[Federal Register Volume 74, Number 72 (Thursday, April 16, 2009)]
[Rules and Regulations]
[Pages 17589-17591]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-8685]



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  Federal Register / Vol. 74, No. 72 / Thursday, April 16, 2009 / Rules 
and Regulations  

[[Page 17589]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 948

[Doc. No. AMS-FV-08-0094; FV09-948-1 IFR]


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

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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

SUMMARY: This rule modifies the minimum size requirement 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). Currently, Colorado Area No. 2 potatoes must be 
U.S. No. 2 or better grade and most varieties must be at least 2 inches 
in diameter or 4 ounces in weight, except that round potatoes may be of 
any weight. For most long potato varieties, this rule changes the 
minimum size requirement from 2 inches in diameter to 1\7/8\ inches in 
diameter and removes the minimum weight requirement. This change is 
intended to improve the marketing of Colorado Area No. 2 potatoes and 
increase returns to producers as well as provide consumers with 
increased supplies of potatoes.

DATES: Effective April 17, 2009; comments received by June 15, 2009 
will be considered prior to issuance of a final rule.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposal. Comments must be sent to the Docket Clerk, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938, or Internet: http://www.regulations.gov. All comments should reference the document number 
and the date and page number of this issue of the Federal Register and 
will be available for public inspection in the Office of the Docket 
Clerk during regular business hours, or can be viewed at: http://www.regulations.gov. All comments submitted in response to this rule 
will be included in the record and will be made available to the 
public. Please be advised that the identity of the individuals or 
entities submitting the comments will be made public on the Internet at 
the address provided above.

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 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 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 modifies the minimum size requirement for most potatoes 
handled under the order. The exceptions to these requirements are for 
potatoes handled under the size designations referred to in the U.S. 
Standards as ``Size B'' and ``creamers.'' The revisions described in 
this rule are made to the handling regulations for all regulated 
potatoes except those potatoes considered ``Size B'' or ``creamers.'' 
The current size requirements for ``Size B'' and ``creamers'' remain 
unchanged. The discussion hereafter is intended to reflect the same.
    Except as explained above, the minimum size requirement for 
Colorado Area No. 2 potatoes currently allows the handling of potatoes 
that are at least 2 inches in diameter or 4 ounces in weight (round 
potatoes may be of any weight). For long potato varieties, this rule 
changes the minimum size requirement from 2 inches in diameter to 1\7/
8\ inches in diameter and removes the minimum weight requirement. This 
rule was recommended by the Committee at a meeting on August 21, 2008.
    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

[[Page 17590]]

948.24, such potatoes must be inspected by the Federal-State Inspection 
Service, and certified as meeting the applicable requirements of such 
regulations.
    For marketing order purposes, the State of Colorado is divided into 
three areas. 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. 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 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 
Colorado potatoes grown in Area No. 2 are contained in Sec.  948.386 of 
the order's rules and regulations.
    According to the Committee, quality assurance is very important to 
the industry and its customers. Providing the public with acceptable 
quality potatoes that are appealing to the consumer on a consistent 
basis is necessary to maintain buyer confidence in the marketplace.
    The growing season for Colorado Area No. 2 is normally very short 
because potatoes are grown in the San Luis Valley at an altitude of 
7,600 feet. Adverse weather has a large impact on yield and potato size 
at high altitudes. In spring 2008, wet weather delayed planting and 
emergence of the crop. An early June frost, when potato plants were 
just emerging, further damaged the crop. Numerous hail storms, 
including a severe storm in mid-August, caused significant damage to 
nearly 20 percent of the Area No. 2 potato acreage. In all, adverse 
weather conditions were responsible for significantly lower crop yields 
in the 2008 season.
    U.S. potato acreage in 2008 is estimated to be 8 percent lower than 
in 2007, resulting in limited supplies of potatoes nationwide. The 
production of alternate rotation crops, such as wheat and corn, has 
become more profitable than the production of potatoes, causing 
producers to reduce potato acreage. These conditions have resulted in 
the smallest supply of potatoes in nearly 20 years.
    In 2007, the Committee recommended tightening the minimum size 
requirements from 1\7/8\ inches to 2 inches in diameter or 4 ounces 
minimum weight for all non-excepted varieties potatoes, except that 
round varieties could be handled without weight limitations. This 
action was based in part on the higher yield and sales of the 2006 
season. This change was effective on January 31, 2008 (73 FR 5422).
    Taking into account lower estimated 2008 U.S. potato acreage and 
poor weather conditions in Area No. 2, the Committee recommended 
relaxing the minimum size regulation. The Committee believes that the 
size relaxation should increase the volume of potatoes meeting the 
order's handling requirements, thus fulfilling market demands.
    Twelve members voted in favor of the modification and one member 
voted in opposition. The dissenting member was concerned that, even 
though his crop would be small, the shipper who packs his potatoes 
would want larger potatoes. However, the majority of the Committee 
believes that this change will provide potato handlers with more 
marketing flexibility, producers with increased returns, and consumers 
with a greater supply of Colorado Area No. 2 potatoes.
    This rule will not impact imported potatoes covered by section 
608(e) of the Act.

Initial 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 initial 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 73 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 $7,000,000, and small agricultural 
producers are defined as those having annual receipts of less than 
$750,000.
    During the 2007-2008 marketing year, approximately 14,225,568 
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 $12.05 per hundredweight, the Committee estimates that 
62 Area No. 2 handlers, or about 85 percent, had annual receipts of 
less than $7,000,000. 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 2007 was $9.85 per hundredweight. The average 
annual fresh potato revenue for the Colorado Area No. 2 potato 
producers is therefore calculated to be approximately $778,455. 
Consequently, on average, the majority of the Area No. 2 Colorado 
potato producers may not be classified as small entities.
    For long potatoes that are considered neither ``Size B'' nor 
``creamer'' size potatoes, this rule changes the minimum size 
requirement from 2 inches in diameter to 1 7/8 inches in diameter and 
removes the minimum weight requirement. Authority for this action is 
contained in Sec. Sec.  948.21 and 948.22.
    In 2007, handlers were unable to adequately supply the fresh market 
because of low yields due to poor weather conditions and because of 
more restrictive regulations. Adverse weather conditions have 
contributed to lower yields and short supplies of potatoes for the 
market again in the 2008-2009 season. The Committee believes that 
relaxing the minimum size and weight requirements on long potato 
varieties will allow handlers to market a larger portion of the crop in 
fresh market outlets, and thus better meet demand. This change is 
expected to foster increased consumption and have a positive impact on 
the Colorado potato industry.
    This change is expected to improve returns to producers. This rule 
is a relaxation of the current size regulation and, as such, should 
have a positive impact on industry participants. The Committee believes 
that this change would not negatively impact either handlers or 
producers.
    The Committee discussed alternatives to this rule. One alternative 
included making no change at all to the current regulation. The 
Committee did not believe this alternative would meet the needs of 
buyers or benefit the industry.
    This rule will not impose any additional reporting or recordkeeping 
requirements on either small or large Colorado Area No. 2 potato 
handlers. As with all Federal marketing order programs, reports and 
forms are periodically reviewed to reduce

[[Page 17591]]

information requirements and duplication by industry and public sector 
agencies. Furthermore, USDA has not identified any relevant Federal 
rules that duplicate, overlap or conflict with this rule.
    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.
    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 
21, 2008, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue. Finally, interested 
persons are invited to submit comments on this interim final rule, 
including the regulatory and informational impacts of this action on 
small businesses.
    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/AMSv1.0/ams.fetchTemplateData.do?template=TemplateN&page=MarketingOrdersSmallBusinessGuide. Any questions about the compliance guide should be sent to 
Jay Guerber at the previously mentioned address in the FOR FURTHER 
INFORMATION CONTACT section.
    This rule invites comments on a modification of the handling 
regulation currently prescribed under the Colorado Area No. 2 potato 
marketing order. Any comments timely received will be considered prior 
to finalization of this rule.
    After consideration of all relevant material presented, including 
the Committee's recommendation, and other information, it is found that 
this interim final rule, as hereinafter set forth, will tend to 
effectuate the declared policy of the Act.
    Pursuant to 5 U.S.C. 553, it is also found and determined upon good 
cause that it is impracticable, unnecessary, and contrary to the public 
interest to give preliminary notice prior to putting this rule into 
effect and that good cause exists for not postponing the effective date 
of this rule until 30 days after publication in the Federal Register 
because: (1) This rule relaxes the minimum size and weight requirements 
for most long potatoes; (2) handlers are already shipping potatoes from 
the 2008-2009 crop; (3) the Committee recommended this change at a 
public meeting and all interested parties had an opportunity to express 
their views and provide input; and (4) this rule provides a 60-day 
comment period and any comments received will be considered prior to 
finalization of this 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, 1\7/8\ inches 
minimum diameter.
* * * * *

    Dated: April 9, 2009.
Robert C. Keeney,
Acting Associate Administrator, Agricultural Marketing Service.
[FR Doc. E9-8685 Filed 4-15-09; 8:45 am]
BILLING CODE