[Federal Register Volume 84, Number 249 (Monday, December 30, 2019)]
[Proposed Rules]
[Pages 71829-71832]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-28057]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 84, No. 249 / Monday, December 30, 2019 / 
Proposed Rules  

[[Page 71829]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1260

[No. AMS-LP-19-0012]


Beef Promotion and Research; Reapportionment

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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

SUMMARY: This proposed rule would adjust representation on the 
Cattlemen's Beef Promotion and Research Board (Board), established 
under the Beef Promotion and Research Act of 1985 (Act), to reflect 
changes in domestic cattle inventories as well as changes in levels of 
imported cattle, beef, and beef products that have occurred since the 
Board was last reapportioned in July 2017. These adjustments are 
required by the Beef Promotion and Research Order (Order) and, if 
adopted, would result in an increase in Board membership from 99 to 
101, effective with the Secretary of Agriculture's (Secretary) 
appointments for terms beginning early in the year 2021.

DATES: Submit comments on or before February 28, 2020.

ADDRESSES: Comments should be posted online at www.regulations.gov. 
Comments received will be posted without change, including any personal 
information provided. All comments should reference the docket number 
AMS-LP-19-0012, the date of submission, and the page number of this 
issue of the Federal Register. Comments may also be sent to Kahl 
Sesker, Agricultural Marketing Specialist; Research and Promotion 
Division; Livestock and Poultry Program, AMS, USDA; Room 2610-S, STOP 
0251, 1400 Independence Avenue SW; Washington, DC 20250-0251; or via 
fax to (202) 720-1125. Comments will be made available for public 
inspection at the above address during regular business hours or via 
the internet at www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Kahl Sesker, Research and Promotion 
Division, at (202) 253-8253; fax (202) 720-1125; or by email at 
[email protected].

SUPPLEMENTARY INFORMATION: 

Executive Orders 12866, 13563, and 13771

    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health, and safety effects; distributive impacts; and equity). 
Executive Order 13563 emphasizes the importance of quantifying both 
costs and benefits, reducing costs, harmonizing rules, and promoting 
flexibility. This rule does not meet the definition of a significant 
regulatory action contained in section 3(f) of Executive Order 12866 
and therefore, the Office of Management and Budget (OMB) has waived 
review of this action. Additionally, because this rule does not meet 
the definition of a significant regulatory action, it does not trigger 
the requirements contained in Executive Order 13771. See OMB's 
Memorandum titled ``Interim Guidance Implementing Section 2 of the 
Executive Order of January 30, 2017, titled `Reducing Regulation and 
Controlling Regulatory Costs' '' (February 2, 2017).

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is not intended to have retroactive 
effect.
    Section 11 of the Act (7 U.S.C. 2910) provides that nothing in the 
Act may be construed to preempt or supersede any other program relating 
to beef promotion organized and operated under the laws of the U.S. or 
any State. There are no administrative proceedings that must be 
exhausted prior to any judicial challenge to the provisions of this 
rule.

Executive Order 13175

    This action has been reviewed in accordance with the requirements 
of Executive Order 13175, Consultation and Coordination with Indian 
Tribal Governments. The review reveals that this regulation would not 
have substantial and direct efforts on Tribal governments or 
significant Tribal implications.

Paperwork Reduction Act

    In accordance with OMB regulations (5 CFR 1320) that implement the 
Paperwork Reduction Act of 1995 (44 U.S.C. part 35), the information 
collection and recordkeeping requirements contained in the Order and 
accompanying Rules and Regulations have previously been approved by OMB 
and were assigned OMB control number 0581-0093.

Background and Proposed Action

    The Board was initially appointed on August 4, 1986, pursuant to 
the provisions of the Act (7 U.S.C. 2901-2911), and the Order issued 
thereunder. Domestic representation on the Board is based on cattle 
inventory numbers, while importer representation is based on the 
conversion of the volume of imported cattle, beef, and beef products 
into live animal equivalencies.

Reapportionment

    Section 1260.141(b) of the Order provides that the Board shall be 
composed of cattle producers and importers appointed by the Secretary 
from nominations submitted by certified producer and importer 
organizations. A producer may only be nominated to represent the State 
or unit in which that producer is a resident.
    Section 1260.141(c) of the Order provides that at least every 3 
years, but not more than every 2 years, the Board shall review the 
geographic distribution of cattle inventories throughout the United 
States and the volume of imported cattle, beef, and beef products and, 
if warranted, shall reapportion units and/or modify the number of Board 
members from units in order to reflect the geographic distribution of 
cattle production volume in the United States and the volume of cattle, 
beef, or beef products imported into the United States.
    Section 1260.141(d) of the Order authorizes the Board to recommend 
to the Secretary modifications to the number of cattle per unit 
necessary for representation on the Board.
    Section 1260.141(e)(1) provides that each geographic unit or State 
that includes a total cattle inventory equal to or greater than 500,000 
head of cattle shall be entitled to one representative on the Board. 
Section 1260.141(e)(2)

[[Page 71830]]

provides that States that do not have total cattle inventories equal to 
or greater than 500,000 head shall be grouped, to the extent 
practicable, into geographically-contiguous units, each of which have a 
combined total inventory of not less than 500,000 head. Such grouped 
units are entitled to at least one representative on the Board. Each 
unit is entitled to an additional Board member for each additional 1 
million head of cattle within the unit, as provided in Sec.  
1260.141(e)(4). Further, as provided in Sec.  1260.141(e)(3), importers 
are represented by a single unit, with their number of Board members 
based on a conversion of the total volume of imported cattle, beef, or 
beef products into live animal equivalencies.
    The proposed producer representation is based on an average of the 
inventory of cattle in the various States on January 1 in 2017, 2018, 
and 2019 as reported by USDA's National Agricultural Statistics Service 
(NASS). The proposed importer representation is based on a combined 
total average of the 2016, 2017, and 2018 live cattle imports as 
published by USDA's Economic Research Service (ERS) and the average of 
the 2016, 2017, and 2018 live animal equivalents for imported beef and 
beef products.
    In considering reapportionment, the Board reviewed cattle 
inventories as of January 1 in 2017, 2018, and 2019, as well as cattle, 
beef, and beef product import data for the period of January 1, 2016, 
to December 31, 2018. The Board determined that an average of the 
inventory of cattle on January 1 in 2017, 2018, and 2019 best reflect 
the number of cattle in each State or unit since publication of the 
last reapportionment rule in 2017 (82 FR 27611). The Board reviewed 
data published by ERS to determine proper importer representation. The 
Board recommended the use of the average of a combined total of the 
2016, 2017, and 2018 cattle import data and the average of the 2016, 
2017, and 2018 live animal equivalents for imported beef products. The 
method used to calculate the total number of live animal equivalents 
was the same as that used in the previous reapportionment of the Board. 
The live animal equivalent weight was changed in 2006 from 509 pounds 
to 592 pounds (71 FR 47074).
    The Board's recommended reapportionment plan, if adopted, would 
increase the number of representatives on the Board from 99 to 101. 
From the Board's analysis of USDA cattle inventories and import 
equivalencies, Nebraska would gain one Board seat, Texas would gain one 
Board seat, and Wisconsin would gain one Board seat. Geographic changes 
would include dissolving the Southeast Unit so that Alabama and Georgia 
would be stand-alone States that have enough inventory to each qualify 
for a position on the Board. South Carolina would be added to the Mid-
Atlantic Unit. Maryland would move from the Mid-Atlantic Unit to the 
Northeast Unit, leaving South Carolina and West Virginia to make up the 
new Mid-Atlantic Unit, which would qualify for one member. The new 
Northeast Unit would qualify for one member and be composed of 
Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, 
New Jersey, Rhode Island, and Vermont. Importer representation would 
remain at seven.
    The States and units affected by the reapportionment plan and the 
current and proposed member representation per unit are as follows:

----------------------------------------------------------------------------------------------------------------
                                                                                      Current         Revised
                  State/unit                            Increase/decrease         representation  representation
----------------------------------------------------------------------------------------------------------------
Alabama.......................................  +1 (moved from Southeast Unit)..               0               1
Georgia.......................................  +1 (moved from Southeast Unit)..               0               1
Nebraska......................................  +1..............................               6               7
Texas.........................................  +1..............................              12              13
Wisconsin.....................................  +1..............................               3               4
Mid-Atlantic Unit.............................  No change.......................               1               1
Northeast Unit................................  No change.......................               1               1
Southeast Unit................................  -3..............................               3               0
Net Change....................................  +2..............................  ..............  ..............
----------------------------------------------------------------------------------------------------------------
Note: The Southeast Unit would dissolve. Alabama and Georgia, formerly of SE Unit will each have one member on
  the Board. South Carolina, formerly of SE Unit, moves to Mid-Atlantic Unit. Maryland moves from the Mid-
  Atlantic Unit and to the Northeast Unit leaving South Carolina and West Virginia to make up the new Mid-
  Atlantic Unit and qualify for one member. The new Northeast Unit continues to qualify for one member. In
  summary, the Board will be composed of 101 members (99-3 + 5 = 101).

    The Board reapportionment as proposed by this rulemaking would take 
effect, if adopted, with the Secretary's appointments to fill positions 
early in the year 2021.
    A 60-day comment period is provided to allow interested persons to 
respond to this proposal.

Initial Regulatory Flexibility Act

    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (RFA) (5 U.S.C. 601 et seq.), AMS considered the 
economic effect of this action on small entities and determined that 
this proposed rule would not have a significant economic impact on a 
substantial number of small entities. The purpose of RFA is to fit 
regulatory actions to the scale of businesses subject to such actions 
in order that small businesses will not be unduly burdened.
    Effective August 19, 2019, the SBA published an interim final rule 
(RIN 3245-AH17) that adjusts the monetary-based size standards for 
inflation. As a result of this rule, the size classification for small 
beef, veal, and cattle importing firms changed from sales of $750,000 
or less to sales of $1,000,000 or less.

[[Page 71831]]

    According to the NASS 2017 Census of Agriculture, the number of 
operations in the United States with cattle totaled 882,692.\1\ The 
most recent (2017) Census of Agriculture data show that roughly 4 
percent of producers with cattle, or 31,601 operations, have annual 
receipts of $1,000,000 or more.\2\ Therefore, the vast majority of 
cattle producers, 96 percent, would be considered small businesses with 
the new SBA guidance. It should be noted that producers are only 
indirectly impacted by the proposed rule.
---------------------------------------------------------------------------

    \1\ https://www.nass.usda.gov/AgCensus/index.php.
    \2\ https://quickstats.nass.usda.gov/results/EC7DF8E2-6791-347F-BC4F-3F81988D7DDB.
---------------------------------------------------------------------------

    Cattle, beef, and veal importers are directly impacted by the 
proposed rule. The original number of importing firms was determined in 
consultation with the Meat Import Council of America. AMS estimates 
that approximately 270 firms import beef or beef products, and veal and 
veal products into the United States, and about 198 firms import live 
cattle into the United States. The 2012 Economic Census, produced by 
the U.S. Commerce Department, and accessible through the American Fact 
Finder website, provides the most recent data on firm size by sales 
revenue.\3\ However, data on the firm size of beef, veal, and cattle 
importers are not available in this or other economic databases, as 
there is no NAICS code specific enough for this industry segment.
---------------------------------------------------------------------------

    \3\ https://factfinder.census.gov.
---------------------------------------------------------------------------

    The 2012 Economic Census does have information on the broader 
marketing chain, specifically the size distribution of meat and meat 
product wholesalers (NAICS 42447).\4\ These data show that 18 percent 
of firms in the industry classification of meat and meat product 
wholesalers are considered small businesses.
---------------------------------------------------------------------------

    \4\ Source: U.S. Census Bureau, 2012 Economic Census, Search 
code EC1242SSSZ1_with_ann.
---------------------------------------------------------------------------

    Recent import trade data was also considered for understanding the 
overall dynamics of this industry segment. The USDA Foreign 
Agricultural Service reports monthly trade data for traded agricultural 
products by product type. An analysis of these data over a five-year 
period show only minor changes in the annual import values for both 
beef and veal importers and cattle importers, suggesting little change 
in the sector overall.
    The proposed rule imposes no new burden on the industry, as it only 
adjusts representation on the Board to reflect changes in domestic 
cattle inventory, as well as in cattle and beef imports. The 
adjustments are required by the Order and would result in an increase 
in Board membership from 99 to 101.
    AMS is committed to complying with the E-Government Act of 2002 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.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap, or conflict with this rule.

List of Subjects in 7 CFR Part 1260

    Administrative practice and procedure, Advertising, Agricultural 
research, Imports, Meat and meat products, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, AMS proposes to amend 7 
CFR part 1260 as follows:

PART 1260--BEEF PROMOTION AND RESEARCH

0
1. The authority citation for 7 CFR part 1260 continues to read as 
follows:

    Authority:  7 U.S.C. 2901-2911 and 7 U.S.C. 7401.

0
2. Revise Sec.  1260.141 paragraph (a) to read as follows:


Sec.  1260.141  Membership of Board.

    (a) Beginning with the 2020 Board nominations and the associated 
appointments effective early in the year 2021, the United States shall 
be divided into 38 geographical units and 1 unit representing 
importers, for a total of 39 units. The number of Board members from 
each unit shall be as follows:

             Table 1 to Paragraph (a): Cattle and Calves \1\
------------------------------------------------------------------------
               State/unit                  (1,000 Head)      Directors
------------------------------------------------------------------------
1. Alabama..............................           1,313               1
2. Arizona..............................           1,003               1
3. Arkansas.............................           1,763               2
4. Colorado.............................           2,850               3
5. Florida..............................           1,670               2
6. Georgia..............................           1,080               1
7. Idaho................................           2,430               2
8. Illinois.............................           1,190               1
9. Indiana..............................             877               1
10. Iowa................................           3,950               4
11. Kansas..............................           6,350               6
12. Kentucky............................           2,153               2
13. Louisiana...........................             800               1
14. Michigan............................           1,163               1
15. Minnesota...........................           2,360               2
16. Mississippi.........................             907               1
17. Missouri............................           4,317               4
18. Montana.............................           2,567               3
19. Nebraska............................           6,683               7
20. New Mexico..........................           1,473               1
21. New York............................           1,477               1
22. North Carolina......................             810               1
23. North Dakota........................           1,837               2
24. Ohio................................           1,303               1
25. Oklahoma............................           5,133               5
26. Oregon..............................           1,303               1
27. Pennsylvania........................           1,613               2

[[Page 71832]]

 
28. South Dakota........................           3,967               4
29. Tennessee...........................           1,820               2
30. Texas...............................          12,600              13
31. Utah................................             807               1
32. Virginia............................           1,480               1
33. Wisconsin...........................           3,500               4
34. Wyoming.............................           1,317               1
35. Northwest Unit......................  ..............  ..............
     Alaska.....................              15  ..............
     Hawaii.....................             143  ..............
     Washington.................           1,163  ..............
        Total...........................           1,321               1
  36. Northeast Unit....................  ..............  ..............
     Connecticut................              48  ..............
     Delaware...................              16  ..............
     Maine......................              81  ..............
     Maryland...................             192  ..............
     Massachusetts..............              38  ..............
     New Hampshire..............              35  ..............
     New Jersey.................              29  ..............
     Rhode Island...............               5  ..............
     Vermont....................             260  ..............
        Total...........................             702               1
  37. Mid-Atlantic Unit.................  ..............  ..............
     South Carolina.............             342  ..............
     West Virginia..............             397  ..............
        Total...........................             738               1
  38. Southwest Unit....................  ..............  ..............
     California.................           5,167  ..............
     Nevada.....................             460  ..............
        Total...........................           5,627               6
  39. Importers Unit \2\................           6,874               7
------------------------------------------------------------------------
\1\ 2017, 2018, and 2019 average of January 1 cattle inventory data.
\2\ 2016, 2017, and 2018 average of annual import data.

* * * * *

    Dated: December 20, 2019.
Bruce Summers,
Administrator, Agricultural Marketing Service.
[FR Doc. 2019-28057 Filed 12-27-19; 8:45 am]
 BILLING CODE 3410-02-P