[Federal Register Volume 77, Number 223 (Monday, November 19, 2012)]
[Rules and Regulations]
[Pages 69381-69388]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-28045]



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  Federal Register / Vol. 77, No. 223 / Monday, November 19, 2012 / 
Rules and Regulations  

[[Page 69381]]



DEPARTMENT OF AGRICULTURE

Office of Procurement and Property Management

7 CFR Part 3201

RIN 0599-AA15


Designation of Product Categories for Federal Procurement

AGENCY: Office of Procurement and Property Management, USDA.

ACTION: Final rule.

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SUMMARY: The U.S. Department of Agriculture (USDA) is amending the 
Guidelines for Designating Biobased Products for Federal Procurement, 
to add 12 sections to designate product categories within which 
biobased products will be afforded Federal procurement preference, as 
provided for under section 9002 of the Farm Security and Rural 
Investment Act of 2002, as amended by the Food, Conservation, and 
Energy Act of 2008 (referred to in this document as ``section 9002''). 
USDA is also establishing minimum biobased contents for each of these 
product categories.

DATES: This rule is effective December 19, 2012.

FOR FURTHER INFORMATION CONTACT: Ron Buckhalt, USDA, Office of 
Procurement and Property Management, Room 361, Reporters Building, 300 
7th St. SW., Washington, DC 20024; email: [email protected]; phone 
(202) 205-4008. Information regarding the Federal biobased preferred 
procurement program (one part of the BioPreferred Program) is available 
on the Internet at http://www.biopreferred.gov.

SUPPLEMENTARY INFORMATION: The information presented in this preamble 
is organized as follows:

I. Authority
II. Background
III. Discussion of Public Comments
IV. Regulatory Information
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Regulatory Flexibility Act (RFA)
    C. Executive Order 12630: Governmental Actions and Interference 
With Constitutionally Protected Property Rights
    D. Executive Order 12988: Civil Justice Reform
    E. Executive Order 13132: Federalism
    F. Unfunded Mandates Reform Act of 1995
    G. Executive Order 12372: Intergovernmental Review of Federal 
Programs
    H. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    I. Paperwork Reduction Act
    J. E-Government Act
    K. Congressional Review Act

I. Authority

    These product categories are designated under the authority of 
section 9002 of the Farm Security and Rural Investment Act of 2002 
(FSRIA), as amended by the Food, Conservation, and Energy Act of 2008 
(FCEA), 7 U.S.C. 8102 (referred to in this document as ``section 
9002'').

II. Background

    As part of the BioPreferred Program, USDA published, on June 5, 
2012, a proposed rule in the Federal Register (FR) for the purpose of 
designating a total of 12 product categories for the preferred 
procurement of biobased products by Federal agencies (referred to 
hereafter in this FR notice as the ``preferred procurement program''). 
This proposed rule can be found at 77 FR 33270. This rulemaking is 
referred to in this preamble as Round 9 (RIN 0599-AA15).
    In the proposed rule, USDA proposed designating the following 12 
product categories for the preferred procurement program: Agricultural 
spray adjuvants; animal cleaning products; deodorants; dethatcher 
products; fuel conditioners; leather, vinyl, and rubber care products; 
lotions and moisturizers; shaving products; specialty precision 
cleaners and solvents; sun care products; wastewater systems coatings; 
and water clarifying agents.
    Today's final rule designates the proposed product categories 
within which biobased products will be afforded Federal procurement 
preference. USDA has determined that each of the product categories 
being designated under today's rulemaking meets the necessary statutory 
requirements; that they are being produced with biobased products; and 
that their procurement will carry out the following objectives of 
section 9002: to improve demand for biobased products; to spur 
development of the industrial base through value-added agricultural 
processing and manufacturing in rural communities; and to enhance the 
Nation's energy security by substituting biobased products for products 
derived from imported oil and natural gas.
    When USDA designates by rulemaking a product category (a generic 
grouping of products) for preferred procurement under the BioPreferred 
Program, manufacturers of all products under the umbrella of that 
product category, that meet the requirements to qualify for preferred 
procurement, can claim that status for their products. To qualify for 
preferred procurement, a product must be within a designated product 
category and must contain at least the minimum biobased content 
established for the designated item. With the designation of these 
specific product categories, USDA invites the manufacturers and vendors 
of qualifying products to provide information on the product, contacts, 
and performance testing for posting on its BioPreferred Web site, 
http://www.biopreferred.gov. Procuring agencies will be able to utilize 
this Web site as one tool to determine the availability of qualifying 
biobased products under a designated product category. Once USDA 
designates a product category, procuring agencies are required 
generally to purchase biobased products within the designated product 
category where the purchase price of the procurement product exceeds 
$10,000 or where the quantity of such products or of functionally 
equivalent products purchased over the preceding fiscal year equaled 
$10,000 or more.
    Subcategorization. USDA has not created subcategories for any of 
the product categories designated in today's action. However, USDA will 
continue to gather additional data related to the categories designated 
today and subcategories may be created in a future rulemaking.
    Minimum Biobased Contents. The minimum biobased contents being 
established with today's rulemaking are

[[Page 69382]]

based on products for which USDA has biobased content test data. 
Because the submission of product samples for biobased content testing 
is on a strictly voluntary basis, USDA was able to obtain samples only 
from those manufacturers who volunteered to invest the resources 
required to submit the samples. USDA has, however, begun to receive 
additional biobased content data associated with manufacturer's 
applications for certification to use the USDA Certified Biobased 
Product label. These test results are also considered when determining 
the minimum biobased content levels for designated product categories. 
In today's final rule, none of the minimum biobased contents are based 
on a single tested product. USDA will continue to gather information on 
the product categories designated today and if additional data on the 
biobased contents for products within these designated product 
categories are obtained, USDA will evaluate whether the minimum 
biobased content should be revised.
    Overlap with EPA's Comprehensive Procurement Guideline program for 
recovered content products under the Resource Conservation and Recovery 
Act (RCRA) Section 6002. USDA does not believe that any of the product 
categories being designated for Federal preferred procurement in 
today's rulemaking overlap with an EPA-designated recovered content 
product. However, interested readers may obtain more information on 
EPA's CPG products by accessing EPA's Web site http://www.epa.gov/epaoswer/non-hw/procure/products.htm and then clicking on the 
appropriate product name.
    Federal Government Purchase of Sustainable Products. The Federal 
government's sustainable purchasing program includes the following 
three statutory preference programs for designated products: the 
BioPreferred Program, the Environmental Protection Agency's 
Comprehensive Procurement Guideline for products containing recovered 
materials, and the Environmentally Preferable Purchasing program. The 
Office of the Federal Environmental Executive (OFEE) and the Office of 
Management and Budget (OMB) encourage agencies to implement these 
components comprehensively when purchasing products and services.
    Other Preferred Procurement Programs. Federal procurement officials 
should also note that biobased products may be available for purchase 
by Federal agencies through the AbilityOne Program (formerly known as 
the Javits-Wagner-O'Day (JWOD) program). Under this program, members of 
organizations including the National Industries for the Blind (NIB) and 
the National Institute for the Severely Handicapped (NISH) offer 
products and services for preferred procurement by Federal agencies. A 
search of the AbilityOne Program's online catalog (www.abilityone.gov) 
indicated that five of the product categories being designated today 
(deodorants; leather, vinyl, and rubber care products; lotions and 
moisturizers; specialty precision cleaners and solvents; and sun care 
products) are available through the AbilityOne Program. While there is 
no specific product within these product categories identified in the 
AbilityOne online catalog as being a biobased product, it is possible 
that such biobased products are available or will be available in the 
future. Also, because additional categories of products are frequently 
added to the AbilityOne Program, it is possible that biobased products 
within other product categories being designated today may be available 
through the AbilityOne Program in the future. Procurement of biobased 
products through the AbilityOne Program would further the objectives of 
both the AbilityOne Program and the preferred procurement program.
    Outreach. To augment its own research, USDA consults with industry 
and Federal stakeholders to the preferred procurement program during 
the development of the rulemaking packages for the designation of 
product categories. USDA requests stakeholder input in gathering 
information used in determining the order of product category 
designation and in identifying: Manufacturers producing and marketing 
products that fall within a product category proposed for designation; 
performance standards used by Federal agencies evaluating products to 
be procured; and warranty information used by manufacturers of end user 
equipment and other products with regard to biobased products.
    Future Designations. In making future designations, USDA will 
continue to conduct market searches to identify manufacturers of 
biobased products within product categories. USDA will then contact the 
identified manufacturers to solicit samples of their products for 
voluntary submission for biobased content testing. Based on these 
results, USDA will then propose new product categories for designation 
for preferred procurement.
    USDA has developed a preliminary list of product categories for 
future designation and has posted this preliminary list on the 
BioPreferred Web site. While this list presents an initial 
prioritization of product categories for designation, USDA cannot 
identify with certainty which product categories will be presented in 
each of the future rulemakings. In response to comments from other 
Federal agencies, USDA intends to give increased priority to those 
product categories that contain the highest biobased content. In 
addition, as the program matures, manufacturers of biobased products 
within some industry segments have become more responsive to USDA's 
requests for technical information than those in other segments. Thus, 
product categories with high biobased content and for which sufficient 
technical information can be obtained quickly may be added or moved up 
on the prioritization list.

III. Discussion of Public Comments

    USDA solicited comments on the proposed rule for 60 days ending on 
August 6, 2012. USDA received two comments by that date. One of the 
comments was from a company that provides consulting services in 
critical and industrial product cleaning and the other was from an 
individual citizen. The comments are presented below, along with USDA's 
responses, and are shown under the product categories to which they 
apply. After consideration of the comments, USDA is finalizing the 
designation of the 12 product categories within which biobased products 
will be afforded Federal procurement preference, as proposed.

Specialty Precision Cleaners and Solvents

    Comment: One commenter is opposed to the designation of the 
``specialty precision cleaners and solvents'' product category. The 
commenter provided their rationale for opposing the designation of the 
product category under six headings, which are presented below.
    1. Public Safety Concerns. The commenter stated that there are 
likely to be widespread performance issues related to the cleaning of 
many high-value products or where the consequences of inadequate 
cleaning and residual contamination are dire. The commenter gave as an 
example the cleaning of single use and reusable medical devices where 
leachable residue from cleaning agents is unacceptable, and may be 
dangerous for the patient.
    2. Unestablished Performance, Need for Product Development. The 
commenter stated that the suitability of a cleaning agent for a given 
application includes many parameters (wettability, boiling point, 
rinseability, residue, compatibility with materials of construction, 
purity of biobased

[[Page 69383]]

ingredients) and that the selection of a particular cleaning agent is 
application-specific. Because of their role in evaluating and advising 
clients on the many biobased products offered for sale, the commenter 
stated that they have actively and repeatedly sought out other 
contributors on the subject and have been unable to obtain definitive, 
scientific contributions. Based on the lack of scientific information, 
the commenter believes that biobased products for precision cleaning 
require further development.
    3. Conflict With Other Regulations. The commenter stated that the 
proposed requirement is in conflict with Federal, State, and regional 
mandates to improve air quality. The commenter explained that most of 
the biobased cleaning products would be subject to VOC regulations and 
restrictions. The commenter also stated that the definition of 
precision cleaners is not in harmony with that used for precision 
cleaners by the EPA Significant New Alternative Policy (SNAP) program. 
The commenter stated that the USDA definition seems to cross over the 
SNAP categories that include metals, electronics, and precision 
cleaning.
    4. Costs to Industry and Government. The commenter stated that 
requiring or favoring biobased precision cleaners will put an undue 
burden on industry and is detrimental to U.S. economic recovery. The 
commenter further stated that adopting a new cleaning agent requires 
extensive testing, obtaining new cleaning equipment, and training of 
employees. According to the commenter, these activities involve high 
capital and ongoing costs as well as significant engineering effort. 
The commenter stated that the effort and costs of demonstrating 
efficacy of cleaning and lack of compatibility issues should be 
spearheaded by the producers and suppliers of biobased products. The 
commenter also stated that regulatory costs, such as in-use control of 
VOCs and the costs of waste management, can be prohibitive.
    5. Comments, Process for Industry Investigation. The commenter 
stated that the background documentation on the BioPreferred Web site 
for this category is very difficult to find and contains numerous 
inaccuracies. The commenter believes that many of the products listed 
are not biobased products and many are intended for household or 
consumer use or for janitorial use. The commenter further stated that 
these products are not recommended for precision cleaning because of 
the presence of fragrance and lotions, the lack of product support for 
precision applications, and the potential for unexpected and 
undisclosed formulation changes.
    6. Potential for Development. The commenter stated that biobased 
precision cleaners or cleaning agents for clinical cleaning could be 
developed. However, according to the commenter, it would be 
counterproductive to place the burden of such development on 
manufacturers of products and components who do hard-surface cleaning. 
The commenter stated that until such products have been developed and 
until cleaning efficacy and product safety has been demonstrated, their 
use should not be required.
    Response: USDA agrees with the commenter's general position that 
biobased specialty precision cleaners and solvents have not been 
demonstrated to meet every performance need that may be encountered in 
precision cleaning operations. USDA recognizes that specialty precision 
cleaners and solvents is a product category with wide-ranging 
performance demands, depending on the type and end use of the product 
or surface on which the cleaner is being used. The commenter mentions 
single use and reusable medical devices as examples of applications 
where, according to the commenter, biobased specialty precision 
cleaners may not meet performance requirements. USDA points out that 
the intent of designating biobased specialty precision cleaners and 
solvents for Federal procurement preference is not to eliminate the use 
of traditional cleaners in cases such as those mentioned by the 
commenter. The intent of the designation is, rather, to require that 
Federal agencies give preference to biobased specialty precision 
cleaners and solvents in those cases where such biobased products meet 
the agency's performance requirements as well as availability and cost 
considerations. Federal agencies are not required to purchase and use 
biobased products if the available products are not capable of meeting 
reasonable performance expectations or are not priced competitively 
with non-biobased products. Section 9002 is very specific regarding 
these exceptions. However, USDA encourages Federal agencies to explore 
available biobased products and communicate with biobased product 
manufacturers regarding performance and cost issues. Reputable biobased 
product manufacturers should be willing to work with Federal agencies 
to resolve issues and they should also recognize that, even with the 
Federal procurement preference, they will not be successful if their 
products do not perform up to expectations.
    USDA recognizes that performance is the key factor in making 
purchasing decisions among the various types of products within most 
product categories. However, USDA believes that many situations exist 
where biobased specialty precision cleaners and solvents may perform as 
well as, or better, than the more traditional petroleum based cleaners 
and solvents. Thus, USDA believes that the designation of biobased 
specialty precision cleaners and solvents is consistent with the goals 
and objectives of the BioPreferred program and has finalized the 
designation in today's rulemaking.
    With regard to the commenter's statements about potential conflicts 
with EPA VOC rules, USDA has not attempted to address other regulatory 
requirements for the manufacture or use of biobased products that are 
alternatives for petroleum based products. Manufacturers and users of 
biobased alternative products must still be aware of, and comply with, 
applicable regulations related to environmental, safety, and health 
concerns. USDA statutory authority for the BioPreferred program allows 
only the consideration of biobased content, not such factors as ozone 
depletion, flammability, or exposure limits. Manufacturers of specialty 
precision cleaners and solvents, or any other biobased product, must 
address such issues with the agencies having the proper jurisdiction.
    USDA agrees with the commenter's position that the primary costs of 
demonstrating efficacy of cleaning and lack of compatibility issues 
should be borne by the producers and suppliers of the biobased 
products. However, USDA believes that the statutory authority for the 
BioPreferred program addresses this issue. As discussed above, Section 
9002 is very specific that Federal agencies are not required to 
purchase and use biobased products if the available products are not 
capable of meeting reasonable performance expectations or are not 
priced competitively with non-biobased products. Thus, the burden to 
demonstrate to Federal purchasing agents that biobased products are 
competitive in terms of performance and cost is on the producers and 
suppliers of the biobased products.
    USDA appreciates the commenter's statements concerning the 
background documentation provided on the BioPreferred Web site. USDA 
points out that the goal of the ``industry investigation'' is not 
necessarily to create a definitive list of biobased

[[Page 69384]]

products and their manufacturers, but to confirm that a sufficient 
number of biobased products are available to support the designation of 
the product category. To identify available biobased products, USDA 
often searches for (and lists) all products within a product category, 
including those that are made from petroleum based ingredients. Also, 
in performing the background searches to document the availability of 
biobased products within a product category, USDA often uses search 
terms that may return products with names or functions that sound 
similar to the products being investigated but that are actually very 
different.
    After the initial list of products is generated, USDA focuses on 
gathering specific information from the manufacturers of products that 
are found to be biobased products that potentially support the 
designation of the product category. Thus, while USDA acknowledges that 
the ``industry investigation'' results can be somewhat misleading, USDA 
believes that the information used to support the final decision to 
designate the product category is clearly provided in other background 
files. For example, the ``item designation report'' includes biobased 
content information and the BEES analysis results and the ``item 
summary'' lists those products for which USDA obtained product 
information from the manufacturers.
    In response to the commenter's statement that the background 
documentation was hard to locate, USDA will consider possible 
clarifying revisions to the structure or the headings of the 
information posted on the BioPreferred Web site.

Water Clarifying Agents

    Comment: One commenter stated that carbon and other biobased media 
should be considered as part of the water clarifying agents category. 
The commenter stated that any of these biobased media require 
consideration for the BioPreferred status, because of the fact that 
these are the most capable to achieve the desired end result--treated 
water.
    Response: The primary criteria that must be met by products to 
qualify for the procurement preference under the BioPreferred program 
is the minimum biobased content established for the product category 
into which the products fall. Products within the water clarifying 
agents product category must have a minimum biobased content of at 
least 92 percent, based on the amount of qualifying biobased carbon in 
the product as a percent of the weight (mass) of the total organic 
carbon in the finished product. The biobased content must be 
demonstrated by testing using ASTM D6866.\1\ Thus, if the water 
clarifying agents mentioned by the commenter meet the minimum biobased 
content criteria, they would qualify for preferred procurement under 
the BioPreferred program.
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    \1\ ASTM D6866, ``Standard Test Methods for Determining the 
Biobased Content of Solid, Liquid, and Gaseous Samples Using 
Radiocarbon Analysis,'' is used to distinguish between carbon from 
fossil resources (non-biobased carbon) and carbon from renewable 
sources (biobased carbon). The biobased content is expressed as the 
percentage of total carbon that is biobased carbon.
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IV. Regulatory Information

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    Executive Order 12866, as supplemented by Executive Order 13563, 
requires agencies to determine whether a regulatory action is 
``significant.'' The Order defines a ``significant regulatory action'' 
as one that is likely to result in a rule that may: ``(1) Have an 
annual effect on the economy of $100 million or more or adversely 
affect, in a material way, the economy, a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or State, local, or tribal governments or communities; (2) 
Create a serious inconsistency or otherwise interfere with an action 
taken or planned by another agency; (3) Materially alter the budgetary 
impact of entitlements, grants, user fees, or loan programs or the 
rights and obligations of recipients thereof; or (4) Raise novel legal 
or policy issues arising out of legal mandates, the President's 
priorities, or the principles set forth in this Executive Order.''
    Today's final rule has been determined by the Office of Management 
and Budget to be not significant for purposes of Executive Order 12866. 
We are not able to quantify the annual economic effect associated with 
today's final rule. As discussed in the preamble to the proposed 
rulemaking, USDA made extensive efforts to obtain information on the 
Federal agencies' usage within the 12 designated product categories, 
including their subcategories. These efforts were largely unsuccessful. 
Therefore, attempts to determine the economic impacts of today's final 
rule would require estimation of the anticipated market penetration of 
biobased products based upon many assumptions. In addition, because 
agencies have the option of not purchasing biobased products within 
designated product categories if price is ``unreasonable,'' the product 
is not readily available, or the product does not demonstrate necessary 
performance characteristics, certain assumptions may not be valid. 
While facing these quantitative challenges, USDA relied upon a 
qualitative assessment to determine the impacts of today's final rule. 
Consideration was also given to the fact that agencies may choose not 
to procure designated items due to unreasonable price.
1. Summary of Impacts
    Today's final rule is expected to have both positive and negative 
impacts to individual businesses, including small businesses. USDA 
anticipates that the biobased preferred procurement program will 
provide additional opportunities for businesses and manufacturers to 
begin supplying products under the designated biobased product 
categories to Federal agencies and their contractors. However, other 
businesses and manufacturers that supply only non-qualifying products 
and do not offer biobased alternatives may experience a decrease in 
demand from Federal agencies and their contractors. USDA is unable to 
determine the number of businesses, including small businesses, that 
may be adversely affected by today's final rule. The final rule, 
however, will not affect existing purchase orders, nor will it preclude 
businesses from modifying their product lines to meet new requirements 
for designated biobased products. Because the extent to which procuring 
agencies will find the performance, availability and/or price of 
biobased products acceptable is unknown, it is impossible to quantify 
the actual economic effect of the rule.
2. Benefits of the Final Rule
    The designation of these 12 product categories provides the 
benefits outlined in the objectives of section 9002; to increase 
domestic demand for many agricultural commodities that can serve as 
feedstocks for production of biobased products, and to spur development 
of the industrial base through value-added agricultural processing and 
manufacturing in rural communities. On a national and regional level, 
today's final rule can result in expanding and strengthening markets 
for biobased materials used in these product categories.
3. Costs of the Final Rule
    Like the benefits, the costs of today's final rule have not been 
quantified. Two types of costs are involved: Costs to producers of 
products that will compete with the preferred products and costs to

[[Page 69385]]

Federal agencies to provide procurement preference for the preferred 
products. Producers of competing products may face a decrease in demand 
for their products to the extent Federal agencies refrain from 
purchasing their products. However, it is not known to what extent this 
may occur. Pre-award procurement costs for Federal agencies may rise 
minimally as the contracting officials conduct market research to 
evaluate the performance, availability and price reasonableness of 
preferred products before making a purchase.

B. Regulatory Flexibility Act (RFA)

    The RFA, 5 U.S.C. 601-602, generally requires an agency to prepare 
a regulatory flexibility analysis of any rule subject to notice and 
comment rulemaking requirements under the Administrative Procedure Act 
or any other statute unless the agency certifies that the rule will not 
have a significant economic impact on a substantial number of small 
entities. Small entities include small businesses, small organizations, 
and small governmental jurisdictions.
    USDA evaluated the potential impacts of its designation of these 
product categories to determine whether its actions would have a 
significant impact on a substantial number of small entities. Because 
the preferred procurement program established under section 9002 
applies only to Federal agencies and their contractors, small 
governmental (city, county, etc.) agencies are not affected. Thus, the 
proposal, if promulgated, will not have a significant economic impact 
on small governmental jurisdictions.
    USDA anticipates that this program will affect entities, both large 
and small, that manufacture or sell biobased products. For example, the 
designation of product categories for preferred procurement will 
provide additional opportunities for businesses to manufacture and sell 
biobased products to Federal agencies and their contractors. Similar 
opportunities will be provided for entities that supply biobased 
materials to manufacturers.
    The intent of section 9002 is largely to stimulate the production 
of new biobased products and to energize emerging markets for those 
products. Because the program is still in its infancy, however, it is 
unknown how many businesses will ultimately be affected. While USDA has 
no data on the number of small businesses that may choose to develop 
and market biobased products within the product categories designated 
by this rulemaking, the number is expected to be small. Because 
biobased products represent a small emerging market, only a small 
percentage of all manufacturers, large or small, are expected to 
develop and market biobased products. Thus, the number of small 
businesses manufacturing biobased products affected by this rulemaking 
is not expected to be substantial.
    The preferred procurement program may decrease opportunities for 
businesses that manufacture or sell non-biobased products or provide 
components for the manufacturing of such products. Most manufacturers 
of non-biobased products within the product categories being proposed 
for designation for Federal preferred procurement in this rule are 
expected to be included under the following NAICS codes: 325320 
(pesticide and other agricultural chemicals manufacturing), 325411 
(medicinal and botanical manufacturing), 325412 (pharmaceutical 
preparation manufacturing), 325510 (paint and coating manufacturing), 
325612 (polish and other sanitation goods manufacturing), and 325620 
(toilet preparation manufacturing). USDA obtained information on these 
six NAICS categories from the U.S. Census Bureau's Economic Census 
database. USDA found that the Economic Census reports about 3,756 
companies within these 6 NAICS categories and that these companies own 
a total of about 4,374 establishments. Thus, the average number of 
establishments per company is about 1.2. The Census data also reported 
that of the 4,374 individual establishments, about 4,258 (97.3 percent) 
have fewer than 500 employees. USDA also found that the overall average 
number of employees per company among these industries is about 92 and 
that the pharmaceutical preparation manufacturing segment (with an 
average of about 250) is the only segment reporting an average of more 
than 100 employees per company. Thus, nearly all of the businesses fall 
within the Small Business Administration's definition of a small 
business (less than 500 employees, in most NAICS categories).
    USDA does not have data on the potential adverse impacts on 
manufacturers of non-biobased products within the product categories 
being designated, but believes that the impact will not be significant. 
Most of the product categories being designated in this rulemaking are 
typical consumer products widely used by the general public and by 
industrial/commercial establishments that are not subject to this 
rulemaking. Thus, USDA believes that the number of small businesses 
manufacturing non-biobased products within the product categories being 
designated and selling significant quantities of those products to 
government agencies affected by this rulemaking to be relatively low. 
Also, this final rule will not affect existing purchase orders and it 
will not preclude procuring agencies from continuing to purchase non-
biobased products when biobased products do not meet the availability, 
performance, or reasonable price criteria. This final rule will also 
not preclude businesses from modifying their product lines to meet new 
specifications or solicitation requirements for these products 
containing biobased materials.
    After considering the economic impacts of this final rule on small 
entities, USDA certifies that this action will not have a significant 
economic impact on a substantial number of small entities.
    While not a factor relevant to determining whether the final rule 
will have a significant impact for RFA purposes, USDA has concluded 
that the effect of the rule will be to provide positive opportunities 
to businesses engaged in the manufacture of these biobased products. 
Purchase and use of these biobased products by procuring agencies 
increase demand for these products and result in private sector 
development of new technologies, creating business and employment 
opportunities that enhance local, regional, and national economies.

C. Executive Order 12630: Governmental Actions and Interference With 
Constitutionally Protected Property Rights

    This final rule has been reviewed in accordance with Executive 
Order 12630, Governmental Actions and Interference with 
Constitutionally Protected Property Rights, and does not contain 
policies that would have implications for these rights.

D. Executive Order 12988: Civil Justice Reform

    This final rule has been reviewed in accordance with Executive 
Order 12988, Civil Justice Reform. This rule does not preempt State or 
local laws, is not intended to have retroactive effect, and does not 
involve administrative appeals.

E. Executive Order 13132: Federalism

    This final rule does not have sufficient federalism implications to 
warrant the preparation of a Federalism Assessment. Provisions of this 
final rule will not have a substantial direct effect on States or their 
political subdivisions or on the distribution of power and

[[Page 69386]]

responsibilities among the various government levels.

F. Unfunded Mandates Reform Act of 1995

    This final rule contains no Federal mandates under the regulatory 
provisions of Title II of the Unfunded Mandates Reform Act of 1995 
(UMRA), 2 U.S.C. 1531-1538, for State, local, and tribal governments, 
or the private sector. Therefore, a statement under section 202 of UMRA 
is not required.

G. Executive Order 12372: Intergovernmental Review of Federal Programs

    For the reasons set forth in the Final Rule Related Notice for 7 
CFR part 3015, subpart V (48 FR 29115, June 24, 1983), this program is 
excluded from the scope of Executive Order 12372, which requires 
intergovernmental consultation with State and local officials. This 
program does not directly affect State and local governments.

H. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    Today's final rule does not significantly or uniquely affect ``one 
or more Indian tribes,* * * the relationship between the Federal 
Government and Indian tribes, or * * * the distribution of power and 
responsibilities between the Federal Government and Indian tribes.'' 
Thus, no further action is required under Executive Order 13175.

I. Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501 through 3520), the information collection under this final rule is 
currently approved under OMB control number 0503-0011.

J. E-Government Act Compliance

    USDA is committed to compliance with the E-Government Act, which 
requires Government agencies, in general, to provide the public the 
option of submitting information or transacting business electronically 
to the maximum extent possible. USDA is implementing an electronic 
information system for posting information voluntarily submitted by 
manufacturers or vendors on the products they intend to offer for 
preferred procurement under each designated product category. For 
information pertinent to E-Government Act compliance related to this 
rule, please contact Ron Buckhalt at (202) 205-4008.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, that includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. USDA has submitted a report containing this rule and 
other required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register.

List of Subjects in 7 CFR Part 3201

    Biobased products, Procurement.

    For the reasons stated in the preamble, the Department of 
Agriculture is amending 7 CFR chapter XXXII as follows:

CHAPTER XXXII--OFFICE OF PROCUREMENT AND PROPERTY MANAGEMENT

PART 3201--GUIDELINES FOR DESIGNATING BIOBASED PRODUCTS FOR FEDERAL 
PROCUREMENT

0
1. The authority citation for part 3201 continues to read as follows:

    Authority:  7 U.S.C. 8102.


0
2. Add Sec. Sec.  3201.88 through 3201.99 to subpart B to read as 
follows:

Sec.
3201.88 Agricultural spray adjuvants.
3201.89 Animal cleaning products.
3201.90 Deodorants.
3201.91 Dethatcher products.
3201.92 Fuel conditioners.
3201.93 Leather, vinyl, and rubber care products.
3201.94 Lotions and moisturizers.
3201.95 Shaving products.
3201.96 Specialty precision cleaners and solvents.
3201.97 Sun care products.
3201.98 Wastewater systems coatings.
3201.99 Water clarifying agents.


Sec.  3201.88  Agricultural spray adjuvants.

    (a) Definition. Products mixed in the spray tank with the 
herbicide, pesticide, or fertilizer formulas that will improve the 
efficiency and the effectiveness of the chemicals, including sticking 
agents, wetting agents, etc.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 50 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased agricultural spray 
adjuvants. By that date, Federal agencies that have the responsibility 
for drafting or reviewing specifications for products to be procured 
shall ensure that the relevant specifications require the use of 
biobased agricultural spray adjuvants.


Sec.  3201.89  Animal cleaning products.

    (a) Definition. Products designed to clean, condition, or remove 
substances from animal hair or other parts of an animal.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 57 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased animal cleaning 
products. By that date, Federal agencies that have the responsibility 
for drafting or reviewing specifications for products to be procured 
shall ensure that the relevant specifications require the use of 
biobased animal cleaning products.


Sec.  3201.90  Deodorants.

    (a) Definition. Products that are designed for inhibiting or 
masking perspiration and other body odors and that are often combined 
with an antiperspirant.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 73 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased deodorants. By that 
date, Federal agencies that have the responsibility for drafting or 
reviewing specifications for products to be procured shall ensure that 
the relevant specifications require the use of biobased deodorants.


Sec.  3201.91  Dethatchers.

    (a) Definition. Products used to remove non-decomposed plant 
material accumulated in grassy areas.
    (b) Minimum biobased content. The Federal preferred procurement 
product

[[Page 69387]]

must have a minimum biobased content of at least 87 percent, which 
shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased dethatchers. By that 
date, Federal agencies that have the responsibility for drafting or 
reviewing specifications for products to be procured shall ensure that 
the relevant specifications require the use of biobased dethatchers.


Sec.  3201.92  Fuel conditioners.

    (a) Definition. Products formulated to improve the performance and 
efficiency of engines by providing benefits such as removing 
accumulated deposits, increasing lubricity, removing moisture, 
increasing the cetane number, and/or preventing microbial growths 
within the fuel system.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 64 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased fuel conditioners. By 
that date, Federal agencies that have the responsibility for drafting 
or reviewing specifications for products to be procured shall ensure 
that the relevant specifications require the use of biobased fuel 
conditioners.


Sec.  3201.93  Leather, vinyl, and rubber care products.

    (a) Definition. Products that help clean, nourish, protect, and 
restore leather, vinyl, and rubber surfaces, including cleaners, 
conditioners, protectants, polishes, waxes, etc.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 55 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased leather, vinyl, and 
rubber care products. By that date, Federal agencies that have the 
responsibility for drafting or reviewing specifications for products to 
be procured shall ensure that the relevant specifications require the 
use of biobased leather, vinyl, and rubber care products.


Sec.  3201.94  Lotions and moisturizers.

    (a) Definition. Creams and oils used to soften and treat damaged 
skin.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 59 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased lotions and 
moisturizers. By that date, Federal agencies that have the 
responsibility for drafting or reviewing specifications for products to 
be procured shall ensure that the relevant specifications require the 
use of biobased lotions and moisturizers.


Sec.  3201.95  Shaving products.

    (a) Definition. Products designed for every step of the shaving 
process, including shaving creams, gels, soaps, lotions, and aftershave 
balms.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 92 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased shaving products. By 
that date, Federal agencies that have the responsibility for drafting 
or reviewing specifications for products to be procured shall ensure 
that the relevant specifications require the use of biobased shaving 
products.


Sec.  3201.96  Specialty precision cleaners and solvents.

    (a) Definition. Cleaners and solvents used in specialty 
applications. These materials may be used in neat solution, diluted 
with water, or in hand wiping applications.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 56 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased specialty precision 
cleaners and solvents. By that date, Federal agencies that have the 
responsibility for drafting or reviewing specifications for products to 
be procured shall ensure that the relevant specifications require the 
use of biobased specialty precision cleaners and solvents.


Sec.  3201.97  Sun care products.

    (a) Definition. Products including sunscreens, sun blocks, and 
suntan lotions that are topical products that absorb or reflect the 
sun's ultraviolet radiation to protect the skin.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 53 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased sun care products. By 
that date, Federal agencies that have the responsibility for drafting 
or reviewing specifications for products to be procured shall ensure 
that the relevant specifications require the use of biobased sun care 
products.


Sec.  3201.98  Wastewater systems coatings.

    (a) Definition. Coatings that protect wastewater containment tanks, 
liners, roofing, flooring, joint caulking, manholes and related 
structures from corrosion. Protective coatings may cover the entire 
system or be used to fill cracks in systems.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 47 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased wastewater systems 
coatings. By that date, Federal agencies that have the responsibility 
for drafting or reviewing specifications for products to be procured 
shall ensure that the relevant specifications require the use of 
biobased wastewater systems coatings.

[[Page 69388]]

Sec.  3201.99  Water clarifying agents.

    (a) Definition. Products designed to clarify and improve the 
quality of water by reducing contaminants such as excess nitrites, 
nitrates, phosphates, ammonia, and built-up sludge from decaying waste 
and other organic matter.
    (b) Minimum biobased content. The Federal preferred procurement 
product must have a minimum biobased content of at least 92 percent, 
which shall be based on the amount of qualifying biobased carbon in the 
product as a percent of the weight (mass) of the total organic carbon 
in the finished product.
    (c) Preference compliance date. No later than November 19, 2013, 
procuring agencies, in accordance with this part, will give a 
procurement preference for qualifying biobased water clarifying agents. 
By that date, Federal agencies that have the responsibility for 
drafting or reviewing specifications for products to be procured shall 
ensure that the relevant specifications require the use of biobased 
water clarifying agents.

    Dated: November 9, 2012.
Gregory L. Parham,
Acting Assistant Secretary for Administration, U.S. Department of 
Agriculture.
[FR Doc. 2012-28045 Filed 11-16-12; 8:45 am]
BILLING CODE 3410-93-P