[Federal Register Volume 72, Number 85 (Thursday, May 3, 2007)]
[Rules and Regulations]
[Pages 24530-24532]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-8459]


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

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 966

[Docket No. AMS-FV-06-0208; FV07-966-1 FIR]


Tomatoes Grown in Florida; Change in Handling Requirements

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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

SUMMARY: The Department of Agriculture (USDA) is adopting, as a final 
rule, without change, an interim final rule changing the handling 
requirements currently prescribed under the Florida Tomato marketing 
order (order). The order regulates the handling of tomatoes grown in 
Florida, and is administered locally by the Florida Tomato Committee 
(Committee). This rule continues in effect the action that limited the 
use of inverted lids on tomato containers to the handler whose 
information initially appeared on the lid. This rule helps ensure that 
lids do not contain the information for more than one active handler 
and aids in maintaining the positive identification and traceability of 
Florida tomatoes.

EFFECTIVE DATE: June 4, 2007.

FOR FURTHER INFORMATION CONTACT: William Pimental, Marketing 
Specialist; or Christian Nissen, Regional Manager, Southeast Marketing 
Field Office, Marketing Order Administration Branch, Fruit and 
Vegetable Programs, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 
325-8793, or E-mail: [email protected] or 
[email protected].
    Small businesses may request information on complying with this 
regulation by contacting Jay Guerber, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence 
Avenue SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-
2491, Fax: (202) 720-8938, or E-mail: [email protected].

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement No. 125 and Order No. 966, both as amended (7 CFR part 966), 
regulating the handling of tomatoes grown in Florida, hereinafter 
referred to as the ``order.'' The order is effective under the 
Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-
674), hereinafter referred to as the ``Act.''
    USDA is issuing this rule in conformance with Executive Order 
12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect. 
This rule will not preempt any State or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with this 
rule.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA a petition 
stating that the order, any provision of the order, or any obligation 
imposed in connection with the order is not in accordance with law and 
request a modification of the order or to be exempted therefrom. A 
handler is afforded the opportunity for a hearing on the petition. 
After the hearing USDA would rule on the petition. The Act provides 
that the district court of the United States in any district in which 
the handler is an inhabitant, or has his or her principal place of 
business, has jurisdiction to review USDA's ruling on the petition, 
provided an action is filed not later than 20 days after the date of 
the entry of the ruling.
    This rule continues in effect the action that changed the handling 
requirements currently prescribed under the order. This rule continues 
to limit the use of inverted lids on tomato containers to the handler 
whose information initially appeared on the lid. This rule helps ensure 
that lids do not contain the information for more than one active 
handler and aids in maintaining the positive identification and 
traceability of Florida tomatoes. This action was unanimously 
recommended by the Committee at a meeting on October 4, 2006.
    Section 966.52 of the order provides the authority to establish 
pack and container requirements for tomatoes grown under the order. 
This includes fixing the size, weight, capacity, dimensions, markings, 
or pack of the container or containers which may be used in the 
handling of tomatoes.
    Section 966.323 of the order's administrative rules prescribes the 
handling regulations for Florida tomatoes. Section 966.323(a)(3) 
delineates the requisite container requirements for weight, markings, 
and appearance. The section specifies, in part, that each container or 
lid must show the name and address of the registered handler.
    The majority of Florida tomatoes are packed in containers that have 
a separate lid. Most lids are preprinted with the handler's name and 
address. In addition, most lids can be inverted by reversing the lid so 
the blank side is on the outside, and the preprinted information is 
flipped to the underside of the lid. This is done so new information 
can be printed on the lid. This rule amends Sec.  966.323(a)(3) by 
limiting the use of inverted lids on tomato containers to the handler 
whose information first appeared on the lid.
    Inverted lids have been used in minimal quantities in past seasons, 
usually when a tomato packing operation was purchased by another 
entity. Any containers included in the purchase could be used by the 
purchasing handler by inverting the lids so the purchaser's information 
could be affixed on the clean side. Usually there were not many 
containers remaining, so the containers requiring inverted lids were 
fairly limited in quantity.
    Recently, container sales companies have started offering their 
container overruns at discounted prices to tomato handlers. These 
containers usually have preprinted handler and product information on 
the lids. The Committee is concerned this could significantly increase 
the number of inverted lids being used by the industry and could pose 
problems with the positive identification and traceability of tomatoes.
    In their discussion of this issue, the Committee agreed the ability 
to positively identify product is a necessity in today's marketplace. 
The Committee expressed concern that the practice of

[[Page 24531]]

inverting lids could result in misidentification and confusion in cases 
where tomatoes need to be traced back to their origin. The Committee 
recognized that in the past, most of the containers being used with an 
inverted lid were associated with a handler purchasing another 
operation. Consequently, the original owner of the lid was no longer in 
business, and the container was only printed with the information for 
one active handler.
    This would not be the case with handlers using overrun containers. 
The overrun containers being made available are containers produced in 
excess of orders, with the majority preprinted with handler 
information. Therefore, once inverted, the lids on the overrun 
containers would be printed with the information for two active 
handlers. The Committee is concerned that having multiple handler 
information on a container, even with the lid inverted, could pose 
problems when trying to track tomatoes back to the original handler.
    The Committee believes it is of critical importance that Florida 
tomatoes can be traced from the farm to the end-user. Proper handler 
identification on a container is an important part of this 
traceability. Allowing the use of containers with an active registered 
handler's information on the exterior of the lid and another on the 
interior could allow for misidentification and confusion in product 
identification. The Committee believes by limiting the use of inverted 
lids to the handler whose name originally appeared on the lid, positive 
identification and traceability is better maintained.
    In addition, in cases related to marketing order compliance, it is 
also important to be able to identify the original source of tomatoes. 
Allowing the use of inverted lids could result in the intentional 
misrepresentation of the origin of the tomatoes. The box lids could be 
re-inverted to display the handler information originally printed on 
the box without that handler's knowledge. Limiting the use of inverted 
lids on tomato containers by anyone other than the handler whose 
information first appeared on the lid helps alleviate any 
misidentification or uncertainty in product identification.
    Section 8e of the Act provides that when certain domestically 
produced commodities, including tomatoes, are regulated under a Federal 
marketing order, imports of that commodity must meet the same or 
comparable grade, size, quality, and maturity requirements. As this 
rule changes the container requirements under the domestic handling 
regulations, no corresponding change to the import regulations is 
required.

Final Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this action on small entities. Accordingly, AMS has 
prepared this final regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are unique in 
that they are brought about through group action of essentially small 
entities acting on their own behalf. Thus, both statutes have small 
entity orientation and compatibility.
    There are approximately 100 producers of tomatoes in the production 
area and approximately 70 handlers subject to regulation under the 
marketing order. Small agricultural producers are defined by the Small 
Business Administration (SBA) as those having annual receipts less than 
$750,000, and small agricultural service firms are defined as those 
whose annual receipts are less than $6,500,000 (13 CFR 121.201).
    Based on industry and Committee data, the average annual price for 
fresh Florida tomatoes during the 2005-06 season was approximately 
$10.27 per 25-pound container, and fresh shipments totaled 47,880,303 
25-pound cartons of tomatoes. Committee data indicates approximately 27 
percent of the handlers handle 95 percent of the total volume shipped 
outside the regulated area. Based on the average price, about 75 
percent of handlers could be considered small businesses under SBA's 
definition. In addition, based on production, grower prices as reported 
by the National Agricultural Statistics Service, and the total number 
of Florida tomato growers, the average annual grower revenue is below 
$750,000. Thus, the majority of handlers and producers of Florida 
tomatoes may be classified as small entities.
    This rule continues in effect the action that changed the handling 
requirements currently prescribed under the order. This rule continues 
to limit the use of inverted lids on tomato containers to the handler 
whose information initially appeared on the lid. This rule helps ensure 
that lids do not contain the information for more than one active 
handler and aids in maintaining the positive identification and 
traceability of Florida tomatoes. This rule revises Sec.  
966.323(a)(3), which specifies the requisite container requirements. 
Authority for this action is provided in Sec.  966.52 of the order. The 
Committee unanimously recommended this change at a meeting held on 
October 4, 2006.
    At the meeting, the Committee discussed the impact of this change 
on handlers in terms of cost. This rule could result in a slight 
increase in cost for handlers that were considering purchasing the 
container overruns. However, Committee members stated that plain 
containers are readily available on the market at reasonable prices. 
Consequently, the difference in cost between a discounted overrun 
container and a plain blank container should be minimal.
    In addition, last season the industry packed more than 47 million 
cartons of tomatoes. The available quantities of overrun containers are 
limited, confining the cost benefit to those containers available. When 
compared to the total containers needed, the overall cost savings 
associated with using overrun cartons would be negligible. Also, in 
previous seasons, overrun containers were not available for purchase. 
Therefore, container cost for all handlers should be similar to those 
in previous seasons.
    Further, this rule provides the benefit of helping to maintain the 
traceability and proper identification of Florida tomatoes, which 
outweighs the minor cost savings associated with using overrun 
containers. The costs and benefits of this rule are not expected to be 
disproportionately different for small or large entities.
    One alternative to this action was to allow the use of inverted 
lids. However, Committee members agreed that having the information for 
more than one active handler appear on a carton was confusing and could 
make traceability and proper identification difficult. Therefore, this 
alternative was rejected.
    The AMS is committed to complying with the E-Government Act, to 
promote the use of the Internet and other information technologies to 
provide increased opportunities for citizen access to Government 
information and services, and for other purposes.
    This action will not impose any additional reporting or 
recordkeeping requirements on either small or large tomato handlers. As 
with all Federal marketing order programs, reports and forms are 
periodically reviewed to reduce information requirements and 
duplication by industry and public sector agencies. In addition, as 
noted in the initial regulatory flexibility analysis,

[[Page 24532]]

USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this rule.
    Further, the Committee's meeting was widely publicized throughout 
the Florida tomato industry and all interested persons were invited to 
attend the meeting and participate in Committee deliberations. Like all 
Committee meetings, the October 4, 2006, meeting was a public meeting 
and all entities, both large and small, were able to express views on 
this issue.
    An interim final rule concerning this action was published in the 
Federal Register on February 6, 2007. Copies of the rule were mailed by 
the Committee's staff to all Committee members and tomato handlers. In 
addition, the rule was made available through the Internet by USDA and 
the Office of the Federal Register. That rule provided for a 60-day 
comment period which ended April 9, 2007. No comments were received.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/fv/moab.html. Any questions about the compliance 
guide should be sent to Jay Guerber at the previously mentioned address 
in the FOR FURTHER INFORMATION CONTACT section.
    After consideration of all relevant material presented, including 
the Committee's recommendation, and other information, it is found that 
finalizing the interim final rule, without change, as published in the 
Federal Register (72 FR 5327, February 6, 2007) will tend to effectuate 
the declared policy of the Act.

List of Subjects in 7 CFR Part 966

    Marketing agreements, Reporting and recordkeeping requirements, 
Tomatoes.

PART 966--TOMATOES GROWN IN FLORIDA

0
Accordingly, the interim final rule amending 7 CFR part 966 which was 
published at 72 FR 5327 on February 6, 2007, is adopted as a final rule 
without change.

    Dated: April 27, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
 [FR Doc. E7-8459 Filed 5-2-07; 8:45 am]
BILLING CODE 3410-02-P