Tomatoes Grown in Florida; Partial Exemption to the Minimum Grade Requirements, 76191-76193 [E8-29658]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 73, Number 242 (Tuesday, December 16, 2008)]
[Rules and Regulations]
[Pages 76191-76193]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-29658]



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Federal Register / Vol. 73, No. 242 / Tuesday, December 16, 2008 / 
Rules and Regulations

[[Page 76191]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 966

[Docket No. AMS FV-08-0090; FVO9-966-1 IFR]


Tomatoes Grown in Florida; Partial Exemption to the Minimum Grade 
Requirements

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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

SUMMARY: This rule provides a partial exemption to the minimum grade 
requirements under the marketing order for tomatoes grown in Florida 
(order). The order regulates the handling of tomatoes grown in Florida 
and is administered locally by the Florida Tomato Committee 
(Committee). Absent an exemption, Florida tomatoes covered by the order 
must meet at least a U.S. No. 2 grade before they can be shipped and 
sold outside the regulated area. This rule exempts Vintage Ripes\TM\ 
tomatoes (Vintage Ripes\TM\) from the shape requirements associated 
with the U.S. No. 2 grade. This change increases the volume of Vintage 
Ripes\TM\ that will meet the order requirements, and will help increase 
shipments and availability of these tomatoes.

DATES: Effective December 17, 2008; comments received by February 17, 
2009 will be considered prior to issuance of a final rule.

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

FOR FURTHER INFORMATION CONTACT: William Pimental, Marketing 
Specialist, or Christian Nissen, Regional Manager, Southeast Marketing 
Field Office, Marketing Order Administration Branch, Fruit and 
Vegetable Programs, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 
325-8793, or e-mail: William.Pimental@usda.gov or 
Christian.Nissen@usda.gov.
    Small businesses may request information on complying with this 
regulation by contacting Jay Guerber, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence 
Avenue, SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 
720-2491, Fax: (202) 720-8938, or e-mail: Jay.Guerber@usda.gov.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement No. 125 and Marketing Order No. 966, both as amended (7 CFR 
part 966), regulating the handling of tomatoes grown in certain 
designated counties in Florida, hereinafter referred to as the 
``order.'' The marketing agreement and order are effective under the 
Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-
674), hereinafter referred to as the ``Act.''
    The Department of Agriculture (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect. 
This rule will not preempt any State or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with this 
rule.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA a petition 
stating that the order, any provision of the order, or any obligation 
imposed in connection with the order is not in accordance with law and 
request a modification of the order or to be exempted therefrom. A 
handler is afforded the opportunity for a hearing on the petition. 
After the hearing, USDA would rule on the petition. The Act provides 
that the district court of the United States in any district in which 
the handler is an inhabitant, or has his or her principal place of 
business, has jurisdiction to review USDA's ruling on the petition, 
provided an action is filed not later than 20 days after the date of 
the entry of the ruling.
    This rule adds a partial exemption to the minimum grade 
requirements prescribed under the order. Absent an exemption, Florida 
tomatoes covered by the order must meet at least a U.S. No. 2 grade 
before they can be shipped and sold outside the regulated area. This 
rule exempts Vintage Ripes\TM\ from the shape requirements associated 
with the U.S. No. 2 grade. This change increases the volume of Vintage 
Ripes\TM\ that will meet the order requirements, and will help increase 
shipments and availability of these tomatoes.
    Section 966.52 of the order provides the authority for the 
establishment of grade and size requirements for Florida tomatoes. Form 
and shape represent part of the elements of grade. Section 966.323 of 
the order's rules and regulations specifies, in part, the minimum grade 
requirements for Florida tomatoes. The current minimum grade 
requirement for Florida tomatoes is a U.S. No. 2. The specifics of this 
grade requirement are listed under the U.S. Standards for Grades of 
Fresh Tomatoes (7 CFR 51.1855-51.1877).
    The U.S. Standards for Grades of Fresh Tomatoes (Standards) specify 
the criteria tomatoes must meet to grade a U.S. No. 2, including that 
they must be reasonably well formed, and not more than slightly rough. 
These two elements relate specifically to the shape of the tomato. The 
definitions section of the Standards defines reasonably well formed as 
not decidedly kidney shaped, lopsided, elongated, angular, or otherwise 
decidedly deformed. The term slightly rough means that the tomato is 
not decidedly ridged or grooved. This rule amends Sec.  966.323 to 
exempt Vintage Ripes\TM\ from these

[[Page 76192]]

shape requirements as specified under the grade for a U.S. No. 2.
    Vintage Ripes\TM\ are a trademarked tomato variety bred to look and 
taste like an heirloom-type tomato. One of the characteristics of this 
variety is its appearance. Vintage Ripes\TM\ are often shaped 
differently from other round tomatoes. Depending on the time of year 
and the weather, Vintage Ripes\TM\ are concave on the stem end with 
deep, ridged shoulders. They can also be very misshapen, appearing 
kidney shaped or lopsided. Because of this variance in shape and 
appearance, Vintage Ripes\TM\ have difficulty meeting the shape 
requirements of the U.S. No. 2 grade.
    In addition, the cost of production and handling for these tomatoes 
tends to be higher when compared to standard commercial varieties. The 
shoulders on Vintage Ripes\TM\ are easily damaged, requiring additional 
care during picking and handling. These tomatoes are also more 
susceptible to disease. Consequently, Vintage Ripes\TM\ require greater 
care in production to keep injuries and blemishes to a minimum. Still, 
when compared to standard commercial varieties, even with taking 
special precautions, larger quantities of these tomatoes are left in 
the field or need to be eliminated in the packinghouse to ensure a 
quality product. Losses can approach 50 percent or higher for Vintage 
Ripes\TM\. With the higher production costs and the reduced packout, 
these tomatoes tend to sell at a higher price point than standard round 
tomatoes.
    Heirloom-type tomatoes have been gaining favor with consumers. 
Vintage Ripes\TM\ were bred specifically to address this demand. 
However, with its difficulty in meeting established shape requirements, 
and its increased cost of production, producing these tomatoes for 
market may not be financially viable without an exemption. In order to 
make more of these specialty tomatoes available for consumers, the 
Committee agreed to exempt Vintage Ripes\TM\ from the shape 
requirements of the U.S. No. 2 grade. This exemption is the same as 
previously provided for a similar type tomato (72 FR 1919, January 17, 
2007).
    This rule only provides Vintage Ripes\TM\ with a partial exemption 
from the grade requirements under the order. Consequently, Vintage 
Ripes\TM\ will be exempt from the shape requirements of the grade but 
will still be required to meet all other aspects of the U.S. No. 2 
grade. Vintage Ripes\TM\ also continue to be required to meet all other 
requirements under the order, such as size, pack and container, and 
inspection.
    Prior to the 1998-99 season, the Committee recommended that the 
minimum grade be increased from a U.S. No. 3 to a U.S. No. 2. Committee 
members agree that increasing the grade requirement has been very 
beneficial to the industry and in the marketing of Florida tomatoes. It 
is important to the Committee that these benefits be maintained. There 
was some industry concern that providing a partial exemption for shape 
for an heirloom-type tomato could result in the shipment of U.S. No. 3 
grade tomatoes of standard commercial varieties, contrary to the 
objectives of the exemption and the order.
    To ensure this exemption does not result in the shipment of U.S. 
No. 3 grade tomatoes of other varieties, this exemption only applies to 
Vintage Ripes\TM\ covered under the Agricultural Marketing Service's 
Identity Preservation (IP) program. The IP program was developed by the 
Agricultural Marketing Service to assist companies in marketing 
products having unique traits. The program provides independent, third-
party verification of the segregation of a company's unique product at 
every stage, from seed, production and processing, to distribution. 
This exemption would be contingent upon the Vintage Ripes\TM\ gaining 
positive program status under the IP program and continuing to meet 
program requirements. As such, this should help ensure that only 
Vintage Ripes\TM\ are shipped under this exemption.
    Therefore, this rule exempts Vintage Ripes\TM\ from the shape 
requirements associated with the U.S. No. 2 grade. This change 
increases the volume of Vintage Ripes\TM\ tomatoes that will meet order 
requirements, and will help increase shipments and availability of 
these tomatoes.
    Section 8e of the Act provides that when certain domestically 
produced commodities, including tomatoes, are regulated under a Federal 
marketing order, imports of that commodity must meet the same or 
comparable grade, size, quality, and maturity requirements. Since this 
rule provides a partial exemption from the minimum grade requirements 
under the domestic handling regulations, a corresponding change to the 
import regulations is also needed. A rule providing a similar partial 
exemption to the minimum grade requirements under the import 
regulations will be issued as a separate action.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this action on small entities. Accordingly, AMS has 
prepared this initial regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the 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 100 producers of tomatoes in the production 
area and approximately 70 handlers subject to regulation under the 
marketing order. Small agricultural producers are defined by the Small 
Business Administration (SBA) as those having annual receipts less than 
$750,000, and small agricultural service firms are defined as those 
whose annual receipts are less than $7,000,000 (13 CFR 121.201).
    Based on industry and Committee data, the average annual price for 
fresh Florida tomatoes during the 2007-08 season was approximately 
$13.71 per 25-pound container, and total fresh shipments for the 2007-
08 season were 45,177,457 25-pound cartons of tomatoes. Committee data 
indicates that around 25 percent of the handlers handle 94 percent of 
the total volume shipped outside the regulated area. Based on the 
average price, about 75 percent of handlers could be considered small 
businesses under SBA's definition. In addition, based on production 
data, grower prices as reported by the National Agricultural Statistics 
Service, and the total number of Florida tomato growers, the average 
annual grower revenue is below $750,000. Thus, the majority of handlers 
and producers of Florida tomatoes may be classified as small entities.
    This rule provides a partial exemption to the minimum grade 
requirements for tomatoes grown in Florida. Absent an exemption, 
Florida tomatoes covered by the order must meet at least a U.S. No. 2 
grade before they can be shipped and sold outside the regulated area. 
This rule exempts Vintage Ripes\TM\ from the shape requirements 
associated with the U.S. No. 2 grade. This change increases the volume 
of Vintage Ripes\TM\ that will meet the order requirements, and will 
help increase shipments and availability of these tomatoes. This rule 
amends the provisions of Sec.  966.323. Authority for this action is 
provided in Sec.  966.52 of the order.

[[Page 76193]]

    This change represents a small increase in costs for producers and 
handlers of Vintage Ripes\TM\, primarily from costs associated with 
developing and maintaining the IP program. However, this rule will make 
additional volumes of Vintage Ripes\TM\ available for shipment. This 
should result in increased sales of Vintage Ripes\TM\. Consequently, 
the benefits of this action are expected to more than offset the 
associated costs.
    One alternative to this action that was considered was to not 
provide an exemption from shape requirements for Vintage Ripes\TM\. 
However, providing the exemption will increase the volume of Vintage 
Ripes\TM\ that will meet the order requirements, and will help increase 
shipments and availability of these tomatoes for consumers. Further, 
the same exemption had been provided previously for a similar tomato. 
Therefore, this alternative was rejected.
    This rule will not impose any additional reporting or recordkeeping 
requirements beyond the IP program on either small or large tomato 
handlers. 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.
    AMS is committed to complying with the E-Government Act, to promote 
the use of the Internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.
    In addition, USDA has not identified any relevant Federal rules 
that duplicate, overlap or conflict with this rule.
    Further, the Committee's meeting was widely publicized throughout 
the Florida tomato industry and all interested persons were invited to 
attend the meeting and participate in Committee deliberations. Like all 
Committee meetings, the September 4, 2008, meeting was a public meeting 
and all entities, both large and small, were able to express their 
views on this issue.
    Finally, interested persons are invited to submit comments on this 
interim final rule, including the regulatory and informational impacts 
of this action on small businesses.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http:/
/www.ams.usda.gov/AMSv1.0/
ams.fetchTemplateData.do?template=TemplateN&page=MarketingOrdersSmallBus
inessGuide. Any questions about the compliance guide should be sent to 
Jay Guerber at the previously mentioned address in the FOR FURTHER 
INFORMATION CONTACT section.
    This rule invites comments on a partial exemption to the minimum 
grade requirements prescribed under the order. A 60-day comment period 
is provided to allow interested persons to respond to this rule. All 
written comments timely received will be considered before a final 
determination is made on this matter.
    After consideration of all relevant material presented, including 
the Committee's recommendation, and other information, it is found that 
this interim final rule, as hereinafter set forth, will tend to 
effectuate the declared policy of the Act.
    Pursuant to 5 U.S.C. 553, it is also found and determined upon good 
cause that it is impracticable, unnecessary, and contrary to the public 
interest to give preliminary notice prior to putting this rule into 
effect and that good cause exists for not postponing the effective date 
of this rule until 30 days after publication in the Federal Register 
because: (1) The shipment of Florida Vintage Ripes\TM\ begins in 
November, 2008; (2) this rule relaxes requirements prescribed in the 
order; (3) the Committee unanimously recommended this change at a 
public meeting and interested parties had an opportunity to provide 
input; and (4) this rule provides a 60-day comment period and any 
comments received will be considered prior to finalization of this 
rule.

List of Subjects in 7 CFR Part 966

    Marketing agreements, Reporting and recordkeeping requirements, 
Tomatoes.

0
For the reasons set forth in the preamble, 7 CFR part 966 is amended as 
follows:

PART 966--TOMATOES GROWN IN FLORIDA

0
1. The authority citation for 7 CFR part 966 continues to read as 
follows:


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

0
2. In Sec.  966.323, paragraph (d)(5) all references to 
``UglyRipe\TM\'' are revised to read ``UglyRipe\TM\ and Vintage 
Ripes\TM\''.

    Dated: December 10, 2008.
James E. Link,
Administrator, Agricultural Marketing Service.
 [FR Doc. E8-29658 Filed 12-15-08; 8:45 am]
BILLING CODE 3410-02-P