Delivery and Shipping Standards for Cotton Warehouses, 13562-13565 [2019-06699]
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Federal Register / Vol. 84, No. 66 / Friday, April 5, 2019 / Proposed Rules
on Tribal consultation and
collaboration.
Civil Rights Impact Analysis
FNS has reviewed this proposed rule
in accordance with Departmental
Regulations 4300–4, ‘‘Civil Rights
Impact Analysis’’ and 1512–1,
‘‘Regulatory Decision Making
Requirements’’ to identify and address
any major civil rights impacts the
proposed rule might have on minorities,
women, persons with disabilities, or
other protected classes. FNS has
determined that this proposed rule will
not have an adverse impact on any retail
food store owners or SNAP recipients
belonging to protected classes. The
regulation only concerns those retail
food stores participating in SNAP that
would not meet the increased staple
food stocking requirements necessary
for SNAP authorization that were
mandated by the 2014 Farm Bill and
codified in the 2016 final rule,
‘‘Enhancing Retailer Standards in the
Supplemental Nutrition Assistance
Program (SNAP).’’ The proposed
regulatory changes would aid those
retail stores, which are primarily small
format retailers, in meeting the
enhanced stocking requirements of the
2016 final rule. This proposed rule
would not change any requirements
related to the eligibility or participation
of protected classes or individuals,
minority owned or operated business
entities, or woman owned or operated
business entities in SNAP. As a result,
this rulemaking would have no
differential impact on protected classes
of individuals, minority owned or
operated business entities, or woman
owned or operated business entities.
Relatedly, FNS does not collect data
from retail food stores regarding any of
the protected classes under Title VI of
the Civil Rights Act of 1964, and FNS
specifically prohibits retailers that
participate in SNAP to engage in actions
that discriminate based on race, color,
national origin, sex, age, disability,
religion or political belief.
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Paperwork Reduction Act
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List of Subjects
7 CFR Part 271
Food stamps, Grant programs—Social
programs, Reporting and recordkeeping
requirements.
7 CFR Part 278
Banks, banking, Food stamps, Grant
programs—social programs, Penalties,
Reporting and recordkeeping
requirements, Surety bonds.
Accordingly, 7 CFR parts 271 and 278
are proposed to be amended as follows:
■ 1. The authority citation for parts 271
and 278 continue to read as follows:
Authority: 7 U.S.C. 2011–2036.
PART 271—GENERAL INFORMATION
AND DEFINITIONS
2. In § 271.2, add a definition for
Variety in alphabetical order to read as
follows:
■
§ 271.2
Definitions.
*
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Variety, in evaluating a firm’s stock of
staple foods for purposes of determining
eligibility to participate in SNAP, means
foods that differ from each other by
distinct main ingredient or product kind
as determined by the Secretary. See 7
CFR 278.1(b)(1)(ii)(C).
*
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PART 278—PARTICIPATION OF
RETAIL FOOD STORES, WHOLESALE
FOOD CONCERNS AND INSURED
FINANCIAL INSTITUTIONS
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grapes in the vegetables or fruits
category; or fat-reduced cow milk,
almond-based milk substitute, soy-based
yogurt substitute, soft goat milk-based
cheese, cow milk-based butter, cow
milk-based sour cream, and cow milkbased full-fat yogurt in the dairy
products category; or rice, wheat-based
bagels, 100% whole grain wheat-based
bagels, wheat-based pitas, rye-based
bread, rice-based pasta, oatmeal, and
wheat-based matzah in the bread or
cereals category; or shelf-stable chicken,
beans, nuts/seeds, perishable beef,
perishable pork, chicken eggs, and
perishable chicken in the meat, poultry,
or fish category.
(2) Variety of foods is not to be
interpreted as different brands, nutrient
values (e.g., low sodium and lite),
flavorings (e.g., vanilla and chocolate),
packaging types or styles (e.g. boxed and
bagged, or fresh and frozen), meat cuts,
product shapes, textures, or package
sizes of the same or similar foods except
where explicitly specified in Agency
guidance. Similar food items such as,
but not limited to, tomatoes and tomato
juice, brown rice and white rice, 1%
milk and skim milk, perishable ground
beef and perishable beefsteak, or
different types of apples (e.g., Empire,
Jonagold, and McIntosh), shall count as
depth of stock but shall not each be
counted as more than one staple food
variety for the purpose of determining
the number of varieties in any staple
food category except where explicitly
specified in Agency guidance.
Accessory foods shall not be counted as
staple foods for purposes of determining
eligibility to participate in SNAP as a
retail food store.
*
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Dated: March 28, 2019.
Brandon Lipps,
Acting Deputy Under Secretary, Food,
Nutrition, and Consumer Services.
[FR Doc. 2019–06597 Filed 4–4–19; 8:45 am]
BILLING CODE 3410–30–P
DEPARTMENT OF AGRICULTURE
3. Revise § 278.1(b)(1)(ii)(C) to read as
follows:
Commodity Credit Corporation
§ 278.1 Approval of retail food stores and
wholesale food concerns.
7 CFR Part 1423
■
The Paperwork Reduction Act of 1995
(44 U.S.C. Chap. 35; see 5 CFR part
1320) requires that the Office of
Management and Budget (OMB)
approve all collections of information
by a Federal agency from the public
before they can be implemented.
Respondents are not required to respond
to any collection of information unless
it displays a current valid OMB control
number. There is no information
collection burden associated with this
proposed rule.
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E-Government Act Compliance
FNS is committed to complying with
the E-Government Act of 2002, Public
Law 107–347, 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. FNS intends to
provide Program stakeholders with
guidance and technical assistance
materials related to this proposed rule
using online media.
*
*
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*
(b) * * *
(1) * * *
(ii) * * *
(C)(1) Offer a variety of staple foods
within each staple food category that
differ from each other by distinct main
ingredient or product kind. For
example: Apples, cabbage, tomatoes,
bananas, pumpkins, broccoli, and
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[Doc. No. AMS–FTPP–18–0085]
Delivery and Shipping Standards for
Cotton Warehouses
Commodity Credit Corporation,
USDA.
ACTION: Proposed rule.
AGENCY:
The U.S. Department of
Agriculture’s (USDA) Commodity Credit
SUMMARY:
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Federal Register / Vol. 84, No. 66 / Friday, April 5, 2019 / Proposed Rules
Corporation (CCC) proposes to amend
the regulations that specify the
requirements for CCC-approved
warehouses storing and handling cotton.
The amendment would change how
warehouse operators account for bales
made available for shipment (BMAS)
and how CCC determines BMAS
compliance. The current regulation
allows bales that are made available for
shipment by the warehouse operator but
not picked up (BNPU) by the shipper to
count for up to two reporting weeks
when calculating and reporting BMAS
for the reporting week. This amendment
proposes to limit BNPU to be counted
for one week, with BMAS to include
only bales actually shipped or not
picked up for that reporting week. CCC
also proposes to allow two additional
options for the warehouse operator to
meet the 4.5% cotton flow requirement
by averaging either the BMAS for the
reporting week and the week prior to
the reporting week, or by averaging the
BMAS for the reporting week and the
week after the reporting week. In
addition, CCC proposes to amend the
regulations to reflect the transfer of
warehouse programs and activities from
USDA’s Farm Service Agency to AMS in
2018.
DATES: Comments must be received by
May 6, 2019.
ADDRESSES: Comments should be
submitted electronically at
www.regulations.gov. Comments may
also be submitted to: Dan Schofer, AMS,
1400 Independence Ave. SW, Stop
3061, Room 2555 South Building,
Washington, DC 20250–3061.
Comments will be made available for
public inspection at Room 2530–S of the
above address during regular business
hours or electronically at
www.regulations.gov. Comments
received will be posted without change,
including any personal information
provided. All comments should
reference the docket number AMS–
FTPP–18–0085, the date of submission,
and the page number of this issue of the
Federal Register.
FOR FURTHER INFORMATION CONTACT: Dan
Schofer at dan.schofer@ams.usda.gov or
202–690–2434.
SUPPLEMENTARY INFORMATION: In order to
provide cotton warehouse operators the
flexibility to address real-time
scheduling changes and market
demands faced by cotton merchants and
shippers, CCC would use a two-week
rolling average of BMAS to determine a
warehouse operator’s compliance with
the minimum cotton flow rate of 4.5%
of applicable storage capacity.
For example, a cotton warehouse
operator has scheduled 4.5% of the
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warehouse’s applicable storage capacity
to be available for shipment for several
consecutive weeks. The week before a
load is scheduled to be picked-up, a
shipper requests to change its load out
date to an earlier load out date in the
preceding week, for an amount
representing 0.25% of the warehouse’s
applicable storage capacity. If the
warehouse operator has that specific
load (0.25% of licensed capacity)
already staged for a scheduled delivery
the following week, that load could be
picked up earlier, in the week preceding
the original load out date. Without using
a two-week rolling average and without
making any additional bale adjustments,
the warehouse operator would be
considered to have delivered cotton
without unnecessary delay for the first
week because its BMAS is 4.75%, which
is greater than the required 4.5%.
However, the warehouse operator would
not be considered to have delivered
cotton without unnecessary delay
during the second week because its
BMAS is 4.25%, which is less than he
required 4.5%. In this example, the
option to calculate BMAS compliance
using the rolling average of the reporting
week and the week preceding the
reporting week would result in a
determination by CCC that the cotton
warehouse operator is in compliance
with a BMAS of 4.5% for the reporting
week.
In another example, one that
illustrates the third option of meeting
the cotton flow requirement, a cotton
warehouse operator schedules 4.5% of
the applicable storage capacity for
delivery in each of three consecutive
weeks. During the first week, the cotton
warehouse operator actually makes
available for shipment 6.0% of the
applicable storage capacity. During the
second week, the cotton warehouse
operator only makes 2.0% of applicable
storage capacity available for shipment.
During the third week, the cotton
warehouse operator makes 7.0% of
applicable storage capacity available for
shipment. In this example, the cotton
warehouse operator is considered to
have delivered cotton without
unnecessary delay during the first and
the third weeks. During the second
week however, the CCC will use the
two-week rolling average of either the
applicable week and the immediately
preceding week, which results in an
average BMAS of 4.0%, or the two-week
rolling average of the applicable week
and the immediately succeeding week,
which results in an average BMAS of
4.5% to make its compliance
determination for the second week.
Using the two-week rolling average of
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the second and third week to calculate
the BMAS for the second week allows
the CCC to consider the cotton
warehouse operator to have delivered
cotton without unnecessary delay for
that second week because the 4.5%
average met the cotton flow
requirement.
This proposed rule change would
continue to require warehouse operators
to report their BMAS each week based
upon the revised definition of BMAS.
CCC would determine compliance on an
individual reporting week, or if needed,
use an option of one of the rolling
average calculations of BMAS for two
consecutive reporting weeks. In the
event that CCC uses the average of the
applicable week and the immediately
succeeding week, CCC would determine
compliance for the applicable week after
it receives the data from the
immediately succeeding week. These
options would allow cotton warehouse
operators to meet the cotton flow
requirements of the regulation while
being flexible to the needs of the
shipping and merchant industries.
Executive Orders 12866 and 13771, and
Initial Regulatory Flexibility Analysis
This rule does not meet the definition
of a significant regulatory action
contained in section 3(f) of Executive
Order 12866 and is not subject to review
by the Office of Management and
Budget (OMB). 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).
Pursuant to the requirements set forth
in the Regulatory Flexibility Act (RFA)
[5 U.S.C. 601 et seq.], CCC has
considered the economic effect of this
action on small entities and has
determined that this proposed rule
would not have a significant economic
impact on a substantial number of small
business entities. 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 burdened.
Currently, there are 326 CCCapproved warehouses that store cotton.
The U.S. Small Business
Administration’s Table of Small
Business Size Standards matched to the
North American Industry Classification
System (NAICS) Codes identifies small
business size by average annual receipts
or by the average number of employees
at a firm. This information can be found
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Federal Register / Vol. 84, No. 66 / Friday, April 5, 2019 / Proposed Rules
at 13 CFR parts 121.104, 121.106, and
121.201. CCC estimates that 50 CCCapproved warehouses that store cotton
would be considered small businesses
according to SBA standards.
Sizes of cotton warehouses vary in
size as well as business type, including
small, independent country warehouses,
small to large sized warehouses owned
by cooperatives of producers, and small
to large sized warehouses owned by
corporate shippers/merchants. The
effects of this proposed rule are not
expected to be disproportionately
greater or lesser for small businesses
than for large businesses.
USDA 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. Accordingly, CCC developed
options for companies requesting
service to do so electronically.
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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 effects on Tribal
governments and would not have
significant Tribal implications.
Executive Order 12988
This proposed rule has been reviewed
under Executive Order 12988, Civil
Justice Reform. This proposed rule is
not intended to have retroactive effect.
The USDA has not identified any
relevant Federal rules that duplicate,
overlap, or conflict with this proposed
rule.
The warehouse operator may resolve
any claim for noncompliance from any
entity, such as a merchant or shipper,
other than CCC with the cotton shipping
standard in a court of competent
jurisdiction or through mutually agreed
upon arbitration procedures. CCC does
not have authority to limit an entity
from filing suit in a court of law against
another entity.
The warehouse operator may request
that CCC reconsider adverse actions
when the warehouse operator
establishes that the reasons for the
action have been remedied or requests
reconsideration of the action.
Paperwork Reduction Act
The cotton information covered in
this proposed rule is the weekly
reporting of BMAS by cotton
warehouses. BMAS is reported through
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the Electronic Warehouse Receipt Inc.
(EWR Inc.) system, to which AMS has
access. EWR Inc. is a USDA licensed
provider company and generally
contains information that is exempt
from the Paperwork Reduction Act (44
U.S.C. Chapter 35) because it is usual
and customary business information.
The proposed change in the regulation
would not change the burden associated
with reporting BMAS, which is required
to be reported weekly.
Background and Proposed Revisions
AMS administers the CCC-approved
warehouse program for CCC. This
responsibility includes entering into
contracts for the storage and handling of
CCC-interest commodities with
warehouses. The operators of those
approved warehouses are required to
comply with CCC regulations, which
include reporting information about the
stored commodities to CCC. The specific
requirements that operators of approved
warehouses must meet are specified in
the regulations at § 7 CFR 1423
‘‘Commodity Credit Corporation
Approved Warehouses’’ and in the
signed storage agreement between CCC
and the warehouse operator for each
type of commodity.
Operators of CCC-approved cotton
warehouses are currently required to
report BMAS, among other data, to the
CCC on a weekly basis. Under the
current rule at § 7 CFR 1423.11(b)(1)(ii),
bales that were scheduled and ready for
delivery in a previous week, but not
picked up by the shipper, remained
available for loading and for which
another shipping date had not been
established could be counted toward
BMAS for up to two weeks. This
proposed rule would clarify that bales
scheduled and ready for delivery during
a week but not picked up by the end of
that reporting week can only be reported
as BMAS for that one week that such
bales were made available for shipment.
The National Cotton Council, on behalf
of the U.S. cotton industry, requested
this change in order to increase the
cotton flow rate to domestic and foreign
manufacturers, to more quickly respond
to domestic and international market
needs, and to optimize performance by
approved cotton warehouse operators.
This change is being made to simplify
the calculation of BMAS so that certain
bales do not need to be accounted for
beyond the applicable reporting week.
The proposed rule would change how
BNPU are counted in the weekly report
to CCC. It would not change any
warehouse tariffs or fees.
A conforming change would also be
made to CCC’s Cotton Storage
Agreement (Form CCC–823). The
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storage agreement is the agreement
between CCC and the cotton warehouse
operator on the requirements that the
warehouse operator must meet for
storing and handling CCC-interest
cotton. The standard cotton storage
agreement form and the subsequent
amendments are available on the USDA
website at: https://
forms.sc.egov.usda.gov//efcommon/
eFileServices/eForms/CCC823.PDF.
There is no expected cost to
warehouses or CCC of reporting BMAS
as specified in this proposed rule. The
proposed rule would only change how
bales made available but not picked up
by the shipper or merchant are reported
by the warehouse operator to CCC in the
weekly report. It does not change
warehouse tariffs or restocking fees.
This change is intended to improve
the efficiency of cotton flow from U.S.
producers and cotton warehouses to
shippers, and ultimately to cotton
manufacturers, by more accurately
reporting cotton that is available for
shipment. Under the current rule, it has
become apparent that certain bales may
have been scheduled and ready for
shipment but were never picked up for
two weeks or more, potentially inflating
BMAS calculations. This proposed rule
change is meant to more accurately
reflect how the cotton industry actually
makes bales available for shipment
during that one week. Availability and
consistent supply of cotton are crucial
for the U.S. cotton industry in order to
compete with other cotton producing
nations and having accurate information
about bales made available for shipment
contributes to more efficient and
effective marketing of U.S. cotton.
List of Subjects in 7 CFR Part 1423
Agricultural commodities, Cotton,
Honey, Oilseeds, Reporting and
recordkeeping requirements, Surety
bonds, Warehouses.
For the reasons stated in the
preamble, the Commodity Credit
Corporation proposes to amend 7 CFR
part 1423 as follows:
PART 1423—COMMODITY CREDIT
CORPORATION APPROVED
WAREHOUSES
1. The authority citation for part 1423
continues to read as follows:
■
Authority: 15 U.S.C. 714b and 714c.
2. Amend § 1423.2 by revising it to
read as follows:
■
§ 1423.2
Administration.
On behalf of CCC, the Agricultural
Marketing Service (AMS) will
administer this part under the
supervision of the AMS Administrator.
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Federal Register / Vol. 84, No. 66 / Friday, April 5, 2019 / Proposed Rules
3. Amend § 1423.3 by removing the
definition for ‘‘KCCO.’’
■ 4. Amend § 1423.7 by revising
paragraph (d) to read as follows:
■
7. Amend § 1423.13 by revising
paragraph (a) to read as follows:
§ 1423.7
(a) After initial approval, warehouse
operators may request that CCC
reconsider adverse actions when the
warehouse operator establishes that the
reasons for the action have been
remedied or requests reconsideration of
the action and presents to the Director,
Warehouse and Commodity
Management Division, AMS, in writing,
information in support of such request.
The warehouse operator may, if
dissatisfied with the Director’s
determination, obtain a review of the
determination and an informal hearing
by submitting a request to the AMS
Administrator. Appeals shall be as
prescribed in part 780 of this title, and
under such regulations the warehouse
operator shall be considered as a
‘‘participant.’’
*
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■
§ 1423.13 Appeals, suspensions, and
debarment.
Net Worth Alternatives.
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(d) Other alternative instruments and
forms of financial assurance as the AMS
Administrator determines appropriate to
secure the warehouse operator’s
compliance with this section.
■ 5. Amend § 1423.8 by revising
paragraph (b) to read as follows:
§ 1423.8
Approval or rejection.
*
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*
(b) CCC will notify the warehouse
operator of rejection under this part in
writing. The notification will state the
causes for rejection. CCC will reconsider
a warehouse for approval when the
warehouse operator establishes that the
reasons for rejection have been
remedied or requests reconsideration of
the action and presents to the Director,
Warehouse and Commodity
Management Division, AMS, in writing,
information in support of such request.
The warehouse operator may, if
dissatisfied with the Director’s
determination, obtain a review of the
determination and an informal hearing
by submitting a request with the AMS
Administrator. Appeals shall be as
prescribed in part 780 of this title.
■ 6. Amend § 1423.11 by revising
paragraphs (a)(2) and (b)(1) to read as
follows:
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§ 1423.11 Delivery and shipping standards
for cotton warehouses.
(a) * * *
(2) Be considered to have delivered
cotton without unnecessary delay if the
warehouse operator has made available
for shipment at least 4.5 percent of its
applicable storage capacity in effect,
measured as the BMAS:
(i) During the relevant week of
shipment, or
(ii) Calculated as the two-week,
rolling average of the BMAS for the
relevant week of shipment and the
BMAS for the immediately preceding
week, or
(iii) Calculated as the two-week,
rolling average of the BMAS for the
relevant week of shipment and the
BMAS for the immediately succeeding
week.
(b) * * *
(1) Bales made available for shipment
(BMAS) during such week is defined as
any cotton bales that have been
delivered or are scheduled and ready for
delivery but not picked up during such
week.
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Dated: April 2, 2019.
Robert Stephenson,
Executive Vice President, Commodity Credit
Corporation.
[FR Doc. 2019–06699 Filed 4–4–19; 8:45 am]
BILLING CODE 3410–02–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 25
[Docket No.: FAA–2019–0218; Notice No.
19–3]
RIN 2120–AL15
High Elevation Airport Operations
Federal Aviation
Administration (FAA), Department of
Transportation (DOT).
ACTION: Notice of proposed rulemaking
(NPRM).
AGENCY:
The FAA proposes to amend
certain airworthiness regulations
applicable to cabin pressurization
systems and oxygen dispensing
equipment on transport category
airplanes to accommodate airplane
operations into or out of airports with
elevations at or above 8,000 feet above
sea level. Currently, the FAA makes and
documents equivalent level of safety
findings when an airplane manufacturer
or modifier proposes to certify airplane
cabin pressurization systems used for
operations into or out of airports with
elevations at or above 8,000 feet. In
addition, the FAA grants exemptions
from the automatic oxygen mask
SUMMARY:
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13565
presentation requirements for
operations into or out of airports with
elevations at or above 14,000 feet. This
proposed action is necessary to relieve
the burden on industry and the FAA
that results from project-specific
equivalent level of safety (ELOS)
requests and petitions for exemption to
accommodate operations at high
elevation airports for transport category
airplanes.
DATES: Send comments on or before
June 4, 2019.
ADDRESSES: Send comments identified
by docket number FAA–2019–0218
using any of the following methods:
• Federal eRulemaking Portal: Go to
https://www.regulations.gov and follow
the online instructions for sending your
comments electronically.
• Mail: Send comments to Docket
Operations, M–30; U.S. Department of
Transportation (DOT), 1200 New Jersey
Avenue SE, Room W12–140, West
Building Ground Floor, Washington, DC
20590–0001.
• Hand Delivery or Courier: Take
comments to Docket Operations in
Room W12–140 of the West Building
Ground Floor at 1200 New Jersey
Avenue SE, Washington, DC, between 9
a.m. and 5 p.m., Monday through
Friday, except Federal holidays.
• Fax: Fax comments to Docket
Operations at 202–493–2251.
Privacy: In accordance with 5 U.S.C.
553(c), DOT solicits comments from the
public to better inform its rulemaking
process. DOT posts these comments,
without edit, including any personal
information the commenter provides, to
https://www.regulations.gov, as
described in the system of records
notice (DOT/ALL–14 FDMS), which can
be reviewed at https://www.dot.gov/
privacy.
Docket: Background documents or
comments received may be read at
https://www.regulations.gov at any time.
Follow the online instructions for
accessing the docket or go to the Docket
Operations in Room W12–140 of the
West Building Ground Floor at 1200
New Jersey Avenue SE, Washington,
DC, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
FOR FURTHER INFORMATION CONTACT: For
questions concerning this action,
contact Robert Hettman, Propulsion &
Mechanical Systems Section, AIR–672,
Transport Standards Branch, Policy and
Innovation Division, Aircraft
Certification Service, Federal Aviation
Administration, 2200 S 216th Street,
Des Moines, Washington 98198;
telephone and facsimile 206–231–3171;
email robert.hettman@faa.gov.
SUPPLEMENTARY INFORMATION:
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]]>Agencies
[Federal Register Volume 84, Number 66 (Friday, April 5, 2019)]
[Proposed Rules]
[Pages 13562-13565]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-06699]
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DEPARTMENT OF AGRICULTURE
Commodity Credit Corporation
7 CFR Part 1423
[Doc. No. AMS-FTPP-18-0085]
Delivery and Shipping Standards for Cotton Warehouses
AGENCY: Commodity Credit Corporation, USDA.
ACTION: Proposed rule.
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SUMMARY: The U.S. Department of Agriculture's (USDA) Commodity Credit
[[Page 13563]]
Corporation (CCC) proposes to amend the regulations that specify the
requirements for CCC-approved warehouses storing and handling cotton.
The amendment would change how warehouse operators account for bales
made available for shipment (BMAS) and how CCC determines BMAS
compliance. The current regulation allows bales that are made available
for shipment by the warehouse operator but not picked up (BNPU) by the
shipper to count for up to two reporting weeks when calculating and
reporting BMAS for the reporting week. This amendment proposes to limit
BNPU to be counted for one week, with BMAS to include only bales
actually shipped or not picked up for that reporting week. CCC also
proposes to allow two additional options for the warehouse operator to
meet the 4.5% cotton flow requirement by averaging either the BMAS for
the reporting week and the week prior to the reporting week, or by
averaging the BMAS for the reporting week and the week after the
reporting week. In addition, CCC proposes to amend the regulations to
reflect the transfer of warehouse programs and activities from USDA's
Farm Service Agency to AMS in 2018.
DATES: Comments must be received by May 6, 2019.
ADDRESSES: Comments should be submitted electronically at
www.regulations.gov. Comments may also be submitted to: Dan Schofer,
AMS, 1400 Independence Ave. SW, Stop 3061, Room 2555 South Building,
Washington, DC 20250-3061. Comments will be made available for public
inspection at Room 2530-S of the above address during regular business
hours or electronically at www.regulations.gov. Comments received will
be posted without change, including any personal information provided.
All comments should reference the docket number AMS-FTPP-18-0085, the
date of submission, and the page number of this issue of the Federal
Register.
FOR FURTHER INFORMATION CONTACT: Dan Schofer at
[email protected] or 202-690-2434.
SUPPLEMENTARY INFORMATION: In order to provide cotton warehouse
operators the flexibility to address real-time scheduling changes and
market demands faced by cotton merchants and shippers, CCC would use a
two-week rolling average of BMAS to determine a warehouse operator's
compliance with the minimum cotton flow rate of 4.5% of applicable
storage capacity.
For example, a cotton warehouse operator has scheduled 4.5% of the
warehouse's applicable storage capacity to be available for shipment
for several consecutive weeks. The week before a load is scheduled to
be picked-up, a shipper requests to change its load out date to an
earlier load out date in the preceding week, for an amount representing
0.25% of the warehouse's applicable storage capacity. If the warehouse
operator has that specific load (0.25% of licensed capacity) already
staged for a scheduled delivery the following week, that load could be
picked up earlier, in the week preceding the original load out date.
Without using a two-week rolling average and without making any
additional bale adjustments, the warehouse operator would be considered
to have delivered cotton without unnecessary delay for the first week
because its BMAS is 4.75%, which is greater than the required 4.5%.
However, the warehouse operator would not be considered to have
delivered cotton without unnecessary delay during the second week
because its BMAS is 4.25%, which is less than he required 4.5%. In this
example, the option to calculate BMAS compliance using the rolling
average of the reporting week and the week preceding the reporting week
would result in a determination by CCC that the cotton warehouse
operator is in compliance with a BMAS of 4.5% for the reporting week.
In another example, one that illustrates the third option of
meeting the cotton flow requirement, a cotton warehouse operator
schedules 4.5% of the applicable storage capacity for delivery in each
of three consecutive weeks. During the first week, the cotton warehouse
operator actually makes available for shipment 6.0% of the applicable
storage capacity. During the second week, the cotton warehouse operator
only makes 2.0% of applicable storage capacity available for shipment.
During the third week, the cotton warehouse operator makes 7.0% of
applicable storage capacity available for shipment. In this example,
the cotton warehouse operator is considered to have delivered cotton
without unnecessary delay during the first and the third weeks. During
the second week however, the CCC will use the two-week rolling average
of either the applicable week and the immediately preceding week, which
results in an average BMAS of 4.0%, or the two-week rolling average of
the applicable week and the immediately succeeding week, which results
in an average BMAS of 4.5% to make its compliance determination for the
second week. Using the two-week rolling average of the second and third
week to calculate the BMAS for the second week allows the CCC to
consider the cotton warehouse operator to have delivered cotton without
unnecessary delay for that second week because the 4.5% average met the
cotton flow requirement.
This proposed rule change would continue to require warehouse
operators to report their BMAS each week based upon the revised
definition of BMAS. CCC would determine compliance on an individual
reporting week, or if needed, use an option of one of the rolling
average calculations of BMAS for two consecutive reporting weeks. In
the event that CCC uses the average of the applicable week and the
immediately succeeding week, CCC would determine compliance for the
applicable week after it receives the data from the immediately
succeeding week. These options would allow cotton warehouse operators
to meet the cotton flow requirements of the regulation while being
flexible to the needs of the shipping and merchant industries.
Executive Orders 12866 and 13771, and Initial Regulatory Flexibility
Analysis
This rule does not meet the definition of a significant regulatory
action contained in section 3(f) of Executive Order 12866 and is not
subject to review by the Office of Management and Budget (OMB).
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).
Pursuant to the requirements set forth in the Regulatory
Flexibility Act (RFA) [5 U.S.C. 601 et seq.], CCC has considered the
economic effect of this action on small entities and has determined
that this proposed rule would not have a significant economic impact on
a substantial number of small business entities. 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 burdened.
Currently, there are 326 CCC-approved warehouses that store cotton.
The U.S. Small Business Administration's Table of Small Business Size
Standards matched to the North American Industry Classification System
(NAICS) Codes identifies small business size by average annual receipts
or by the average number of employees at a firm. This information can
be found
[[Page 13564]]
at 13 CFR parts 121.104, 121.106, and 121.201. CCC estimates that 50
CCC-approved warehouses that store cotton would be considered small
businesses according to SBA standards.
Sizes of cotton warehouses vary in size as well as business type,
including small, independent country warehouses, small to large sized
warehouses owned by cooperatives of producers, and small to large sized
warehouses owned by corporate shippers/merchants. The effects of this
proposed rule are not expected to be disproportionately greater or
lesser for small businesses than for large businesses.
USDA 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. Accordingly, CCC
developed options for companies requesting service to do so
electronically.
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 effects on Tribal governments and would not
have significant Tribal implications.
Executive Order 12988
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. This proposed rule is not intended to have
retroactive effect. The USDA has not identified any relevant Federal
rules that duplicate, overlap, or conflict with this proposed rule.
The warehouse operator may resolve any claim for noncompliance from
any entity, such as a merchant or shipper, other than CCC with the
cotton shipping standard in a court of competent jurisdiction or
through mutually agreed upon arbitration procedures. CCC does not have
authority to limit an entity from filing suit in a court of law against
another entity.
The warehouse operator may request that CCC reconsider adverse
actions when the warehouse operator establishes that the reasons for
the action have been remedied or requests reconsideration of the
action.
Paperwork Reduction Act
The cotton information covered in this proposed rule is the weekly
reporting of BMAS by cotton warehouses. BMAS is reported through the
Electronic Warehouse Receipt Inc. (EWR Inc.) system, to which AMS has
access. EWR Inc. is a USDA licensed provider company and generally
contains information that is exempt from the Paperwork Reduction Act
(44 U.S.C. Chapter 35) because it is usual and customary business
information. The proposed change in the regulation would not change the
burden associated with reporting BMAS, which is required to be reported
weekly.
Background and Proposed Revisions
AMS administers the CCC-approved warehouse program for CCC. This
responsibility includes entering into contracts for the storage and
handling of CCC-interest commodities with warehouses. The operators of
those approved warehouses are required to comply with CCC regulations,
which include reporting information about the stored commodities to
CCC. The specific requirements that operators of approved warehouses
must meet are specified in the regulations at Sec. 7 CFR 1423
``Commodity Credit Corporation Approved Warehouses'' and in the signed
storage agreement between CCC and the warehouse operator for each type
of commodity.
Operators of CCC-approved cotton warehouses are currently required
to report BMAS, among other data, to the CCC on a weekly basis. Under
the current rule at Sec. 7 CFR 1423.11(b)(1)(ii), bales that were
scheduled and ready for delivery in a previous week, but not picked up
by the shipper, remained available for loading and for which another
shipping date had not been established could be counted toward BMAS for
up to two weeks. This proposed rule would clarify that bales scheduled
and ready for delivery during a week but not picked up by the end of
that reporting week can only be reported as BMAS for that one week that
such bales were made available for shipment. The National Cotton
Council, on behalf of the U.S. cotton industry, requested this change
in order to increase the cotton flow rate to domestic and foreign
manufacturers, to more quickly respond to domestic and international
market needs, and to optimize performance by approved cotton warehouse
operators. This change is being made to simplify the calculation of
BMAS so that certain bales do not need to be accounted for beyond the
applicable reporting week. The proposed rule would change how BNPU are
counted in the weekly report to CCC. It would not change any warehouse
tariffs or fees.
A conforming change would also be made to CCC's Cotton Storage
Agreement (Form CCC-823). The storage agreement is the agreement
between CCC and the cotton warehouse operator on the requirements that
the warehouse operator must meet for storing and handling CCC-interest
cotton. The standard cotton storage agreement form and the subsequent
amendments are available on the USDA website at: https://forms.sc.egov.usda.gov//efcommon/eFileServices/eForms/CCC823.PDF.
There is no expected cost to warehouses or CCC of reporting BMAS as
specified in this proposed rule. The proposed rule would only change
how bales made available but not picked up by the shipper or merchant
are reported by the warehouse operator to CCC in the weekly report. It
does not change warehouse tariffs or restocking fees.
This change is intended to improve the efficiency of cotton flow
from U.S. producers and cotton warehouses to shippers, and ultimately
to cotton manufacturers, by more accurately reporting cotton that is
available for shipment. Under the current rule, it has become apparent
that certain bales may have been scheduled and ready for shipment but
were never picked up for two weeks or more, potentially inflating BMAS
calculations. This proposed rule change is meant to more accurately
reflect how the cotton industry actually makes bales available for
shipment during that one week. Availability and consistent supply of
cotton are crucial for the U.S. cotton industry in order to compete
with other cotton producing nations and having accurate information
about bales made available for shipment contributes to more efficient
and effective marketing of U.S. cotton.
List of Subjects in 7 CFR Part 1423
Agricultural commodities, Cotton, Honey, Oilseeds, Reporting and
recordkeeping requirements, Surety bonds, Warehouses.
For the reasons stated in the preamble, the Commodity Credit
Corporation proposes to amend 7 CFR part 1423 as follows:
PART 1423--COMMODITY CREDIT CORPORATION APPROVED WAREHOUSES
0
1. The authority citation for part 1423 continues to read as follows:
Authority: 15 U.S.C. 714b and 714c.
0
2. Amend Sec. 1423.2 by revising it to read as follows:
Sec. 1423.2 Administration.
On behalf of CCC, the Agricultural Marketing Service (AMS) will
administer this part under the supervision of the AMS Administrator.
[[Page 13565]]
0
3. Amend Sec. 1423.3 by removing the definition for ``KCCO.''
0
4. Amend Sec. 1423.7 by revising paragraph (d) to read as follows:
Sec. 1423.7 Net Worth Alternatives.
* * * * *
(d) Other alternative instruments and forms of financial assurance
as the AMS Administrator determines appropriate to secure the warehouse
operator's compliance with this section.
0
5. Amend Sec. 1423.8 by revising paragraph (b) to read as follows:
Sec. 1423.8 Approval or rejection.
* * * * *
(b) CCC will notify the warehouse operator of rejection under this
part in writing. The notification will state the causes for rejection.
CCC will reconsider a warehouse for approval when the warehouse
operator establishes that the reasons for rejection have been remedied
or requests reconsideration of the action and presents to the Director,
Warehouse and Commodity Management Division, AMS, in writing,
information in support of such request. The warehouse operator may, if
dissatisfied with the Director's determination, obtain a review of the
determination and an informal hearing by submitting a request with the
AMS Administrator. Appeals shall be as prescribed in part 780 of this
title.
0
6. Amend Sec. 1423.11 by revising paragraphs (a)(2) and (b)(1) to
read as follows:
Sec. 1423.11 Delivery and shipping standards for cotton warehouses.
(a) * * *
(2) Be considered to have delivered cotton without unnecessary
delay if the warehouse operator has made available for shipment at
least 4.5 percent of its applicable storage capacity in effect,
measured as the BMAS:
(i) During the relevant week of shipment, or
(ii) Calculated as the two-week, rolling average of the BMAS for
the relevant week of shipment and the BMAS for the immediately
preceding week, or
(iii) Calculated as the two-week, rolling average of the BMAS for
the relevant week of shipment and the BMAS for the immediately
succeeding week.
(b) * * *
(1) Bales made available for shipment (BMAS) during such week is
defined as any cotton bales that have been delivered or are scheduled
and ready for delivery but not picked up during such week.
* * * * *
0
7. Amend Sec. 1423.13 by revising paragraph (a) to read as follows:
Sec. 1423.13 Appeals, suspensions, and debarment.
(a) After initial approval, warehouse operators may request that
CCC reconsider adverse actions when the warehouse operator establishes
that the reasons for the action have been remedied or requests
reconsideration of the action and presents to the Director, Warehouse
and Commodity Management Division, AMS, in writing, information in
support of such request. The warehouse operator may, if dissatisfied
with the Director's determination, obtain a review of the determination
and an informal hearing by submitting a request to the AMS
Administrator. Appeals shall be as prescribed in part 780 of this
title, and under such regulations the warehouse operator shall be
considered as a ``participant.''
* * * * *
Dated: April 2, 2019.
Robert Stephenson,
Executive Vice President, Commodity Credit Corporation.
[FR Doc. 2019-06699 Filed 4-4-19; 8:45 am]
BILLING CODE 3410-02-P
