This section of the FEDERAL REGISTER

contains regulatory documents having general

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REGISTER issue of each week.

Rules and Regulations Federal Register

62055 

Vol. 70, No. 208 

Friday, October 28, 2005 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 983 

[Docket No. FV05–983–4 FIR] 

Pistachios Grown in California; 

Establishment of Procedures for 

Exempting Handlers From Minimum 

Quality Testing 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: The Department of 

Agriculture (USDA) is adopting, as a 

final rule, without change, an interim 

final rule that established procedures for 

exempting handlers from quality 

requirements, including maximum 

limits for quality defects and minimum 

size, prescribed under the California 

pistachio marketing order (order). The 

order regulates the handling of 

pistachios grown in California and is 

administered locally by the 

Administrative Committee for 

Pistachios (committee). These 

procedures will be used by the 

committee in considering handler 

requests for exemptions from minimum 

quality testing requirements and when 

considering revocations of such 

exemptions. Additionally, this final rule 

continues in effect the establishment of 

an appeals process for handlers who 

have been denied an exemption or had 

an approved exemption revoked. 

EFFECTIVE DATE: November 28, 2005. 

FOR FURTHER INFORMATION CONTACT: 

Terry Vawter, California Marketing 

Field Office, Marketing Order 

Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA; 

Telephone: (559) 487–5901, Fax: (559) 

487–5906; or George Kelhart, Technical 

Advisor, Marketing Order 

Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA, 1400 

Independence Avenue SW., STOP 0237, 

Washington, DC 20250–0237; 

Telephone: (202) 720–2491, Fax: (202) 

720–8938. 

Small businesses may request 

information on complying with this 

regulation by contacting Jay Guerber, 

Marketing Order Administration 

Branch, Fruit and Vegetable Programs, 

AMS, USDA, 1400 Independence 

Avenue SW., STOP 0237, Washington, 

DC 20250–0237; Telephone: (202) 720– 

2491, Fax: (202) 720–8938, or E-mail: 

Jay.Guerber@usda.gov. 

SUPPLEMENTARY INFORMATION: This rule 

is issued under Marketing Order No. 

983 (7 CFR part 983), regulating the 

handling of pistachios grown in 

California, hereinafter referred to as the 

‘‘order.’’ The order is effective under the 

Agricultural Marketing Agreement Act 

of 1937, as amended (7 U.S.C. 601–674), 

hereinafter referred to as the ‘‘Act.’’ 

The Department of Agriculture 

(USDA) is issuing this rule in 

conformance with Executive Order 

12866. 

This rule has been reviewed under 

Executive Order 12988, Civil Justice 

Reform. This rule is not intended to 

have retroactive effect. This rule will 

not preempt any State or local laws, 

regulations, or policies, unless they 

present an irreconcilable conflict with 

this rule. 

The Act provides that administrative 

proceedings must be exhausted before 

parties may file suit in court. Under 

section 608c(15)(A) of the Act, any 

handler subject to an order may file 

with USDA a petition stating that the 

order, any provision of the order, or any 

obligation imposed in connection with 

the order is not in accordance with law 

and request a modification of the order 

or to be exempted therefrom. A handler 

is afforded the opportunity for a hearing 

on the petition. After the hearing USDA 

would rule on the petition. The Act 

provides that the district court of the 

United States in any district in which 

the handler is an inhabitant, or has his 

or her principal place of business, has 

jurisdiction to review USDA’s ruling on 

the petition, provided an action is filed 

not later than 20 days after the date of 

the entry of the ruling. 

This rule continues in effect the 

establishment of procedures for use by 

the committee in exempting handlers 

from minimum quality (maximum 

limits for quality defects and minimum 

size) testing requirements prescribed 

under the order. The committee, or its 

duly authorized agents, will also use 

these procedures when considering the 

revocation of exemptions for good 

cause, and when considering appeals of 

handlers who have had exemptions 

denied or revoked. 

Section 983.46 of the pistachio order 

authorizes the committee to recommend 

that the Secretary modify or suspend the 

order provisions contained in §§ 983.38 

through 983.45. These sections were 

implemented on August 1, 2005. 

Section 983.41 of the pistachio order 

authorizes exemptions from minimum 

quality testing requirements for 

handlers handling less than 1 million 

pounds of assessed weight pistachios 

per production year (September 1– 

August 31) and specifies that the 

committee may grant handler 

exemptions. For the purposes, of this 

document, the term ‘‘production year’’ 

is synonymous with ‘‘marketing year’’. 

Section 983.70 of the pistachio order 

exempts handlers who handle 1,000 

pounds or less of dried weight (assessed 

weight) pistachios (dried to 5 percent 

moisture) during any marketing year 

from all assessment, aflatoxin, and 

minimum quality requirements. 

Section 983.147 of the pistachio order 

establishes handler reporting 

requirements (ACP Forms 2–7) and 

exempts handlers who handle 1,000 

pounds or less of dried weight 

pistachios from all reporting 

requirements with the exception of ACP 

Form–4. Handlers who have handled or 

intend to handle 1,000 pounds or less of 

dried weight pistachios during the 

production year (September 1–August 

31) must submit ACP Form–4 by 

November 15 each year to the 

committee. 

The recommended decision, 

published on August 4, 2003, (68 FR 

45990), indicated that implementing 

regulations would effectuate the 

declared policy of the Act by 

establishing the specific procedures for 

exempting handlers who handle more 

than 1,000 pounds and less than 1 

million pounds of assessed weight 

pistachios per production year 

(September 1–August 31) from 

minimum quality testing requirements. 

Under these authorities, the 

committee at its April 12, 2005, 

meeting, unanimously recommended 

establishing a new section entitled, 

62056 Federal Register / Vol. 70, No. 208 / Friday, October 28, 2005 / Rules and Regulations 

‘‘§ 983.141—Procedures for Exempting 

Handlers from Minimum Quality 

Testing’’ to specify appropriate 

exemption, revocation, and appeal 

procedures. The committee believes that 

standardized procedures would ensure 

equitable treatment of applicants for 

exemptions and those handlers subject 

to the revocation of such exemptions. 

The committee also recommended 

that handler exemptions under 

§ 983.41(b) not be granted if a handler 

failed to file required reports, shipped 

substandard pistachios, or failed to 

comply with the requirements specified 

in § 983.41 on exemptions for minimum 

quality testing. Revocation of approved 

exemptions could be implemented by 

the committee, or its duly authorized 

agents, for the same reasons. 

Additionally, the committee 

recommended that any handler who 

believes that he/she has been 

improperly denied an exemption or 

improperly had an exemption revoked 

by the committee should be allowed to 

appeal the committee’s action to USDA. 

The committee recommended that the 

USDA review any appeals and 

determine their merit. All appeals must 

be submitted in writing, and the 

committee will provide USDA the 

complete file on each appeal. 

The recommended exemption 

procedures require the committee, or its 

duly authorized agents, to timely notify 

all handlers of the opportunity to apply 

to be exempted from minimum quality 

testing so that all interested handlers 

can submit applications on forms 

provided by the committee by the 

August 1 deadline; promptly review all 

requests for exemption; verify that the 

quantity of assessed weight pistachios 

handled by any applicants during the 

prior production year was less than 1 

million pounds of assessed weight and 

that applicants are in compliance with 

the order’s inspection, quality, and 

reporting requirements; approve or 

disapprove requests for exemptions by 

August 20 of each year; maintain 

complete files concerning the approval 

or disapproval of each handler’s 

application; and notify handlers by 

August 30 of approval or disapproval. 

A handler’s exemption would be 

revoked by the committee, or its duly 

authorized agents, if the handler fails to 

provide reports required under this part, 

or has not complied with the provisions 

on minimal quantity testing in § 983.41. 

Additionally, the committee, or its duly 

authorized agents, would revoke an 

approved exemption when a handler 

audit reveals that a handler has handled 

a million pounds or more of assessed 

weight pistachios during the applicable 

production year. The revocation of a 

handler’s exemption would be made in 

writing to the handler and specify the 

reason(s) for and the effective date of the 

revocation. 

Any handler who believes that he/she 

has been improperly denied an 

exemption or improperly had an 

exemption revoked may appeal to 

USDA for reconsideration within 20 

days after notification of the 

committee’s findings. All appeals must 

be in writing. 

The committee, or its duly authorized 

agents, shall forward all pertinent 

information related to the handler’s 

appeal to USDA. USDA shall inform the 

handler and all interested persons of the 

Secretary’s decision. 

As previously mentioned, under 

§ 983.70 of the order, this rule continues 

in effect the application to handlers 

handling more than 1,000 pounds and 

less than 1 million pounds because 

handlers who handle 1,000 pounds or 

less of dried weight pistachios are 

exempt from assessment, aflatoxin, and 

minimum quality requirements and 

from all reporting requirements under 

§ 983.147 of the order’s administrative 

rules and regulations, with the 

exception of filing ACP Form–4. 

Final Regulatory Flexibility Analysis 

Pursuant to requirements set forth in 

the Regulatory Flexibility Act (RFA), the 

Agricultural Marketing Service (AMS) 

has considered the economic impact of 

this action on small entities. 

Accordingly, AMS has prepared this 

final regulatory flexibility analysis. 

The purpose of the RFA is to fit 

regulatory actions to the scale of 

business subject to such actions in order 

that small businesses will not be unduly 

or disproportionately burdened. 

Marketing orders issued pursuant to the 

Act, and the rules issued thereunder, are 

unique in that they are brought about 

through group action of essentially 

small entities acting on their own 

behalf. Thus, both statutes have small 

entity orientation and compatibility. 

There are approximately 24 handlers 

of California pistachios who are subject 

to regulation under the order and about 

741 producers of pistachios in the 

production area. The Small Business 

Administration (SBA) (13 CFR 121.20) 

defines small agricultural service firms 

as those having annual receipts of less 

than $6,000,000, and small agricultural 

producers are defined as those having 

annual receipts of less than $750,000. 

Seventeen of the 24 handlers subject to 

regulation have annual pistachio 

receipts of less than $6,000,000. In 

addition, 722 of the 741 producers have 

annual receipts less than $750,000. 

Therefore, a majority of handlers and 

producers may be classified as small 

entities under the SBA standards. 

This rule continues in effect the 

establishment of procedures for 

exempting handlers from minimum 

quality (maximum limits for quality 

defects and minimum size) testing 

requirements prescribed under the 

order. These procedures will be used by 

the committee when considering 

handler requests for exemptions from 

minimum quality testing requirements 

and when considering revocations of 

such exemptions. Additionally, this rule 

continues in effect the establishment of 

an appeals process for handlers who 

have been denied an exemption or had 

an exemption revoked. 

Section 983.41(a) of the pistachio 

order permits handlers who handle less 

than 1 million pounds of assessed 

weight pistachios each production year 

(September 1–August 31) to use 

optional aflatoxin testing methods. The 

optional methods permit the sampling 

and testing of a handler’s entire 

inventory before further processing, and 

allow handlers to segregate their 

receipts into various lots for sampling 

and testing. 

Section 983.41(b) of the pistachio 

order authorizes handler exemptions 

from minimum quality testing for 

handlers who handle less than 1 million 

pounds of assessed weight pistachios 

per production year, and specifies that 

the committee may grant such handler 

exemptions. 

Section 983.70 of the pistachio order 

exempts handlers who handle 1,000 

pounds or less of dried weight (assessed 

weight) pistachios (dried to 5 percent 

moisture) during any marketing year 

from all assessment, aflatoxin, and 

minimum quality requirements. For the 

purposes of this document, the term 

‘‘marketing year’’ is synonymous with 

‘‘production year’’ and represents the 

period September 1 through August 31. 

The recommended decision, 

published on August 4, 2003, (68 FR 

45990), indicated that implementing 

regulations would effectuate the 

declared policy of the Act by 

establishing the specific procedures for 

exempting handlers who handle more 

than 1,000 pounds and less than 1 

million pounds of assessed weight 

pistachios per production year 

(September 1–August 31) from 

minimum quality testing requirements. 

Under these authorities, the 

committee at its April 12, 2005, 

meeting, unanimously recommended 

establishing standardized procedures for 

granting and revoking handler 

exemption requests, and considering 

handler appeals on exemption 

decisions. This action will have a 

Federal Register / Vol. 70, No. 208 / Friday, October 28, 2005 / Rules and Regulations 62057 

positive impact on small and large 

handlers by assuring that all exemption 

applications and reviews are handled 

equitably following approved 

standardized procedures. 

The committee discussed alternatives 

to this change, including not making 

any changes, but determined that 

specific procedures were needed to 

facilitate: (1) Exempting handlers from 

minimum quality testing; (2) revoking 

exemptions when handlers violate 

requirements under the marketing order; 

and (3) processing appeals to the 

committee’s actions. These procedures 

are expected to ensure that all such 

requests are treated equitably. The 

committee’s vote was unanimous. 

The information collection 

requirements for the ACP Form–5, 

which handlers will complete and 

forward to the committee to request 

exemption from minimum quality 

requirements under the order, was 

previously submitted to the Office of 

Management and Budget (OMB) and 

approved under OMB No. 0581–0230. 

Thus, this action will not impose any 

additional reporting or recordkeeping 

requirements on either small or large 

pistachio handlers. As with all Federal 

marketing order programs, reports and 

forms are periodically reviewed to 

reduce information requirements and 

duplication by industry and public 

sector agencies. In addition, USDA has 

not identified any relevant Federal rules 

that duplicate, overlap or conflict with 

this rule. 

The AMS is committed to compliance 

with the Government Paperwork 

Elimination Act, which requires 

government agencies in general to 

provide the public the option of 

submitting information or transacting 

business electronically to the maximum 

extent possible. 

Further, the committee’s meetings are 

widely publicized throughout the 

pistachio industry and all interested 

persons are encouraged to attend the 

meetings and participate in the 

committee’s deliberations. Like all 

committee meetings, the April 12, 2005, 

meeting was a public meeting and all 

entities, both large and small, were 

encouraged to express their views on 

these issues. 

An interim final rule concerning this 

action was published in the Federal 

Register on July 22, 2005 (70 FR 42256). 

Copies of the rule were provided to the 

committee and handlers by the 

committee staff. In addition, the rule 

was made available through the Internet 

by USDA and the Office of the Federal 

Register. That rule provided for a 60-day 

comment period, which ended 

September 20, 2005. No comments were 

received. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

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

fv/moab.html. Any questions about the 

compliance guide should be sent to Jay 

Guerber at the previously mentioned 

address in the FOR FURTHER INFORMATION

CONTACT section. 

After consideration of all relevant 

material presented, including the 

committee’s recommendation and other 

information, it is found that this 

finalizing the interim final rule, without 

change, as published in the Federal 

Register (70 FR 42256, July 22, 2005), 

will tend to effectuate the declared 

policy of the Act. 

List of Subjects in 7 CFR Part 983 

Pistachios, Marketing agreements and 

orders, Reporting and recordkeeping 

requirements. 

PART 983—PISTACHIOS GROWN IN 

CALIFORNIA 

■ Accordingly, the interim final rule 

amending 7 CFR part 983, which was 

published at 70 FR 42256 on July 22, 

2005, is adopted as a final rule without 

change. 

Dated: October 24, 2005. 

Lloyd C. Day, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 05–21489 Filed 10–27–05; 8:45 am] 

BILLING CODE 3410–02–P 

FEDERAL DEPOSIT INSURANCE 

CORPORATION 

12 CFR Part 330 

RIN 3064–AC90 

Deposit Insurance Coverage; Accounts 

of Qualified Tuition Savings Programs 

Under Section 529 of the Internal 

Revenue Code 

AGENCY: Federal Deposit Insurance 

Corporation (FDIC). 

ACTION: Final rule. 

SUMMARY: The FDIC is adopting a final 

rule governing the insurance coverage of 

deposits of qualified tuition savings 

programs under section 529 of the 

Internal Revenue Code. The final rule 

makes no substantive changes to a 

previous interim final rule. Under the 

rule, the deposits of a qualified tuition 

savings program will be insured on a 

‘‘pass-through’’ basis to the program 

participants. In other words, the 

deposits will be insured up to $100,000 

for the interest of each participant in 

aggregation with the participant’s other 

deposits (if any) at the same insured 

depository institution. 

DATES: The final rule will be effective on 

December 27, 2005. 

FOR FURTHER INFORMATION CONTACT: 

Christopher L. Hencke, Counsel, Legal 

Division, (202) 898–8839, Federal 

Deposit Insurance Corporation, 550 17th 

Street, NW., Washington, DC 20429. 

SUPPLEMENTARY INFORMATION: 

I. Qualified Tuition Programs 

Section 529 of the Internal Revenue 

Code provides tax benefits for ‘‘qualified 

tuition programs.’’ See 26 U.S.C. 529(a). 

Such programs include prepaid tuition 

programs (which may be created by 

states or educational institutions) as 

well as tuition savings programs (which 

must be sponsored by states or public 

instrumentalities). See 26 U.S.C. 

529(b)(1). A tuition savings program is 

defined by section 529 as a program 

under which a person ‘‘may make 

contributions to an account which is 

established for the purpose of meeting 

the qualified higher education expenses 

of the designated beneficiary of the 

account’’ (and which meets certain 

requirements). 26 U.S.C. 529(b)(1)(A)(ii). 

Under laws administered by the 

Securities and Exchange Commission 

(SEC), interests in a qualified tuition 

savings program must be sold by a 

public instrumentality (such as a state 

investment trust) so that the interests in 

the program will be exempt from 

registration under section 2(b) of the 

Investment Company Act. See 15 U.S.C. 

80a–2(b). This means that a participant 

in a state qualified tuition savings 

program cannot acquire an asset through 

the program or public instrumentality. 

Rather, the participant must acquire an 

interest or account in the public 

instrumentality. 

Some state 529 programs have 

provided participants with the option of 

investing their funds directly in bank 

deposits. Other state programs have 

expressed an interest in creating such an 

option. As stated above, participants in 

a 529 program must acquire an interest 

in the public instrumentality. They 

cannot acquire a particular asset. This 

means that the public instrumentality, 

not the participant, will be the legal 

owner of any bank deposit purchased by 

or through the public instrumentality. 

The fact that any bank deposit will 

belong to the public instrumentality 

raises issues under the FDIC’s insurance 

regulations. These issues are discussed 

below.