Citrus Canker; Quarantine of the State of Florida, 43345-43352 [E6-12314]

Agencies

• DEPARTMENT OF AGRICULTURE
• Animal and Plant Health Inspection Service

[Federal Register Volume 71, Number 147 (Tuesday, August 1, 2006)]
[Rules and Regulations]
[Pages 43345-43352]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-12314]


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DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

7 CFR Part 301

[Docket No. APHIS-2006-0114]
RIN 0579-AC07


Citrus Canker; Quarantine of the State of Florida

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Interim rule and request for comments.

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SUMMARY: We are amending the citrus canker regulations to list the 
entire State of Florida as a quarantined area for citrus canker and to 
amend the requirements for the movement of regulated articles from 
Florida now that the eradication of citrus canker in Florida is no 
longer being carried out as

[[Page 43346]]

an objective. We are also amending the regulations to allow regulated 
articles that would not otherwise be eligible for interstate movement 
to be moved to a port for immediate export. These changes are necessary 
in light of the Department's determination that the established 
eradication program was no longer a scientifically feasible option to 
address citrus canker.

DATES: This interim rule is effective August 1, 2006. We will consider 
all comments that we receive on or before October 2, 2006.

ADDRESSES: You may submit comments by either of the following methods:
     Federal eRulemaking Portal: Go to https://
www.regulations.gov and, in the lower ``Search Regulations and Federal 
Actions'' box, select ``Animal and Plant Health Inspection Service'' 
from the agency drop-down menu, then click on ``Submit.'' In the Docket 
ID column, select APHIS-2006-0114 to submit or view public comments and 
to view supporting and related materials available electronically. 
Information on using Regulations.gov, including instructions for 
accessing documents, submitting comments, and viewing the docket after 
the close of the comment period, is available through the site's ``User 
Tips'' link.
     Postal Mail/Commercial Delivery: Please send four copies 
of your comment (an original and three copies) to Docket No. APHIS-
2006-0114, Regulatory Analysis and Development, PPD, APHIS, Station 3A-
03.8, 4700 River Road Unit 118, Riverdale, MD 20737-1238. Please state 
that your comment refers to Docket No. APHIS-2006-0114.
    Reading Room: You may read any comments that we receive on this 
docket in our reading room. The reading room is located in room 1141 of 
the USDA South Building, 14th Street and Independence Avenue, SW., 
Washington, DC. Normal reading room hours are 8 a.m. to 4:30 p.m., 
Monday through Friday, except holidays. To be sure someone is there to 
help you, please call (202) 690-2817 before coming.
    Other Information: Additional information about APHIS and its 
programs is available on the Internet at https://www.aphis.usda.gov.

FOR FURTHER INFORMATION CONTACT: Mr. Stephen Poe, Senior Operations 
Officer, EDP, PPQ, APHIS, 4700 River Road Unit 137, Riverdale, MD 
20737-1231; (301) 734-4387.

SUPPLEMENTARY INFORMATION:

Background

    Citrus canker is a plant disease that affects plants and plant 
parts, including fresh fruit, of citrus and citrus relatives (Family 
Rutaceae). Citrus canker can cause defoliation and other serious damage 
to the leaves and twigs of susceptible plants. It can also cause 
lesions on the fruit of infected plants, which render the fruit 
unmarketable, and cause infected fruit to drop from the trees before 
reaching maturity. The aggressive A (Asiatic) strain of citrus canker 
can infect susceptible plants rapidly and lead to extensive economic 
losses in commercial citrus-producing areas.
    The regulations to prevent the interstate spread of citrus canker 
are contained in Sec. Sec.  301.75-1 through 301.75-14 of ``Subpart--
Citrus Canker'' in Title 7 of the Code of Federal Regulations. These 
regulations restrict the interstate movement of regulated articles from 
and through areas quarantined because of citrus canker and provide 
conditions under which regulated fruit may be moved into, through, and 
from quarantined areas for packing. These regulations are promulgated 
pursuant to the Plant Protection Act (7 U.S.C. 7701 et seq.).
    The regulations in Sec. Sec.  301.75-15 through 301.75-17 of 
``Subpart--Citrus Canker'' provide for the payment of compensation for 
losses due to citrus canker eradication activities under certain 
conditions. For commercial citrus groves, Sec.  301.75-15 addresses 
compensation for commercial citrus trees and Sec.  301.75-16 focuses on 
compensation for the recovery of lost production income. For citrus 
nurseries, Sec.  301.75-17 addresses compensation for certified nursery 
stock. These compensation regulations were promulgated to implement 
several appropriations statutes enacted beginning in 2000.
    The regulations governing the movement of regulated articles were 
first promulgated in 1984, at a time when citrus canker had very 
limited distribution within Florida. Although the regulations have been 
amended several times since then, the approach of the regulations has 
remained the same, i.e. to quarantine those areas where the disease was 
found and promote eradication efforts while allowing the normal 
movement of regulated fruit and other articles from those areas where 
the disease was not present.
    The exceptionally active hurricane seasons in 2004 and 2005 were 
devastating to the citrus canker eradication program. Recent surveys 
show that citrus canker has become so widespread within Florida that 
approximately 75 percent of commercial groves in the State are now 
located within 5 miles of a location where the disease has been 
detected, which is well within the range that the disease could be 
spread by future hurricanes or other tropical storms. With a 
significant portion of the commercial citrus acreage in the State now 
either infected with citrus canker or at high risk of becoming 
infected, it became apparent that it would no longer be possible to 
identify and quarantine infected citrus acreage quickly enough to 
prevent further spread of the disease. Because of this situation, on 
January 10, 2006, the U.S. Department of Agriculture (USDA) announced 
that it had determined that the established eradication program was no 
longer a scientifically feasible option to address citrus canker.
    In response to the widespread establishment of citrus canker in 
Florida, as well as other challenges to the citrus industry, key 
stakeholders in citrus protection and production discussed various 
options from which came the concept of a Citrus Health Response 
Program. This approach concentrates on the development and 
implementation of minimum standards for citrus inspection, regulatory 
oversight, disease management and education and training.
    At the same time, there is an immediate need to amend the 
regulations pertaining to citrus canker. The regulations currently 
include certain provisions that are necessary for the regulatory 
program when eradication is its goal but, in the case of Florida, they 
are no longer appropriate as the program shifts its efforts to enabling 
the commercial citrus industry to produce, harvest, process, and ship 
healthy fruit in the presence of citrus canker. Our specific amendments 
are described in the following paragraphs. One result of these changes 
is that fruit produced in Florida is no longer eligible for movement 
into commercial citrus-producing areas listed in Sec.  301.75-5.
    The regulations in Sec.  301.75-4(a) have listed portions of 12 
Florida counties as quarantined areas. Because eradication is no longer 
being pursued in Florida, the level of survey activity has dropped 
below the level necessary to maintain accurate and up-to-date 
quarantine boundaries. Therefore, we are amending Sec.  301.75-4(a) by 
removing the individual quarantined area descriptions and replacing 
them with an entry designating the entire State of Florida as a 
quarantined area for citrus canker.

[[Page 43347]]

    Paragraph (d) of Sec.  310.75-4 spells out the conditions that must 
be met in order for less than an entire State to be designated as a 
quarantined area. With our designation of the entire State of Florida 
as a quarantined area for citrus canker, those conditions will no 
longer apply to the movement of fruit and other regulated articles 
within that State. However, given that quarantining less than an entire 
State is compatible with an eradication-focused regulatory program, we 
will retain the provisions of Sec.  301.75-4(d) so that they will be 
available in the future if needed (e.g., in the event that 
circumstances change in Florida again or citrus canker appears in 
another commercial citrus-producing State). As noted previously, the 
regulations have also included certain other provisions that were 
necessary for the regulatory program when eradication was its goal; in 
this document, we have taken those provisions out of the requirements 
that generally apply to quarantined areas and have moved them into 
Sec.  301.75-4(d) so that they, like the other provisions of that 
paragraph, will be available in the future if needed.
    Specifically, the regulations in Sec.  301.75-6 spell out the 
conditions that must be met in order for any regulated articles to be 
moved interstate from a quarantined area. Paragraph (a)(1) of that 
section has required that every regulated plant and regulated tree, 
except indoor houseplants and regulated plants and regulated trees at 
nurseries, be inspected for citrus canker at least once a year, between 
May 1 and December 31. In addition, paragraph (a)(2) of that section 
has required that every regulated plant and regulated tree at every 
nursery containing regulated plants or regulated trees in the 
quarantined area be inspected for citrus canker by an inspector at 
intervals of no more than 45 days. This level of inspection is 
necessary for a regulatory program focused on eradication but it is no 
longer appropriate in all cases given the current circumstances. 
Therefore, we are moving those requirements from Sec.  301.75-6 to 
Sec.  301.75-4(d).
    Similarly, we are moving paragraph (c) of Sec.  301.75-6, which 
requires a State issued order of destruction and compliance with that 
order, within 45 days, of regulated plants or regulated trees found to 
be infected, to Sec.  301.75-4(d). Tree removal is a necessary 
component of an eradication program, but may not be appropriate in 
every case under the current circumstances.
    Paragraph (b) of Sec.  301.75-6 requires that all vehicles, 
equipment, and other articles used in providing inspection, 
maintenance, harvesting, or related services in any grove containing 
regulated plants or regulated trees, or in providing landscaping or 
lawn care services on any premises containing regulated plants or 
regulated trees, must be treated upon leaving a grove or premises in a 
quarantined area, as must all personnel who provide those services. We 
believe it is appropriate to continue to require the treatment of 
equipment and personnel involved in inspection, maintenance, 
harvesting, and related activities in all groves, so we will retain 
those provisions in Sec.  301.75-6. However, we believe the 
requirements regarding landscaping services are necessary for a 
regulatory program focused on eradication, but it is no longer 
appropriate in all cases given the current circumstances, so we are 
moving those specific provisions to Sec.  301.75-4(d).
    Section 301.75-7 spells out the requirements that must be met in 
order for regulated fruit to be moved from a quarantined area. 
Paragraph (a)(2) of that section requires that the grove producing the 
regulated fruit must have been free of citrus canker for the previous 2 
years, and that any exposed plants in the grove at high risk for 
developing citrus canker have been destroyed. The paragraph also 
describes the circumstances under which the exposed plants would be 
considered to be at high risk for developing citrus canker. These 
provisions are necessary for a regulatory program focused on 
eradication but are no longer appropriate in all cases given the 
current circumstances. Therefore, we are moving them to Sec.  301.75-
4(d).
    The regulations in Sec. Sec.  301.75-6 and 301.75-7 refer in 
several places to inspections conducted on foot or by walking through 
the grove. In this document, we have removed those references in order 
to allow inspections to be conducted by other means, such as by 
motorized 4-wheel drive vehicles. Surveys conducted while walking could 
still be conducted. Quality evaluations have shown that inspection by 
motorized 4-wheel drive vehicles is as accurate in detecting citrus 
canker as inspections by walking.
    As stated above, one result of quarantining the entire State of 
Florida is that fruit produced in that State is no longer eligible for 
movement into commercial citrus-producing areas listed in Sec.  301.75-
5. In order to make this clear, we are adding a requirement to Sec.  
301.75-7(a)(5) that boxes or other containers in which the fruit is 
packaged must be clearly marked with the statement ``Not for 
distribution in AZ, CA, HI, LA, TX, and American Samoa, Guam, Northern 
Mariana Islands, Puerto Rico, and Virgin Islands of the United 
States.''
    In addition to the changes described above, we are also adding 
provisions to Sec.  301.75-7 that will allow regulated fruit that is 
not otherwise eligible for movement in the United States to be moved 
interstate from Florida directly to a port for export. The regulated 
fruit will have to be accompanied by a limited permit issued in 
accordance with Sec.  301.75-12 and moved in a container sealed by 
APHIS directly to the port of export in accordance with the conditions 
of the limited permit.
    Similarly, we have added provisions to Sec.  301.75-6 to allow 
regulated plants produced in a nursery located in a quarantined area 
that do not meet the conditions for movement in Sec.  301.75-6(a) to be 
moved interstate for immediate export. The regulated plants must be 
accompanied by a limited permit issued in accordance with Sec.  301.75-
12 and must be moved in a container sealed by APHIS directly to the 
port of export in accordance with the conditions of the limited permit.
    These provisions are necessary to provide regulatory relief to 
growers, packers, and others who are adversely affected by new and 
existing restrictions on the movement of citrus due to citrus canker, 
while still continuing to protect against the spread of citrus canker 
to noninfested areas of the United States.

Immediate Action

    Immediate action is necessary to quarantine the entire State of 
Florida because citrus canker has become widespread in the State and 
eradication is no longer scientifically feasible. Immediate action is 
also warranted to amend certain requirements that are no longer 
applicable now that the eradication of citrus canker in Florida is no 
longer being undertaken as an objective and to provide for the movement 
of regulated fruit from Florida to certain ports for immediate export. 
Under these circumstances, the Administrator has determined that prior 
notice and opportunity for public comment are contrary to the public 
interest and that there is good cause under 5 U.S.C. 553 for making 
this action effective less than 30 days after publication in the 
Federal Register.
    We will consider comments we receive during the comment period for 
this interim rule (see DATES above). After the comment period closes, 
we will publish another document in the Federal Register. The document 
will include a discussion of any comments we receive and any amendments 
we are making to the rule.

[[Page 43348]]

Executive Order 12866 and Regulatory Flexibility Act

    This rule has been reviewed under Executive Order 12866. The rule 
has been determined to be significant for the purposes of Executive 
Order 12866 and, therefore, has been reviewed by the Office of 
Management and Budget.
    This interim rule amends the citrus canker regulations to list the 
entire State of Florida as a quarantined area and to amend the 
requirements for the movement of regulated articles from Florida now 
that the eradication of citrus canker in Florida is no longer being 
carried out as an objective. This interim rule also amends the 
regulations to allow regulated articles that would not otherwise be 
eligible for interstate movement to be moved to a port for immediate 
export. These changes are necessary in light of the Department's 
determination that the established eradication program was no longer a 
scientifically feasible option to address citrus canker.
    For this rule, we have prepared an economic analysis. The economic 
analysis provides a cost-benefit analysis as required by Executive 
Order 12866 and includes an initial regulatory flexibility analysis 
examining the potential economic effects of this rule on small 
entities, as required under 5 U.S.C. 603. The economic analysis is 
summarized below. Copies of the full analysis are available on the 
Regulations.gov Web site (see ADDRESSES above for instructions for 
accessing Regulations.gov) and may be obtained from the person listed 
under FOR FURTHER INFORMATION CONTACT.
    Section 301.75-5 of the regulations lists the designated commercial 
citrus-producing areas as American Samoa, Arizona, California, Florida, 
Guam, Hawaii, Louisiana, the Northern Mariana Islands, Puerto Rico, 
Texas, and the U.S. Virgin Islands. Of these 11 citrus-producing U.S. 
States and territories, only five States received fresh citrus 
shipments from Florida during the 2003-04 and 2004-05 seasons: Arizona, 
California, Florida, Louisiana, and Texas. In the economic analysis, 
U.S. citrus-producing areas other than Florida are referred to as other 
citrus-producing States.
    The overall objective of this interim rule is to prevent the spread 
of citrus canker to other citrus-producing States, effectively 
mitigating the costs associated with control or eradication of the 
disease and compensation of citrus producers for loss of trees and 
income. The likely results of the rule will be positive net benefits. 
Citrus produced in California, Texas, Arizona, and Louisiana is largely 
intended for the fresh market. These States would risk a reduction in 
the production of fruit intended for the fresh market with the 
establishment of citrus canker due to lesions on the fruit resulting 
from citrus canker infestation. In addition, citrus producers in these 
States could face increased costs of production, and producers and 
packers would be subject to the same trade requirements of other 
countries as Florida citrus producers and packers. Additional 
inspections for citrus canker in these States would result in increased 
public costs. Costs forgone by preventing the introduction of citrus 
canker to other citrus-producing States are expected to outweigh costs 
of the statewide quarantine for Florida's citrus industry.

U.S. Citrus Production

    The major citrus varieties produced in Florida are early, mid, and 
late season orange varieties, red and white seedless grapefruit, 
navels, early tangerines, honey tangerines, temples, and tangelos. 
Although approximately 89 percent of all Florida citrus is processed, 
utilization of production is highly dependent upon the variety. 
Approximately 95 percent of all Florida orange production is intended 
for the processing sector, whereas nearly 75 percent of Florida 
tangerine production is utilized on the fresh market. During the 2004-
05 season, nearly 58 percent of Florida grapefruit production was 
utilized on the fresh market. During previous seasons, approximately 40 
percent had been sold as fresh fruit, suggesting that Florida 
grapefruit normally intended for the processing sector was diverted to 
the fresh market in response to the post-hurricane higher prices.
    The major citrus varieties produced in California are navel and 
Valencia oranges, grapefruit, tangerines, and lemons. Approximately 78 
percent of California citrus was utilized on the fresh market during 
the 2004-05 season. Over 79 percent of all oranges produced in 
California in the 2004-05 season were produced for the fresh market. 
Additionally, almost 90 percent of grapefruit, 86 percent of 
tangerines, and 71 percent of lemons were produced for the fresh 
market. Clearly, production in California is primarily for the fresh 
market.
    The citrus varieties produced in Texas during the 2004-05 season 
were grapefruit, Valencia oranges, and midseason oranges. Fresh 
production accounted for approximately 52 percent of total production. 
Valencia and midseason orange production was destined primarily for the 
fresh market, accounting for 70 percent of total production. However, 
grapefruit production was mainly destined for the processed market, 
with 47 percent utilized on the fresh market.
    Arizona produces Valencia and navel oranges, grapefruit, 
tangerines, and lemons. Approximately 62 percent of Arizona citrus was 
utilized on the fresh market during the 2004-05 season. Of this, 
approximately 77 percent of oranges were produced for the fresh market. 
All grapefruit produced in Arizona during the 2004-05 season, 81 
percent of tangerine production, and 55 percent of lemon production 
went to the fresh market.
    Total and domestic shipments of Florida fresh citrus declined in 
the 2004-05 season from the previous season by 42 percent and 29 
percent, respectively. Fresh grapefruit had the largest share of total 
shipments of fresh Florida citrus including exports, while oranges 
accounted for the State's largest share of total domestic shipments.
    Approximately 5.7 percent of Florida domestic fresh fruit shipments 
(nearly 4 percent, including exports) were transported to other citrus-
producing States during the 2004-05 season. California received 
approximately 3 percent of total Florida fresh citrus shipments during 
the 2004-05 season. Shipments of tangerines and tangelos to other 
citrus-producing States represented about 14 percent of Florida's 
domestic shipments, a much higher percentage than for grapefruit (less 
than 2 percent) or oranges and temples (4.3 percent).

Florida's Loss of Access to Other Citrus-Producing States

    Florida's loss of market access to other citrus-producing States is 
expected to affect the citrus industries in Florida and in these other 
States. We use a partial equilibrium model to compute expected impacts 
on Florida as a result of the State-wide quarantine. For the other 
citrus-producing States, we qualitatively assess likely impacts using 
available statistics because baseline and shipment data are not 
available.

Expected Effects for Florida

    Baseline data for Florida as a domestic fresh citrus supplier are 
shown in table 1, for the three categories of citrus analyzed. Demand 
is modeled as Florida's consumption of fresh citrus produced within the 
State. It is based on 2004-05 fresh citrus shipments within Florida. 
Supply is modeled as Florida's production of fresh citrus for the 2004-
05 season, as reported in the 2004-05 Florida Citrus Summary. Grower 
price

[[Page 43349]]

is the fresh on-tree price for Florida citrus, by variety, also 
reported in the 2004-05 Florida Citrus Summary.

               Table 1.--Baseline Demand, Supply and Prices for Florida Fresh Citrus, by Variety 1
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                                                                               Oranges and       Tangerines and
                                                             Grapefruit          temples            tangelos
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Demand (kg)............................................      14,783,800         36,250,800         18,161,650
Supply (kg)............................................     286,026,000        309,916,800        163,201,800
Grower price ($/kg)....................................              $0.51              $0.17              $0.35
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1 ``Florida Fresh Citrus Shipments 2004-05 Annual Report,'' Economic and Market Research Department, Florida
  Department of Citrus, September 2005. and ``Citrus Summary 2004-05,'' Florida Agricultural Statistic Service,
  USDA, NASS, Florida Field Office.
Note: Demand represents Florida consumption of its own production. Supply represents Florida's total production.

    Based on annual data, the economic impacts and welfare effects of 
the interim rule are summarized in table 2 for the loss of market 
access of Florida fresh citrus shipments to other citrus-producing 
States. For each of the three categories of fresh citrus, the decrease 
in shipments because of the interim rule (loss of markets in the other 
citrus-producing States) will cause price declines. Florida production 
will fall and Florida consumption will rise in response to the lower 
prices.
    For fresh grapefruit, the estimated producer welfare losses are 
estimated at $1.8 million, while consumer welfare gains are expected to 
reach nearly $93,000, yielding a net welfare loss of about $1.7 
million. For fresh oranges and temples, producer losses are estimated 
at $2.8 million, while consumer surplus gains are expected to reach 
approximately $336,000, for a net welfare loss of about $2.5 million. 
For fresh tangerines and tangelos, producer losses are estimated at 
$8.2 million, while consumer surplus gains are expected to reach $1.2 
million, and net welfare losses are estimated at $7.1 million.

Table 2.--Estimated Economic Effects of a Decline in Florida Fresh Citrus Shipments Equivalent to the Quantities
                         Shipped to Other Citrus-Producing States in the 2004-05 Season
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                                                                               Oranges and       Tangerines and
                                                             Grapefruit          temples            tangelos
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Decrease in fresh citrus shipments (kg)................         1,525,700          4,120,800         20,767,300
Output data:
    Percentage change in price.........................             -1.23              -5.33             -15.00
    Change in price (per kg)...........................            ($0.01)            ($0.01)            ($0.05)
    Percent change in quantity demanded................              0.57               4.53              46.95
    Estimated change in quantity demanded..............            83,571          1,642,611          8,527,006
    Percent change in quantity supplied................             -0.50              -0.80              -7.50
    Estimated change in quantity supplied..............        (1,441,129)        (2,478,189)       (12,240,294)
Welfare effects:
    Change in consumer surplus.........................           $92,917           $335,965         $1,177,336
    Change in producer surplus.........................       ($1,788,107)       ($2,797,385)       ($8,246,894)
    Net change in welfare..............................       ($1,695,190)       ($2,461,420)       ($7,069,558)
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    These welfare effects are likely overstated because we assume that 
no alternative markets or uses exist. Loss of market access to the 
other citrus-producing States will motivate packinghouses to find other 
markets for Florida fresh citrus, whether in non-citrus-producing 
States, within Florida, or abroad. Alternatively, the fruit may be 
processed.
    In the case of tangerines and tangelos, the estimated net welfare 
losses are notably higher than for grapefruit and the orange varieties. 
As discussed earlier, tangerines and tangelos account for the largest 
percentage share of Florida fresh shipments to other citrus-producing 
States, particularly California. California provides a niche market for 
Florida fresh tangerines, especially honey tangerines, as reflected by 
the premium price received. As with grapefruit and oranges, the likely 
scenario for fresh tangerine and tangelo shipments will be diversion to 
other markets. However, diversion of tangerines and tangelos to the 
processing sector is unlikely to be as economically feasible as the 
grapefruit and orange processing sectors. Historically, tangerines and 
tangelos not suitable for the fresh market are greatly discounted, and 
producers can only, at best, recoup some of their costs by diversion to 
the processing sector.
    In the longer term, the Florida citrus industry will face 
structural adjustments due to the prevalence of citrus canker. 
Production costs will increase as citrus canker control practices are 
incorporated into the cost of planting new groves. Supply is likely to 
decrease as the industry reduces acreage allocated to the production of 
fresh citrus, and resources are reallocated to other uses.
    The loss of market access to other citrus-producing States by the 
Florida fresh citrus industry will likely result in relatively small 
welfare losses to Florida growers and packinghouses.
    Federal spending on citrus canker through FY 2006 is estimated to 
be about $941 million; $536 million for compensation and $405 million 
for eradication. Clearly, benefits of preventing the spread of citrus 
canker to other citrus producing states outweigh expected costs 
associated with Florida's loss of market access to other citrus 
producing states.

Expected Effects for the Other Citrus-Producing States

    Commercial citrus-producing States other than Florida (Arizona, 
California, Louisiana, and Texas) are also likely to be affected by the 
interim rule. However, unlike for Florida, there is not sufficient data 
to model the expected effects of this rule for these States. Although 
State-level production data

[[Page 43350]]

exists, consumption, foreign and domestic imports, and foreign and 
domestic export data are not readily available. We therefore 
qualitatively discuss possible effects.
    In the short term, producers in these States are likely to benefit 
from higher prices resulting from the State-wide quarantine of Florida 
fresh citrus. A certain amount of production within each of these 
States will be diverted from interstate and export channels to fill 
some of the void left in the absence of the Florida fresh citrus. The 
California fresh tangerine sector will likely inherit most of the 
lucrative fresh tangerine market within that State that has been 
supplied by Florida.
    Imports are also expected to supply a portion of the excess demand 
in these citrus-producing States. It is possible that additional 
oranges will be sourced from South Africa, Australia, and Mexico, 
tangerines from Mexico, and grapefruit from the Bahamas and Mexico 
based on historical import data.
    Producers in the other citrus-producing States may expand 
production slightly in the medium term in response to higher prices. 
Given the biological process associated with citrus production, 
production expansion would not be possible in the short term. The 
degree to which prices are affected by the quarantine of Florida will 
govern the response by other producers. However, given the expected 
effects in Florida as outlined above, we expect at most small 
expansions in production in Arizona, California, Louisiana, and Texas.
    Long-term effects of the interim rule for the other citrus-
producing States are uncertain. If acreage devoted to citrus production 
in Florida contracts due to continued spread of citrus canker, farmers 
in the other citrus-producing States may expand their operations. 
However, numerous other factors will influence these decisions, 
including competing land use demands and imports.
    The objective of the interim rule is to contain the spread of 
citrus canker within Florida and not allow it to spread to other 
citrus-producing States. As stated previously, while citrus canker 
affects the outward appearance of the fruit so that it may not be sold 
on the fresh market, the fruit may be used in the processing sector to 
make juice. In the case of oranges, Florida differs significantly from 
the other citrus-producing States in that approximately 95 percent of 
orange production is targeted for the processing sector. In other 
citrus-producing States, the majority of citrus produced enters the 
fresh market.
    In California, for example, approximately 78 percent of citrus 
production was utilized in the fresh market during the 2004-05 season. 
If citrus canker were introduced into any of the other citrus-producing 
States, the economic effects could be much worse than in Florida, at 
least in the case of oranges, because of the larger share of production 
that is sold as fresh fruit. Citrus destined for the fresh market is a 
higher value product that is produced at a greater expense. Producers 
would likely not recoup all of the costs associated with growing the 
oranges if they had to be diverted to the processing sector.

Alternatives

    The State-wide quarantine of Florida was one of three options 
considered for this interim rule. The Agency also considered 
maintaining the current quarantine zones. However, due to the pervasive 
spread of the disease, Agency officials determined that the quarantine 
and eradication procedures were ineffective at containing the spread of 
the disease and feared that the disease could spread to other citrus 
producing areas without additional action. APHIS thus determined that 
this option was not viable.
    APHIS also considered allowing interstate movement of Florida 
citrus fruit to any domestic location, including citrus-producing 
States, if inspection of approved groves for signs of citrus canker 60 
days prior to shipping found no symptoms of the disease. Such 
requirements would be similar to those imposed by the European Union 
for imports of Florida citrus fruit. However, pending a final 
determination by the Agency that citrus canker is unlikely to be 
introduced by asymptomatic citrus fruit, \1\ Agency officials do not 
have sufficient information on which to base such a change.
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    \1\ APHIS has considered the available scientific and other 
evidence associated with the question of asymptomatic citrus fruit 
as a pathway for the introduction of citrus canker. A risk 
evaluation has been made available for public comment and submitted 
for peer review but has not been finalized.
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    The State-wide quarantine of Florida, which prohibits the shipment 
of Florida citrus to other citrus-producing States, would allow Florida 
to ship to all other States within the United States under certain 
conditions while preventing the spread of citrus canker to other 
citrus-producing states. APHIS determined this option to be the most 
effective and reasonable alternative.

Effects on Small Entities

    The Regulatory Flexibility Act requires that agencies consider the 
economic impact of their rules on small businesses, organizations, and 
governmental jurisdictions. Section 603 of the Act requires agencies to 
prepare and make available for public comment an initial regulatory 
flexibility analysis (IRFA) describing the expected impact of proposed 
rules on small entities. Sections 603(b) and 603(c) of the Act specify 
the content of an IRFA. In this section, we address these IRFA 
requirements for this interim rule.
    The interim rule may affect producers of fresh citrus in Florida 
and other citrus-producing States, as well as firms responsible for 
packing and shipping these commodities to domestic and foreign markets. 
Affected Florida citrus producers are expected to be small businesses 
based on 2002 Census of Agriculture data and Small Business 
Administration (SBA) guidelines for entities classified within the farm 
categories Orange Groves (North American Industry Classification System 
[NAICS] 111310) and Citrus (except Orange) Groves (NAICS 111320). SBA 
classifies producers in these categories with total annual sales of not 
more than $750,000 as small entities. APHIS does not have information 
on the size distribution of the relevant producers, but according to 
2002 Census data, there were a total of 9,335 fruit and tree nut farms 
in Florida in 2002. Of this number, approximately 95 percent had annual 
sales in 2002 of less than $500,000, which is well below the SBA's 
small entity threshold of $750,000. It is reasonable to assume that 
most of the 7,072 orange, 1,861 grapefruit, 485 tangelo, 879 tangerine, 
and 345 temple farms in Florida that will be affected by this rule 
qualify as small entities.
    In the case of packinghouses, establishments engaged in Postharvest 
Crop Activities (NAICS 115114) with not more than $6.5 million in total 
annual sales are considered small businesses by SBA standards. The 
County Business Patterns report for Florida published by the U.S. 
Census Bureau states the number of firms by employment size. The number 
of employees and annual payroll for firms included in NAICS 115114 are 
reported. However, this publication does not report the value of total 
annual sales for firms in this category, nor is that information 
published in the Census of Agriculture or the Economic Census. The 
Florida Citrus Mutual reports that there are approximately 105 
packinghouses in Florida, but that

[[Page 43351]]

classification of these establishments by sales volume is not 
available. Thus, we do not know the number of packinghouses in Florida 
that would be classified as small entities based on the SBA standard 
and we welcome information that the public may provide.
    Small entities in Florida, particularly farmers, will likely face 
slightly lower prices for their citrus as a result of the 
implementation of the interim rule, as indicated in the economic 
analysis. However, these price declines (one cent per kilogram for 
grapefruit, oranges and temples; five cents per kilogram for tangerines 
and tangelos) are likely overstated since the analysis does not take 
into account opportunities for diversion of the fresh citrus shipments 
to alternative markets or for processing.
    Small entities in other citrus-producing States may be affected by 
the interim rule. However, APHIS does not believe these impacts are 
likely to be substantial. There may be minimal price increases for 
citrus farmers in the other citrus-producing States, as they at least 
partially replace the supply from Florida. Small entities in these 
States may benefit, if only marginally, from the changes proposed in 
the interim rule. APHIS welcomes public comment on these potential 
benefits to citrus producers in Arizona, California, Louisiana, and 
Texas.
    The State-wide quarantine of Florida was one of three options 
considered by APHIS for the interim rule. The Agency considered 
maintaining the current quarantine zones. However, due to the pervasive 
spread of the disease, Agency officials determined that the quarantine 
and eradication procedures were ineffective at containing the spread of 
the disease and feared that the disease could continue to spread to 
other citrus-producing areas without additional action. APHIS thus 
determined that this option was not viable. The Agency also considered 
inspection of approved groves for signs of citrus canker 60 days prior 
to shipping, similar to the current export requirements. Officials 
deemed the risk of citrus canker spreading to other citrus-producing 
States as being too high under this option, and it was abandoned. The 
State-wide quarantine of Florida, which prohibits the shipment of 
Florida citrus to other citrus-producing States, would allow Florida to 
ship to all other States within the United States while minimizing the 
probability of spreading citrus canker to other citrus-producing 
States. APHIS determined this option to be the most effective and 
reasonable alternative.

Executive Order 12372

    This program/activity is listed in the Catalog of Federal Domestic 
Assistance under No. 10.025 and is subject to Executive Order 12372, 
which requires intergovernmental consultation with State and local 
officials. (See 7 CFR part 3015, subpart V.)

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule: (1) Preempts all State and local laws and 
regulations that are inconsistent with this rule; (2) has no 
retroactive effect; and (3) does not require administrative proceedings 
before parties may file suit in court challenging this rule.

Paperwork Reduction Act

    This rule contains no new information collection or recordkeeping 
requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 
et seq.).

List of Subjects in 7 CFR Part 301

    Agricultural commodities, Plant diseases and pests, Quarantine, 
Reporting and recordkeeping requirements, Transportation.

0
Accordingly, we are amending 7 CFR part 301 as follows:

PART 301--DOMESTIC QUARANTINE NOTICES

0
1. The authority citation for part 301 continues to read as follows:

    Authority: 7 U.S.C. 7701-7772 and 7781-7786; 7 CFR 2.22, 2.80, 
and 371.3.
    Section 301.75-15 issued under Sec. 204, Title II, Public Law 
106-113, 113 Stat. 1501A-293; sections 301.75-15 and 301.75-16 
issued under Sec. 203, Title II, Public Law 106-224, 114 Stat. 400 
(7 U.S.C. 1421 note); section 301.75-17 issued under Sec. 211, Title 
II, Public Law 108-7.


0
2. In Sec.  301.75-4, paragraph (a) is revised and new paragraphs 
(d)(3) through (d)(6) are added to read as follows:


Sec.  301.75-4  Quarantined areas.

    (a) The following States or portions of States are designated as 
quarantined areas: The State of Florida.
* * * * *
    (d) * * *
    (3) Inspections. (i) In the quarantined area, every regulated plant 
and regulated tree, except indoor houseplants and regulated plants and 
regulated trees at nurseries, is inspected for citrus canker at least 
once a year, between May 1 through December 31, by an inspector.
    (ii) In the quarantined area, every regulated plant and regulated 
tree at every nursery containing regulated plants or regulated trees is 
inspected for citrus canker by an inspector at intervals of no more 
than 45 days.
    (4) Treatment of personnel, vehicles, and equipment. In the 
quarantined area, all vehicles, equipment, and other articles used in 
providing inspection, maintenance, harvesting, or related services in 
any grove containing regulated plants or regulated trees, or in 
providing landscaping or lawn care services on any premises containing 
regulated plants or regulated trees, must be treated in accordance with 
Sec.  301.75-11(d) of this subpart upon leaving the grove or premises. 
All personnel who enter the grove or premises to provide these services 
must be treated in accordance with Sec.  301.75-11(c) of this subpart 
upon leaving the grove or premises.
    (5) Destruction of infected plants and trees. No more than 7 days 
after a State or Federal laboratory confirms that a regulated plant or 
regulated tree is infected, the State must provide written notice to 
the owner of the infected plant or infected tree that the infected 
plant or infected tree must be destroyed. The owner must have the 
infected plant or infected tree destroyed within 45 days after 
receiving the written notice.
    (6) Interstate movement of regulated fruit. When less than an 
entire State is designated as a quarantined area, regulated fruit 
produced in a quarantined area may be moved interstate in accordance 
with Sec.  301.75-7(a) provided the following additional conditions are 
met:
    (i) During the 2 years before the interstate movement, no plants or 
plant parts infected with citrus canker were found in the grove 
producing the regulated fruit and any exposed plants in the grove at 
high risk for developing citrus canker have been destroyed. 
Identification of exposed plants at high risk for developing citrus 
canker will be based on an evaluation of all of the circumstances 
related to their exposure, including, but not limited to, the 
following:
    (A) The stage of maturity of the exposed plant at the time of 
exposure and the size and degree of infestation to which the plants 
were exposed,
    (B) The proximity of exposed plants to infected plants or 
contaminated articles at the time of exposure, and
    (C) The length of time the plants were exposed.
    (ii) [Reserved]

0
3. Section 301.75-6 is revised to read as follows:

[[Page 43352]]

Sec.  301.75-6  Interstate movement of regulated articles from a 
quarantined area, general requirements.

    Regulated articles may be moved interstate from a quarantined area 
into any area of the United States except commercial citrus-producing 
areas if all of the following conditions are met:
    (a) Inspections. (1) In the quarantined area, every regulated plant 
and regulated tree at every nursery containing regulated plants or 
regulated trees is inspected for citrus canker by an inspector at 
intervals of no more than 45 days.
    (2) Treatment of personnel, vehicles, and equipment. In the 
quarantined area, all vehicles, equipment, and other articles used in 
providing inspection, maintenance, harvesting, or related services in 
any grove containing regulated plants or regulated trees must be 
treated in accordance with Sec.  301.75-11(d) upon leaving the grove. 
All personnel who enter the grove or premises to provide these services 
must be treated in accordance with Sec.  301.75-11(c) upon leaving the 
grove.
    (b) Regulated plants and trees produced in a nursery located in a 
quarantined area that are not eligible for movement under paragraph (a) 
of this section may be moved interstate only for immediate export. The 
regulated plants and trees must be accompanied by a limited permit 
issued in accordance with Sec.  301.75-12 and must be moved in a 
container sealed by APHIS directly to the port of export in accordance 
with the conditions of the limited permit.

0
4. Section 301.75-7 is amended as follows:
0
a. By removing paragraph (a)(2).
0
b. By redesignating paragraphs (a)(3) through (a)(6) as paragraphs 
(a)(2) through (a)(5), respectively.
0
c. By revising newly redesignated paragraph (a)(2) to read as set forth 
below.
0
d. By revising newly redesignated paragraph (a)(5) to read as set forth 
below.
0
e. By redesignating paragraph (b) as paragraph (c) and adding a new 
paragraph (b) to read as set forth below.


Sec.  301.75-7  Interstate movement of regulated fruit from a 
quarantined area.

    (a) * * *
    (2) No more than 30 days before the beginning of harvest, every 
tree was inspected by an inspector and the grove was found free of 
citrus canker. Further, in groves producing limes, every tree was 
inspected by an inspector and the grove was found free of citrus canker 
every 120 days or less thereafter for as long as harvest continued.
* * * * *
    (5) The regulated fruit is accompanied by a limited permit issued 
in accordance with Sec.  301.75-12. The boxes or other containers in 
which the fruit is packaged must be clearly marked with the statement 
``Not for distribution in AZ, CA, HI, LA, TX, and American Samoa, Guam, 
Northern Mariana Islands, Puerto Rico, and Virgin Islands of the United 
States.''
* * * * *
    (b) Regulated fruit produced in a quarantined area that is not 
eligible for movement under paragraph (a) of this section may be moved 
interstate only for immediate export. The regulated fruit must be 
accompanied by a limited permit issued in accordance with Sec.  301.75-
12 and must be moved in a container sealed by APHIS directly to the 
port of export in accordance with the conditions of the limited permit.
* * * * *

    Done in Washington, DC, this 26th day of July 2006.
Charles D. Lambert,
Acting Under Secretary for Marketing and Regulatory Programs.
[FR Doc. E6-12314 Filed 7-31-06; 8:45 am]
BILLING CODE 3410-34-P