

USWA (7 U.S.C. 241 et seq.). FSA

personnel investigated and found that a

lack of common terminology and lack of

a standard process for requesting

services may have contributed to the

confusion and appearance of longer

shipping delays than actually occurred.

Besides filing complaints with FSA,

several shippers brought action in U.S.

District Court against two cotton

warehouse operators. In each case the

key issue for the courts was that USDA

had not issued regulatory guidance on

the use and meaning of the statutory

phrase ‘‘without unnecessary delay’’

contained in the USWA. Ultimately, the

shippers elected to dismiss their suits

opting instead to request that the

statutory phrase ‘‘without unnecessary

delay’’ as set forth in the USWA be

remanded to USDA for further

determination under the doctrine of

primary jurisdiction. At the same time,

several segments of the cotton industry

requested USDA to implement a

national uniform cotton shipping

standard.

As a result of these events, on May 26,

1998, FSA published a ANPRM in the

Federal Register (63 FR 28488). The

ANPRM sought public comments on

two options and asked specific

questions regarding a proposed National

Cotton Flow Standard. Option I

contained methods for defining

‘‘without unnecessary delay,’’

established both a uniform cotton

shipping standard and a dispute

resolution mechanism, but limited

further government involvement in

regulating the standard. In addition to

the items contained in Option I, Option

II offered standardized definitions,

terminologies, dispute mediation, a

national cotton flow shipping status

report, and operated with user fees

under a greater USDA regulatory role.

Public comments favored Option I and

strongly expressed a conviction that

USDA should establish a cotton

shipping standard and allow

enforcement just to be handled by the

cotton industry without; USDA

involvement, assessment of user fees, or

increased governmental costs. A

complete summary of the comments

received in response to the ANPRM can

be found in the proposed rule in the

Federal Register of May 28, 1999 (64 FR

28938).

FSA published a proposed rule

seeking public comments on setting

forth a national cotton shipping

standard that defined ‘‘without

unnecessary delay’’. See, May 28, 1999,

Federal Register (64 FR 28938). This

standard was based upon weekly

deliveries of at least 4.5 percent of a

warehouse operator’s licensed storage

capacity, Commodity Credit Corporation

(CCC) approved storage capacity, or

other storage capacity as determined to

be in effect for the week of the

shipment. The industry presented 4.5

percent as the level that would best

expedite the delivery and shipment of

U.S. cotton. The industry also

recommended that CCC’s Cotton Storage

Agreement (CSA) should be the vehicle

of regulatory authority used by USDA to

establish the cotton flow standard.

USDA believed that a delivery and

shipping standard should not be solely

based on the CSA, because the CSA and

any standard that grew out of it only

applied to cotton in which CCC had an

interest. USDA believed that a delivery

and shipping standard based on the

USWA would have a broader

application as the industry receipted

about 80 to 90 percent of all cotton

under USWA’s electronic warehouse

receipt authority and the proposed rule

reflected that larger applicability.

The proposed rule required an

established cotton industry arbitration

system to resolve all disputes and

compliance without any USDA

involvement, user fees or governmental

costs. The proposed rule presented a

provision that required any party who

requested or initiated FSA’s

involvement in a shipping standard

issue would be responsible for any cost

incurred by FSA.

Summary of Public Comments

Concerning the Proposed Rule

FSA received 31 responses from four

sectors of the trade-industry as follows:

six cotton trade associations, 22 cotton

warehouse operators, two cotton

merchants, and one electronic cotton

warehouse receipt provider. Some

responses contained multiple

comments. One respondent favored a

standard based on 4.5 percent of

inventory on hand; 23 respondents

favored a standard based on weekly

deliveries of 4.5 percent of a warehouse

operator’s storage capacity; 18

respondents favored enforcement by the

cotton industry with no USDA

involvement; six respondents favored

no user fees; six respondents favored no

increased governmental costs; seven

respondents favored dispute resolution

using either a cotton industry voluntary

arbitration system or the court system;

12 respondents suggested binding

arbitration by the cotton industry; 12

respondents suggested that any

initiating or requesting parties should be

responsible for all costs incurred by the

FSA regarding a shipping standard

issue; nine respondents suggested

changing the phrase ‘‘will be’’ at 7 CFR

735.202 (a) to ‘‘may be’’; two

respondents suggested deletion of 7 CFR

735.202, Compliance and Dispute

Resolution; and one respondent

suggested that adherence to the standard

should be a CCC condition of eligibility

and opposed any restrictions on the

issuance of electronic warehouse

receipts.

After analyzing the comments, FSA

has decided to proceed with the

issuance of this final rule, with some

slight modifications from the proposed

rule in response to the comments.

Several respondents specifically

objected to USDA’s mandated

Federal Register / Vol. 65, No. 207 / Wednesday, October 25, 2000 / Rules and Regulations 63767

arbitration for disputes where the

parties had not previously agreed to

arbitration and would be required to

arbitrate. These respondents argued that

their constitutional rights would be

infringed upon as they would not be

free to choose the forum for resolving

their disputes, and their property rights

could be affected without due process of

the law. The respondents’ claims as to

contra-constitutionality were overstated;

however, USDA did believe that they

should change this provision to indicate

a permissive use of arbitration where

the parties so desired. Accordingly,

USDA has amended § 735.202 (a) to

change ‘‘will be’’ to ‘‘may be’’ to

indicate that where the parties are able

to arbitrate the issue, they should be

allowed to do so, but not required by

regulation. In addition, the word

‘‘relevant’’ will be inserted into

§ 735.201 to clarify that a

warehouseman must meet the delivery

standard for the week of the shipment

in question.

As with the proposed rule, the final

rule will define ‘‘without unnecessary

delay,’’ through the establishment of a

uniform cotton delivery standard based

upon weekly deliveries of 4.5 percent of

a warehouse operator’s licensed storage

capacity or CCC approved capacity or

other capacity in effect for the relevant

week in question. However,

enforcement of the standard through

arbitration is no longer mandatory. The

final rule continues to include a

provision that requires any party who

requests or initiates FSA’s involvement

in a shipping standard issue to be

responsible for any cost incurred by

FSA.

USDA believes this final rule provides

an identifiable standard for the delivery

and shipment of cotton with the option

of arbitrating, has minimal FSA

oversight, will best meet the tradeindustry’s aspirations to expedite the

delivery and shipment of U.S. cotton

into marketing trade channels and

enhance prices paid producers while

reducing the cost of handling cotton.

The provisions in this final rule are

applicable to cotton warehouse

operators licensed under the USWA and

any warehouse operators who issue

electronic warehouse receipts under the

USWA.

List of Subjects in 7 CFR Part 735

Administrative practice and

procedure, Cotton, Delivery, Reporting

and record keeping requirements,

Shipping, Surety bonds, Warehouses.

Accordingly, the provisions of 7 CFR

part 735 are amended as follows:

PART 735—COTTON WAREHOUSES

1. The authority citation for 7 CFR

part 735 continues to read as follows:

Authority: 7 U.S.C. 241 et seq.

2. Section 735.2 is amended by

adding paragraph (jj).

§ 735.2 Terms defined.

* * * * *

(jj) Force majeure. Severe weather

conditions, fire, explosion, flood,

earthquake, insurrection, riot, strike,

labor dispute, act of civil or military

authority, non-availability of

transportation facilities, or any other

cause beyond the control of the

warehouseman that renders

performance impossible.

§§ 735.106–735.199 [Reserved]

3. Sections 735.106 through 735.199

are added and reserved.

4. Following § 735.199 an

undesignated center heading and

§§ 735.200 through 735.202 are added to

read as follows:

Delivery and Shipping

§ 735.200 Applicability.

The cotton shipping standard set forth

in § 735.201 is applicable to all cotton

warehousemen licensed under the Act

and to all warehousemen that issue

electronic warehouse receipts through

an authorized electronic warehouse

receipt provider in accordance with part

735 regardless of whether the

warehouse is licensed under the Act.

§ 735.201 Cotton shipping standard.

Unless prevented from doing so by

force majeure, a warehouseman

identified in § 735.200 shall deliver

stored cotton without unnecessary

delay. A warehouseman shall be

considered to have delivered cotton

without unnecessary delay, if for the

week in question, the warehouseman

has delivered or staged for scheduled

delivery at least 4.5 percent of either

their licensed storage capacity or

Commodity Credit Corporationapproved storage capacity or other

storage capacity as determined by the

Secretary to be in effect during the

relevant week of shipment.

§ 735.202 Compliance and dispute

resolution.

(a) Any claim for noncompliance with

the cotton shipping standard may be

resolved by the parties involved through

established industry, professional, or

mutually agreed upon arbitration

procedures. The arbitration procedures

shall be nondiscriminatory and provide

each person equal access and protection

relating to the cotton shipping standard.

(b) No arbitration determination or

award resulting from noncompliance

with the shipping standard shall affect,

obligate, or restrict the Service’s

authority to provide, administer, and

regulate the issuance of a license,

receipt, contractual agreement, or

authorized electronic warehouse receipt

provider system in accordance with the

Act.

(c) The Service shall not settle

unresolved disputes involving the

cotton shipping standard or associated

damages.

(d) In the event a party requests

assistance from or initiates the

involvement of the Service in a matter

relating to the cotton shipping standard,

the initiating party shall be responsible

for all costs incurred by the Service.

Before any such assistance is provided,

the initiating party shall make payment

to the Service in an amount equal to the

Service’s good faith estimate of costs

and expenses that will be incurred in

fulfilling the request. Costs incurred that

exceed the Service’s good faith estimate

will be the responsibility of the

initiating party.

Signed at Washington, D.C., on October 19,

2000.

Keith Kelly,

Administrator, Farm Service Agency.

[FR Doc. 00–27346 Filed 10–24–00; 8:45 am]

BILLING CODE 3410–05–P

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1220

[No. LS–00–04]

Soybean Promotion and Research:

Amend the Order To Adjust

Representation on the United Soybean

Board

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Final rule.

SUMMARY: This final rule adjusts the

number of members for certain States on

the United Soybean Board (Board) to

reflect changes in production levels that

have occurred since the last time the

Board was reapportioned in 1997. These

adjustments are required by the Soybean

Promotion and Research Order (Order).

The results of the adjustments are an

additional member for Kansas and one

less member for Maryland. As a result

of these changes, the total Board

membership will remain at 62 members.

These changes to the Board are effective

with the Secretary’s 2001 appointments.

EFFECTIVE DATE: November 24, 2000.