[Federal Register Volume 73, Number 20 (Wednesday, January 30, 2008)]
[Rules and Regulations]
[Pages 5422-5424]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-1570]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 948

[Docket No. AMS-FV-07-0115; FV08-948-1 FR]


Irish Potatoes Grown in Colorado; Modification of the Handling 
Regulation for Area No. 2

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule modifies the minimum size requirements under the 
Colorado potato marketing order, Area No. 2. The marketing order 
regulates the handling of Irish potatoes grown in Colorado, and is 
administered locally by the Colorado Potato Administrative Committee, 
Area No. 2 (Committee). The minimum size requirements for Area No. 2 
potatoes specify that potatoes handled under the marketing order must 
be at least 2 inches in diameter or 4 ounces in weight, with exceptions 
allowing the handling of round potatoes of any weight, and Russet 
Burbank, Russet Norkotah, and Silverton Russet potato varieties with a 
minimum of 1\7/8\ inches in diameter or 4 ounces in weight. This rule 
removes the exception that Russet Burbank, Russet Norkotah, and 
Silverton Russet potato varieties may be 1\7/8\ inches in diameter, 
thus requiring these varieties to also meet the minimum requirements of 
2 inches in diameter or 4 ounces in weight. This change is intended to 
facilitate the handling and marketing of Colorado Area No. 2 potatoes.

DATES: Effective Date: January 31, 2008.

FOR FURTHER INFORMATION CONTACT: Teresa Hutchinson or Gary Olson, 
Northwest Marketing Field Office, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, Telephone: (503) 326-
2724, Fax: (503) 326-7440, 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 final rule is issued under Marketing 
Agreement No. 97 and Marketing Order No. 948, both as amended (7 CFR 
part 948), regulating the handling of Irish potatoes grown in Colorado, 
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.''
    The Department of Agriculture (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This final 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 final rule modifies the minimum size requirements under the 
order. The minimum size requirements for Area No. 2 potatoes specify 
that potatoes handled under the marketing order must be at least 2 
inches in diameter or 4 ounces in weight with exceptions allowing the 
handling of round potatoes of any weight, and Russet Burbank, Russet 
Norkotah, and Silverton Russet potato varieties with a minimum of 1\7/
8\ inches in diameter or 4 ounces in weight. This rule removes the 
exception that Russet Burbank, Russet Norkotah, and Silverton Russet 
potato varieties may be 1\7/8\ inches in diameter. This rule was 
recommended by the Committee at a meeting on August 16, 2007.
    Section 948.22 authorizes the issuance of grade, size, quality, 
maturity, pack, and container regulations for potatoes grown in the 
production area. Section 948.21 further authorizes the modification, 
suspension, or termination of requirements issued pursuant to Sec.  
948.22.
    Section 948.40 provides that whenever the handling of potatoes is 
regulated pursuant to Sec. Sec.  948.20 through 948.24, such potatoes 
must be inspected by the Federal-State Inspection Service, and 
certified as meeting the applicable requirements of such regulations.
    Under the order, the State of Colorado is divided into three areas 
of regulation for marketing order purposes. These include: Area No. 1, 
commonly known as the Western Slope, includes and consists of the 
counties of Routt, Eagle, Pitkin, Gunnison, Hinsdale, La Plata, and all 
counties west thereof; Area No. 2, commonly known as the San Luis 
Valley, includes and consists of the counties of Sanguache, Huerfano, 
Las Animas, Mineral, Archuleta, and all counties south thereof; and, 
Area No. 3 includes and consists of all the remaining counties in the 
State of Colorado which are not included in Area No. 1 or Area No. 2. 
The order

[[Page 5423]]

currently regulates the handling of potatoes grown in Areas No. 2 and 
No. 3 only; regulation for Area No. 1 is currently not active.
    Grade, size, and maturity regulations specific to the handling of 
potatoes grown in Area No. 2 are contained in Sec.  948.386 of the 
order.
    On August 16, 2001, the Committee recommended increasing the 
minimum size requirements from 1\7/8\ inches to 2 inches in diameter or 
4 ounces minimum weight for all varieties of potatoes, except for round 
varieties and the Russet Burbank, Russet Norkotah, and Silverton Russet 
varieties. This recommendation was made effective July 15, 2002 (67 FR 
40844). The Russet Burbank, Russet Norkotah, and Silverton Russet 
varieties were left at 1\7/8\ inches minimum diameter.
    The Committee believes that the demand for fresh potatoes has 
decreased over the last several years and that there are currently 
abundant supplies in the marketplace. Market data also shows that 
consumers prefer larger, higher quality potatoes. After reviewing such 
market data over the past six years, the Committee decided to recommend 
removing the minimum size exception for Russet Burbank, Russet 
Norkotah, and Silverton Russet varieties. The Committee believes that 
providing the sizes desired is necessary to maintain consumer 
confidence in the marketplace. The Committee also believes that most 
Colorado potato handlers have already been shipping Russet varieties 
with a minimum size of 2 inches in diameter or 4 ounces in weight.
    Russet potatoes subject to the order's handling regulation will 
meet the size requirements if they are at least 2 inches in diameter or 
4 ounces in weight. Some long, thin potatoes might be smaller than 2 
inches in diameter, but weigh at least 4 ounces. These potatoes would 
meet the revised size requirements. Some potatoes might weigh less than 
4 ounces, but be at least 2 inches in diameter. These potatoes would 
also meet the revised minimum size requirements.
    Twelve members voted in favor of the modification and one member 
voted in opposition. The dissenting member was concerned that some 
industry members who produce smaller Russet potatoes might not support 
the change. The Committee made the recommendation to provide buyers 
with the sizes they prefer and to maintain buyer confidence, thus 
facilitating the handling and marketing of Colorado Area No. 2 potatoes 
and improving producer returns.

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 rules issued thereunder, are unique in that 
they are brought about through group action of essentially small 
entities acting on their own behalf.
    There are approximately 77 handlers of Colorado Area No. 2 potatoes 
subject to regulation under the order and approximately 180 producers 
in the regulated production area. Small agricultural service firms are 
defined by the Small Business Administration (13 CFR 121.201) as those 
having annual receipts of less than $6,500,000, and small agricultural 
producers are defined as those having annual receipts of less than 
$750,000.
    During the 2006-2007 marketing year, approximately 16,061,432 
hundredweight of Colorado Area No. 2 potatoes were inspected under the 
order and sold into the fresh market. Based on an estimated average 
f.o.b. price of $11.00 per hundredweight, the Committee estimates that 
66 Area No. 2 handlers, or about 86 percent, had annual receipts of 
less than $6,500,000. In view of the foregoing, the majority of 
Colorado Area No. 2 potato handlers may be classified as small 
entities.
    In addition, based on information provided by the National 
Agricultural Statistics Service (NASS), the average producer price for 
Colorado potatoes for 2006 was $8.80 per hundredweight. The average 
annual fresh potato revenue for each Colorado Area No. 2 potato 
producer is therefore calculated to be approximately $785,226. 
Consequently, on average, the majority of the Area No. 2 Colorado 
potato producers may not be classified as small entities.
    This final rule removes from the handling regulation the exception 
that Russet Burbank, Russet Norkotah, and Silverton Russet varieties of 
Area No. 2 Colorado potatoes may be 1\7/8\ inches in diameter. This 
rule will thus have the effect of increasing the minimum size 
requirement for Russet potatoes from 1\7/8\ inches in diameter or 4 
ounces in weight to 2 inches in diameter or 4 ounces in weight.
    Authority for this action is contained in Sec. Sec.  948.21, 
948.22, 948.40, and 948.386.
    NASS estimated planted acreage for the 2006 crop in Area No. 2 at 
59,900 acres, an increase of 1,700 acres when compared with 58,200 
acres planted in 2005. In 2006, NASS data shows that Russet Norkotah, 
the most popular variety, was planted on 60.3 percent of the total 
potato acreage. Other Russet varieties accounted for 20.6 percent of 
the total acres planted, with various other varieties making up the 
remaining 19.1 percent.
    Based on Committee records, 89.6 percent of Area No. 2 potatoes 
entered the fresh market during the 2006-2007 marketing year (including 
potatoes produced for seed). Of those potatoes, Russet potato varieties 
accounted for 89.2 percent.
    Only a small portion of the crop is expected to be affected by the 
size increase (i.e., that portion of Russet Burbank, Russet Norkotah, 
or Silverton Russet varieties smaller than 2 inches in diameter or 4 
ounces in weight, but larger than 1\7/8\ inches in diameter). Based on 
current customer demand, many handlers are already shipping 2-inch 
minimum diameter Russet potatoes. The Committee believes that the 
expected benefits of improved quality, increased purchases and sales 
volume, and increased returns received by producers will greatly 
outweigh the costs related to the regulation.
    After discussing possible alternatives to this rule, the Committee 
determined that an increase in the minimum size for Russet varieties 
would increase returns to producers while supplying the market with a 
higher percentage of larger high quality potatoes. The Committee 
believes that the expected benefits are improved quality, increased 
purchases and sales volume, and increased returns received by 
producers. During its deliberations, the Committee also considered 
increasing the minimum size to 2\1/8\ inches or 5 ounces in weight for 
Russet varieties. However, the Committee decided that increasing the 
minimum size from 1\7/8\ inches diameter to 2\1/8\ inches in diameter 
would be too restrictive at this time.
    This final rule increases the size requirements for Russet 
varieties of potatoes under the order. Accordingly, this action will 
not impose any additional reporting or recordkeeping requirements on 
either small or large Russet potato 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.

[[Page 5424]]

    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.
    As noted in the initial regulatory flexibility analysis, USDA has 
not identified any relevant Federal rules that duplicate, overlap or 
conflict with this final rule.
    In addition, the Committee's meeting was widely publicized 
throughout the Colorado Area No. 2 potato industry and all interested 
persons were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the August 
16, 2007, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue.
    A proposed rule concerning this action was published in the Federal 
Register on December 11, 2007 (72 FR 70244). Copies of the rule were 
mailed or sent via facsimile to all Committee members and handlers. The 
rule was also made available through the Internet by USDA and the 
Office of the Federal Register. A 15-day comment period ending December 
26, 2007, was provided to allow interested persons to respond to the 
proposal. 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 matter presented, including the 
information and recommendation submitted by the Committee and other 
available information, it is hereby found that this rule, as 
hereinafter set forth, will tend to effectuate the declared policy of 
the Act.
    It is further found that good cause exists for not postponing the 
effective date of this rule until 30 days after publication in the 
Federal Register (5 U.S.C. 553) because handlers are already shipping 
potatoes from the 2007-2008 crop. Further, handlers are aware of this 
rule which was recommended at a public meeting. Also, a 15-day comment 
period was provided for in the proposed rule.

List of Subjects in 7 CFR Part 948

    Marketing Agreements, Potatoes, Reporting and recordkeeping 
requirements.

0
For the reasons set forth in the preamble, 7 CFR part 948 is amended as 
follows:

PART 948--IRISH POTATOES GROWN IN COLORADO

0
1. The authority citation for 7 CFR part 948 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.


0
2. Amend Sec.  948.386 by revising paragraph (a)(2) to read as follows:


Sec.  948.386  Handling regulation.

* * * * *
    (a) * * *
    (2) All other varieties. U.S. No. 2, or better grade, 2 inches 
minimum diameter or 4 ounces minimum weight.
* * * * *

    Dated: January 24, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E8-1570 Filed 1-29-08; 8:45 am]
BILLING CODE 3410-02-P