[Federal Register Volume 60, Number 71 (Thursday, April 13, 1995)]
[Proposed Rules]
[Pages 18781-18782]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-9085]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 60, No. 71 / Thursday, April 13, 1995 /
Proposed Rules
[[Page 18781]]
DEPARTMENT OF AGRICULTURE
Food and Consumer Service
7 CFR Part 250
RIN 0584-AB99
Waiver Authority Under the State Processing Program
AGENCY: Food and Consumer Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This rule proposes to amend the Food Distribution Program
regulations by giving the Food and Consumer Service authority to waive
provisions contained in the Food Distribution Program regulations at 7
CFR part 250. This authority would be used to conduct, in one or more
areas of the United States, demonstration projects designed to test
program changes to determine whether the changes would improve the
State processing of donated foods.
DATES: To be assured of consideration, comments must be postmarked on
or before May 15, 1995.
ADDRESSES: Comments should be sent to Phil Cohen, Chief, Policy and
Program Development Branch, Food Distribution Division, Food and
Consumer Service, U.S. Department of Agriculture, 3101 Park Center
Drive, Room 502, Alexandria, Virginia 22302. Comments in response to
this rule may be inspected at 3101 Park Center Drive, room 506,
Alexandria, Virginia, during normal business hours (8:30 a.m. to 5
p.m.), Mondays through Fridays.
FOR FURTHER INFORMATION CONTACT: David Seger, Policy and Program
Development Branch, Food Distribution Division, Food and Consumer
Service, U.S. Department of Agriculture, 3101 Park Center Drive, Room
502, Alexandria, Virginia 22302; or telephone (703) 305-2660.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This proposed rule has been determined to be not significant for
purposes of Executive Order 12866 and, therefore, has not been reviewed
by the Office of Management and Budget (OMB).
Paperwork Reduction Act
This proposed rule reflects no new information collection
requirements under the Paperwork Reduction Act of 1980 (44 U.S.C. 3501-
3502). The OMB control number assigned to the existing recordkeeping
and reporting requirements was approved by OMB for Part 250 under
control number 0584-0007. The current burden hours will not change as a
result of this proposed rule.
Executive Order 12372
This program is listed in the Catalog of Federal Domestic
Assistance under 10.550 and is subject to the provisions of Executive
Order 12372 which requires intergovernmental consultation with State
and local officials (7 CFR part 3015, Subpart V and final rule-related
notices published at 48 FR 29114, June 24, 1983 and 49 FR 22676, May
31, 1984).
Executive Order 12778
This proposed rule has been reviewed under Executive Order 12778,
Civil Justice Reform. This proposed rule is intended to have preemptive
effect with respect to any State or local laws, regulations or policies
which conflict with its provisions or which would otherwise impede its
full implementation. This proposed rule is not intended to have
retroactive effect unless so specified in the Effective Date section of
this preamble. Prior to any judicial challenge to the provisions of
this rule or the application of its provisions, all applicable
administrative procedures must be exhausted. This includes any
administrative procedures provided by State or local governments. For
disputes involving procurement by distributing and recipient agencies,
this includes any administrative appeal procedures to the extent
required by 7 CFR Parts 3015 or 3016.
Regulatory Flexibility Act
This proposed rule has been reviewed with regard to the
requirements of the Regulatory Flexibility Act (5 U.S.C. 601-612). The
Administrator of the Food and Consumer Service (FCS) has certified that
this proposed rule will not have a significant economic impact on a
substantial number of small entities. The cost of compliance to State
processors of donated foods is expected to be reduced by the changes
proposed in this rule.
Background
Section 250.30 of the current Food Distribution Program regulations
sets forth the terms and conditions under which distributing agencies,
subdistributing agencies, and recipient agencies may enter into
contracts with commercial firms for processing donated foods and
prescribes the minimum requirements to be included in such contracts.
Discussion of Proposed Rule
The State processing regulations contain provisions specifically
intended to ensure that processors account for all donated foods in the
manufacture of end products and pass on the full value of the donated
food as savings to eligible recipient agencies. In the late 1970's and
the early 1980's, audits conducted by the Department of Agriculture's
Office of Inspector General disclosed significant abuses in the
processing program. As a result of these audits, certain requirements
were incorporated to ensure that processors properly account for the
donated food, such as the certified public accountant audit report
requirement at Secs. 250.18(b) and 250.30(c)(4)(xi), the requirement
for Agricultural Marketing Service (AMS) acceptance service grading of
meat and poultry products at Sec. 250.30(g) and (h), and the
performance supply and surety bond requirement at
Sec. 250.30(c)(4)(viii)(B).
In recent years, it has been pointed out that some of the
provisions contained in the State processing regulations are overly
restrictive. As a result of the restrictions, some commercial
processors have opted to no longer participate in the program. The Food
and Consumer Service (FCS) is aware that new companies are not willing
to enter into agreements with the distributing agencies, thus eroding
competition. Processors have also commented that compliance with some
of the provisions in the regulations has increased their cost of
producing end products. These increased costs are in
[[Page 18782]]
turn being passed on to the recipient agencies.
In addition, FCS' review of the certified public accountant audit
reports submitted by multi-State processors participating in the
processing program has disclosed that the majority of processors
participating in the program are operating in compliance with the
regulations and their processing agreements. Also, representatives from
AMS have indicated that processors are properly accounting for meat and
poultry.
FCS is interested in attracting more companies to participate in
the processing program in order to increase competition. Increased
competition should lower costs, improve quality, and provide a greater
variety of end products for recipient agencies. Reducing unnecessarily
burdensome requirements should further reduce the cost to recipient
agencies. FCS has identified certain provisions in the regulations that
could be modified or eliminated. The Department is interested in
conducting demonstration projects in these areas to determine if
changing the rules will result in increased competition and lower costs
in the program. In order to conduct such projects, it will be necessary
for FCS to waive certain requirements contained in the regulations.
This rule proposes to permit FCS to waive any of the requirements
of the Food Distribution Program regulations at Part 250 for the
purposes of conducting demonstration projects to test program changes
designed to improve the State processing of donated foods.
List of Subjects in 7 CFR Part 250
Agricultural commodities, Food assistance programs, Food
processing.
For reasons set forth in the preamble, 7 CFR Part 250 is proposed
to be amended as follows:
PART 250--DONATION OF FOODS FOR USE IN THE UNITED STATES, ITS
TERRITORIES AND POSSESSIONS AND AREAS UNDER ITS JURISDICTION
1. The authority citation for Part 250 continues to read as
follows:
Authority: 5 U.S.C. 301; 7 U.S.C. 612c, 612c note, 1431, 1431b,
1431e, 1431 note, 1446a-1, 1859; 15 U.S.C. 713c; 22 U.S.C. 1922; 42
U.S.C. 1751, 1755, 1758, 1760, 1761, 1762a, 1766, 3030a, 5179, 5180.
2. In Sec. 250.30, a new paragraph (t) is added to read as follows:
Sec. 250.30 State processing of donated foods.
* * * * *
(t) Waiver authority. The Food and Consumer Service may waive any
of the requirements contained in this part for the purpose of
conducting demonstration projects to test program changes designed to
improve the State processing of donated foods.
Dated: April 6, 1995.
William E. Ludwig,
Administrator.
[FR Doc. 95-9085 Filed 4-12-95; 8:45 am]
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