4970 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Parts 317 and 381

[Docket No. 98–005P]

RIN 0583–AC60

Nutrition Labeling of Ground or

Chopped Meat and Poultry Products

and Single-Ingredient Products

AGENCY: Food Safety and Inspection

Service, USDA.

ACTION: Proposed rule.

SUMMARY: The Food Safety and

Inspection Service (FSIS) is proposing

to amend the Federal meat and poultry

products inspection regulations to

require nutrition labeling of the major

cuts of single-ingredient, raw meat and

poultry products, unless an exemption

applies. For these products, FSIS is

proposing to make the guidelines

currently in place for the voluntary

nutrition labeling program mandatory.

Thus, the Agency is proposing to

require that nutrition information be

provided for these products either on

their label or at their point-of-purchase.

During the most recent surveys of retail

stores, the Agency did not find

significant participation in its voluntary

nutrition labeling program, which

covers the major cuts of singleingredient, raw products. Without

nutrition information for these products,

the Agency has tentatively concluded

that the major cuts of single-ingredient,

raw meat and poultry products would

be misbranded under the Federal Meat

Inspection Act and the Poultry Products

Inspection Act.

FSIS is also proposing to amend its

regulations to require nutrition labels on

all ground or chopped meat and poultry

products, with or without added

seasonings, unless an exemption

applies. Under existing regulations,

multi-ingredient ground or chopped

products, (e.g., ground pork with

seasonings), and heat processed ground

or chopped products (e.g., fully cooked

or partially cooked patties) are required

to be nutritionally labeled, unless they

qualify for an exemption, but singleingredient, raw ground or chopped

products are not required to be so

labeled. Without nutrition information

for single-ingredient, raw ground or

chopped products, the Agency has

tentatively concluded that these

products would be misbranded under

the Federal Meat Inspection Act and the

Poultry Products Inspection Act. The

Agency has also tentatively determined

that single-ingredient, raw ground or

chopped meat and poultry products are

different from other single-ingredient,

raw meat and poultry products in

several important respects. Thus, FSIS

is proposing to make nutrition labeling

requirements for all ground or chopped

meat and poultry products consistent

with those currently required for

products in the mandatory nutrition

labeling program (multi-ingredient and

heat processed products).

FSIS is proposing to require nutrition

labels on packages of single-ingredient,

raw ground or chopped products, rather

than at their point-of-purchase, largely

because these products are similar to

products in the mandatory nutrition

labeling program (which requires

nutrition information to be on the label

of individual packages), in that certain

parameters, such as their fat content,

can be controlled precisely to obtain the

desired product. Although FSIS believes

that nutrition information on labels of

individual packages of singleingredient, raw products is useful, FSIS

is proposing that nutrition information

for the major cuts of single-ingredient,

raw products may also be provided on

point-of-purchase materials because

FSIS believes that consumers have

reasonable expectations as to the

nutrient content of these products, the

nutrient content of a specific major cut

is relatively uniform across the market,

and because these products are not

formulated in the manner of ground or

chopped products. For singleingredient, raw products that are not

major cuts and that are not ground or

chopped, FSIS is not proposing to

require nutrition information on their

labels or at their point-of-purchase

because FSIS has not yet assessed

whether adequate nutrition information

is being provided for these products

and, therefore, has not determined

whether it would be beneficial to

require nutrition labeling for these

products.

Finally, FSIS is proposing to amend

the nutrition labeling regulations to

provide that when a ground or chopped

product does not meet the criteria to be

labeled ‘‘low fat,’’ a lean percentage

claim may be included on the label or

in labeling as long as a statement of the

fat percentage also is displayed on the

label or in labeling.

DATES: Comments must be received on

or before April 18, 2001.

ADDRESSES: Submit one original and

two copies of comments to FSIS Docket

Clerk, Docket #98–005P, Food Safety

and Inspection Service, Room 102,

Cotton Annex, 300 12th Street, SW,

Washington, DC 20250–3700. Reference

material cited in the document and any

comments received will be available for

public inspection in the FSIS Docket

Room from 8:30 a.m. to 4:30 p.m.,

Monday through Friday.

FOR FURTHER INFORMATION CONTACT: Dr.

Robert Post, Director, Labeling and

Additives Policy Division, Office of

Policy, Program Development, and

Evaluation, Food Safety and Inspection

Service, U.S. Department of Agriculture,

Washington, DC 20250–3700; (202) 205–

0279.

SUPPLEMENTARY INFORMATION:

Background

The Current Mandatory and Voluntary

Nutrition Labeling Programs

Mandatory nutrition labeling

program. The Nutrition Labeling and

Education Act (NLEA) of 1990 required

nutrition labeling of most foods

regulated by the Food and Drug

Administration (FDA). FSIS published

regulations establishing comparable

nutrition labeling requirements for meat

and poultry products. As explained in

its proposed and final rules, FSIS

determined that it had statutory

authority to require nutrition labeling

based on the Secretary of Agriculture’s

determination that meat and poultry

products, other than single-ingredient,

raw products, would be misbranded in

the absence of such information, under

section 1(n) of the Federal Meat

Inspection Act (FMIA) (21 U.S.C.

601(n)(1)) and section 4(h)(1) of the

Poultry Products Inspection Act (PPIA)

(21 U.S.C. 453(h)(1)) (56 FR 60305 and

58 FR 637). These statutory provisions

state that a product is misbranded if it

is false or misleading in any particular.

FSIS published an advance notice of

proposed rulemaking on nutrition

labeling of meat and poultry products

on April 2, 1991 (56 FR 13564), a

proposed rule on November 27, 1991

(56 FR 60302), a final rule on January

6, 1993 (58 FR 632), and subsequently

other amendments to the rule.

FSIS’ regulations require nutrition

labels on the packages of all multiingredient and heat processed meat and

poultry products, unless an exemption

applies. The required nutrition labeling

provisions are referred to as ‘‘the

mandatory nutrition labeling program.’’

The regulations include exemptions

from nutrition labeling requirements for

food products produced by small

businesses, products intended for

further processing, products not offered

for sale to consumers, products in small

packages that are individually wrapped

packages of less than 1⁄2 ounce net

weight, custom slaughtered or prepared

products, products intended for export,

ready-to-eat products that are packaged

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4971

or portioned at a retail store or similar

retail-type establishment, and multiingredient products processed at a retail

store or similar retail-type

establishment. The regulations also

provide that nutrition labeling may be

provided by alternate means for

packages that have a total surface area

available to bear labeling of less than 12

square inches; for these products, the

regulations permit manufacturers to

provide an address or telephone number

on the package for consumers to write

or call for nutrition information. Except

for the nutrition labeling exemptions for

custom slaughtered or prepared

products and products intended for

export, the exemptions from nutrition

labeling requirements and the provision

for alternate means of providing

nutrition labeling on packages that have

a limited surface area to bear labeling

apply only when a product’s labeling

includes no nutrition claims or nutrition

information. The regulations also state

that restaurant menus generally do not

constitute nutrition labeling or fall

within the scope of the nutrition

labeling regulations, and that foods

represented or purported to be

specifically for infants and children less

than 4 years of age shall not include

certain nutrient content declarations

(see §§ 317.400 and 381.500).

The regulations specify the

information that must be included on

the labels of products in the mandatory

nutrition labeling program. The required

information includes the levels of total

calories, calories from fat, total fat,

saturated fat, cholesterol, sodium, total

carbohydrate, dietary fiber, sugars,

protein, and certain vitamins and

minerals in the product. In certain

situations, information concerning some

of these nutrients is not required. For

example, the label declaration of

‘‘calories from fat’’ is not required on

products that contain less than 0.5 gram

of fat per serving. The regulations also

provide that information concerning

stearic acid, polyunsaturated fat,

monounsaturated fat, potassium, soluble

fiber, insoluble fiber, sugar alcohol,

other carbohydrates, and calories from

saturated fat may be included

voluntarily. When claims related to

these nutrients are made, or when

certain related nutrients are declared,

information concerning these nutrients

is required.

The regulations require that the

nutrient and food component quantities

on the label of products in the

mandatory nutrition labeling program

be declared in relation to a serving. The

regulations also require that the

declaration of nutrient and food

component content be on the basis of

the product ‘‘as packaged’’; in addition,

the declaration of nutrient and food

component content may also be made

on the basis of ‘‘as consumed,’’ provided

that preparation and cooking

instructions are clearly stated. The

regulations also prescribe format

requirements for nutrient information,

which include specified headings that

must be used in the presentation of

nutrition labeling information.

The regulations include provisions for

Agency monitoring of compliance with

the mandatory nutrition labeling

requirements. FSIS conducts a

continuous product sampling program

to ensure compliance with nutrition

labeling requirements (see

§§ 317.309(h)(1)–(8) and 381.409(h)(1)–

(8)).

Voluntary nutrition labeling program.

In the preamble to the January 6, 1993,

final rule, FSIS stated that it would not

require nutrition labeling for singleingredient, raw meat and poultry

products because the nutrient values of

these products are not modified through

various stages of preparation, such as

cooking and heat processing. Therefore,

the Agency believed that consumers had

reasonable expectations as to the

nutritional qualities of these products

(58 FR 637). In the preamble to the

proposed rule, FSIS also stated that

nutrition information for singleingredient, raw products was available

to consumers through other means such

as the extension service, grocery stores,

and trade associations (56 FR 60306).

For these reasons, although the Agency

adopted a mandatory nutrition labeling

program for multi-ingredient products

and heat processed products, it chose

not to do so for single-ingredient, raw

meat and poultry products, including

single-ingredient, raw ground or

chopped products. Instead, it

established guidelines for voluntary

nutrition labeling of these products (see

§§ 317.345 and 381.445).

Under the voluntary nutrition labeling

program, retailers and manufacturers are

not required to provide nutrition

information for single-ingredient, raw

meat or poultry products. Instead,

retailers and manufacturers voluntarily

may provide nutrition information on

the label of these products, or at their

point-of-purchase by posting a sign or

by making the information readily

available in brochures, notebooks, or

leaflet form in close proximity to the

food. However, if a nutrition claim is

made on these materials, all of the

requirements of the mandatory nutrition

labeling program apply.

If only nutrition information, and not

a nutrition claim, is supplied on the

point-of-purchase materials of singleingredient, raw products, the

requirements of the mandatory program

apply, but the nutrition information

may be supplied on an ‘‘as packaged’’ or

‘‘as consumed basis’’; the listing of

percent of Daily Value for certain

nutrients and the footnote explaining

that the Daily Values are based on a

2,000 calorie diet and that daily values

may differ depending on calorie needs

(see §§ 317.309(d)(9) and 381.409 (d)(9))

may be omitted; and the point-ofpurchase materials are not subject to

any format requirements.

If, however, a retailer or manufacturer

provides nutrition information on the

label of single-ingredient, raw products,

this information must be presented in

the same format as that prescribed for

mandatory nutrition labeling of various

products. However, for these products,

unlike products in the mandatory

nutrition labeling program, the nutrition

information may be declared on the

basis of either ‘‘as consumed’’ or ‘‘as

packaged.’’ If the information is

presented on the basis of ‘‘as

consumed,’’ the regulations provide that

the methods used to cook the product

must be specified and should be those

which do not add nutrients from other

ingredients (see §§ 317.345(d) and

381.445(d)). Also, unlike products in the

mandatory program, the declaration of

the number of servings per container

need not be included on the nutrition

label.

The regulations provide that the

Agency will not conduct compliance

sampling and testing of a product

subject to the voluntary nutrition

labeling program that contains nutrition

labeling if the nutrition labeling is based

upon the most current representative

data base values contained in USDA’s

National Nutrient Data Bank or in its

published form, the Agriculture

Handbook No. 8 series, and if there are

no nutrition claims made on the basis of

the representative database values on

the labeling of these products

(§§ 317.309(h)(9), 317.345(e), 317.345(f),

381.409(h)(9), 381.445(e), and

381.445(f)).

The Agriculture Handbook No. 8

series is now out of print. The current

released form of the USDA’s National

Nutrient Data Bank is the USDA

Nutrient Database for Standard

Reference. USDA’s Nutrient Data Bank

is the Agricultural Research Service’s

internal system that stores information

and has features necessary to produce

the released database. The USDA

Nutrient Database for Standard

Reference is developed and maintained

by the Agricultural Research Service

and can be found on the internet at the

4972 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

following address: http://

www.nal.usda.gov/fnic/foodcomp.

The Agency may conduct sampling

and testing for compliance with

nutrition labeling requirements for

single-ingredient, raw meat and poultry

products if the nutrition information on

their labeling is not based on the latest

values contained in USDA’s National

Nutrient Data Bank or the USDA

Nutrient Database for Standard

Reference, or if there are nutrition

claims made on the basis of the

representative database values, on the

labeling of these products.

Compliance with voluntary nutrition

labeling guidelines. FSIS’ regulations

provide that the Agency monitor

compliance with its voluntary nutrition

labeling program guidelines by

evaluating the participation of retailers

in the voluntary program every two

years, beginning in May 1995, to

determine whether significant

participation of at least 60 percent of all

companies evaluated exists (§§ 317.343

and 381.443). FSIS stated that it would

issue its first report of its survey

findings on the voluntary program by

May 1995, and that it would reevaluate

every two years after 1995 whether

significant participation existed in the

voluntary nutrition labeling program (56

FR 60306).

FSIS regulations provide that a food

retailer is participating at a significant

level (1) if the retailer provides nutrition

labeling information for at least 90

percent of the major cuts of singleingredient, raw meat and poultry

products it sells; and (2) if the nutrition

label on these products is consistent in

content and format with the mandatory

program, or if nutrition information is

displayed at point-of-purchase in an

appropriate manner. The regulations

provide that significant participation by

food retailers exists if at least 60 percent

of all companies that are evaluated are

participating in accordance with the

guidelines. The regulations provide that

the voluntary nutrition labeling program

will remain in effect as long as there is

significant participation in the

voluntary program by retail stores

(§§ 317.343 and 381.443).

FSIS contracted with an independent

market research contracting firm to

conduct the retail surveys in 1995, 1996,

and 1999. For each of these surveys, the

firm surveyed a nationally

representative sample of approximately

2,000 retail stores to obtain the

information necessary to assess

compliance with the guidelines for

voluntary nutrition labeling of singleingredient, raw meat and poultry

products.

The first survey to determine

participation by retail stores in the

voluntary nutrition labeling program

was conducted in June 1995. At that

time, the National Retail Tracking

Index, Inc., found that 66.5 percent of

the stores surveyed were providing

nutrition information on 90 percent of

the major cuts of single-ingredient, raw

meat and poultry products. Therefore,

this survey showed that significant

participation in the voluntary nutrition

labeling program existed. FSIS

published a notice of availability of the

survey results in the January 29, 1996

Federal Register (61 FR 2790). In this

survey, stores were counted as

participating in the voluntary nutrition

labeling program if they used point-ofpurchase materials developed by the

Food Marketing Institute (FMI) prior to

the 1993 final rule on nutrition labeling

of meat and poultry products. These

materials did not comply entirely with

the voluntary nutrition labeling program

provisions in the 1993 final rule. For

example, the older materials did not

include the required percent daily

values for certain nutrients. Therefore,

the results of this survey may

overestimate participation in the

voluntary nutrition labeling program.

The second survey was conducted in

mid-December 1996. FSIS conducted it

jointly with FDA. For this survey, the

two agencies contracted with the firm

that conducted the 1995 FSIS survey,

now named Retail Diagnostics,

Incorporated (RDI). At this time, RDI

found that 57.7 percent of stores

surveyed provided nutrition

information for 90 percent of the major

cuts of single-ingredient, raw meat and

poultry products, in accordance with

program guidelines. The third survey

was conducted in October 1999. At this

time, RDI found that 54.8 percent of

stores surveyed provided nutrition

information for 90 percent of the major

cuts of single-ingredient, raw meat and

poultry products, in accordance with

program guidelines. Therefore, the two

most recent surveys did not show

significant participation in the

voluntary nutrition labeling program,

according to the voluntary nutrition

labeling program regulations. Reports on

the 1996 and 1999 surveys are available

electronically on the FSIS web page at

http://www.fsis.usda.gov.

Nutrient Content Claims

In addition to establishing the

mandatory and voluntary nutrition

labeling programs, the January 6, 1993,

final rule provided definitions at

§§ 317.362 and 381.462 for specific

nutrient content claims, including the

terms ‘‘lean’’ and ‘‘extra lean.’’ The

definitions of ‘‘lean’’ and ‘‘extra lean’’

provide that these terms may be used on

the label or in labeling only if the

product meets certain criteria (see

§§ 317.362(e)(1) and (2) and

381.462(e)(1) and (2)). Meat products

may be labeled ‘‘lean’’ if they contain

less than 10 grams of fat, 4.5 grams or

less of saturated fat, and less than 95

milligrams of cholesterol per 100 grams

of product and per reference amount

customarily consumed for individual

foods. Meat products may be labeled

‘‘extra lean’’ if they contain less than 5

grams of fat, less than 2 grams of

saturated fat, and less than 95

milligrams of cholesterol per 100 grams

of product and per reference amount

customarily consumed for individual

foods. Ground beef and hamburger

seldom meet the criteria that would

allow producers to use the terms ‘‘lean’’

or ‘‘extra lean’’ on the label or in

labeling of these products.

The existing nutrition labeling

regulations also provide that the term

‘‘ll percent lean’’ is a synonym for the

term ‘‘ll percent fat free,’’ and that, in

order for either term to be used on the

label or in labeling of the product, the

product must meet the criteria for ‘‘low

fat’’ (§§ 317.362(b)(6) and 381.462(b)(6)).

To meet the criteria for ‘‘low fat,’’ a

product must have a reference amount

customarily consumed greater than 30

grams or greater than 2 tablespoons and

must contain 3 grams of fat or less per

reference amount customarily

consumed for individual foods, or must

have a reference amount customarily

consumed of 30 grams or less or 2

tablespoons or less and must contain 3

grams or less of fat per reference amount

customarily consumed and per 50 grams

(§§ 317.362(b)(2) and 381.462(b)(2)).

Most ground beef and hamburger do not

qualify as ‘‘low fat.’’ Therefore, existing

regulations preclude the use of the term

‘‘ll percent lean’’ on these products.

On May 24, 1994 (59 FR 26916), FSIS

published a proposed rule entitled

‘‘Nutrition Labeling of Ground Beef and

Hamburger.’’ In the preamble to the

proposal, FSIS explained that the

Agency had determined that, although

the existing regulations precluded

producers of ground beef and

hamburger from using the terms ‘‘lean,’’

‘‘extra lean,’’ and ‘‘ll percent lean,’’

these products should be labeled to

permit consumers to readily identify

and differentiate between the varying

lean to fat ratios in such products. The

Agency also stated that allowing such

labeling would assist consumers in

selecting leaner versions of these

products and would provide an

incentive for manufacturers to market

products lower in fat. Finally, FSIS

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4973

recognized that many producers had

been using lean percentages on the

labeling of ground beef and hamburger

products for a significant period of time

(59 FR 26917).

Accordingly, FSIS proposed to amend

its regulations to permit the use of

percentage labeling for lean and fat on

ground beef and hamburger products.

Under this proposal, FSIS would have

permitted a statement of the lean

percentage on the labeling of ground

beef and hamburger if it were

contiguous to a statement of the fat

percentage. The Agency would have

allowed this labeling even when the

ground beef or hamburger did not

qualify as ‘‘low fat.’’ The Agency

proposed to allow the use of the

statement of lean and fat percentages

only if the product were accompanied

by nutrition information presented on

the label, or in point-of-purchase

materials in close proximity to the

product. FSIS stated that it would

consider expanding the proposed

percentage labeling to ground meat from

other species and to ground poultry if

information submitted during the

comment period demonstrated the need

and consumer acceptability of these

terms for such products or that

differential treatment of ground beef

relative to other ground products would

inappropriately restrict informed

consumer choice (59 FR 26918).

The Agency received a total of 2,732

comments on this proposal. Fifty-five

percent (1,504) of the commenters

supported the proposal, 39 percent

(1,063) opposed it, and 6 percent (165)

addressed issues outside the scope of

the proposed rule. Supporters of the

proposal included trade associations

representing food manufacturers and

retailers, food manufacturers of both

meat and poultry products, a large

number of retailers, and State

departments of agriculture. Supporters

stated that percentage labeling provides

useful information to consumers, that

‘‘lean labeling’’ aids consumers in

selecting lower fat products, and that

percentage labeling has been in use for

more than 20 years. Opponents

included consumer interest groups,

health professionals and organizations,

and consumers. They stated that the use

of percent lean labeling is inherently

misleading to consumers and will cause

consumers to view ground beef as

‘‘lean’’ or ‘‘low fat.’’

Twenty-one of the 1,504 commenters

who supported the provisions wanted

them to also apply to other species or

products. These commenters stated that

allowing percentage labeling for lean

and fat for other ground meat and

poultry products, besides ground beef

and hamburger, would allow consumers

to compare the fat content of beef or

poultry items and to make informed

dietary choices.

On August 5, 1994, FSIS published a

notice of extension of the date that it

would enforce compliance with the

nutrition labeling requirements for

ground beef and hamburger (59 FR

39941). The Agency extended the

compliance enforcement date for these

products indefinitely, pending

publication of a final rule on percentage

labeling for lean and fat on ground beef

and hamburger. The Agency has not

published a final rule concerning

percentage labeling of ground beef and

hamburger. Therefore, producers and

retailers continue to use the term ‘‘lean’’

in percentage labeling on the packages

of ground beef and hamburger.

Other Nutrition Activities

In addition to developing this

proposed nutrition labeling rule, USDA

conducts numerous other activities

related to nutrition. This proposed rule

on nutrition labeling is an integral part

of USDA’s efforts to educate consumers

concerning nutrition and diets. Since

1980 USDA and the Department of

Health and Human Services (HHS) have

jointly published the Dietary Guidelines

for Americans every five years. The

Dietary Guidelines provide advice

concerning food choices that promote

health and prevent disease. USDA and

HHS released the Dietary Guidelines for

Americans, 2000, at the National

Nutrition Summit on May 30, 2000,

which was jointly sponsored by USDA

and HHS. The Dietary Guidelines for

Americans, 2000, advises consumers to

aim for a total fat intake of no more than

30 percent of calories (page 30). In

addition, the Dietary Guidelines for

Americans, 2000, includes a chart

showing the recommended upper limits

for grams of saturated fat and total fat

per day for a range of total calories per

day (page 30). The nutrition information

that FSIS is proposing to require on

labels of ground or chopped products

and on either labels or point-ofpurchase materials for the major cuts of

single-ingredient, raw products would

include the number of calories and the

grams of total fat and saturated fat the

product contains. The information FSIS

is proposing to require would, therefore,

assist consumers in following the advice

in the Dietary Guidelines for Americans,

2000.

Proposed Changes

Nutrition labeling of the major cuts of

single-ingredient, raw products. The

Agency is proposing to require nutrition

labeling of the major cuts of singleingredient, raw meat and poultry

products, except for certain exemptions.

For these products, FSIS is proposing to

make the guidelines currently in place

for the voluntary nutrition labeling

program mandatory. Thus, for all of

these products, other than raw ground

beef and ground pork which are

currently classified as major cuts, FSIS

is proposing that nutrition information

be provided on the label of these

products or at their point-of-purchase.

As discussed below, at this time, FSIS

is not proposing to require nutrition

information for single-ingredient, raw

meat and poultry products that are not

major cuts and that are not ground or

chopped products.

In the preamble to the final rule on

nutrition labeling of meat and poultry

products, under the discussion of its

voluntary nutrition labeling program

which covered all single-ingredient, raw

meat and poultry products, FSIS stated

that it believed that it was important to

provide nutrition information to

consumers (58 FR 640). FSIS also stated

that it believed that by allowing for the

use of point-of-purchase materials for

single-ingredient, raw meat and poultry

products, retailers would be able to

provide consumers with the necessary

nutrition information (58 FR 640). FSIS

continues to believe that nutrition

information for these products is

important and necessary.

In the two most recent surveys, FSIS

found that significant participation in

the voluntary nutrition labeling program

does not exist. FSIS found that less than

60 percent of the stores surveyed

provided nutrition information for 90

percent of the major cuts of singleingredient, raw meat and poultry

products. In its proposed and final rules

on nutrition labeling of meat and

poultry products, FSIS stated that if it

determined, during any evaluation of its

voluntary guidelines, that significant

participation did not exist, it would

initiate proposed rulemaking to

determine whether it would be

beneficial to require nutrition labeling

on single-ingredient, raw meat and

poultry products (56 FR 60306, 58 FR

640).

Because the most recent surveys

showed that significant participation in

the voluntary nutrition labeling program

does not exist, FSIS now believes that

this proposed rule is necessary and that

it would be beneficial to require the

labeling of the major cuts of singleingredient, raw meat and poultry

products to bear nutrition information.

FSIS believes that without nutrition

information, consumers are not able to

assess the nutrient content of the major

cuts and thus cannot make educated

4974 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

choices about these products based on

nutrition information. FSIS believes that

the lack of this information on the

labeling of the major cuts causes the

labeling to be misleading. The FMIA

and PPIA provide that product is

misbranded if its labeling is false or

misleading in any particular (21 U.S.C.

601(n)(1) and 453(h)(1)). Therefore,

without the nutrition information for

the major cuts of single-ingredient, raw

products that would be provided if

significant participation in the

voluntary program existed, the Agency

has tentatively concluded that these

products would be misbranded under

section 1(n) of the FMIA or section 4(h)

of the PPIA. FSIS requests comments on

whether consumers are currently able to

assess the nutrient content of the major

cuts and whether consumers are

currently able to make educated choices

about these products based on nutrition

information.

If the guidelines currently in place for

the voluntary nutrition labeling program

are made mandatory, it would ensure

that consumers are provided with

necessary nutrition information

concerning the major cuts. Therefore,

the Agency is proposing to make

mandatory for the major cuts of singleingredient, raw meat and poultry

products the current provisions for the

voluntary nutrition labeling program for

presentation of nutrition information on

point-of-purchase materials.

FSIS intends to make point-ofpurchase materials available over the

Internet free of charge. The point-ofpurchase materials reflecting the final

nutrition labeling regulations that FMI

developed show nutrition information

in charts with columns covering

multiple products. FSIS requests

comments on whether the Agency

should develop point-of-purchase

materials that present nutrition

information as a compilation of

individual nutrition facts panels for

each product or whether the nutrition

information on the materials should be

presented in charts with horizontal or

vertical columns to cover multiple

products.

Also, consistent with the existing

provisions in the voluntary nutrition

labeling program, the Agency is

proposing to require that if nutrition

information is provided on the label of

individual packages of major cuts of

single-ingredient, raw products, the

current requirements of the mandatory

nutrition labeling program will apply,

but the nutrition information on the

label may be declared either on the basis

of ‘‘as consumed’’ or ‘‘as packaged.’’

FSIS is proposing to allow nutrition

information on the label to be declared

on the basis of ‘‘as consumed’’ without

also requiring that the information on

the label be declared on the basis of ‘‘as

packaged’’ for the major cuts of singleingredient, raw products because, as

discussed below, most of these products

will not need FSIS compliance scrutiny.

Also as noted below, nutrition

information for products under the

existing mandatory nutrition labeling

program must be provided on an ‘‘as

packaged’’ basis for compliance

purposes. Consistent with the existing

voluntary nutrition labeling program,

FSIS is proposing that the declaration of

the number of servings per container

need not be included on the nutrition

label for the major cuts of singleingredient, raw products. FSIS is not

proposing to require that the number of

servings per container be declared for

the major cuts of single-ingredient, raw

products because all of these products

are random weight products, and the

number of servings is not currently

required on random weight products

(see §§ 317.309(b)(10)(iii) and

381.409(b)(10)(iii)).

Although FSIS believes that nutrition

information on labels of individual

packages of single-ingredient, raw

products is useful, FSIS is proposing

that the nutrition information for the

major cuts of single-ingredient, raw

products may also be provided on pointof-purchase materials because, as stated

in the 1993 rule, consumers have

reasonable expectations as to the

nutrient content of these products. Also,

the nutrient content of a given major cut

is relatively uniform across the market,

and these products are not formulated

in the manner of ground or chopped

products. Therefore, FSIS believes it

would be relatively easy to prepare

point-of-purchase materials for the

major cuts and relatively easy for

consumers to find the nutrition

information for a particular major cut on

point-of-purchase materials. Although

FSIS continues to believe that

consumers have reasonable expectations

as to the nutrient content of these

products, FSIS also continues to believe

that it is important to provide nutrition

information to consumers, either

through labels on packages or point-ofpurchase materials. FSIS requests

comment on whether consumers have

reasonable expectations concerning the

nutrient content of the major cuts of

single-ingredient, raw products and on

whether point-of-purchase materials are

appropriate vehicles for conveying

nutrition information for these products.

FSIS specifically requests comment on

whether it should require that nutrition

labeling should be provided for these

products on their label and, if so, on

what basis it would require such

labeling.

FSIS regulations provide that in

evaluating whether there is significant

participation in the voluntary nutrition

labeling program, FSIS will consider

only the major cuts of single-ingredient,

raw meat and poultry products

(§§ 317.343(a) and 381.443(a)).

Consistent with the regulations, FSIS’

voluntary nutrition labeling surveys

only assessed whether nutrition labeling

was provided for the major cuts of

single-ingredient, raw meat and poultry

products.

Examples of single-ingredient, raw

products that are not major cuts (and

that are not ground or chopped) include

pork jowls, pigs feet, pork leg, pork

shoulder picnic, and beef round rump.

For single-ingredient, raw products that

are not ground or chopped and are not

major cuts, FSIS is not proposing that

nutrition information must be provided.

However, FSIS is proposing that if

nutrition information is provided, it

must be provided according to the

existing guidelines for the current

voluntary nutrition labeling program.

Therefore, if nutrition information is

provided for these products, it would be

consistent with nutrition information

for the major cuts of single-ingredient,

raw products.

As the next step in the process of

evaluating the need for nutrition

labeling of meat and poultry products,

FSIS will examine the current state of

nutrition labeling for single-ingredient,

raw products that are not ground or

chopped and that are not major cuts.

FSIS will assess whether adequate

nutrition information is being provided

for these products. Until this assessment

is made, FSIS cannot determine whether

it would be beneficial to require

nutrition labeling for single-ingredient,

raw products that are not ground or

chopped and are not major cuts.

Whether the labeling of these products

should be required to bear nutrition

information would depend on whether

adequate nutrition information is being

provided for them and, if it is not being

provided, what the effect is of its not

being available. If FSIS determines that

adequate nutrition information is not

being provided for these products, FSIS

will consider whether to propose to

require nutrition labeling for these

products.

FSIS is proposing to revise the

nutrition labeling regulations to clarify

which provisions apply to nutrition

labels on single-ingredient, raw

products that are not ground or

chopped, including the major cuts, and

which provisions apply to point-ofVerDate 11<MAY>2000 18:18 Jan 17, 2001 Jkt 194001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4702 E:\FR\FM\18JAP2.SGM pfrm03 PsN: 18JAP2
Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4975

purchase materials for these products.

FSIS is proposing to revise the

regulations so that the provisions for

nutrition labels for these products are in

§§ 317.309 and 381.409, and the

provisions for point-of-purchase

materials for these products are in

§§ 317.345 and 381.445.

Nutrition labeling of ground or

chopped products. The Agency is

proposing to add new provisions at

§§ 317.301 and 381.401, in the Federal

meat and poultry product inspection

regulations. In proposed § 317.301, FSIS

is proposing to require that nutrition

labels be provided for all ground or

chopped (livestock species) and

hamburger, with or without added

seasonings, unless an exemption

applies. In proposed § 381.401, FSIS is

proposing to require that nutrition

labels be provided for all ground or

chopped (kind), with or without added

seasonings, unless an exemption

applies. Products that will have to bear

nutrition labeling if this proposal is

finalized include single-ingredient, raw

hamburger, ground beef, ground beef

patties, ground chicken, ground turkey,

ground chicken patties, ground pork,

and ground lamb. In this discussion,

these products will be referred to as

ground or chopped products. Ground or

chopped products that are multiingredient products or heat processed

products are already required to bear

nutrition labeling, unless they qualify

for an exemption. This proposed

provision would extend the current

mandatory nutrition labeling

requirements to single-ingredient, raw

ground or chopped products. The

proposed provisions do not address

sausages or other comminuted products.

These products are typically multiingredient or heat processed products

that are already required to bear

nutrition information.

As discussed under the ‘‘Background’’

heading above, the existing regulations

include exemptions from nutrition

labeling requirements, such as an

exemption for products produced by

small businesses, custom slaughtered or

prepared products, and certain products

that are packaged, portioned or

processed at retail. As discussed below

under the ‘‘Exemptions’’ heading, most

of these exemptions would apply to

ground or chopped products that qualify

for the exemptions. However, FSIS is

proposing that the current exemptions

from nutrition labeling for ready-to-eat

products packaged or portioned at retail

stores and similar retail-type

establishments and for multi-ingredient

products processed at retail stores and

similar retail-type establishments not

apply to ground or chopped meat and

ground or chopped poultry products,

unless the retail store or similar retailtype establishment meets the

requirements of the small business

exemption. This issue is discussed

further under the ‘‘Exemptions’’ heading

below.

The terms ‘‘ground’’ and ‘‘chopped’’

are synonymous (see § 319.15). FSIS is

proposing to use both terms because

both are used in FSIS regulations and by

industry. In the discussion below, any

statements made regarding the nutrient

values or the production of ‘‘ground’’

products would also apply to

‘‘chopped’’ products.

On June 3, 1997, the Center for

Science in the Public Interest (CSPI)

submitted a petition to FSIS stating that

FSIS should require complete

‘‘Nutrition Facts’’ on ground beef labels

that make nutrient content claims;

should prohibit ‘‘% lean’’ claims on

ground beef; should require ground beef

to meet the same definitions of ‘‘lean’’

and ‘‘extra lean’’ that apply to other

foods; and should require ground beef

labels to replace ‘‘% lean’’ and ‘‘% fat’’

claims with the same ‘‘% less fat’’

claims used by other foods. CSPI also

submitted information illustrating the

variations in ground beef labels that

include information on the lean or fat

percentages of the product.

Consistent with CSPI’s petition, the

Agency has tentatively determined that

nutrition information should be

required on packages of all ground or

chopped meat and poultry products,

unless an exemption applies. FSIS is

proposing to require this information

even if there are no nutrient content

claims on the label.

With regard to the statements in

CSPI’s petition concerning the use of

‘‘% lean,’’ ‘‘lean,’’ ‘‘extra lean,’’ and ‘‘%

less fat’’ claims on ground beef labeling,

FSIS is not revising the regulations as

the petitioner requested. As discussed

below, FSIS is proposing to permit a

statement of lean percentage on the

label or in labeling of all ground or

chopped meat and ground or chopped

poultry products that do not meet the

regulatory definition for ‘‘low fat’’ as

long as a statement of the fat percentage

is also provided, because consumers

have become accustomed to this

information, and because FSIS believes

that this information provides a quick,

simple, accurate means of comparing

these products.

Unlike other single-ingredient, raw

products, producers are able to

formulate precisely the fat content of

ground or chopped products. Therefore,

in this respect, these products are

similar to products in the existing

mandatory program. The fat content of

ground beef products can be formulated

to range from under 6 percent to 30

percent. Below is a table that compares

the nutrient values of three ground beef

products that contain different levels of

fat. All values are based on raw product.

Nutrient values per 100 g Ground beef 17% fat Ground beef 21% fat Ground beef 27% fat

Calories ............................................................................ 234 ..................................... 264 ..................................... 310.

Cholesterol ....................................................................... 69 mg ................................ 75 mg ................................ 85 mg.

Fatty acids, saturated ...................................................... 6.8 g .................................. 8.3 g .................................. 10.8 g.

Source: USDA Nutrient Database for

Standard Reference (1985 data)

FSIS believes that consumers cannot

easily see the fat in ground or chopped

beef. In ground or chopped beef

products, the fat is uniformly

distributed throughout the product and

is not clearly distinguishable on the

surface of the product. Therefore,

consumers cannot estimate the level of

fat in these products and cannot

compare the levels of fat in these

products to those in other products.

Fat is not the only factor that

contributes to the nutrient variability of

ground beef products. Producers

sometimes use beef from advanced meat

recovery (AMR) systems and low

temperature rendering in ground or

chopped beef products, which affect the

nutrient variability of ground beef

products. Product derived from low

temperature rendering of beef tissue that

is not fatty tissue, such as fat reduced

beef or finely textured beef, is

considered beef and can be used in

ground or chopped beef or hamburger

and other ground or chopped meat

products. The regulations currently do

not address the use of fat reduced beef

or finely textured beef. FSIS may

address the use of such products

derived from low temperature rendering

in a future rulemaking.

4976 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

An American Meat Institute (AMI)

survey found that the use of product

derived from AMR systems in ground

beef was becoming more prevalent,

although AMI did not obtain specific

information concerning the volume of

product from AMR systems (The

American Meat Institute Foundation,

Relative Ground Beef Contribution to

the United States Beef Supply (May

1996): 10). This survey also found that

producers use product such as finely

textured beef recovered via technology

(a product derived from low

temperature rendering) in ground beef

products to achieve specific lean

contents (The American Meat Institute

Foundation, Relative Ground Beef

Contribution to the United States Beef

Supply (May 1996): 11). It should be

noted that beef from AMR systems is not

used at retail, unless the retail

establishment is grinding beef product

produced at a Federal establishment.

Ground beef produced at retail from a

single cut of meat, such as ground chuck

or ground round, would not typically

include beef from AMR systems.

However, ground beef produced at retail

from trimmings produced at a Federal

establishment could include beef from

AMR systems.

Typically, meat from AMR systems

does not comprise more than 10 percent

of ground meat products, including

ground beef (R.A. Field, ‘‘Bone Marrow

Measurements for Mechanically

Recovered Products from Machines that

Press Bones,’’ Meat Science 51 (1999):

206). Similarly, meat from low

temperature rendering usually does not

comprise more than 10 percent of

ground products, including ground beef.

However, because beef from AMR

systems or low temperature rendering

generally has higher levels of

cholesterol, iron, and calcium than

other beef, the use of these types of beef

in ground beef products can affect the

nutrient content of these products. The

table below shows the percentage fat

and the levels of iron and calcium per

100 grams of product for regular ground

beef, for beef from AMR systems, and

for product made from 90 percent

regular ground beef and 10 percent beef

from AMR systems. For regular ground

beef and for beef from AMR systems, the

table shows values from different

studies (R.A. Field, ‘‘Bone Marrow

Measurements for Mechanically

Recovered Products from Machines that

Press Bones,’’ Meat Science 51 (1999):

206, 209). FSIS calculated the nutrient

values for product comprised of 90

percent ground beef and 10 percent

AMR product based on the values from

the studies. FSIS calculated values for

product made from 90 percent ground

beef and 10 percent AMR product

because, as stated above, typically meat

from AMR systems does not comprise

more than 10 percent of ground meat

products. All values shown below are

based on raw product.

Nutrient values per 100 grams

Regular ground

beef (Anderson et

al., 1986)

Beef from AMR

(Hasiak and

Marks, 1997)

Beef from AMR

product (Leising,

1997)

Ground beef, 10%

AMR product

(Hasiak and

Marks)

Ground beef, 10%

AMR product

(Leising)

Cholesterol .......................................... 85 mg ................... 115 mg ................. 102 mg ................. 88 mg ................... 86.7 mg

Iron ...................................................... 1.7 mg .................. 2.8 mg .................. 5.6 mg .................. 1.81 mg ................ 2.09 mg

Calcium ............................................... 8 mg ..................... 108 mg ................. 115 mg ................. 18.0 mg ................ 18.7 mg

Even if producers do not use beef

from AMR systems or beef derived from

low temperature rendering, they are able

to precisely control the amount of fat in

the beef that is ground or chopped to

create packages of ground or chopped

beef. A study concerning testing for the

fat content of ground beef found that,

using two testing methods, ground beef

formulated for a certain fat percentage

varied by only 2 percentage points

around the average fat percentage.

Although this study found some

problems concerning blending of

ground beef and testing for the fat

content in ground beef, its results show

that the product can be and is precisely

formulated and within the control of the

producer (Robert Campbell, ‘‘Ground

Beef Testing: Determining Fat Content

and Distribution,’’ Meat and Poultry

(October, 1997): 67–69). Many ground

beef producers have quality control

programs to control the fat content of

their product. These producers conduct

regular sampling and testing for fat in

ground beef products. Thus, producers

are able to formulate these products to

control the amount of fat in them more

precisely than the fat can be controlled

in other cuts. Other single-ingredient,

raw products cannot be formulated in

this manner or to this degree.

Although ground beef comprises the

majority of ground meat products sold

at retail, products such as ground lamb

and ground pork are also available.

Similar to ground beef products, these

products may contain varying amounts

of fat and varying nutrient content,

which consumers cannot visually

detect. In addition, ground pork may

include product from AMR systems or

from low temperature rendering, which

may affect the nutrient content of these

products. Therefore, FSIS is proposing

to require nutrition labeling on these

products and other ground or chopped

meat products. As noted above, meat

from AMR systems or low temperature

rendering typically does not comprise

more than 10 percent of ground meat

products, including ground pork.

Product from AMR systems or low

temperature rendering is generally not

used in ground or chopped lamb.

Because products such as ground pork

and ground lamb may contain varying

amounts of fat and nutrient content,

which consumers cannot visually

detect, and because ground pork may

include product from AMR systems or

low temperature rendering, FSIS is

proposing to require nutrition labeling

on all ground or chopped meat

products.

The fat-to-lean content of ground

poultry products does not vary as

greatly as that of ground beef products;

however, the fat content of ground

poultry can vary depending upon

whether the product is ground light or

dark meat, and whether the product

includes poultry skin. As with the fat on

ground meat products, consumers

cannot readily detect the fat content of

ground poultry products. The table

below shows values for light and dark

turkey meat, with skin and without

skin. All values are based on raw

product. The nutrient content of ground

turkey would vary depending on which

types of meat were used to produce the

product.

Nutrient values per 100 grams Turkey, dark meat and

skin

Turkey, dark meat

only

Turkey, light meat and

skin

Turkey, light Meat

only

Calories .......................................................... 172 ............................. 130 ............................. 165 ............................. 116

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4977

Nutrient values per 100 grams Turkey, dark meat and

skin

Turkey, dark meat

only

Turkey, light meat and

skin

Turkey, light Meat

only

Cholesterol ..................................................... 65 mg ......................... 62 mg ......................... 62 mg ......................... 58 mg

Fatty acids, saturated ..................................... 2.99 g ......................... 1.64 g ......................... 2.19 g ......................... .53 g

Source: USDA Nutrient Database for

Standard Reference (1985 data)

Because the characteristics of ground

or chopped poultry are similar to those

of ground or chopped meat, FSIS is also

proposing to require nutrition labeling

on ground or chopped poultry products.

The Agency is also proposing

comparable requirements for ground or

chopped meat and poultry products

because it is committed to equitable

treatment of meat and poultry products.

FSIS has consistently taken the position

that similar products should be

regulated in a similar manner to

facilitate consumers’ ability to make

comparisons among these products.

For the reasons discussed above, the

Agency has tentatively concluded that

ground or chopped meat and poultry

products that do not bear nutrition

information would be misbranded

under section 1(n)(1) of the FMIA and

section 4(h)(1) of the PPIA. As noted

above, in the January 6, 1993 final rule,

the Agency did not require nutrition

labeling on packages of singleingredient, raw meat and poultry

products because FSIS believed that

consumers had reasonable expectations

as to the nutritional qualities of such

products since they are not modified

through various stages of preparation,

such as cooking and heat processing (58

FR 637). FSIS now believes that the

variation in the fat and nutrient content

of different ground or chopped

products, the formulated nature of these

products, and the fact that the fat

content of these products cannot be

readily visually assessed makes it

difficult for consumers to have a

reasonable expectation as to the

nutritional quality of these products.

Further consideration of the issues

raised in the petition from CSPI brought

many of these issues to FSIS’ attention.

If this proposal is adopted, the existing

mandatory nutrition labeling provisions

in §§ 317.309 and 381.409 would apply

to these products, unless they are

subject to an exemption.

Although current labeling on ground

beef products often includes

information concerning the percentage

of fat in the product, as noted in the

CSPI petition, without complete

nutrition labeling, consumers cannot

easily determine the amount of fat per

serving of ground beef. Also, without

complete nutrition labeling, consumers

cannot assess how much saturated fat,

cholesterol, protein, or calories the

product contains. Furthermore,

consumers cannot easily compare fat

percentages on the labeling of ground

beef products with the information

concerning grams of fat per serving or

with the information concerning the

percent daily values that is found on the

labeling of products that are currently

covered by the mandatory nutrition

labeling program.

The Agency tentatively concludes that

information concerning the nutritional

qualities of ground or chopped meat and

poultry products is particularly

important because these products,

especially ground beef, are widely

consumed. Pertinent nutrition

information is integral to consumer

purchase decisions because use of this

information may result in prevention of

health problems and reduction of health

risks for some consumers. Additional

information about the nutrient values of

ground or chopped meat and poultry

products would enable consumers to

make informed decisions about

including these products in their diets

and, therefore, will help consumers to

construct healthy diets.

FSIS is proposing to require that

nutrition information for ground or

chopped meat and poultry products

appear on the label of these products

(unless an exemption applies), as is

required for other products in the

current mandatory nutrition labeling

program, rather than on point-ofpurchase materials. Ground or chopped

products are similar to products in the

mandatory nutrition labeling program,

which requires nutrition information to

be on the label of products, in that

certain parameters, such as their fat

content, can be controlled precisely to

obtain the desired product. In addition,

because there are numerous

formulations of ground or chopped

products, it would be difficult for

producers or retailers to develop pointof-purchase materials that would

address all the different formulations

that exist for these products.

Furthermore, it would be difficult for

consumers to find the correct

information for a specific ground or

chopped product on point-of-purchase

materials that include information

concerning numerous formulations of

these products. For these reasons, FSIS

tentatively concludes that nutrition

information should be required on the

label of these products, consistent with

the requirements in the existing

mandatory nutrition labeling program.

FSIS requests comments concerning

whether nutrition information should be

required on individual packages of

ground or chopped product or whether

the information should be allowed at

their point-of-purchase.

In addition, consistent with

requirements for products that fall

under the existing mandatory nutrition

labeling program, FSIS is proposing that

the declaration of nutrient and food

component content for ground or

chopped products be required on an ‘‘as

packaged’’ basis. The preamble to the

final rule explained why products in the

mandatory nutrition labeling program

would be required to be labeled on an

‘‘as packaged’’ basis: ‘‘There are

varieties of cooking methods that affect

the nutrient values of food products

differently. Therefore, there is no

method to assure the accuracy or

measure compliance of the nutrient

values of food labeled on an ‘as

consumed’ basis.’’ (58 FR 648). These

reasons for requiring nutrition

information on an ‘‘as packaged’’ basis

for products in the current mandatory

nutrition labeling program also are the

basis for requiring that ground or

chopped products be required to be

labeled on an ‘‘as packaged’’ basis.

Whether or not the fat is drained off

during the cooking of ground or

chopped products would affect the

nutrient values of ground or chopped

products. As discussed below, ground

or chopped products will be subject to

FSIS compliance. Therefore, FSIS

tentatively concludes that it is necessary

to require that nutrition information be

presented on an ‘‘as packaged’’ basis for

ground or chopped products in order to

assure the accuracy of nutrient values

and to measure compliance of the

nutrient values of these products. FSIS

requests comment on whether it would

be difficult for producers to comply

with this requirement.

However, consistent with the

provisions of the existing mandatory

program, FSIS is proposing that

nutrition information for ground or

chopped products may be presented on

an ‘‘as consumed’’ basis, in addition to

the required ‘‘as packaged’’ basis,

provided that preparation and cooking

instructions are clearly stated. FSIS is

proposing to allow nutrition

4978 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

information on as ‘‘as consumed’’ basis,

in addition to the required ‘‘as packaged

basis,’’ because FSIS believes this is

useful information for consumers.

FSIS requests comments on whether

all Federal establishments and retail

stores are able to control the fat and

nutrient content of ground or chopped

meat and poultry products. FSIS also

requests comment on the practices of

retail stores that grind or chop meat and

poultry. FSIS is interested in whether

retail stores that grind or chop product

mix trimmings from one Federal

establishment with trimmings from

other Federal establishments. In

addition, FSIS is interested in data on

the extent to which product from AMR

systems or product from low

temperature rendering is used in ground

or chopped products.

FSIS requests comments concerning

whether consumers have reasonable

expectations as to the nutritional quality

of ground or chopped product, whether

consumers know which ground or

chopped products are lowest in fat,

whether consumers understand that the

fat content of ground or chopped

product can affect other nutrients,

whether consumers can see the fat in

ground or chopped meat and poultry

products, and whether consumers can

make comparisons among ground or

chopped products and other products.

Exemptions

Under §§ 317.400(a)(1) and

381.500(a)(1), food products produced

by small businesses are exempted from

mandatory nutrition labeling if the

product labels bear no nutrition claims

or nutrition information. The

regulations provide that a small

business is any single-plant facility or

multi-plant company or firm that

employs fewer than 500 people and, as

of July 1996, that produces 100,000

pounds or less annually of the product

that qualifies the establishment for the

exemption from mandatory nutrition

labeling. The Agency stated in the

preamble to the January 6, 1993, final

rule, that it would exempt small

businesses from mandatory nutrition

labeling requirements because these

requirements would create undue

economic hardship for small businesses

and would create disincentives for these

small businesses to develop more

nutritious food products (58 FR 638).

For the reasons stated in the January

6, 1993 final rule, FSIS continues to

believe that small businesses should be

exempt from the mandatory nutrition

labeling requirements proposed for

ground or chopped meat and ground or

chopped poultry products. Therefore,

under this proposal, ground or chopped

products produced by establishments

that qualify for the small business

exemption would be exempt from the

proposed nutrition labeling

requirements.

As discussed below, a significant

amount of ground beef is processed at

retail. Therefore, FSIS is proposing to

revise the regulations to make clear that

a single retail store or multi-retail store

operation could qualify for the small

business exemption. To qualify for this

exemption, the retail facility must either

be a single retail store that employs 500

or fewer people or a multi-retail store

operation that employs 500 or fewer

people. In addition, to qualify for the

exemption, the retail establishment

could produce no more than 100,000

pounds per year of the product that

qualifies the establishment for an

exemption. Consistent with existing

regulations, the qualification of a multiretail store operation for an exemption

from nutrition labeling would be based

upon its total annual production of the

product for all of its stores that qualifies

the operation for the exemption and the

total number of employees for all of its

stores (see 58 FR 638 for guidance on

existing regulations).

As under current regulations, for the

purposes of the small business

exemption, a food product is a

formulation, not including distinct

flavors which do not significantly alter

the nutritional profile of the product,

sold in any size package in commerce.

Therefore, ground or chopped products

formulated to have different levels of fat

would be considered different food

products for purposes of the small

business exemption. For example, if a

multi-retail store operation employed

500 or fewer people in total and

produced, in total among all of its

stores, 70,000 pounds of ground beef

that is 10 percent fat and 60,000 pounds

of ground beef that is 20 percent fat

annually, the multi-retail store

operation would not be required to

include nutrition information on the

label of these specific products if the

labels for these products bore no

nutrition claims or nutrition

information. However, for example, if a

multi-retail store operation employed in

total 500 or fewer employees and

produced 130,000 pounds of 10 percent

fat ground beef annually in total among

all of its stores, it would not be exempt

from nutrition labeling requirements on

the basis of the ‘‘small business

exemption.’’ FSIS is interested in

comments on whether the exemption

proposed is appropriate for purposes of

ground or chopped products produced

at retail establishments.

FSIS does not believe that the reasons

that necessitated the establishment of

the small business exemption, as

explained in the January 6, 1993 final

rule, are applicable to the major cuts of

single-ingredient, raw meat and poultry

products produced by small businesses.

For these products, FSIS is proposing

that nutrition information may be

provided on labels or alternatively at

their point-of-purchase. FSIS intends to

make point-of-purchase materials

available over the Internet free of

charge; therefore, the proposed nutrition

labeling requirement for major cuts of

single-ingredient, raw products should

not impose an economic hardship for

small businesses, including those that

are retail stores. FSIS is proposing to

revise §§ 317.400(a)(1) and 381.500(a)(1)

to provide that the small business

exemption would not apply to the major

cuts of single-ingredient, raw products.

Under existing §§ 317.400(a)(7) and

381.500(a)(7), retail stores and similar

retail-type establishments are exempted

from nutrition labeling requirements for

multi-ingredient products processed at

retail establishments and ready-to-eat

products packaged or portioned at retail

establishments (which would include

ready-to-eat and multi-ingredient

ground or chopped products) if the

products bear no nutrition claims or

nutrition information. As stated in the

preamble to the January 6, 1993 final

rule, FSIS exempted retail

establishments from mandatory

nutrition labeling requirements for these

products because the Agency

determined that it would be impractical

to enforce nutrition labeling

requirements on these products

prepared or served at retail, and because

the Agency concluded, based on a

review of National Food Consumption

Survey (NFCS) data, that the average

person’s diet consisted of an

insignificant proportion of ready-to-eat

retail packaged products or retail

processed products (58 FR 639).

Most ground poultry is processed and

packaged outside retail establishments.

However, most ground beef is ground

and packaged at retail. An AMI report

states that retail survey respondents

reported that an average 18.5 percent of

their ground beef sales was from

product arriving in a finely ground state,

ready to sell or ready for repackaging at

retail. Retail stores or distribution

centers ground or re-ground 81.3

percent of ground beef sold (The

American Meat Institute Foundation,

Relative Ground Beef Contribution to

the United States Beef Supply (May

1996): 7).

As noted above, in the preamble to

the January 6, 1993, final rule, the

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4979

Agency concluded that the average

person’s diet consists of an insignificant

portion of ready-to-eat retail packaged

products or retail processed products.

Consumers who purchase ground beef

likely consume a significant amount of

ground beef processed at retail.

Therefore, there may be a significant

amount of ground beef products that are

ready-to-eat retail packaged products or

retail processed products.

As noted above, in the January 6, 1993

final rule, FSIS also exempted retail

establishments from mandatory

nutrition labeling partly because the

Agency determined that it would be

impractical to enforce nutrition labeling

requirements on products prepared or

served at retail. The Agency no longer

believes enforcement of nutrition

labeling requirements at retail stores to

be impractical because FSIS is already

conducting testing for Escherichia coli

O157:H7 at retail.

Because a significant amount of

ground beef is processed at retail, the

Agency believes that there may be a

significant amount of multi-ingredient

ground beef retail processed products or

ready-to-eat retail packaged products.

FSIS also believes that enforcement of

nutrition labeling at retail would not be

impractical. Further, FSIS has

tentatively concluded that ground or

chopped products that do not include

nutrition information would be

misbranded for the reasons stated above.

Therefore, the Agency is proposing that

the current exemptions from nutrition

labeling for ready-to-eat products

packaged or portioned at retail stores

and similar retail-type establishments

and multi-ingredient products

processed at retail stores and similar

retail-type establishments not apply to

ground or chopped meat and ground or

chopped poultry products, unless the

retail store or similar retail-type

establishment meets the requirements of

the small business exemption. FSIS

requests comments and data on the

volume of ground or chopped products

that are multi-ingredient retail

processed products or ready-to-eat retail

packaged products.

FSIS is also proposing to revise the

current retail exemptions discussed

above to make clear that if a retail

establishment qualifies for the small

business exemption discussed above,

ground or chopped ready-to-eat

products packaged or portioned at retail

and ground or chopped multi-ingredient

products processed at retail would be

exempt from nutrition labeling

requirements. Although most ground

poultry is processed and packaged

outside retail establishments, FSIS

believes it is important to propose

consistent requirements for all ground

or chopped products. Therefore, for all

ground or chopped products, including

ground poultry, these exemptions

would not apply, unless the retail store

or similar retail-type establishment

meets the requirements of the small

business exemption.

The exemptions for ready-to-eat

products packaged and portioned at

retail stores and for multi-ingredient

products processed at retail stores

would not apply to the major cuts of

single-ingredient, raw products because

they are not ready-to-eat or multiingredient products.

As discussed above, in addition to the

small business and retail exemptions,

existing §§ 317.400 and 381.500 provide

other exemptions from nutrition

labeling requirements. These

exemptions include products intended

for further processing, products not for

sale to consumers, products in small

packages that are individually wrapped

packages of less than 1⁄2 ounce net

weight, custom slaughtered or prepared

products, and products intended for

export. To qualify for the first three

exemptions, the product’s label cannot

bear nutrition information or a nutrition

claim. In the preamble to the January 6,

1993, final rule, FSIS explained that it

was providing an exemption for

products intended for further processing

and products not for sale to consumers

because consumers do not see the

nutrition information on products used

for further processing or products that

are not for sale to consumers. The

Agency also explained that it would

exempt individually wrapped packages

of less than 1⁄2 ounce net weight,

provided no nutrition claim or nutrition

information was made on the label,

because these products are an

insignificant part of the diet. With

regard to the custom exemption, the

Agency explained that an exemption

should apply because these custom

services are performed solely for

individuals. Finally, the Agency

explained that products intended for

export should be exempt because these

products are labeled according to the

requirements of the country where the

product is to be exported (58 FR 639).

The Agency has tentatively determined

that the bases for these exemptions, as

explained in the January 6, 1993 final

rule, are valid as applied to nutrition

labeling for ground or chopped products

and for major cuts of single-ingredient,

raw products. Therefore, under this

proposal, any ground or chopped

product or major cut of singleingredient, raw product that qualifies

for any of these exemptions will

continue to be exempt even if the

proposed nutrition labeling

requirements are adopted.

Under current regulations, products

in packages that have a total surface area

available to bear labeling of less than 12

square inches are exempt from nutrition

labeling, provided the product’s labeling

includes no nutrition claims or nutrition

information and provided that an

address or telephone number that a

consumer can use to obtain the required

information is included on the label.

FSIS allowed for nutrition information

to be provided by alternative means for

products of this size in order to

incorporate sufficient flexibility in the

regulations (58 FR 47625). For ground or

chopped products, FSIS believes it is

necessary to provide this flexibility for

products in packages that have a total

surface area available to bear labeling of

less than 12 square inches, provided

that the labels for these products bear no

nutrition claims or nutrition

information. However, because nutrition

information for the major cuts of singleingredient, raw meat and poultry

products may be provided on point-ofpurchase materials, FSIS is proposing

that the provisions for providing

nutrition labeling by alternate means for

products in packages that have a total

surface area available to bear labeling of

less than 12 square inches would not

apply to the major cuts of singleingredient, raw meat and poultry

products.

As stated in the existing regulations,

restaurant menus generally do not

constitute labeling or fall within the

scope of these regulations. Likewise,

restaurant menus that include ground or

chopped products generally do not

constitute nutrition labeling or fall

within the scope of these regulations.

Similarly, although a restaurant menu

would most likely not include a major

cut of single-ingredient, raw product, if

it did, the menu would not fall within

the scope of these regulations.

Finally, the current regulations

provide that foods represented or

purported to be specifically for infants

and children less than 4 years of age

must not include certain nutrient

content declarations, because infants

and children less than 4 years of age

have different nutrition needs than

adults and children older than 4 years

of age. Under this proposal, any ground

or chopped product or major cut of

single-ingredient raw product

represented or purported to be

specifically for infants and children less

than 4 years of age would be required

to meet these same requirements.

FSIS requests comments on whether

its proposed revisions to the nutrition

labeling exemptions are appropriate and

4980 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

necessary for ground or chopped

products and for the major cuts of

single-ingredient, raw products.

Enforcement and Compliance

Ground or chopped products. FSIS

conducts a continuous sampling

program of products that fall under the

mandatory nutrition labeling program. If

the proposal to mandate nutrition

labeling of ground or chopped meat and

ground or chopped poultry products is

adopted, the procedures set forth for

product sampling and nutrient analysis

in §§ 317.309(h)(1)–(8) and

381.409(h)(1)–(8) will be applicable to

ground or chopped meat and to ground

or chopped poultry products,

respectively. Under this proposal, the

Agency will sample and conduct

nutrient analysis of ground or chopped

products to verify compliance with

nutrition labeling requirements, even if

nutrition labeling on these products is

based on the most current representative

data base values contained in USDA’s

National Nutrient Data Bank or the

USDA Nutrient Database for Standard

Reference and there are no claims on the

labeling. Therefore, if these proposed

provisions for ground or chopped meat

and poultry products are adopted, the

Agency will treat these products as it

treats all other products for which

regulations already require nutrition

labels on their package.

FSIS is proposing that ground or

chopped products be subject to

compliance even if nutrition labeling on

these products is based on the most

current representative data base values

contained in USDA’s National Nutrient

Data Bank or the USDA Nutrient

Database for Standard Reference

because the fat content of different

ground or chopped products can vary

significantly, depending upon the level

of fat in the product being ground and

depending on whether product from

advanced meat recovery systems is

used. Additionally, at this time, there

are a limited number of ground or

chopped products in the database (e.g.,

ground beef, 17% fat, 21% fat, and 27%

fat).

Further, FSIS program employees

cannot visually assess whether nutrition

information on the label of ground or

chopped products accurately reflects the

labeled products’ contents because, in

most cases, it is not possible to visually

assess the level of fat in a ground

product. For example, FSIS program

employees cannot visually determine

whether product that is labeled 17

percent fat ground beef is actually 17

percent fat ground beef as opposed to 27

percent fat (or another percentage of fat)

ground beef. Therefore, even if the

retailer or other producer uses

information from the USDA database to

label these products, FSIS will need to

conduct compliance sampling and

nutrient analysis to ensure that the

information on the label accurately

reflects the nutrient content of the

labeled products.

The Agency is also proposing to

revise §§ 317.345(e) and 381.445(e) so

that they refer to USDA’s National

Nutrient Data Bank and its released

form, the USDA Nutrient Database for

Standard Reference, and to remove

current references to the Agriculture

Handbook No. 8 series, because this

handbook series is now out of print.

For the nutrition labeling of some

ground or chopped meat or ground or

chopped poultry, nutrient data may be

immediately available through the

USDA Nutrient Database for Standard

Reference (e.g., ground beef with 17

percent fat, ground beef with 21 percent

fat, and ground beef with 27 percent

fat). Private databases may be available

to assess the nutrient content of other

products. In addition, producers are

able to provide the nutrition

information for many products

produced to meet purchase

specifications. Because producers know

the different cuts of meat that go into

ground or chopped product, they have

the information necessary to determine

the nutrient content of the products.

FSIS believes that if they need to

conduct nutrient analysis, the analysis

should not impose an excessive burden.

FSIS will develop a list of published

sources of information concerning the

nutrient content of ground or chopped

products, so that industry could obtain

available literature from local libraries.

This information would facilitate the

development of nutrition labels for

ground or chopped products. FSIS

requests comments and supporting data

on the costs that Federal and retail

establishments would incur for

conducting nutrient analysis of ground

or chopped products.

For ground or chopped products that

are nutritionally labeled at official

establishments, FSIS program

employees will collect samples for

nutrient analysis at official

establishments, consistent with the

Agency’s existing sampling program of

products that fall under the mandatory

nutrition labeling program. For ground

or chopped products that are produced

and nutritionally labeled at retail, it is

likely that FSIS program employees will

collect samples for nutrient analysis

while they are conducting other

program activities at retail stores. When

collecting samples for nutrient analysis,

FSIS will not typically collect samples

of the same product from both Federal

establishments and retail

establishments, unless circumstances

warrant sampling the same product at

both locations. In general, if a product

from a Federal establishment is further

processed at retail, FSIS would only

collect samples of that product at retail,

where it would be packaged for sale to

consumers. FSIS can distinguish

between product packaged at retail

versus product packaged at a Federal

establishment.

Major cuts of single-ingredient, raw

products. If nutrition labeling of the

major cuts of single-ingredient, raw

products (other than ground beef or

ground pork) is based on USDA’s

National Nutrient Data Bank or the

USDA Nutrient Database for Standard

Reference, and there are no nutrition

claims on the labeling, FSIS will not

sample and conduct a nutrient analysis

of these products. The Agency’s

sampling and testing policy for these

products will be consistent with its

policy under the current voluntary

nutrition labeling program for these

products.

For the major cuts of singleingredient, raw products, FSIS

personnel can visually identify the

particular cut. If the nutrition

information for these products is based

on USDA’s National Nutrient Data Bank

or the USDA Nutrient Database for

Standard Reference, and there are no

nutrition claims on the labeling, it is not

necessary for FSIS to verify the accuracy

of this data because it is USDA data. If

the nutrition information is based on

USDA data, and there are no nutrition

claims, FSIS program employees would

only have to verify that the data

presented accurately pertains to a

particular major cut of single-ingredient,

raw product. Therefore, FSIS does not

need to conduct nutrient analysis for

these products.

If the nutrition information on the

label or at the point-of-purchase of

major cuts of single-ingredient, raw

products is based on databases other

than the above referenced USDA ones or

other data, or if there are nutrition

claims on the labeling, these products

would be subject to FSIS compliance

analysis. Most nutrition information for

the major cuts of single-ingredient, raw

products is based on USDA data and,

typically, no nutrition claims are made

on the labeling of these products.

Therefore, these products are and would

generally continue to be exempt from

the FSIS nutrition labeling compliance

verification program.

It is likely that FSIS program

employees will verify that nutrition

information is provided for the major

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4981

cuts of single-ingredient, raw products,

either on their labels or at their pointof-purchase, at retail stores while they

are conducting other program activities

at retail. If nutrition information on the

point-of-purchase materials or labels for

these products is not based on USDA’s

National Nutrient Data Bank or the

USDA Nutrient Database for Standard

Reference, or if there are nutrition

claims on the labeling, FSIS program

employees may collect samples of the

major cuts from retail stores for nutrient

analysis. Similarly, if major cuts are

nutritionally labeled at official

establishments and the nutrition

information on the label is not based on

USDA’s National Nutrient Data Bank or

the USDA Nutrient Database for

Standard Reference, or if there are

nutrition claims on the labeling, FSIS

program employees may collect samples

of these products from the official

establishment for nutrient analysis.

Percentage Labeling

FSIS is withdrawing its proposed rule

of May 24, 1994 (59 FR 26916),

discussed above, which sought to

amend the regulations by permitting

percentage labeling for lean and fat on

ground beef and hamburger, when the

product did not meet the regulatory

criteria established for ‘‘low fat,’’ if the

product had nutrition information on its

labeling or in point-of-purchase

materials that were in close proximity to

the product. FSIS is withdrawing this

proposal and proposing revised

percentage labeling requirements in this

rule. In this proposal, FSIS is expanding

the categories of ground or chopped

products that can have lean percentage

labeling.

FSIS is proposing to permit a

statement of lean percentage on the

label or in labeling of ground or

chopped meat and poultry products that

do not meet the regulatory criteria for

‘‘low fat.’’ The Agency is proposing to

do so because many consumers have

become accustomed to this labeling on

ground beef products, and because FSIS

believes this labeling provides a quick,

simple, accurate means of comparing all

ground or chopped meat and poultry

products. The proposed regulatory

language requires that a statement of fat

percentage be contiguous to, in lettering

of the same color, size and type as, and

on the same color background as, the

statement of lean percentage. The

Agency is proposing these requirements

concerning size, type, and color to

ensure that the statement of the fat

percentage is as clear and readily

observable as the statement of the lean

percentage.

FSIS requests comments on whether

percent fat/percent lean information

provides a quick, simple, accurate

means of comparing all ground or

chopped meat and poultry products.

Also, FSIS is specifically requesting

comments concerning whether its

proposed percent fat/percent lean

labeling provisions for ground or

chopped meat and ground or chopped

poultry products that do not meet the

regulatory criteria for ‘‘low fat’’ would

be misleading in any way. FDA’s

regulations do not provide for the

nutrient content claim, ‘‘X percent

lean.’’ Similarly, FDA does not allow a

statement of ‘‘percent fat/percent lean’’

on the products it regulates. FSIS

requests comment on whether these

discrepancies between FDA’s and FSIS’

regulations will cause confusion among

consumers. Finally, FSIS is not

requiring the statement of fat percentage

to precede the statement of lean

percentage but will allow the statements

to appear in either order. FSIS requests

comment on whether consumers are

more likely to read and understand the

statement of fat percentage when it

precedes the statement of lean

percentage than when it follows the

statement of lean percentage.

Executive Order 12866—Preliminary

Analysis

This action has been reviewed for

compliance with Executive Order

12866. As this action is determined

‘‘significant’’ for purposes of Executive

Order 12866, the Office of Management

and Budget (OMB) has reviewed it.

Need for the Rule

During the 1996 nutrition labeling

survey, RDI found 57.7 percent of stores

surveyed provided nutrition

information for 90 percent of the major

cuts of single-ingredient, raw meat and

poultry products, in accordance with

program guidelines. In the 1999

nutrition labeling survey, RDI found

that 54.8 percent of stores surveyed

provided nutrition information for 90

percent of the major cuts of singleingredient, raw meat and poultry

products, in accordance with program

guidelines. Therefore, the most recent

surveys did not show significant

participation in the voluntary nutrition

labeling program as defined in the

regulations. Without significant

participation, the Agency has tentatively

concluded that a lack of consistent and

complete nutrition information for the

major cuts of single-ingredient, raw

products exists. FSIS has also

tentatively concluded that producers’

ability to control the formulation of

single-ingredient, raw ground or

chopped products results in variations

across these products that may be

difficult for consumers to detect.

Without nutrition information, FSIS

believes that these products would be

misbranded under section 1(n) of the

FMIA or section 4(h) of the PPIA and

that further action is necessary in order

to provide consumers with adequate

nutrition information that is consistent

with the provisions of the 1993 final

nutrition labeling rule.

Baseline

In the analysis below, FSIS assumes

that the level of voluntary labeling,

absent any Federal action, would

remain at the current level. The 1999

RDI nutrition labeling survey found that

54.8 percent of the stores surveyed

provided nutrition information for 90

percent of the major cuts of singleingredient, raw meat and poultry

products, in accordance with program

guidelines. As there has been little

change in the level of compliance over

the last several years (see discussion of

previous surveys above), FSIS believes

that it is appropriate to assume that this

level of participation in the voluntary

nutrition labeling program would not

change unless the regulations are

revised.

In the analysis below, FSIS also

assumes that 80 percent of the retail

establishments and processors have

made investments in the equipment

necessary to print, stamp, or affix

nutrition labels on products. This

assumption is based on the results of the

1999 RDI safe handling labeling

compliance survey. This survey

revealed that 96.7 percent of large

chains, 90.5 percent of large

independent retailers, and 84.1 percent

of medium/small independents had

already complied with the Mandatory

Safe Handling Statements on Labeling of

Raw Meat and Poultry Products final

rule. FSIS used the 80 percent

assumption in order to be conservative

and not overestimate the percentage of

processors and retailers that have

already invested in the necessary

equipment. Because the equipment

needed to print, stamp, or affix nutrition

labels is similar to the equipment used

to print, stamp, or affix labels to meet

the ‘‘safe handling’’ rule’s requirements,

FSIS assumes that 80 percent of

establishments would not have to install

new machines for stamping, printing, or

affixing nutrition labels for ground or

chopped products. FSIS is assuming

that the same percentage of processors

have invested in this equipment as

retailers. Again, this is a conservative

assumption. FSIS requests comments

concerning whether the 80 percent

4982 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

estimate is appropriate for both

processors and retailers.

To determine how many entities

would be affected by this rulemaking,

the Agency used a combination of FSIS

developed databases and industry

sources. Table 1 indicates that in 1999,

63 establishments produced ground

poultry and 2,426 establishments

produced ground meat. FSIS developed

this data on establishments from its

Enhanced Facilities Database (EFD).

This source does not provide separate

data for ground pork, lamb and beef.

The number of establishments

producing ground pork or lamb is,

however, likely to be very small based

on information from the AMI survey

discussed below in the preliminary cost

analysis. One plant that produced either

meat or poultry and did not have

employment size specification is

excluded from Table 1.

TABLE 1.—SIZE DISTRIBUTION OF

MEAT AND POULTRY HACCP

PLANTS PRODUCING GROUND PRODUCTS

Poultry Meat Total

Very

Small 10 1,470 1,480

Small ..... 23 843 866

Large ..... 28 68 96

Missing

Values 2 45 47

Total .. 63 2,426 2,489

Note: Very small=9 or less employees;

small=10 to 499 employees; large=500 or

more employees.

FSIS believes that a significant

amount of ground beef is processed at

retail. Table 2 shows the number of

retail stores in 1999. Most of these stores

grind beef. However, FSIS does not have

specific data concerning the levels of

ground beef ground at retail or on the

size of retail stores that process ground

beef. FSIS researched Census data for

this information, but specific

information related to retail

establishments processing ground or

chopped product was unavailable. Table

2 reports data from FMI. FSIS combined

the first two categories of supermarkets

with sales in excess of $2 million per

year to compare their share with ‘‘other

stores’’ with sales of less than $2 million

per year. In 1999, there were 127,000

retail grocery stores.

TABLE 2.—NUMBER OF RETAIL

GROCERY STORES, 1999

1999

number

1999 % of

total

Total .................. 127,000 100

Supermarket

Chains &

Independent .. 31,500 25

Other Stores ..... 37,200 29

Convenience

Stores ............ 57,500 45

Wholesale Clubs 800 0.6

Note: ‘‘Supermarkets’’ are defined to have

sales of $2 million or more per year. ‘‘Other

Stores’’ are defined to have sales of under $2

million.

Source: FMI Information Service,

Progressive Grocer, 67th Annual Report of

the Grocery Industry. April 2000, p.20.

With respect to consumers, FSIS

assumes that without further action,

they would have access to the current

level of labeling information and

continue with their current dietary

habits. The 1999 RDI survey estimated

that nutrition labeling, in accordance

with the program guidelines, for the

major cuts of single-ingredient, raw

meat and poultry products was available

to 62.8 percent of shoppers. This

estimate was based on the sales volume

of the stores surveyed. Consistent with

the Agency’s assumption about

compliance among retail stores, FSIS

assumes that this level of available

nutrition information, in accordance

with program guidelines, would not

change without further regulatory

action.

FSIS used data from USDA’s

Continuing Survey of Food Intake by

Individuals (CSFII), and the associated

Diet and Health Knowledge Survey

(DHKS) to establish a baseline for fat,

saturated fat, and cholesterol intake.

The CSFII collects data on food intakes

by individuals. Most recently, USDA

conducted three separate one-year

surveys for 1994–96. These surveys

recorded two nonconsecutive days of

food consumption, and collected

information on what and how much

individuals ate, and where the food was

obtained. This information was used to

develop estimates of nutrient intake for

each individual respondent. The DHKS

gathered data on consumers’ knowledge

of issues related to diet and heath, and

contained several questions relating to

the use of nutrition information labels

and nutrition information for food

products. Linking information from the

two surveys allowed FSIS to correlate

use of nutrition information from the

DHKS with nutrient intake data from

the CSFII. The Agency focused here on

two key questions pertaining to

nutrition information use on all food

products and on meat and poultry in

particular:

Q: When you buy foods, do you use

the nutrition panel that tells the amount

of calories, protein, fat, and such [e.g.,

sodium, total carbohydrate] in the

serving of a food: Often (always),

sometimes, rarely, or never? (Question

16–c, DKHS)

Q: When you buy raw meat, poultry,

or fish, do you look for nutrition

information: Often (always), sometimes,

rarely, or never? (Question 17–I, DHKS).

Using data from the CSFII and the

DHKS, FSIS estimated rates of nutrition

information usage, based on these two

questions. The results are presented in

Table 3. Note that rates of label usage

are uniformly higher for women than for

men, and that rates of nutrition label

usage are higher for food products as a

whole than for raw meat, poultry and

fish products.

TABLE 3.—CONSUMER USAGE OF NUTRITION INFORMATION

Often Sometimes Rarely/never Do not buy

Men Women Men Women Men Women Men Women

Use Nutrition Facts Panel ................................ 26.7 41.7 25.6 32.6 47.7 25.6 n/a N/A

Look for Nutrition Information on Raw Meat,

Poultry, or Fish ............................................. 16.9 22.1 18.2 18.0 62.7 57.9 2.2 2.0

Note: Percent of respondents, based on 3 year weighted averages, 1994–1996.

To establish a baseline of Intake of

Fat, Saturated Fat, and Cholesterol, FSIS

used the same data sources to estimate

dietary intake of fat, saturated fat, and

cholesterol, along with the percentage of

calories from fat and saturated fat. The

CSFII contains information on the

intake of these food components, based

on the food consumption reported by

survey respondents.

Tables 4 and 5 present the estimated

intake of fat, saturated fat, and

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4983

cholesterol from the CSFII, broken down by types of nutrition information usage

reported in the DHKS.

TABLE 4.—DIETARY INTAKE OF FAT, SATURATED FAT, BY USAGE OF NUTRITION FACTS PANEL

Often Sometimes Rarely/

never Average

Men:

Total Fat ................................................................................................................... 83.13 92.52 98.14 92.51

Saturated Fat ............................................................................................................ 26.93 31.43 33.67 31.12

Cholesterol ................................................................................................................ 293.39 327.77 353.97 339.07

Women:

Total Fat ................................................................................................................... 55.95 62.78 63.98 60.16

Saturated Fat ............................................................................................................ 18. 04 20.77 21.39 19.71

Cholesterol ................................................................................................................ 196.60 216.84 230.03 210.53

Note: Fat intake in grams, cholesterol in milligrams.

TABLE 5.—DIETARY INTAKE OF FAT, SATURATED FAT, BY USAGE OF NUTRITION INFORMATION ON RAW MEAT, POULTRY,

OR FISH

Often Sometimes Rarely/

never Do not buy Average

Men:

Total Fat ........................................................................................... 81.64 92.49 96.09 74.48 92.51

Saturated Fat .................................................................................... 27.20 31.09 32.44 24.02 31.12

Cholesterol ........................................................................................ 311.81 321.49 355.14 236.83 339.07

Women:

Total Fat ........................................................................................... 53.90 61.70 62.18 57.23 60.16

Saturated Fat .................................................................................... 17.39 20.60 20.41 17.27 19.71

Cholesterol ........................................................................................ 194.32 219.27 216.55 135.89 210.53

Note: Fat intake in grams, cholesterol in milligrams.

The estimated intake of fat and

saturated fat can also be expressed as

the percentage of calories from fat. This

conversion is done with the following

formula:

Percentage Calories from Fat = 900*fat/

energy,

Where energy is total caloric intake

(kilocalories), as measured by the

CSFII. Tables 6 and 7 show the

percentage of calories from fat (and

total cholesterol) broken down by

label and nutrition information

usage:

TABLE 6.—PERCENTAGE OF CALORIES FROM FAT AND TOTAL CHOLESTEROL, BY USAGE OF NUTRITION FACTS PANEL

Often Sometimes Rarely/

never Average

Men:

Total Fat ................................................................................................................... 31.54 33.63 35.27 33.44

Saturated Fat ............................................................................................................ 10.19 11.38 12.00 11.19

Cholesterol ................................................................................................................ 293.39 327.77 353.97 339.07

Women:

Total Fat ................................................................................................................... 31.14 33.40 34.49 32.49

Saturated Fat ............................................................................................................ 10.00 11.38 11.59 10.64

Cholesterol ................................................................................................................ 196.60 216.84 230.03 210.53

Note: Fat and Saturated Fat values are percentage of calories from fat source; cholesterol in milligrams.

TABLE 7.—PERCENTAGE OF CALORIES FROM FAT AND TOTAL CHOLESTEROL, BY USAGE OF NUTRITION INFORMATION ON

RAW MEAT, POULTRY, OR FISH

Often Sometimes Rarely/

never Do not buy Average

Men:

Total Fat ........................................................................................... 31.67 34.03 33.88 29.69 33.44

Saturated Fat .................................................................................... 10.53 11.36 11.37 9.52 11.19

Cholesterol ........................................................................................ 311.81 321.49 355.14 236.83 339.07

Women:

Total Fat ........................................................................................... 31.62 32.94 32.87 26.79 32.49

Saturated Fat .................................................................................... 10.15 10.82 10.82 9.19 10.64

Cholesterol ........................................................................................ 194.32 219.27 216.55 135.89 210.53

Note: Fat and Saturated Fat values are percentage of calories from fat source; cholesterol in milligrams.

4984 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

Regulatory Options

FSIS considered several regulatory

options: (1) Continuing with the existing

voluntary program; (2) making the

voluntary program mandatory; (3)

requiring nutrition information on

labels of all ground or chopped products

and making the voluntary program

mandatory for the major cuts of singleingredient, raw meat and poultry

products; (4) requiring nutrition

information on labels of the major cuts

of single-ingredient, raw meat and

poultry products and on all ground or

chopped products; and (5) requiring

nutrition information on labels of all

single-ingredient, raw meat and poultry

products and all ground or chopped

products.

Option 1: Continuing with the

voluntary program. FSIS could continue

with the existing voluntary program and

attempt to increase participation by

providing additional assistance to the

nonparticipants. The 1999 nutrition

labeling survey found a significant

difference in participation rates

according to outlet type. Chain stores

showed a 65.5 percent participation

rate, large independents showed a 46.5

percent participation rate, and medium

and small independents showed a

participation rate of 26.3 percent. Thus,

FSIS could provide nutrition

information or point-of-purchase

materials to independent retail stores to

encourage their participation in the

voluntary nutrition labeling program.

Retail establishments would continue

to provide, on a voluntary basis,

nutrition labeling for all singleingredient, raw meat and poultry

products, including major cuts

identified in §§ 317.344 and 381.444

(including ground beef and ground

pork) and cuts that are not identified as

major cuts (including ground or

chopped products not covered in

§§ 317.344 and 381.444). This

information could be provided at the

point-of-purchase or on the label of the

product.

Option 2: Make the voluntary program

mandatory. FSIS could make the

voluntary program mandatory by

requiring nutrition information, either

on labels or at the point-of-purchase, for

all single-ingredient, raw meat and

poultry products, including the major

cuts of single-ingredient, raw products

identified in §§ 317.344 and 381.444

(including ground beef and ground

pork) and the nonmajor cuts of singleingredient, raw meat and poultry

products (including ground or chopped

products not covered in §§ 317.344 and

381.444). Under this option, FSIS would

assume that most retailers would

display point-of-purchase information

for these products rather than nutrition

labels, because this is an inexpensive

means of providing nutrition

information for multiple products. This

approach does not allow for any

distinction between ground or chopped

meat and poultry products and other

cuts of meat. In addition, this approach

does not distinguish between the major

and nonmajor cuts.

Option 3: Require nutrition

information on labels of all ground or

chopped meat and poultry products and

make the voluntary program mandatory

for the major cuts of single-ingredient,

raw meat and poultry products (other

than ground beef and ground pork).

FSIS could require nutrition

information on the labels of all ground

or chopped products and could require

nutrition information, either on their

labels or at their point-of-purchase, for

the major cuts of single-ingredient, raw

meat and poultry products identified in

§§ 317.344 and 381.444 (other than

ground beef and ground pork). Retail

establishments and producers could

continue to voluntarily provide

nutrition information for nonmajor cuts

of single-ingredient, raw meat and

poultry products that are not ground or

chopped. This approach allows for a

distinction between ground or chopped

meat and poultry and other cuts of meat

and poultry. It also allows for a

distinction between major and nonmajor

cuts. Consistent with the regulations,

the voluntary nutrition labeling surveys

only assessed whether nutrition labeling

was provided for the major cuts of

single-ingredient, raw meat and poultry

products. Until some assessment is

made of whether adequate information

is being provided for the nonmajor cuts

of single-ingredient, raw products that

are not ground or chopped, FSIS cannot

determine whether it would be

beneficial to require nutrition

information for these products.

In their June 3, 1997, petition

discussed above, CSPI stated that USDA

should require complete ‘‘Nutrition

Facts’’ on ground beef labels that make

nutrient content claims. This option

would require complete ‘‘Nutrition

Facts’’ on all ground beef labels. Thus,

CSPI’s petition supports this aspect of

this option. However, the CSPI petition

also stated that point-of-purchase

information is generally a poor

substitute for labels and that the ‘‘NutriFacts’’ posters and brochures used by

many stores have severe flaws. Thus,

the CSPI petition does not support

providing nutrition labeling at the

point-of-purchase.

Option 4: Require nutrition

information on labels of the major cuts

of single-ingredient, raw meat and

poultry products and on all ground or

chopped products. FSIS could require

nutrition information only on labels of

the major cuts of single-ingredient, raw

meat and poultry products identified in

§§ 317.344 and 381.444 (including

ground beef and ground pork) and on all

other ground or chopped products not

covered in §§ 317.344 and 381.444. As

in Option 3, establishments could

voluntarily provide nutrition

information, either at the point-ofpurchase or on the label, for the

nonmajor cuts of single-ingredient, raw

meat and poultry products that are not

ground or chopped. This approach

allows for a distinction between major

cuts and nonmajor cuts that are not

ground or chopped. Until some

assessment is made of whether adequate

information is being provided for the

nonmajor cuts of single-ingredient, raw

products that are not ground or

chopped, FSIS cannot determine

whether it would be beneficial to

require nutrition information for these

products.

Option 5: Require nutrition labels on

all single-ingredient, raw meat and

poultry products and on all ground or

chopped products. FSIS could require

nutrition information on labels of all

single-ingredient, raw meat and poultry

products, including both the major cuts

of single-ingredient, raw products

identified in §§ 317.344 and 381.444

(including ground beef and ground

pork) and nonmajor cuts of singleingredient, raw products, and on all

ground or chopped products not

covered in §§ 317.344 and 381.444. An

April 4, 2000, press release on CSPI’s

web page, quotes the organization’s

executive director as stating, ‘‘Frozen

and processed meats already have

nutrition labels. That same information

should be on fresh meat’’ (http://

www.cspinet.org/new/

nutr_labeling.html). Thus, CSPI

supports this option.

FSIS requests comments on whether

any of the options not chosen would be

a viable alternative to the option chosen

and on the possible costs and benefits

of the options presented.

Quantification of Costs and Net Benefits

of Regulatory Options

FSIS’ preliminary analysis does not

allow for a comparison of net benefits

among the regulatory options. The

Agency is unable, at this time, to

distinguish between the benefits that

accrue from moving from a voluntary

program to a mandatory program and

the benefits that would accrue from

requiring nutrition labels on products

versus nutrition information on pointVerDate 11<MAY>2000 18:18 Jan 17, 2001 Jkt 194001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4702 E:\FR\FM\18JAP2.SGM pfrm03 PsN: 18JAP2
Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4985

of-purchase materials. Furthermore,

although a comparison of costs of the

regulatory options might be possible,

FSIS has not quantified all costs. As a

result, FSIS believes that it would be

inappropriate to provide a comparison

of net benefits of the regulatory options

considered at this time.

Below, FSIS provides a preliminary

analysis of the costs and benefits of the

proposed rule. FSIS requests comments

on this preliminary analysis and any

data that would be useful in estimating

the costs and benefits of the proposed

rule.

The Proposed Rule

FSIS is proposing Option 3. FSIS is

proposing to require nutrition labels on

all ground or chopped meat and poultry

products, with or without added

seasonings, unless an exemption

applies, and to make the voluntary

nutrition labeling program mandatory

for major cuts of single-ingredient, raw

meat and poultry products identified in

§§ 317.344 and 381.444, unless an

exemption applies.

Without a mandatory labeling

program for the major cuts of singleingredient, raw products (that are not

ground or chopped), FSIS believes that

complete and consistent information on

the nutritional attributes of these

products will not be provided to every

consumer. FSIS also believes that the

producers’ ability to control the fat and

nutrient content of ground or chopped

product and the consumers’ inability to

detect the nutritional variations in these

products through observation makes it

necessary to further require that labeling

requirements for all ground or chopped

meat and poultry products be consistent

with those currently required for multiingredient and heat processed products.

The Agency has tentatively concluded

that ground or chopped products and

the major cuts of single-ingredient, raw

products would be misbranded without

nutrition information under the FMIA

and the PPIA (21 U.S.C. 601(n)(1) and

21 U.S.C. 453(h)(1)).

Many exemptions from the proposed

nutrition labeling requirements would

apply to ground or chopped products

and to the major cuts of singleingredient, raw products. The existing

regulations provide that food products

produced by small businesses are

exempted from mandatory nutrition

labeling if the product labels bear no

nutrition claims or nutrition

information. Under this rule, small

businesses that qualify for the

exemption would be exempt from the

mandatory nutrition labeling

requirements proposed for ground or

chopped products. However, the small

business exemption would not apply to

the major cuts of single-ingredient, raw

meat and poultry products. Also, the

existing regulations provide that retail

stores and similar retail-type

establishments are exempted from

nutrition labeling requirements for

multi-ingredient products processed at

retail and ready-to-eat products

packaged or portioned at retail if the

products bear no nutrition claims or

nutrition information. In this rule, FSIS

is proposing that these exemptions not

apply to ground meat and poultry

products, unless the retail store or

similar retail-type establishment meets

the requirements for the small business

exemption. For a full discussion of the

exemptions, see the ‘‘Exemptions’’

heading above. FSIS is requesting

comments on whether these exemptions

are appropriate and necessary for retail

and Federal establishments. The

preliminary cost and benefits analyses

below do not take the exemptions into

account because FSIS does not have

sufficient data concerning the

establishments that would qualify for

the small business exemption or the

volume of product that would be

exempted from nutrition labeling

requirements. Therefore, FSIS requests

comments on how the exemptions

would affect the costs and benefits of

the proposed rule.

In addition to the proposed

requirements discussed above, FSIS is

proposing to amend the nutrition

labeling regulations to provide that

when a ground or chopped product does

not meet the regulatory criteria to be

labeled ‘‘low fat,’’ a lean percentage

claim may be included on the label or

in labeling as long as a statement of the

fat percentage also is displayed on the

label or in labeling. Under existing

regulations, in order for the phrase

‘‘ll percent lean’’ to be used on the

label or in labeling of a product, the

product must meet the regulatory

criteria for ‘‘low fat.’’ Most ground beef

and hamburger products do not qualify

as ‘‘low fat.’’ Therefore, existing

regulations preclude the use of the term

‘‘ll percent lean’’ on these products.

FSIS extended the compliance

enforcement date for nutrition labeling

requirements for ground beef and

hamburger indefinitely, pending

publication of a final rule on percentage

labeling for lean and fat on ground beef

and hamburger (59 FR 39941); therefore,

producers and retailers continue to use

the term ‘‘lean’’ in percentage labeling

on the packages of ground beef and

hamburger. FSIS is proposing to allow

this information on the label or in

labeling for ground or chopped products

because many consumers have become

accustomed to this labeling on ground

beef products, and because FSIS

believes this labeling provides a quick,

simple, accurate means of comparing all

ground or chopped meat and poultry

products. Under the preliminary cost

analysis below, FSIS provided a

preliminary cost estimate for developing

new labels that include statements of

the lean percentage and the fat

percentage. FSIS intends to develop a

more detailed analysis of this labeling

provision in the final rule.

Preliminary Estimations of the Cost of

the Proposed Rule

Making the voluntary program

mandatory for the major cuts of singleingredient, raw meat and poultry

products. FSIS believes that the cost of

providing nutrition labeling for the

major cuts of single-ingredient, raw

meat and poultry products should not

be significant. Retail establishments can

choose between providing nutrition

information through point-of-purchase

materials or providing nutrition

information on labels. Processors may

also provide the information on labels

or on point-of-purchase materials;

however, FSIS would enforce these

requirements at retail. Point-of-purchase

materials are available for a nominal fee

($12.00 for members, $24.00 for

nonmembers) through the Food

Marketing Institute’s web site (http://

www.fmi.org). These materials meet the

point-of-purchase requirements in this

proposed rule. Also, FSIS intends to

make point-of-purchase materials

available, free of charge, on the FSIS

web site. Another factor that would

mitigate the cost impact of this

requirement is that, based on the

nutrition labeling survey conducted in

1999, many stores are currently

providing nutrition information for the

major cuts of single-ingredient, raw

products. As discussed above, the 1999

survey found that 54.8 percent of stores

surveyed provided nutrition

information for 90 percent of the major

cuts of single-ingredient, raw meat and

poultry products, in accordance with

program guidelines.

FSIS estimates the one-time costs to

retail establishments for obtaining

point-of-purchase materials that include

nutrition information for the major cuts

of single-ingredient, raw meat and

poultry products would be about $0.7

million. FSIS is estimating that all

retailers would display point-ofpurchase information for the major cuts

of single-ingredient, raw meat and

poultry products, because this is an

inexpensive means of providing

nutrition information for multiple

4986 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

products and because this rule will not

require that manufacturers include

nutrition labels on the major cuts of

single-ingredient, raw meat and poultry

products. FSIS estimates that obtaining

point-of-purchase materials and making

them available to consumers would take

an average of 30 minutes. As shown in

Table 2 above, there were 69,500 retail

stores in 1999 (excluding convenience

stores that do not normally sell meat

products), and FSIS estimates salary and

expenses costs for providing nutrition

information to be $20 per hour (69,500

* 0.5 * $20 = 0.7 million). This estimate

does not take into account the voluntary

nutrition labeling survey results which

show that many stores currently provide

nutrition information for the major cuts

of single-ingredient, raw products.

Information concerning this cost is

addressed in the Information Collection

Request submitted to OMB and in the

section on paperwork requirements

below.

As discussed above, FSIS is proposing

that many of the existing exemptions

from nutrition labeling requirements

would apply to the major cuts of singleingredient, raw meat and poultry

products. However, FSIS is proposing

that the small business exemption from

nutrition labeling requirements would

not apply to the major cuts of singleingredient, raw products. As explained

above, FSIS does not believe that the

reasons that necessitated the

establishment of the small business

exemption, as explained in the January

6, 1993, final rule, are applicable to the

major cuts of single-ingredient products.

Also, because nutrition information for

the major cuts of single-ingredient, raw

products may be provided on point-ofpurchase materials, FSIS is proposing

that the provisions for providing

nutrition labeling by alternative means

for products in packages that have a

total surface area available to bear

labeling of less than 12 square inches

would not apply to the major cuts of

single-ingredient, raw products.

Nutrition labeling of ground or

chopped products. The costs of required

labels would be incurred by ground

meat or poultry processors supplying

labeled products to retail stores for sale

to consumers and by retail

establishments who grind or chop meat

and poultry products in their stores for

sale to consumers. Costs would include

the fixed costs of equipment, the

operating costs of printing labels,

including materials and labor, and the

cost of nutrient analysis.

FSIS estimated the costs of nutrition

labels based on the cost analysis

conducted for the ‘‘Mandatory Safe

Handling Statements on Labeling of

Raw Meat and Poultry Products’’

proposed rule published November 4,

1993 (58 FR 58922); the costs estimates

were not revised in the final rule in

response to comments. The rationale for

using the ‘‘safe handling’’ cost analysis

is that the costs of the labels in these

two proposals would be comparable for

cost estimation purposes. FSIS is not

using the regulatory impact analysis

developed for the nutrition labeling

regulations for cost estimation purposes

because much less nutrient analysis will

be required at this time than was

required when the 1993 nutrition

labeling regulations were published

(January 6, 1993). There are currently

much more data available for nutrition

labeling than were available when the

1993 nutrition labeling regulations were

published.

Safe Handling Cost Estimates

Fixed costs. The ‘‘safe handling’’ rule

estimated the fixed costs of installing or

retrofitting labeling equipment for

stamping, printing, or affixing labels.

The ‘‘safe handling’’ rule had estimated

the fixed costs of labeling fresh meat

and poultry products for processors to

range from $50 to $100 million. These

costs were based on an estimate that

there were somewhere between 50,000

and 100,000 labels approved for use by

processors that were affected and an

estimated average label modification

cost of $1,000 (58 FR 58925).

The fixed costs of compliance with

the ‘‘safe handling’’ labeling rule for

retail establishments were estimated to

range from $144 to $216 million. These

estimates assumed that larger retailers

would modify their equipment to

increase their label size to combine

weight and price information with safe

handling instructions if their existing

equipment was incompatible. These

estimates were based on the costs to the

then (i.e., 1992) existing 23,813

supermarkets (with annual sales

exceeding $2.5 million/year). Based on

conversations with equipment suppliers

and two to three retailers, FSIS

estimated that upgrading the automated

scales/wrapping systems to

accommodate a larger label would cost

$6,000 to $9,000 per store. Assuming

that all 24,000 (approx.) supermarkets

upgraded their equipment, the cost

would range from $144 ($6000 x 24,000)

to $216 ($9000 x 24,000) million. FSIS

estimated these costs for large retail

chains, i.e., supermarkets, because they

constituted three-fourths of total grocery

stores sales. For example, in 1992, of the

total grocery stores sales of $360 billion

(excluding sales taxes), supermarkets

accounted for $274 billion, or 76

percent. FSIS also estimated these costs

for large retail chains because FSIS

assumed that small retailers would

produce a second label using existing

equipment to meet the ‘‘safe handling’’

rule requirements and, therefore, would

incur mostly operating costs rather than

fixed costs to meet the ‘‘safe handling’’

rule requirements.

Operating costs. The ‘‘safe handling’’

analysis assumed that all meat and

poultry products already included some

form of commercially prepared labels,

and that the incremental cost of adding

safe handling instructions to the label

would increase the total per label cost

by $0.0025 to $0.005. This estimate was

also supported by the comment of one

large retail chain. In their response to

the an earlier interim rule that included

a preliminary economic analysis (58 FR

43478), this commenter stated that

including the safe handling label, as

part of their price labels, would double

the cost of their labels from $0.0025 to

$0.005 per label. For firms that

indicated that they would need separate

labels for the safe handling statement

(e.g., the small retail stores), the most

frequent comment in response to the

preliminary analysis was that the labels

for safe handling would cost $0.01 each.

In the ‘‘safe handling’’ rule, FSIS

assumed that large retail chains would

incur the lower costs ($0.0025 to $0.005)

per label by including the safe handling

statement as part of their price label. For

the smaller firms requiring separate

labels for the safe handling statement,

FSIS assumed that their costs would be

$0.01 per package. The higher costs for

small retailers can be explained by the

absence of economies of scale available

to these retailers.

As discussed above, in 1992, large

retail chains had sales that accounted

for 76 percent of total grocery store

sales. In the ‘‘safe handling’’ rule, FSIS

rounded this number and assumed that

80 percent of packages of meat and

poultry products labeled and sold

through retail would be sold through

large retail chains. The ‘‘safe handling’’

rule estimated that there were 10 billion

packages of meat and poultry product

prepared and sold through retail.

Therefore, the rule estimated that 8

billion packages would be prepared and

sold by large retail chains and the

remaining 2 billion packages would be

prepared and sold by small retail firms.

The safe handling rule estimated that

the 10 billion retail packages would

have recurring costs associated with the

‘‘safe handling’’ rule of $50 million per

year. This estimate assumed that the 8

billion packages sold through large

retail chains would have recurring costs

of $0.00375 (midpoint of $.0025 and

$0.005) and the 2 billion packages sold

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4987

through small stores would have

recurring costs of $0.01 per package.

In the ‘‘safe handling’’ rule, the

additional labor costs for applying the 2

billion separate safe handling labels by

use of label guns for small firms were

estimated. Based on the number of staff

years at 160 and an average salary of

$20,000 per year, the ‘‘safe handling’’

rule estimated the labor costs at about

$3.2 million per year.

The ‘‘safe handling’’ rule did not

estimate operating costs of labeling for

processors because they were expected

to incur larger, upfront, one-time fixed

costs, associated with making

permanent modifications to labels.

Adjustments to the Costs in the Safe

Handling Rule

Estimating the volume of ground or

chopped products. As explained above,

the ‘‘safe handling’’ rule estimated the

cost of labeling all fresh meat products.

The number and volume of products

that would require nutrition labels in

this proposed rule are, however, much

smaller relative to the number and

volume of products in the ‘‘safe

handling’’ rule, because the proposed

rule would require nutrition labels on

only ground or chopped meat and

poultry products. FSIS adjusted the

costs of the ‘‘safe handling’’ rule to

reflect the costs related to the volume of

ground or chopped product produced.

In 1996, total U.S. annual production

of ground beef was 7 billion pounds

(American Meat Institute Foundation,

Relative Ground Beef Contribution to

the United States Beef Supply (May

1996): 5). The American Meat Institute

(AMI) report cited has not been

updated. However, according to AMI

staff, total U.S. annual production of

ground beef was 7.2 billion in 1998, an

increase of less than 3 percent. For

estimation purposes, FSIS believes the

1996 data are still valid. Based on

discussion with AMI staff members,

approximately 50 percent (or 3.5 billion)

of this output is sold through retail

stores (the rest goes through restaurants

and institutions). As regards other

ground or chopped products such as

poultry, pork, and turkey, AMI

estimates that for every 100 pounds of

ground beef, 12.3 pounds of these

competing meats are produced (The

American Meat Institute Foundation,

Relative Ground Beef Contribution to

the United States Beef Supply (May

1996): 8). The estimate of 12.3 pounds

is based on a survey sent by AMI to the

top 50 retail chains and wholesalers. No

attempt was made to expand the survey

responses to a national level or develop

estimates for the entire retail sector. In

the absence of any information that

would validate the survey responses for

the entire retail sector, however, FSIS

employed these estimates as

approximate trends. However, FSIS

invites comments and requests

nationally representative data for the

retailers for analysis of the final rule.

To arrive at the total volume of

ground or chopped meat and poultry

products sold in retail stores, FSIS first

assumed that 50 percent of total

production, or 3.5 billion pounds,

represented ground or chopped beef

sold in retail stores. Second, based on

the AMI survey referred to above, FSIS

assumed that ground or chopped

poultry and other meats represented

12.3 percent of ground beef sales.

Therefore, the total annual volume of

ground or chopped meat and poultry

sold through retail establishments

amounted to 3.9 (3.5 + .4) billion

pounds [3.5 billion + (3.5 billion * 0.123

= .431 billion].

Fixed costs. As explained above, the

‘‘safe handling’’ rule had estimated the

fixed costs of safe handling labeling for

processors to range from $50 to $100

million. Also explained above, the fixed

costs of compliance with the ‘‘safe

handling’’ labeling rule for retail

establishments were estimated to range

from $144 to $216 million. The

estimation of these fixed costs assumed

that larger retail stores would modify

equipment to increase their label size to

combine weight and price information

with safe handling instructions if their

existing equipment was incompatible.

In this rule, retail stores also might

modify equipment to increase their label

size to combine weight and price

information with nutrition information.

To calculate the fixed costs of

nutrition labeling of ground or chopped

products, FSIS adjusted the fixed costs

in the ‘‘safe handling’’ rule to account

for existing equipment. FSIS believes

that many establishments have already

incurred fixed costs required for the

‘‘safe handling’’ rule. For example the

1999 safe handling survey revealed that

96.7 percent of large chains, 90.5

percent of large independents, and 84.1

percent of medium/small independents

had already complied with the ‘‘safe

handling’’ rule requirements. Therefore,

as explained in the ‘‘Baseline’’ section

above, FSIS made the conservative

assumption that 80 percent of the

estimated fixed costs were already

incurred by retailers and processors and

only 20 percent of the estimated fixed

costs would be required for compliance

with the proposed rule. Hence the

estimated fixed costs of the proposed

rule would range from $10 million to

$20 million for processors and from

$28.8 million to $43.2 million for

retailers.

Although these costs were estimated

based on 1992 prices, there has been

virtually no change in their prices in the

year 2000. For example, the index

number for producer prices for blast

furnaces and steel mills was 105.8 (1982

= 100) in 1992, and it was almost the

same at 105.3 (1982 = 100) in July 2000.

FSIS used this index number because

these producers also manufacture

equipment used for stamping and

printing labels. Therefore, these costs

are current and do not need any

updating. These costs are shown in

columns 1 and 2, Table 8.

Operating costs. As explained above,

the safe handling analysis had assumed

that all meat and poultry products

already included some form of

commercially prepared labels, and that

the incremental cost of adding safe

handling instructions to the labels

would increase the total per label cost

by $0.0025 to $0.005. The ‘‘safe

handling’’ rule also estimated that the

cost to firms that would need separate

labels for the safe handling statement

would be $0.01 per label. As in the ‘‘safe

handling’’ rule, in this rule, FSIS is

assuming that large retail chains would

incur the lower costs ($0.0025 to $0.005)

per label, because they would include

nutrition information as part of their

price labels. Similarly, consistent with

the ‘‘safe handling’’ rule, for this rule,

FSIS is assuming that smaller stores

would apply a separate label with

nutrition information.

As explained above, in the ‘‘safe

handling’’ rule, FSIS assumed that large

retail chains would account for 80

percent of all retail packages labeled at

retail and that the smaller firms would

account for 20 percent of all retail

packages. FSIS believes that the

estimate that 80 percent of retail-labeled

packages are sold through large retail

chains is likely to be valid in the year

2000 (without the need to round up)

because of a number of mergers,

acquisitions, and consolidations in this

sector in the recent years. For example,

Royal Ahold bought Giant Foods,

Albertson’s bought American Stores,

SUPERVALUE bought Richfood, and

Food Lion bought Hannaford (Sean

Mehegan, ‘‘Merger Mania—

Consolidation Changes the Face of the

North American Supermarket Sector,’’

Meat & Poultry (September 1999): 22–

25). FSIS requests comments and data

concerning whether the estimate that 80

of retail-labeled packages are sold

through large retail chains is accurate.

For the proposed rule, FSIS is

assuming that a package of ground or

chopped meat or poultry would average

4988 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

two pounds. FSIS believes that most

packages of ground or chopped product

weigh at least a fraction over one pound;

however, this product is also sold in

bulk size packages that are significantly

over one pound. Therefore, FSIS

believes that two pounds is a reasonable

estimate of the average weight of a

package of ground or chopped product.

If FSIS were to assume that the average

size package were 1 pound, this

assumption would double the estimated

operating costs below. FSIS requests

comments on whether two pounds is an

accurate average weight estimate for

packages of ground or chopped product.

Since the estimated annual volume of

ground or chopped product sold

through retail is about 4 billion pounds,

there will be 2 billion packages (at two

pounds each) requiring the labels.

Because FSIS assumes that 80 percent of

these packages would be accounted for

by large firms, their corresponding

shares of the packages would be 1.6

billion (80 percent of 2 billion) and

small firms would account for the rest,

i.e., 0.4 billion packages (20 percent of

2 billion). Assuming a mid-point cost of

$0.00375 for the range of safe handling

label costs for large retail stores ($0.0025

to $0.005), the compliance cost for these

stores would be $6 million (1.6 billion

packages * $0.00375). The compliance

cost for separate nutrition labels

required by small firms would be about

$4 million (0.4 billion packages times

$0.01 per package). These costs were

estimated in 1992, and there was an

increase of 20 percent in related costs in

July 2000. This increase is based on the

producer price index numbers for

plastics, foil, and coated paper bags, the

materials on which labels would be

printed (1992 = 142.9, July 2000 =

171.7). Therefore, these operating costs

would increase by $2 million to $12

million in current prices.

As explained above, the ‘‘safe

handling’’ rule estimated the labor costs

of small firms applying separate safe

handling labels by use of label guns at

about $ 3.2 million per year, based on

2 billion labels, and 160 staff years at an

average salary of $20,000 per year.

According to data from the Bureau of

Labor Statistics, the average hourly

earnings in June of 1999 were $7.88 per

hour. Assuming at least 2,000 work

hours per year, the estimated annual

earnings would be $15,760. FSIS

adjusted the costs in the ‘‘safe handling’’

rule based on this earnings estimate.

Therefore, FSIS revised the estimated

‘‘safe handling’’ labor costs to small

firms to $3.0 million per year (160 staff

years times $16,000 per staff totals

$2,560,000 per year, which FSIS

rounded to $3 million). Since these

costs were for 2 billion packages for the

safe handling rule, the prorated costs for

400 million packages for the proposed

rule would be $0.6 million (400 million

times $3 million divided by 2 billion).

Therefore, estimated total operating or

recurring costs associated with the

proposed rule would be $12.6 (12 + 0.6).

These costs are shown in Table 8, row

2, column 3.

The ‘‘safe handling’’ rule did not

estimate operating costs of labeling for

processors because they were expected

to incur larger, upfront, one-time fixed

costs, associated with making

permanent modifications to labels.

Therefore, Table 8, row 1, column 3,

reports their operating costs as ‘‘Not

Applicable’’ (NA). The recurring costs of

nutrition labeling for processors other

than retail establishments are not

estimated in this rule because, again,

FSIS expects these processors to incur

larger, upfront, one-time fixed costs,

associated with making permanent

modifications to their existing labels.

Paperwork burden costs. FSIS

estimates that the one-time development

and recordkeeping costs associated with

nutrition labels for ground or chopped

products for Federal establishments and

retailers will total $8.8 million. As

explained above, FSIS estimates the

one-time costs to retail establishments

for obtaining point-of-purchase

materials that include nutrition

information for the major cuts of singleingredient, raw products will be about

$0.7 million. The paperwork burden

cost estimates for the required nutrition

labels for ground or chopped products

are based on the time required to

develop 3 nutrition labels (120 minutes

each), the time required for

recordkeeping for the supporting data at

Federal and retail establishments (5

minutes), and the time required for

Federal establishments to submit label

approval applications to FSIS (15

minutes). FSIS estimates that there are

2,489 Federal establishments affected by

the rule and 69,500 retail establishments

and estimates salary and expenses for

these activities to be $20 per hour.

Information concerning these costs is

addressed in the Information Collection

Request submitted to OMB and the

Paperwork Requirements section below.

Table 8 shows that total operating

compliance costs associated with

nutrition labels for ground or chopped

product are estimated at $12.6 million.

TABLE 8.—ESTIMATED COMPLIANCE COSTS FOR GROUND OR CHOPPED PRODUCTS ($ MILLION)

Fixed costs Operating

costs

Paperwork

burden

Low High costs

Processors ....................................................................................................................... 10.0 20.0 NA .3

Retailers ........................................................................................................................... 28.8 43.2 12.6 8.5

Total .......................................................................................................................... 38.8 63.2 12.6 8.8

Discounted value of compliance costs.

The low and high estimates of fixed

costs were added to the operating costs

and paperwork burden costs estimated

above. Therefore, FSIS obtained two

series of costs, low and high, for a

period of 20 years. The low estimate

was $60.2 million per year ($38.8

million + 12.6 million + 8.8 million)

and the high cost estimate was $84.6

million ($63.2 million + $12.6 million +

$8.8 million). These series were

discounted at 7 percent to compare

them with discounted benefits, which

are also discounted at 7 percent. It was

assumed that the costs would be

incurred in the middle of each year for

the next 20 years. The results revealed

that the present values of compliance

costs for the next 20 years (from 2001

to 2020) ranged from $659.69 million to

$927.05 million. Other than the

paperwork costs discussed above, there

should not be many costs associated

with nutrition labels that would exceed

the estimates in the ‘‘safe handling’’

rule. Nutrient content is dependent on

fat levels, and there is a direct

relationship between fat and other

nutrients. Producers should be able to

use available data or to extrapolate from

existing data to develop the data for

nutrition labels. In addition, FSIS will

develop a list of published sources of

information concerning the nutrient

content of ground or chopped products,

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4989

so that industry could obtain available

literature from local libraries. This

information would facilitate the

development of nutrition labels for

ground or chopped products. FSIS

requests comments and data on any

additional costs associated with

nutrition labels that were not included

in this preliminary cost analysis.

Although nutrition labels are not

currently required on single-ingredient,

raw ground or chopped products, such

labels are often provided voluntarily on

these products. According to

information submitted by CSPI, a

number of major supermarket chains,

including Dominick’s, Fred Meyer,

Jewel, Kroger, Wegman’s, Winn-Dixie,

Albertson’s, and some Lucky and

Safeway stores, now include full

‘‘Nutrition Facts’’ labels on their ground

beef (Bonnie Liebman, ‘‘Where’s the

Beef Labeling,’’ Nutrition Action

Healthletter (June 1999): 8–11). Because

FSIS does not have complete

information concerning the volume of

ground or chopped packages that bear

nutrition labels, FSIS is estimating the

costs of labels for all packages of ground

or chopped product in the cost

estimates above.

Impact of estimated costs. The

preceding estimates of fixed, operating

and paperwork burden compliance costs

for the proposed requirements

concerning ground or chopped product

at $60.2 to $84.6 million are not likely

to be excessive relative to the volume of

output of ground or chopped meat and

poultry products sold at retail. For

example, as noted above, the volume of

these products is estimated at 3.9 billion

pounds. Therefore, these costs would

range from 1.5 to 2 pennies per pound

($60.2 million/3.9 billion pounds to

$84.6 million/3.9 billion pounds). FSIS

has not conducted a thorough analysis

of how the costs to Federal and retail

establishments would affect the price,

supply, and demand of ground or

chopped products. Similarly, FSIS has

not thoroughly evaluated how any

changes in consumer behavior that may

occur as a result of this rule would

affect the price, supply, and demand of

ground or chopped products.

Percentage Labeling

The proposed percentage labeling for

ground or chopped products would not

result in significant costs because such

labeling would be optional rather than

mandatory. If retailers and other

producers found this labeling to be

costly, they would simply not exercise

this option. Because FSIS extended the

compliance enforcement date for use of

the term ‘‘lean’’ for these products,

pending publication of a final rule on

percentage labeling for lean and fat on

ground beef and hamburger, many of

these products already bear these

statements on their labels. If producers

chose to develop new labels, the costs

per label would be comparable to those

for printing nutrition labels ($0.0025 to

$0.05 per label if the information is

included as part of their price label,

and, $0.01 per label if they developed

separate labels). FSIS requests comment

on the costs and benefits of percent fat/

percent lean labeling on ground or

chopped products.

Benefits

The benefits of nutrition labeling

depend on the extent to which

consumers change their food

consumption in favor of products that

are more nutritious. As noted earlier,

the absence of nutrition labeling to

indicate nutrition contents of ground or

chopped meat and poultry products and

the major cuts of single-ingredient, raw

products does not allow consumers to

get adequate information for making

their purchasing decisions. Provision of

nutrition labels and point-of-purchase

materials would disseminate nutrition

information and enhance consumers’

food purchasing decision-making

process.

Consumption habits vary with

knowledge of nutrition and health,

preference for healthful diets, and

socioeconomic status of different

segments of the population. For

example, consumers with preferences

for healthful diets are likely to select

products with lower fat and cholesterol

levels to assist in the reduction of risk

for coronary heart problems and

cancerous diseases. Some consumers

might perceive that a product is of

higher quality or more nutritious if it

has lower fat and cholesterol contents.

Availability of nutrition labels on

ground or chopped meat and poultry

products and nutrition information for

the major cuts of single-ingredient, raw

products may help purchasing decisionmaking by these select groups of

consumers.

Literature review of impact of labeling

on diet quality. Nutrition labels on

products such as cereals have existed

for over two decades. Research studies

on the effect of nutrition labeling on diet

quality for these non-meat and poultry

products indicate a positive relationship

between these variables. Kreuter et al.

(1997) analyzed survey data of 885 adult

patients from four family medical

clinics in Missouri (see the

‘‘References’’ section below for full

citations of the literature referred to in

this discussion). To participate, patients

completed a self-administered survey

while waiting to see their physicians.

The results revealed that patients eating

diets lower in fat were much more likely

(51% versus 26%) than patients whose

diets were higher in fat to report that

nutrition labels influenced their food

purchasing decisions.

Guthrie et al. (1995) linked USDA’s

1989 Continuing Survey of Food Intakes

by Individuals (one database) to Diet

and Health Knowledge Survey (another

database). They concluded that label use

appeared to be associated with the

consumption of diets that were higher

in vitamin C and lower in cholesterol.

Neuhouser et al. (1999) analyzed data

from a survey of 1,450 adult residents in

Washington State. The survey assessed

nutrition label use, fat-related diet

habits, fruit and vegetable consumption,

diet-related psychosocial factors, health

behavior, and demographic

characteristics. They concluded that

label use was significantly associated

with lower fat intake and, after

controlling for all demographic,

psychosocial, and behavioral variables,

label use explained 6% of the variance

in fat intake (their conclusion had a

probability of 99.9%).

Mathios and Ippolito (1998) analyzed

the effect of nutrition information in

advertising and labels on consumption

of food cereals with fiber content. They

divided their study into two periods:

First, the period, 1978–1984, when the

FDA permitted printing of fiber content

on cereal boxes but did not permit

printing of any health claims, and the

period 1985–87 when health claims

were permitted. They concluded that in

concert with an increase in fiber intake

of cereals in their diets, the average

intakes of fat, saturated fat, and

cholesterol for both men and women

declined during both the periods, albeit,

the decline was greater during the

second period relative to the first. They

concluded that the increase in fiber and

the decrease in fat and cholesterol

consumption were associated with the

consumption of labeled cereals.

Preliminary benefits analysis. FSIS

consulted with ERS to develop the

following empirical analysis of the

benefits of nutrition labeling. The

estimated benefits take the form of

reductions in the incidence of coronary

heart disease and three types of cancer

which may accrue as consumers

improve their diet quality through

increased use of nutrition information

generated by the regulation. FSIS used

survey data on nutrient intake and label

use to correlate intake of fat, saturated

fat, and cholesterol to usage of existing

nutrition information. The Agency

estimated the value of the potential

changes from intake of fat, saturated fat,

4990 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

and cholesterol that could occur as

consumers respond to the newly

available nutrition information. FSIS

applied the model developed by Zarkin,

et. al. which links changes in the serum

cholesterol rate to changes in the

percentage of total calories from

polyunsaturated fat, saturated fat, and

dietary cholesterol (Gary A. Zarkin,

Nancy Dean, Josephine A. Mauskopf,

and Richard Williams, ‘‘Potential Health

Benefits of Nutrition Label Changes,’’

American Journal of Public Health 83(5)

(May 1993): 717–724; Gary A. Zarkin,

Nancy Dean, Josephine A. Mauskopf,

and Dierdre M. Neighbors, ‘‘Estimated

Benefits of Nutrition Label Changes:

Final Report, Volume 1,’’ Center for

Economics Research, Research Triangle

Institute, Research Triangle Park, NC,

27709. April 1991). Changes in serum

cholesterol are then used to estimate the

health outcomes, which are reductions

in the number of cases and mortality

from three cancers (breast, colorectal,

and prostate) and coronary heart

disease. Finally, the Agency attached

economic value to the public health

changes by estimating the implied value

of life associated with reductions in

premature mortality.

To determine how much of a

behavioral response and change in

dietary intake may result from providing

more nutrition information on meat and

poultry products, FSIS makes the

following assumption: The Agency

assumes that when labels and other

sources of nutrition information are

provided for raw meat and poultry

products that nutrition information

usage rates will rise to match label usage

rates for food products as a whole (see

Table 3). Currently, some nutrition

information is provided for some singleingredient, raw meat and poultry

products, but the information is not

currently required. Mandatory nutrition

labeling rules for the major cuts of

single-ingredient, raw products and

ground or chopped products would

mean the nutrition information

provided for these products would be

comparable to that provided for other

food products. FSIS therefore could

reasonably assume that nutrition

information usage rates for raw meat

and poultry products would then

become the same as the label usage rates

for all foods taken together. For

example, before mandatory nutrition

information labeling, the data show that

about 17 percent of men look for

nutrition information on meat ‘‘Often’’

(Row 2 of table 3). In this analysis, then,

FSIS assumed that after mandatory

nutrition information labeling, 26.7

percent of men would use the nutrition

fact panel or point-of-purchase materials

for meat products, which is the label

usage rate for all foods (Row 1 of table

3). Similarly, the Agency assumes that

the percentage of women using nutrition

information on meat products

‘‘Sometimes’’ would rise from 18

percent to 32.6 percent.

What does this mean for diet quality?

Here, FSIS made another (admittedly

strong) assumption: The Agency

assumed that as nutrition information

usage rates rise for consumers eating

meat and poultry, dietary patterns will

change in a manner consistent with

current data. As shown above, there is

strong statistical evidence that people

who use nutrition information to guide

their food consumption decisions have

healthier diets. While other factors may

be at work, and the role of information

use in causing dietary changes is

unclear, FSIS makes the assumption

that the provision of additional

nutrition information and making that

information available to more

consumers will lead to behavioral shifts

and increased diet quality. Thus, FSIS

assumes the effect of providing new

information for meat and poultry

products would make consumers who

NEVER used nutrition information for

meat and poultry products become

aware of the diet implications of their

choices in meat and poultry products.

These consumers would then choose to

consume the same mix of products as

people who are currently aware of the

nutritional quality of meat and poultry

products. For example, men who

currently do not look for nutrition

information on meat in the absence of

mandatory nutrition information

labeling who would begin using this

information ‘‘Sometimes’’ after labeling

is in place would see a decrease in fat

intake from 98 grams to 92.5 grams.

Under these assumptions, then, FSIS

could see how requirements for

mandatory nutrition information

labeling on raw meat and poultry

products could possibly affect diet

quality. To reach the values shown in

table 6, FSIS multiplied each cell in

table 5 by the associated percentage of

label use (nutrition facts panel use) from

table 3. By doing this, FSIS increased

the numbers of people in the ‘‘always’’

and ‘‘sometimes’’ cells, and decreased

the number of people in the ‘‘rarely’’

and ‘‘never’’ cells, so that the

distribution of label usage on meat and

poultry products would reflect the

distribution of label usage on all

products. Aggregating across categories,

FSIS got a new weighted average intake,

which could be seen after the

imposition of mandatory labeling

requirements.

TABLE 9.—CHANGE IN INTAKE DUE TO INCREASED LABEL USAGE

Intake prior to

mandatory nutrition labeling

of meat &

poultry

After adjusting

for increased

label usage

Percentage

decrease in

intake

Men:

Total Fat ............................................................................................................................... 92.51 91.31 1.30

Saturated Fat ........................................................................................................................ 31.12 30.69 1.37

Cholesterol ............................................................................................................................ 339.07 334.95 1.21

Women:

Total Fat ............................................................................................................................... 60.16 58.57 2.65

Saturated Fat ........................................................................................................................ 19.71 19.21 2.55

Cholesterol ............................................................................................................................ 210.53 208.16 1.13

Note: Fat intake in grams, cholesterol in milligrams.

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4991

TABLE 10.—CHANGE IN PERCENTAGE OF CALORIES FROM FAT AND CHOLESTEROL INTAKE DUE TO INCREASED LABEL

USAGE

Intake prior to

mandatory nutrition labeling

of meat &

poultry

After adjusting

for increased

label usage

Percentage

decrease in

calories from

fat or intake

Men:

Total Fat ............................................................................................................................... 33.44 33.33 0.11

Saturated Fat ........................................................................................................................ 11.19 11.14 0.04

Cholesterol ............................................................................................................................ 339.07 334.95 4.12

Women:

Total Fat ............................................................................................................................... 32.49 32.37 0.11

Saturated Fat ........................................................................................................................ 10.64 10.54 0.10

Cholesterol ............................................................................................................................ 210.53 208.16 2.37

Note: Fat and saturated fat values are percent calories from fat. Cholesterol is mg.

Evaluation of health effects. Based on

epidemiological research, FSIS related

the reductions estimated in Table 10 to

estimated decrease in incidence of

major diseases associated with

consumption of fat and cholesterol. The

diseases considered in this analysis

include three types of cancer—breast,

prostate, and colon/rectal—and

coronary heart disease. Epidemiological

studies of the relationships between

dietary fat and cholesterol intake and

incidence of cancer and coronary heart

disease indicate that saturated and

polyunsaturated fat and cholesterol are

converted into serum cholesterol. Serum

cholesterol has an impact on the

incidence rates of these diseases. FSIS

used the following equation from Zarkin

et al. (1993) to convert fat contents into

the change in serum cholesterol (SC)

rate, in milligram/deciliter (mg/dl):

(1) SC (Mg/dl) = 2.16S - 1.65P + 0.097C

Where SC is serum cholesterol, S is the

change in percentage of total calories

represented by saturated fat, P is the

change in percentage of total calories

represented by polyunsaturated fat, and

C is the change in dietary cholesterol

measured in mg/1000 calories.

FSIS substituted the estimated values

of percentage changes in saturated fat

and cholesterol intake from the last

column of Table 10 into this equation.

Since FSIS did not have separate data

for polyunsaturated (P) fat, it was

assumed that P would be one-third of

total fats, as was also assumed by Zarkin

et al. The estimates of serum cholesterol

for male and female consumers are as

follows:

TABLE 11.—REDUCTION IN SERUM CHOLESTEROL AND CHANGE IN MORTALITY

% Change

in calories

from total

fat

% Change

in calories

from sat. fat

Change in

cholesterol

intake

Change in

serum

cholesterol

%

Reduction in

mortality

Men .......................................................................................................... 0.11 0.04 4.12 0.399 0.0240

Women ..................................................................................................... 0.11 0.10 2.37 0.231 0.0139

FSIS used the calculated values of SC

presented above to estimate incidence of

breast, prostate, colon/rectal cancer, and

coronary heart disease. Zarkin et al.

(1993) concluded that an increase in

serum cholesterol by 20 mg/dl was

associated with a 1.2-percent increase in

the incidence of each of these diseases.

FSIS employed this rate to convert

reductions in total fat, saturated fat, and

cholesterol in Table 10 into SC. It is

estimated that the reduction in mortality

associated with changing dietary pattern

from mandatory nutrition information

labeling are 0.024 percent for men, and

about 0.014 percent for women.

TABLE 12.—REDUCTION IN MORTALITY, ANNUAL NEW CASES OF MORTALITY, AND ESTIMATED LIVES SAVED

Reduction in mortality

(%)

Annual new cases of

mortality

Lives saved

1234567

Men Women Men Women Men Women Total

Breast Cancer ...................................................................... ................ 0.0139 ................ 41,200 066

Prostate Cancer ................................................................... 0.0240 ................ 31,900 ................ 8 0 8

Colorectal Cancer ................................................................ 0.0240 0.0139 28,000 28,000 7 4 11

Coronary Heart Disease ...................................................... 0.0240 0.0139 231,332 228,769 55 32 87

Table 12 presents data on the annual

new cases of mortality associated with

the three types of cancer and coronary

heart disease for men and women in the

United States in 1998. Data for the

number of deaths came from the

National Center for Health Statistics

(coronary heart disease) and the

American Cancer Society (cancer). Data

on colorectal cancer were not available

by gender; FSIS assumed the estimated

56,000 cases were distributed equally

between men and women.

Estimating the benefits of preventing

premature death. The benefits of the

4992 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

proposed nutrition information labeling

rule would be the lives saved due to the

estimated reductions in mortality rates

associated with these diseases.

However, placing reduction of the risk

of premature death in an economic

context is difficult and controversial (for

an in-depth analysis of this issue, see

Fred Kuchler and Elise Golan,

‘‘Assigning Value to Life: Comparing

Methods for Valuing Health Risks,’’

Agricultural Economic Report No. 784,

U.S. Dept. Agric., Econ. Res. Service,

Washington, DC, Nov. 1999). The

problem is that there is no market for

reducing diet-related fatal risks. If food

were marketed by risk levels (say,

probabilities of inducing cancer or heart

disease) and consumers treated

advertised risk levels like they do other

objectively measurable product

characteristics (e.g., weight or volume),

there would be little difficulty in

valuing food safety. Product prices

could be statistically associated with

risk levels, yielding the risk-dollar

trade-off consumers make. That is, FSIS

could measure, based on consumer

purchases, the dollar value consumers

attach to particular types of risk

reduction.

There is no price that can be tabulated

from commercial transactions that

reflects the value of reducing dietrelated fatal risks. Actions that

individuals might take to reduce these

risks do not leave a behavioral trail for

analysts to follow. This information

void makes it difficult to evaluate

programs that might reduce diet-related

risks. In particular, there is no obvious

dollar value to assign to the major

benefit of such programs, namely lives

saved.

Ultimately, FSIS wanted to monetize

the benefits of diet-related fatal health

risk reduction. Other risks do leave a

clear behavioral trail that analysts have

followed, measuring the risk-dollar

trade-off individuals make. The

Agency’s goal was to find a method of

transferring market-based risk-dollar

trade-off estimates to diet-related fatal

cancer risks.

The most studied risk choices are

those for on-the-job risks of accidental

injury and death. Analysts have

estimated the compensation required to

induce workers to accept such risks.

Many studies of labor market behavior

have been carried out because the wide

range of risk levels workers accept and

the wide range of wages paid are

amenable to statistical analysis.

Available evidence suggests that

workers’ subjective assessments of risks

they face are plausible (W.K. Viscusi,

Fatal Tradeoffs—Public & Private

Responsibilities for Risk. New York:

Oxford University Press, 1992).

Viscusi (1992) summarized the

empirical work estimating the value of

risk of premature death. Several studies

estimate the risk-dollar trade-off in the

labor market by dividing the wage

premium for risky jobs by the risk of a

fatal job injury. Drawing on the

compiled results of these studies, he

stated: ‘‘Although the estimates of the

risk-dollar tradeoff vary considerably

depending on the population exposed to

the risk, the nature of the risk, and

similar factors, most of the reasonable

estimates of the value of life are

clustered in the $3 to $7 million range’’

(p. 73). Thus, compensating wages

indicate that, on average, industrial

workers value a statistical life at $5

million (December 1990 dollars), the

midpoint of the range. ERS currently

uses the $5 million per life estimate

(adjusted upwards for inflation to 2000

dollars) to measure the benefits of

preventing premature death from

foodborne diseases caused by microbial

pathogens (such as E. coli O157:H7,

Salmonella, and Listeria

monocytogenes.) (Crutchfield, Roberts,

Buzby, and Frenzen, ‘‘ Food Safety

Efforts Accelerate in the 1990’s,’’ Food

Review, 23 (3), September-December

2001, forthcoming). This estimate has

been used by other government agencies

to evaluate the benefits of regulations

designed to reduce the risk of premature

death. For example, The Food and Drug

Administration (Procedures for the Safe

and Sanitary Processing and Importing

of Fish and Fishery Products Final Rule,

60 FR 65095) and the Consumer Product

Safety Commission (Miller et al., ‘‘The

Consumer Product Safety Commission’s

Revised Injury Cost Model,’’ Peer

Review Draft Prepared for the U.S.

Consumer Product Safety Commission,

July 1, 1997) currently use Viscusi’s

mid-point value of $5 million for each

life saved. (Kuchler and Golan,

‘‘Assigning Value to Life: Comparing

Methods for Valuing Health Risks,’’

Agricultural Economic Report No. 784,

U.S. Department of Agriculture,

Economic Research Service,

Washington, DC, November 1999, page

25). However, other agencies use lower

life values in their analyses. FSIS

requests comments on whether $5

million is an appropriate value of life

estimate.

FSIS used the $5 million estimate as

reflecting willingness to pay to avoid

health risks. This is not the value an

individual would pay to save his own

life, but the aggregate value paid by

many individuals to reduce a small risk

of death each faces. To make this

transfer, FSIS assumed that individuals

make consistent risk choices, reducing

health risks as much as their budgets

allow. The Agency assumed individuals

focus on the likelihood of health

outcomes and how bad the outcomes

might be, without regard to the different

physical characteristics of hazards that

give rise to health risks. The assumption

critical for making the transfer from

valuing job risks to valuing cancer risks

is that individuals value years of life,

and all years are equally valuable. All

individuals are assumed to value a year

of life equally.

FSIS adjusted for differences between

years of life lost to cancer and heart

disease fatalities and years of life lost to

workplace fatalities. The value of

statistical life estimate is based on a

worker anticipating a fatal injury and

losing an average life expectancy of 36.5

years (W.K. Viscusi, W.K. Cigarette

taxation and social consequences of

smoking. In James M. Poterba (ed.), Tax

Policy and the Economy. Volume 9.

Cambridge: MIT Press for the National

Bureau of Economic Research, 1995).

Potential life years lost to cancer and

heart disease deaths were calculated by

FSIS using data from National Centers

for Health Statistics (National Center for

Health Statistics, National Vital

Statistics Report 48 (11) (July 24, 2000):

167). NCHS reports the number of years

lost before age 75 per 100,000

population under the age of 75. These

data were divided by the number of

cancer and heart disease deaths for the

population under 75 years of age to

estimate the average number of life

years lost up to age 75. The average

number of life years lost were 14.9 for

breast cancer, 3.9 for prostate cancer,

9.56 for colorectal cancer, and 10.2 for

coronary heart disease. Thus, to

calculate a value of life lost to cancer or

heart disease, FSIS adjusted the $5

million estimate downward to reflect

the fewer years of life lost to cancer or

heart disease, compared to work-related

deaths. This calculation is similar to

that carried out by Viscusi for

estimating the value of statistical lives

lost to environmental tobacco smoke

(Viscusi, 1995).

FSIS treated the last 36.5 years of life

(L36.5) as a capital asset with a current

value of $5 million. If the risk market

could be characterized as an efficient

market, the asset price should be equal

to the present value of the service flow

the asset produces.

L dt 36 5. = $5 ∫ million = Re-rt

0

36.5

R is the (assumed) constant annual

value of life and r is the time preference

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4993

rate used to discount future benefits.

Consider now the case of an individual

facing an expected loss of 10.2 years of

life from coronary heart disease. From

this perspective, the value of the last

10.2 years of life for a victim of coronary

heart disease is

L10.2 = e¥26.3rr¥1R(1 ¥ e¥10.2r).

The equations for both L36.5 and L10.2

can be solved for R and equated,

yielding

L10.2 = L36.5 e¥26.3r(1 ¥ e¥36.5r)¥1.

The value of cancer avoidance depends

on an individual’s rate at which future

years of life are discounted. At an

interest rate of 7 percent, the value is

$636,755. At an interest rate of 3

percent, the value is $1,056,261.

This estimate is in December, 1990

dollars. Using the CPI–U to update this

estimate from 1990 to 2000 dollars (CPI–

U = 133.8 in December 1990, and 171.3

average for 2000), the value becomes

$815,218 (7 percent discount rate) and

$1,352,298 (3 percent) in 2000 dollars.

Similar calculations were made for

deaths associated with the other three

diseases considered (which take into

account the different number of life

years lost for each disease). The results

are reported in Tables 13 and 14. To

arrive at an estimate of the benefits

associated with reductions in mortality

due to changes in fat and cholesterol

intake, FSIS multiplied the dollar value

assigned to each premature death

prevented by the number of lives saved

due to changes in diet quality. This

estimate is reported for each disease as

‘‘Total benefits per year’’ in Tables 13

and 14. The total for all diseases is $86.6

million dollars at a 7 percent discount

rate and $145.2 million at 3 percent.

It should be noted that the

calculations used to estimate present

value explicitly account for the time

factor associated with delayed health

impacts of dietary change. Decreases in

intake of saturated fat, fat, and

cholesterol will reduce the incidence of

heart disease and cancer, but not

immediately—the reductions in illness

and death will begin to occur years into

the future. However, the formulas used

for calculating the present value of the

benefits explicitly take this into

account, for they reflect the value

placed on lost years of life occurring in

the future.

TABLE. 13—ESTIMATED LIVES SAVED AND ASSOCIATED ECONOMIC BENEFITS, USING A 7 PERCENT DISCOUNT RATE

Breast cancer Prostate cancer

Colorectal

cancer

Coronary heart

disease All diseases

Deaths Per Year .................................................................. 41,200 31,900 28,028 228,231 329,359

Lives Saved Due to Dietary Changes from Labeling .......... 6 8 11 87 111

Years of Life Lost Per Premature Death ............................. 14.9 3.9 9.6 10.2 N/A

Dollar Value of 1 Life Saved ($) .......................................... 1,032,665 384,390 780,670 815,218 N/A

Total Benefits Per Year ($) .................................................. 5,906,020 1,513,329 8,273,399 70,936,607 86,629,355

20 Year Present Value ($) ................................................... 62,568,456 16,032,277 87,648,507 751,503,430 917,752,620

NOTE: Cancer deaths are for 2000, heart disease deaths are for 1998. Number of lives saved is rounded to the nearest integer. All benefits estimates are in year 2000 dollars.

TABLE. 14—ESTIMATED LIVES SAVED AND ASSOCIATED ECONOMIC BENEFITS, USING A 3 PERCENT DISCOUNT RATE

Breast cancer Prostate cancer Colorectal cancer Coronary heart

disease All diseases

Deaths Per Year (1998) ......................... 41,200 31,900 28,028 228,231 329,359

Lives Saved ........................................... 6 8 11 87 111

Years of Life Lost Per Death ................. 14.9 3.9 10.6 10.2 N/A

Dollar Value of 1 Life Saved ($) ............ 1,844,723 570,731 1,395,308 1,352,298 N/A

Total Benefits Per Year ($) .................... 10,550,343 2,246,945 14,787,213 117,670,918 145,255,419

20 Year Present Value ($) ..................... 156,962,464 33,428,870 219,996,395 1,750,646,120 2,161,033,850

NOTE: Cancer deaths are for 2000, heart disease deaths are for 1998. Number of lives saved is rounded to the nearest integer. All benefits are

in year 2000 dollars.

It should be kept in mind that these

estimates are based on annual data, and

represent only one year’s benefits. FSIS

assumed that the reduction in mortality

would continue each year. Using a

twenty-year time horizon, FSIS

estimated the present value (discounted

at seven percent and three percent) of

continuing reduction in premature

deaths. This estimate was $918 million

for all diseases at 7 percent, and $2.161

billion at 3 percent. FSIS requests

comment on the benefits analysis above.

Summary of costs and benefits of the

proposed nutrition labeling rule. As

discussed above, FSIS’ preliminary

analysis does not allow for a

comparison of the net benefits among

the regulatory options considered.

For the proposed rule, the present

values of benefits estimated in the two

scenarios with 7 and 3 percent discount

rates, respectively, range from $918

million to $2.161 billion. The present

value (at a 7 percent discount rate for 20

years) of annualized fixed costs,

operating and paperwork burden costs

(including paperwork costs for

providing nutrition information for the

major cuts) for the lower bound estimate

amounts to $659.69 million. In case the

higher estimate of fixed costs is used,

the fixed, the operating, and the

paperwork burden costs amount to

$927.05 million, at a 7 percent discount

rate for 20 years.

Percentage labeling. This proposed

rule would allow but would not require

a statement of the fat and lean

percentage in ground or chopped

products. FSIS believes that this

nutrition information helps consumers

make better food choices and provides

incentives to producers to continue

producing nutritionally-improved

products which contribute substantially

to the health benefits associated with

nutrition labeling. However, FSIS does

not have the data necessary to quantify

these benefits. FSIS requests comments

concerning the benefits of percentage

labeling on ground or chopped

products.

4994 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

Regulatory Flexibility Act (RFA)—

Preliminary Analysis

Based on the cost analysis above, FSIS

has made an initial determination that

this rule will not have a significant

economic impact on a substantial

number of small entities, as defined by

the Regulatory Flexibility Act (5 U.S.C

601). In the cost analysis above, FSIS

estimated that the total costs for

required nutrition labels on ground or

chopped products would be between 1.5

and 2 pennies per pound. Also, as stated

above, FSIS believes that the cost of

providing nutrition labeling for the

major cuts of single-ingredient, raw

meat products should be negligible.

FSIS estimates the total one-time costs

to all retail establishments combined for

obtaining point-of-purchase materials

that include nutrition information for

the major cuts of single-ingredient, raw

products will be about $0.7 million.

The data in Table 1 in the ‘‘Baseline’’

section above suggest that about onehalf of the poultry plants were large (28

out of 63) in 1999. The number of

‘‘small’’ and ‘‘very small’’ poultry plants

was 23 and 10 respectively. In the

absence of the availability of any data

on production levels of these plants,

FSIS assumes that the very small plants

with less than ten employees are likely

to produce less than 100,000 pounds per

ground poultry product. This

assumption is not unrealistic because

poultry grinding is a labor-intensive

process and less than ten employees are

not likely to produce more than 100,000

pounds per ground product because

these employees also process other

products in these plants. Based on this

assumption, 10 very small poultry

establishments (or only 15% of all

poultry establishments) are likely to be

exempt from nutrition labeling

requirements for ground or chopped

products. However, these

establishments would not be exempt if

they are owned by a large corporation

that owns several plants and employs

500 or more workers among all of its

plants or produces more than 100,000

pounds of a particular ground product

in total among all of its plants. FSIS did

not have data linking these

establishments to their corporate

ownership.

The EFD indicates that most of the

ground meat producing plants are very

small. For example, of the 2,426 ground

meat establishments, 1470 or 60% are

very small. The number of small and

large ground meat establishments are

843 and 68, respectively. Therefore,

assuming that the very small

establishments produce less than

100,000 pounds of a particular ground

meat product, 60% of all these plants

would be exempt from nutrition

labeling requirements for ground or

chopped products. In practice, the

number of plants that would be exempt

may be smaller than 60 percent because

many of these plants may be owned by

large, multi-plant corporations.

However, FSIS does not have data on

corporations that own these individual

establishments.

As discussed above, FSIS believes

that a significant amount of ground beef

is processed at retail. Table 2 in the

‘‘Baseline’’ section above shows the

number of retail stores in 1999. Most of

these stores grind beef. However, FSIS

does not have specific data concerning

the levels of ground beef ground at retail

or on the size of retail stores that

process ground beef. FSIS researched

Census data for this information, but

specific information related to retail

establishments processing ground or

chopped product was unavailable.

Therefore, FSIS does not currently have

all the data necessary for a

comprehensive analysis on the effects of

this rule on small entities. In addition

to the lack of data on retail stores

producing ground or chopped product,

FSIS does not have data on the specific

types and quantities of ground products

produced in individual plants to

determine the number of single-plant

facilities or multi-plant companies or

firms that would be exempt from this

regulation. Therefore, FSIS is requesting

this information and inviting comments

concerning potential effects. In

particular, FSIS is interested in

determining the number and kind of

small entities that may incur benefits or

costs from implementation of this

proposed rule.

FSIS will make available a list of

published sources of information so that

industry can obtain literature from local

libraries. This information will assist in

the development of nutrition labels for

ground or chopped products. This list of

published sources of information should

also help minimize the economic effect

of this rule on small entities.

FSIS is cognizant of the possibility

that while the exempted establishments

would not have to incur labeling costs,

they might not realize benefits of greater

sales of the labeled products, in case

they choose not to nutritionally label

their products. This is because if

demand for the labeled product

increases relative to demand for nonlabeled products, the exempt

establishments would lose their market

shares to the nonexempt establishments

producing nutritionally labeled

products. Therefore, to keep their

market shares, these exempt

establishments are likely to voluntarily

include nutrition information on the

product label. Such a strategy would

minimize the adverse impact on these

smaller establishments. It would,

however, also increase their costs

associated with labeling. Economic

theory dictates that these establishments

would compare the costs of nutrition

labels with the benefits of retaining their

market shares and would decide to label

their products if the benefits of

increasing the market shares exceed the

label costs.

Nutrition labeling would be required,

either on the product label or on pointof-purchase materials, for the major cuts

of single-ingredient, raw product.

Therefore, if manufacturers do not

provide nutrition information on the

label, retailers would be required to

provide this information at the point-ofpurchase or on product labels. However,

as noted above, this requirement should

not impose major costs or other burdens

because many stores are currently

providing nutrition information for

these products, point-of-purchase

materials are available for a nominal fee

through FMI’s web site ($12.00 for

members, $24.00 for nonmembers), and

FSIS intends to make point-of-purchase

materials available, free of charge, on

the FSIS web site.

The economic impact on retail stores

is likely to be minimal because recently

there has been considerable

consolidation of these stores due to

mergers and acquisitions resulting in an

increased market share of large retailers

relative to small ones. For example,

recently Royal Ahold, the Dutch

Conglomerate, bought out Giant Food.

Earlier last year, Ahold also announced

the pending purchase of Supermarket

General-II Holdings Corporation, parent

of the Pathmark chain. Similarly,

SUPERVALUE acquired Richfood, Food

Lion bought out Hannaford Brothers,

and Scarborough, and Albertson’s

purchased American Stores. (Sean

Mehegan, ‘‘Consolidation Changes the

Face of the North American

Supermarket Sector,’’ Meat & Poultry

(September 1999): 22–25). These

mergers and acquisitions are likely to

increase market shares of the large

retailers at the cost of smaller ones.

Table 2 in the ‘‘Baseline’’ section

above shows the number of retail

grocery stores in 1999. The economic

impact of the first-year costs of

compliance on the processors and the

retailers is determined by dividing the

total first-year costs by the number of

processors or retailers. Table 8 revealed

the range of first-year costs to processors

for labeling ground or chopped products

at $10.3 million to 20.3 million. These

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4995

costs include the fixed costs, operating

costs, and the paperwork burden costs.

Since the number of processors is 2,489

(see Table 1), the impact per processor

would range from $4,138.21 ($10.3

million/2,489) to $8,155.89 ($20.3

million/2,489). Similarly, Table 8 also

shows that the first-year costs to

retailers for labeling ground or chopped

products range from $ 49.90

million($28.8 + $12.6 million + $8.5

million) to $ 64.3 million ($43.2 million

+ $12.6 million +$8.5 million). In

addition, as explained above, the total

paperwork burden costs to retailers for

providing point-of-purchase materials

for the major cuts of single-ingredient,

raw products is approximately $0.7

million. Thus, the total costs to retailers

would range from $50.6 million to $65

million. Since the number of retail

stores (see Table 2) in 1999 was 69,500

(excluding convenience stores that do

not normally sell meat products), the

impact per retail store would range from

$728.06 ($50.6 million/69,500) to

$935.25 ($65 million/69,500). Therefore,

the impact of the first-year cost would

be greater on the processors relative to

retailers.

Executive Order 12988

This proposed rule has been reviewed

under Executive Order 12988, Civil

Justice Reform. States and local

jurisdictions are preempted by the

Federal Meat Inspection Act (FMIA) and

the Poultry Products Inspection Act

(PPIA) from imposing any marking,

labeling, packaging, or ingredient

requirements on federally inspected

meat and poultry products that are in

addition to, or different than, those

imposed under the FMIA or the PPIA.

However, States and local jurisdictions

may exercise concurrent jurisdiction

over meat and poultry products that are

outside official establishments for the

purpose of preventing the distribution

of meat and poultry products that are

misbranded or adulterated under the

FMIA or PPIA, or, in the case of

imported articles, which are not at such

an establishment, after their entry into

the United States.

The proposed rule is not intended to

have retroactive effect.

If this proposed rule is adopted,

administrative proceedings will not be

required before parties may file suit in

court challenging this rule. However,

the administrative procedures specified

in §§ 306.5 and 381.35 must be

exhausted before there is any judicial

challenge of the application of the

proposed rule, if the challenge involves

any decision of an FSIS employee

relating to inspection services provided

under FMIA and PPIA.

Public Notification and Request for

Data

FSIS requests information regarding

the impact of this proposed rule on

minorities, women, and persons with

disabilities, including information on

the number of minority-owned meat and

poultry establishments, the makeup of

establishment workforces, and the

communities served by official

establishments.

Public involvement in all segments of

rulemaking and policy development are

important. Consequently, in an effort to

better ensure that minorities, women,

and persons with disabilities are aware

of this proposed rule and are informed

about the mechanism for providing their

comments, FSIS will announce it and

provide copies of this Federal Register

publication in the FSIS Constituent

Update. FSIS provides a weekly FSIS

Constituent Update, which is

communicated via fax to over 300

organizations and individuals. In

addition, the update is available on line

through the FSIS web page located at

http://www.fsis.usda.gov. The update is

used to provide information regarding

FSIS policies, procedures, regulations,

Federal Register notices, FSIS public

meetings, recalls, and any other types of

information that could affect or would

be of interest to our constituents/

stakeholders. The constituent fax list

consists of industry, trade, and farm

groups, consumer interest groups, allied

health professionals, scientific

professionals, and other individuals that

have requested to be included. Through

these various channels, FSIS is able to

provide information to a much broader,

more diverse audience. For more

information and to be added to the

constituent fax list, fax your request to

the Congressional and Public Affairs

Office, at (202) 720–5704.

Paperwork Requirements

Title: Nutrition labeling of ground or

chopped meat and poultry products and

single-ingredient products.

Type of Collection: New.

Abstract: FSIS has reviewed the

paperwork and record keeping

requirements in this proposed rule in

accordance with the Paperwork

Reduction Act. Under this proposed

rule, FSIS is requiring several

information collection and

recordkeeping activities. FSIS is

proposing to require nutrition labeling

on the major cuts of single-ingredient,

raw meat and poultry products, either

on their label or at their point-ofpurchase, unless an exemption applies.

If the manufacturer provides nutrition

information on the label of individual

packages of the major cuts of singleingredient, raw meat or poultry

products, the retailer would not be

required to provide the information at

the point-of-purchase. However, if the

manufacturer does not provide the

nutrition information on the label of

these products, the retailer would be

required to provide the information at

their point-of-purchase. In the estimate

of burden below, FSIS is estimating that

all retailers would display point-ofpurchase information for the major cuts

of single-ingredient, raw meat and

poultry products, because this is an

inexpensive means of providing

nutrition information for multiple

products and because this rule will not

require that manufacturers include

nutrition labels on the major cuts of

single-ingredient, raw meat and poultry

products. FSIS is also proposing to

require nutrition labels on all ground or

chopped meat and poultry products,

with or without added seasonings,

unless an exemption applies.

Estimate of burden: FSIS estimates

that obtaining point-of-purchase

materials and making them available for

consumers would take an average of 30

minutes. FSIS believes that the nutrition

information on most point-of-purchase

materials will be based on the most

current representative database values

contained in USDA’s National Nutrient

Data Bank or the USDA Nutrient

Database for Standard Reference. FSIS

also believes it is unlikely that there

will be any nutrition claims made on

the point-of-purchase materials on the

basis of the representative data base

values. Therefore, these products will

not be subject to FSIS compliance

review, and there will be no

recordkeeping requirements based on

this information.

FSIS estimates that developing

nutrition labels for ground or chopped

products would take an average of 120

minutes. Labels developed at official

establishments would be submitted to

FSIS. FSIS estimates that each official

establishment that produces ground or

chopped product would submit three

labels to FSIS for approval. FSIS

estimates that it would take an average

of 15 minutes to prepare and submit the

form for prior approval. All ground or

chopped product would be subject to

FSIS compliance review; therefore,

producers of ground or chopped

product would be required to maintain

records to support the validity of

nutrient declarations contained on

product labels. FSIS estimates the

average time for recordkeeping would

be 5 minutes.

Respondents: Meat and poultry

establishments and retail stores.

4996 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

Estimated number of respondents:

71,989.

Estimated number of responses per

respondent: 3.

Estimated total annual burden on

respondents: 474,549.

Copies of this information collection

assessment can be obtained from Lee

Puricelli, Paperwork Specialist, Food

Safety and Inspection Service, USDA,

112 Annex, 300 12th St., Washington,

DC 20250.

Comments are invited on: (a) Whether

the proposed collection of information

is necessary for the proper performance

of the functions of the Agency,

including whether the information will

have practical utility; (b) the accuracy of

the Agency’s estimate of the burden of

the proposed collection of information

including the validity of the

methodology and assumptions used; (c)

ways to enhance the quality, utility, and

clarity of the information to be

collected; and (d) ways to minimize the

burden of the collection of information

on those who are to respond, including

through the use of appropriate

automated, electronic, mechanical, or

other technological collection

techniques or other forms of information

technology.

Comments may be sent to Lee

Puricelli, see address above, and the

Desk Officer for Agriculture, Office of

Information and Regulatory Affairs,

Office of Management and Budget,

Washington, DC 20253. Comments are

requested by February 20, 2001. To be

most effective, comments should be sent

to OMB within 30 days of the

publication date.

References

American Cancer Society. ‘‘2000 Facts and

Figures: Selected Cancers.’’ http://

www.cancer.org/statistics/cff2000/

selectedcancers.html

The American Meat Institute Foundation.

Relative Ground Beef Contribution to the

United States Beef Supply. May 1996.

National Center for Health Statistics: Health,

United States, 2000. U.S. Department of

Health and Human Services, Centers for

Disease Control and Prevention, Division

of Data Services, Hyattsville, MD, 2000.

National Center for Health Statistics:

National Vital Statistics Report. Vol. 48,

No. 11, July 24, 2000. U.S. Department

of Health and Human Services, Centers

for Disease Control and Prevention,

Division of Data Services, Hyattsville,

MD.

Retail Diagnostics, Inc. U.S. Department of

Agriculture Nutrition Labeling and Safe

Handling Information Study: December

1996, final report, March 19, 1997.

Retail Diagnostics, Inc. U.S. Department of

Agriculture Nutrition Labeling and Safe

Handling Information Study: October

1999, draft report, December 10, 1999.

Campbell, Robert. ‘‘Ground Beef Testing:

Determining Fat Content and

Distribution,’’ Meat and Poultry,

October, 1997.

Crutchfield, S.R., T.A. Roberts, P.D. Frenzen,

and J.C. Buzby. ‘‘Food Safety Efforts

Accelerate in the 1990’s’’ Food Review,

Vol. 23, No. 3, September-December

2000, forthcoming.

Field, R.A. ‘‘Bone Marrow Measurements for

Mechanically Recovered Products from

Machines that Press Bones,’’ Meat

Science, Vol. 51. 2000.

Guthrie, J.F., J.J. Fox, L.E. Cleveland, and S.

Welsh. ‘‘Who Uses Nutrition Labeling,

and What Effects Does Label Use Have

on Diet Quality,’’ Research Article,

Society for Nutrition Education, 1995,

163–172.

Kim, Sung-Yong, Rodolfo M. Nagaya, Jr., and

Oral Capps, Jr. ‘‘The Effect of Food Label

Use on Nutrient Intakes: An Endogenous

Switching Regression Analysis.’’ Journal

of Agricultural and Resource Economics,

Vol. 25, No. 1, pp. 215–231. 2000.

Kreuter, M.W., L.K. Brennan, D.P. Schrff, and

S.N. Lukwago, ‘‘Do Nutrition Label

Readers Eat Healthier Diets? Behavioral

Correlates of Adults’ Use of Food

Labels,’’ American Journal of Preventive

Medicine, Vol. 13, No. 4, 1997, 277–283.

Kuchler, Fred, and Elise Golan. ‘‘Assigning

Value to Life: Comparing Methods for

Valuing Health Risks.’’ Agricultural

Economic Report No. 784, U.S. Dept.

Agric., Econ. Res. Service, Washington,

DC, Nov. 1999.

Liebman, Bonnie. ‘‘Where’s the Beef

Labeling,’’ Nutrition Action Healthletter,

June 1999, 8–11.

Mathios, A.D. and P.M. Ippolito. ‘‘Food

Companies Spread Nutrition Information

Through Advertising and Labels,’’ Food

Review, May-August, 1998, 38–43.

Mehegan, Sean, ‘‘Merger Mania—

Consolidation Changes the Face of the

North American Supermarket Sector,’’

Meat & Poultry, September 1999, 22–25.

Miller, T.R., B.A. Lawrence, A.M. Jensen,

G.M. Waehrer, R.S. Spicer, D.C. Lestina,

and M.A. Cohen. ‘‘The Consumer

Product Safety Commission’s Revised

Injury Cost Model,’’ Peer Review Draft

Prepared for the U.S. Consumer Product

Safety Commission, July 1, 1997.

Neuhouser, M.L, A.R. Kristal, and R.E.

Patterson. ‘‘Use of Food Nutrition Labels

is Associated with Lower Fat Intake,’’

Journal of the American Dietetic

Association, Vol. 99, No. 45, 1999, 45–

53.

Viscusi, W.K. 1992. Fatal Tradeoffs—Public

& Private Responsibilities for Risk.

Oxford University Press. New York.

Viscusi, W.K. 1995. Cigarette taxation and

social consequences of smoking. In

James M. Poterba (ed.), Tax Policy and

the Economy. Volume 9. MIT Press for

the National Bureau of Economic

Research. Cambridge.

Zarkin, Gary A., Nancy Dean, Josephine

Mauskopf, and Richard Williams,

‘‘Potential Health Benefits of Nutrition

Label Changes,’’ American Journal of

Public Health, 83(5) May 1993: 717–724.

Zarkin, Gary, Nancy Dean, Josephine A.

Mauskopf, and Dierdre M. Neighbors,

‘‘Estimated Benefits of Nutrition Label

Changes: Final Report, Volume 1.’’

Center for Economics Research, Research

Triangle Institute, Research Triangle

Park, NC 27709. April 1991.

List of Subjects

9 CFR Part 317

Food labeling, Food packaging, Meat

Inspection, Nutrition, Reporting and

recordkeeping requirements.

9 CFR Part 381

Food labeling, Food packaging,

Nutrition, Poultry and poultry products,

Reporting and recordkeeping

requirements.

For the reasons discussed in the

preamble, FSIS is proposing to amend 9

CFR Chapter III, as follows:

PART 317—LABELING, MARKING

DEVICES AND CONTAINERS

1. The authority citation for part 317

would continue to read as follows:

Authority: 21 U.S.C 601–695; 7 CFR 2.18,

2.53.

2. Section 317.300 would be revised

to read as follows:

§ 317.300 Nutrition labeling of meat and

meat food products.

(a) Unless the product is exempted

under § 317.400, nutrition labeling must

be provided for all meat and meat food

products intended for human

consumption and offered for sale,

except single-ingredient, raw products

that are not ground or chopped products

described in § 317.301 and are not major

cuts of single-ingredient, raw meat

products identified in § 317.344.

Nutrition labeling must be provided for

the major cuts of single-ingredient, raw

meat products identified in § 317.344,

either in accordance with the provisions

of § 317.309 for nutrition labels, or in

accordance with the provisions of

§ 317.345 for point-of-purchase

materials, except as exempted under

§ 317.400. For all other products for

which nutrition labeling is required,

including ground or chopped meat

products described in § 317.301,

nutrition labeling must be provided in

accordance with the provisions of

§ 317.309, except as exempted under

§ 317.400.

(b) Nutrition labeling may be

provided for single-ingredient, raw meat

products that are not ground or chopped

meat products described in § 317.301

and that are not major cuts of singleingredient, raw meat products identified

in § 317.344, either in accordance with

the provisions of § 317.309 for nutrition

labels, or in accordance with the

provisions of § 317.345 for point-ofpurchase materials.

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4997

3. A new § 317.301 would be added

to read as follows:

§ 317.301 Required nutrition labeling of

ground or chopped meat products.

(a) Nutrition labels must be provided

for all ground or chopped products

(livestock species) and hamburger with

or without added seasonings (including,

but not limited to, ground beef, ground

beef patties, ground sirloin, ground

pork, and ground lamb) that are

intended for human consumption and

offered for sale, in accordance with the

provisions of § 317.309, except as

exempted under § 317.400.

4. Section 317.309 would be amended

as follows:

a. In paragraph (b)(3), the first

sentence would be amended by adding

‘‘that are not ground or chopped meat

products described in § 317.301’’ after

the phrase ‘‘single-ingredient, raw

products’’, and by removing ‘‘as set

forth in § 317.345(a)(1)’’; the second

sentence would be revised by adding,

‘‘that are not ground or chopped meat

products described in § 317.301’’ after

the phrase ‘‘single-ingredient, raw

products’’, and the following new

sentence would be added after the first

sentence:

* * * * *

(b) * * *

(3) * * * ‘‘For single-ingredient, raw

products that are not ground or chopped

meat products described in § 317.301, if

data are based on the product ‘‘as

consumed,’’ the data must be presented

in accordance with § 317.345(d). * * *

* * * * *

b. Paragraph (b)(10) would be

amended by adding the following new

sentence at the end of the paragraph:

* * * * *

(b) * * *

(10) * * * The declaration of the

number of servings per container need

not be included in nutrition labeling of

single-ingredient, raw meat products

that are not ground or chopped meat

products described in § 317.301,

including those that have been

previously frozen.

* * * * *

c. Paragraph (b)(11) would be

amended by adding the phrase ‘‘singleingredient, raw products that are not

ground or chopped meat products

described in § 317.301 and’’ after

‘‘exception of’’.

d. Paragraph (d)(3)(ii) would be

amended by removing the period and

adding ‘‘or on single-ingredient, raw

meat products that are not ground or

chopped meat products described in

§ 317.301.’’ at the end of the paragraph.

e. Paragraph (e)(3) would be amended

by adding ‘‘, but may be on the basis of

‘‘as consumed’’ for single-ingredient,

raw meat products that are not ground

or chopped meat products described in

§ 317.301,’’ after ‘‘as packaged’’.

f. Paragraph (h)(9) would be amended

by removing the phrase ‘‘(including

ground beef)’’ products’’, by adding,

‘‘that are not ground or chopped meat

products described in § 317.301’’ after

‘‘products’’, by removing the phrase,

‘‘its published form, the Agriculture

Handbook No. 8 series available from

the Government Printing Office’’, and by

adding, in its place, ‘‘its released form,

the USDA Nutrient Database for

Standard Reference’’, and by removing

the period and adding the following at

the end of the paragraph: ‘‘ as provided

in § 317.345(e) and (f).’’

5. Section 317.343 would be removed.

6. Section 317.344 would be amended

by removing the phrases ‘‘ground beef

regular without added seasonings,

ground beef about 17% fat,’’ and

‘‘ground pork.’’

7. Section 317.345 would be amended

as follows:

a. Paragraph (d) would be amended by

removing ‘‘should’’ and adding, in its

place, ‘‘for products covered in

paragraphs (a)(1) and (a)(2) must’’.

b. Paragraph (e) would be amended by

removing ‘‘its published form, the

Agriculture Handbook No. 8 series’’ and

by adding, in its place, ‘‘its released

form, the USDA Nutrient Database for

Standard Reference’’, and by removing

‘‘(including ground beef)’’.

c. Paragraph (f) would be amended by

adding ‘‘provided’’ after ‘‘nutrition

information is’’.

d. Paragraph (g) would be amended by

removing the phrase ‘‘(including ground

beef)’’.

e. The section heading and paragraphs

(a) and (c) would be revised to read as

follows:

§ 317.345 Nutrition labeling of singleingredient, raw meat products that are not

ground or chopped products described in

§ 317.301.

(a)(1) Nutrition information on the

major cuts of single-ingredient, raw

meat products identified in § 317.344,

including those that have been

previously frozen, is required, either on

their label or at their point-of-purchase,

unless exempted under § 317.400. If

nutrition information is presented on

the label, it must be provided in

accordance with § 317.309. If nutrition

information is presented at the point-ofpurchase, it must be provided in

accordance with the provisions of this

section.

(2) Nutrition information on singleingredient, raw meat products that are

not ground or chopped meat products

described in § 317.301 and are not major

cuts of single-ingredient, raw meat

products identified in § 317.344,

including those that have been

previously frozen, may be provided at

their point-of-purchase in accordance

with the provisions of this section or on

their label, in accordance with the

provisions of § 317.309.

(3) A retailer may provide nutrition

information at the point-of-purchase, by

various methods, such as by posting a

sign, or by making the information

readily available in brochures,

notebooks, or leaflet form in close

proximity to the food. The nutrition

labeling information may also be

supplemented by a video, live

demonstration, or other media. If a

nutrition claim is made on point-ofpurchase materials, all of the format and

content requirements of § 317.309

apply. However, if only nutrition

information—and not a nutrition

claim—is supplied on point-of-purchase

materials, the requirements of § 317.309

apply, provided, however:

(i) The listing of percent of Daily

Value for the nutrients (except vitamins

and minerals specified in § 317.309

(c)(8)) and footnote required by

§ 317.309(d)(9) may be omitted; and

(ii) The point-of-purchase materials

are not subject to any of the format

requirements.

* * * * *

(c) For the point-of-purchase

materials, the declaration of nutrition

information may be presented in a

simplified format as specified in

§ 317.309(f).

* * * * *

8. Section 317.362 would be amended

by adding a new paragraph (f) to read

as follows:

§ 317.362 Nutrient content claims for fat,

fatty acids, and cholesterol content.

* * * * *

(f) A statement of the lean percentage

may be used on the label or in labeling

of ground or chopped meat products

described in § 317.301 when the

product does not meet the criteria for

‘‘low fat,’’ defined in § 317.362(b)(2),

provided that a statement of the fat

percentage is contiguous to and in

lettering of the same color, size, type,

and on the same color background as

the statement of the lean percentage.

* * * * *

9. Section 317.400 would be amended

as follows:

a. Paragraph (a)(1), introductory text,

would be amended by removing the

comma and adding, at the end of the

paragraph, ‘‘, except that this exemption

does not apply to the major cuts of

4998 Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules

single-ingredient, raw products

identified in § 317.344,’’.

b. Paragraph (a)(1)(ii) would be

amended by adding ‘‘, including a single

retail store,’’ after the phrase ‘‘singleplant facility,’’ and by adding, ‘‘,

including a multi-retail store

operation,’’ after ‘‘company/firm’’.

c. Paragraph (a)(7)(i) would be

amended by removing the semi-colon

and by adding the following at the end

of the paragraph: ‘‘, provided, however,

that this exemption does not apply to

ready-to-eat ground or chopped meat

products described in § 317.301 that are

packaged or portioned at a retail

establishment, unless the establishment

qualifies for an exemption under

paragraph (a)(1) of this section;’’.

d. Paragraph (a)(7)(ii) would be

amended by removing the period and by

adding the following at the end of the

paragraph: ‘‘, provided, however, that

this exemption does not apply to multiingredient ground or chopped meat

products described in § 317.301 that are

processed at a retail establishment,

unless the establishment qualifies for an

exemption under paragraph (a)(1) of this

section.’’

e. Paragraph (d)(1) would be amended

by removing the period at the end of the

first sentence, and by adding the

following to the end of the first

sentence: ‘‘, except that this exemption

does not apply to the major cuts of

single-ingredient, raw meat products

identified in § 317.344.’’

PART 381—-POULTRY PRODUCTS

INSPECTION REGULATIONS

10. The authority citation for part 381

continues to read as follows:

Authority: 7 U.S.C. 138f, 450; 21 U.S.C.

451–470; 7 CFR 2.18, 2.53.

11. Section 381.400 would be revised

to read as follows:

§ 381.400 Nutrition labeling of poultry

products.

(a) Unless the product is exempted

under § 381.500, nutrition labeling must

be provided for all poultry products

intended for human consumption and

offered for sale, except singleingredient, raw products that are not

ground or chopped products described

in § 381.401 and are not major cuts of

single-ingredient, raw poultry products

identified in § 381.444. Nutrition

labeling must be provided for the major

cuts of single-ingredient, raw poultry

products identified in § 381.444, either

in accordance with the provisions of

§ 381.409 for nutrition labels, or in

accordance with the provisions of

§ 381.445 for point-of-purchase

materials, except as exempted under

§ 381.500. For all other products that

require nutrition labeling, including

ground or chopped poultry products

described in § 381.401, nutrition

labeling must be provided in accordance

with the provisions of § 381.409, except

as exempted under § 381.500.

(b) Nutrition labeling may be

provided for single-ingredient, raw

poultry products that are not ground or

chopped poultry products described in

§ 381.401 and that are not major cuts of

single-ingredient, raw poultry products

identified in § 381.444, either in

accordance with the provisions of

§ 381.409 for nutrition labels, or in

accordance with the provisions of

§ 381.445 for point-of-purchase

materials.

* * * * *

12. A new § 381.401 would be added

to read as follows:

§ 381.401 Required nutrition labeling of

ground or chopped poultry products.

Nutrition labels must be provided for

all ground or chopped poultry (kind)

with or without added seasonings

(including, but not limited to, ground

chicken, ground turkey, and (kind)

burgers) that are intended for human

consumption and offered for sale, in

accordance with the provisions of

§ 381.409, except as exempted under

§ 381.500.

* * * * *

13. Section 381.409 would be

amended as follows:

a. In paragraph (b)(3), the first

sentence would be amended by adding

‘‘that are not ground or chopped poultry

products described in § 381.401’’ after

the phrase ‘‘single-ingredient, raw

products’’ and by removing ‘‘as set forth

in § 381.445(a)(1)’’; the second sentence

would be amended by adding, ‘‘that are

not ground or chopped poultry products

described in § 381.401,’’ after the phrase

‘‘single-ingredient, raw products’’; and

the following new sentence would be

added after the first sentence:

* * * * *

(b) * * *

(3) * * * For single-ingredient, raw

products that are not ground or chopped

poultry products described in § 381.401,

if data are based on the product ‘‘as

consumed,’’ the data must be presented

in accordance with § 381.445(d).* * *

b. Paragraph (b)(10) would be

amended by adding the following new

sentence at the end of the paragraph:

* * * * *

(b) * * *

(10) * * * The declaration of the

number of servings per container need

not be included in nutrition labeling of

single-ingredient, raw poultry products

that are not ground or chopped poultry

products described in § 381.401,

including those that have been

previously frozen.

* * * * *

c. Paragraph (b)(11) would be

amended by adding the phrase ‘‘singleingredient, raw products that are not

ground or chopped poultry products

described in § 381.401 and’’ after

‘‘exception of’’.

d. Paragraph (d)(3)(ii) would be

amended by removing the period and

adding ‘‘or on single-ingredient, raw

poultry products that are not ground or

chopped poultry products described in

§ 381.401.’’ at the end of the paragraph.

e. Paragraph (e)(3) would be amended

by adding ‘‘, but may be on the basis of

‘‘as consumed’’ for single-ingredient,

raw poultry products that are not

ground or chopped poultry products

described in § 381.401,’’ after ‘‘as

packaged’’.

f. Paragraph (h)(9) would be amended

by adding, ‘‘that are not ground or

chopped poultry products described in

§ 381.401’’ after ‘‘products’’, by

removing the phrase, ‘‘its published

form, the Agriculture Handbook No. 8

series’’, and by adding, in its place, ‘‘its

released form, the USDA Nutrient

Database for Standard Reference’’, and

by removing the period and adding the

following at the end of the paragraph:

‘‘, as provided in § 381.445(e) and (f).’’

14. Section 381.443 would be

removed.

15. Section 381.445 would be

amended as follows:

a. Paragraph (d) would be amended by

removing ‘‘should’’ and adding, in its

place, ‘‘for products covered in

paragraphs (a)(1) and (a)(2) of this

section must’’.

b. Paragraph (e) would be amended by

removing ‘‘its published form, the

Agriculture Handbook No. 8 series’’ and

by adding, in its place, ‘‘its released

form, the USDA Nutrient Database for

Standard Reference.’’

c. Paragraph (f) would be amended by

adding ‘‘provided’’ after ‘‘nutrition

information is’’.

d. The section heading and paragraph,

(a) and (c) would be revised to read as

follows:

§ 381.445 Nutrition labeling of singleingredient, raw poultry products that are

not ground or chopped products described

in § 381.401.

(a)(1) Nutrition information on the

major cuts of single-ingredient, raw

poultry products identified in § 381.444,

including those that have been

previously frozen, is required, either on

their label or at their point-of-purchase,

unless exempted under § 381.500. If

Federal Register / Vol. 66, No. 12 / Thursday, January 18, 2001 / Proposed Rules 4999

nutrition information is presented on

the label, it must be provided in

accordance with the provisions of

§ 381.409. If nutrition information is

presented at the point-of-purchase, it

must be provided in accordance with

the provisions of this section.

(2) Nutrition information on singleingredient, raw poultry products that

are not ground or chopped poultry

products described in § 381.401 and are

not major cuts of single-ingredient, raw

poultry products identified in § 381.444,

including those that have been

previously frozen, may be provided at

their point-of-purchase in accordance

with the provisions of this section or on

their label, in accordance with the

provisions of § 381.409.

(3) A retailer may provide nutrition

information at the point-of-purchase, by

various methods, such as by posting a

sign, or by making the information

readily available in brochures,

notebooks, or leaflet form in close

proximity to the food. The nutrition

labeling information may also be

supplemented by a video, live

demonstration, or other media. If a

nutrition claim is made on point-ofpurchase materials, all of the format and

content requirements of § 381.409

apply. However, if only nutrition

information—and not a nutrition

claim—is supplied on point-of-purchase

materials, the requirements of § 381.409

apply, provided, however:

(i) The listing of percent of Daily

Value for the nutrients (except vitamins

and minerals specified in

§ 381.409(c)(8)) and footnote required by

§ 381.409(d)(9) may be omitted; and

(ii) The point-of-purchase materials

are not subject to any of the format

requirements.

* * * * *

(c) For the point-of-purchase

materials, the declaration of nutrition

information may be presented in a

simplified format as specified in

§ 381.409(f).

* * * * *

16. Section 381.462 would be

amended by adding a new paragraph (f)

to read as follows:

§ 381.462 Nutrient content claims for fat,

fatty acids, and cholesterol content.

* * * * *

(f) A statement of the lean percentage

may be used on the label or in labeling

of ground or chopped poultry products

described in § 381.401 when the

product does not meet the criteria for

‘‘low fat,’’ defined in § 381.462(b)(2),

provided that a statement of the fat

percentage is contiguous to and in

lettering of the same color, size, type,

and on the same color background as

the statement of the lean percentage.

* * * * *

17. Section 381.500 would be

amended as follows:

a. Paragraph (a)(1) would be amended

by removing the comma and adding, at

the end of the paragraph, ‘‘, except that

this exemption does not apply to the

major cuts of single-ingredient, raw

poultry products identified in § 381.444.

b. Paragraph (a)(1)(ii) would be

amended by adding, ‘‘, including a

single retail store,’’ after the phrase

‘‘single-plant facility,’’ and by adding ‘‘,

including a multi-retail store operation’’

after ‘‘company/firm’’.

c. Paragraph (a)(7)(i) would be

amended by removing the semi-colon

and adding the following at the end of

the paragraph: ‘‘provided, however, that

this exemption does not apply to readyto-eat ground or chopped poultry

products described in § 381.401 that are

packaged or portioned at a retail

establishment, unless the establishment

qualifies for an exemption under

paragraph (a)(1) of this section,’’ after

‘‘establishment’’.

d. Paragraph (a)(7)(ii) would be

amended by removing the period and

adding the following at the end of the

paragraph: ‘‘provided, however, that

this exemption does not apply to multiingredient ground or chopped poultry

products described in § 381.401 that are

processed at a retail establishment,

unless the establishment qualifies for an

exemption under paragraph (a)(1) of this

section.’’ after ‘‘establishment’’.

e. Paragraph (d)(1) would be amended

by removing the period at the end of the

sentence, and by adding the following to

the end of the sentence: ‘‘except that

this exemption does not apply to the

major cuts of single-ingredient, raw

poultry products identified in

§ 381.444.’’

Done in Washington, DC, on January 8,

2001.

Thomas J. Billy,

Administrator.

[FR Doc. 01–1119 Filed 1–17–01; 8:45 am]

BILLING CODE 3410–DM–P