65598 Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations

Food components 1 Age 1 and 2 Age 3 through 5 Age 6 through 12 2 Adult participants

*******

Meat and Meat Alternates:

Lean meat or poultry or fish 6 or ................................. 1⁄2 ounce ............... 1⁄2 ounce ............... 1 ounce ................. 1 ounce

Alternate protein products 7 or .................................... 1⁄2 ounce ............... 1⁄2 ounce ............... 1 ounce ................. 1 ounce

Cheese or .................................................................... 1⁄2 ounce ............... 1⁄2 ounce ............... 1 ounce ................. 1 ounce

*******

1For purposes of the requirements outlined in this subsection, a cup means a standard measuring cup.

2 Children age 12 and up may be served adult size portions based on the greater food needs of older boys and girls, but shall be served not

less than the minimum quantities specified in this section for children age 6 up to 12.

*****

6Edible portions must be served.

7 Must meet the requirements in Appendix A of this part.

*****

Dated: December 7, 2001.

George A. Braley,

Acting Administrator, Food and Nutrition

Service.

[FR Doc. 01–31161 Filed 12–19–01; 8:45 am]

BILLING CODE 3410–30–U

DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection

Service

9 CFR Parts 71 and 85

[Docket No. 98–023–2]

RIN 0579–AB28

Interstate Movement of Swine Within a

Production System

AGENCY: Animal and Plant Health

Inspection Service, USDA.

ACTION: Final rule.

SUMMARY: We are amending the

regulations to establish an alternative to

the current requirements for moving

swine interstate. Under this alternative,

persons may move swine interstate

without meeting individual swine

identification and certain other

requirements if they move the swine

within a single swine production

system, and if each swine production

system signs an agreement with the

Animal and Plant Health Inspection

Service and involved State governments

to monitor the health of animals moving

within the swine production system and

to facilitate traceback of these animals if

necessary. This action will facilitate the

interstate movement of swine while

continuing to provide protection against

the interstate spread of swine diseases.

This action will affect persons engaged

in swine production who regularly

move swine interstate in their business

operations.

EFFECTIVE DATE: January 22, 2002.

FOR FURTHER INFORMATION CONTACT: Dr.

Arnold Taft, Senior Staff Veterinarian,

National Animal Health Programs, VS,

APHIS, 4700 River Road Unit 43,

Riverdale, MD 20737–1231; (301) 734–

4916.

SUPPLEMENTARY INFORMATION:

Background

The regulations in subchapter C of

chapter I, title 9, Code of Federal

Regulations, govern the interstate

movement of animals to prevent the

dissemination of livestock and poultry

diseases in the United States. Parts 71

and 85 (referred to below as the

regulations) are included in subchapter

C. Part 71 relates to the interstate

movement of animals, poultry, and

animal products, and includes animal

identification requirements for swine

moving interstate. Part 85 imposes

requirements to control the spread of

pseudorabies and includes certificate

and other requirements for the interstate

movement of swine.

On September 21, 2000, we published

in the Federal Register (65 FR 57106–

57113, Docket No. 98–023–1) a proposal

to amend the regulations by establishing

an alternative to the current

requirements for moving swine

interstate.

With some exceptions, parts 71 and

85 require swine moving interstate to be

individually identified. As we

explained in our September 2000

proposed rule, these regulations were

written when swine (other than valued

breeding stock) were generally moved

interstate only when a change in

ownership occurred, usually when they

were shipped to slaughter. However,

today swine move interstate while they

are raised for slaughter or breeding

under a swine production system, and

while they remain under the control of

a single owner or group of contractually

related owners.

In order to better accommodate this

new model of swine production, we

proposed alternative requirements. As

proposed, producers could move swine

interstate under our alternative

procedures if they meet the following

requirements:

• The producers have a written swine

production health plan (SPHP) signed

by the producer(s), the accredited

veterinarian(s) for the premises, the

Animal and Plant Health Inspection

Service (APHIS), and the States in

which the producers in the swine

production system have premises.

• One or more accredited

veterinarians identified in the SPHP

will regularly visit each premises in the

swine production system to inspect and

test swine and will continually monitor

the health of the swine in the swine

production system. Swine may only be

moved interstate if they have been

found free from signs of any

communicable disease during the most

recent inspection of the premises by the

swine production system accredited

veterinarian(s).

• The SPHP describes a records

system maintained by the producers to

document the health status of the swine.

• Prior to each interstate movement of

swine between premises within a swine

production system, an interstate swine

movement report must be sent to

APHIS, the accredited veterinarian for

the premises, and the sending and

receiving States. That report must

document the number, type, and health

status of the swine being moved. Each

of these requirements was discussed in

detail in our proposal.

We solicited comments concerning

our proposal for 60 days ending

November 20, 2000. We received nine

comments by that date. They were from

representatives of State governments,

veterinarians, and pork producers and

pork producer organizations. They are

discussed below by topic.

Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations 65599

Contractual Versus Ownership

Relationships in Swine Production

Systems

One commenter addressed proposed

§ 71.19(h)(1), which states that ‘‘swine

may be moved interstate only to another

premises owned and operated by the

same swine production system.’’ This

commenter stated that this language

should be broad enough to allow

movements where one producer does

not necessarily own and operate both

sites, but there is a contractual

relationship between two producers,

which could include a change in

ownership of the animals.

We agree, and have changed the

language in § 71.19(h)(1) to read ‘‘swine

may be moved interstate only to another

premises identified in a valid swine

production health plan for the swine

production system.’’ This language is

also more consistent with the definition

of swine production system, which

reads ‘‘A swine production enterprise

that consists of multiple sites of

production, e.g., sow herds, nursery

herds, and growing or finishing herds,

that are connected by ownership or

contractual relationships, between

which swine move while remaining

under the control of a single owner or

a group of contractually connected

owners.’’

Certificates

One commenter noted that the

preamble of the proposed rule referred

to a ‘‘health certificate,’’ and stated that

‘‘a more accurate term is ’certificate of

veterinary inspection’ because the

Federal or accredited veterinarian is not

certifying the health status of the

animals, but instead is certifying that

animals were inspected and found to

comply with the statements contained

in the certificate.’’

We are not making any change to the

regulatory text of the rule in response to

this comment, although we have

changed the preamble of this final rule

so that it no longer refers to ‘‘health

certificates.’’ We agree that the preamble

of the proposed rule incorrectly referred

to certificates as ‘‘health certificates,’’ a

term that is not used anywhere in the

regulations we are amending. Part 85

defines the term ‘‘certificate,’’ and we

believe this definition is consistent with

the concerns of the commenter. We are

not changing the defined term from

‘‘certificate’’ to ‘‘certificate of veterinary

inspection’’ because that could cause

even more confusion. Statements in

certificates are not limited to facts that

could be disclosed directly by

veterinary inspection, but also include

such items as the identities of the

consignor and consignee, the purpose of

the movement, and the points of origin

and destination.

APHIS Participation

Several commenters stated that

APHIS need not sign SPHP’s or be

notified if an SPHP is cancelled, and

should not be empowered to cancel an

SPHP. We are not making any changes

based on these comments.

APHIS is ultimately responsible for

ensuring that swine diseases are not

spread interstate. We need to ensure

that individual SPHP’s meet our

requirements. We also need to be aware

of possible and actual interstate

movements. With this information, we

can monitor the effectiveness of the

program and be prepared to take action

if it appears there is a disease risk.

Requiring that we sign each SPHP and

be notified if an SPHP is cancelled is

minimally burdensome and effectively

and unobtrusively keeps us informed.

We also believe it is necessary that we

have the authority to cancel an SPHP to

respond to changing circumstances. For

example, as explained in our proposal,

we would cancel an SPHP if

participants persistently violated the

terms of the agreement or our

regulations.

Who Must Sign an SPHP and Be

Inspected?

Some commenters stated that not all

participants in a swine production

system are involved in sending or

receiving swine interstate, yet the

proposed rule would require all

participants to sign the SPHP. In

addition, the proposed rule would

require all participating premises and

swine to be inspected by an accredited

veterinarian. They suggested that only

participants who are actually involved

in moving swine interstate be required

to sign the SPHP, and that only

premises and swine that participate in

interstate movement should be subject

to veterinary inspection under the

SPHP. We agree and have made those

changes in this final rule. Specifically,

the definition of swine production

health plan in § 71.1 would now state

that the SPHP must be signed by ‘‘an

official of each swine production system

identified in the plan,’’ and that the

plan must provide for inspection of ‘‘all

premises that are part of the swine

production system and that receive or

send swine in interstate commerce.’’

Note that while these changes narrow

the coverage of the SPHP, they do not

reduce our overall authority to inspect

any swine moving in interstate

commerce at any time, or to take

enforcement action against any person

who moves swine interstate in violation

of our regulations, whether or not that

person is a signatory to an SPHP.

Regular and Routine Shipments

Some commenters suggested that we

change the proposed definition of swine

production system to add a requirement

that this term include only businesses

that regularly and routinely move swine

between their premises. We are not

making any changes based on this

comment for several reasons. First, the

commenters did not indicate what they

meant by ‘‘regularly and routinely.’’

Second, although we understand that

producers might not want to take

advantage of our proposed alternative

identification system if they participate

in few or infrequent interstate swine

shipments, we believe that is a decision

best made by producers. The number

and regularity of shipments is irrelevant

to the purpose of our proposed program,

which is to offer producers an

alternative identification system that is

less burdensome.

Recordkeeping and Access to Records

Several commenters addressed our

proposed recordkeeping requirements or

requirements concerning access to

records.

Some commenters objected to our

proposed requirement in the definition

of swine production health plan in

§ 71.1 that the SPHP ‘‘describe the

recordkeeping system of the swine

production system.’’ We are not making

any changes based on this comment. We

believe this is a reasonable requirement.

If a description is included in the SPHP,

we can tell at the time we review the

SPHP whether the recordkeeping system

is adequate to allow us to trace the

movements of animals.

Commenters also objected to our

proposed requirement in § 71.19(h)(6)

that participants maintain records

adequate to ‘‘trace any animal on the

premises back to its earlier premises and

its herd of origin.’’ We agree that such

extensive records are unnecessary and

are removing the phrase ‘‘and its herd

of origin’’ from § 71.19(h)(6). Records

that identify the earlier premises are

adequate, because if we need to trace an

animal farther back, we can use records

maintained by previous owners.

Commenters also stated that APHIS

and State representatives should have

access to records only ‘‘for cause.’’ ‘‘For

cause’’ implies that there has been a

violation of the regulations.

However, in most cases, we need to

examine records simply to ensure that

the program is working properly. Under

§ 71.19(h)(7), participants must allow

access to records ‘‘upon request.’’ In

65600 Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations

most cases this means participants will

receive advance notice. We believe this

is fair to participants, while giving

APHIS and State officials adequate

access.

Preemption

In accordance with Executive Order

12988, we included a statement in our

proposed rule giving notice that any

State and local laws and regulations in

conflict with the proposed provisions

would be preempted if the proposal is

adopted. A number of commenters

stated that including such a statement in

the rulemaking was harmful to StateFederal cooperative efforts. Other

commenters expressed concern that the

statement meant that a State could not

require any conditions for movement of

animals into the State over and above

the Federal requirements. Two

comments from States specifically

questioned whether Federal preemption

would preclude States from requiring

that persons moving swine into their

States must first obtain an ‘‘import

permit’’ from the State, authorizing

movement of the animals and

documenting that Federal and State

movement requirements are met prior to

movement of the animals.

Under Executive Order 12988, a

Federal agency that proposes a

regulation is required, among other

things, to specify in clear language the

preemptive effect it believes will be

given to its regulations. The presence or

absence of the statement does not

change the legal effect of the regulation,

and, therefore, should not be harmful to

State-Federal cooperation. The actual

effect of the regulation on the specific

questions presented would have to be

determined in an appropriate legal

proceeding.

In the case of State-issued ‘‘import

permits,’’ commenters stated that they

are needed for several reasons:

• To assign a permit number that is

associated with each movement of

animals and that can be tracked in State

records systems;

• To document that movements

comply with State as well as Federal

requirements;

• To give States a means to respond

quickly to new or reemerging animal

health concerns by denying a permit to

stop movement of problematic animals;

and

• To ensure that receiving States have

timely notice of animals moving into

their State.

We believe that the procedures in this

rule, especially use of the swine

production health plan, allow States to

retain all these capabilities without

issuing separate permits for each

movement of animals. It is already

common State practice to issue longterm permits for swine movements

within a State, and to allow multiple

groups of animals to move at different

times under the same permit. In this

regard, the SPHP serves the same

function for interstates movements as

such a State permit.

States currently can respond to

animal health concerns by denying or

canceling a permit to stop intrastate

movements of animals. Under this rule,

States may achieve the same effect by

withdrawing from a SPHP. However,

animals already in transit are a special

problem even under systems where

States issue individual permits.

With regard to ensuring that States

have timely notice of animal

movements, we do not believe that the

individual permit system accomplishes

this any better than the interstate swine

movement report employed by this rule.

Interstate Swine Movement Report

(ISMR)

Commenters raised two issues

concerning the proposed ISMR. One

was whether the form and transmissions

could be electronic; the other was

whether the forms could be transmitted

less frequently than proposed. In

§ 71.19(h)(4), our proposal stated that

both we and State authorities must be

notified prior to each interstate

movement of swine.

We have no objections to SPHP

participants using electronic forms and

transmitting them electronically. In fact,

we encourage this. If SPHP participants

want to communicate electronically,

they should provide for that in their

agreement. This will ensure that all

participants are prepared to send and

receive ISMR’s electronically. We have

amended the definition of interstate

swine movement report in § 71.1 in this

final rule to clarify that electronic forms

and transmission are acceptable for

notification prior to each interstate

movement of swine.

As noted above, our proposal stated

that APHIS must receive an ISMR prior

to each interstate movement of swine.

Commenters are correct that this could

result in many notices on a daily basis

for large production systems. We agree

that this many notices is unnecessary,

especially as many States routinely

forward this information to us.

Therefore, in this final rule we have

removed the requirement for an ISMR

prior to each interstate movement from

§ 71.19(h)(4). However, it is necessary

for us to be generally informed of the

number and locations of animals

moving interstate. We need this

information so we can monitor the

success of the program and compliance

with our regulations. Therefore, we have

added to § 71.19(h)(8) of this final rule

a requirement that swine production

systems send us a written, monthly

summary of interstate swine movements

under the SPHP.

Pseudorabies Status of Swine

Commenters suggested that it is

unnecessary that each ISMR specifically

include the pseudorabies status of swine

moving interstate under an SPHP

because pseudorabies will be eradicated

from the U.S. swine population in the

next few months. Commenters

suggested that the ISMR instead include

the health status of the swine for

diseases of regulatory importance. These

diseases, which would include

pseudorabies until that disease is

eradicated, would have to be specified

in the SPHP. We agree with this

suggestion and have made this change

in the definition of interstate swine

movement report in § 71.1 of this final

rule.

Inspections

The definition of swine production

health plan in § 71.1 of our proposal

provided that swine premises be

inspected by an accredited veterinarian

at least once every 30 days. Some

commenters requested that we reduce

the frequency. We are not making any

change based on these comments.

Reducing the frequency would put

accredited veterinarians in violation of

our accreditation standards in 9 CFR

161.3(a). Under these standards,

accredited veterinarians must complete

certificates of inspection based on

veterinary inspection. An accredited

veterinarian may not issue any

certificate or other document ‘‘which

reflects the results of any inspection,

test, [etc.]’’ unless he or she has

personally inspected the animal not

more than 10 days prior to issuing the

certificate or other document. Following

the initial and subsequent inspections of

a herd or flock that is in a regular health

maintenance program, an accredited

veterinarian may issue any certificate or

other document if not more than 30

days have passed since he or she

personally inspected the animal.

Commingling Swine

Commenters objected to the proposed

requirement in § 71.19 that ‘‘receiving

premises must not commingle swine

received from different premises in a

manner that prevents identification of

the premises that sent the swine or

groups of swine.’’ The commenters

interpreted this to mean that we

proposed to prohibit all commingling.

Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations 65601

1The rule will not apply to swine moving in

slaughter channels; those animals will have to

continue to meet the current requirements for

individual identification and certification, as

applicable.

2Producers, especially the larger ones, typically

obtain certificates from accredited veterinarians

who are unaffiliated with APHIS or the State

agricultural agencies. The veterinarian fee of $35 is

an estimate based on telephone consultation with

several accredited veterinarians; such fees can vary

depending on individual circumstances. In some

cases, veterinarians charge no fee for issuing a

certificate, especially when they are dealing with

producers for whom they provide services on a

regular, routine basis.

This is incorrect. We are only

prohibiting commingling if it is done in

a way that makes it impossible for us to

identify the source of individual swine.

We believe the proposed regulations are

clear, and we are not making any

changes based on this comment.

Size of Participating Swine Production

Systems

One commenter noted that while the

proposal provided that swine producers

of any size could use the proposed

alternative procedures, the bulk of the

proposal’s discussion emphasized

benefits for the largest producers. This

commenter stated that it is important to

point out that the usefulness of the

proposed system for identification and

movement is not related to the size of

the operation, rather it is related to the

producer’s production scheme. We

agree, and have revised the economic

analysis in this proposed rule to point

out that the new procedures can benefit

any producer who uses a multi-State

approach to swine production.

Complexity of the Proposed System

One commenter stated that the

proposed system has grown too

complex, and involves more persons in

swine movement than is necessary.

We have made no change based on

this comment. The changes are all based

on the need to ensure that the system

operates effectively and contains

sufficient safeguards to prevent the

spread of communicable diseases. We

believe that the detailed requirements

for agreements and recordkeeping will

enhance enforcement and monitoring of

the system.

Therefore, for the reasons given in the

proposed rule and in this document, we

are adopting the proposed rule as a final

rule with the changes discussed in this

document.

Executive Order 12866 and Regulatory

Flexibility Act

This rule has been reviewed under

Executive Order 12866. The rule has

been determined to be significant for the

purposes of Executive Order 12866 and,

therefore, has been reviewed by the

Office of Management and Budget. The

economic analysis prepared for this rule

is set out below. It includes both a costbenefit analysis as required by

Executive Order 12866 and an analysis

of the economic effects on small entities

as required by the Regulatory Flexibility

Act.

This rule will offer an alternative to

the current requirements for moving

certain swine interstate.1 Under the

rule, producers within a single

production system (e.g., owners of sow

farms, nurseries, and growing or

finishing operations) could move swine

interstate without meeting the current

identification and certification

requirements if an official of the swine

production system signs a swine health

production plan with APHIS and the

sending and receiving States, and if

each premises: (1) Has an accredited

veterinarian visit the individual

premises at least once every 30 days to

assess and document the general health

of the animals; (2) maintains a

recordkeeping system adequate to

enable APHIS or State inspectors to

trace an animal back to its earlier

premises; and (3) notifies the accredited

veterinarian and State regulatory

officials in the States of origin and

destination when swine are ready to be

moved interstate. The rule will not

mandate a specific type of

recordkeeping system; those in the

production system will be free to choose

their own system of records, as long as

APHIS determines that the system meets

the requirements of § 71.19(h)(6) and

effectively documents animal health

and allows for animal traceback. The

formal written agreement will have to be

approved and signed by the producers

moving swine interstate under the

system, APHIS, and the relevant States.

The primary economic benefits to

producers will be that they avoid the

costs of individually identifying animals

and obtaining a certificate for each

shipment. Recordkeeping costs under

the current requirements and under this

alternative should be comparable,

although some different records (copies

of SPHP’s and ISMR’s) would be

maintained under this final rule.

The rule will benefit U.S. swine

producers who move their animals

interstate within a single production

system. Currently, such systems are

used by most of the largest producers,

although many medium and small

producers also employ multi-State

production. Producers who already

move their animals interstate during

production will be able to realize the

benefits of this rule with little or no

additional cost, since many have most

of the major elements of the new

recordkeeping system (i.e., records

indicating the source and disposition of

swine and identifying which swine are

grouped together) already in place.

As an example of the potential cost

savings for producers from not having to

individually identify animals, we

estimate that the material cost for each

identification eartag is about 5 cents and

that it takes 1 person 1 hour to attach

about 250 eartags. For a large producer

who moves 1 million swine interstate

each year with an eartag, the annual

savings if the producer no longer uses

eartags would be about $50,000 in

materials and about $40,000 in labor

(assuming a labor rate of $10/hr.).

Certificates are typically issued on a

per-shipment basis, with one certificate

issued for all swine in a truckload. For

a producer who moves 1 million swine

interstate each year, the annual cost of

obtaining certificates is about $140,000

(assuming 250 swine per shipment and

a veterinarian fee of $35 per shipment).2

Under the rule, individual identification

and certificates will be replaced by the

records kept in accordance with the

regulations and the ISMR’s issued for

interstate movements attesting that the

swine were found healthy by an

accredited veterinarian within the 30

days preceding the interstate movement.

The requirement in the regulations

that an accredited veterinarian must

visit the premises at least once every 30

days to assess the general health of the

animals should not constitute an

additional burden for producers, since

most are already visited by a

veterinarian on that basis as part of a

regular health maintenance program.

As indicated above, this rule will

eliminate the need for producers to

obtain certificates from accredited

veterinarians on an individual shipment

basis. This is not expected to have a

negative impact on the accredited

veterinarian’s income because most

accredited veterinarians generate little

or no income from issuing certificates,

charging either a nominal fee or no fee

at all, especially when they are dealing

with producers for whom they provide

services on a regular, routine basis. This

change should allow them to make more

productive use of their time by allowing

them to schedule regular health

maintenance visits to a facility, rather

than visiting when called, possibly at

inconvenient times, to issue certificates

just prior to movement. This change

should also give producers more

65602 Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations

3Source: Agricultural Statistics, 1999. The hog

and pig operation count is as of December 1, 1998.

4See 1997 Census of Agriculture, vol. 1, Part 51,

United States. As used here, the word ‘‘top’’ refers

to those farms with the highest number of animals

sold.

flexibility in scheduling movements of

swine.

Effects on Small Entities

The rule will primarily benefit U.S.

swine producers who move their

animals interstate within a single

production system. Currently, such

systems are used primarily by the

producers who do not appear to be

small in size by U.S. Small Business

Administration (SBA) criteria. The SBA

considers a hog farm or feedlot small if

its annual receipts are $0.5 million or

less. We estimate that, of the 114,380

hog and pig operations in the United

States, no more than about 4 percent (or

4,575) currently participate in multiState production systems and, of those

that do participate, most rank among the

industry’s largest producers.3 Census

data from the National Agricultural

Statistics Service (NASS) indicate that,

in 1997, the per-farm average value of

pigs and hogs sold for the top 4 percent

of U.S. farms was in excess of $0.5

million.4 NASS’ data suggest, therefore,

that many of the producers that

currently participate in interstate

production systems are not small by

SBA standards.

The rule may encourage more small

producer participation in the future,

since it will provide them with an

economic incentive to network together

into one production system. For some

small producers, especially those

operating on thin profit margins, this

opportunity to reduce costs via

production networks could make the

difference between economic viability

and insolvency. At this time, however,

there is no basis to conclude that the

number of small producers who might

form networks in the future will be

substantial.

Under these circumstances, the

Administrator of the Animal and Plant

Health Inspection Service has

determined that this action will not

have a significant economic impact on

a substantial number of small entities.

Executive Order 12372

This program/activity is listed in the

Catalog of Federal Domestic Assistance

under No. 10.025 and is subject to

Executive Order 12372, which requires

intergovernmental consultation with

State and local officials. (See 7 CFR part

3015, subpart V.)

Executive Order 12988

This final rule has been reviewed

under Executive Order 12988, Civil

Justice Reform. This rule: (1) Preempts

all State and local laws and regulations

that are in conflict with this rule; (2) has

no retroactive effect; and (3) does not

require administrative proceedings

before parties may file suit in court

challenging this rule.

Executive Order 13132

Executive Order 13132, ‘‘Federalism,’’

requires that Agencies assess the

federalism implications of their policies

that have federalism implications, i.e.,

agency statements and actions that have

substantial direct effects on the States,

on the relationship between the national

government and the States, or on the

distribution of power and

responsibilities among the various

levels of government. This final rule

does not have substantial direct effects

in these areas, and therefore does not

require assessment of federalism

implications under Executive Order

13132.

Paperwork Reduction Act

In accordance with the Paperwork

Reduction Act of 1995 (44 U.S.C. 3501

et seq.), the information collection or

recordkeeping requirements included in

this rule have been approved by the

Office of Management and Budget

(OMB) under OMB control number

0579–0161.

In this final rule we have reduced the

information collection and

recordkeeping requirements contained

in the proposed rule. We have added

provisions to allow participants to

maintain and submit Interstate Swine

Movement Reports electronically, rather

than by paper copy. We have also

removed the requirement that producers

submit an ISMR prior to each interstate

movement, and have substituted a less

burdensome requirement that swine

production systems send us a written,

monthly summary of interstate swine

movements under the SPHP.

List of Subjects

9 CFR Part 71

Animal diseases, Livestock, Poultry

and poultry products, Quarantine,

Reporting and recordkeeping

requirements, Transportation.

9 CFR Part 85

Animal diseases, Livestock,

Quarantine, Reporting and

recordkeeping requirements,

Transportation.

Accordingly, we are amending 9 CFR

parts 71 and 85 as follows:

PART 71—GENERAL PROVISIONS

1. The authority citation for part 71

continues to read as follows:

Authority: 21 U.S.C. 111–113, 114a, 114a–

1, 115–117, 120–126, 134b, and 134f; 7 CFR

2.22, 2.80, and 371.4.

2. In § 71.1, definitions of interstate

swine movement report, swine

production health plan, swine

production system, swine production

system accredited veterinarian are

added in alphabetical order to read as

follows:

§ 71.1 Definitions.

* * * * *

Interstate swine movement report. A

paper or electronic document signed by

a producer moving swine giving notice

that a group of animals is being moved

across State lines in a swine production

system. This document must contain the

name of the swine production system;

the name, location, and premises

identification number of the premises

from which the swine are to be moved;

the name, location, and premises

identification number of the premises to

which the swine are to be moved; the

date of movement; and the number, age,

and type of swine to be moved. This

document must also contain a

description of any individual or group

identification associated with the swine,

the name of the swine production

system accredited veterinarian(s), the

health status of the herd from which the

swine are to be moved, including any

disease of regulatory concern to APHIS

or to the States involved, and an

accurate statement that swine on the

premises from which the swine are to be

moved have been inspected by the

swine production system accredited

veterinarian(s) within 30 days prior to

the interstate movement and consistent

with the dates specified by the

premises’ swine production health plan

and found free from signs of

communicable disease.

* * * * *

Swine production health plan. A

written agreement developed for a

swine production system designed to

maintain the health of the swine and

detect signs of communicable disease.

The plan must identify all premises

that are part of the swine production

system and that receive or send swine

in interstate commerce and must

provide for regular inspections of all

identified premises and swine on the

premises, at intervals no greater than 30

days, by the swine production system

accredited veterinarian(s). The plan

must also describe the recordkeeping

system of the swine production system.

Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations 65603

The plan will not be valid unless it is

signed by an official of each swine

production system identified in the

plan, the swine production system

accredited veterinarian(s), an APHIS

representative, and the State animal

health official from each State in which

the swine production system has

premises. In the plan, the swine

production system must acknowledge

that it has been informed of and has

notified the managers of all its premises

listed in the plan that any failure of the

participants in the swine production

system to abide by the provisions of the

plan and the applicable provisions of

this part and part 85 of this chapter

constitutes a basis for the cancellation of

the swine production health plan, as

well as other administrative or criminal

sanctions, as appropriate.

Swine production system. A swine

production enterprise that consists of

multiple sites of production; i.e., sow

herds, nursery herds, and growing or

finishing herds, but not including

slaughter plants or livestock markets,

that are connected by ownership or

contractual relationships, between

which swine move while remaining

under the control of a single owner or

a group of contractually connected

owners.

Swine production system accredited

veterinarian. An accredited veterinarian

who is named in a swine production

health plan for a premises within a

swine production system and who

performs inspection of such premises

and animals and other duties related to

the movement of swine in a swine

production system.

* * * * *

3. Section 71.19 is amended as

follows:

a. In paragraph (a)(1), introductory

text, by removing the words ‘‘paragraph

(c)’’ and adding in their place the words

‘‘paragraphs (c) and (h)’’.

b. By adding new paragraphs (h) and

(i).

§ 71.19 Identification of swine in interstate

commerce.

* * * * *

(h) Swine moving interstate within a

swine production system. Swine moving

within a swine production system to

other than slaughter or a livestock

market are not required to be

individually identified when moved in

interstate commerce under the following

conditions:

(1) The swine may be moved

interstate only to another premises

identified in a valid swine production

health plan for that swine production

system.

(2) The swine production system must

operate under a valid swine production

health plan, in which both the sending

and receiving States have agreed to

allow the movement.

(3) The swine must have been found

free from signs of any communicable

disease during the most recent

inspection of the premises by the swine

production system accredited

veterinarian(s) within 30 days prior to

movement.

(4) Prior to the movement of any

swine, the producer(s) moving swine

must deliver the required interstate

swine movement report to the following

individuals identified in the swine

production health plan:

(i) The swine production system

accredited veterinarian for the premises

from which the swine are to be moved,

and

(ii) The State animal health officials

for the sending and receiving States, and

any other State employees designated by

the State animal health officials.

(5) The receiving premises must not

commingle swine received from

different premises in a manner that

prevents identification of the premises

that sent the swine or groups of swine.

This may be achieved by use of

permanent premises or individual

identification marks on animals, by

keeping groups of animals received from

one premises physically separate from

animals received from other premises,

or by any other effective means.

(6) Each premises must maintain, for

3 years after their date of creation,

records that will allow an APHIS

representative or State animal health

official to trace any animal on the

premises back to its previous premises,

and must maintain copies of each swine

production health plan signed by the

producer, all interstate swine movement

reports issued by the producer, and all

reports the swine production system

accredited veterinarian(s) issue

documenting the health status of the

swine on the premises.

(7) Each premises must allow APHIS

representatives and State animal health

officials access to the premises upon

request to inspect animals and review

records.

(8) Once a month, each swine

production system must send APHIS a

written summary based on the interstate

swine movement report data that shows

how many animals were moved in the

past month, the premises from which

they were moved, and the premises to

which they were moved.

(i) Cancellation of and withdrawal

from a swine production health plan.

The following procedures apply to

cancellation of, or withdrawal from, a

swine production health plan:

(1) A State animal health official may

cancel his or her State’s participation in

a swine production health plan by

giving written notice to all swine

producers, APHIS representatives,

accredited veterinarians, and other State

animal health officials listed in the plan.

Withdrawal shall be effective upon the

date specified by the State animal health

official in the notice, but for shipments

in transit, withdrawal shall become

effective 7 days after the date of such

notice. Upon withdrawal of a State, the

swine production health plan may

continue to operate among the other

States and parties signatory to the plan.

(2) A swine production system may

withdraw one or more of its premises

from participation in the plan upon

giving written notice to the

Administrator, the accredited

veterinarian(s), all swine producers

listed in the plan, and State animal

health officials listed in the plan.

Withdrawal shall be effective upon the

date specified by the swine production

system in the written notice, but for

shipments in transit, withdrawal shall

become effective 7 days after the date of

such notice.

(3) The Administrator may cancel a

swine production health plan by giving

written notice to all swine producers,

accredited veterinarians, and State

animal health officials listed in the plan.

The Administrator shall cancel a swine

production health plan after

determining that swine movements

within the swine production system

have occurred that were not in

compliance with the swine production

health plan or with other requirements

of this chapter. Before a swine health

production plan is canceled, an APHIS

representative will inform a

representative of the swine production

system of the reasons for the proposed

cancellation. The swine production

system may appeal the proposed

cancellation in writing to the

Administrator within 10 days after

being informed of the reasons for the

proposed cancellation. The appeal must

include all of the facts and reasons upon

which the swine production system

relies to show that the reasons for the

proposed cancellation are incorrect or

do not support the cancellation. The

Administrator will grant or deny the

appeal in writing as promptly as

circumstances permit, stating the reason

for his or her decision. If there is a

conflict as to any material fact, a hearing

will be held to resolve the conflict.

Rules of practice concerning the hearing

will be adopted by the Administrator.

However, cancellation of the disputed

65604 Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations

swine production health plan shall

become effective pending final

determination in the proceeding if the

Administrator determines that such

action is necessary to protect the

public’s health, interest, or safety. Such

cancellation shall become effective

upon oral or written notification,

whichever is earlier, to the swine

production system representative. In the

event of oral notification, written

confirmation shall be given as promptly

as circumstances allow. This

cancellation shall continue in effect

pending the completion of the

proceeding, and any judicial review

thereof, unless otherwise ordered by the

Administrator.

PART 85—PSEUDORABIES

4. The authority citation for part 85

continues to read as follows:

Authority: 21 U.S.C. 111–113, 115, 117,

120, 121, 123–126, 134b, and 134f; 7 CFR

2.22, 2.80, and 371.4.

§ 85.7 [Amended]

5. Section 85.7 is amended as follows:

a. In paragraph (b)(3)(i), by removing

the phrase ‘‘The swine’’ and adding in

its place the phrase ‘‘Unless the swine

are moving interstate in a swine

production system in compliance with

§ 71.19(h) of this chapter, the swine’’.

b. In paragraph (b)(3)(ii), by removing

the phrase ‘‘The swine are accompanied

by a certificate’’ and adding in its place

the phrase ‘‘Unless the swine are

moving interstate in a swine production

system in compliance with § 71.19(h) of

this chapter, the swine are accompanied

by a certificate’’.

c. In paragraph (c)(1), by removing the

phrase ‘‘The swine are accompanied by

a certificate’’ and adding in its place the

phrase ‘‘Unless the swine are moving

interstate in a swine production system

in compliance with § 71.19(h) of this

chapter, the swine are accompanied by

a certificate’’.

6. Section 85.8 is amended by

removing the period at the end of

paragraph (a)(3) and adding in its place

‘‘; or’’; and by adding a new paragraph

(a)(4) to read as follows:

§ 85.8 Interstate movement of swine from

a qualified negative gene-altered vaccinated

herd.

(a) * * *

(4) The swine are moved interstate in

a swine production system in

compliance with § 71.19(h) of this

chapter.

* * * * *

Done in Washington, DC, this 14th day of

December 2001.

Bill Hawks,

Under Secretary for Marketing and Regulatory

Programs.

[FR Doc. 01–31355 Filed 12–19–01; 8:45 am]

BILLING CODE 3410–34–U

FEDERAL RESERVE SYSTEM

12 CFR Part 226

[Regulation Z; Docket No. R–1090]

Truth in Lending

AGENCY: Board of Governors of the

Federal Reserve System.

ACTION: Final rule.

SUMMARY: The Board is adopting

amendments to the provisions of

Regulation Z (Truth in Lending) that

implement the Home Ownership and

Equity Protection Act (HOEPA). HOEPA

was enacted in 1994, in response to

evidence of abusive lending practices in

the home-equity lending market.

HOEPA imposes additional disclosure

requirements and substantive

limitations (for example, restricting

short-term balloon notes) on homeequity loans bearing rates or fees above

a certain percentage or amount. The

Board’s amendments to Regulation Z

broaden the scope of mortgage loans

subject to HOEPA by adjusting the price

triggers used to determine coverage

under the act. The rate-based trigger is

lowered by two percentage points for

first-lien mortgage loans, with no

change for subordinate-lien loans. The

fee-based trigger is revised to include

the cost of optional credit insurance and

similar debt protection products paid at

closing. The amendments restrict

certain acts and practices in connection

with home-secured loans. For example,

creditors may not engage in repeated

refinancings of their HOEPA loans over

a short time period when the

transactions are not in the borrower’s

interest. The amendments also

strengthen HOEPA’s prohibition against

extending credit without regard to

consumers’ repayment ability, and

enhance disclosures received by

consumers before closing for HOEPAcovered loans.

DATES: The rule is effective December

20, 2001; compliance is mandatory as of

October 1, 2002.

FOR FURTHER INFORMATION CONTACT:

Minh-Duc T. Le, Attorney, Daniel G.

Lonergan, Counsel, or Jane E. Ahrens,

Senior Counsel, Division of Consumer

and Community Affairs, at (202) 452–

3667 or 452–2412; for users of

Telecommunications Device for the Deaf

(‘‘TDD’’) only, contact (202) 263–4869.

SUPPLEMENTARY INFORMATION:

I. Background

Since the mid-1990s, the subprime

mortgage market has grown

substantially, providing access to credit

to borrowers with less-than-perfect

credit histories and to other borrowers

who are not served by prime lenders.

With this increase in subprime lending

there has also been an increase in

reports of ‘‘predatory lending.’’ The

term ‘‘predatory lending’’ encompasses

a variety of practices. In general, the

term is used to refer to abusive lending

practices involving fraud, deception, or

unfairness. Some abusive practices are

clearly unlawful, but others involve

loan terms that are legitimate in many

instances and abusive in others, and

thus are difficult to regulate. Loan terms

that may benefit some borrowers, such

as balloon payments, may harm other

borrowers, particularly if they are not

fully aware of the consequences. The

reports of predatory lending have

generally included one or more of the

following: (1) Making unaffordable

loans based on the borrower’s home

equity without regard to the borrower’s

ability to repay the obligation; (2)

inducing a borrower to refinance a loan

repeatedly, even though the refinancing

may not be in the borrower’s interest,

and charging high points and fees each

time the loan is refinanced, which

decreases the consumer’s equity in the

home; and (3) engaging in fraud or

deception to conceal the true nature of

the loan obligation from an

unsuspecting or unsophisticated

borrower—for example, ‘‘packing’’ loans

with credit insurance without a

consumer’s consent.

A. The Home Ownership and Equity

Protection Act

In response to anecdotal evidence

about abusive practices involving homesecured loans with high rates or high

fees, in 1994 the Congress enacted the

Home Ownership and Equity Protection

Act (HOEPA), Pub. L. 103–325, 108 Stat.

2160, as an amendment to the Truth in

Lending Act (TILA), 15 U.S.C. 1601 et

seq. TILA is intended to promote the

informed use of consumer credit by

requiring disclosures about its terms

and cost. TILA requires creditors to

disclose the cost of credit as a dollar

amount (the ‘‘finance charge’’) and as an

annual percentage rate (the ‘‘APR’’).

Uniformity in creditors’ disclosures is

intended to assist consumers in

comparison shopping. TILA requires

additional disclosures for loans secured

by a consumer’s home and permits