[Federal Register Volume 65, Number 109 (Tuesday, June 6, 2000)]
[Proposed Rules]
[Pages 35857-35869]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-14113]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
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 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. 65, No. 109 / Tuesday, June 6, 2000 / 
Proposed Rules  

[[Page 35857]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 54

[Docket No. LS-98-09]
RIN 0581-AB69


Regulations Governing the Certification of Sanitary Design and 
Fabrication of Equipment Used in the Slaughter, Processing, and 
Packaging of Livestock and Poultry Products

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: The Agricultural Marketing Service (AMS) is proposing to 
develop a voluntary, user-fee funded program under the authority of the 
Agricultural Marketing Act of 1946 to inspect and certify equipment and 
utensils used to process livestock and poultry products. Livestock and 
poultry processing equipment and utensils inspected and certified by 
AMS to voluntary consensus standards for sanitary design will provide a 
third party assurance that they meet minimum requirements for 
cleanability, suitability of materials used in construction, durability 
and inspectability. Development of this program is required under the 
provisions of the 1999 Agricultural Appropriations Bill.

DATES: Comments must be received by August 7, 2000.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this program. Send two copies of comments to Barry L. 
Carpenter, Deputy Administrator, Livestock and Seed Program, Docket No. 
LS-99-12, Room 2092 South Agriculture Building, 1400 Independence Ave., 
SW, Washington, DC 20250-0249.
    All comments received in response to this notice will be considered 
part of the public record and will be available for viewing in Room 
2092 South Agriculture Building, 1400 Independence Ave., SW, 
Washington, DC 20250-0249 between 8:30 a.m. and 4:30 p.m., Monday 
through Friday.

FOR FURTHER INFORMATION CONTACT: Barry Carpenter, Deputy Administrator, 
Livestock and Seed Program, by telephone at (202) 720-5705 or by Fax at 
(202) 720-3499.

SUPPLEMENTARY INFORMATION:   

Background

    The 1999 Agricultural Appropriations Bill, (Pub. L. 105-277, sec. 
747), requires AMS to develop a voluntary, user-fee funded program to 
inspect and certify equipment and utensils used to process livestock 
and poultry products. From 1975 to 1997, a similar function was carried 
out by USDA on a mandatory prior approval basis by USDA's Food Safety 
and Inspection Service (FSIS) as a prerequisite for equipment use in 
federally inspected meat and poultry packing and processing 
establishments. The FSIS Equipment Branch formally evaluated equipment 
and utensils proposed by manufacturers or suppliers before they could 
be used in official establishments to assure they could be maintained 
in a sanitary condition. The program focused on identifying and 
correcting problems during the initial development of equipment and 
utensils, instead of resolving problems after equipment and utensils 
were put into widespread use.
    FSIS's acceptance of new, modified, or reconditioned equipment and 
utensils for use in federally inspected meat and poultry establishments 
was a two-step process. First, FSIS Equipment Branch personnel 
evaluated the design and construction of equipment by reviewing 
assembly-type drawings and corresponding parts and material lists 
submitted to the Branch by the equipment manufacturer. Then, if 
necessary, FSIS inspectors reviewed the in-establishment operation of 
the equipment and reported their findings to the Equipment Branch. 
Commercially available equipment was accepted and listed in an FSIS 
reference guide, ``Accepted Meat and Poultry Equipment.'' Once 
equipment was listed in this reference as acceptable, no further 
approval was needed on an establishment basis.
    FSIS continues to ensure that equipment and utensils used in 
federally inspected facilities are of such material and construction as 
will facilitate their thorough cleaning and operational cleanliness, 
and not adulterate edible product. Also, FSIS still requires that 
equipment and utensils used in federally inspected establishments are 
constructed, maintained, and used in a manner that does not interfere 
with inspection. However, in an effort to remove ``command and 
control'' regulations that were contrary to FSIS' commitment to the 
Hazard Analysis and Critical Control Point approach to Federal meat 
inspection, and to provide federally inspected establishments with the 
flexibility to use equipment and utensils designed in the manner they 
deem to best maintain a sanitary environment for food production 
without having to seek prior approval, FSIS discontinued the mandatory 
prior approval program for equipment and utensils on September 24, 1997 
(62 FR 45016).
    At the time FSIS announced that it was discontinuing its prior 
approval program, equipment and utensil manufacturers and processors of 
livestock and poultry products expressed their desire to either 
continue the FSIS program or develop a new program through AMS on a 
voluntary, user-fee funded basis to inspect and certify equipment and 
utensils used to process livestock and poultry products to a sanitary 
standard. Subsequently, passage of the 1999 Omnibus Appropriations Bill 
required development of such a program under the Agricultural Marketing 
Act of 1946 (AMA) (7 U.S.C. 1621-1627).
    Accordingly, on July 16, 1999, AMS published in the Federal 
Register (64 FR 38315) an advance notice of proposed rulemaking (ANPRM) 
and notice of public meeting to assist the Agency in the development of 
a complete inspection and certification program for equipment and 
utensils used to process livestock and poultry products.
    Through the ANPRM and the public meeting, AMS sought information 
which would enable the Agency to develop an efficient and cost-
effective program for inspecting and certifying equipment and utensils 
used to process livestock and poultry products. Specifically, AMS 
requested comments concerning: initiatives underway in the industry to 
develop a voluntary, consensus sanitary standard for the design and 
manufacture of equipment

[[Page 35858]]

and utensils used to process livestock and poultry products; the 
validity and usability of standards presented to AMS for consideration 
for adoption; criteria to be used by AMS to select a sanitary standard; 
and any other information which would aid AMS in administering the 
program.
    The ANPRM solicited comments on the issue for a 60-day period 
ending September 14, 1999. The public meeting was held on August 10, 
1999, in Room 107-A at the USDA Jamie L. Whitten Building, 12th and 
Jefferson Drive, SW, Washington, DC.
    To assist interested parties in obtaining information on the 
proposed program and in reviewing comments as AMS received them, the 
Agency launched a website at www.ams.usda.gov/lsg/equip.htm/. Contained 
on this website were electronic versions of the AMS press releases 
related to the development of the program, the ANPRM, complete 
transcripts of the August 10, 1999, public meeting, and all comments 
received.
    The public meeting was attended by 42 representatives of the meat 
and poultry packing and processing industry, equipment and utensil 
manufacturing industry, trade and professional associations, standards 
developers, and other interested parties. Twelve individuals provided 
prepared remarks at the meeting.
    AMS received 51 comments during the comment period. One commenter 
submitted two comments requesting an extension of the comment period on 
the ANPRM until December 31, 1999. The agency believes that the 60-day 
comment period on the ANPRM and the public meeting that was held on 
August 10, 1999, gave interested persons sufficient opportunity to 
comment on the ANPRM. Furthermore, interested persons would have an 
opportunity to submit comments on AMS' proposed equipment and utensil 
certification program during the 60-day comment period for this 
proposed rule.
    Nine commenters supported the development of the program. These 
commenters wanted a Government certification program for equipment and 
utensil design as an assurance of quality for buyers. While no 
commenters specifically stated opposition to the development of a 
equipment and utensil certification program, several commenters did 
provide differing recommendations on specific characteristics of such a 
program.
    Several commenters recommended criteria that AMS should use in 
selecting standards to use as the basis of its certification program 
for equipment and utensils used to process livestock and poultry 
products. These criteria were (1) compatibility with current 
regulations, (2) compatibility with current industry practices, (3) 
ability to be understood and used by all interested parties, and (4) 
ability to be revised in a timely manner as regulatory requirements and 
industry practices change. AMS agrees that these criteria are important 
for evaluating proposed standards for equipment and utensil 
certification and has considered them in the development of this 
proposal.
    Several commenters recommended that government employees administer 
the proposed equipment and utensil inspection and certification 
program. AMS agrees. AMS is proposing that Agency employees would 
perform the inspection and certification of equipment and utensils.
    Three commenters recommended AMS offer an accreditation service for 
third parties to administer inspections and certifications of equipment 
and utensils on behalf of the Agency. In complying with the 1999 
Agricultural Appropriations Bill which requires the Secretary of 
Agriculture to develop a program to inspect and certify agricultural 
processing equipment, and impose a fee for the inspection and 
certification, in a manner that is similar to the inspection and 
certification of agricultural products under the AMA, AMS would 
administer the certification program by using government employees.
    One commenter provided criteria they believed should be a part of 
the administration of any certification program involving food safety. 
It is important to note that the purpose of this program is to provide 
a third-party inspection and certification program that equipment and 
utensils used to process livestock and poultry products meet the 
requirements of an identified sanitary standard. It is not to ensure 
food safety per se. Rather, the proposed program is designed to inspect 
and certify that equipment and utensils are capable of producing food 
products in a sanitary manner. The hygienic standards are developed 
with food safety as a primary focus. Hygienically designed equipment 
and utensils are capable of producing safe food. However, equipment and 
utensils meeting any sanitary standard, if not properly cleaned, 
maintained or used can result in the production of unsafe products. 
Equipment and utensil sanitation is only one aspect of food safety. 
FSIS is responsible for ensuring all Federally inspected meat and 
poultry establishments produce safe and wholesome products, regardless 
of whether the equipment and utensils used to process the products was 
certified by AMS under this proposed program.
    Several commenters recommended that the proposed rule also address 
preventing conflicts of interest, employing staff with adequate 
qualifications and training, re-evaluation of equipment and utensils, 
appeals processes, providing a process for investigating reports of 
non-compliance, and control of certification marks. Most of these 
concerns are addressed in this proposed rule. The remaining concerns 
regarding employee conduct and ethics are dealt with in existing AMS 
and USDA instructions, policy and regulations.
    Several commenters stated that any proposed program should be cost-
effective. AMS agrees. The 1999 Agricultural Appropriations Bill 
directs the Secretary of Agriculture to develop this inspection and 
certification program, and impose a fee for the inspection and 
certification, in a manner that similar to the inspection and 
certification of agricultural products under the Agricultural Marketing 
Act of 1946, as amended (AMA). Under the AMA, AMS is required to 
collect reasonable fees for providing official services under 7 CFR 
part 54, including services provided under this proposed equipment and 
utensil certification program, to cover as nearly as practicable AMS 
costs for performing the service including related administrative and 
supervisory costs. Since the procedures used to inspect and certify 
equipment and utensils used to process livestock and poultry products 
are similar to those used to inspect and certify dairy processing 
equipment, AMS has decided to charge the same hourly fees for 
inspecting and certifying equipment and utensils used to process 
livestock and poultry products. Inspection and certification services 
are based on the hourly rate for applicants who request services on an 
hourly basis and appear at 7 CFR part 58 as published in the Federal 
Register at 62 FR 66258 on December 18, 1997. The current base hourly 
rate for such service is $56 per hour for service performed between 
6:00 a.m. and 6:00 p.m. and $61.60 for service performed between 6:00 
p.m. and 6:00 a.m., for the time required to perform the service 
calculated to the nearest 15-minute period, including the time required 
for preparation of certificates and reports and the travel time of the 
equipment review specialist in connection with the performance of the 
service. A minimum charge of one-half hour would be made for the 
service pursuant to each request

[[Page 35859]]

or certificate issued. If an applicant requests that certification 
service be performed on a holiday, Saturday, or Sunday or in excess of 
each 8-hour shift Monday through Friday, the applicant would be charged 
such service at a rate of 1 \1/2\ times the rate which would be 
applicable for such service if performed during normal working hours.
    Each applicant should determine if there is a economic advantage of 
using the service that outweighs the user-fees associated with 
receiving certification.
    One commenter recommended that equipment that had prior approval 
from FSIS and was listed in the discontinued FSIS Directive 11220.1, 
``Acceptable Meat and Poultry Equipment,'' be automatically certified 
as meeting the requirements of the proposed AMS program. AMS does not 
agree. The equipment and utensil certification program proposed herein 
would be based on a new set of sanitary standards, the requirements of 
which differ from the standards used in the former prior approval 
program administered by FSIS. To have equipment and utensils certified 
by AMS, manufacturers would have to resubmit their design of equipment 
and utensils previously approved by FSIS to AMS for evaluation.
    One commenter requested that AMS work with FSIS to educate local 
FSIS inspectors about the proposed program when it begins. This 
suggestion has merit. AMS worked with FSIS during preparation of the 
advance notice of proposed rulemaking, the public meeting, and in the 
development of this proposed rule. AMS would continue to work with FSIS 
as this program develops to ensure FSIS is aware of components of the 
program as it develops.
    Several commenters recommended that the proposed program adopt a 
standard or group of standards which are in harmony with other 
international standards and thus would aid equipment and utensil 
manufacturers in marketing their products internationally. Although the 
international marketing of equipment and utensils could be an allied 
benefit of this program, the primary purpose of this proposed program 
is to provide a third-party certification that equipment and utensils 
meet specified standards. International harmonization was one factor 
considered by AMS in selecting standards to inspect and certify 
equipment and utensils. However, AMS recognizes that international 
standards and foreign buyer requirements can change over time.
    Two voluntary consensus standards bodies transmitted draft 
standards to AMS for consideration as examples of the types of 
standards AMS would inspect and certify to. These voluntary consensus 
standards bodies were the Technical Committee for Underwriters 
Laboratories 2128--the Standard for Meat and Poultry Plant Equipment 
(Underwriters Laboratories, North Brook, Illinois) and the NSF/3-A 
Joint Committee on Food Processing Equipment (a group jointly 
administered by NSF International (formerly the National Sanitation 
Foundation), Ann Arbor, Michigan, and the 3-A Sanitary Standards 
Committees, a standards development group supported by the 
International Association of Food Industry Suppliers, McLean, 
Virginia).
    One group representing a consortium of equipment manufacturing 
associations submitted a draft standard to AMS for consideration as a 
basis for a standard AMS would develop and use as a government-unique 
standard. Additionally, several commenters stated AMS should apply the 
guidelines used by FSIS in its former Equipment Acceptance Program as a 
government-unique standard.
    When considering the comments pertaining to the selection of 
standards for AMS to inspect and certify to, careful attention was paid 
to Circular A-119 of the Office of Management and Budget; Federal 
Participation in the Development and Use of Voluntary Consensus 
Standards and in Conformity Assessment Activities (63 FR 8546). 
Circular A-119 directs Federal agencies to use voluntary consensus 
standards in regulatory activities in lieu of government-unique 
standards except where inconsistent with law or otherwise impractical.
    Voluntary consensus standards bodies are defined by Circular A-119 
as domestic or international organizations which plan, develop, 
establish, or coordinate voluntary consensus standards using agreed-
upon procedures. A voluntary consensus standards body is further 
defined by the following attributes: (1) Openness, (2) balance of 
interest, (3) due process, (4) an appeals process, and (5) consensus.
    Other types of standards, which are distinct from voluntary 
consensus standards, include: (1) Industry standards which are 
developed by the private sector but not in the full consensus process, 
(2) government unique standards which are developed by the government 
for its own uses, and (3) standards mandated by law.
    After reviewing the comments received, AMS believes that two 
standards presented by voluntary consensus standards bodies are 
consistent with Circular A-119. Standards presented or supported by 
other commenters, including the FSIS guidelines and the request that 
AMS develop its own standard were not further pursued. Further, after 
considering the comments received, AMS concluded that there is more 
support for standards developed by the NSF/3-A Joint Committee on Food 
Processing Equipment than those developed by the Technical Committee 
for Underwriters Laboratories 2128--the Standard for Meat and Poultry 
Plant Equipment. Also, commenters stated that the NSF/3-A Joint 
Committee on Food Processing Equipment maintained better participation 
and consensus, and developed standards that contain more fully 
developed criteria necessary for AMS to use in providing an inspection 
and certification program. AMS also has extensive experience in working 
with the voluntary consensus standards for equipment used to process 
dairy products that are developed by the 3-A Sanitary Standards 
Committees through the AMS Dairy Equipment Acceptance Program.
    Therefore, AMS is proposing to inspect and certify equipment and 
utensils to standards developed by the NSF/3-A Joint Committee on Food 
Processing Equipment. This group submitted a proposed generic standard 
titled NSF/3-A 14159-1, ``Hygiene Requirements for the Design of Meat 
and Poultry Processing Equipment.''
    AMS believes the selection of standards developed by the NSF/3-A 
Joint Committee on Food Processing Equipment best meet the stated 
objectives commenters submitted to the Agency for it to use to select a 
standard. AMS believes the broad-based representation on the NSF/3-A 
Joint Committee on Food Processing Equipment will ensure the 
development of standards that are compatible with applicable FSIS 
regulations that apply to federally inspected meat and poultry packing 
and processing establishments, current industry practices, transparent 
and objective requirements, and be able to be revised over time.
    The standards developed by the NSF/3-A Joint Committee on Food 
Processing Equipment, which AMS proposes to adopt as the basis for the 
certification program, would establish minimum hygienic design 
requirements. The requirements are to be applied by designers and 
manufacturers of equipment and utensils. The standards will incorporate 
the following features.

--A scope that clearly defines the intended limits and application of 
the standards;

[[Page 35860]]

--Normative references to other national or international standards 
that are germane to the scope of the standards;
--Definitions to define the terms used within the standards;
--A listing of potential hazards that may arise;
--Hygiene requirements including strategies used by the manufacturer to 
identify hygiene measures, risk assessment, materials of construction, 
design and fabrication requirements for product contact and non-product 
contact surfaces; and
--Information to the users.

    One commenter stated that any sanitary standard adopted by AMS 
should allow all of the options for establishing that equipment, 
utensils and their components have a satisfactory regulatory status for 
materials of construction under the laws and regulations administered 
by the Food and Drug Administration (FDA). The objective of this 
program is to offer a voluntary, user-fee funded service to provide a 
third-party assurance that equipment and utensils meet the requirements 
of a voluntary consensus standard. Because the objective requirements 
of the standard itself are developed and maintained by the NSF/3-A 
Joint Committee on Food Processing Equipment, the commenter's concerns 
pertaining to FDA compliance of food-contact materials are more 
appropriately directed to the NSF/3-A Joint Committee.

The Proposed Regulation

    The equipment and utensil inspection and certification proposed 
herein would be conducted by AMS on a voluntary, fee-for-service basis. 
Manufacturers of new, modified, or reconditioned equipment and utensils 
designed to process livestock and poultry products who want to have the 
equipment and utensils they manufacture officially inspected and 
accepted by AMS as meeting the NSF/3-A standards which outline minimum 
requirements for cleanability, suitability of materials used in 
construction, inspectability and durability would apply to AMS. Copies 
of the NSF/3-A standards may be obtained by contacting the NSF/3-A 
Joint Committee on Food Processing Equipment at: 3475 Plymouth Road, 
Ann Arbor, Michigan 48105, Phone (734) 769-9060 or Fax (734) 769-9064. 
AMS will also have copies of the NSF/3-A standards available for 
inspection at: USDA, AMS Dairy Programs, 1400 Independence Ave, SW, 
Washington, DC 20250, Phone (202) 720-3171 or Fax (202) 720-2643.
    To have equipment and utensils accepted under this program, 
equipment and utensil manufacturers would submit an application to AMS 
requesting evaluation of equipment and utensils. Manufacturers would 
apply by submitting an application and be required to indicate whether 
the evaluation is to be performed on a prototype, manufactured 
equipment and utensils, or drawing and materials list. AMS does not 
require the drawings, blueprints and a material list, however such 
blueprints and lists are encouraged as they may facilitate evaluation 
of equipment complex in design against the standard. It may be 
necessary for AMS to conduct an on-site review of the actual equipment 
at the point of fabrication or installed and operating in an 
establishment to fully evaluate the design and construction and execute 
final acceptance.
    The cost for evaluation of equipment or utensils would depend on 
the complexity of design, location of the equipment or utensil to be 
evaluated on-site, and whether the manufacturer has provided resource 
materials that would facilitate inspection of the equipment or utensils 
by AMS to determine acceptance. Collectively, AMS estimates the average 
total costs to process and in-plant review a piece of equipment or a 
utensil to be $1,120 plus added travel costs for the required on-site 
review. Assuming all equipment and utensil manufacturers would use an 
AMS equipment and utensil certification program to the extent they used 
the FSIS program, it is estimated that the total cost to the industry 
under an AMS program would be about $2,800,000 plus travel costs for 
on-site reviews annually.
    Manufacturers whose equipment and utensils receive AMS acceptance 
may, upon request, be issued an official certificate as proof that the 
equipment or utensil meets NSF/3-A standards and is therefore accepted. 
Upon written application, manufacturers of accepted equipment and 
utensils may receive permission to display the official mark of 
acceptance on equipment and utensils or in promotional literature as 
illustrated in the regulatory text (Figure 1).
    Manufacturers whose equipment or utensil does not meet the design 
and fabrication requirements of the NSF/3-A standards and does not 
receive acceptance by AMS may appeal AMS' determination. The 
manufacturers would make a request for appeal service with the Chief, 
Dairy Grading Branch by completing and submitting a request for service 
to have equipment or utensils reevaluated. The appeal process is set 
forth in Sec. 54.1020 through 54.1027 of the proposed regulations.
    Any manufacturer whose equipment or utensil has been accepted shall 
resubmit the design and fabrication details of the accepted equipment 
or utensils whenever a change of design or fabrication has occurred. 
Acceptance of equipment or utensils that have not changed remains in 
effect for a period of four years. If no changes in equipment or 
utensil design or fabrication have occurred over the four year period 
since the last acceptance was made, manufacturers must submit a 
certificate of conformance signed by the chief engineering officer and 
chief executive officer of the company stating that no design changes 
have been made to receive acceptance renewal.
    As was stated in the May 10, 1999, AMS News Release, this proposed 
equipment and utensil certification program will be operated by the AMS 
Dairy Programs. This decision was made because the AMS Dairy Programs 
has extensive technical expertise and many years of experience in 
working with domestic and international standards organizations and 
equipment manufacturers for the acceptance of dairy processing 
equipment.

Executive Order 12866 and the Regulatory Flexibility Act

    This proposed rule has been reviewed under Executive Order 12866. 
The rule has been determined to be not significant for the purposes of 
Executive Order 12866 and, therefore, has not been reviewed by the 
Office of Management and Budget.
    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (RFA) (5 U.S.C. 601 et seq.), AMS has considered the 
economic impact of this proposed rule on small entities. The purpose of 
the RFA is to fit regulatory actions to the scale of businesses subject 
to such action so that small businesses would not be disproportionally 
burdened. Accordingly, we have prepared an initial regulatory 
flexibility analysis.
    Development of this proposed program was authorized by the 1999 
Agricultural Appropriations Bill (Pub. L. 105-277, sec. 747) and under 
the authority of the Agricultural Marketing Act of 1946 (AMA) (7 U.S.C. 
1621-1627).
    AMS is proposing to conduct a voluntary, user-fee funded inspection 
and certification program for equipment and utensils that are used to 
process livestock and poultry products that is similar to the 
inspection and certification of agricultural products under the AMA. 
Under this proposed program, manufacturers of new, modified, or 
reconditioned equipment

[[Page 35861]]

and utensils designed to process livestock and poultry products who 
want to have the equipment and utensils they manufacture officially 
inspected and accepted by AMS as meeting the NSF/3-A standards which 
outline minimum requirements for cleanability, suitability of materials 
used in construction, inspectability and durability would apply to AMS.
    Alternatively, AMS could establish through rulemaking a process to 
approve private parties who could then perform inspection and 
acceptance on behalf of AMS. However it was determined that in 
complying with the authorizing legislation for this program which 
requires the Secretary to develop a program to inspect and certify 
agricultural processing equipment, and impose a fee for the inspection 
and certification, in a manner similar to the inspection and 
certification of agricultural products under the Agricultural Marketing 
Act of 1946, AMS would administer this proposed program by using 
government employees.
    Additionally, AMS considered proposing alternative standards as the 
basis of its inspection and certification program. However, AMS 
believes that the standards proposed herein represent the best 
alternative taking into account the program's requirements.
    Under this proposed equipment and utensil acceptance program, 
equipment and utensil manufacturers seeking AMS acceptance and 
certification would apply to AMS for an evaluation of their equipment 
and utensils. Although AMS does not require the drawings, blueprints 
and a material list upon application, AMS encourages applicants to 
submit such blueprints and lists to facilitate evaluation of complex 
equipment and utensils. Additionally, some equipment and utensils will 
require AMS to conduct an on-site review at the point of fabrication or 
installed and operating in an establishment to fully evaluate the 
design and construction and execute final acceptance.
    To maintain acceptance and certification, these regulations would 
require any manufacturer whose equipment or utensil has been accepted 
to resubmit the design and fabrication details of the accepted 
equipment or utensils whenever a change of design or fabrication 
occurs. Barring changes in equipment or utensil design and fabrication, 
acceptance is granted for a four year period. When equipment or utensil 
acceptance nears expiration at the end of the four year period, 
manufacturers may send a letter stating that no design changes have 
been made to receive an additional four year acceptance renewal.
    This action will benefit manufacturers of equipment and utensils 
used for processing meat and poultry products and the purchasers of 
such equipment and utensils by providing AMS certification that the 
equipment and utensils meet the minimum requirements of voluntary 
consensus standards for sanitary design. Acceptance by AMS will provide 
manufacturers and buyers assurance that equipment and utensils can be 
cleaned, are constructed of suitable materials, are durable, and can be 
inspected.
    This proposed equipment and utensil inspection and certification 
program affects manufacturers or other vendors of equipment and 
utensils. The equipment and utensil manufacturers range in size from 
small to large concerns. According to the Standard Industrial 
Classification (SIC) (13 CFR 121.201) which are used by the Small 
Business Administration to identify small businesses, a small business 
equipment and utensil manufacturer is defined a firm with less than 500 
employees (SIC Division D. Major Group 20). According to the most 
complete data available to AMS, it is estimated that there are about 
2000 equipment and utensil manufacturers, about 90 percent of these can 
be classified as small entities.
    Previously, FSIS maintained a mandatory prior approval program for 
equipment and utensil inspection as a prerequisite for use in Federally 
inspected meat and poultry packing and processing establishments that 
affected these same entities. Under FSIS' former mandatory prior 
approval program for equipment, an estimated 2,500 applications for 
equipment approval were received each year. Evaluation and 
certification of equipment and utensils is based on the complexity and 
sophistication of the design and fabrication of the equipment or 
utensil being evaluated.
    The paperwork burden that may be imposed on equipment and utensil 
manufacturers by this proposed action is further discussed in the 
section entitled Paperwork Reduction Act that follows.
    In addition, we have not identified any relevant Federal rules that 
are currently in effect that duplicate, overlap, or conflict with this 
rule. Further, as discussed below, this program will be operated by the 
AMS Dairy Programs using its relevant fee structure.
    The 1999 Agricultural Appropriations Bill directed the Secretary of 
Agriculture to develop this inspection and certification program for 
equipment used to process livestock and poultry products in a manner 
similar to other inspection and certification programs administered by 
AMS under the authority of the Agricultural Marketing Act of 1946. 
Under the Agricultural Marketing Act of 1946, AMS is required to 
collect reasonable fees for providing official services provided under 
this proposed equipment and utensil certification program, to cover as 
nearly as practicable AMS costs for performing the service including 
related administrative and supervisory costs. Since the procedures used 
to inspect and certify equipment and utensils used to process livestock 
and poultry products are similar to those used to inspect and certify 
dairy processing equipment, AMS has decided to charge the same hourly 
fees for inspecting and certifying equipment used to process livestock 
and poultry products. Inspection and certification services are based 
on the hourly rate for applicants who request services on an hourly 
basis and appear at 7 CFR part 58 as published in the Federal Register 
at 62 FR 66258 on December 18, 1997. The current base hourly rate for 
such service is $56 per hour for service performed between 6:00 a.m. 
and 6:00 p.m. and $61.60 for service performed between 6:00 p.m. and 
6:00 a.m., for the time required to perform the service calculated to 
the nearest 15-minute period, including the time required for 
preparation of certificates and reports and the travel time of the 
equipment review specialist in connection with the performance of the 
service. A minimum charge of one-half hour will be made for the service 
pursuant to each request or certificate issued. If an applicant 
requests that certification service be performed on a holiday, 
Saturday, or Sunday or in excess of each 8-hour shift Monday through 
Friday, the applicant would be charged such service at a rate of 1\1/2\ 
times the rate which would be applicable for such service if performed 
during normal working hours.
    AMS estimates that the time required to review and accept an 
initial submission for simple designs would be 1 hour. For complex 
designs, AMS estimates that the time required to review and accept an 
initial submission would be 8 hours. Based on the proposed AMS base 
hourly fee for service of $56 per hour, an initial submission of 
assembly type drawings and corresponding parts and material lists 
should range from $56 to $448. However, the final cost for equipment or 
utensil inspection and certification

[[Page 35862]]

would be contingent on a final on-site review of the equipment or 
utensil at the point of fabrication or under conditions of actual use. 
The cost of this on-site review would include associated travel and per 
diem costs in addition to the hourly fee for service. AMS estimates the 
average time to perform a on-site review for a piece of equipment or 
utensil to be 12 hours.
    The cost for evaluation of equipment or utensils would depend on 
the complexity of design, location of the equipment or utensil to be 
evaluated on-site, and whether the manufacturer has provided resource 
materials that would facilitate inspection of the equipment or utensil 
by AMS to determine acceptance. AMS estimates the average total costs 
to process and in-plant review a piece of equipment or utensil to be 
$1,120 plus added travel costs for the required on-site review. 
Assuming all equipment and utensil manufacturers would use an AMS 
equipment and utensil certification program to the extent they used the 
FSIS program, it is estimated that the total cost to the industry under 
an AMS program would be about $2,800,000 plus travel costs for on-site 
reviews annually. Since approximately 90 percent of equipment and 
utensil manufacturers are small businesses, the estimated share of the 
total annual industry burden directly affecting small businesses would 
be $2,520,000.
    In assessing alternatives to the scheme provided for in these 
proposed regulations, we believe that the provisions contained herein 
would best accomplish its purpose and at the same time minimize any 
burden that might be placed upon affected parties. Nonetheless, we 
invite comments concerning the potential effects of this proposed 
regulation on affected parties, including more information on the 
benefits or burden that small entities may incur as a result of 
implementation of this proposal.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform and is not intended to have a retroactive effect. This 
rule would not preempt any State or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with this 
rule. Further, section 747 of the 1999 Agricultural Appropriations Bill 
states that the provision does not affect the authority of the 
Secretary to carry out the Federal Meat Inspection Act (21 U.S.C. 601 
et seq.); the Poultry Products Inspection Act (21 U.S.C. 451 et seq.); 
or the Egg Products Inspection Act (21 U.S.C. 1031 et seq.). There are 
no administrative procedures that must be exhausted prior to any 
judicial challenge to the provisions of this proposed rule.

Paperwork Reduction Act Requirements

    This proposed rule contains paperwork submission requirements that 
are subject to public comment and to review by the Office of Management 
and Budget under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 
Chapter 35). In accordance with 5 CFR part 1320, we included the 
description of the reporting requirements and an estimate of the annual 
burden on manufacturers of equipment and utensils used to process 
livestock and poultry products. As identified in Sec. 54.1004 of these 
proposed regulations, the Certification of Sanitary Design and 
Fabrication of Equipment Used in the Slaughter, Processing, and 
Packaging of Livestock and Poultry Products service would be 
administered by the Dairy Programs of AMS. During the administration of 
the service, Dairy Programs will expand the use of existing Dairy 
Programs forms currently approved by OMB under 7 CFR part 58, subpart 
A, Regulations Governing the Inspection and Grading of Manufactured or 
Processed Dairy Products. The Agency published a Federal Register 
Notice 65 FR 2370, dated January 14, 2000, that expanded the use of 
these forms and allowed for a 60-day comment period. The following is 
provided in this proposed action to allow for an additional opportunity 
for public comment on the specified burden that would be placed on 
those entities affected by this rule.
    OMB Number: 0581-0126.
    Expiration Date of Approval: July 31, 2001.
    Abstract: The dairy grading program is a voluntary, user-fee funded 
program. In order for a voluntary inspection program to perform 
satisfactorily with a minimum of confusion, there must be written 
requirements and rules for both Government and industry. The 
information collections are essential to carry out and administer the 
inspection and grading program. The information requested is used to 
identify the product offered for grading, to identify a request from an 
equipment manufacturer of equipment used in the dairy, meat or poultry 
industries for evaluation for sanitary design and construction, to 
identify and contact the party responsible for payment of the 
inspection, grading or equipment evaluation fee and expense, to 
identify applicants who wish to be authorized for the display of 
official identification on product packaging materials, equipment, 
utensils, or on descriptive or promotional materials.
    The equipment and utensil inspection and certification proposed 
herein would use the forms described above in a program that would be 
conducted by AMS on a voluntary, fee-for-service basis. Manufacturers 
of new, modified, or reconditioned equipment and utensils designed to 
process livestock and poultry products who want to have the equipment 
or utensils they manufacture officially inspected and accepted by AMS 
as meeting the NSF/3-A standards which outline minimum requirements for 
cleanability, suitability of materials used in construction, 
inspectability and durability would apply to AMS.
    For the purposes of this burden estimate, AMS estimates that the 
hourly wage for those submitting information would be $20 per hour. To 
have equipment and utensils accepted under this program, equipment and 
utensil manufacturers would submit an application to AMS requesting 
evaluation of equipment or utensils (Form DA-162). AMS estimates that 
of the 2000 livestock and poultry equipment and utensil manufacturers, 
AMS will receive approximately 2500 applications per year or, on 
average, 1.25 applications from each manufacturer. Form DA-162 requires 
0.038 hours to complete. The total annual burden on the industry for 
this proposed collection of information would be 95 hours or $1,900 
annually. Since AMS does not require the drawings, blueprints and a 
material list to be submitted, they have not been included in this 
burden estimate.
    Manufacturers whose equipment or utensil receives AMS acceptance 
may, upon request, be issued an official certificate as proof that the 
equipment or utensil meets NSF/3-A standards and is therefore accepted. 
Since completion of this certificate is performed by AMS, it has also 
not been included in this burden estimate. Upon written application 
(Form DA-155 and Form DA-156), manufacturers of accepted equipment or 
utensils may receive permission to display the official mark of 
acceptance on equipment and utensils, or in promotional literature as 
illustrated in the regulatory text (Figure 1). Form DA-155 is a one-
time application from each manufacturer, and therefore has been 
estimated to only be sent by a respondent once in every four-year cycle 
of equipment and utensil approval. The estimate of the total annual 
burden of this collection of information is 10.5 hours or $210 
annually. Form DA-156 is submitted by

[[Page 35863]]

a manufacturer each time there is a request to use the symbol on a 
piece of equipment or utensil, or in promotional literature. AMS 
estimates that it would receive one request each year to use the symbol 
on equipment or utensils, or in promotional material for each piece of 
equipment or utensil accepted. Therefore, AMS estimates that the total 
annual burden for this collection of information would be 42.5 hours or 
$850 annually.
    Manufacturers whose equipment or utensil does not meet the design 
and fabrication requirements of the NSF/3-A standards and does not 
receive acceptance by AMS may appeal AMS' determination. The 
manufacturers would make a request for appeal service with the Chief, 
Dairy Grading Branch by completing and submitting a request for service 
(Form DA-162) to have equipment or utensils reevaluated. The appeal 
process is set forth in sections Sec. 54.1020 through Sec. 54.1027 of 
the proposed regulations. As the AMS Dairy Program has never received 
an appeal for service under its current equipment acceptance program, 
AMS has estimated that 1% of applicants will appeal service in this 
estimate of the burden of the collection of information. Accordingly, 
with 2500 applications per year and Form DA-162 requiring 0.038 hours 
to complete and an estimate of only 1 percent of applicants requiring 
an appeal, the total annual burden on the industry for this proposed 
collection of information would be 0.95 hours or $19 annually.
    Any manufacturer whose equipment or utensil has been certified 
shall resubmit the design and fabrication details of the certified 
equipment or utensil whenever a change of design or fabrication has 
occurred. Certification of equipment or utensils that have not changed 
remains in effect for a period of four years. If no changes in 
equipment or utensil design or fabrication have occurred over the four 
year period since the last certification was made, manufacturers must 
submit a certificate of conformance signed by the chief engineering 
officer and chief executive officer of the company stating that no 
design changes have been made to receive certification renewal. AMS 
estimates that it would receive one such request every four years for 
each piece of equipment or utensil accepted. AMS estimates that the 
total annual burden for this collection of information would be 52 
hours or $1,040 annually.
    Collectively, AMS estimates that the total annual burden for the 
collection of information would be 200.95 hours or $4019 annually.
    1. Equipment Review Request--Form DA-162.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 0.038 hours per response.
    Respondents: Manufacturers of equipment and utensils used to 
process livestock and poultry products.
    Estimated Number of Respondents: 2000.
    Estimated Number of Responses per Respondent: 1.25.
    Estimated Total Annual Burden on Respondents: 95 hours.
    Total Cost: $1,900.
    2. Application to use official ID--Form DA-155.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 0.021 hours per response.
    Estimated number of respondents: 2000.
    Estimated Number of Responses per Respondent: 0.250.
    Estimated Total Annual Burden on Respondents: 10.5 hours.
    Total Cost: $210.
    3. Request to Display Official ID--Form DA-156.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 0.017 hours per response.
    Estimated number of respondents: 2000.
    Estimated Number of Responses per Respondent: 1.25.
    Estimated Total Annual Burden on Respondents: 42.5 hours.
    Total Cost: $850.
    4. Appeal--Equipment Review Request--Form DA-162.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 0.038 hours per response.
    Respondents: Manufacturers of equipment and utensils used to 
process livestock and poultry products.
    Estimated Number of Respondents: 2000.
    Estimated Number of Responses per Respondent: 0.0125.
    Estimated Total Annual Burden on Respondents: 0.95 hours.
    Total Cost: $19.
    5. Letter requesting renewal of acceptance.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 0.083 hours per response.
    Estimated number of respondents: 2000.
    Estimated Number of Responses per Respondent: 0.313.
    Estimated Total Annual Burden on Respondents: 52 hours.
    Total Cost: $1,040.
    Estimated Total Annual Burden on Respondents: 200.95 hours total or 
0.1 hours per respondent.
    Estimated Total Annual Costs: $4,019 or $2 per respondent.
    AMS is soliciting comments from all interested parties concerning 
the information collection requirements contained in this proposed 
rule. Comments are specifically invited on the following: (1) The 
accuracy of the agency's burden estimate of the proposed collection of 
information including the validity of the methodology and assumptions 
used; (2) ways to minimize the burden of the collection of information 
on those who would respond, including through the use of appropriate 
electronic collection methods; (3) whether the proposed collection of 
information is sufficient or necessary for the proper performance of 
the functions of the agency to perform this program; and (4) ways to 
enhance the quality, utility, and clarity of the information to be 
collected.
    Send two copies of comments concerning the collection requirements 
of this proposed rule to Barry L. Carpenter, Deputy Administrator, 
Livestock and Seed Program, Docket No. LS-99-12, Room 2092 South 
Agriculture Building, 1400 Independence Ave., SW, Washington, DC 20250-
0249.
    All comments received in response to this notice will be considered 
part of the public record and will be available for viewing in Room 
2092 South Agriculture Building, 1400 Independence Ave., SW, 
Washington, DC 20250-0249 between 8:30 a.m. and 4:30 p.m., Monday 
through Friday.
    Comments concerning the information collection under the PRA should 
also be sent to the Desk Officer for Agriculture, Office of Information 
and Regulatory Affairs, Office of Management and Budget, Washington, DC 
20503.

List of Subjects in 7 CFR Part 54

    Food grades and standards, Food labeling, Meat and meat products.
    For the reasons set forth in the preamble 7 CFR part 54 is proposed 
to be amended as follows:

PART 54--MEATS, PREPARED MEATS, AND MEAT PRODUCTS (GRADING, 
CERTIFICATION, AND STANDARDS)

    1. The authority citation for part 54 is revised to read as 
follows:

    Authority: 7 U.S.C. 1621-1627; Pub. L. 105-277, sec. 747)


[[Page 35864]]


    2. In part 54 a new subpart C consisting of Secs. 54.1001 through 
54.1034 is added to read as follows:

Subpart C--Regulations Governing the Certification of Sanitary 
Design and Fabrication of Equipment Used in the Slaughter, 
Processing, and Packaging of Livestock and Poultry Products

Sec.
54.1001   Meaning of words.
54.1002   Terms defined.
54.1003   Designation of official certificates, memoranda, marks, 
and other identifications for purposes of the Agricultural Marketing 
Act of 1946.
54.1004   Administration and implementation.
54.1005   Basis of service.
54.1006   Kind of service.
54.1007   Availability of service.
54.1008   How to obtain service.
54.1009   Order of furnishing service.
54.1010   When request for service deemed made.
54.1011   Withdrawal of application or request for service.
54.1012   Authority of agent.
54.1013   When an application may be rejected.
54.1014   Accessibility of equipment and utensils; access to 
establishments.
54.1015   Official reports, forms, and certificates.
54.1016   Advance information concerning service rendered.
54.1017   Authority to use official identification.
54.1018   Form of official identification and approval for use.
54.1019   Renewal of Acceptance Certification.
54.1020   Appeal service; marking products or appeal; requirements 
for appeal; certain determinations not appealable.
54.1021   Request for appeal service.
54.1022   When request for appeal service may be withdrawn.
54.1023   Denial or withdrawal of appeal service.
54.1024   Who shall perform appeal service.
54.1025   Appeal reports.
54.1026   Superseded reports.
54.1027   Application of other regulations to appeal service.
54.1028   Fees and other charges for service.
54.1029   Payment of fees and other charges.
54.1030   Identification.
54.1031   Errors in service.
54.1032   Denial or withdrawal of service.
54.1033   Confidential treatment.
54.1034   OMB control numbers assigned pursuant to the Paperwork 
Reduction Act.

Subpart C--Regulations Governing the Certification of Sanitary 
Design and Fabrication of Equipment Used in the Slaughter, 
Processing, and Packaging of Livestock and Poultry Products


Sec. 54.1001  Meaning of words.

    For the purposes of the regulations in this subpart, words in the 
singular form shall be deemed to impart the plural and vice versa, as 
the case may demand.


Sec. 54.1002  Terms defined.

    Act. The Agricultural Marketing Act of 1946, as amended (7 U.S.C. 
1621-1627).
    Administrator. The Administrator of the Agricultural Marketing 
Service (AMS), United States Department of Agriculture, or the 
representative to whom authority has been delegated to act in the stead 
of the Administrator.
    Agricultural Marketing Service (AMS). The Agricultural Marketing 
Service of the United States Department of Agriculture.
    Applicant. Any person who applies for service under the regulations 
in this subpart.
    Branch. The Dairy Grading Branch, Dairy Programs, Agricultural 
Marketing Service.
    Chief. The Chief of the Dairy Grading Branch, Dairy Programs, 
Agricultural Marketing Service, or the representative to whom authority 
has been delegated to act in the stead of the Chief.
    Compliance. Conformity of a processing system, piece of processing 
equipment, or a utensil to identified specifications or standards.
    Department. The United States Department of Agriculture.
    Deputy Administrator. The Deputy Administrator of the Dairy 
Programs of the Agricultural Marketing Service or any officer or 
employee of the Dairy Programs to whom authority has heretofore been 
delegated, or to whom authority may hereafter be delegated to act in 
the stead of the Deputy Administrator.
    Design Review Specialist. An employee of the Branch to determine 
and certify or otherwise evaluate the compliance of equipment or 
utensils under the regulations.
    Design Evaluation and Certification Service. The service 
established and conducted under the regulations for the evaluation and 
certification or other identification of the compliance of equipment or 
utensils used for the slaughter, processing or packaging of livestock 
and poultry products (Referred to hereinafter as ``equipment'' or 
``utensils'') with sanitary specifications or standards.
    Fabricator. Commercial entity engaged in the manufacture or 
assembly of equipment or utensils.
    Financially interested person. Any person having a financial 
interest in the equipment or utensils involved, including but not 
limited to the designer, fabricator, or user of the equipment or 
utensils.
    Legal Holiday. Those days designated as legal public holidays in 
Title 5, United States Code, section 6103(a).
    Person. Any individual, partnership, corporation, or other legal 
entity, or Government agency.
    Processing. Cooking, baking, curing, heating, drying, mixing, 
grinding, churning, separating, extracting, cutting, fermenting, 
eviscerating, preserving, dehydrating, freezing, or otherwise 
manufacturing, and includes the packaging, canning, jarring, or 
otherwise enclosing in a container.
    Program. The Dairy Programs of the Agricultural Marketing Service.
    Standards. The most recent version of standards for equipment and 
utensils formulated by the NSF/3-A Joint Committee on Food Processing 
Equipment (Referred to hereinafter as ``NSF/3-A'').
    The regulations. The regulations in this Subpart.


Sec. 54.1003  Designation of official certificates, memoranda, marks, 
and other identifications, for purposes of the Agricultural Marketing 
Act of 1946.

    Subsection 203(h) of the Agricultural Marketing Act of 1946, as 
amended provides criminal penalties for various specified offenses 
relating to official certificates, memoranda, and marks or other 
identifications, issued or authorized under section 203 of said Act, 
and certain misrepresentations concerning the inspection or grading of 
agricultural products under said section. For the purposes of said 
subsection and the provisions in this subpart, the terms listed in 
paragraphs (a) through (c) of this section shall have the respective 
meanings specified:
    (a) Official certificate means any form of certification, either 
written or printed, used under the regulations to certify with respect 
to the evaluation, review, condition, or acceptance of equipment or 
utensils (including the compliance of equipment or utensils with 
applicable standards).
    (b) Official memorandum means any initial record of findings made 
by an authorized employee of the Dairy Grading Branch in the process of 
determining compliance, evaluating, or reviewing equipment or utensils 
pursuant to the regulations, any processing or in plant-operation 
report made by an authorized Dairy Grading Branch employee in 
connection with determining compliance, evaluating, or reviewing 
equipment or utensils under the regulations, and any report made by an 
authorized employee of the Dairy Grading Branch of any other services 
performed pursuant to the regulations.
    (c) Official mark or other official identification means any form 
of mark

[[Page 35865]]

or other identification, including those prescribed in Sec. 54.1018; 
used under the regulations in marking any equipment or utensils or 
displayed as an indication that the equipment or utensils has been 
evaluated by AMS (including the compliance of the equipment or utensils 
with applicable standards).


Sec. 54.1004  Administration and implementation.

    The Administrator designates the administration and implementation 
of the Certification of Sanitary Design and Fabrication of Equipment 
Used in the Slaughter, Processing, and Packaging of Livestock and 
Poultry Products service to the Dairy Grading Branch, Dairy Programs, 
Agricultural Marketing Service. The Chief is charged with the 
administration, under the general supervision and direction of the 
Deputy Administrator, of the regulations and the Act insofar as they 
relate to equipment or utensils used to process livestock and poultry 
products.


Sec. 54.1005  Basis of service.

    (a) Certification of Sanitary Design and Fabrication of Equipment 
Used in the Slaughter, Processing, and Packaging of Livestock and 
Poultry Products service shall be performed in accordance with the 
provisions of this subpart, the instructions, guidelines and procedures 
issued or approved by the Chief and the applicable standards developed 
by the NSF/3-A.
    (b) Copies of standards developed by NSF/3-A that AMS will inspect 
and certify to are available, for a nominal fee, from NSF 
International, 3475 Plymouth Road, Ann Arbor, MI 48105; www.nsf.org; 
Phone (800) 673-6275; Fax (734) 769-9064. Copies of all other 
instructions, guidelines and procedures can be obtained from, and 
copies of standards developed by NSF/3-A may be inspected at, the U.S. 
Department of Agriculture, Agricultural Marketing Service, Dairy 
Programs, Dairy Grading Branch; Room 2750-S; 1400 Independence Ave., 
SW., Washington, DC 20250-6456.
    (c) All services provided in accordance with the regulations shall 
be rendered without discrimination on the basis of race, color, 
national origin, gender, religion, age, disability, political beliefs, 
sexual orientation, or marital or family status.


Sec. 54.1006  Kind of service.

    Certification of Sanitary Design and Fabrication of Equipment Used 
in the Slaughter, Processing, and Packaging of Livestock and Poultry 
Products service under the regulations shall consist of the evaluation, 
certification and/or identification, upon request by the applicant, of 
the adherence of the design and fabrication of equipment and utensils 
to sanitary principles and criteria under applicable standards 
identified in this subpart. Determination as to equipment or utensils 
compliance with standards for materials of fabrication or method of 
fabrication may be based upon information received from the fabricator.


Sec. 54.1007  Availability of service.

    Service under these regulations may be made available to the 
designers, fabricators, users, or other interested person or party, of 
the equipment or utensils. Subject to the provisions of this subpart, 
services shall be performed only when a qualified design review 
specialist is available, and when the location of the equipment or 
utensils, evaluation facilities and conditions, as determined by the 
Chief, are suitable for conducting such service.


Sec. 54.1008  How to obtain service.

    (a) Application. Any person may apply to the Chief for service 
under the regulations with respect to equipment or utensils in which 
the applicant is financially interested. The application shall be made 
on a form approved by the Chief. In any case in which the service is 
intended to be furnished at an establishment not operated by the 
applicant, the applicant shall be responsible for obtaining approval 
for accessibility of the equipment or utensil from the operator of such 
establishment and such approval shall constitute an authorization for 
any employees of the Department to enter the establishment for the 
purpose of performing their functions under the regulations. The 
application shall state:
    (1) The name and address of the establishment at which service is 
desired;
    (2) The name and post office address of the applicant;
    (3) Identification of the party that will be responsible for 
payment of all services rendered in response to the request;
    (4) The type of equipment or utensil presented for evaluation;
    (5) The date(s) on which service is requested to be performed; and
    (6) The signature of the applicant (or the signature and title of 
the applicant's representative) and date of the request.
    (b) Notice of eligibility for service. The applicant for service 
will be notified whether the applicant's application is approved.


Sec. 54.1009  Order of furnishing service.

    Service under the regulations shall be furnished to applicants, 
insofar as practicable and subject to the availability of qualified 
design review specialist, in the order in which requests therefor are 
received, insofar as consistent with good management, efficiency and 
economy. Precedence will be given, when necessary, to requests made by 
any government agency and to requests for appeal service under 
Sec. 54.1021.


Sec. 54.1010  When request for service deemed made.

    A request for service under the regulations shall be deemed to be 
made when received by the Branch. Records showing the date and time of 
the request shall be maintained.


Sec. 54.1011  Withdrawal of application or request for service.

    An application or a request for service under the regulations may 
be withdrawn by the applicant at any time before the application is 
approved or prior to performance of service. The applicant shall be 
responsible for payment, in accordance with Secs. 54.1028 and 54.1029, 
of any expenses already incurred by the Agricultural Marketing Service 
in connection therewith.


Sec. 54.1012  Authority of agent.

    Proof of the authority of any person making an application or a 
request for service under the regulations on behalf of any other person 
may be required at the discretion of the Deputy Administrator or Chief 
or other employee receiving the application or request under 
Sec. 54.1008.


Sec. 54.1013  When an application may be rejected.

    (a) An application or a request for service may be denied by the 
design review specialist, with the concurrence of the Deputy 
Administrator or Chief:
    (1) For administrative reasons such as the non-availability of 
personnel to perform the service;
    (2) In case the application or request relates to equipment or 
utensils which are not eligible for service under Sec. 54.1006;
    (3) The applicant fails to meet either the application requirements 
prescribed in this subpart or the conditions for receiving such 
service;
    (4) The equipment or utensil is owned by, or located on the 
premises of, a person currently denied the benefits of the Act;
    (5) The applicant has substantial financial ties to a person who is 
currently denied the benefits of the Act, or who has been adjudged, in 
an administrative or judicial proceeding, responsible in any way for a 
current

[[Page 35866]]

denial of benefits of the Act to any other person.
    (6) The applicant is currently denied services under the Act.
    (7) Any fees billed to the applicant are not paid within 30 days; 
or
    (8) The applicant has failed to comply with the Act or this subpart 
or with the instructions, guidelines or procedures issued hereunder.
    (b) The Chief shall provide notice to an applicant whose 
application is rejected, and shall explain the reason(s) for the 
rejection. If such notification is made verbally, written confirmation 
may be provided.


Sec. 54.1014  Accessibility of equipment and utensils; access to 
establishments.

    (a) The applicant shall cause equipment and utensils to be made 
easily accessible for examination and to be so placed, with adequate 
illumination to facilitate evaluation for compliance. The applicant 
shall furnish or make available any necessary tools; such as boroscope, 
profilometer, disassembly tools, ladders, radius gauges, and the like; 
necessary to complete the evaluation.
    (b) Supervisors of USDA design review specialists responsible for 
maintaining uniformity and accuracy of service under the regulations 
shall have access to all parts of establishments covered by approved 
applications for service under the regulations, for the purpose of 
examining all equipment or utensils in the establishments which have 
been or are to be evaluated for compliance with standards or which bear 
any marks of compliance.


Sec. 54.1015  Official reports, forms, and certificates.

    (a) Report. The design review specialist shall prepare, sign, and 
issue a narrative report covering the observations, comments and 
recommendations based on the evaluation for conformance with standards 
of equipment and utensils as provided for in Sec. 54.1005 and indicate 
the fees and other charges incurred for the services rendered.
    (b) Forms. Form DA-161 is the official certificate for equipment or 
utensils evaluated and is accepted under the regulations. Issuance of 
this certificate is optional at the request of the applicant.
    (c) Distribution. The original report and official certificate (if 
requested) shall be delivered or mailed to the applicant or other 
persons designated by the applicant. Other copies shall be forwarded as 
required by agency, program, and branch instructions. Additional copies 
will be furnished to any person financially interested in the equipment 
or utensil involved with the concurrence of the applicant and upon 
payment of fees, as provided in Secs. 54.1028 and 54.1029.


Sec. 54.1016  Advance information concerning service rendered.

    Upon request of any applicant, all or any part of the contents of 
any report issued to the applicant under the regulations, or other 
notification concerning the determination of compliance of equipment or 
utensils for such applicant may be transmitted by facsimile 
transmission to the applicant, or to any person designated by the 
applicant at the applicant's expense.


Sec. 54.1017  Authority to use official identification.

    The Chief may authorize an applicant or any persons designated by 
the applicant to use the official identification symbol to mark 
equipment or utensils, or for display in descriptive or promotional 
materials providing the equipment or utensils is evaluated pursuant to 
this subpart and found to be in compliance.


Sec. 54.1018  Form of official identification and approval for use.

    (a) The official identification symbol approved for use on 
equipment, utensils, or descriptive or promotional materials shall 
appear in the form and design shown in Figure 1.
    (b) The official identification symbol on equipment or utensils 
shall be displayed by etching or the placement of a non-removable 
sticker located in close proximity to the equipment identification 
plate.
    (c) The official identification symbol shall be sufficiently large 
to be identifiable and legible.
    (d) The official identification symbol shall not be used in 
descriptive and promotional materials without prior approval by the 
Chief. The official identification symbol, if used, on the descriptive 
or promotional materials shall be printed as part of the text or 
format.
    (e) An applicant shall submit to the Chief of the Dairy Grading 
Branch, Dairy Programs, Agricultural Marketing Service, U.S. Department 
of Agriculture, PO Box 96456, Washington, DC 20090-6456, an 
application, if one is not on file, requesting approval to use the 
official identification symbol on officially accepted equipment and in 
descriptive or promotional materials.

BILLING CODE 3410-02-P

[[Page 35867]]

[GRAPHIC] [TIFF OMITTED] TP06JN00.002

BILLING CODE 3410-02-C


Sec. 54.1019  Renewal of acceptance certification.

    Any equipment and utensil which has been issued a report or 
certification stating acceptance of compliance, or approval to display 
official identification shall resubmit the design and fabrication 
details of the equipment or utensil whenever a change of design or 
fabrication has occurred but in no case longer than four years after 
the date of the most recent report stating acceptance of compliance. If 
no design or fabrication changes have been made, the applicant may 
submit a certificate of conformance signed by the chief engineering 
officer and the chief executive officer of the company stating that no 
design changes have been made to the specified equipment or utensil.


Sec. 54.1020  Appeal service; marking equipment or utensils on appeal; 
requirements for appeal; certain determinations not appealable.

    (a) Appeal service is a re-evaluation of the compliance of a piece 
of equipment, portion of a piece of equipment, or utensil to design or 
fabrication criteria according to the standards prescribed by this 
subpart.
    (b) Only the original applicant or their representative may request 
appeal service requesting a reevaluation on the original determination 
of the design and fabrication of the equipment or utensil for 
compliance with the standards specified in this subpart.
    (c) Appeal service will not be furnished for:
    (1) A piece of equipment, portion of a piece of equipment, or 
utensil which has been altered or has undergone a material change since 
the original service.
    (2) For the purpose of obtaining an up-to-date report or 
certificate which does not involve a question as to the correctness of 
the original service for the piece of equipment, portion of a piece of 
equipment, or utensil.

[[Page 35868]]

Sec. 54.1021  Request for appeal service.

    (a) Except as otherwise provided in Sec. 54.1020, an applicant or 
other persons who have a financial interest in a piece of equipment, 
portion of a piece of equipment, or utensil under the regulations may 
request appeal service when the applicant or other persons who have a 
financial interest in a piece of equipment, portion of a piece of 
equipment, or utensil disagree with the determination as to compliance 
with the standard of the piece of equipment, portion of a piece of 
equipment, or utensil as documented in the applicable report.
    (b) A request for appeal service shall be filed with the Chief, 
directly or through the design review specialist who performed the 
original service. The request shall state the reasons for the 
disagreement with the original determination and may be accompanied by 
a copy of any previous certificate or report, or any other information 
which the applicant may have received regarding the piece of equipment, 
portion of a piece of equipment, or utensil at the time of the original 
service. Such request may be made orally (including by telephone) or in 
writing (including by facsimile transmission). If made orally, the 
Dairy Grading Branch employee receiving the request may require that it 
be confirmed in writing.


Sec. 54.1022  When request for appeal service may be withdrawn.

    A request for appeal service may be withdrawn by the applicant at 
any time before the appeal service has been performed, upon payment of 
any expenses already incurred under the regulations by the Branch in 
connection therewith.


Sec. 54.1023  Denial or withdrawal of appeal service.

    A request for appeal service may be rejected or such service may be 
otherwise denied to or withdrawn from any person in accordance with the 
procedure set forth in Sec. 54.1013(a), if it appears that the person 
or product involved is not eligible for appeal service under 
Sec. 54.1020, or that the identity of the piece of equipment, portion 
of a piece of equipment, or utensil has been lost; or for any of the 
causes set forth in Sec. 54.1013(a).


Sec. 54.1024  Who shall perform appeal service.

    Appeal service for equipment or utensils shall be performed by the 
Chief or a design review specialist designated by the Chief. No design 
review specialist may perform appeal service for any piece of 
equipment, portion of a piece of equipment or utensil for which the 
original design review specialist performed the initial evaluation 
service.


Sec. 54.1025  Appeal reports.

    After appeal service has been performed for any piece of equipment, 
portion of a piece of equipment or utensils, an official report shall 
be prepared, signed, and issued referring specifically to the original 
report and stating the determination of the re-evaluation of compliance 
of the piece of equipment, portion of a piece of equipment or utensil.


Sec. 54.1026  Superseded reports.

    The appeal report shall supersede the original report which, 
thereupon, shall become null and void for that portion of the report 
pertaining to the appeal service and shall not thereafter be deemed to 
show the compliance of the equipment or utensils described therein. 
However, the fees charged for the original service shall not be 
remitted to the applicant who filed the appeal.


Sec. 54.1027  Application of other regulations to appeal service.

    The regulations in Sec. 54.1001 through 54.1019 and Sec. 54.1028 
through 54.1034 shall apply to appeal service except insofar as they 
are inapplicable.


Sec. 54.1028  Fees and other charges for service.

    Fees and other charges equal as nearly as may be to the cost of the 
services rendered shall be assessed and collected from applicants in 
accordance with the provisions for Fees and Charges set forth in 7 CFR 
Part 58, Subpart A,--Regulations Governing the Inspection and Grading 
Services of Manufactured or Processed Dairy Products, Sec. 58.38, 
Sec. 58.39, Sec. 58.41, Sec. 58.42, and Sec. 58.43, as appropriate.


Sec. 54.1029  Payment of fees and other charges.

    Fees and other charges for service shall be paid upon receipt of 
billing for fees and other charges for service. The applicant shall 
remit by check, draft, or money order, made payable to the Agricultural 
Marketing Service, USDA, payment for the service in accordance with 
directions on the billing, and such fees and charges shall be paid in 
advance if required by the official design review specialist or other 
authorized official.


Sec. 54.1030  Identification.

    All official design review specialists and supervisors shall have 
their Agricultural Marketing Service identification cards in their 
possession at all times while they are performing any function under 
the regulations and shall identify themselves by such cards upon 
request.


Sec. 54.1031  Errors in service.

    When a design review specialist, supervisor, or other responsible 
employee of the Branch has evidence of inaccurate evaluation, or of 
incorrect certification or other incorrect determination or 
identification as to the compliance of a piece of equipment or utensil, 
such person shall report the matter to the Chief. The Chief will 
investigate the matter and, if deemed advisable, will report any 
material errors to the owner or the owner's agent. The Chief shall take 
appropriate action to correct errors found in the determination of 
compliance of equipment or utensils, and the Chief shall take adequate 
measures to prevent the recurrence of such errors.


Sec. 54.1032  Denial or withdrawal of service.

    (a) For misconduct--(1) Bases for denial or withdrawal. An 
application or a request for service may be rejected, or the benefits 
of the service may be otherwise denied to, or withdrawn from, any 
person who, or whose employee or agent in the scope of the person's 
employment or agency:
    (i) Has wilfully made any misrepresentation or has committed any 
other fraudulent or deceptive practice in connection with any 
application or request for service under the regulations;
    (ii) Has given or attempted to give, as a loan or for any other 
purpose, any money, favor, or other thing of value, to any employee of 
the Department authorized to perform any function under the 
regulations;
    (iii) Has interfered with or obstructed, or attempted to interfere 
with or to obstruct, any employee of the Department in the performance 
of duties under the regulations by intimidation, threats, assaults, 
abuse, or any other improper means;
    (iv) Has knowingly falsely made, issued, altered, forged, or 
counterfeited any official certificate, memorandum, mark, or other 
identification;
    (v) Has knowingly uttered, published, or used as true any such 
falsely made, issued, altered, forged, or counterfeited certificate, 
memorandum, mark or identification;
    (vi) Has knowingly obtained or retained possession of any such 
falsely made, issued, altered, forged, or counterfeited certificate, 
memorandum, mark or identification, or of any equipment or utensil 
bearing any such

[[Page 35869]]

falsely made, issued, altered, forged, or counterfeited mark or 
identification;
    (vii) Has applied the designation ``USDA Accepted Equipment'', 
``AMS Accepted Equipment'', ``USDA Approved Equipment'', ``AMS Approved 
Equipment'', ``Approved By USDA'', ``Approved By AMS'', ``Accepted By 
USDA'', ``Accepted By AMS'', ``USDA Approved'', ``USDA Accepted'', 
``AMS Approved'', ``AMS Accepted'', or any other variation of wording 
which states or implies official sanction by the United States 
Department of Agriculture by stamp, or brand directly on any equipment 
or utensil, or used as part of any promotional materials which has not 
been inspected and deemed in compliance with this subpart; or,
    (viii) Has in any manner not specified in this paragraph violated 
subsection 203(h) of the AMA: Provided, That paragraph (a)(1)(vi) of 
this section shall not be deemed to be violated if the person in 
possession of any item mentioned therein notifies the Deputy 
Administrator or Chief without such delay that such person has 
possession of such item and, in the case of an official identification, 
surrenders it to the Chief, and, in the case of any other item, 
surrenders it to the Deputy Administrator or Chief or destroys it or 
brings it into compliance with the regulations by obliterating or 
removing the violative features under supervision of the Deputy 
Administrator or Chief: And provided further, That paragraphs (a)(1) 
(ii) through (vii) of this section shall not be deemed to be violated 
by any act committed by any person prior to the making of an 
application of service under the regulations by the principal person. 
An application or a request for service may be rejected or the benefits 
of the service may be otherwise denied to, or withdrawn from, any 
person who operates an establishment for which such person has made 
application for service if, with the knowledge of such operator, any 
other person conducting any operations in such establishment has 
committed any of the offenses specified in paragraphs (a)(1) (i) 
through (vii) of this section after such application was made. 
Moreover, an application or a request for service made in the name of a 
person otherwise eligible for service under the regulations may be 
rejected, or the benefits of the service may be otherwise denied to, or 
withdrawn from, such a person.
    (A) In case the service is or would be performed at an 
establishment operated:
    (1) By a corporation, partnership, or other person from whom the 
benefits of the service are currently being withheld under this 
paragraph, or
    (2) By a corporation, partnership, or other person having an 
officer, director, partner, or substantial investor from whom the 
benefits of the service are currently being withheld and who has any 
authority with respect to the establishment where service is or would 
be performed; or
    (B) In case the service is or would be performed with respect to 
any product in which any corporation, partnership, or other person 
within paragraph (a)(1)(viii)(A)(1) of this section has a contract or 
other financial interest.
    (2) Procedure. All cases arising under this paragraph shall be 
conducted in accordance with the Rules of Practice Governing Formal 
Adjudicatory Proceedings Instituted by the Secretary Under Various 
Statutes set forth in 7 CFR Secs. 1.130 through 1.151 and the 
Supplemental Rules of Practice in part 50, 7 CFR Sec. 50.1 et seq.
    (b) Filing of records. The final orders in formal proceedings under 
paragraph (a) of this section to deny or withdraw the service under the 
regulations (except orders required for good cause to be held 
confidential and not cited as precedents) and other records in such 
proceedings (except those required for good cause to be held 
confidential) shall be filed with the Hearing Clerk and shall be 
available for inspection by persons having a proper interest therein.


Sec. 54.1033  Confidential treatment.

    Every design review specialist providing service under these 
regulations shall keep confidential all information secured and not 
disclose such information to any person except an authorized 
representative of the Department.


Sec. 54.1034  OMB control numbers assigned pursuant to the Paperwork 
Reduction Act.

    The following control number has been assigned to the information 
collection requirements in 7 CFR Part 54, Subpart C, by the Office of 
Management and Budget pursuant to the Paperwork Reduction Act of 1995 
(44 U.S.C. Chapter 35).

------------------------------------------------------------------------
                                                           Current  OMB
     7 CFR section where requirements are described         control No.
------------------------------------------------------------------------
54.1008(a)..............................................       0581-0126
54.1017.................................................       0581-0126
54.1018(e)..............................................       0581-0126
54.1019.................................................       0581-0126
54.1020.................................................       0581-0126
54.1021.................................................       0581-0126
------------------------------------------------------------------------


    Dated: June 1, 2000.
Barry L. Carpenter,
Deputy Administrator, Livestock and Seed Program.
[FR Doc. 00-14113 Filed 6-5-00; 8:45 am]
BILLING CODE 3410-02-P