19160 Federal Register / Vol. 61, No. 85 / Wednesday, May 1, 1996 / Rules and Regulations

PART 273—CERTIFICATION OF

ELIGIBLE HOUSEHOLDS

§ 273.9 [Amended]

3. In § 273.9, the second sentence of

paragraph (b)(5)(i) is amended by

removing the words ‘‘for purposes of

recouping from a household an

overpayment which resulted from the

household’s intentional failure to

comply with the other program’s

requirements’’.

4. In § 273.11, paragraph (k) is revised

to read as follows:

§ 273.11 Action on households with

special circumstances.

* * * * *

(k) Failure to comply with another

assistance program’s requirements. A

State agency shall not increase food

stamp benefits when a household’s

benefits received under another meanstested Federal, State or local welfare or

public assistance program, which is

governed by welfare or public assistance

laws or regulations and which

distributes public funds, have been

decreased (reduced, suspended or

terminated) due to an intentional failure

to comply with a requirement of the

program that imposed the benefit

decrease. This provision does not apply

in the case of individuals or households

subject to a food stamp work sanction

imposed pursuant to 7 CFR 273.7(g)(2).

State agency procedures shall adhere to

the following minimum conditions:

(1) This provision must be applied to

all applicable cases. If a State agency is

not successful in obtaining the

necessary cooperation from another

Federal, State or local means-tested

welfare or public assistance program to

enable it to comply with the

requirements of this provision, the State

agency shall not be held responsible for

noncompliance as long as the State

agency has made a good faith effort to

obtain the information.

(2) A State agency shall not reduce,

suspend or terminate a household’s

current food stamp allotment amount

when the household’s benefits under

another applicable assistance program

have been decreased due to an

intentional failure to comply with a

requirement of that program.

(3) A State agency must adjust food

stamp benefits when eligible members

are added to the food stamp household

regardless of whether or not the

household is prohibited from receiving

benefits for the additional member

under another Federal, State or local

welfare or public assistance meanstested program.

(4) Changes in household

circumstances which are not related to

a penalty imposed by another Federal,

State or local welfare or public

assistance means-tested program shall

not be affected by this provision.

Dated: April 23, 1996.

Ellen Haas,

Under Secretary for Food, Nutrition, and

Consumer Services.

[FR Doc. 96–10786 Filed 4–30–96; 8:45 am]

BILLING CODE 3410–30–U

Agricultural Marketing Service

7 CFR Parts 916 and 917

[Docket No. FV95–916–5FR]

Nectarines and Peaches Grown in

California; Relaxation of Quality

Requirements for Fresh Nectarines

and Peaches

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Final rule.

SUMMARY: This final rule relaxes, for the

1996 season only, the quality

requirements for California nectarines

and peaches. This rule establishes a

‘‘CA Utility’’ quality requirement, based

on minimum quality standards

established under the California

Agricultural Code, with a limitation on

the amount of fruit meeting U.S. No. 1

or higher grade requirements that may

be contained in the utility pack. This

final rule also requires that containers of

nectarines and peaches meeting the ‘‘CA

Utility’’ quality requirement be clearly

marked ‘‘CA Utility.’’ This final rule

will allow more nectarines and peaches

into fresh market channels, and is

designed to benefit growers and

consumers.

EFFECTIVE DATE: This final rule becomes

effective May 2, 1996.

FOR FURTHER INFORMATION CONTACT:

Kenneth Johnson, Marketing Specialist,

Marketing Order Administration

Branch, Fruit and Vegetable Division,

AMS, USDA, P.O. Box 96456, Room

2523–S, Washington, DC 20090–6456;

telephone: (202) 720–2861; or Terry

Vawter, Marketing Specialist, California

Marketing Field Office, Marketing Order

Administration Branch, Fruit and

Vegetable Division, AMS, USDA, 2202

Monterey Street, Suite 102B, Fresno,

California, 93721; telephone: (209) 487–

5901.

SUPPLEMENTARY INFORMATION: This final

rule is issued under Marketing

Agreement and Marketing Order Nos.

916 and 917 [7 CFR Parts 916 and 917]

regulating the handling of nectarines

and peaches grown in California,

respectively, hereinafter referred to as

the orders. The orders are 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

(Department) is issuing this final rule in

conformance with Executive Order

12866.

This final rule has been reviewed

under Executive Order 12778, Civil

Justice Reform. This final rule is not

intended to have retroactive effect. This

final 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 the Secretary 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 the Secretary 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 the Secretary’s ruling on the

petition, provided an action is filed not

later than 20 days after the date of the

entry of the ruling.

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. 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

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 about 300 California

nectarine and peach handlers subject to

regulation under the orders covering

nectarines and peaches grown in

California, and about 1,800 producers of

these fruits in California. Small

agricultural producers have been

defined by the Small Business

Administration [13 CFR 121.601] as

those having annual receipts of less than

$500,000, and small agricultural service

firms are defined as those whose annual
Federal Register / Vol. 61, No. 85 / Wednesday, May 1, 1996 / Rules and Regulations 19161

receipts are less than $5,000,000. A

majority of these handlers and

producers may be classified as small

entities.

This final rule establishes, for the

1996 season only, a ‘‘CA Utility’’ quality

requirement and a container marking

requirement for shipments of ‘‘CA

Utility’’ fruit.

Minimum grade requirements for

fresh nectarines and peaches grown in

California are in effect under § 916.356

and § 917.459, respectively. This rule

amends §§ 916.356 and 917.459 by

revising paragraph (a)(1) under each

section to permit shipments of fruit

meeting ‘‘CA Utility’’ quality

requirements. ‘‘CA Utility’’ quality

requirements are the same as the

requirements set forth in the California

Agricultural Code for nectarines and

peaches with the exception that not

more than 30 percent of the fruit in a

container may meet or exceed the

requirements of the U.S. No. 1 Grade

Standard. ‘‘CA Utility’’ fruit must be

inspected by the Federal or FederalState Inspection Service and certified as

meeting the ‘‘CA Utility’’ quality

requirements. ‘‘CA Utility’’ fruit are

subject to assessment, maturity, size and

all other requirements of the orders.

This rule also amends §§ 916.350 and

917.442 by adding a paragraph to each

section to specify that each package or

container of nectarines and peaches

shipped, meeting the requirements of

the newly established ‘‘CA Utility’’

quality, must be conspicuously marked

with the words ‘‘CA Utility’’ on a visible

display panel.

Shipments of California nectarines

and peaches are subject to minimum

grade, size, and maturity requirements

under the provisions of Marketing

Orders 916 (section 916.356) during the

period April 1 through October 31 each

year and 917 (section 917.459) during

the period April 1 through November 23

each year. Currently, nectarine

shipments are required to meet the

requirements of U.S. No. 1 Grade,

except less scarring is permitted than

under the U.S. No. 1 Grade, and the

tolerance for fruit that is not well

formed is greater than the U.S. No. 1

Grade. Different minimum size

requirements are in effect for different

groupings of nectarine varieties.

Peach shipments are currently

required to meet the requirements of

U.S. No. 1 Grade, except there is an

additional tolerance for fruit damage

caused by open sutures. Also, different

minimum size requirements are in effect

for different groupings of peach

varieties.

Both the nectarine and peach

regulations allow the shipment of fruit

one size smaller than the specified

minimum if the fruit meets higher

maturity requirements. Both nectarine

and peach shipments are also subject to

container, pack, and container marking

requirements.

Prior to the 1995 shipping season, the

Nectarine Administrative and Peach

Commodity Committees (Committees),

the agencies responsible for local

administration of the orders, considered

recommending a change in the nectarine

and peach regulations to allow a utility

grade for these fruits. (Utility grade is a

lower quality fruit than U.S. No. 1.)

During the 1995 season, changes were

made to allow the shipment of a utility

grade for California plums, which are

regulated under a State program. The

plum utility grade was based on

California Agricultural Code

requirements. The Committees voted

not to recommend a utility grade for

nectarines and peaches for the 1995

season. The Committees did, however,

hire Dr. Dennis Nef, California State

University, Fresno, to conduct a

research project to study the potential

impact of a utility grade for nectarines

and peaches. The Committees also

believed that industry experience with

the plum utility grade would be helpful

in making future recommendations for

appropriate quality requirements for

nectarines and peaches. The report

prepared by Dr. Nef was presented to

the Nectarine and Peach Grade and Size

Subcommittees in October 1995. The

report found that about 22 percent of the

peaches sampled in packinghouse cull

bins in 1995 would have met California

Agricultural Code requirements. Of the

nectarines sampled from packinghouse

culls in that year, about 6 percent would

have met California Agricultural Code

requirements, and an additional 14

percent failed marketing order quality

requirements but met U.S. No. 1 Grade

requirements (as indicated previously,

the nectarine requirements under the

order permit less fruit scarring than

allowed under the U.S. No. 1 Grade).

The report pointed out that these

findings were based on a season which

was marked by unusual crop and

weather conditions. After reviewing the

report, the nectarine and peach

subcommittees voted not to recommend

to the full Committees that a utility

grade be implemented in 1996 for

nectarines and peaches, citing the

unusual weather conditions that

resulted in below normal crop

production. They believed that Dr. Nef’s

research project should be continued for

another year to allow for the collection

of data based on a more typical season.

On November 29, 1995, the

Department wrote to the Committees,

recommending that a utility grade be

adopted for nectarines and peaches for

the 1996 season beginning April 1,

1996. The Committees met on December

6–7, 1995, to discuss possible

implementation of a utility grade for

nectarines and peaches for the 1996

season. Committee members and others

in attendance at the meetings expressed

views in opposition to and in support of

implementing a utility grade.

Commentors in opposition to a utility

grade for nectarines and peaches stated

that the 1995 season was not a normal

season for plums, nectarines, or peaches

and should not be used as a basis for

recommending a utility grade. They also

said that the tree fruit industry is facing

competition in both domestic and in

foreign markets. One commentor stated

that utility grade fruit would damage the

reputation of California-produced tree

fruit and another stated that poor

quality California plums had been

shipped to Hong Kong during the 1995

season, and that these plums had

damaged the overall reputation of

California plums. One commentor stated

that allowing a utility grade would

result in inspections of fruit which

would only serve to verify that the fruit

in the container is poor quality. Others

stated that lower quality fruit is not

wasted and may be used for cattle feed.

Another stated that the results of the

recent grower referendum indicated

support for the continuation of the

program and the continuation of current

quality standards.

One commentor in support of a utility

grade for nectarines stated that the

implementation of a utility grade for

plums in 1995 resulted in a $10 million

increase in plum grower revenue.

Commentors noted that less than 10

percent of the plum pack was utility

grade. One commentor stated that while

less than one percent of his

organization’s plum pack was utility

grade, this lower grade should be

available for use by nectarine and peach

handlers if a market exists. Others

commented that the Department had

recommended a utility grade for

nectarines and peaches for one year

only—1996.

Committee members and others who

commented at the December 1995

Committee meetings indicated that a

niche market may exist for utility grade

fruit and that the opportunity should be

made available to market lower quality

fruit to meet demand. Reducing quality

requirements would allow more fruit to

be marketed. The lower quality fruit

would be made available at lower

prices, which would especially benefit

lower income consumers.
19162 Federal Register / Vol. 61, No. 85 / Wednesday, May 1, 1996 / Rules and Regulations

Data on recent production of

California nectarines and peaches in

relation to season average producer

prices appear to indicate that lesser

quality fruit could be marketed

successfully without interfering with

sales of higher quality fruit. The limited

additional quantity expected to be made

available would be expected to have a

minimal effect on consumer purchases

and season average producer prices for

California nectarines and peaches. Sales

of lesser quality fruit to a niche market

could increase producer revenue and

promote consumer satisfaction.

The implementation of utility quality

requirements for the 1996 season would

authorize fruit meeting these

requirements to be shipped to market

and would provide information on

consumer and retailer acceptance of

such fruit. This information could then

be used to supplement information

collected by Dr. Nef and assist the

Committees in developing appropriate

quality requirements for the 1997

season.

Based on the foregoing, the

Department proposed that a utility grade

for nectarines and peaches be

implemented on a temporary basis for

the 1996 season. The Department

proposed, for purposes of this

regulation, to define ‘‘CTFA Utility’’ to

mean fruit which meets the

requirements of the U.S. No. 2 Grade

defined in the United States Standards

for Grades of Nectarines (7 CFR 51.3145

through 51.3160) and the United States

Standards for Grades of Peaches (7 CFR

51.1210 through 51.1223), except that

misshapened fruit and fruit with serious

damage due to scarring would be

permitted.

In order to prevent confusion in the

marketplace and to clearly differentiate

shipments of ‘‘CTFA Utility’’ fruit from

better quality fruit, the Department

proposed requiring containers of ‘‘CTFA

Utility’’ fruit to be conspicuously

marked with the words ‘‘CTFA Utility’’.

In addition, it was proposed that

shipments of such fruit continue to be

required to meet the same container,

pack, and container marking

requirements in effect for shipments of

higher quality fruit.

A proposed rule concerning this

action was published in the March 4,

1996, Federal Register (61 FR 8225),

with a 30-day comment period ending

on April 3, 1996. Nine comments were

received. Jonathan Field, Manager of the

California Tree Fruit Agreement, and

John Tos, Chairman of the Peach

Commodity Committee, submitted

comments on behalf of the Committees,

recommending modifications to the

proposed rule as published. Six other

commentors supported the

establishment of a utility quality

requirement, but did not fully agree

with the Committees’ comments: Harry

Snyder, Consumers Union of U.S., Inc;

Joe Caram, nectarine grower, Reedley,

California; Steven Booz, Reedley,

California; Richard Mittry, tree fruit

grower, Sultana, California; Dan

Gerawan, tree fruit grower-shipper,

Reedley, California; and Craig

Rasmussen, a grower and packer of

California tree fruit, Reedley, California.

One comment received from Leroy

Giannini, a grower-handler of California

tree fruit, Dinuba, California, opposes

the establishment of utility quality

requirements. Mr. Giannini states that

California nectarines and peaches have

grown in production over the last 30

years from 1 million cartons annually to

almost 20 million cartons. He attributed

this growth to the industry’s quality

assurance program. Mr. Giannini states

further that during the 1995 season,

‘‘Utility’’ grade plums were marked up

at retail, but neither grower nor

consumer interests were well served.

Mr. Giannini believes that the goal of

providing lower cost plums to

consumers through implementation of

the ‘‘Utility’’ grade failed to materialize.

Comments supporting modification of

the proposed rule addressed revisions in

four areas: Whether the utility quality

requirements should be based on the

U.S. Standards for Grades; whether

there should be a limit on the amount

of U.S. No. 1 grade fruit in the utility

pack; where utility quality fruit should

be permitted to be marketed; and how

utility quality fruit should be labeled.

The Basis for Utility Quality

Requirements

As previously indicated, the

Department proposed defining utility

quality in terms of a modified U.S. No.

2 grade. In Messrs. Field and Tos’s

comments, they state that the

Committees support basing nectarine

and peach utility quality requirements

on the minimum quality standards

established in the California

Agricultural Code. The Committees

believe the quality requirements for

California nectarines and peaches

should be consistent with the minimum

requirements in place for the California

plum utility grade, which are based on

the California Agricultural Code.

In addition to providing consistency

within the California tree fruit industry,

the Committees believe that basing the

utility quality requirements on the

California Agricultural Code will result

in lower inspection costs. Mr. Field

provided a letter from Mr. John Wiley,

Branch Chief, Shipping Point

Inspection, California Department of

Food and Agriculture, which stated that

requiring inspectors to review product

for a quality requirement which is not

a part of their normal procedures would

increase the cost of inspection, thereby

increasing program costs, particularly to

small growers. Mr. Wiley stated further

that, having a proposed quality

requirement of U.S. No. 2 with different

tolerances for peaches and nectarines,

would increase the time required for

training and supervision as well as

increase the potential for confusion by

inspectors and the difficulty of

differentiating between the various

grades.

Mr. Gerawan supported using the

California Agricultural Code as a basis

for utility quality requirements. The

remaining commentors did not state

specifically whether they supported this

proposed modification or not. The

Department believes that the

Committees’ and Mr. Gerawan’s

arguments have merit. Also, defining

the utility quality requirements in terms

of the California Agricultural Code

should not result in any less fruit being

made available to fresh markets. For

these reasons, the Committees’ and Mr.

Gerawan’s proposed revision is adopted.

Limitation of U.S. No. 1 Grade Fruit in

Utility Packs

The Committees support limiting the

amount of U.S. No. 1 grade fruit that can

be included in a utility pack.

Specifically, they support a limit of 15

percent in any container. Mr. Field, in

his comment, states that a utility quality

requirement must be clearly distinct

from a U.S. No. 1 grade. Failure to

provide a clear distinction could cause

confusion in the marketplace and would

not meet the goal of providing low-cost

fruit to low-income consumers. Mr.

Field contends that the Department

failed to address this issue in its

proposal which to allow for a U.S. No.

2 grade, with a 100 percent tolerance for

misshapen and seriously scarred fruit;

and that such action would, in effect, do

away with regulatory grades in place for

California nectarines and peaches. Mr.

Field states that containers could be

marked as utility without regard to the

amount of U.S. No. 1 therein. Fruit

could be packed at 80–85 percent U.S.

No. 1 and fail marketing order

requirements, but rather than be

repacked, it could be marked utility and

marketed. This would cause confusion

in the marketplace since the fruit would

not be adequately distinguished from

U.S. No. 1 grade fruit. By the same

token, a container of nectarines or

peaches could have 0 percent U.S. No.

1 or 100 percent U.S. No. 1 product
Federal Register / Vol. 61, No. 85 / Wednesday, May 1, 1996 / Rules and Regulations 19163

inside, but could be marked utility for

whatever reason the shipper determined

appropriate. According to Mr. Field, this

clearly demonstrates why the

Committees believe it is necessary to

establish a maximum tolerance of 15

percent for U.S. No. 1 grade fruit in

containers marketed as utility grade

fruit.

In the comments received in support

of the proposed rule, five commentors

stated that the Department should not

set a 15 percent tolerance on U.S. No.

1 grade fruit in containers marked

utility. These commentors contend that

it would be too difficult and costly for

packers to meet a 15 percent tolerance

because some containers would not

meet the utility quality requirements

because they would have too much

‘‘good fruit’’ in the box. These

commentors could see no reasonable

justification for limiting the amount of

good quality fruit in a utility pack.

Mr. Rasmussen offered a compromise.

He believes that there should be a limit

on the amount of U.S. No. 1 grade fruit

in the utility pack to ensure a distinct

difference between the packs, but states

the 15 percent limit supported by the

Committees was overly restrictive. He

supports a limit of 30 percent. This limit

has proved workable for the California

plum industry’s use of a utility grade

standard.

The Department finds that Mr.

Rasmussen’s suggested revision is

reasonable. Thus, this rule provides that

the amount of fruit in a container of

utility quality fruit that meets or

exceeds the requirements of a U.S. No.

1 grade cannot exceed 30 percent.

Where Utility Quality Fruit May Be

Shipped

The Committees, through Mr. Field,

also comment that on an experimental

basis, utility quality fruit should be

limited to the domestic markets. Mr.

Field opines that under sections 916.54

and 917.43 of the orders, special

purpose shipments can be made for

research purposes for special markets.

Mr. Field believes that this authority

allows restricting utility grade

shipments, which would enable the

nectarine and peach industries to

continue studying the utility quality

requirements, the availability of lower

quality fruit to lower income

consumers, and the benefits of making

the lower quality product available. Mr.

Field believes limiting shipments of

utility quality fruit to the domestic

market would allow for these studies to

progress and would allay the fears of the

industries that low quality fruit in

export markets is to the long term

detriment of the industries.

Five commentors state that there is no

rationale for restricting the sale of utility

quality California nectarines and

peaches to Mexico, where there is

believed to be strong market demand for

the product. One commentor—Mr.

Rasmussen—did not state a position on

this subject.

The Committees did not provide

sufficient evidence that the adoption of

the CA Utility requirement for the 1996

season only would result in any damage

to export markets. Thus, the

Committees’ proposal is denied.

Labeling Requirements for Utility

Quality Fruit

The Committees, through Mr. Field,

comment that the name of the proposed

quality requirement, ‘‘CTFA Utility’’

should be known instead as ‘‘USDA

Utility’’. The Committees believe that

since the Department initially proposed

the utility quality requirements, such

quality requirements should be called

‘‘USDA Utility.’’ It is the consensus of

the Committees that the California

quality image could be diluted by using

‘‘California’’ or ‘‘CTFA’’ to describe the

lower quality product.

Mr. Field also states that containers of

utility quality California nectarines and

peaches should meet all size, marking,

and standard container requirements,

with the additional requirement that the

marking of ‘‘USDA Utility’’ should be a

minimum height of 3⁄4 inches and on the

visible display panel of the box. (The

proposed rule did not specify where

such marking should appear.) As

provided in the proposed rule,

consumer bags or packages are also

required to be to be marked. Requiring

the marking to be on a visible display

panel and on consumer packages will

enable consumers and retailers to

identify the fruit as utility quality when

it is palletized or on display at the retail

level.

Mr. Rasmussen is the only other

commentor who expresses an opinion

on this issue. He states that the utility

quality peaches and nectarines should

be known as ‘‘CA Utility.’’ This is

comparable to the designation used for

California plums, and having the same

nomenclature for peaches and

nectarines would be advantageous from

the standpoint of maintaining

uniformity among the three

commodities and creating less

confusion in the marketplace.

The Department finds that Mr.

Rasmussen’s position has merit and is

therefore adopted. Further, the

Committees’ proposal to require the

marking on a visible display panel also

has merit and is incorporated in this

final rule.

The intent of this rule is to establish

a minimum quality requirement for

California nectarines and peaches to

allow more fruit into fresh market

channels, ensure customer satisfaction

and improve returns to producers.

Moreover, as previously stated,

information gathered as a result of

allowing shipments of ‘‘CA Utility’’

quality fruit, for the 1996 season, can be

used to help determine appropriate

quality requirements for California

nectarines and peaches for the 1997

season.

This rule reflects the Department’s

appraisal of the need to revise the

quality and container marking

requirements for California nectarines

and peaches. The Department believes

that this rule will have a beneficial

impact on producers, handlers, and

consumers of California nectarines and

peaches.

Based on available information, the

AMS has determined that this action

will not have a significant economic

impact on a substantial number of small

entities.

After consideration of all relevant

matter presented, including the

information and recommendations

submitted by the Committees, the

comments received, and other available

information, it is hereby found that this

rule, as hereinafter set forth, will tend

to effectuate the declared policy of the

Act.

It is further found that good cause

exists for not postponing the effective

date of this rule until 30 days after

publication in the Federal Register (5

U.S.C. 553) because this rule should

apply to as many shipments of

California nectarines and peaches as

possible. The shipping seasons for both

California nectarines and peaches began

on April 1, 1996. Further, handlers are

aware of this rule, which was

recommended in a proposed rule in

early March and discussed in public

meetings of the Committees. Also, this

rule provides an additional alternative

for handlers of California nectarines and

peaches, and no additional time is

needed for those handlers to comply

with the relaxed quality requirements.

Finally, a 30-day comment period was

provided for in the proposed rule, and

all comments have been considered in

developing this final rule.

List of Subjects

7 CFR Part 916

Marketing agreements, Nectarines,

Reporting and recordkeeping

requirements.
19164 Federal Register / Vol. 61, No. 85 / Wednesday, May 1, 1996 / Rules and Regulations

7 CFR Part 917

Marketing agreements, Peaches, Pears,

Reporting and recordkeeping

requirements.

For the reasons set forth in the

preamble, 7 CFR Parts 916 and 917 are

amended as follows:

1. The authority citation for 7 CFR

Parts 916 and 917 continues to read as

follows:

Authority: 7 U.S.C. 601–674.

PART 916—NECTARINES GROWN IN

CALIFORNIA

2. Section 916.350 is amended by

adding a new paragraph (d) to read as

follows:

§ 916.350 California Nectarine Container

and Pack Regulation.

* * * * *

(d) During the period April 1 through

October 31, 1996, each container or

package when packed with nectarines

meeting CA Utility requirements, shall

bear the words ‘‘CA Utility’’, along with

all other required container markings, in

letters of 3⁄4 inch minimum height on

the visible display panel. Consumer

bags or packages must also be clearly

marked on the bag or package as ‘‘CA

Utility’’ along with other required

markings.

3. Section 916.356 is amended by

revising paragraph (a)(1) to read as

follows:

§ 916.356 California Nectarine Grade and

Size Regulation.

(a) * * *

(1) Any lot or package or container of

any variety of nectarines unless such

nectarines meet the requirements of U.S.

No. 1 grade: Provided, that nectarines 2

inches in diameter or smaller, shall not

have fairly light colored, fairly smooth

scars which exceed an aggregate area of

a circle 3⁄8 inch in diameter, and

nectarines larger than 2 inches in

diameter shall not have fairly light

colored, fairly smooth scars which

exceed an aggregate area of a circle 1⁄2

inch in diameter: Provided further, That

an additional tolerance of 25 percent

shall be permitted for fruit that is not

well formed but not badly misshapen.

Provided further, That during the period

April 1 through October 31, 1996, any

handler may handle nectarines if such

nectarines meet ‘‘CA Utility’’ quality

requirements. The term ‘‘CA Utility’’

means that not more than 30 percent of

the nectarines in any container meet or

exceed the requirements of the U.S. No.

1 grade and that such nectarines are

mature and are:

(i) Free from insect injury which has

penetrated or damaged the flesh; split

pits which cause an unhealed crack or

one or more well healed cracks which,

either singly or in the aggregate, are

more than 3⁄8 inch in length; mold,

brown rot, and decay which has affected

the edible portion; and

(ii) Free from serious damage due to

skin breaks, cuts, growth cracks, bruises,

or other causes.

(iii) Tolerances. Not more than 10

percent, by count, of the nectarines in

any one container may be below the

requirements which are prescribed by

this subparagraph, including not more

than 5 percent, by count, for any one

defect, except split pits. An additional

tolerance of 10 percent, by count, of the

nectarines in any one container or bulk

lot may contain nectarines affected with

split pits. This means a total tolerance

of 20 percent is allowed for all defects,

including split pits, but not to exceed 15

percent for split pits alone.

* * * * *

PART 917—FRESH PEARS AND

PEACHES GROWN IN CALIFORNIA

3. Section 917.442 is amended by

adding a new paragraph (d) to read as

follows:

§ 917.442 California Peach Container and

Pack Regulation.

* * * * *

(d) During the period April 1 through

November 23, 1996, each container or

package when packed with peaches

meeting CA Utility requirements, shall

bear the words ‘‘CA Utility’’, along with

all other required container markings, in

letters of 3⁄4 inch minimum height on

the visible display panel. Consumer

bags or packages must also be clearly

marked on the bag or package as ‘‘CA

Utility’’ along with other required

markings.

4. Section 917.459 is amended by

revising paragraph (a)(1) to read as

follows:

§ 917.459 California Peach Grade and Size

Regulation.

(a) * * *

(1) Any lot or package or container of

any variety of peaches unless such

peaches meet the requirements of U.S.

No. 1 grade: Provided, that an additional

25 percent tolerance shall be permitted

for fruit with open sutures which are

damaged, but not seriously damaged.

Provided, That during the period April

1 through November 23, 1996, any

handler may handle peaches if such

peaches meet ‘‘CA Utility’’ quality

requirements. The term ‘‘CA Utility’’

means that not more than 30 percent of

the peaches in any container meet or

exceed the requirements of the U.S. No.

1 grade and that such peaches are

mature and are:

(i) Free from insect injury which has

penetrated or damaged the flesh; split

pits which cause an unhealed crack or

one or more healed cracks which, either

singly or in the aggregate, are more than

1⁄2 inch in length; and mold, brown rot,

and decay; and

(ii) Free from serious damage due to

cuts, skin breaks, growth cracks, bruises,

scab, rust, blight, disease, hail or other

causes. Damage to any peach is serious

when it causes a waste of 10 percent or

more, by volume, of the individual

peach.

(iii) Tolerances. Not more than 10

percent, by count, of the peaches in any

container may be below the

requirements prescribed by this

subparagraph. Not more than one-half of

this tolerance shall be allowed for any

one cause. Individual containers in any

lot may contain not more than 1 1⁄2

times the tolerances specified if the

percentage of defects of the entire lot

averages within the tolerances.

* * * * *

Dated: April 25, 1996.

Robert C. Keeney,

Director, Fruit and Vegetable Division.

[FR Doc. 96–10758 Filed 4–30–96; 8:45 am]

BILLING CODE 3410–02–P

DEPARTMENT OF TRANSPORTATION

Office of the Secretary

14 CFR Parts 205 and 323

[Docket No. OST–96–1269]

RIN 2105–AC46

Aircraft Accident Liability Insurance;

Terminations, Suspensions, and

Reductions of Service

AGENCY: Office of the Secretary,

Department of Transportation.

ACTION: Final rule.

SUMMARY: The Department is amending

its regulations on aircraft accident

liability insurance and on terminations,

suspensions, and reductions of essential

air service, to remove or update obsolete

provisions and organizational and

statutory references.

EFFECTIVE DATE: The rule shall become

effective on May 31, 1996.

FOR FURTHER INFORMATION CONTACT:

Carol A. Woods, Air Carrier Fitness

Division, X–56, Department of

Transportation, 400 Seventh Street,

SW., Washington, DC 20590, (202) 366–

9721.

SUPPLEMENTARY INFORMATION: In his

Regulatory Reinvention Initiative