[Federal Register Volume 81, Number 80 (Tuesday, April 26, 2016)]
[Rules and Regulations]
[Pages 24456-24459]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-09620]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 925 and 944

[Doc. No. AMS-FV-14-0100; FV15-925-1 FR]


Grapes Grown in a Designated Area of Southeastern California and 
Imported Table Grapes; Revision to the Administrative Rules and 
Regulations for Shipments to Charitable Organizations

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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

SUMMARY: This rule implements a recommendation from the California 
Desert Grape Administrative Committee (Committee) to revise the 
administrative rules and regulations of the Federal marketing order for 
grapes grown in a designated area of southeastern California (order) 
and the table grape import regulation. The Committee locally 
administers the order and is comprised of producers and handlers of 
grapes grown in the production area. This rule allows handlers and 
importers to ship grapes that do not meet the minimum grade and size 
quality requirements to be donated to charitable organizations. Any 
such grapes shall not be used for resale. The import regulation is 
authorized under section 608e of the Agricultural Marketing Agreement 
Act of 1937 and regulates the importation of table grapes into the 
United States. This final rule provides an additional outlet for grapes 
regulated under the order and assists USDA's efforts to reduce food 
waste in support of the U.S. Food Waste Challenge.

DATES: Effective May 26, 2016.

FOR FURTHER INFORMATION CONTACT: Kathie Notoro, Marketing Specialist, 
or Jeffrey Smutny, Regional Director, California Marketing Field 
Office, Marketing Order and Agreement Division, Specialty Crops 
Program, AMS, USDA, 1400 Independence Avenue SW., Stop 0237, 
Washington, DC 20250-0237; Telephone: (202) 720-2491, Fax: (202) 720-
8938, or Email: [email protected] or 
[email protected].
    Small businesses may request information on complying with this 
regulation by contacting Antoinette Carter, Marketing Order and 
Agreement Division, Specialty Crops Program, AMS, USDA, 1400 
Independence Avenue SW., STOP 0237, Washington, DC 20250-0237; 
Telephone: (202) 720-2491, Fax: (202) 720-8938, or Email: 
[email protected].

SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing 
Order No. 925 (7 CFR part 925), regulating the handling of table grapes 
grown in a designated area of southeastern California, 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.''
    This final rule is also issued under section 608e (8e) of the Act, 
which provides that whenever certain specified commodities, including 
table grapes, are regulated under a Federal marketing order, imports of 
these commodities into the United States are prohibited unless they 
meet the same or comparable grade, size, quality, or maturity 
requirements as those in effect for the domestically produced 
commodities.
    The Department of Agriculture (USDA) is issuing this rule in 
conformance with Executive Orders 12866, 13563, and 13175.
    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is not intended to have retroactive 
effect.
    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.
    There are no administrative procedures which must be exhausted 
prior to any judicial challenge to the provisions of import regulations 
issued under section 8e of the Act.
    This final rule revises the order's administrative rules and 
regulations and the import regulations to allow handlers and importers 
to ship grapes that do not meet the minimum grade and size quality 
requirements to be donated to charitable organizations. Any such grapes 
shall not be used for resale. This action provides an additional outlet 
for grapes regulated under the order and supports USDA's efforts to 
reduce food waste under the U.S. Food Waste Challenge. The change in 
the import regulation is required under section 8e of the Act. These 
actions were unanimously recommended by the Committee following 
deliberations at a public meeting held on November 5, 2013, and a 
required new Food Donation Form (CDGAC Form No. 8) was subsequently 
approved at a meeting held on October 30, 2014.
    Section 925.54 of the order provides that regulations in effect 
pursuant to Sec.  925.41, Sec.  925.52, or Sec.  925.55 may be 
modified, suspended, or terminated to facilitate handling of grapes for 
purposes which may be recommended by the Committee and approved by the 
Secretary, and that rules, regulations, and safeguards shall be 
prescribed to prevent grapes handled under the provisions of this 
section from entering the channels of trade for other than the specific 
purposes authorized by this section.
    This final rule amends Sec.  925.304 of the administrative rules 
and regulations to provide an outlet for grapes failing to meet 
inspection and quality requirements. The final rule allows handlers to 
donate such grapes to charitable organizations. Any such grapes may not 
be used for resale.
    Accordingly, to prohibit such donated grapes from being sold, and 
to prevent other unauthorized distribution of such shipments, the 
Committee developed CDGAC Form No. 8 to track the shipment of these 
grapes and verify their receipt by the intended charitable 
organization.

[[Page 24457]]

    Section 925.60 of the order provides authority for the Committee, 
with the approval of USDA, to require handlers to furnish reports and 
information to the Committee as needed to enable the Committee to 
perform its duties under the order. This rule revises Sec.  925.160(c) 
of the order's administrative rules and regulations. It requires 
handlers donating grapes to a charitable organization to ensure CDGAC 
Form No. 8 is completed, signed, and furnished to the Committee within 
two days of receipt by the intended charity.
    These actions were unanimously recommended by the Committee 
following deliberations at a public meeting held on November 5, 2013, 
and the new form was subsequently approved at a meeting held on October 
30, 2014. This action provides handlers and importers with an outlet 
for grapes that do not meet minimum quality requirements and supports 
the U.S. Secretary of Agriculture's initiative to reduce, recover, and 
recycle food in conjunction with the U.S. Food Waste Challenge.
    Under section 8e of the Act, minimum grade, size, quality, and 
maturity requirements for table grapes imported into the United States 
are established under Table Grape Import Regulation 4 (7 CFR 944.503) 
(import regulation), and safeguard procedures for certain commodities 
exempt from these requirements are established under Sec.  944.350. A 
change in the California Desert Grape Regulation 6, Sec.  925.304, that 
allows table grapes to be donated to charitable organizations requires 
a corresponding change to the requirements for imported table grapes. 
Similar to the domestic industry, this action allows importers to 
donate table grapes to charitable organizations. Sections 944.350(a)(1) 
and 944.503(d) and (e) are revised accordingly.

Final Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), 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 
businesses 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 13 handlers of southeastern California 
table grapes who are subject to regulation under the marketing order 
and approximately 41 grape producers in the production area. In 
addition, there are about 135 importers of grapes. Small agricultural 
service firms are defined by the Small Business Administration (SBA) as 
those having annual receipts of less than $7,500,000, and small 
agricultural producers are defined as those having annual receipts of 
less than $750,000 (13 CFR 121.201).
    Ten of the 13 handlers subject to regulation have annual grape 
sales of less than $7,500,000 according to USDA Market News Service and 
Committee data. Based on information from the Committee and USDA's 
Market News Service, it is estimated that at least 10 of the 41 
producers have annual receipts of less than $750,000. Thus, it may be 
concluded that a majority of grape handlers regulated under the order 
and about 10 of the producers could be classified as small entities 
under the SBA definitions.
    Mexico, Chile, and Peru are the major countries that export table 
grapes to the United States. According to 2015 U.S. Census Bureau Trade 
Data, shipments of table grapes imported into the United States from 
Mexico totaled 18,004,062 18-pound lugs, from Chile totaled 41,974,714 
18-pound lugs, and from Peru totaled 4,829,483 18-pound lugs. According 
to USDA's Foreign Agricultural Service data, the total value of table 
grapes imported into the United States in 2015 was $1,220,169,475. It 
is estimated that the average importer received $9.0 million in revenue 
from the sale of table grapes in 2015. Based on this information, it 
may be concluded that the average table grape importer is not 
classified as a small entity.
    This final rule revises Sec.  925.160 of the administrative rules 
and regulations under the order to require handlers to report to the 
Committee any grapes donated to charitable organizations. It also 
revises Sec.  925.304 of the order's administrative rules and 
regulations to allow grapes that do not meet minimum quality 
requirements, yet are still desirable for human consumption, to be 
donated to charitable organizations. These changes allow the industry 
to participate in the U.S. Food Waste Challenge while ensuring that 
donated grapes are only distributed as authorized. Authority for 
permitting Special Purchase Shipments is provided in Sec.  925.54. The 
requirement for handlers to report this information to the Committee is 
provided in Sec.  925.60 of the order.
    The Committee's proposal to authorize donation of grapes to 
charitable organizations was unanimously recommended at a public 
meeting on November 5, 2013. The Committee presented the Food Donation 
Form CDGAC No. 8 at its meeting on October 30, 2014, and subsequently 
submitted it to AMS for further approval. There is no direct financial 
effect on producers or handlers. Authority for the change to the table 
grape import regulation is provided in section 8e of the Act.
    The Committee believes this change is beneficial to the industry 
and to the recipients of this donated food product. Very little impact 
is expected because the change in the regulatory requirements on 
handlers is minimal. There is one new form added to track and ensure 
that grapes not meeting the minimum grade and size requirements are 
donated to a charitable organization and not used for resale. This 
change does not contain any assessment or funding implications. There 
is no change in financial costs.
    Alternatives to the proposal, including making no changes at this 
time, were considered. However, the Committee believes it is beneficial 
to allow these grapes to be donated to charitable organizations to 
reduce, recover, and recycle edible food product in support of the U.S. 
Food Waste Challenge.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Chapter 35), the order's information collection requirements have been 
previously approved by the Office of Management and Budget (OMB) and 
assigned OMB No. 0581-0189, Generic OMB Fruit Crops. However, as a 
result of this action, CDGAC Form No. 8 has been submitted to OMB for 
approval and temporarily assigned OMB No. 0581-0290.
    This action imposes minimal additional reporting and recordkeeping 
burden on domestic handlers who elect to donate grapes to charitable 
organizations using the CDGAC Form No. 8. It is estimated that the 
annual reporting burden for the industry will increase by 2.34 hours. 
All 14 handlers are in support of using this form to document the 
delivery of grapes to charitable organizations.
    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 24458]]

    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. Further, public comments received 
concerning the proposal did not address the initial regulatory 
flexibility analysis.
    Under section 8e, whenever certain specified commodities are 
regulated under a Federal marketing order, imports of that commodity 
must meet the same or comparable grade, size, quality, and maturity 
requirements as those in effect for the domestic commodity. Grapes are 
included under section 8e, and thus importers of table grapes are 
required to have such grapes inspected. A change that allows certain 
domestic table grapes to be donated to charitable organizations 
requires corresponding changes to the requirements for imported table 
grapes.
    Importers already complete the Importer's Exempt Commodity Form 
(FV-6), which provides for certain authorized imported commodities to 
be diverted to alternative channels such as processing, animal feed, 
and charities. With this change, Sec. Sec.  944.350(a)(1) and 
944.503(d) and (e) are revised to allow for imported grapes to be 
donated for consumption by charitable organizations. This action does 
not change the format of the FV-6 form nor does it affect the burden. 
It is unlikely to impose additional reporting and recordkeeping burden 
on importers who elect to donate grapes to charitable organizations. 
Importers are not required to complete the CDGAC Form No. 8. CDGAC Form 
No. 8 is only intended to cover deliveries of domestically produced 
grapes to charitable organizations by domestic grape handlers.
    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.
    The Committee's meetings were widely publicized throughout the 
California table grape production area. All interested persons were 
invited to attend both meetings and encouraged to participate in 
Committee deliberations. Like all Committee meetings, the November 5, 
2013, and the October 30, 2014, meetings were public, and all entities, 
both large and small, were encouraged to express their views on this 
issue.
    A proposed rule concerning this action was published in the Federal 
Register on October 1, 2015 (80 FR 59077). Copies of the rule were 
mailed or sent via email to all Committee members and grape handlers. 
The rule was made available through the internet by USDA and the Office 
of the Federal Register. A 60-day comment period ending November 30, 
2015, was provided to allow interested persons to respond to the 
proposal.
    Two comments were received during the comment period in favor of 
the proposal. One comment simply stated that the commenter liked the 
proposal. The other commenter was also in favor of the proposal and 
recommended that the donated grapes be ``rechecked'' by the receiving 
charitable organization to ensure edibility. Table grapes that do not 
meet minimum grade and size requirements can still be wholesome and 
safe to eat. The regulations contain safeguards to ensure that table 
grapes donated to charitable organizations are accepted by those 
organizations for their intended use (food distribution) through the 
use of the new CDGAC Form No. 8 (for domestic grapes) and Form FV-6 
(for imported grapes). The Committee and USDA believe this change helps 
reduce food waste by providing an outlet for wholesome and edible table 
grapes. No comments were received on the proposed information 
collection.
    Accordingly, no changes will be made to the rule as proposed, based 
on the comments 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/rules-regulations/moa/small-businesses. Any questions 
about the compliance guide should be sent to Antoinette Carter 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.
    In accordance with section 8e of the Act, the United States Trade 
Representative has concurred with the issuance of this rule.

List of Subjects

7 CFR Part 925

    Grapes, Marketing agreements, Reporting and recordkeeping 
requirements.

7 CFR Part 944

    Avocados, Food grades and standards, Grapefruit, Grapes, Imports, 
Kiwifruit, Limes, Olives, Oranges.

    For the reasons set forth in the preamble, 7 CFR parts 925 and 944 
are amended as follows:

0
1. The authority citation for 7 CFR parts 925 and 944 continues to read 
as follows:

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

PART 925--TABLE GRAPES GROWN IN A DESIGNATED AREA OF SOUTHEASTERN 
CALIFORNIA

0
2. Amend Sec.  925.160 by adding paragraph (c) to read as follows:


Sec.  925.160  Reports.

* * * * *
    (c) Handlers that donate grapes to charitable organizations 
pursuant to Sec.  925.304(c) shall submit a completed Food Donation 
Form (CDGAC Form No. 8) to the Committee within 2 days of receipt by 
the charitable organization. Such form shall include the following: The 
name of the producer; the name of the handler; loading location and 
date; inspection location and date; Variety(s) Federal State Inspection 
Service (FSIS) Certificate number(s); lug weight (pounds); number of 
lugs; label; signature of person responsible for loading at handling 
facility; recipient charity name; how many lugs received; signature of 
responsible charity recipient and date received. Any such grapes shall 
not be used for resale.

0
3. Amend Sec.  925.304 by redesignating paragraphs (c), (d), (e), (f), 
and (g) as paragraphs (d), (e), (f), (g), and (h), respectively, and 
adding a new paragraph (c) to read as follows:


Sec.  925.304  California Desert Grape Regulation 6.

* * * * *
    (c) Donation to charitable organizations. Handlers of grapes 
failing to meet the requirements of Sec.  925.55 and paragraph (a) of 
this section may donate such grapes to charitable organizations. Any 
such grapes shall not be used for resale. Handlers donating such grapes 
to a charitable organization shall submit a completed Food Donation 
Form, CDGAC Form No. 8, as required in Sec.  925.160(c), within 2 days 
of receipt by the intended charity.
* * * * *

PART 944--FRUITS; IMPORT REGULATIONS

0
4. In Sec.  944.350, revise paragraph (a)(1) to read as follows:

[[Page 24459]]

Sec.  944.350  Safeguard procedures for avocados, grapefruit, 
kiwifruit, olives, oranges, prune variety plums (fresh prunes), and 
table grapes, exempt from grade, size, quality, and maturity 
requirements.

    (a) * * *
    (1) Avocados, grapefruit, kiwifruit, olives, oranges, prune variety 
plums (fresh prunes) and table grapes for consumption by charitable 
institutions or distribution by relief agencies;
* * * * *

0
5. In Sec.  944.503, revise paragraphs (d) and (e) to read as follows:


Sec.  944.503  Table Grape Import Regulation 4.

* * * * *
    (d) Any lot or portion thereof which fails to meet the import 
requirements, and is not being imported for purposes of processing or 
donation to charitable organizations, prior to or after reconditioning 
may be exported or disposed of under the supervision of the Federal or 
Federal-State Inspection Service with the costs of certifying the 
disposal of said lot borne by the importer.
    (e) The grade, size, quality, and maturity requirements of this 
section shall not be applicable to grapes imported for processing or 
donation to charitable organizations, but shall be subject to the 
safeguard provisions contained in Sec.  944.350.

    Dated: April 20, 2016.
Elanor Starmer,
Administrator, Agricultural Marketing Service.
[FR Doc. 2016-09620 Filed 4-25-16; 8:45 am]
 BILLING CODE 6410-02-P