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[Federal Register Volume 73, Number 104 (Thursday, May 29, 2008)]
[Rules and Regulations]
[Pages 30734-30736]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 08-1308]

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 28

[AMS-CN-07-0092; CN-08-001]
RIN 0581-AC80

User Fees for 2008 Crop Cotton Classification Services to Growers

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Agricultural Marketing Service (AMS) will raise the user 
fees for cotton producers for 2008 crop cotton classification services 
under the Cotton Statistics and Estimates Act. These user fees also are 
authorized under the Cotton Standards Act of 1923. The 2007 user fee 
for this classification service was $1.85 per bale. This rule will 
raise the fee for the 2008 crop to $2.00 per bale. This fee and the 
existing reserve are sufficient to cover the costs

[[Page 30735]]

of providing classification services, including costs for 
administration and supervision.

DATES: Effective July 1, 2008.

FOR FURTHER INFORMATION CONTACT: Darryl Earnest, Deputy Administrator, 
Cotton and Tobacco Programs, AMS, USDA, Room 2639-S, STOP 0224, 1400 
Independence Avenue, SW., Washington, DC 20250-0224. Telephone (202) 
720-2145, facsimile (202) 690-1718, or e-mail [email protected].

SUPPLEMENTARY INFORMATION: A proposed rule detailing the revisions was 
published in the Federal Register on April 17, 2008 (73 FR 20842). A 
15-day comment period was provided for interested persons to respond to 
the proposed rule. One comment was received from the National Cotton 
Council in support of the fee increase.

Executive Order 12866

    This rule has been determined to be not significant for purposes of 
Executive Order 12866; and, therefore has not been reviewed by the 
Office of Management and Budget (OMB).

Executive Order 12988

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. It 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. 
There are no administrative procedures that must be exhausted prior to 
any judicial challenge to the provisions of this rule.

Regulatory Flexibility Act

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612) AMS has considered the economic impact of 
this action on small entities and has determined that its 
implementation will not have a significant economic impact on a 
substantial number of small businesses.
    The purpose of the RFA is to fit regulatory actions to the scale of 
businesses subject to such actions so that small businesses will not be 
disproportionately burdened. There are an estimated 25,000 cotton 
growers in the U.S. who voluntarily use the AMS cotton classing 
services annually, and the majority of these cotton growers are small 
businesses under the criteria established by the Small Business 
Administration (13 CFR 121.201). The increase above the 2007 crop level 
as stated will not significantly affect small businesses as defined in 
the RFA because:
    (1) The fee represents a very small portion of the cost-per-unit 
currently borne by those entities utilizing the services. (The 2007 
user fee for classification services was $1.85 per bale; the fee for 
the 2008 crop would be increased to $2.00 per bale; the 2008 crop is 
estimated at 14,000,000 bales.)
    (2) The fee for services will not affect competition in the 
marketplace; and
    (3) The use of classification services is voluntary. For the 2007 
crop, 19,033,000 bales were produced; and, almost all of these bales 
were voluntarily submitted by growers for the classification service.
    (4) Based on the average price paid to growers for cotton from the 
2006 crop of 47.3 cents per pound, 500 pound bales of cotton are worth 
an average of $236.50 each. The proposed user fee increase for 
classification services, $2.00 per bale, is less than one percent of 
the value of an average bale of cotton.

Paperwork Reduction Act

    In compliance with OMB regulations (5 CFR part 1320), which 
implement the Paperwork Reduction Act (PRA) (44 U.S.C. 3501-3520), the 
information collection requirements contained in the provisions to be 
amended by this final rule have been previously approved by OMB and 
were assigned OMB control number 0581-AC80.

Fees for Classification Under the Cotton Statistics and Estimates Act 
of 1927

    The user fee charged to cotton producers for High Volume Instrument 
(HVI) classification services under the Cotton Statistics and Estimates 
Act (7 U.S.C. 473a) was $1.85 per bale during the 2007 harvest season 
as determined by using the formula provided in the Uniform Cotton 
Classing Fees Act of 1987, as amended by Public Law 102-237. The fees 
cover salaries, costs of equipment and supplies, and other overhead 
costs, including costs for administration and supervision. The fee 
structure for the 2007 crop year was incorporated under the authority 
of the Cotton Standards Act of 1923, by an interim final rule effective 
October 1, 2007 (72 FR 56242).
    This final rule establishes the user fee charged to producers for 
HVI classification at $2.00 per bale during the 2008 harvest season.
    The classification fees are based on the prevailing method of 
classification requested by producers during the previous year. HVI 
classing was the prevailing method of cotton classification requested 
by producers in 2007. Therefore, the 2008 producers' user fee for 
classification service is based on the 2007 base fee for HVI 
classification.
    The fee was calculated by applying the formula specified in the 
Uniform Cotton Classing Fees Act of 1987, as amended by Public Law 102-
237 which AMS also considers reasonable under the authority of the 
Cotton Standards Act of 1923. The 2007 base fee for HVI classification 
exclusive of adjustments, as provided by that Act, was $2.52 per bale. 
An increase of 3.06 percent, or 7 cents per bale, due to the implicit 
price deflator of the gross domestic product added to the $2.52 would 
result in a 2008 base fee of $2.59 per bale. The formula in the Act 
provides for the use of the percentage change in the implicit price 
deflator of the gross national product (as indexed for the most recent 
12-month period for which statistics are available). However, gross 
national product has been replaced by gross domestic product by the 
Department of Commerce as a more appropriate measure for the short-term 
monitoring and analysis of the U.S. economy.
    The number of bales to be classed by the United States Department 
of Agriculture from the 2008 crop is estimated at 14,000,000 bales. The 
2008 base fee was decreased 15 percent based on the estimated number of 
bales to be classed (1 percent for every 100,000 bales or portion 
thereof above the base of 12,500,000, limited to a maximum decreased 
adjustment of 15 percent). This percentage factor amounts to a 39 cents 
per bale reduction and was subtracted from the 2008 base fee of $2.59 
per bale, resulting in a fee of $2.20 per bale.
    However, with a fee of $2.20 per bale, the projected operating 
reserve would be 31.6 percent. The 1987 Act specifies that the 
Secretary shall not establish a fee which, when combined with other 
sources of revenue, will result in a projected operating reserve of 
more than 25 percent. Accordingly, the fee of $2.20 is reduced by 20 
cents per bale, to $2.00 per bale, to provide an ending accumulated 
operating reserve for the fiscal year of not more than 25 percent of 
the projected cost of operating the program. This will establish the 
2008 season fee at $2.00 per bale.
    Accordingly, Sec.  28.909, paragraph (b) will reflect the increase 
of the HVI classification fee to $2.00 per bale.
    A 5 cent per bale discount will continue to be applied to voluntary 
centralized billing and collecting agents as specified in Sec.  28.909 
(c).
    Growers or their designated agents receiving classification data 
will continue to incur no additional fees if classification data is 
requested only once. The fee for each additional retrieval of 
classification data in Sec.  28.910 would remain at 5 cents per

[[Page 30736]]

bale. The fee in Sec.  28.910 (b) for an owner receiving classification 
data from the National database would remain at 5 cents per bale, and 
the minimum charge of $5.00 for services provided per monthly billing 
period would remain the same. The provisions of Sec.  28.910 (c) 
concerning the fee for new classification memoranda issued from the 
National database for the business convenience of an owner without 
reclassification of the cotton will remain the same at 15 cents per 
bale or a minimum of $5.00 per sheet.
    The fee for review classification in Sec.  28.911 will increase to 
$2.00 per bale.
    The fee for returning samples after classification in Sec.  28.911 
would remain at 40 cents per sample. This fee was incorrectly referred 
to in the proposed rule as 50 cents per sample.

List of Subjects in 7 CFR Part 28

    Administrative practice and procedure, Cotton, Cotton samples, 
Grades, Market news, Reporting and recordkeeping requirements, 
Standards, Staples, Testing, Warehouses.

0
For the reasons set forth in the preamble, 7 CFR part 28 is amended to 
read as follows:

PART 28--[AMENDED]

0
1. The authority citation for 7 CFR part 28, subpart D, continues to 
read as follows:

    Authority: 7 U.S.C. 51-65; 7 U.S.C. 471-476.

0
2. In Sec.  28.909, paragraph (b) is revised to read as follows:

Sec.  28.909  Costs.

* * * * *
    (b) The cost of High Volume Instrument (HVI) cotton classification 
service to producers is $2.00 per bale.
* * * * *

0
3. In Sec.  28.911, the last sentence of paragraph (a) is revised to 
read as follows:

Sec.  28.911  Review classification.

    (a) * * * The fee for review classification is $2.00 per bale.
* * * * *

    Dated: May 27, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 08-1308 Filed 5-27-08; 1:29 pm]
BILLING CODE 3410-02-P
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