This section of the FEDERAL REGISTER

contains regulatory documents having general

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are keyed to and codified in the Code of

Federal Regulations, which is published under

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Rules and Regulations Federal Register

45153 

Vol. 73, No. 150 

Monday, August 4, 2008 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 981 

[Docket No. AO–214–A7; AMS–FV–07–0050; 

FV07–981–1] 

Almonds Grown in California; Order 

Amending Marketing Order No. 981 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: This final rule amends the 

marketing order for almonds grown in 

California. The amendments were 

proposed by the Almond Board of 

California (Board), which is responsible 

for local administration of the order. 

The amendments will authorize the 

establishment of different outgoing 

quality requirements for different 

markets and authorize the establishment 

of bulk container marking and labeling 

requirements. The amendments are 

intended to provide additional 

flexibility in administering the quality 

control provisions of the order and 

provide the industry with additional 

tools for the marketing of almonds. 

DATES: This rule is effective August 5, 

2008. 

FOR FURTHER INFORMATION CONTACT: 

Martin Engeler, Marketing Order 

Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA, 2202 

Monterey Street, Suite 102–B, Fresno, 

California 93721; Telephone: (559) 487– 

5110, Fax: (559) 487–5906, or E-mail: 

Martin.Engeler@usda.gov; or Laurel 

May, Marketing Order Administration 

Branch, Fruit and Vegetable Programs, 

AMS, USDA, 1400 Independence 

Avenue, SW., Stop 0237, Washington, 

DC 20250–0237; Telephone: (202) 720– 

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

Laurel.May@usda.gov. 

Small businesses may request 

information on this proceeding by 

contacting Jay Guerber, Marketing Order 

Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA, 1400 

Independence Avenue, SW., Stop 0237, 

Washington, DC 20250–0237; 

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

720–8938, or e-mail: 

Jay.Guerber@usda.gov. 

SUPPLEMENTARY INFORMATION: Prior 

documents in this proceeding: Notice of 

Hearing issued on June 29, 2007, and 

published in the July 6, 2007, issue of 

the Federal Register (72 FR 36900); a 

Recommended Decision issued on 

December 21, 2007, and published in 

the December 28, 2007, issue of the 

Federal Register (72 FR 73671); and a 

Secretary’s Decision and Referendum 

Order issued on February 27, 2008, and 

published in the March 3, 2008, issue of 

the Federal Register (73 FR 11360). 

This action is governed by the 

provisions of sections 556 and 557 of 

Title 5 of the United States Code and is 

therefore excluded from the 

requirements of Executive Order 12866. 

Preliminary Statement 

This final rule was formulated on the 

record of a public hearing held on 

August 2, 2007, in Modesto, California. 

Notice of this hearing was issued on 

June 29, 2007, and published in the July 

6, 2007, issue of the Federal Register 

(72 FR 36900). The hearing was held to 

consider the proposed amendment of 

Marketing Order No. 981, hereinafter 

referred to as the ‘‘order’’. 

The hearing was held pursuant to the 

provisions of the Agricultural Marketing 

Agreement Act of 1937, as amended (7 

U.S.C. 601–674), hereinafter referred to 

as the ‘‘Act,’’ and the applicable rules of 

practice and procedure governing the 

formulation of marketing agreements 

and marketing orders (7 CFR part 900). 

The Notice of Hearing contained two 

amendment proposals submitted by the 

Almond Board of California (Board), 

which is responsible for local 

administration of the order. Upon the 

basis of evidence introduced at the 

hearing and the record thereof, the 

Administrator of AMS on December 21, 

2007, filed with the Hearing Clerk, U.S. 

Department of Agriculture, a 

Recommended Decision and 

Opportunity to File Written Exceptions 

thereto by January 17, 2008. No 

exceptions were filed. 

A Secretary’s Decision and 

Referendum Order was issued on 

February 27, 2008, directing that a 

referendum be conducted during the 

period March 24 through April 11, 2008, 

among almond growers to determine 

whether they favored the proposed 

amendments to the order. To become 

effective, the amendments had to be 

approved by at least two-thirds of those 

producers voting or by voters 

representing at least two-thirds of the 

volume of almonds represented by 

voters in the referendum. Each of the 

two proposed amendments were favored 

by at least 80 percent of the voters 

voting in the referendum. 

The amendments approved by voters 

and included in this order will: 

1. Authorize the establishment of 

different outgoing almond quality 

requirements for different markets; and 

2. Authorize the establishment of 

container marking and labeling 

requirements. 

The U.S. Department of Agriculture 

(USDA) also proposed to allow such 

changes as may be necessary to the 

order so that all of the order’s provisions 

conform to the effectuated amendments. 

None were deemed necessary. 

An amended marketing agreement 

was subsequently provided to all 

almond handlers in the production area 

for their approval. The marketing 

agreement was not approved by 

handlers representing at least 50 percent 

of the volume of almonds handled by all 

handlers during the representative 

period of August 1, 2006, through July 

31, 2007. 

Small Business Consideration 

Pursuant to the requirements set forth 

in the Regulatory Flexibility Act (RFA) 

(5 U.S.C. 601–612), AMS has considered 

the economic impact of this action on 

small entities. Accordingly, AMS has 

prepared this final regulatory flexibility 

analysis. 

The purpose of the RFA is to fit 

regulatory actions to the scale of 

business subject to such actions so that 

small businesses will not be unduly or 

disproportionately burdened. Marketing 

orders and amendments thereto are 

unique in that they are normally 

brought about through group action of 

essentially small entities for their own 

benefit. 

Small agricultural service firms, 

which include handlers regulated under 

the order, have been defined by the 

Small Business Administration (SBA) 

(13 CFR 121.201) as those having annual 


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receipts of less than $6,500,000. Small 

agricultural producers have been 

defined as those with annual receipts of 

less than $750,000. 

There are approximately 104 handlers 

of almonds subject to regulation under 

the order and approximately 6,000 

producers of almonds in the regulated 

area. Information provided at the 

hearing indicates that approximately 50 

percent of the handlers would be 

considered small agricultural service 

firms. According to data reported by the 

National Agricultural Statistics Service 

(NASS), the two-year average crop value 

for 2005–06 and 2006–07 was $2.283 

billion. Dividing that average by 6,000 

producers yields average estimated 

producer revenues of $380,500, which 

suggests that the majority of almond 

producers would also be considered 

small entities according to the SBA’s 

definition. 

The order regulates the handling of 

almonds grown in the state of 

California. The California almond 

bearing acreage increased nearly 40 

percent between 1996 and 2006, from 

418,000 to 585,000 acres. 

Approximately 1.115 billion pounds 

(shelled basis) of almonds were 

produced during the 2006–07 season. 

Bearing acreage for the 2007–08 season 

is estimated to be 615,000 acres. NASS 

has forecasted that the 2007–08 crop 

will reach 1.330 billion pounds (shelled 

basis). More than two thirds of 

California’s almond crop is exported to 

approximately 90 countries worldwide, 

and comprises nearly 80 percent of the 

world’s almond supply. 

Under the order, incoming and 

outgoing quality regulations are 

established, statistical information is 

collected, production research projects 

are conducted, and marketing research 

and generic promotion programs are 

sponsored. Program activities 

administered by the Board are designed 

to support large and small almond 

producers and handlers. The 10-member 

Board is comprised of both producer 

and handler representatives from the 

production area. Board meetings where 

regulatory recommendations and other 

decisions are made are open to the 

public. All members are able to 

participate in Board deliberations, and 

each Board member has an equal vote. 

Others in attendance at meetings are 

also allowed to express their views. 

The Board’s Food Quality and Safety 

Committee discussed the need for 

amendments to the order at meetings 

held on May 12, 2005; July 20, 2005; 

and November 1, 2006. The Board 

approved language for two proposed 

amendments to the order at their 

meeting on November 28, 2006. During 

a conference call on February 27, 2007, 

the Board confirmed that the two 

amendments should be proposed to 

USDA. The views of all participants 

were considered throughout this 

process. 

In addition, the hearing to receive 

evidence on the proposed changes was 

open to the public and all interested 

parties were invited and encouraged to 

participate and provide their views. 

The amendments are intended to 

provide the Board and the industry with 

additional flexibility in the marketing of 

California almonds. Record evidence 

indicates that the amendments are 

intended to benefit all producers and 

handlers under the order, regardless of 

size. There are no cost implications for 

handlers or growers from adding the 

new order authorities. Costs of 

implementation will be incurred only if 

specific additional requirements are 

established following future informal 

rulemaking. All grower and handler 

witnesses supported the amendments 

and commented on the implications of 

implementing specific requirements in 

the future. In that context, witnesses 

stated that they expected the benefits to 

be substantial and the costs of any 

future requirements to be minimal. 

A description of the amendments and 

their anticipated economic impact on 

small and large entities is discussed 

below. 

Proposal 1—Adding the Authority To 

Establish Different Outgoing Quality 

Requirements for Different Markets 

The record shows that the amendment 

adding authority to establish different 

outgoing quality requirements for 

different markets will, in itself, have no 

economic impact on producers or 

handlers of any size. Regulations 

implemented under that authority could 

impose additional costs on handlers 

required to comply with them. 

However, witnesses testified that 

establishing mandatory regulations for 

different markets could increase the 

industry’s credibility and reduce the 

risk that shipments of substandard 

product could jeopardize the entire 

industry’s reputation. Record evidence 

shows that any additional costs are 

likely to be offset by the benefits of 

complying with those requirements. 

Witnesses cited decreased delays and 

demurrage charges, as well as fewer 

rejected loads and increased customer 

confidence, as expected benefits. 

Recently, almonds have been rejected in 

the EU due to aflatoxin levels exceeding 

its importing tolerances. Information 

provided at the hearing shows that the 

rejection of a 44,000 pound container of 

almonds in the EU costs about $10,000, 

or 22.7 cents per pound. The cost 

includes demurrage for unanticipated 

delays at port, warehousing product 

while awaiting official import testing 

results, shipping rejected almonds back 

to the U.S., and shipping a replacement 

container back to the EU. 

To reduce the risk of rejections, the 

California almond industry developed a 

voluntary aflatoxin testing protocol. 

Witnesses estimated that the cost of the 

pre-export testing, including the value 

of the sample, analytical fees, courier 

fees, and sampling labor is less than 2 

cents per pound, which is less than 10 

percent of the cost associated with a 

rejection. Proponents testified that if a 

requirement that all almonds destined 

for the EU be tested prior to shipment 

was established under authority 

provided by the order amendment, 

handlers would incur the cost of testing, 

but those costs would be expected to be 

more than offset by the reduced risk of 

rejections. 

It’s likely that most handlers are 

already complying with their customers’

specific market requirements on a 

voluntary basis as a part of doing 

business, but witnesses explained that 

mandatory requirements lend credibility 

to the entire industry. In addition, such 

requirements could reduce the risk that 

one shipment of substandard product 

would jeopardize the entire industry’s 

reputation. 

Currently, outgoing quality 

requirements established under the 

order apply to all handler entities 

regardless of size. If regulations are 

established pursuant to this 

amendment, distribution of any 

increased costs between small and large 

entities would depend on the 

requirements established for the markets 

to which individual handlers shipped 

their almonds as well as the volume of 

almonds shipped to those markets. But 

increases in cost would be equitable to 

all entities because requirements for 

each market would be imposed 

uniformly on all handlers shipping to 

that market. 

Witnesses explained that almonds are 

used in many different ways by the 

various markets. In Europe, almonds are 

widely used as marzipan and 

ingredients for baked goods, candy, and 

other dishes. In India and the Middle 

East, almonds are presented as gifts at 

holidays and weddings, and play a part 

in other cultural traditions. India 

imports large quantities of inshell 

almonds that are then processed by 

hand. The wide range of uses leads to 

a similarly wide array of customer 

requirements. 

According to record testimony, 

handlers adapt their export methods to 


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satisfy customer requirements. One 

witness explained that it is often 

difficult for smaller handlers to stay 

informed of rapidly changing import 

regulations. The witness stated that 

small handlers in particular would 

benefit from the authority to establish 

different requirements for different 

markets by avoiding costly mistakes that 

could be associated with not 

understanding various market and 

import requirements. If regulations are 

established under this amendment, the 

Board will provide information about 

updated requirements to the industry. 

Finally, one witness explained that 

having the ability under the order to 

establish different outgoing quality 

requirements for different markets will 

not restrict handlers’ choices regarding 

which markets to supply. Rather, the 

provision will ensure that the important 

standards that differentiate markets will 

be consistently met by all handlers 

shipping to those markets. 

Proposal 2—Adding the Authority To 

Establish Container Labeling and 

Marking Requirements 

The second amendment adds § 981.43 

to the order to provide general authority 

to establish container marking and 

labeling requirements. This amendment 

will allow the Board, through the 

informal rulemaking process, to 

recommend and establish uniform 

container marking and labeling 

regulations in response to evolving 

market requirements. Under previous 

order provisions, there is only very 

limited authority for container marking 

and labeling requirements. 

Witnesses testified that the lack of 

this authority has hindered them from 

adapting quickly and appropriately to 

recent market situations. In one case 

described at the hearing, the industry 

was unable to implement container 

marking or labeling following recalls for 

possible Salmonella contamination. 

Witnesses stated that customer 

confidence in almond quality could 

have been reinforced if the necessary 

authority to establish marking and 

labeling requirements had been 

available. Such authority would have 

allowed the industry to prescribe 

labeling to clearly indicate which 

almonds had been treated to reduce risk 

of contamination. 

The amendment will allow the 

industry to respond to evolving market 

needs as they develop by establishing 

uniform and consistent marking and 

labeling requirements. According to 

proponents, the ability to communicate 

important product information to 

customers in a uniform and consistent 

manner will be essential as the industry 

strives to maintain its position in the 

expanding global marketplace. 

If regulations are implemented 

pursuant to this amendment, costs of 

complying with any regulations 

established thereunder will not be 

disproportionate to small businesses. 

Witnesses testified that applying labels 

and marks to almond containers is 

currently a common practice, and 

industry handlers already have 

container marking processes and 

equipment in place. Therefore, the costs 

associated with the addition of uniform 

marking or labeling requirements will 

be minimal for both small and large 

entities. The record shows that any costs 

will likely be offset by the benefits 

derived from being more responsive to 

market demands. 

Interested persons were invited to 

present evidence at the hearing on the 

probable regulatory and informational 

impact of the proposed amendments to 

the order on small entities. The record 

evidence indicates that the amendments 

are intended to benefit all producers 

and handlers under the order, regardless 

of size. Further, the record shows that 

the costs associated with implementing 

regulations would be outweighed by the 

benefits expected to accrue to the 

California almond industry. 

USDA has not identified any relevant 

Federal rules that duplicate, overlap or 

conflict with this rule. These 

amendments are designed to enhance 

the administration and functioning of 

the order to the benefit the California 

almond industry. 

Paperwork Reduction Act 

Information collection requirements 

for part 981 are currently approved by 

the Office of Management and Budget 

(OMB), under OMB Number 0581–0178, 

Vegetable and Specialty Crops. 

Implementation of these amendments 

will not trigger any changes to those 

requirements. Should any such changes 

become necessary in the future, they 

will be submitted to OMB for approval. 

As with all Federal marketing order 

programs, reports and forms are 

periodically reviewed to reduce 

information requirements and 

duplication by industry and public 

sector agencies. 

AMS is committed to complying with 

the Government Paperwork Elimination 

Act, which requires Government 

agencies in general to provide the public 

the option of submitting information or 

transacting business electronically to 

the maximum extent possible. 

AMS is committed to complying with 

the E-Government Act, to promote the 

use of the Internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

Civil Justice Reform 

The amendments to Marketing Order 

981 stated herein have been reviewed 

under Executive Order 12988, Civil 

Justice Reform. They are not intended to 

have retroactive effect. The amendments 

will not preempt any State or local laws, 

regulations, or policies, unless they 

present an irreconcilable conflict with 

an amendment. 

The Act provides that administrative 

proceedings must be exhausted before 

parties may file suit in court. Under 

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

handler subject to an order may file 

with USDA a petition stating that the 

order, any provision of the order, or any 

obligation imposed in connection with 

the order is not in accordance with law 

and request a modification of the order 

or to be exempted therefrom. A handler 

is afforded the opportunity for a hearing 

on the petition. After the hearing, USDA 

would rule on the petition. The Act 

provides that the district court of the 

United Sates in any district in which the 

handler is an inhabitant, or has his or 

her principal place of business, has 

jurisdiction to review USDA’s ruling on 

the petition, provided an action is filed 

no later than 20 days after the date of 

the entry of the ruling. 

Order Amending the Order Regulating 

the Handling of Almonds Grown in 

California 

Findings and Determinations 

The findings and determinations set 

forth hereinafter are supplementary and 

in addition to the findings and 

determinations previously made in 

connection with the issuance of the 

order; and all of said previous findings 

and determinations are hereby ratified 

and affirmed, except insofar as such 

findings and determinations may be in 

conflict with the findings and 

determinations set forth herein. 

(a) Findings and Determinations Upon the 

Basis of the Hearing Record. 

Pursuant to the provisions of the 

Agricultural Marketing Agreement Act of 

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

applicable rules of practice and procedure 

effective thereunder (7 CFR part 900), a 

public hearing was held upon the proposed 

amendments to Marketing Order No. 981 (7 

CFR part 981), regulating the handling of 

almonds grown in California. 

Upon the basis of the evidence introduced 

at such hearing and the record thereof, it is 

found that: 

(1) The marketing order, as amended, and 

as hereby further amended, and all of the 

terms and conditions thereof, will tend to 

effectuate the declared policy of the Act; 


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(2) The marketing order, as amended, and 

as hereby further amended, regulates the 

handling of almonds grown in the production 

area in the same manner as, and is applicable 

only to persons in the respective classes of 

commercial and industrial activity specified 

in the marketing order upon which hearings 

have been held; 

(3) The marketing order, as amended, and 

as hereby further amended, is limited in 

application to the smallest regional 

production area which is practicable, 

consistent with carrying out the declared 

policy of the Act, and the issuance of several 

orders applicable to subdivision of the 

production area would not effectively carry 

out the declared policy of the Act; 

(4) The marketing order, as amended, and 

as hereby further amended, prescribes, 

insofar as practicable, such different terms 

applicable to different parts of the production 

area as are necessary to give due recognition 

to the differences in the production and 

marketing of almonds grown in the 

production area; and 

(5) All handling of almonds grown in the 

production area is in the current of interstate 

or foreign commerce or directly burdens, 

obstructs, or affects such commerce. 

(b) Additional Findings. 

It is necessary and in the public interest to 

make these amendments effective not later 

than one day after publication in the Federal 

Register. A later effective date would 

unnecessarily delay implementation of the 

new amendments. These amendments should 

be in place as soon as possible as the new 

crop year begins August 1. Making the 

effective date one day after publication in the 

Federal Register will allow the industry to 

consider regulations implementing the new 

order authorities at the beginning of the new 

crop year, which would be beneficial to the 

industry. 

(c) Determinations. It is hereby determined 

that: 

(1) Handlers (excluding cooperative 

associations of producers who are not 

engaged in processing, distributing, or 

shipping almonds covered by the order as 

hereby amended) who, during the period 

August 1, 2006, through July 31, 2007, 

handled 50 percent or more of the volume of 

such almonds covered by said order, as 

hereby amended, have not signed an 

amended marketing agreement; and, 

(2) The issuance of this amendatory order, 

further amending the aforesaid order, is 

favored or approved by at least two-thirds of 

the producers who participated in a 

referendum on the question of approval and 

who, during the period of August 1, 2006, 

through July 31, 2007 (which has been 

deemed to be a representative period), have 

been engaged within the production area in 

the production of such almonds, such 

producers having also produced for market at 

least two-thirds of the volume of such 

commodity represented in the referendum; 

and 

(3) In the absence of a signed marketing 

agreement, the issuance of this amendatory 

order is the only practical means pursuant to 

the declared policy of the Act of advancing 

the interests of producers of almonds in the 

production area. 

Order Relative to Handling of Almonds 

Grown in California 

It is therefore ordered, that on and 

after the effective dates hereof, all 

handling of almonds grown in 

California shall be in conformity to, and 

in compliance with, the terms and 

conditions of the said order as hereby 

amended as follows: 

The provisions of the proposed order 

further amending the order contained in 

the Secretary’s Decision issued by the 

Administrator on February 27, 2008, 

and published in the Federal Register 

on March 3, 2008 (73 FR 11360), shall 

be and are the terms and provisions of 

this order amending the order and set 

forth in full herein. 

List of Subjects in 7 CFR Part 981 

Almonds, Marketing agreements, 

Nuts, Reporting and recordkeeping 

requirements. 

PART 981—ALMONDS GROWN IN 

CALIFORNIA 

■ For the reasons set forth in the 

preamble, Title 7 of Chapter XI of the 

Code of Federal Regulations is amended 

by amending part 981 to read as follows: 

■ 1. The authority citation for 7 CFR 

part 981 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Amend paragraph (b) of § 981.42 by 

adding the following sentence before the 

last sentence to read as follows: 

§ 981.42 Quality control. 

* * * * * 

(b) * * * The Board may, with the 

approval of the Secretary, establish 

different outgoing quality requirements 

for different markets. * * * 

■ 3. Add a new § 981.43 to read as 

follows: 

§ 981.43 Marking or labeling of containers. 

The Board may, with the approval of 

the Secretary, establish regulations to 

require handlers to mark or label their 

containers that are used in packaging or 

handling of bulk almonds. For purposes 

of this section, container means a box, 

bin, bag, carton, or any other type of 

receptacle used in the packaging or 

handling of bulk almonds. 

Dated: July 30, 2008. 

Lloyd C. Day, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. E8–17827 Filed 8–1–08; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 25 

[Docket No. NM390; Special Conditions No. 

25–372–SC] 

Special Conditions: Embraer S.A., 

Model ERJ 190–100 ECJ Airplane; Fire 

Protection 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Final special conditions. 

SUMMARY: These special conditions are 

issued for the Embraer S.A., Model ERJ 

190–100 ECJ airplane. This airplane has 

a novel or unusual design feature, in 

that it features multiple electrical/ 

electronic equipment bays that are 

located throughout the airplane. The 

applicable airworthiness regulations do 

not contain adequate or appropriate 

safety standards for this design feature. 

These special conditions contain the 

additional safety standards that the 

Administrator considers necessary to 

establish a level of safety equivalent to 

that established by the existing 

airworthiness standards. 

DATES: Effective Date: September 3, 

2008. 

FOR FURTHER INFORMATION CONTACT: 

Stephen Happenny, FAA, Propulsion/ 

Mechanical Branch, ANM–112, 

Transport Airplane Directorate, Aircraft 

Certification Service, 1601 Lind 

Avenue, SW., Renton, Washington 

98057–3356; telephone 425–227–2147; 

facsimile 425–227–1232. 

SUPPLEMENTARY INFORMATION: 

Background 

Embraer S.A., made the original 

application for certification of the 

Model ERJ 190 on May 20, 1999. The 

Embraer application includes six 

different models, the initial variant 

being designated as the Model ERJ 190–

100. The application was submitted 

concurrently with that for the Model 

ERJ 170–100, which received an FAA 

type certificate (TC) on February 20, 

2004. Although the applications were 

submitted as two distinct TCs, the 

airplanes share the same conceptual 

design and general configuration. On 

July 2, 2003, Embraer S.A., submitted a 

request for an extension of its original 

application for the Model ERJ 190 

series, with a new application date of 

May 30, 2001, for establishing the type 

certification basis. The FAA 

certification basis was adjusted to reflect 

this new application date. In addition, 

Embraer has elected to voluntarily 


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