[Federal Register Volume 71, Number 96 (Thursday, May 18, 2006)]
[Rules and Regulations]
[Pages 28759-28763]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-4662]



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 Rules and Regulations
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  Federal Register / Vol. 71, No. 96 / Thursday, May 18, 2006 / Rules 
and Regulations  

[[Page 28759]]



DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Part 272

RIN 0584-AC75


Food Stamp Program: Civil Rights Data Collection

AGENCY: Food and Nutrition Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This rule finalizes the proposed rule of the same name which 
was published November 27, 2002. It implements the revised collection 
and reporting of racial/ethnic data by State agencies on persons 
receiving benefits from the Food Stamp Program (FSP). The changes 
comply with new racial/ethnic data collection standards issued by the 
Office of Management and Budget (OMB) while also providing regulatory 
flexibility and reform for this area of the program regulations.

DATES: Effective date: This rule is effective June 19, 2006. 
Implementation date: State agencies may implement the provisions in 
this final rule anytime after June 19, 2006 but no later than April 1, 
2007.

FOR FURTHER INFORMATION CONTACT: Barbara Hallman, Chief, State 
Administration Branch, Food and Nutrition Service, 3101 Park Center 
Drive, Alexandria, Virginia 22302, (703) 305-2383. Her Internet address 
is: [email protected].

Executive Order 12866

    This final 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.

Executive Order 12372

    The FSP is listed in the Catalog of Federal Domestic Assistance 
under No. 10.551. For the reasons set forth in the final rule at 7 CFR 
Part 3015, Subpart V and related Notice (48 FR 29115, June 24, 1983), 
the FSP is excluded from the scope of Executive Order 12372 which 
requires intergovernmental consultation with State and local officials.

Regulatory Flexibility Act

    This rule has been reviewed with regard to the requirements of the 
Regulatory Flexibility Act of 1980 (5 U.S.C. 601-612). Roberto Salazar, 
Administrator for the Food and Nutrition Service, has certified that 
this rule will not have a significant impact on a substantial number of 
small entities. This rule may have minimal effect on some small 
entities.

Executive Order 12988

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is intended to have preemptive effect 
with respect to any State or local laws, regulations or policies which 
conflict with its provisions or which would otherwise impede its full 
implementation. This rule is not intended to have retroactive effect. 
Prior to any judicial challenge to the provisions of this rule or the 
application of its provisions, all applicable administrative procedures 
must be exhausted.

Public Law 104-4

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, FNS 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with ``Federal mandates'' that 
may result in expenditures to State, local, or tribal governments, in 
the aggregate, or to the private sector, of $100 million or more in any 
one year. When such a statement is needed for a rule, section 205 of 
the UMRA generally requires FNS to identify and consider a reasonable 
number of regulatory alternatives and adopt the least costly, more 
cost-effective or least burdensome alternative that achieves the 
objectives of the rule.
    This proposed rule contains no Federal mandates under the 
regulatory provisions of Title II of the UMRA for State, local and 
tribal governments or the private sector of $100 million or more in any 
one year. Therefore, this rule is not subject to the requirements of 
Sections 202 and 205 of the UMRA.

Executive Order 13132, Federalism

    Executive Order 13132 requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. 
Where such actions have federalism implications, agencies are directed 
to provide a statement for inclusion in the preamble to the regulations 
describing the agency's considerations in terms of the three categories 
called for under section (6)(b)(2)(B) of Executive Order 13132. FNS has 
considered the impact on State agencies. The effect on State agencies 
is moderate although it will mean a one-time change to collect and 
compile the new data in State agencies' automated systems. However, 
because these changes have been or are also being made in other Federal 
programs, the impact is not all that great for the Food Stamp Program. 
FNS is not aware of any case where the discretionary provisions of the 
rule would preempt State law.

(1) Prior Consultation With State Officials

    Prior to drafting this rule, we consulted with State and local 
agencies at various times. Because the FSP is a State-administered, 
Federally funded program, our regional offices have formal and informal 
discussions with State and local officials on an ongoing basis 
regarding program implementation and policy issues. This arrangement 
allows State and local agencies to provide comments that form the basis 
for many discretionary decisions in this and other Food Stamp rules. 
Further, we first requested comments on the proposed data collection 
for the revised standards in our November 30, 1999 Federal Register 
notice. State agency comments have helped us make the rule responsive 
to concerns presented by State agencies.

(2) Nature of Concerns and the Need To Issue This Rule

    State agencies generally were concerned that the classification by 
eligibility workers of an applicant's multiple race heritage via visual 
observation of people who chose not to self-identify may not always be 
accurate. They were also concerned

[[Page 28760]]

about the cost involved and time that will be allowed for State 
agencies to make system changes to collect and compile the data, to 
train workers, and to convert the current caseload. The standardization 
of the data collection addresses another major State concern i.e. the 
need to have the data collected in the same way across other means-
tested Federal programs. Specific comments and policy questions 
submitted by State agencies helped us identify issues that needed to be 
clarified in the final rule.

(3) Extent to Which We Meet Those Concerns

    FNS has considered the impact of the rule on State and local 
agencies. This rule makes changes that conform to the revised OMB 
standards for the collection and reporting of racial ethnic data. 
Although the rule implementing the revised data collection standards 
will require eligibility workers to collect both race and ethnicity on 
participating households, the information will standardize racial 
ethnic data collection by States for the Federal Government and will 
permit more accurate data collection on individuals who classify 
themselves as being of more than one race. FNS intends to allow State 
agencies to record one race per person when visual observation is used 
because the applicant chooses not to self-identify. While State 
agencies will have to change their application form and possibly their 
information system to collect, compile, and report data, and train 
workers, this is a one-time change. For existing cases, we are allowing 
State agencies to collect the data at the time of recertification 
through the normal re-application process. The approximately 50 percent 
Federal reimbursement by FNS helps defray approximately half the State 
agencies' costs to make the change for the FSP. The rule provides State 
agencies ample time to implement the revised data collection standards 
and convert the existing caseload to the revised data requirements. In 
the rule, we have addressed every concern submitted by State agencies 
regarding this provision. FNS is not aware of any case where the 
provisions of the rule would preempt State law.

Government Paperwork Elimination Act

    The Government Paperwork Elimination Act (GPEA) requires Federal 
Government agencies to provide electronic submission for information 
collection as an alternative to paper submission. FNS is committed to 
compliance with GPEA. The racial/ethnic information is collected by 
State and local agencies. In April 2004, FNS implemented electronic 
reporting for the FNS-101 for the FSP. The data may be submitted to FNS 
via data entered in the Food Programs Reporting System.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35; see 5 
CFR 1320) requires that the Office of Management and Budget (OMB) 
approve all collections of information by a Federal agency from the 
public before they can be implemented. Respondents are not required to 
respond to any collection of information unless it displays a current 
valid OMB number. This final rule contains information collection that 
have been approved by OMB under OMB 0584-0025.
    The rule addresses implementation of the revised OMB standards for 
the FSP only. Historically, the FSP, the Commodity Supplemental Food 
Program (CSFP), and the Food Distribution Program on Indian 
Reservations (FDPIR) have been approved under the same OMB approval 
package. FNS is publishing the revised regulation for the FSP only 
because the regulations governing the FSP contain provisions that must 
be amended to implement the revised standards, since they specifically 
identify the old racial/ethnic classifications. The CSFP and FDPIR do 
not require similar regulatory changes.
    Under the proposed rule, we estimated that 53 State FSP agencies 
would submit a Form FNS-101 once a year at a burden of 2 hours per 
respondent for a total of 106 hours for the FSP. The final rule 
requires States to report the Form FNS-101 by project area, as they do 
now. We estimate that 2,616 project areas will report the FNS-101 for 
the FSP. Accordingly, we estimate a total burden for the FSP under 
0584-0025 will decline to 5,232 hours, a decrease of 654 hours. The 
decline is due to a re-estimate of the time it takes to complete the 
revised FNS-101.

Burden Estimate

    Respondents: Local agencies that administer the CSFP, FDPIR, and 
FSP.
    Number of Respondents: 2,873 (147 for CSFP, 110 for FSDPIR, and 
2,616 for FSP).
    Estimated Number of Responses per Respondent:
    Form FNS-191: 147 local CSFP agencies once a year.
    Form FNS-101: 110 local FDPIR agencies and 2,616 FSP local agencies 
once a year.
    Estimate of Burden:
    Form FNS-191: The local CSFP agencies submit Form FNS-191 at an 
estimate of 1.92 hours per respondent, or 282.24 hours. There is an 
additional recordkeeping burden of .08 hours per respondent, or 11.76 
hours. Total burden is 294 hours.
    Form FNS-101: The 2,726 local FDPIR and FSP agencies submit Form 
FNS-101 at an estimate of 1.92 hours per respondent, or 5,233.92 hours. 
There is an additional burden of .08 hours per respondent for 
recordkeeping, or 218.08 hours. Total burden is 5,452 hours.
    Estimated Total Annual Burden on Respondents: The revised annual 
reporting and recordkeeping burden for OMB No. 0584-0025 is estimated 
to be 5,746 hours, a reduction of 675.5 hours. The burden reduction is 
due to a re-estimate of the time it takes to complete the new FNS-101 
form.

Civil Rights Impact Analysis

    FNS has reviewed this final rule in accordance with the Department 
Regulation 4300-4, ``Civil Rights Impact Analysis,'' to identify and 
address any major civil rights impacts the rule might have on 
minorities, women, and persons with disabilities. After a careful 
review of the rule's intent and provisions, and the characteristics of 
food stamp households and individual participants, FNS has determined 
that there is no adverse impact on any group. While this rule does 
provide for the collection of racial ethnic data on FSP applicants and 
recipients, it does not change any eligibility criteria.
    FNS specifically prohibits the State and local government agencies 
that administer the Program from engaging in actions that discriminate 
based on race, color, national origin, gender, age, religious creed, 
disability, or political beliefs (FSP nondiscrimination policy can be 
found at 7 CFR 272.6(a)). Where State agencies have options, and they 
choose to implement a certain provision, they must implement it in such 
a way that it complies with the regulations at 7 CFR 272.6.

Background

    Title VI of the Civil Rights Act of 1964 prohibits discrimination 
on the basis of race, color, and national origin in programs receiving 
federal financial assistance. The Department of Justice (DOJ) 
regulations, at 28 CFR 42.406(a), require all Federal agencies to 
provide for the collection of racial and ethnic information from 
applicants for and beneficiaries of Federal assistance sufficient to 
permit effective enforcement of Title VI. On October 30, 1997, OMB 
issued revised standards for the classification of Federal data on race

[[Page 28761]]

and ethnicity in a notice in the Federal Register (62 FR 58782). All 
Federal agencies are required to comply with the revised OMB standards. 
The OMB standards revise the racial and ethnic categories and require 
that respondents be offered the option of selecting one or more racial 
designations.
    On November 27, 2002, we published a rule proposing to codify a 
general requirement for the new racial ethnic data collection and 
reporting procedures in the FSP regulations to comply with OMB policy 
while dropping the technical details such as the racial/ethnic 
classifications from the regulations in order to maintain flexibility 
for any future changes in the data collection and reporting procedures. 
On the same day we published a Notice on the proposed information 
collection requirements for public comment. The detailed procedures, 
which were proposed in the preambles of these documents, would be 
provided to State agencies in an implementing memorandum. The period 
for comment ended on January 27, 2003. We received comments from 7 
State agencies, 1 State agency organization, 15 advocate groups, and 1 
legal aid office. For a full understanding of the background of the 
provisions in this rule, see the proposed rulemaking and Notice, which 
were published in the Federal Register at 67 FR 70861 and 70916, 
respectively.

7 CFR 272.6(g)--Data Collection by State Agencies

    Under the revised standards, there are five categories for race and 
two categories for ethnicity. The new racial categories are American 
Indian or Alaska Native, Asian, Black or African American, Native 
Hawaiian or Other Pacific Islander, and White. The revised standards 
allow individuals to choose more than one race to describe themselves. 
The revised categories on ethnicity are ``Hispanic or Latino'', and 
``Not Hispanic or Latino.'' The State agency must include these racial 
and ethnic categories on the State agency's application or data input 
screen.
    Several State agencies were concerned that the collection of 
multiple race data would lengthen the application process for 
participants and caseworkers, making it more burdensome and complex. 
They felt more time would be spent explaining the data collection to 
participants. We believe State agencies will be able to efficiently 
collect the data for the new categories without serious difficulty. The 
OMB standards came out in 1997. We note that the Census Bureau 
collected the data for Census 2000 and other Federal programs like the 
Temporary Assistance for Needy Families (TANF) have been collecting the 
data under the new categories, so most applicants by now should be 
familiar with the new categories and format used in Federal programs.
    We proposed that to ensure data quality, the State agency's 
application or data input screen must use separate questions for 
collecting ethnicity and race, with ethnicity requested first. One 
State agency felt that the sequence of the two questions was irrelevant 
since the data is voluntary for the participant and since the data have 
to be collected by the State agency for both questions. The proposed 
sequence is in compliance with the OMB standards which specify that 
ethnicity be collected first. The sequence allows individuals of 
Hispanic origin to identify their ethnicity, as they have done in the 
past, and then in the next question to identify their race, which they 
may now do. This sequence agrees with TANF Program data collection 
requirements and other Federal programs, making the data collection 
format standard across Federal programs. Therefore, we have retained 
the requirement that the application collect ethnicity first, then the 
race.
    One State agency asked whether two separate fields are required for 
``Hispanic or Latino'' and ``Not Hispanic or Latino'' on their 
application and information system or whether a yes or no response to 
the Hispanic or Latino field is sufficient. We note that the TANF 
program uses a yes or no field for ``Hispanic or Latino.'' The intent 
of the two ethnic categories is to allow separate counts of Hispanic 
and non-Hispanic data. Since yes and no responses to the Hispanic or 
Latino question would allow a State the basis to compile separate data 
on Hispanic individuals and non-Hispanic individuals, a yes/no field 
for Hispanic or Latino would be sufficient.
    One State agency recommended that a sixth category for multiple 
races be added to the other five racial categories on the application, 
designating that the individual says multiple racial categories apply. 
This is not permitted under the OMB standards. The comment is not 
adopted.
    We proposed to continue current policy that the State agency must 
develop alternative means of collecting racial and ethnic data on 
households, such as by observation during the interview, when the 
information is not provided voluntarily by the household on the 
application form. Several State agencies felt that the collection of 
racial data by the caseworker via observation of an applicant's race 
when the applicant declines to self-identify results in the collection 
of unreliable data. One State agency commented that caseworkers have 
varying capabilities and comfort levels in eliciting racial and ethnic 
information from participants who decline to answer or in assessing the 
racial and ethnic category via visual observation in a manner that is 
culturally sensitive and acceptable to applicants. Another State agency 
suggested the application have a ``declined'' category for those who 
decline to report their race. Another suggested that in place of 
observation we expand the alternatives to observation and allow State 
agencies to extrapolate the data from those who voluntarily report and 
adjust the State totals accordingly.
    It is current Federal policy that observation be used to collect 
the data when the applicant chooses not to self-identify so workers 
already do this. However, we do understand the States' concerns. We 
believe it is better to collect the data, to the best of the 
caseworker's ability, through observation than to not attempt to 
collect the data at all simply because the applicant declines to 
voluntarily provide it. The notice proposed that when visual 
observation is used, the caseworker need collect only one race for any 
applicant along with the ethnicity. This is similar to what caseworkers 
currently do under the old policy which directed caseworkers to assign 
any household to only one racial category. Caseworkers should use their 
best judgment via observation in determining which category best 
applies for people who appear to be multi-racial. By not allowing 
States to extrapolate the data in place of observation, FNS, by 
comparing household participation data to racial counts, can determine 
the number and percentage of individuals who are of an unknown race 
because the applicant did not report and the caseworker was unable to 
observe. While we are keeping the policy as proposed, we will consider 
other alternatives to observation that a State agency may suggest in 
detail on a case-by-case basis.
    One State agency asked how to categorize applicants if the face-to-
face interview is replaced with a telephone interview and the applicant 
chooses not to report his or her race. If the State agency is unable to 
observe the applicant's race and ethnicity and the applicant does not 
provide the information, the caseworker should leave the race and 
ethnic field blank. The unknowns need not be compiled in the State's 
system and will not be

[[Page 28762]]

reported anywhere on the Form FNS-101. However, FNS reserves the right 
to calculate the number of household contacts that are of ``Unknown 
Race'' based on a comparison of household participation and 
participation by race counts.
    State agencies currently collect the data by ``household'' with 
each household unit being counted under only one race. In actuality, 
most State agencies collect racial/ethnic data for one person in the 
household, normally the person who completes the application or is 
interviewed. This is done because the reporting of racial information 
by an applicant is voluntary and not all household members are required 
to be present for the eligibility interview. State agencies may 
continue to collect the data for one person per household (called the 
household contact) but must use the revised racial and ethnic 
categories and provide for multiple race reporting.

7 CFR 272.6(h)--Compiling and Reporting the Data

    The proposed rule noted that while there will be 5 single races and 
the ethnicity question on the application form, the choosing of a 
single race or a combination of races along with ethnicity response can 
produce a total of 62 possible racial and ethnic categories for 
compilation purposes. Allowing for all the ``detailed'' race 
distributions, there could be 5 single race groups, 10 two-race 
combinations, 10 three-race combinations, 5 four-race combinations, and 
1 five-race combination for a total of 31 categories. The Hispanic 
count by race would then produce a second set of 31 categories by race. 
The proposed rule and notice proposed that State agencies compile the 
data for all 62 possible racial categories including the combinations, 
maintain it by county, and report statewide for 26 categories. Several 
State agencies were concerned that the programming for all the 
categories for compiling and maintaining the data would be costly at a 
time of record breaking State budget deficits. It would divert limited 
financial resources to data-gathering functions when more significant 
priorities exist. One State agency felt that maintaining data for 62 
categories would be burdensome since a number of categories will have 
little or no data. One State agency recommended that States only report 
the five single races and a catchall multiple race category. The State 
agency organization suggested that FNS collect the data through the 
Quality Control sample rather than have States compile the data in 
their information systems and report compiled data to FNS.
    After careful consideration, FNS has decided it will collect from 
State agencies data on 20 racial and ethnic categories, plus total 
counts. This will consist of the number of people who selected only one 
racial category, separately for each of the five racial categories, and 
a count for the following combinations:
    (1) American Indian or Alaska Native and White.
    (2) Asian and White.
    (3) Black or African American and White.
    (4) American Indian or Alaska Native and Black or African American.
    (5) The balance of respondents reporting more than one race.
    In addition, we will collect data from State agencies on the number 
of persons in each racial category (above) who are Hispanic or Latino. 
In total, this is slightly less than the 26 categories originally 
proposed in the notice and proposed rule. The combination categories 
for reporting purposes are the four most common combinations according 
to Census data and are in accordance with the 1997 OMB guidelines for 
all Federal agencies.
    Currently, FNS collects data on 6 racial ethnic categories 
(including the total count) from 2,616 project areas (typically 
counties) for the FSP. However, with the increase in data elements, we 
proposed that State agencies just report State level data to FNS but 
maintain project area data for FNS reviewers. Fifteen advocate groups 
and a legal aid office asked FNS to reconsider this proposed decision 
and suggested FNS should require States to continue to report project 
area data to FNS. They contended that the lack of project area data 
would make it harder for advocacy groups and legal aid offices to 
monitor a State agency's practices to see if they have the effect of 
discriminating against racial minorities. They would face undue burdens 
of time and expense in requesting and obtaining project area data from 
all States rather than getting it from FNS and may not get the data 
from some States. They feel FNS is too thinly-staffed to do a 
comprehensive review of this data in State agency offices. Finally, 
they argue that reporting project area data would not unduly burden 
States because States would still have to collect the project area 
data, and program their computers to provide this information to FNS 
for on-site visits. They note that once collected by project area at 
the State, having States report project area totals directly to FNS 
would not be that much more of a burden than maintaining it on-site.
    After careful consideration of all the comments, we have decided to 
continue the current policy to collect project area data from State 
agencies. Project area data will allow us to continue to monitor local 
office activity and to ensure compliance with civil rights enforcement. 
Collecting the data through the Quality Control system as one commenter 
proposed is not adequate for project level data. While the quality 
control sample would provide a reliable estimate for the State, it 
would not provide a reliable estimate for a project area due to the 
small sample size in a project area. State agencies will need to 
compile and maintain the data for all categories by project area for 
FNS review. The data must be kept in an easily retrievable form and be 
made available to FNS upon request. While we recognize that there is a 
burden on State agencies to program their systems to compile the new 
data, once the data is compiled, the actual reporting to FNS thereafter 
will be a minimal burden for State agencies.
    State agencies must collect racial and ethnic data on the household 
contact on the application. The State agency will have to modify their 
information system to store and compile data on all categories under 
this requirement and report to FNS by project area on the 20 racial and 
ethnic categories mentioned above on the Form FNS-101.
    The State agency must maintain all applications received by the 
project area office for onsite review by FNS staff during civil rights 
reviews.
    In February 2004, FNS modified its information system to allow 
States and project areas to report the current FNS-101 electronically 
by project area to FNS' information system. FNS' system will be further 
modified to accept the new FNS-101 electronically in the upcoming 
months.

Implementation

    This will apply to all new applications received on or after the 
implementation date of April 1, 2007 as explained below. Several State 
agencies had indicated that it will take at least 12 months after the 
effective date to get a new application on all existing cases. One 
commenter asked about waivers if State agencies need more time. We 
understand State agencies' concerns about converting the existing 
caseload. By applying the new requirements solely to new applications 
and recertifications, we are not requiring caseload conversion outside 
the normal application process. The maximum certification period is 12 
months for

[[Page 28763]]

most households, but the certification period may be lengthened to 24 
months for households in which all adult members are elderly or 
disabled. Under the normal application process, we expect most cases to 
be under the new data collection requirement in 12 months. However, we 
understand that a small percentage of cases, the households with 
extended certification periods, may take up to 2 years to fall under 
the new data collection.
    This rule is effective June 19, 2006. State agencies may implement 
the provisions of this rule anytime after June 19, 2006 but must 
implement the data collection no later than April 1, 2007 for all new 
applications. This will allow reporting of the new data for the report 
month of July 2007 for part of the caseload. The Form FNS-101 currently 
in use would remain in effect for the fiscal year 2006 reporting period 
for all State agencies.

List of Subjects in 7 CFR Part 272

    Alaska, Civil rights, Food stamps, Grant programs-social programs, 
Reporting and recordkeeping requirements.

0
Accordingly, 7 CFR part 272 is amended as follows:

PART 272--REQUIREMENTS FOR PARTICIPATING STATE AGENCIES

0
1. The authority citation for part 272 continues to read as follows:

    Authority: 7 U.S.C. 2011-2036.


0
2. In Sec.  272.6, paragraphs (g) and (h) are revised to read as 
follows:


Sec.  272.6  Nondiscrimination compliance.

* * * * *
    (g) Data collection. The State agency must obtain racial and ethnic 
data on participating households in the manner specified by FNS. The 
application form must clearly indicate that the information is 
voluntary, that it will not affect the eligibility or the level of 
benefits, and that the reason for the information is to assure that 
program benefits are distributed without regard to race, color, or 
national origin. The State agency must develop alternative means of 
collecting the ethnic and racial data on households, such as by 
observation during the interview, when the information is not provided 
voluntarily by the household on the application form.
    (h) Reports. As required by FNS, the State agency must report the 
racial and ethnic data on participating household contacts on forms or 
formats provided by FNS.

    Dated: May 10, 2006.
Roberto Salazar,
Administrator.
[FR Doc. 06-4662 Filed 5-17-06; 8:45 am]
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