[Federal Register Volume 61, Number 17 (Thursday, January 25, 1996)]
[Notices]
[Pages 2378-2385]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-1212]



      

[[Page 2377]]

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Part III





Environmental Protection Agency





_______________________________________________________________________



The Pesticide Coordination Policy; Response to Petitions; Pesticides; 
Status of Dried Commodities as Raw Agricultural Commodities; Notices

Federal Register / Vol. 61, No. 17 / Thursday, January 25, 1996 / 
Notices

[[Page 2378]]


ENVIRONMENTAL PROTECTION AGENCY

[OPP-300409; FRL-4991-9]


The Pesticide Coordination Policy; Response to Petitions

AGENCY: Environmental Protection Agency (EPA).

ACTION: Response to Petition.

-----------------------------------------------------------------------

SUMMARY: This notice completes EPA's response to a petition filed by 
the National Food Processors Association and others in 1992 and 
additionally responds to a second petition filed by the same parties in 
1995. The 1992 petition sought the repeal or revision of several EPA 
policies and interpretations related to how EPA coordinates actions 
under its various statutory authorities over pesticide residues in 
food. EPA has decided not to alter significantly its general policy of 
taking all applicable legal authorities into account in ruling on a 
pesticide use. The 1995 petition urged EPA to rapidly complete its 
response to the 1992 petition. By publishing this notice EPA has met 
that request.

FOR FURTHER INFORMATION CONTACT: By mail: Jean Frane, Policy and 
Special Projects Staff (7501C), Environmental Protection Agency, 401 M 
St. SW., Washington, DC 20460. Office location, telephone number, and 
e-mail address: Rm. 1113I, Crystal Mall #2, 1921 Jefferson Davis 
Highway, Arlington, VA, 703-305-5944, e-mail: 
<a href="/cdn-cgi/l/email-protection#5e382c3f303b70343b3f301e3b2e3f333f3732703b2e3f70393128"><span class="__cf_email__" data-cfemail="690f1b08070c47030c0807290c190804080005470c1908470e061f">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

I. Introduction

    In Les v. Reilly, 968 F.2d 985 (9th Cir. 1992), cert. denied, 113 
S.Ct. 1361 (1993), the Ninth Circuit U.S. Court of Appeals held that 
the Delaney anti-cancer clause in the food additives provision of the 
Federal Food, Drug, and Cosmetic Act (FFDCA) was not subject to an 
exception for pesticide uses which pose a de minimis cancer risk. Prior 
to the decision becoming final, in September 1992, food processors and 
growers filed a petition with EPA challenging a number of policies and 
interpretations relating to how EPA implements its authority under the 
FFDCA. The petition proposes policies and interpretations that would 
reduce the impact of the Les decision. EPA issued a partial response to 
the petition on June 14, 1995 (60 FR 31300) (June 1995 NFPA Response), 
and this notice completes EPA's response. Following the June 1995 NFPA 
Response, the same food processors and growers filed a second petition 
urging a prompt response to the entirety of its 1992 petition and 
raising various other issues. This second petition is addressed in this 
document as well.

II. Background

A. Statutory Background

    Pesticide residues in human and animal food in the United States 
are regulated under provisions of the FFDCA and the Federal 
Insecticide, Fungicide, and Rodenticide Act (FIFRA). The interplay 
between sections 402, 408 and 409 of the FFDCA and, to a more limited 
extent, between the FFDCA and FIFRA, have created a complex and 
sometimes contradictory statutory framework underlying residue 
regulation in food.
    Before a pesticide may be sold or distributed, it must be 
registered under FIFRA. 7 U.S.C. 136 et seq. To qualify for 
registration, a pesticide must, among other things, perform its 
intended function without causing ``unreasonable adverse effects on the 
environment.'' 7 U.S.C. 136a(c)(5). The term ``unreasonable adverse 
affects on the environment'' is defined as ``any unreasonable risk to 
man or the environment taking into account the economic, social and 
environmental costs and benefits of the use of any pesticide.'' 7 
U.S.C. 136(bb).
    The FFDCA, 21 U.S.C. 301 et. seq., authorizes the establishment by 
regulation of maximum permissible levels of pesticides in foods. Such 
regulations are commonly referred to as ``tolerances.'' Without such a 
tolerance or an exemption from the requirement of a tolerance, a food 
containing a pesticide residue is ``adulterated'' under section 402 of 
the FFDCA and may not be legally moved in interstate commerce. 21 
U.S.C. 331, 342. Monitoring and enforcement of pesticide tolerances are 
carried out by the U.S. Food and Drug Administration (FDA) and the U.S. 
Department of Agriculture (USDA).
    The FFDCA has separate provisions for tolerances for pesticide 
residues on raw agricultural commodities (RACs) and for residues on 
processed food. For pesticide residues in or on RACs, EPA establishes 
tolerances, or exemptions from tolerances when appropriate, under 
section 408. 21 U.S.C. 346a. EPA regulates pesticide residues in 
processed foods under section 409 which pertains to ``food additives.'' 
21 U.S.C. 348. Maximum residue regulations established under section 
409 are commonly referred to as food additive tolerances or food 
additive regulations (FARs). Section 409 FARs are needed, however, only 
for certain pesticide residues in processed food. Under section 
402(a)(2) of the FFDCA, a pesticide residue in processed food generally 
will not render the food adulterated if the residue results from 
application of the pesticide to a RAC and the residue in the processed 
food when ``ready to eat'' is below the RAC tolerance set under section 
408. This exemption in section 402(a)(2) is commonly referred to as the 
``flow-through'' provision because it allows the section 408 raw food 
tolerance to flow through to the processed food form. Thus, a section 
409 FAR is only necessary to prevent foods from being deemed 
adulterated when the concentration of the pesticide residue in a 
processed food when ``ready to eat'' is greater than the tolerance 
prescribed for the RAC, or if the processed food itself is treated or 
comes in contact with a pesticide.
    To establish a tolerance regulation under section 408, EPA must 
find that the regulation would ``protect the public health.'' 21 U.S.C. 
346a(b). In reaching this determination, EPA is directed to consider, 
among other things, the ``necessity for the production of an adequate, 
wholesome, and economical food supply.'' Id. Prior to establishing a 
food additive tolerance under section 409, EPA must determine that the 
``proposed use of the food additive [pesticide], under the conditions 
of use to be specified in the regulation, will be safe.'' 21 U.S.C. 
348(c)(3). Section 409 specifically addresses the safety of 
carcinogenic substances in the so-called Delaney clause which provides 
that ``no additive shall be deemed safe if it has been found to induce 
cancer when ingested by man or animal or if it is found, after tests 
which are appropriate for the evaluation of the safety of food 
additives, to induce cancer in man or animal. . . .'' Id. Although EPA 
has interpreted the general standard under section 408 to require a 
balancing of risks and benefits, where a pesticide which is an animal 
or human carcinogen is involved, the section 409 Delaney clause, in 
contrast to section 408 and FIFRA, explicitly bars such balancing no 
matter how infinitesimal the potential human cancer risk. Les v. 
Reilly, 968 F.2d at 989.

B. Coordination of the Statutory Provisions Governing Pesticides

    EPA regulations in 40 CFR 152.112(g) specify that FIFRA 
registrations for food-use pesticides will not be approved until all 
necessary tolerances and food additive tolerances have been obtained. 
As a policy matter, EPA has taken a similar approach to FFDCA sections 
408 and 409, not granting section 408 

[[Page 2379]]
tolerances until needed section 409 FARs have been granted.
    EPA describes this linkage of its statutory authorities as its 
coordination policy. Basically, EPA's coordination policy is an 
expression of EPA's intent to take into account all of the applicable 
provisions governing pesticides in taking action under any one of the 
three. EPA's view has been that it should not be approving pesticide 
uses under one of the three provisions if an approval needed under one 
of the other provisions cannot be obtained.
    Inextricably related to the coordination policy is EPA's 
concentration policy. The concentration policy establishes the criteria 
as to when approval is needed for food-use pesticides under FFDCA 
section 409, and hence the Delaney clause. Prior to the June 1995 NFPA 
Response, EPA used a ``concentration in fact'' standard as the test of 
whether a use needs a section 409 FAR. The concentration in fact 
standard was met and a FAR deemed necessary if a processing study shows 
that the level of pesticide residue in the processed food exceeds the 
level of residue in the precursor raw agricultural commodity. In its 
June 1995 NFPA Response, EPA modified its concentration policy by 
recognizing that: (1) Data and information other than processing 
studies are relevant to the question of whether a section 409 FAR is 
needed to prevent the adulteration of processed food, and (2) the 
ready-to-eat criterion in the flow-through proviso had to be considered 
in making determinations as to the need for section 409 FARs.

III. The NFPA Petitions

    On September 11, 1992, the National Food Processors Association 
(NFPA), the United Fresh Fruit and Vegetable Association, the Florida 
Fruit and Vegetable Association, the Northwest Horticultural Council 
and the Western Growers Association filed a petition with EPA 
challenging the policies followed by EPA in linking its regulatory 
activities under the various pesticide provisions of FIFRA and FFDCA. 
(Petition to the Environmental Protection Agency Office of Pesticide 
Programs Concerning EPA's Pesticide Concentration Policy (1992)) 
(hereinafter cited as ``NFPA petition''). The NFPA petition explicitly 
attacks what it calls EPA's ``concentration policy.'' In actuality, the 
petition is a challenge to two interrelated policies described by EPA 
as its coordination and concentration policies. With respect to the 
coordination policy, the NFPA petition argues that the coordination 
policy is both unlawful and unnecessary. The petition requests that the 
EPA coordination policy be repealed so that section 408 tolerances can 
remain in effect (or can be established) for pesticide uses even when, 
under the Les decision, the associated section 409 FARs have to be 
revoked (or cannot be established).
    EPA sought public comment on the petition (58 FR 7470; February 5, 
1993). Extensive public comment was received and significant comments 
are discussed in this notice. Following the June 1995 NFPA Response, 
the main issue in the NFPA petition that remains to be addressed is the 
coordination policy.
    On July 10, 1995, NFPA filed a second petition (NFPA Petition II). 
This petition sought a quick decision on the coordination policy and 
raised two additional issues. First, the petition reiterated arguments 
made by NFPA in comments filed on its original petition that pesticide 
residues in processed food exceeding the applicable section 408 
tolerance fall under section 406 of the FFDCA and not section 409. 
Second, NFPA asked that EPA rapidly implement the revised policies in 
the June 1995 NFPA Response and contended that the FFDCA barred EPA 
from revoking any FARs on Delaney clause grounds prior to reexamining 
the need for the FARs under the revised concentration policy.

IV. Summary of EPA Response to NFPA Petition

    Unit V. of this document sets forth EPA's response to the NFPA 
petition regarding EPA's coordination policy. EPA has decided to retain 
its coordination policy largely intact. EPA believes that it has a 
fundamental responsibility to avoid inconsistent action under its 
statutory authorities and that this responsibility is best met by its 
coordination policy. Legally-used pesticides should not result in 
illegal food. However, EPA is willing to consider an exception to a 
coordination approach to avert severe economic disruption if other 
steps are feasible to prevent adulterated processed food from entering 
commerce. EPA rejects NFPA's argument that any needed tolerances for 
pesticide residues in processed food should be set under section 406 
rather than section 409.
    By publishing this notice, EPA has met the central request of NFPA 
Petition II--that EPA make a decision regarding the coordination 
policy. This notice also responds to the other issues in that petition. 
As noted above, EPA rejects the contention that pesticide residues in 
processed food should be regulated under section 406. Additionally, in 
Unit VI. of this document EPA explains that as a policy matter it 
intends to examine whether, for tolerances for which a proposed 
revocation on Delaney clause grounds is pending, revocation on the 
basis of its revised concentration policy is appropriate. However, EPA 
also makes clear that it disagrees with NFPA's suggestion that such a 
course is required by the statute.

V. Coordination of Authorities under FIFRA and FFDCA

A. Coordination Policy

    EPA's coordination policy represents EPA's attempt to apply its 
various statutory mandates on pesticides in a consistent fashion. It is 
based on the rationale that actions approved under one statute or one 
provision of one statute should not lead to illegal consequences under 
another provision. Simply put, if farmers use a pesticide lawfully on 
their crops, the food made from those crops should not be rendered 
illegal because of the presence of pesticide residues. The coordination 
policy predates the existence of EPA and can be traced back at least to 
1963 when Congress recognized that USDA and FDA coordinated their 
actions under FIFRA and FFDCA, respectively. S. Rep. No. 573, 88th 
Cong., 1st Sess. 2-3, 9-10 (1963). In fact, the drafters of section 408 
actually suggested that government action on pesticides under FIFRA and 
FFDCA should be coordinated. S. Rep. 1635, 83rd Cong., 2d Sess. 3 
(1954). Congress, however, has never codified this policy except to the 
limited extent it has required that tolerances be in place before 
states may grant special local need registrations under FIFRA. 7 U.S.C. 
136v(c)(3).
    EPA has continued the FDA and USDA practice of coordinating its 
action under FIFRA and the FFDCA. By regulation, EPA has made it a 
requirement of FIFRA registration that all ``needed'' tolerances under 
sections 408 and 409 be in place. 40 CFR 152.112(g); see 40 CFR 
162.7(d)(3)(v) (1976) (the predecessor to the current regulation). 
Although not included in any regulation, EPA has generally followed a 
policy of not granting a section 408 tolerance if a section 409 FAR is 
needed but has not been or cannot be approved. 53 FR 41104, 41108 
(October 19, 1988). EPA believes a necessary corollary to this policy 
and regulation is that if a needed tolerance is revoked, all 
corresponding tolerances and the registration should be removed as 
well.
    The original NFPA petition, as well as many of the comments on the 
petition, blurs the distinction between the existence of the 
coordination policy and 

[[Page 2380]]
the criteria EPA follows in determining when a food additive tolerance 
is ``needed.'' The criteria for when a food additive regulation is 
needed are what EPA describes as its concentration policy. In the June 
1995 NFPA Response, EPA has addressed the concerns expressed regarding 
its concentration policy.
    The main criticism of the coordination policy by the NFPA petition 
is that through this policy EPA has ``imported'' the Delaney clause 
into section 408 and FIFRA. EPA, the petition asserts, has illegally 
ignored the risk/benefit standard in FIFRA as well as section 408's 
requirement that EPA set tolerances so as to ``protect the public 
health'' taking into consideration the ``necessity for the production 
of an adequate, wholesome, and economical food supply.'' However, NFPA 
did acknowledge that ``[u]nder some circumstances revocation of a 409 
FAR may appropriately prompt reexamination of the basis for the 
counterpart section 408 tolerance, in order to determine whether the 
raw product tolerance remains consistent with the statutory criteria 
prescribed in section 408.'' (Comments of the NFPA at 9 n.4)(emphasis 
in original).
    A second legal objection to the coordination policy raised by the 
NFPA petition is that choosing a coordination policy approach over a 
policy approach which focuses on enforcement ``stands the flow-through 
provision on its head.'' (NFPA Petition at 35). According to NFPA, 
``[t]he EPA policy prohibits any use of a pesticide on a crop if the 
Delaney clause precludes issuance of a section 409 food additive 
regulation for the pesticide in the processed food, regardless of 
whether processors can in fact satisfy the conditions of the proviso.'' 
Id. at 36 (emphasis in original). Finally, the NFPA petition argues 
that the coordination policy is inconsistent with FDA's contemporaneous 
interpretation of the statute.
    Taking a different view, the Natural Resources Defense Council 
(NRDC), in comments on the NFPA petition, contends that the FFDCA 
mandates that EPA follow a coordination policy. Noting that section 408 
requires consideration of the ``necessity for a wholesome food supply'' 
and ``other ways in which the consumer may be affected by the same 
pesticide chemical,'' NRDC argues that for a pesticide which 
concentrates above the section 408 level, these requirements bar 
establishment of a tolerance. (Comments of NRDC at 11-12). NRDC states 
that a use of a pesticide which produces adulterated processed food 
does not contribute to a ``wholesome'' food supply and that EPA is 
required to consider that the pesticide produces adulterated food by 
the ``other ways in which the consumer may be affected'' clause.
    1. The proper relationship of the Delaney clause to FIFRA and FFDCA 
section 408. EPA agrees with NFPA that the Delaney clause is not a 
legal standard directly governing section 408 tolerances or FIFRA 
registrations. See Environmental Defense Fund v. HEW, 428 F.2d 1083, 
1091 (D.C. Cir. 1970). Nonetheless, EPA believes that in some 
circumstances the Delaney clause affects decisionmaking under FIFRA and 
FFDCA section 408. EPA has an obligation to attempt to construe its 
statutory authorities governing the same matters as harmoniously as 
possible. EPA has construed FIFRA and FFDCA sections 408 and 409 to be 
overlapping in some respects, and EPA believes it is appropriate, where 
an overlap is identified, to give some weight to all aspects of the 
statute, including the Delaney clause.
    There is an overlap between FIFRA and FFDCA sections 408 and 409 
where approval of a pesticide use on raw food under FIFRA or FFDCA 
section 408 can lead to residues in processed food which exceed the 
section 408 tolerance. This overlap occurs because EPA takes into 
account the exposure which results from pesticide residue carryover to 
processed food from application to the raw food in considering 
registrations under FIFRA and section 408 tolerances for food-use 
pesticides. Thus, the computer model EPA uses for dietary risk 
assessment takes into account potential residues in all forms of foods, 
not just the actual raw crop to which the pesticide is applied. EPA 
believes considering pesticide exposure from all food to be an 
essential part of its basic statutory responsibility under FIFRA and 
section 408 to evaluate the risk posed by the specific pesticide use in 
question. Given the broad statutory standards in FIFRA (``unreasonable 
risk'') and FFDCA section 408 (``protect the public health''), it would 
be difficult to describe consideration of all possible residues as not 
in accordance with law or arbitrary or capricious.
    Having identified an overlap, the question remains as to how the 
various provisions are to be construed harmoniously. EPA believes this 
is best accomplished by treating the Delaney clause as indicating that 
Congress had a heightened concern for carcinogenic pesticide residues 
in processed food where those residues exceed the section 408 
tolerance. Thus, EPA, in making the risk/benefit balancing 
determination called for under FIFRA and section 408 for a carcinogenic 
pesticide, takes into account the likelihood that residues of the 
pesticide will exceed the section 408 tolerance in processed food and 
the added weight such overtolerance residues are due in light of the 
Delaney clause.
    Additionally, in evaluating the benefits provided by use of a 
pesticide in the FIFRA and section 408 risk/benefit decision, EPA must 
consider the extent to which use of a pesticide could result in 
adulterated food. Adulterated food resulting from use of a pesticide 
would decrease any benefits the pesticide provided to society. Thus, 
the Delaney clause's effect of denying a FAR for carcinogenic 
pesticides affects benefits determinations as well as risk evaluations 
under FIFRA and section 408.
    Thus, EPA's coordination policy does not depend on writing the 
Delaney clause into FIFRA and FFDCA section 408 but is based on 
interpretation of the legal standards of FIFRA and section 408 and a 
consideration of the full range of residues that may result from use of 
a pesticide consistent with approval under FIFRA and section 408.
    Under EPA's formulation of how the Delaney clause is appropriately 
considered in FIFRA and section 408 actions, there still remains a 
degree of agency flexibility. In situations at the extremes, either 
where there is evidence showing that residues in processed food would 
always exceed the section 408 tolerance or that such overtolerance 
residues would never occur, EPA will have little or no discretion. For 
example, where the possibility of residues exceeding the section 408 
tolerance depends upon misuse of the pesticide (and such misuse would 
generally not be expected), EPA believes its authority to revoke the 
section 408 tolerance associated with such a use and cancel its FIFRA 
registration would be limited. The opposite of course is true as well: 
if data show that processed food will always contain residues at levels 
greater than the section 408 tolerance level and that the raw crop is 
commonly processed, EPA would have little discretion over whether to 
establish or continue the FIFRA use and FFDCA section 408 tolerance. In 
circumstances between these two extremes EPA has more flexibility. For 
example, where legal use patterns and normal circumstances suggest a 
possibility of overtolerance residues in more than a trivial amount of 
processed food but the probability of overtolerance residues is low, 
EPA has two options.
    One option, advocated by NFPA, would be not to establish a food 

[[Page 2381]]
    additive regulation, but leave the section 408 tolerance in place and 
rely on enforcement actions under the statutory scheme as laid out in 
the flow-through provision to police the food supply. The second option 
would be to follow a coordination policy such as EPA's present one 
which would call for a revocation of the section 408 tolerance and 
cancellation of the FIFRA registration. Selecting between the two 
requires balancing of a number of factors including resource 
constraints, public health considerations, industry concerns regarding 
both flexibility and certainty, agency credibility, effects on the 
price and availability of food for consumers, and impacts upon 
agriculture. NRDC's legal arguments do not convince EPA that there is 
no room for policy judgment in this area. NRDC's arguments appear to 
rely on the premise that all processed food produced from a particular 
crop would have pesticide residues in excess of the section 408 
tolerance.
    EPA believes that several policy factors weigh in favor of its 
coordination policy. First, FDA has limited resources for policing the 
food supply. The difference in resource requirements between charging 
FDA with finding adulterated food already in the food distribution 
system and requiring EPA to make a pre-marketing judgment are enormous. 
A pre-marketing judgment can be made on a discrete data set but after-
the-fact policing of the food supply involves sampling of food 
throughout the country. The NFPA in instituting its Protective Screen 
Program against illegal residues has recognized the limitations of 
relying on after-the-fact monitoring. The NFPA's Protective Screen 
Program states that:

    It is important to recognize that monitoring or testing programs 
cannot serve as the sole or even primary assurance that finished 
food products will be free from illegal pesticide residues. The 
emphasis must be on preventing the occurrence of contamination 
rather than reliance on its detection after- the-fact. (NFPA 
Petition, App. B at 6).

    Second, if EPA places primary emphasis on an after-the-fact 
monitoring scheme and thus FDA increasingly must seize adulterated 
food, the public may become unduly alarmed and as a consequence avoid 
foods which are critical to a healthy, well-balanced diet.
    Third, NFPA has not adequately explained how an after-the-fact 
monitoring scheme could be enforced other than through a massive 
expansion of FDA's sampling program. In fact, the NFPA itself 
acknowledges that it relies on EPA's coordination policy (legal use 
should result in legal food) as its guiding premise in preventing 
adulteration of food. The NFPA Protective Screen Program provides:

    The premise of the NFPA Protective Screen Program is that if a 
pesticide is used legally to produce a raw agricultural commodity, 
then the resulting residue on the pesticide in the food will be 
legal. Thus, the emphasis of the program is on the prevention of 
illegal pesticide uses and residues, as opposed to detection after 
the fact. (NFPA Petition, App. B at 1).

    Finally, EPA must take into account, as noted in comments by NRDC, 
that the history of the FFDCA indicates a congressional preference in 
favor of pre-market clearance of potentially deleterious substances 
rather than a dependance on after-the-fact seizure of adulterated food. 
See Ewig Bros., 502 F.2d at 720-21.
    It is more difficult to weigh the risk considerations relative to 
removing specific pesticide uses from the market under the coordination 
policy. Independent of statutory constraints, EPA's judgment is that 
many uses that would have to be revoked under the coordination policy 
pose insignificant risks. If the risks from these uses were 
significant, EPA would likely be taking action under FIFRA or FFDCA 
section 408. On the other hand, EPA cannot ignore that such uses result 
in levels of residues in processed food that Congress has concluded, 
through passage of the Delaney clause, should not be allowed.
    EPA has also considered the potential impacts on agriculture that 
could occur from the loss of pesticide uses that a coordination 
approach might cause. The Economic Impact Analysis prepared by EPA 
shows that, if the concentration and coordination policies were left 
intact, there could be substantial impacts upon agriculture. The 
changes EPA has made in its concentration and ready-to-eat policies in 
the June 1995 NFPA response are expected to greatly diminish the number 
of section 409 tolerances required and thus the number of uses 
affected. In applying those policies to a proposed revocation of animal 
feed tolerances published in the Federal Register of September 21, 1995 
(60 FR 49142), EPA concludes that almost half of the 36 FARs that were 
potentially inconsistent with the Delaney clause can be revoked as 
unnecessary under EPA's revised concentration policy. Moreover, if 
individual uses are affected, EPA believes that the impacts on 
consumers and agriculture will be minimal. As a general matter, 
therefore, EPA concludes that the various policy factors weigh strongly 
in favor of following a coordination policy.
    EPA would emphasize that its choice of a coordination approach is a 
policy judgment and although, as a general matter, EPA intends to 
adhere to this approach, EPA cannot rule out the possibility that in a 
given situation the balance of factors supporting a coordination policy 
may shift away from a pre-market clearance procedure and toward the 
more costly and inefficient process of after-the-fact enforcement. For 
example, application of the coordination policy may result in the 
cancellation of a use or group of uses that is so central to the 
production of a certain crop that the revocation of that use or uses 
would severely disrupt domestic production of that commodity with 
attendant consequences to the price and availability of food to the 
consumer. In these circumstances, EPA believes it may be appropriate to 
allow an exception to the coordination policy.
    EPA believes, however, that the potential for excepting a pesticide 
use from the coordination policy is slight. EPA would only do so where 
a clear showing of severe economic disruption was made and that 
economic disruption outweighs EPA concerns regarding an after-the-fact 
monitoring scheme both generally and as to the specific commodity 
involved. One critical factor here may be the ability of growers and 
processors to provide information demonstrating how an after-the-fact 
monitoring program could feasibly be implemented.
    2. Alleged inconsistency with the flow-through provision. A second 
legal objection to the coordination policy raised by the NFPA petition 
is that choosing a coordination policy approach over one which focuses 
on enforcement ``stands the flow-through provision on its head.'' (NFPA 
Petition at 35). According to NFPA, ``[t]he EPA policy prohibits any 
use of a pesticide on a crop if the Delaney clause precludes issuance 
of a section 409 FAR for the pesticide in the processed food, 
regardless of whether processors can in fact satisfy the conditions of 
the proviso.'' Id. at 36 (emphasis in original).
    When presented in this manner, NFPA's claim is overstated. The 
coordination policy is based on the rationale that data show that 
processing of legally-treated crops under good manufacturing practices 
may produce adulterated food. If the NFPA is concerned that EPA has 
failed to consider whether food processors can reduce residues in 
processed food below the section 408 tolerance, this is not a quarrel 
with the coordination policy so much as with the EPA criteria as to 
when a section 409 FAR is needed. EPA believes the adjustments to its 
concentration policy in the June 1995 

[[Page 2382]]
NFPA Response respond to NFPA's concerns on this issue.
    Ultimately, however, there remains the basic disagreement between 
EPA and the views presented by NFPA in its petition. EPA believes that 
it has an important role to play at the pre-market stage of pesticide 
regulation to ensure that legally-treated crops produce legal food. 
NFPA argues that pre-market regulation by EPA is unnecessary--growers 
and processors are capable of insuring that residues in processed food 
do not exceed the section 408 tolerance. NFPA, however, presents no 
scheme for enforcing such a system. In fact, as noted above, NFPA 
itself has admitted that generally an enforcement scheme premised 
solely on after-the-fact monitoring cannot work.
    3. Contemporaneous interpretation. A third legal objection to the 
coordination policy raised by NFPA is that it departs from FDA's 
interpretation of the relationship of sections 408 and 409 issued 
contemporaneously with the passage of section 409. NFPA claims that FDA 
in initially implementing section 409 did not follow a policy of 
requiring that a section 409 FAR for a pesticide be established where 
there was a possibility that residues of the pesticide in processed 
food could exceed the RAC tolerance. NFPA cites no explicit statement 
of FDA policy to support this claim; instead, NFPA relies solely on 
inferences drawn from an FDA regulation and FDA's purported failure to 
require food additive regulations in situations where a coordination 
policy allegedly would have dictated they be established.
    The FDA regulation cited by NFPA contains an explanation of the 
flow-through provision. NFPA places particular emphasis on the 
following example included in the regulation:

    If fruit bearing a residue of 7 parts per million of DDT, 
permitted on the raw agricultural commodity is dried and a residue 
in excess of 7 parts per million of DDT results on the dried fruit, 
the dehydrated fruit is adulterated unless the higher tolerance for 
DDT is authorized by the regulations in this part. 21 CFR 170.19 
(originally adopted 24 FR 2434, March 29, 1959).

    According to NFPA, this rather straightforward explication of the 
flow-through provision proves FDA did not require food additive 
regulations where concentration in the processed food was a possibility 
because, if it had, the situation described in the regulation 
(processed food having residues above the RAC tolerance and no section 
409 FAR in place) could never occur. If the situation could never 
occur, NFPA's logic runs, FDA would not have used it as an example in 
its regulations.
    EPA, however, does not believe the FDA example is inconsistent with 
a coordination policy approach. FDA's regulation is designed to explain 
the operation of the flow-through provision. It is difficult to see how 
FDA could adequately explain that provision without using an example 
similar to the one chosen. Moreover, a mere explanation of how 
statutory language operates to render certain food adulterated does not 
preclude the existence of a policy designed to prevent such 
adulteration from occurring. The example remains relevant even if a 
coordination policy is in place. EPA's coordination policy does not 
guarantee that residues in processed food will never exceed the section 
408 tolerance. Rather, EPA attempts to identify at the pre-marketing 
stage, pesticide uses which may result in residues in processed food 
greater than the section 408 tolerance. In actual practice, EPA's 
premarketing judgment may be incorrect and overtolerance residues may 
occur in processed food. FDA's dried fruit example is consistent with 
its responsibility to identify the consequences of residues over the 
section 408 tolerance in processed food despite whatever policies FDA 
followed to avoid that situation in the first place.
    NFPA's reliance on the nonexistence of certain food additive 
regulations for various registered pesticide uses is an equally weak 
basis for NFPA's claim that FDA's contemporaneous construction rejected 
a coordination approach to sections 408 and 409. NFPA claims FDA could 
not have followed a coordination policy because FDA issued numerous RAC 
tolerances on foods without establishing food additive regulations 
despite the fact that these foods (e.g., tomatoes) have processed forms 
(e.g., tomato paste) in which residues possibly could concentrate.
    However, NFPA fails to mention that FDA was setting section 409 
FARs for some processed foods as early as 1960 out of concern over 
concentrating residues. See 25 FR 2076 (March 11, 1960); 25 FR 10570 
(November 4, 1960); 27 FR 3694 (April 16, 1963). This is consistent 
with EPA's current practice of requiring section 409 FARs only where 
data on a specific pesticide use show that residues concentrate when a 
RAC is processed and thus there may be residues over the section 408 
tolerance in the processed food. EPA has not, for example, set section 
409 FARs on tomato paste for every pesticide that is registered on 
tomatoes. Accordingly, the fact that FDA did not set food additive 
regulations on every processed food in which residues could possibly 
concentrate indicates little.
    4. Segregation of crops. One other significant issue raised in 
comments on the NFPA petition relating to EPA's coordination policy was 
the argument that a coordination policy was not justified because 
farmers could segregate crops between the fresh and processed markets. 
EPA believes that this argument is a valid criticism of the 
coordination policy only if it could be shown that segregation is 
generally possible across the entire agriculture industry. If not, 
claims that a specific crop can be segregated relate solely to the 
wisdom of applying the coordination policy in a particular instance 
rather than to the rationale for the underlying coordination policy. 
EPA believes that whether segregation can occur for a specific crop is 
an issue best examined on a case-by-case basis.
    EPA believes that the comments it received in response to the NFPA 
petition demonstrate that segregation of crops for fresh markets is not 
generally possible. Those commenters most aggressively asserting that 
segregation was possible did not represent agricultural interests but 
chemical companies. Even among chemical companies, such as the National 
Agricultural Chemicals Association, however, there was recognition that 
market separation was not always a possibility. Comments from growers, 
for the most part, support EPA's own experience that in many instances 
farmers do not and cannot know in which market a crop will eventually 
be sold. Although some growers representing certain crops in specific 
regions of the country claim in their comments that market segregation 
is possible in their unique circumstances, comments from other growers 
emphasize that a decision about marketing is a product of factors 
beyond their control. Comments to this effect were received from the 
North Carolina Farm Bureau, the California Tree and Grape Association, 
Sun-Diamond Co., and an apple processor. Several commenters, while 
noting the general difficulty of market segregation and thus their 
general approval of the coordination policy, suggested that EPA should 
grant exceptions to the policy where the circumstances show segregation 
possible (State of California, Virginia Agriculture Department, Florida 
Agriculture Department, Farmer Cooperative).
    As noted in the June 1995 NFPA Response, EPA will consider whether 
crops can be segregated between the fresh and processed market on a 
case-

[[Page 2383]]
by-case basis in deciding whether a section 409 FAR is needed.

B. Regulation of Pesticides Under Section 406

    In comments that NFPA provided in response to the notice published 
by EPA, NFPA retreated in its challenge to the coordination policy. 
Instead of arguing that coordination by the Agency of its various 
statutory authorities was illegal, NFPA asserts that EPA's real error 
had been in construing section 409 to cover pesticides in processed 
food. Pesticides in processed foods should be regulated under FFDCA 
section 406, NFPA argues, and it raises no objection to EPA requiring 
section 406 tolerances ``if there is a substantial likelihood that an 
appreciable quantity of concentrated processed food when ready to eat 
will contain residues significantly in excess of the raw product 
tolerance.'' (Comments of NFPA at 32).
    Response to this comment first requires an explanation of section 
406 in the FFDCA. Section 406 was enacted in 1938 and was the original 
provision in the FFDCA granting FDA tolerance-setting authority for 
pesticide residues in food. It provides that FDA may set tolerances for 
``poisonous or deleterious substances added to food'' where such 
substances are required in the production of food. 21 U.S.C. 346. 
Section 406 was rendered obsolete for pesticides in raw agricultural 
commodities by the passage of section 408 in 1954. Congress in passing 
section 408, however, noted, in legislative history, that pesticides in 
processed foods were still to be governed under section 406. With the 
passage of the section 409 food additives provision in 1958, FDA, and, 
in turn, EPA, discerned a change in congressional intent and began to 
regulate pesticides in processed food under section 409. The principal 
basis for that interpretation was the fact that the flow-through 
provision of section 402, added in connection with section 409, 
exempted pesticide residues in processed food that were below the 
appropriate RAC tolerance from section 409. FDA and EPA reasoned that 
Congress would not have exempted such pesticide residues from section 
409 unless they would have fallen within that provision in the absence 
of the exemption provided by section 402. That interpretation has been 
upheld. United States v. Ewig Bros. Co., Inc., 502 F.2d 715, 722 (7th 
Cir. 1974).
    NFPA challenges that interpretation relying on two statutory bases. 
First, NFPA points to the definition of ``food additive'' which 
specifically exempts from the coverage of that term (1) ``a pesticide 
chemical in or on any raw agricultural commodity;'' and (2) pesticide 
chemicals . . . used in the production, storage, transportation of raw 
agricultural commodities.'' NFPA argues that if these two exclusions 
are not to be construed as redundant, the latter must extend to 
pesticides in foods other than RACs -- i.e. pesticides in processed 
foods. Second, NFPA notes that the flow-through provision is drafted so 
as to exclude pesticide residues in processed foods below the RAC 
tolerance not only from section 409 but from section 406 as well. Thus, 
NFPA argues, the flow-through provision, rather than providing a clear 
signal that pesticides in processed foods are food additives, is 
ambiguous on this question.
    The Ninth Circuit in Les v. Reilly wrote that ``the statute 
unambiguously provides that pesticides which concentrate in processed 
food are to be treated as food additives . . . .'' Les v. Reilly, 968 
F.2d at 989. Similarly, the Seventh Circuit in United States v. Ewig 
Bros. Co., Inc. 502 F.2d at 723, decision found it ``clear'' that 
section 409 governed pesticide residues in processed food. Even EPA, in 
arguing in its Order adopting a de minimis exception that there was 
considerable confusion in Congress in 1958 regarding whether section 
409 would apply to pesticides, noted that there is support for the 
interpretation that pesticides in processed foods are ``food 
additives.'' (February 25, 1991; 56 FR 7763) It must be noted, however, 
that neither the Ninth nor Seventh Circuits addressed the exclusion in 
the food additive definition for pesticides ``used'' in the production 
of RACs or the references in the flow-through provision to both 
sections 406 and 409. Nonetheless, at best, NFPA's argument 
demonstrates no more than a possible ambiguity as to whether Congress 
intended pesticides in processed foods to be regulated under section 
406 or 409. See 57 FR 20841 (May 12, 1992) discussing ambiguity in the 
statute.
    In circumstances where the ambiguity of the statute allows for more 
than one reasonable interpretation, the agency charged with the 
administration of the statute is entitled to considerable deference on 
its policy judgment as to which interpretation best furthers the goals 
of the statute. Chevron v. NRDC, 467 U.S. 837, 842-843 (1984). FDA's 
judgment when section 409 was enacted, as well as both FDA's and EPA's 
operating premise for the last 37 years, has been that regulating 
pesticides in processed food is best accomplished under section 409.
    Adopting NFPA's section 406 approach would certainly be a step 
backward in the evolution of the FFDCA as an effective regulatory 
statute. Section 406 was Congress' first effort in conferring 
tolerance-setting authority. It had several weaknesses, one of which 
was that for covered substances such as pesticides, where FDA had not 
set a tolerance, FDA could only successfully remove a food containing 
pesticide residues from commerce by proving before a jury as a matter 
of fact that the food was injurious to health. This scheme was 
abandoned in sections 408 and 409 which make food containing a 
pesticide or food additive adulterated as a matter of law if there is 
no tolerance established for the pesticide or food additive. As the 
Seventh Circuit recognized, if EPA were to return pesticides in 
processed foods to the jurisdiction of section 406, it ``would result 
in the anomaly that a chemical such as DDT [for which there are no 
tolerances] would adulterate all raw fish, but adulteration of 
processed fish would be determined on an uncertain case-by-case 
basis.'' Ewig Bros., 502 F.2d at 722.
    Certainly, the different standards in sections 408 and 409 have 
made the statutory scheme difficult to administer, and the Delaney 
clause has the potential of removing some beneficial pesticide uses 
from the market even though these uses appear to pose negligible human 
cancer risks. By this policy statement, the June 1995 NFPA Response, 
and related actions, however, EPA will have clarified to a large extent 
how it will administer and coordinate action between sections 408 and 
409, which should ease the administration of the provisions. Further, 
the potentially disruptive effect of the Delaney clause on agriculture 
is uncertain. Thus, even if NFPA is correct that Congress expressed no 
clear intent on what provision should govern pesticide residues in 
processed food and therefore EPA may regulate residues in processed 
food under either section 406 or 409, EPA declines to change from its 
current practice of regulating such residues under section 409 for the 
reasons stated above.

VI. The Relationship of Decisions Regarding the Need for Section 409 
FARs and Delaney Clause Determinations

    The NFPA Petition II requests that EPA implement its new 
concentration policy as soon as possible by initiating revocation 
proceedings for all section 409 FARs now deemed unnecessary. The 
petition asserts that such revocation proceedings are likely to be less 


[[Page 2384]]
resource intensive than revocations based on the Delaney clause. 
Further, the petition claims that EPA is barred by the FFDCA from 
revoking a FAR under the Delaney clause or any other safety-related 
grounds prior to reevaluating under its revised concentration policy 
whether the FAR is necessary.
    As a policy matter, EPA generally agrees that it makes sense to 
revoke FARs, where appropriate, as unnecessary rather than to litigate 
the difficult science questions involved in an induce cancer finding. 
For that reason, EPA has consistently revoked FARs that otherwise were 
barred by the Delaney clause on lack of need grounds where it was clear 
that such grounds supported revocation. (See mancozeb on raisins, June 
30, 1994; 59 FR 33694, and trifluralin on mint, July 28, 1995; 60 FR 
38781.) However, EPA strongly disagrees with NFPA's suggestion that the 
statute has established a hierarchy of grounds for the revocation of 
FARs that subordinates the public health concerns embodied in the 
safety standard in section 409 to a determination of whether residues 
above the section 408 tolerance are expected. After reviewing the legal 
arguments put forward by NFPA, EPA concludes they are without basis.
    NFPA's argument is as follows:

    As a matter of law, EPA is precluded from applying the Delaney 
clause to pesticides that come within the provisions of the flow-
through proviso in section 402(a)(2). That proviso flatly prohibits 
EPA from determining that an agricultural pesticide in a processed 
food is ``unsafe,'' notwithstanding the provisions of section 409, 
if the residue has been removed to the extent possible in good 
manufacturing practice and the concentration of the residue in the 
processed food when ready to eat is not greater than the raw 
commodity tolerance. Yet, if EPA were to revoke a section 409 
tolerance because the pesticide is found to induce cancer within the 
meaning of the Delaney clause, the statutory basis of that action 
would necessarily be that the pesticide is ``unsafe'' under the 
terms of section 409 and section 402(a)(2)(C). NFPA Petition II at 3 
(footnote omitted).

    EPA agrees with NFPA that EPA cannot declare a pesticide residue 
that complies with the flow-through provision ``unsafe'' as that term 
is used in section 402(a)(2)(C). However, EPA disagrees that revoking a 
section 409 FAR on safety grounds could have the effect of rendering 
residues in compliance with the flow-through provision ``unsafe'' under 
section 402(a)(2)(C). Revocation of a FAR for whatever reason can only 
affect residues in food exceeding the section 408 tolerance. Residues 
in processed food below the section 408 tolerance are, by order of the 
flow-through provision, not ``unsafe'' within the meaning of section 
409. EPA's conclusion, in revoking a FAR, that residues exceeding the 
section 408 tolerance do not meet the safety standard in section 409(c) 
is not meant to, and, for that matter, cannot change the operation of 
the flow-through provision as to residues below the section 408 
tolerance.
    NFPA's argument is based on two fundamental misreadings of the 
statute. First, NFPA apparently misunderstands the relationship between 
section 409 FARs and section 402(a)(2)(C) including the flow-through 
provision. NFPA appears to believe that revocation of a section 409 FAR 
somehow affects residues governed by the flow-through provision. 
Second, NFPA wrongly treats as comparable the ``unsafe'' determination 
under section 402(a)(2)(C) and the safety finding required in section 
409(c) regarding the establishment or revocation of FARs. A correct 
reading of the statute on either of these two points shows the flaw in 
NFPA's argument. Below, EPA has set out in detail an explanation of the 
proper interpretation of the interrelationship between section 402 and 
section 409.
    FARs for food additives, including pesticide residues in processed 
food, are established under section 409. Section 402(a)(2)(C) makes 
these FARs enforceable by defining the circumstances under which a food 
containing a food additive is adulterated.
    The key to the operation of sections 402(a)(2)(C) and 409 is the 
statutory phrase ``unsafe within the meaning of section 409.'' Section 
402(a)(2)(C) declares that a food containing a food additive is 
adulterated if the food additive is ``unsafe within the meaning of 
section 409.'' Subsection (a) of section 409 reciprocates this 
crossreference from section 402(a)(2)(C) by stating:

    [a] food additive shall . . . be deemed to be unsafe for the 
purposes of the application of clause (2)(C) of section 402(a), 
unless . . . there is in effect, and it and its use or intended use 
are in conformity with, a regulation issued under this section . . . 
. 21 U.S.C. 348(a).

    Thus, section 409(a) defines ``unsafe within the meaning of section 
409'' by means of a mechanical per se rule -- a food additive is 
``unsafe'' and renders food adulterated unless the additive is in 
compliance with a FAR and, where no FAR exists, a food additive is 
necessarily unsafe. The preeminence of a FAR in adjudicating whether a 
food additive is ``unsafe'' under section 402(a)(2)(C) is confirmed by 
the closing sentence of section 409(a) which forbids enforcement action 
against a food additive under a substantive safety standard 
(``injurious to health'') if a FAR has been established.
    Unlike the adulteration determination under section 402(a)(2)(C), 
the process for establishing, modifying, and revoking FARs does involve 
substantive safety determinations. Subsection (c) of section 409 states 
FARs shall not be promulgated unless ``use of the food additive, under 
the conditions of use to be specified in the regulation, will be safe . 
. . .'' Subsection (c) then lists numerous factors to be considered in 
making this substantive safety determination. 21 U.S.C. 348(c)(5).
    The final wrinkle in the section 402/409 scheme is the flow-through 
provision in section 402(a)(2)(C). The flow-through provision places an 
important limitation on the application of the per se ``unsafe'' rule 
of section 409(a) in situations where no FAR has been established for a 
pesticide residue in a processed food. The flow-through provision 
specifies that pesticide residues in processed foods are not deemed 
unsafe within the meaning of section 409 where, among other things, 
such residues are in conformity with the section 408 tolerance 
established for the precursor raw agricultural commodity. Thus, section 
402(a)(2)(C) creates, in essence, two regulatory zones for any 
particular pesticide in food. The first zone covers the range of 
residues from zero up to the section 408 tolerance. The second zone 
applies to all levels of residue exceeding the section 408 tolerance. 
In the first zone, pesticide residues are statutorily removed from 
section 409(a)'s per se ``unsafe'' rule. In the second zone, residues 
are per se ``unsafe'' and render food adulterated as a matter of law 
(i.e. no particularized safety finding required) unless EPA has 
established a FAR finding such level of residues to be substantively 
``safe'' under section 409(c). Such FARS permitting residues in zone 
two apply, in effect, only to residues in zone two because if a FAR is 
revoked, residues in zone one would once again enjoy the protection of 
the flow-through provision.
    Thus, it is clear that the revocation of a FAR under the section 
409(c) safety standard only affects residues in processed food above 
the section 408 tolerance (zone two residues) and not residues within 
the flow-through provision (zone one residues). This is true even where 
residues of a pesticide in processed food do not exceed the section 408 
tolerance. Whether or not residues in fact exceed the section 408 
tolerance, the presence of a section 409 

[[Page 2385]]
FAR legalizes such residues and revocation of the FAR can do nothing 
more than remove the allowance for such overtolerance residues. NFPA 
has offered no explanation for how the factual circumstances 
surrounding the residue levels of a certain pesticide could serve to 
rewrite the statutory provisions governing the legal effect of the 
revocation of a FAR.
    Further, it is also clear that the safety finding under section 
409(c) is entirely distinct from the ``unsafe'' determination under 
section 402(a)(2)(C). Section 409(c) involves a substantive safety 
evaluation, section 402(a)(2)(C) is a mechanical test for adulteration 
which involves nothing more than evaluating compliance with a FAR. 
Although a lack of safety finding under section 409(c) has an effect on 
how the mechanical ``unsafe'' test under section 402(a)(2)(C) will 
operate as to residues in zone two (once a FAR is revoked residues in 
zone two become ``unsafe'' as a matter of law), such a finding would 
have absolutely no legal effect on residues in zone one. Thus, NFPA is 
wrong to treat the lack of safety finding under section 409(c) as 
equivalent to a section 402(a)(2)(C) ``unsafe'' determination.
    Unwittingly, NFPA's attempt to blur the distinction between the 
determinations in the FAR-setting process and the FAR enforcement 
process threatens to undermine Congress' carefully constructed scheme 
for the regulation of food additives and several other substances 
(pesticides in raw foods, new animal drugs, and color additives) which 
are regulated under the FFDCA under an identical scheme. As it now 
stands, section 402(a)(2) imposes a straightforward test: a pesticide, 
food additive, new animal drug, or color additive renders a food 
adulterated unless the present of the substance is consistent with a 
tolerance or use regulation promulgated under the applicable section of 
the FFDCA. If, however, the ``unsafe'' determination under section 
402(a)(2)(C) has a substantive safety component, as advocated by NFPA, 
FFDCA tolerance or use regulations potentially lose their status as the 
ultimate arbiter over whether a food is adulterated. The consequence 
would be that proof that a food containing pesticide residues not in 
compliance with a FAR would not necessarily suffice to justify seizure 
of the food by FDA; nor would a showing that residues of a pesticide in 
food are within the FAR necessarily protect the food from a finding of 
adulteration. This lack of clarity concerning the legality of the 
residues of pesticides, food additives, new animal drugs, and color 
additives serves neither the public nor the regulated community. For 
this reason alone, NFPA's argument would have to be rejected.
    In sum, NFPA's argument that EPA is legally barred from revoking a 
FAR on safety grounds prior to revisiting the need for the FAR has no 
basis in the statute. The premise of NFPA's argument -- that the 
revocation of a FAR on safety grounds somehow automatically overrides 
the flow-through provision -- is conceptually flawed. EPA has never 
claimed that its administrative determinations under section 409(c) 
disable the statutory command in the flow-through provision and NFPA 
has supplied no reasonable argument as to why such EPA determinations 
should have such effect. If a section 409 FAR is revoked on safety 
grounds, EPA will have to evaluate whether the corresponding section 
408 tolerance, and the protection it provides to certain residues in 
processed food, should remain in place. However, the determination on 
the section 408 tolerance, as explained in Unit V. of this document, 
will turn on the safety standard in section 408 and not automatically 
follow from any safety finding under section 409(c).

VII. Potential Impacts on Agriculture Related to EPA's Coordination and 
Concentration Policies

    In connection with its response to the NFPA petition, EPA conducted 
an Economic Impact Assessment as to potential impacts on agricultural 
producers as a result of continuation of EPA's existing policies 
without change. The assessment concluded that the total economic impact 
on affected producers could be as high as $500 million. The assessment 
concluded that some potentially significant impacts could occur on a 
small number of crops, but only three crops are estimated to incur 
impacts greater than 5 percent of their annual 1989-91 U.S. production 
value (pineapple 29%, sugarcane 13%, and grapes 5.1%). Absolute 
projected impacts were highest for sugarcane, grapes, potatoes, rice, 
and apples, which together comprised about 70 percent of total impacts 
projected.
    For various reasons, however, the assessment presents a worst-case 
scenario and actual impacts are expected to be far less. The assessment 
did not take into account the changes in EPA's coordination and 
concentration policies adopted in this document and the June 1995 NFPA 
Response; rather, it assumed that all pesticide uses identified as 
potentially affected by the Delaney clause and EPA's coordination 
policy would be cancelled. As the recent proposed revocation of animal 
feed regulations (September 15, 1995; 60 FR 49142) illustrates, these 
revised policies have already reduced the number of uses potentially 
affected. Nor did the assessment consider other factors expected to 
mitigate impacts: (1) Only currently registered alternatives were 
assumed to be available for substitution, whereas FIFRA sec. 18 
exemptions and section 24(c) registrations for alternative pesticides 
could avert significant impacts; (2) any cancellations of uses are 
likely to be phased in over several years rather than immediately and 
simultaneously.
    Until new policy definitions and parameters are fully implemented, 
the extent of impact mitigation due to recent policy modifications 
cannot be predicted but the decrease in potential impacts is expected 
to be significant. EPA will update its Economic Impact Analysis when it 
evaluates remaining uses potentially affected by the Delaney clause.

VIII. Regulatory Assessment Requirements

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), it has 
been determined that this policy statement is a ``significant 
regulatory action'' because this action may raise novel policy issues 
arising out of legal mandates. As such, this action was submitted to 
the Office of Management and Budget for review and any comments or 
changes have been documented in the public record. This action 
reaffirms existing policy and has no direct adverse impacts on any 
entity, including small entities. I therefore certify that this policy 
statement does not require a separate Impact Analysis under the 
Regulatory Flexibility Act.

List of Subjects

    Environmental protection, Administrative practice and procedure, 
Agricultural commodities, Feed additives, Food additives, Pesticides 
and pests, Reporting and recordkeeping requirements.

    Dated: January 19, 1996.
Lynn R. Goldman,
Assistant Administrator for Prevention, Pesticides and Toxic 
Substances.

[FR Doc. 96-1212 Filed 1-22-96; 3:59 pm]
BILLING CODE 6560-50-F

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