[Federal Register Volume 71, Number 76 (Thursday, April 20, 2006)]
[Proposed Rules]
[Pages 20350-20351]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-5940]


 ========================================================================
 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. 71, No. 76 / Thursday, April 20, 2006 / 
Proposed Rules  

[[Page 20350]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 28

[Doc.  CN-06-001]
RIN 0581-AC58


User Fees for 2006 Crop Cotton Classification Services To Growers

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: The Agricultural Marketing Service (AMS) is proposing to 
maintain user fees for cotton producers for 2006 crop cotton 
classification services under the Cotton Statistics and Estimates Act 
at the same level as in 2005. This is in accordance with the formula 
provided in the Uniform Cotton Classing Fees Act of 1987. The 2005 user 
fee for this classification service was $1.85 per bale. This proposal 
would maintain the fee for the 2006 crop at $1.85 per bale. The 
proposed fee and the existing reserve are sufficient to cover the costs 
of providing classification services, including costs for 
administration and supervision.

DATES: Comments must be received on or before May 5, 2006.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule to Darryl Earnest, Deputy Administrator, 
Cotton Program, AMS, USDA, STOP 0224, 1400 Independence Avenue, SW., 
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 the page of this issue of the Federal Register. 
All comments received will be available for public inspection during 
regular business hours at the above office in Rm. 2641--South Building, 
1400 Independence Avenue, SW., Washington, DC. A copy of this notice 
may be found at: http://www.ams.usda.gov/cotton/rulemaking.htm.

FOR FURTHER INFORMATION CONTACT: Darryl Earnest, Deputy Administrator, 
Cotton Program, AMS, USDA, Room 2641-S, Stop 0224, 1400 Independence 
Avenue, SW., Washington, DC 20250-0224. Telephone (202) 720-2145, 
facsimile (202) 690-1718, or e-mail [email protected].

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This proposed rule has been determined to be not significant for 
purposes of Executive Order 12866; and, therefore has not been reviewed 
by the Office of Management and Budget (OMB).

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 rule would not preempt any state or local laws, regulations, or 
policies unless they present an irreconcilable conflict with this rule. 
There are no administrative procedures that must be exhausted prior to 
any judicial challenge to the provisions of this rule.

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.
    The purpose of the RFA is to fit regulatory actions to the scale of 
businesses subject to such actions so that small businesses will not be 
disproportionately burdened. There are an estimated 35,000 cotton 
growers in the U.S. who voluntarily use the AMS cotton classing 
services annually, and the majority of these cotton growers are small 
businesses under the criteria established by the Small Business 
Administration (13 CFR 121.201). Continuing the user fee at the 2005 
crop level as stated will not significantly affect small businesses as 
defined in the RFA because:
    (1) The fee represents a very small portion of the cost-per-unit 
currently borne by those entities utilizing the services. (The 2005 
user fee for classification services was $1.85 per bale; the fee for 
the 2006 crop would be maintained at $1.85 per bale; the 2006 crop is 
estimated at 21,000,000 bales).
    (2) The fee for services will not affect competition in the 
marketplace; and
    (3) The use of classification services is voluntary. For the 2005 
crop, 23,703,000 bales were produced; and, almost all of these bales 
were voluntarily submitted by growers for the classification service.
    (4) Based on the average price paid to growers for cotton from the 
2004 crop of 41.6 cents per pound, 500 pound bales of cotton are worth 
an average of $208 each. The proposed user fee for classification 
services, $1.85 per bale, is less than one percent of the value of an 
average bale of cotton.

Paperwork Reduction Act

    In compliance with OMB regulations (5 CFR part 1320), which 
implemented the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq.), 
the information collection requirements contained in the provisions to 
be amended by this proposed rule have been previously approved by OMB 
and were assigned OMB control number 0581-AC43.
    It is anticipated that the proposed changes, if adopted, would be 
made effective July 1, 2006, as provided by the Cotton Statistics and 
Estimates Act.

Fees for Classification Under the Cotton Statistics and Estimates Act 
of 1927

    The user fee charged to cotton producers for High Volume Instrument 
(HVI) classification services under the Cotton Statistics and Estimates 
Act (7 U.S.C. 473a) was $1.85 per bale during the 2005 harvest season 
as determined by using the formula provided in the Uniform Cotton 
Classing Fees Act of 1987, as amended by Public Law 102-237. The fees 
cover salaries, costs of equipment and supplies, and other overhead 
costs, including costs for administration, and supervision.
    This proposed rule establishes the user fee charged to producers 
for HVI classification at $1.85 per bale during the 2006 harvest 
season.
    Public Law 102-237 amended the formula in the Uniform Cotton 
Classing Fees Act of 1987 for establishing the producer's 
classification fee so that the producer's fee is based on the 
prevailing method of classification requested by producers during the 
previous year. HVI

[[Page 20351]]

classing was the prevailing method of cotton classification requested 
by producers in 2005. Therefore, the 2006 producer's user fee for 
classification service is based on the 2005 base fee for HVI 
classification.
    The fee was calculated by applying the formula specified in the 
Uniform Cotton Classing Fees Act of 1987, as amended by Public Law 102-
237. The 2005 base fee for HVI classification exclusive of adjustments, 
as provided by the Act, was $2.37 per bale. An increase of 3.29 
percent, or 8 cents per bale, due to the implicit price deflator of the 
gross domestic product added to the $2.37 would result in a 2006 base 
fee of $2.45 per bale. The formula in the Act provides for the use of 
the percentage change in the implicit price deflator of the gross 
national product (as indexed for the most recent 12-month period for 
which statistics are available). However, gross national product has 
been replaced by gross domestic product by the Department of Commerce 
as a more appropriate measure for the short-term monitoring and 
analysis of the U.S. economy.
    The number of bales to be classed by the United States Department 
of Agriculture from the 2006 crop is estimated at 20,268,150 bales. The 
2006 base fee was decreased 15 percent based on the estimated number of 
bales to be classed (1 percent for every 100,000 bales or portion 
thereof above the base of 12,500,000, limited to a maximum decreased 
adjustment of 15 percent). This percentage factor amounts to a 37 cents 
per bale reduction and was subtracted from the 2006 base fee of $2.45 
per bale, resulting in a fee of $2.08 per bale.
    However, with a fee of $2.08 per bale, the projected operating 
reserve would be 35.74 percent. The Act specifies that the Secretary 
shall not establish a fee which, when combined with other sources of 
revenue, will result in a projected operating reserve of more than 25 
percent. Accordingly, the fee of $2.08 must be reduced by 23 cents per 
bale, to $1.85 per bale, to provide an ending accumulated operating 
reserve for the fiscal year of not more than 25 percent of the 
projected cost of operating the program. This would establish the 2006 
season fee at $1.85 per bale.
    Accordingly, section 28.909, paragraph (b) would reflect the 
continuation of the HVI classification fee at $1.85 per bale.
    As provided for in the Uniform Cotton Classing Fees Act of 1987, as 
amended, a 5 cent per bale discount would continue to be applied to 
voluntary centralized billing and collecting agents as specified in 
section 28.909 (c).
    Growers or their designated agents receiving classification data 
would continue to incur no additional fees if classification data is 
requested only once. The fee for each additional retrieval of 
classification data in section 28.910 would remain at 5 cents per bale. 
The fee in section 28.910(b) for an owner receiving classification data 
from the National database would remain at 5 cents per bale, and the 
minimum charge of $5.00 for services provided per monthly billing 
period would remain the same. The provisions of section 28.910(c) 
concerning the fee for new classification memoranda issued from the 
National database for the business convenience of an owner without 
reclassification of the cotton will remain the same at 15 cents per 
bale or a minimum of $5.00 per sheet.
    The fee for review classification in section 28.911 would be 
maintained at $1.85 per bale.
    The fee for returning samples after classification in section 
28.911 would remain at 40 cents per sample.
    A 15-day comment period is provided for public comments. This 
period is appropriate because it is anticipated that the proposed 
changes, if adopted, would be made effective July 1, 2006, as provided 
by the Cotton Statistics and Estimates Act.

List of Subjects in 7 CFR Part 28

    Administrative practice and procedure, Cotton, Cotton samples, 
Grades, Market news, Reporting and recordkeeping requirements, 
Standards, Staples, Testing, Warehouses.

    For the reasons set forth in the preamble, 7 CFR part 28 is 
proposed to be amended as follows:

PART 28--[AMENDED]

    1. The authority citation for 7 CFR part 28, subpart D, continues 
to read as follows:

    Authority: 7 U.S.C. 471-476.

    2. In Sec.  28.909, paragraph (b) is revised to read as follows:


Sec.  28.909  Costs.

* * * * *
    (b) The cost of High Volume Instrument (HVI) cotton classification 
service to producers is $1.85 per bale.
* * * * *
    3. In Sec.  28.911, the last sentence of paragraph (a) is revised 
to read as follows:


Sec.  28.911  Review classification.

    (a) * * * The fee for review classification is $1.85 per bale.
* * * * *

    Dated: April 14, 2006.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E6-5940 Filed 4-19-06; 8:45 am]
BILLING CODE 3410-02-P