[Federal Register Volume 68, Number 50 (Friday, March 14, 2003)]
[Proposed Rules]
[Pages 12310-12315]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-6164]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1205

[Doc. No. CN-03-002]


Cotton Board Rules and Regulations: Adjusting Supplemental 
Assessment on Imports, (2003 Amendments)

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: The Agricultural Marketing Service (AMS) is proposing to amend 
the Cotton Board Rules and Regulations by lowering the value assigned 
to imported cotton for the purpose of calculating supplemental 
assessments collected for use by the Cotton Research and Promotion 
Program. An adjustment is required on an annual basis to ensure that 
the assessments collected on imported cotton and the cotton content of 
imported products remain similar to those paid on domestically produced 
cotton.

DATES: Comments must be received on or before April 14, 2003.

ADDRESSES: Interested persons are invited to submit written comments

[[Page 12311]]

concerning this proposed rule to Whitney Rick, Chief, Research and 
Promotion Staff, Cotton Program, Agricultural Marketing Service, USDA, 
STOP 0224, Washington, DC 20250-0224. Comments should be submitted in 
triplicate. Comments may also be submitted electronically to: 
[email protected]. All comments should reference the docket 
number and the date and page number of this issue of the Federal 
Register. All comments received will be made available for public 
inspection at Cotton Program, AMS, USDA, Room 2641-S, 1400 Independence 
Ave., SW., Washington, DC 20250 during regular business hours. A copy 
of this notice may be found at: www.ams.usda.gov/cotton/rulemaking.htm.

FOR FURTHER INFORMATION CONTACT: Whitney Rick, Chief, Research and 
Promotion Staff, Cotton Program, AMS, USDA, STOP 0224, 1400 
Independence Ave., SW., Washington, DC 20250-0224, telephone (202) 720-
2259, facsimile (202) 690-1718, or e-mail at [email protected].

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    The Office of Management and Budget has waived the review process 
required by Executive Order 12866 for this action.

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. It is not intended to have retroactive effect. 
This proposed rule would not preempt any state or local laws, 
regulations, or policies, unless they present an irreconcilable 
conflict with this rule.
    The Cotton Research and Promotion Act provides that administrative 
proceedings must be exhausted before parties may file suit in court. 
Under section 12 of the Act, any person subject to an order may file 
with the Secretary a petition stating that the order, any provision of 
the plan, or any obligation imposed in connection with the order is not 
in accordance with law and requesting a modification of the order or to 
be exempted therefrom. Such person is afforded the opportunity for a 
hearing on the petition. After the hearing, the Secretary would rule on 
the petition. The Act provides that the District Court of the United 
States in any district in which the person is an inhabitant, or has his 
principal place of business, has jurisdiction to review the Secretary's 
ruling, provided a complaint is filed within 20 days from the date of 
the entry of ruling.

Regulatory Flexibility Act

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601 et seq.) AMS has considered the economic impact 
of this action on small entities and has determined that its 
implementation will not have a significant economic impact on a 
substantial number of small businesses.
    There are an estimated 10,000 importers who are presently subject 
to rules and regulations issued pursuant to the Cotton Research and 
Promotion Order. This proposed rule would affect importers of cotton 
and cotton-containing products. The majority of these importers are 
small businesses under the criteria established by the Small Business 
Administration. This proposed rule would lower the assessments paid by 
the importers under the Cotton Research and Promotion Order. Even 
though the assessment would be lowered, the decrease is small and will 
not significantly affect small businesses. The current assessment on 
imported cotton is $0.00862 per kilogram of imported cotton. The 
proposed assessment is $0.008267, a decrease of $0.000353 or a 4.1 
percent decrease. From January through December 2002 approximately $24 
million was collected. Should the volume of cotton products imported 
into the U.S. remain at the same level in 2003, one could expect the 
decreased assessment to generate approximately $23 million or a 4.1 
percent decrease from 2002.

Paperwork Reduction

    In compliance with Office of Management and Budget (OMB) 
regulations (5 CFR part 1320) which implement the Paperwork Reduction 
Act (PRA) (44 U.S.C. 3501 et seq.) the information collection 
requirements contained in the regulation to be amended have been 
previously approved by OMB and were assigned control number 0581-0093.

Background

    The Cotton Research and Promotion Act Amendments of 1990 enacted by 
Congress under Subtitle G of Title XIX of the Food, Agriculture, 
Conservation and Trade Act of 1990 on November 28, 1990, contained two 
provisions that authorized changes in the funding procedures for the 
Cotton Research and Promotion Program.
    These provisions are: (1) The assessment of imported cotton and 
cotton products; and (2) termination of the right of cotton producers 
to demand a refund of assessments.
    An amended Cotton Research and Promotion Order was approved by 
producers and importers voting in a referendum held July 17-26, 1991, 
and the amended Order was published in the Federal Register on December 
10, 1991, (56 FR 64470). A proposed rule implementing the amended Order 
was published in the Federal Register on December 17, 1991, (56 FR 
65450). Implementing rules were published on July 1 and 2, 1992, (57 FR 
29181) and (57 FR 29431), respectively.
    This proposed rule would decrease the value assigned to imported 
cotton in the Cotton Board Rules and Regulations (7 CFR 
1205.510(b)(2)). This value is used to calculate supplemental 
assessments on imported cotton and the cotton content of imported 
products. Supplemental assessments are the second part of a two-part 
assessment. The first part of the assessment is levied on the weight of 
cotton produced or imported at a rate of $1 per bale of cotton which is 
equivalent to 500 pounds or $1 per 226.8 kilograms of cotton.
    Supplemental assessments are levied at a rate of five-tenths of one 
percent of the value of domestically produced cotton, imported cotton, 
and the cotton content of imported products. The agency has adopted the 
practice of assigning the calendar year weighted average price received 
by U.S. farmers for Upland cotton to represent the value of imported 
cotton. This is done so that the assessment on domestically produced 
cotton and the assessment on imported cotton and the cotton content of 
imported products remain similar. The source for the average price 
statistic is ``Agricultural Prices'', a publication of the National 
Agricultural Statistics Service (NASS) of the Department of 
Agriculture. Use of the weighted average price figure in the 
calculation of supplemental assessments on imported cotton and the 
cotton content of imported products yields an assessment that 
approximates assessments paid on domestically produced cotton in the 
prior calendar year.
    The current value of imported cotton as published in the Federal 
Register (67 FR 36793) on May 28, 2002, for the purpose of calculating 
supplemental assessments on imported cotton is $.8422 per kilogram. 
This number was calculated using the annual weighted average price 
received by farmers for Upland cotton during the calendar year 2001 
which was $0.382 per pound and multiplying by the conversion factor 
2.2046. Using the Average Weighted Price received by U.S. farmers for 
Upland cotton for the calendar year 2002, which is $0.35 per pound, the 
new value of imported cotton is $0.7716 per kilogram. The proposed 
value is

[[Page 12312]]

$.0706 per kilogram less than the previous value.
    An example of the complete assessment formula and how the various 
figures are obtained is as follows:
    One bale is equal to 500 pounds.
    One kilogram equals 2.2046 pounds.
    One pound equals 0.453597 kilograms.

One Dollar Per Bale Assessment Converted to Kilograms

    A 500 pound bale equals 226.8 kg. (500 x .453597).
    $1 per bale assessment equals $0.002000 per pound (1/500) or 
$0.004409 per kg. (1/226.8).

Supplemental Assessment of 5/10 of One Percent of the Value of the 
Cotton Converted to Kilograms.

    The 2002 calendar year weighted average price received by producers 
for Upland cotton is $0.35 per pound or $0.7716 per kg. (0.35 x 
2.2046).
    Five tenths of one percent of the average price in kg. equals 
$0.003858 per kg. (0.7716 x .005).

Total Assessment

    The total assessment per kilogram of raw cotton is obtained by 
adding the $1 per bale equivalent assessment of $0.004409 per kg. and 
the supplemental assessment $0.003858 per kg. which equals $0.008267 
per kg.
    The current assessment on imported cotton is $0.008620 per kilogram 
of imported cotton. The proposed assessment is $0.008267, a decrease of 
$0.000353 per kilogram. This decrease reflects the decrease in the 
Average Weighted Price of Upland Cotton received by U.S. Farmers during 
the period January through December 2002.
    Since the value of cotton is the basis of the supplemental 
assessment calculation and the figures shown in the right hand column 
of the Import Assessment Table 1205.510(b)(3) are a result of such a 
calculation, the figures in this table have been revised. These figures 
indicate the total assessment per kilogram due for each Harmonized 
Tariff Schedule (HTS) number subject to assessment.
    A thirty day comment period is provided to comment on the changes 
to the Cotton Board Rules and Regulations proposed herein. This period 
is deemed appropriate because this proposal would lower the assessments 
paid by importers under the Cotton Research and Promotion Order. 
Accordingly, the change proposed in this rule, if adopted, should be 
implemented as soon as possible.

List of Subjects in 7 CFR Part 1205

    Advertising, Agricultural research, Cotton, Marketing agreements, 
Reporting and recordkeeping requirements.

    For the reasons set forth in the preamble 7 CFR part 1205 is 
proposed to be amended as follows:

PART 1205--COTTON RESEARCH AND PROMOTION

    1. The authority citation for part 1205 continues to read as 
follows:

    Authority: 7 U.S.C. 2101-2118.

    2. In Sec.  1205.510, paragraph (b)(2) and the table in paragraph 
(b)(3)(ii) are revised to read as follows:


Sec.  1205.510  Levy of assessments.

* * * * *
    (b) * * *
    (2) The 12-month average of monthly weighted average prices 
received by U.S. farmers will be calculated annually. Such weighted 
average will be used as the value of imported cotton for the purpose of 
levying the supplemental assessment on imported cotton and will be 
expressed in kilograms. The value of imported cotton for the purpose of 
levying this supplemental assessment is $0.8267 per kilogram.
    (3) * * *
    (ii) * * *

                         Import Assessment Table
                           [Raw Cotton Fiber]
------------------------------------------------------------------------
                   HTS No.                     Conv. fact.    Cents/kg.
------------------------------------------------------------------------
5201000500..................................        0             0.8267
5201001200..................................        0             0.8267
5201001400..................................        0             0.8267
5201001800..................................        0             0.8267
5201002200..................................        0             0.8267
5201002400..................................        0             0.8267
5201002800..................................        0             0.8267
5201003400..................................        0             0.8267
5201003800..................................        0             0.8267
5204110000..................................        1.1111        0.9185
5204200000..................................        1.1111        0.9185
5205111000..................................        1.1111        0.9185
5205112000..................................        1.1111        0.9185
5205121000..................................        1.1111        0.9185
5205122000..................................        1.1111        0.9185
5205131000..................................        1.1111        0.9185
5205132000..................................        1.1111        0.9185
5205141000..................................        1.1111        0.9185
5205210020..................................        1.1111        0.9185
5205210090..................................        1.1111        0.9185
5205220020..................................        1.1111        0.9185
5205220090..................................        1.1111        0.9185
5205230020..................................        1.1111        0.9185
5205230090..................................        1.1111        0.9185
5205240020..................................        1.1111        0.9185
5205240090..................................        1.1111        0.9185
5205310000..................................        1.1111        0.9185
5205320000..................................        1.1111        0.9185
5205330000..................................        1.1111        0.9185
5205340000..................................        1.1111        0.9185
5205410020..................................        1.1111        0.9185
5205410090..................................        1.1111        0.9185
5205420020..................................        1.1111        0.9185
5205420090..................................        1.1111        0.9185
5205440020..................................        1.1111        0.9185
5205440090..................................        1.1111        0.9185
5206120000..................................        0.5556        0.4593
5206130000..................................        0.5556        0.4593
5206140000..................................        0.5556        0.4593
5206220000..................................        0.5556        0.4593
5206230000..................................        0.5556        0.4593
5206240000..................................        0.5556        0.4593
5206310000..................................        0.5556        0.4593
5207100000..................................        1.1111        0.9185
5207900000..................................        0.5556        0.4593
5208112020..................................        1.1455        0.9470
5208112040..................................        1.1455        0.9470
5208112090..................................        1.1455        0.9470
5208114020..................................        1.1455        0.9470
5208114060..................................        1.1455        0.9470
5208114090..................................        1.1455        0.9470
5208118090..................................        1.1455        0.9470
5208124020..................................        1.1455        0.9470
5208124040..................................        1.1455        0.9470
5208124090..................................        1.1455        0.9470
5208126020..................................        1.1455        0.9470
5208126040..................................        1.1455        0.9470
5208126060..................................        1.1455        0.9470
5208126090..................................        1.1455        0.9470
5208128020..................................        1.1455        0.9470
5208128090..................................        1.1455        0.9470
5208130000..................................        1.1455        0.9470
5208192020..................................        1.1455        0.9470
5208192090..................................        1.1455        0.9470
5208194020..................................        1.1455        0.9470
5208194090..................................        1.1455        0.9470
5208196020..................................        1.1455        0.9470
5208196090..................................        1.1455        0.9470
5208224040..................................        1.1455        0.9470
5208224090..................................        1.1455        0.9470
5208226020..................................        1.1455        0.9470
5208226060..................................        1.1455        0.9470
5208228020..................................        1.1455        0.9470
5208230000..................................        1.1455        0.9470
5208292020..................................        1.1455        0.9470
5208292090..................................        1.1455        0.9470
5208294090..................................        1.1455        0.9470
5208296090..................................        1.1455        0.9470
5208298020..................................        1.1455        0.9470
5208312000..................................        1.1455        0.9470
5208321000..................................        1.1455        0.9470
5208323020..................................        1.1455        0.9470
5208323040..................................        1.1455        0.9470
5208323090..................................        1.1455        0.9470
5208324020..................................        1.1455        0.9470
5208324040..................................        1.1455        0.9470
5208325020..................................        1.1455        0.9470
5208330000..................................        1.1455        0.9470
5208392020..................................        1.1455        0.9470
5208392090..................................        1.1455        0.9470
5208394090..................................        1.1455        0.9470
5208396090..................................        1.1455        0.9470
5208398020..................................        1.1455        0.9470
5208412000..................................        1.1455        0.9470
5208416000..................................        1.1455        0.9470
5208418000..................................        1.1455        0.9470
5208421000..................................        1.1455        0.9470
5208423000..................................        1.1455        0.9470
5208424000..................................        1.1455        0.9470

[[Page 12313]]

 
5208425000..................................        1.1455        0.9470
5208430000..................................        1.1455        0.9470
5208492000..................................        1.1455        0.9470
5208494020..................................        1.1455        0.9470
5208494090..................................        1.1455        0.9470
5208496010..................................        1.1455        0.9470
5208496090..................................        1.1455        0.9470
5208498090..................................        1.1455        0.9470
5208512000..................................        1.1455        0.9470
5208516060..................................        1.1455        0.9470
5208518090..................................        1.1455        0.9470
5208523020..................................        1.1455        0.9470
5208523045..................................        1.1455        0.9470
5208523090..................................        1.1455        0.9470
5208524020..................................        1.1455        0.9470
5208524045..................................        1.1455        0.9470
5208524065..................................        1.1455        0.9470
5208525020..................................        1.1455        0.9470
5208530000..................................        1.1455        0.9470
5208592025..................................        1.1455        0.9470
5208592095..................................        1.1455        0.9470
5208594090..................................        1.1455        0.9470
5208596090..................................        1.1455        0.9470
5209110020..................................        1.1455        0.9470
5209110035..................................        1.1455        0.9470
5209110090..................................        1.1455        0.9470
5209120020..................................        1.1455        0.9470
5209120040..................................        1.1455        0.9470
5209190020..................................        1.1455        0.9470
5209190040..................................        1.1455        0.9470
5209190060..................................        1.1455        0.9470
5209190090..................................        1.1455        0.9470
5209210090..................................        1.1455        0.9470
5209220020..................................        1.1455        0.9470
5209220040..................................        1.1455        0.9470
5209290040..................................        1.1455        0.9470
5209290090..................................        1.1455        0.9470
5209313000..................................        1.1455        0.9470
5209316020..................................        1.1455        0.9470
5209316035..................................        1.1455        0.9470
5209316050..................................        1.1455        0.9470
5209316090..................................        1.1455        0.9470
5209320020..................................        1.1455        0.9470
5209320040..................................        1.1455        0.9470
5209390020..................................        1.1455        0.9470
5209390040..................................        1.1455        0.9470
5209390060..................................        1.1455        0.9470
5209390080..................................        1.1455        0.9470
5209390090..................................        1.1455        0.9470
5209413000..................................        1.1455        0.9470
5209416020..................................        1.1455        0.9470
5209416040..................................        1.1455        0.9470
5209420020..................................        1.0309        0.8522
5209420040..................................        1.0309        0.8522
5209430030..................................        1.1455        0.9470
5209430050..................................        1.1455        0.9470
5209490020..................................        1.1455        0.9470
5209490090..................................        1.1455        0.9470
5209516035..................................        1.1455        0.9470
5209516050..................................        1.1455        0.9470
5209520020..................................        1.1455        0.9470
5209590025..................................        1.1455        0.9470
5209590040..................................        1.1455        0.9470
5209590090..................................        1.1455        0.9470
5210114020..................................        0.6873        0.5682
5210114040..................................        0.6873        0.5682
5210116020..................................        0.6873        0.5682
5210116040..................................        0.6873        0.5682
5210116060..................................        0.6873        0.5682
5210118020..................................        0.6873        0.5682
5210120000..................................        0.6873        0.5682
5210192090..................................        0.6873        0.5682
5210214040..................................        0.6873        0.5682
5210216020..................................        0.6873        0.5682
5210216060..................................        0.6873        0.5682
5210218020..................................        0.6873        0.5682
5210314020..................................        0.6873        0.5682
5210314040..................................        0.6873        0.5682
5210316020..................................        0.6873        0.5682
5210318020..................................        0.6873        0.5682
5210414000..................................        0.6873        0.5682
5210416000..................................        0.6873        0.5682
5210418000..................................        0.6873        0.5682
5210498090..................................        0.6873        0.5682
5210514040..................................        0.6873        0.5682
5210516020..................................        0.6873        0.5682
5210516040..................................        0.6873        0.5682
5210516060..................................        0.6873        0.5682
5211110090..................................        0.6873        0.5682
5211120020..................................        0.6873        0.5682
5211190020..................................        0.6873        0.5682
5211190060..................................        0.6873        0.5682
5211210025..................................        0.6873        0.5682
5211210035..................................        0.4165        0.3443
5211210050..................................        0.6873        0.5682
5211290090..................................        0.6873        0.5682
5211320020..................................        0.6873        0.5682
5211390040..................................        0.6873        0.5682
5211390060..................................        0.6873        0.5682
5211490020..................................        0.6873        0.5682
5211490090..................................        0.6873        0.5682
5211590025..................................        0.6873        0.5682
5212146090..................................        0.9164        0.7576
5212156020..................................        0.9164        0.7576
5212216090..................................        0.9164        0.7576
5509530030..................................        0.5556        0.4593
5509530060..................................        0.5556        0.4593
5513110020..................................        0.4009        0.3314
5513110040..................................        0.4009        0.3314
5513110060..................................        0.4009        0.3314
5513110090..................................        0.4009        0.3314
5513120000..................................        0.4009        0.3314
5513130020..................................        0.4009        0.3314
5513210020..................................        0.4009        0.3314
5513310000..................................        0.4009        0.3314
5514120020..................................        0.4009        0.3314
5516420060..................................        0.4009        0.3314
5516910060..................................        0.4009        0.3314
5516930090..................................        0.4009        0.3314
5601210010..................................        1.1455        0.9470
5601210090..................................        1.1455        0.9470
5601300000..................................        1.1455        0.9470
5602109090..................................        0.5727        0.4735
5602290000..................................        1.1455        0.9470
5602906000..................................        0.526         0.4348
5604900000..................................        0.5556        0.4593
5607909000..................................        0.8889        0.7349
5608901000..................................        1.1111        0.9185
5608902300..................................        1.1111        0.9185
5609001000..................................        1.1111        0.9185
5609004000..................................        0.5556        0.4593
5701104000..................................        0.0556        0.0460
5701109000..................................        0.1111        0.0918
5701901010..................................        1.0444        0.8634
5702109020..................................        1.1           0.9094
5702312000..................................        0.0778        0.0643
5702411000..................................        0.0722        0.0597
5702412000..................................        0.0778        0.0643
5702421000..................................        0.0778        0.0643
5702913000..................................        0.0889        0.0735
5702991010..................................        1.1111        0.9185
5702991090..................................        1.1111        0.9185
5703900000..................................        0.4489        0.3711
5801210000..................................        1.1455        0.9470
5801230000..................................        1.1455        0.9470
5801250010..................................        1.1455        0.9470
5801250020..................................        1.1455        0.9470
5801260020..................................        1.1455        0.9470
5802190000..................................        1.1455        0.9470
5802300030..................................        0.5727        0.4735
5804291000..................................        1.1455        0.9470
5806200010..................................        0.3534        0.2922
5806200090..................................        0.3534        0.2922
5806310000..................................        1.1455        0.9470
5806400000..................................        0.4296        0.3552
5808107000..................................        0.5727        0.4735
5808900010..................................        0.5727        0.4735
5811002000..................................        1.1455        0.9470
6001106000..................................        1.1455        0.9470
6001210000..................................        0.8591        0.7102
6001220000..................................        0.2864        0.2368
6001910010..................................        0.8591        0.7102
6001910020..................................        0.8591        0.7102
6001920020..................................        0.2864        0.2368
6001920030..................................        0.2864        0.2368
6001920040..................................        0.2864        0.2368
6003203000..................................        0.8681        0.7177
6003306000..................................        0.2894        0.2392
6003406000..................................        0.2894        0.2392
6005210000..................................        0.8681        0.7177
6005220000..................................        0.8681        0.7177
6005230000..................................        0.8681        0.7177
6005240000..................................        0.8681        0.7177
6005310010..................................        0.2894        0.2392
6005320010..................................        0.2894        0.2392
6005330010..................................        0.2894        0.2392
6005340010..................................        0.2894        0.2392
6005410010..................................        0.2894        0.2392
6005420010..................................        0.2894        0.2392
6005430010..................................        0.2894        0.2392
6005440010..................................        0.2894        0.2392
6005310080..................................        0.2894        0.2392
6005320080..................................        0.2894        0.2392
6005330080..................................        0.2894        0.2392
6005340080..................................        0.2894        0.2392
6005410080..................................        0.2894        0.2392
6005420080..................................        0.2894        0.2392
6005430080..................................        0.2894        0.2392
6005440080..................................        0.2894        0.2392
6006211000..................................        1.1574        0.9568
6006221000..................................        1.1574        0.9568
6006231000..................................        1.1574        0.9568
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6505901540..................................        0.181         0.1496
6505902060..................................        0.9935        0.8213
6505902545..................................        0.5844        0.4831
------------------------------------------------------------------------

* * * * *

    Dated: March 11, 2003.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 03-6164 Filed 3-13-03; 8:45 am]
BILLING CODE 3410-02-P