Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order; Change in Membership, Nominations, Procedures, and Continuance Referenda Period, 50294-50301 [2019-20291]
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Federal Register / Vol. 84, No. 186 / Wednesday, September 25, 2019 / Rules and Regulations
Second, the commenter asked AMS to
remove ‘‘germ damage’’ from the
definition of Damaged Kernels in the
Regulations, stating: ‘‘There is not a
germ location on a soybean, instead the
area where the sprout protruded from
the soybean is called the ‘‘hilum.’’ AMS
agrees that there is no ‘‘germ’’ in
soybeans. However, the hilum is not
where a sprout emerges from the
seedcoat, rather, the hilum is the point
of attachment of the seed to the pod.
AMS has no instruction, however, for
assessing germ damage in soybeans,
thus AMS inspectors never assesses
germ damage. Third, the commenter
recommend AMS change the term
‘‘Interpretive Line Picture’’ to
‘‘Interpretive Line Print.’’ AMS agrees
that a technical correction would be
appropriate to clarify the regulations on
germ inspection and ‘‘Interpretative
Line Picture.’’ AMS plans a subsequent
rulemaking to addresses technical
corrections throughout the Regulations.
Accordingly, AMS will not pursue
amendment of the U.S. Standards for
Soybeans and the U.S. Standards for
Corn at this time.
Authority: USGSA (7 U.S.C. 71–87k).
Dated: September 16, 2019.
Bruce Summers,
Administrator, Agricultural Marketing
Service.
[FR Doc. 2019–20295 Filed 9–24–19; 8:45 am]
BILLING CODE 3410–02–P
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1217
[Document Number AMS–SC–19–0015]
Softwood Lumber Research,
Promotion, Consumer Education and
Industry Information Order; Change in
Membership, Nominations,
Procedures, and Continuance
Referenda Period
Agricultural Marketing Service.
Final rule.
AGENCY:
ACTION:
This rule changes the
membership, nominations, procedures,
and continuance referenda period for
the Softwood Lumber Board (Board)
established under the Softwood Lumber
Research, Promotion, Consumer
Education and Industry Information
Order (Order). The Board administers
the Order with oversight by the U.S.
Department of Agriculture (USDA). This
action will also make administrative
changes to other provisions of the
Order.
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SUMMARY:
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DATES:
Effective Date: October 25, 2019.
FOR FURTHER INFORMATION CONTACT:
Andrea Ricci, Marketing Specialist,
Promotion and Economics Division,
Specialty Crops Program, AMS, USDA,
1400 Independence Avenue SW, Room
1406–S, Washington, DC 20250;
telephone: (202) 572–1442; facsimile
(202) 205–2800; or electronic mail:
Andrea.Ricci@usda.gov.
SUPPLEMENTARY INFORMATION: This rule
affecting 7 CFR part 1217 (the Softwood
Lumber Research, Promotion, Consumer
Education and Industry Information
(Order)) is authorized under the
Commodity Promotion, Research, and
Information Act of 1996 (1996 Act) (7
U.S.C. 7411–7425).
Executive Orders 12866, 13563, and
13771
Executive Orders 12866 and 13563
direct agencies to assess all costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts and equity).
Executive Order 13563 emphasizes the
importance of quantifying both costs
and benefits, reducing costs,
harmonizing rules and promoting
flexibility. This action falls within a
category of regulatory actions that the
Office of Management and Budget
(OMB) exempted from Executive Order
12866 review. Additionally, because
this rule does not meet the definition of
a significant regulatory action it does
not trigger the requirements contained
in Executive Order 13771. See OMB’s
Memorandum titled ‘‘Interim Guidance
Implementing Section 2 of the Executive
Order of January 30, 2017, titled
‘Reducing Regulation and Controlling
Regulatory Costs’’’ (February 2, 2017).
Executive Order 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 rule has been reviewed under
Executive Order 12988, Civil Justice
Reform. It is not intended to have
retroactive effect. Section 524 of the
1996 Act (7 U.S.C. 7423) provides that
it shall not affect or preempt any other
Federal or State law authorizing
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promotion or research relating to an
agricultural commodity.
Pursuant to the Congressional Review
Act (5 U.S.C. 801 et seq.), the Office of
Information and Regulatory Affairs
designated this rule as not a major rule,
as defined by 5 U.S.C. 804(2).
Under section 519 of the 1996 Act (7
U.S.C. 7418), a person subject to an
order may file a written petition with
USDA stating that an order, any
provision of an order, or any obligation
imposed in connection with an order, is
not established in accordance with the
law, and request a modification of an
order or an exemption from an order.
Any petition filed challenging an order,
any provision of an order, or any
obligation imposed in connection with
an order, shall be filed within two years
after the effective date of an order,
provision, or obligation subject to
challenge in the petition. The petitioner
will have the opportunity for a hearing
on the petition. Thereafter, USDA will
issue a ruling on the petition. The 1996
Act provides that the district court of
the United States for any district in
which the petitioner resides or conducts
business shall have the jurisdiction to
review a final ruling on the petition, if
the petitioner files a complaint for that
purpose not later than 20 days after the
date of the entry of USDA’s final ruling.
Background
This rule changes the Board’s
membership, nominations, procedures,
and continuance referenda period under
the Order. The Board administers the
Order with oversight by USDA. Under
the Order, assessments are collected
from manufacturers and importers and
used for projects to promote softwood
lumber within the United States. This
rule reduces the number of Board
members from 19 to 14, revises the
nomination procedures, and revises the
quorum and voting procedures. This
rule also revises the time frame for
periodic continuance referenda from
five to seven years. Finally, this rule
makes clarifying and conforming
changes to other provisions of the
Order. All of these changes will help
facilitate program operations and were
recommended to the Secretary by the
Board at its November 28, 2018 meeting.
Board Membership and Geographical
Distribution
Pursuant to § 1217.40(b), the Board is
composed of 18 or 19 members,
depending upon whether an additional
importer member is appointed to the
Board. Seats on the Board are
apportioned based on the volume of
softwood lumber manufactured and
shipped within the United States by
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domestic manufacturers and the volume
of softwood lumber imported into the
United States. Seats are also
apportioned based on size of operation
within each geographic region as
specified herein. Large manufacturers
are those who account for the top twothirds of the total annual volume of
assessable softwood lumber and small
manufacturers are those who account
for the remaining one-third of the total
annual volume of assessable softwood
lumber, based on a three-year average.
Table 1 shows the current structure of
the Board. Of the 19 total Board seats,
12 are held by domestic manufacturers
and seven are held by importers, six of
whom are Canadian. Of the 12 domestic
manufacturers, six represent the U.S.
South (two large and four small), five
represent the U.S. West (four large and
one small), and one represents the
Northeast and Lake States. Of the six
Canadian importers, four represent
Canada West (three large and one small)
and two represent Canada East (one
large and one small). An additional
importer member may be appointed to
represent all other importing countries
other than Canada.
Section 1217.40(c)(1) requires that, in
each five-year period, the Board review,
based on a three-year average, the
geographical distribution of the volume
of softwood lumber manufactured and
shipped within the United States by
domestic manufacturers and the volume
of softwood lumber imported into the
United States. Section 1217.40(c)(2)
requires that the Board also review,
based on a three-year average, the
distribution of the size of operations
within each region. Section
1217.40(c)(3) specifies that, if
warranted, the Board may recommend
to the Secretary the reapportionment of
its membership to reflect changes in the
geographical distribution of the volume
of softwood lumber manufactured and
shipped within the United States by
domestic manufacturers and the volume
of softwood lumber imported into the
United States. The number of Board
members may also be changed. Any
changes in Board composition shall be
implemented by the Secretary through
rulemaking.
Pursuant to § 1217.40, the Board
evaluated the geographic distribution of
softwood lumber by region, based on a
three-year average (2015–2017). The
Board utilized data from Forest
Economic Advisors 1 to evaluate the
regional distribution of assessable
softwood lumber. The results of this
evaluation are shown in Table 2. Based
on a three-year average (2015–2017), the
volume of assessed softwood lumber
was largest in the U.S. South and U.S.
West regions, at 36 percent and 30
percent, respectively, of the total
assessed volume over all regions.
Canada West followed with 20 percent
of the total assessed volume. In these
three regions, assessed volume by large
entities made up the majority of
assessed regional volume. In all other
regions, assessed volume by small
entities was either equal to or greater
than the assessed volume by large
entities.
1 Forest Economic Advisors, LLC. FEA is an
owner-operated company comprised of experienced
and informed analysts covering the forest products
industry. FEA applies rigorous economic analysis
and delivers actionable information though their
third-party forecasts and monthly advisors.
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Federal Register / Vol. 84, No. 186 / Wednesday, September 25, 2019 / Rules and Regulations
From this evaluation, the Board
recommended revising the Board
membership from 19 current seats to 14
seats for the 2021 term of office, of
which six members must represent large
manufacturers or importers, four must
represent small manufacturers or
importers, and four may represent any
size manufacturers or importers. Of the
four representing any size manufacturer
or importer, at least two of these
members must represent small
manufacturers or importers. The Board
recommended adding more flexibility to
the Order in terms of certain seats being
open to representatives of any size
manufacturer or importer. This will
allow the Board to better adjust in the
future to shifts in the size of operations
within a region.
The Board also took into
consideration the consolidation in the
softwood lumber industry since the
inception of the Order. The Board has
indicated that the number of companies
eligible to be represented on the Board
has declined. According to the Board,
there were about 290 entities eligible to
be represented on the Board in 2013,
and about 210 entities in 2018. The
Board has faced challenges securing
enough nominees for membership on
the Board. This compelled the Board to
consider a reduction in Board
membership.
The Board seats are revised as
follows: Ten domestic manufacturers
seats, of which five members must be
from the U.S. South Region (two large,
two small, and one manufacturer of any
size), four members must be from the
U.S. West Region (two large, one small,
and one manufacturer of any size), and
one member from the Northeast and
Lake States Region. Importers will have
four seats on the Board (two large, one
small, and one importer of any size)
with a minimum of two from Canada
West Region, a minimum of one from
Canada East Region and the remaining
member may be from Canada West,
Canada East or offshore Regions. Table
3 illustrates this categorization of seats
in the revised Board structure.
As the Board conducted the
evaluation pursuant to § 1217.40, it also
made a recommendation to align
§ 1217.40(a) and (c)(1) and (3) with
section 515(b)(3) of the 1996 Act. (7
U.S.C. 7414(b)(3)). Section 1217.40(a)
clarifies that the Board shall be
apportioned based on the volume of
softwood lumber production that is
manufactured and shipped within the
United States by domestic
manufacturers. Section 1217.40(c)(1)
and (3), respectively, specify that the
Board shall review, based on a three-
year average, the geographical
distribution of the volume of softwood
lumber produced and shipped within
the United States by domestic
manufacturers, and that the Board shall
make recommendations to revise its
structure based on this review.
Additionally, the Board
recommended that U.S. Board members
reside in the region they represent. This
will ensure that entities from outside
the U.S. that own softwood lumber
entities within the U.S. could represent
a U.S. region on the Board only if the
individual seeking nomination resides
in the respective region. The Board will
review the USDA Advisory Committee
on Research and Promotion Background
Information Form AD–755 to determine
in which Region each nominee resides.
According to the Board, this action
should make the reduced number of
seats easier to fill and reflect the current
distribution of the industry.
The Board recommended a
transitional approach to reduce the
Board from 19 members to 14 members
over a three-year period. The 2019
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Board currently has 19 members. The
2020 Board will have 16 members
consisting of five domestic
manufacturer members representing the
U.S. South Region (two large and three
small), five representing the U.S. West
Region (four large and one small) and
one representing the Northeast and Lake
States. Of the five Canadian importers
(three large and two small), there will be
three from the Canada West Region and
two from the Canada East Region. The
non-Canadian importer seat will not be
filled in 2020 (when the current member
reaches tenure).
The 2021 Board will have 14 members
consisting of five domestic
manufacturer members representing the
U.S. South Region (two large, two small
and one manufacturer of any size), four
members representing the U.S. West
Region (two large, one small and one
manufacturer of any size) and one
representing the Northeast and Lake
States. Of the four Canadian importers
(two large, one small and one importer
of any size), there will be two from the
Canada West Region and one from the
Canada East Region. The remaining
member may be from Canada West,
Canada East or offshore Regions.
Nomination Procedures
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Section 1217.41 establishes the
procedures for the conduct of
nominations to obtain Board nominees
for appointment by the Secretary. The
Board recommended to remove the
procedures in § 1217.41(a) regarding the
initial nominations to select the
nominees for the initial Board in 2011.
Section 1217.41(b) establishes an
election process for nominations. In
order to secure more nominees for
Board seats, the Board recommended
removing the election process from its
nomination procedures.
The nomination procedure provides
that the Board conduct outreach and
solicit nominees who are interested in
serving on the Board. A nominee could
seek nomination to the Board for all
seats for which he or she is qualified.
The Board will evaluate all nominees
and submit one recommended
candidate for each open seat and one
additional nominee for each open seat
to the Secretary for consideration. Other
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qualified persons interested in serving
in the open seats but not recommended
by the Board will be designated as other
nominees for consideration by the
Secretary. From the nominations made,
the Secretary would appoint members of
the Board.
Finally, the Board recommended a
clarification to § 1217.41(b)(7) that
specifies no two members shall be
employed by a single corporation,
company, partnership, or any other legal
entity, includes subsidiaries and
affiliates thereof. Section 1217.41 will
be revised accordingly.
Quorum and Voting Procedures
Section 1217.44 specifies the quorum
and voting procedures for the Board
based on the current 19 Board members.
The Board’s recommendation is to
revise these provisions from specific
number requirements needed for a
quorum and for votes to a general term
‘‘majority’’ that could apply to any size
Board. Thus, the Board recommended
these conforming changes to
complement the reduction in Board
membership. Section 1217.44 will be
revised accordingly.
Continuance Referenda Period
Section 1217.81(b) specifies that the
Secretary conduct a referendum of the
industry for the purpose of ascertaining
whether manufacturers for the U.S.
market favor the continuation of the
Order. The first continuance referendum
was held in 2018, and 78 percent of the
voters representing 94 percent of the
volume voted supported continuance of
the Order. The Board recommended that
the period between referenda be
extended from five to seven years for the
purpose of efficiency. The Board would
incur costs associated with referenda
once every seven years rather than every
five years. The Order would still permit
referenda to be held at the request of the
Board; at the request of 10 percent or
more of the number of persons eligible
to vote in a referendum; and at any time
as determined by the Secretary,
pursuant to § 1217.81(b)(3), (4) and (5),
respectively. Section 1217.81(b) will be
revised accordingly.
This rule also makes minor changes to
§§ 1217.52(h) and 1217.101(l), by
updating the Harmonized Tariff
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Schedule (HTS) number codes. The HTS
number codes are periodically updated
by the United States Internal Trade
Commission. Finally, this rule changes
the OMB control number assigned to the
previously approved information
collection referenced in §§ 1217.88 and
1217.108 from 0581–0264 to 0581–0093,
the correct control number assigned by
OMB.
Final Regulatory Flexibility Act
Analysis
In accordance with the Regulatory
Flexibility Act (RFA) (5 U.S.C. 601–
612), AMS is required to examine the
impact of the rule on small entities.
Accordingly, AMS has considered the
economic impact of this action on such
entities.
The purpose of the RFA is to fit
regulatory actions to the scale of
businesses subject to such actions so
that small businesses will not be
disproportionately burdened. The Small
Business Administration (SBA) defines,
in 13 CFR part 121, small agricultural
service firms (domestic manufacturers
and importers) as those having annual
receipts of no more than $7.5 million.2
The Random Lengths yearly average
framing lumber composite price was
$460 per thousand board feet in 2018.3
Dividing the $7.5 million threshold that
defines an agricultural service firm as
small by this price results in a
maximum threshold of 16.3 million
board feet (mmbf) of softwood lumber
per year that a domestic manufacturer or
importer may ship to be considered a
small entity for purposes of the RFA.
Table 4 shows the number of entities
and the amount of volume they
represent that may be categorized as
small or large based on the SBA
definition.
2 SBA does have a small business size standard
for ‘‘Sawmills’’ of 500 employees (see https://
www.sba.gov/sites/default/files/files/Size_
Standards_Table.pdf). Based on USDA’s
understanding of the lumber industry, using this
criterion would be impractical as sawmills often
use contractors rather than employees to operate
and, therefore, many mills would fall under this
criterion while being, in reality, a large business.
Therefore, USDA used agricultural service firm as
a more appropriate criterion for this analysis.
3 Random Lengths Publications, Inc.;
www.randomlengths.com.
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As shown in Table 4, there were a
total of 1,383 domestic manufacturers
and importers of softwood lumber based
on 2018 data. Of these, 931 entities, or
67 percent, shipped or imported less
than 16.3 mmbf and would be small
entities under the SBA definition. These
931 entities domestically manufactured
or imported 2.07 billion board feet (bbf)
in 2018, less than 3 percent of total
volume. The reduction in Board seats
and other administrative changes will
not disproportionately burden small
domestic manufacturers and importers
of softwood lumber.
This rule revises the Board’s
membership, nominations, procedure,
and continuance referenda period
provisions under the Order. Section
1217.40 is revised to reduce the number
of Board members from 19 to 14 and
reflects the diversity of the industry in
terms of geographical distribution and
size of operation. An additional change
to this section requires that U.S. Board
members reside in the region they
represent. Section 1217.41 is revised by
eliminating the election process in the
nomination procedures. In § 1217.44 the
quorum and voting procedures for the
Board are revised to complement the
reduction in Board membership. Section
1217.81 is revised to instruct that
subsequent continuance referenda to be
conducted every seven years rather than
five. These changes were recommended
by the Board and are authorized under
§§ 1217.40(c)(3), 1217.41(b)(8),
1217.46(b), and 1217.87 of the Order
and section 515(b)(3) of the 1996 Act.
Regarding the economic impact of this
rule on affected entities, these changes
are administrative in nature and would
have no economic impact on entities
covered under the program. These
changes will help in securing nominees
to fill seats on the Board, address the
concerns of the softwood lumber
industry not securing enough nominees
to be submitted to the Secretary for
selection, make conforming changes
necessary to complement the reduction
in Board membership, and improve
efficiency regarding continuance
referenda.
The Board’s Industry Relations and
Governance Committee (Committee)
reviewed various alternatives to the
Board’s current 19-member make-up.
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The Committee considered a 12 and 13member Board. The committee also
considered maintaining the status quo at
19 members. Regarding the referenda
period, one option the Board considered
was to maintain the status quo.
However, the Board recommended
changing the period from five to seven
years to improve the operating
efficiency of the Board.
Reporting and Recordkeeping
Requirements
In accordance with the Paperwork
Reduction Act of 1995 (44 U.S.C.
Chapter 35), the Order’s information
collection and recordkeeping
requirements have been approved
previously under OMB control number
0581–0093. This rule does not result in
a change to the information collection
and recordkeeping requirements
previously approved and does not
impose additional reporting
requirements or recordkeeping burden
on domestic manufacturers and
importers of softwood lumber.
As with all Federal promotion
programs, reports and forms are
periodically reviewed to reduce
information requirements and
duplication by industry and publicsector agencies. USDA has not
identified any relevant Federal rules
that duplicate, overlap, or conflict with
this rule.
Regarding outreach efforts, the actions
were discussed by the Board’s Industry
Relations and Governance Committee at
meetings on May 30, 2018, August 15,
2018, and October 26, 2018. The full
Board discussed outreach efforts at
meetings on May 31, 2018, August 15,
2018. The Board then made its
recommendation to the Secretary on
November 28, 2018. All of the Board’s
meetings, including meetings held via
teleconference, are open to the public
and interested persons are invited to
participate and express their views.
A proposed rule concerning this
action was published in the Federal
Register on June 26, 2019 (84 FR 30040).
A 30-day comment period ending July
26, 2019, was provided to allow
interested persons to submit comments.
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Analysis of Comments
Fifteen comments were received in
response to the proposed rule. Thirteen
comments supported all the Board
recommended changes. Two comments
were considered outside the scope of
this action. In summary, most
commenters agreed that reducing the
size of the Board is appropriate due to
industry consolidation, resulting in
fewer individuals eligible to serve. One
commenter noted that the reduced size
would allow the Board to administer the
program more efficiently and would
help streamline business operations. In
addition, one commenter supported the
proposed approach to the geographic
distribution, stating that it allows for
fair and appropriate representation of all
segments of the industry. Thirteen
commenters supported the proposed
change to the nomination procedures
noting that allowing the Board to
conduct outreach and recommend
nominees to the Secretary is a more
acceptable process for the industry.
Lastly, the commenters agreed that
extending the period between
conducting continuance referenda from
five to seven years was in the best
interest of the program. It not only
reduces the cost to the industry and
provides a more efficient process, but it
allows the Board to focus on its program
areas of research and promotion of
softwood lumber.
After consideration of all relevant
material presented, including the
information and recommendations
submitted by the Board, the comments
received, and other available
information, it is hereby found that this
rule, as hereinafter set forth, is
consistent with and will effectuate the
purposes of the 1996 Act.
List of Subjects in 7 CFR Part 1217
Administrative practice and
procedure, Advertising, Consumer
information, Marketing agreements,
Reporting and recordkeeping
requirements, Softwood Lumber
promotion.
For the reasons set forth in the
preamble, 7 CFR part 1217 is amended
as follows:
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PART 1217—SOFTWOOD LUMBER
RESEARCH, PROMOTION,
CONSUMER EDUCATION AND
INDUSTRY INFORMATION ORDER
1. The authority citation for 7 CFR
part 1217 continues to read as follows:
■
Authority: 7 U.S.C. 7411–7425; 7 U.S.C.
7401.
■
2. Revise § 1217.40 to read as follows:
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§ 1217.40
Establishment and membership.
(a) Establishment of the Board. There
is hereby established a Softwood
Lumber Board to administer the terms
and provisions of the Order and
promote the use of softwood lumber.
The Board shall be composed of
manufacturers for the U.S. market who
manufacture and domestically ship or
import 15 million board feet or more of
softwood lumber in the United States
during a fiscal period. Seats on the
Board shall be apportioned based on the
volume of softwood lumber production
that is manufactured and shipped
within the United States by domestic
manufacturers and the volume of
softwood lumber imported into the
United States. Seats on the Board shall
also be apportioned based on size of
operation within each geographic
region, as specified in paragraphs
(b)(1)(i) and (ii) and (b)(2) and (3) of this
section. For purposes of this section,
‘‘large’’ means manufacturers for the
U.S. market who account for the top
two-thirds of the total annual volume of
assessable softwood lumber and ‘‘small’’
means those who account for the
remaining one-third of the total annual
volume of assessable softwood lumber.
If there are no eligible nominees for a
large or small seat within a region, that
seat may be filled by a nominee
representing an eligible manufacturer
for the U.S. market of any size. Should
the size of a manufacturer for the U.S.
market change during a member’s term
of office, that member may serve for the
remainder of the term.
(b) Composition of the Board. The
2020 Board shall be composed of 16
members. The 2021 Board and each
subsequent Board shall be composed of
14 members. The Board shall be
established as follows:
(1) Domestic manufacturers. For the
2020 Board, 11 members shall represent
domestic manufacturers and for the
2021 Board and each subsequent Board,
ten members shall represent domestic
manufacturers who reside in the
following three regions:
(i) Five members shall reside in the
U.S. South Region, which consists of the
states of Alabama, Arkansas, Florida,
Georgia, Louisiana, Mississippi, North
Carolina, Oklahoma, South Carolina,
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15:54 Sep 24, 2019
Jkt 247001
Tennessee, Texas, Virginia, and West
Virginia. For the 2020 Board, of these
five members, two must represent large
and three must represent small domestic
manufacturers. For the 2021 Board and
each subsequent Board of these five
members, two must represent large, two
must represent small, and one may
represent domestic manufacturers of
any size;
(ii) Five members shall reside in the
U.S. West Region for the 2020 Board,
and for the 2021 Board and each
subsequent Board, four members shall
reside in the U.S. West Region, which
consists of the states of Alaska, Arizona,
California, Colorado, Hawaii, Idaho,
Montana, Nevada, New Mexico, North
Dakota, Oregon, South Dakota, Utah,
Washington, and Wyoming. For the
2020 Board, of these five members, four
must represent large and one must
represent small domestic manufacturers.
For the 2021 Board and each subsequent
Board, of the four members, two must
represent large, one must represent
small, and one may represent domestic
manufacturers of any size; and
(iii) One member shall reside in the
Northeast and Lake States Region,
which consists of the states of
Connecticut, Delaware, Illinois, Indiana,
Iowa, Kansas, Kentucky, Maine,
Maryland, Massachusetts, Michigan,
Minnesota, Missouri, Nebraska, New
Hampshire, New Jersey, New York,
Ohio, Pennsylvania, Rhode Island,
Vermont, Wisconsin and all other parts
of the United States not listed in
paragraph (b)(1)(i), (ii), or (iii) of this
section. This member may represent
domestic manufacturers of any size.
(iv) For the 2021 Board, four members
may represent a manufacturer for the
U.S. market of any size.
(2) Importers for the 2020 Board. Five
members shall be importers from the
following two regions:
(i) Three members must import
softwood lumber from the Canadian
West Region, which consists of the
provinces of British Columbia and
Alberta. Of these three members, two
must represent large and one must
represent small importers; and
(ii) Two members must import
softwood lumber from the Canadian
East Region, which consists of the
Canadian territories and all other
Canadian provinces not listed in
paragraph (b)(2)(i) of this section that
import softwood lumber into the United
States. Of these two members, one must
represent large and one must represent
small importers.
(3) Importers for the 2021 Board and
each subsequent Board. Four members
shall represent importers. Of these four
members, two must represent large, one
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Sfmt 4700
50299
must represent small, and one may
represent importers of any size. At least
three of these members must import
softwood lumber from the following
regions:
(i) Two members must import
softwood lumber from the Canadian
West Region, as defined in paragraph
(b)(2)(i) of this section; and
(ii) One member must import
softwood lumber from the Canadian
East Region, as defined in paragraph
(b)(2)(ii) of this section.
(c) Periodic review. In each five-year
period, but not more frequently than
once in each three-year period, the
Board shall:
(1) Review, based on a three-year
average, the geographical distribution of
the volume of softwood lumber
production that is manufactured and
shipped within the United States by
domestic manufacturers and the volume
of softwood lumber imported into the
United States; and
(2) Review, based on a three-year
average, the distribution of the size of
operations within each region; and
(3) If warranted, recommend to the
Secretary the reapportionment of the
Board membership to reflect changes in
the geographical distribution of the
volume of softwood lumber production
that is manufactured and shipped
within the United States by domestic
manufacturers and the volume of
softwood lumber imported into the
United States. The distribution of
volumes between regions and the
distribution of the size of operations
within regions shall also be considered.
The number of Board members may also
be changed. Any changes in Board
composition shall be implemented by
the Secretary through rulemaking.
■ 3. Revise § 1217.41 to read as follows:
§ 1217.41
Nominations and appointments.
Nominations shall be conducted as
follows:
(a) The Board shall conduct outreach
to all segments of the softwood lumber
industry. Softwood lumber domestic
manufacturers and importers may
submit nominations to the Board.
Nominees must domestically
manufacture and/or import 15 million
board feet or more of softwood lumber
per fiscal year;
(b) Domestic manufacturers and
importer nominees may provide the
Board a short background statement
outlining their qualifications to serve on
the Board;
(c) Nominees may seek nomination to
the Board for all open or vacant seats for
which the nominees are eligible;
(d) The Board will evaluate all eligible
nominees and submit the name of one
E:\FR\FM\25SER1.SGM
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50300
Federal Register / Vol. 84, No. 186 / Wednesday, September 25, 2019 / Rules and Regulations
nominee for each open seat and the
name of one additional nominee for
each open seat to the Secretary. Other
qualified persons interested in serving
in the open seats but not recommended
by the Board will be designated by the
Board as additional nominees for
consideration by the Secretary;
(e) The Board must submit
nominations to the Secretary at least six
months before the new Board term
begins. From the nominations submitted
by the Board, the Secretary shall select
the members of the Board;
(f) No two members shall be
employed by a single corporation,
company, partnership, or any other legal
entity. This includes subsidiaries and
affiliates thereof; and
(g) The Board may recommend to the
Secretary modifications to its
nomination procedures as it deems
appropriate. Any such modifications
shall be implemented through
rulemaking by the Secretary.
■ 4. Revise § 1217.44 to read as follows:
jbell on DSK3GLQ082PROD with RULES
§ 1217.44
Procedure.
(a) A majority of Board members
(exclusive of vacant seats) will
constitute a quorum so long as at least
two of the members present are importer
members and five of the members
present are domestic manufacturers. If
participation by telephone or other
means is permitted, members
participating by such means shall count
as present in determining quorum or
other voting requirements set forth in
this section.
(b) All votes at meetings of the Board,
executive committee, and other
committees will be cast in person or by
electronic voting or other means as the
Board and Secretary deem appropriate
to allow members participating by
telephone or other electronic means to
cast votes. Voting by proxy will not be
allowed.
(c) Each member of the Board will be
entitled to one vote on any matter put
to the Board and the motion will carry
if supported by a majority of Board
members (exclusive of vacant seats),
except for recommendations to change
the assessment rate or to adopt a budget,
both of which require affirmation by at
least a majority of Board members plus
two (exclusive of vacant seats).
(d) The Board must give members and
the Secretary timely notice of all Board,
executive committee, and other
committee meetings.
(e) In lieu of voting at a properly
convened meeting, and when, in the
opinion of the Board’s chairperson, such
action is considered necessary, the
Board may take action by mail,
telephone, electronic mail, facsimile, or
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15:54 Sep 24, 2019
Jkt 247001
any other means of communication.
Any action taken under this procedure
is valid only if:
(1) All members and the Secretary are
notified, and the members are provided
the opportunity to vote;
(2) A majority of Board members
(exclusive of vacant seats) vote in favor
of the action (unless a vote of a majority
of Board members plus two (exclusive
of vacant seats) is required under the
Order); and
(3) All votes are promptly confirmed
in writing and recorded in the Board
minutes.
■ 5. Revise § 1217.52(h) to read as
follows:
§ 1217.52
*
*
*
*
*
(h) The HTSUS categories and
assessment rates on imported softwood
lumber are listed in the following table.
A factor shall be used to determine the
equivalent volume of softwood lumber
in thousand board feet. The factor used
to convert one cubic meter to one
thousand board feet is 0.423776001.
Accordingly, the assessment rate per
cubic meter is as follows.
TABLE 1 TO PARAGRAPH (H)
4407.11.00
4407.12.00
4407.19.05
4407.19.06
4407.19.10
4409.10.05
4409.10.10
4409.10.20
4409.10.90
4418.99.10
Assessment
($/cubic meter)
............................
............................
............................
............................
............................
............................
............................
............................
............................
............................
0.1483
0.1483
0.1483
0.1483
0.1483
0.1483
0.1483
0.1483
0.1483
0.1483
*
*
*
*
*
6. In § 1217.81, revise paragraphs
(b)(1) and (2) to read as follows:
■
§ 1217.81
Referenda.
*
*
*
*
*
(b) * * *
(1) For the purpose of ascertaining
whether manufacturers for the U.S.
market favor the continuation,
suspension, or termination of the Order;
(2) No later than seven years after the
Order becomes effective and every
seven years thereafter, to determine
whether softwood lumber
manufacturers for the U.S. market favor
the continuation of the Order. The
Order shall continue if it is favored by
a majority of domestic manufacturers
and importers voting in the referendum
who also represent a majority of the
volume of softwood lumber represented
in the referendum who, during a
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Frm 00014
Fmt 4700
■
7. Revise § 1217.88 to read as follows:
§ 1217.88
OMB Control numbers.
The control numbers assigned to the
information collection requirements by
the Office of Management and Budget
pursuant to the Paperwork Reduction
Act of 1995, 44 U.S.C. Chapter 35, are
OMB control number 0505–0001 (Board
nominee background statement) and
OMB control number 0581–0093.
8. Revise § 1217.101(l) to read as
follows:
■
Assessments.
Softwood lumber
(by HTSUS No.)
representative period determined by the
Secretary, have been engaged in the
domestic manufacturing or importation
of softwood lumber;
*
*
*
*
*
Sfmt 4700
§ 1217.101
Definitions.
*
*
*
*
*
(l) Softwood lumber means and
includes softwood lumber and products
manufactured from softwood as
described in section 804(a) within Title
VIII (Softwood Lumber Act of 2008 or
SLA of 2008) of the Tariff Act of 1930
(19 U.S.C. 1202–1677g), as amended by
section 3301 of the Food, Conservation
and Energy Act of 2008 (Pub. L. 110–
246, enacted June 18, 2008) and
categorized in the following
Harmonized Tariff Schedule of the
United States (HTSUS) numbers—
4407.11.00, 4407.12.00, 4407.19.05,
4407.19.06, 4407.19.10, 4409.10.05,
4409.10.10, 4409.10.20, 4409.10.90, and
4418.99.10. Domestic product that
cannot be categorized in the referenced
HTSUS numbers if it were an import is
not covered under the Order. Further,
softwood lumber originating in the
United States that is exported to another
country and shipped back to the United
States is also covered under the Order,
provided it can be categorized in the
referenced HTSUS numbers.
Additionally, articles brought into the
United States temporarily and for which
an exemption is claimed under
subchapter XIII of chapter 98 of the
HTSUS are exempted from the SLA of
2008 and are not covered under the
Order.
*
*
*
*
*
9. Revise § 1217.108 to read as
follows:
■
§ 1217.108
OMB control number.
The control number assigned to the
information collection requirement in
this subpart by the Office of
Management and Budget pursuant to the
Paperwork Reduction Act of 1995, 4
U.S.C. is OMB control number 0581–
0093.
E:\FR\FM\25SER1.SGM
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Federal Register / Vol. 84, No. 186 / Wednesday, September 25, 2019 / Rules and Regulations
Dated: September 16, 2019.
Bruce Summers,
Administrator.
[FR Doc. 2019–20291 Filed 9–24–19; 8:45 am]
BILLING CODE 3410–02–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 39
[Docket No. FAA–2019–0402; Product
Identifier 2019–NM–008–AD; Amendment
39–19731; AD 2019–18–04]
RIN 2120–AA64
Airworthiness Directives; Airbus SAS
Airplanes
Federal Aviation
Administration (FAA), DOT.
ACTION: Final rule.
AGENCY:
The FAA is superseding
Airworthiness Directive (AD) 2005–17–
14, which applied to all Airbus SAS
Model A300 series airplanes; Model
A300 B4–600, B4–600R, and F4–600R
series airplanes, and Model A300 C4–
605R Variant F airplanes (collectively
called Model A300–600 series
airplanes); and Model A310 series
airplanes. AD 2005–17–14 required
repetitive tests to detect
desynchronization of the rudder servo
actuators, and adjustment or
replacement of the spring rods of the
rudder servo actuators, if necessary. AD
2005–17–14 also required repetitive
tests/inspections/analyses of the rudder
servo actuators, and related
investigative/corrective actions if
necessary. This AD retains some
requirements of AD 2005–17–14 and
revises the inspection procedures and
compliance times, as specified in a
European Aviation Safety Agency
(EASA) AD, which is incorporated by
reference. This AD was prompted by
reports of desynchronization of the
rudder servo actuators. The FAA is
issuing this AD to address the unsafe
condition on these products.
DATES: This AD is effective October 30,
2019.
The Director of the Federal Register
approved the incorporation by reference
of a certain publication listed in this AD
as of October 30, 2019.
ADDRESSES: For the material
incorporated by reference (IBR) in this
AD, contact the EASA, at KonradAdenauer-Ufer 3, 50668 Cologne,
jbell on DSK3GLQ082PROD with RULES
SUMMARY:
VerDate Sep<11>2014
15:54 Sep 24, 2019
Jkt 247001
Germany; telephone +49 221 89990
1000; email ADs@easa.europa.eu;
internet www.easa.europa.eu. You may
find this IBR material on the EASA
website at https://ad.easa.europa.eu.
You may view this IBR material at the
FAA, Transport Standards Branch, 2200
South 216th St., Des Moines, WA. For
information on the availability of this
material at the FAA, call 206–231–3195.
It is also available in the AD docket on
the internet at https://
www.regulations.gov by searching for
and locating Docket No. FAA–2019–
0402.
Examining the AD Docket
You may examine the AD docket on
the internet at https://
www.regulations.gov by searching for
and locating Docket No. FAA–2019–
0402; or in person at Docket Operations
between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
The address for Docket Operations is
U.S. Department of Transportation,
Docket Operations, M–30, West
Building Ground Floor, Room W12–140,
1200 New Jersey Avenue SE,
Washington, DC 20590.
FOR FURTHER INFORMATION CONTACT: Dan
Rodina, Aerospace Engineer,
International Section, Transport
Standards Branch, FAA, 2200 South
216th St., Des Moines, WA 98198;
telephone and fax 206–231–3225.
SUPPLEMENTARY INFORMATION:
Discussion
The EASA, which is the Technical
Agent for the Member States of the
European Union, has issued EASA AD
2019–0017, dated January 29, 2019
(‘‘EASA AD 2019–0017’’) (also referred
to as the Mandatory Continuing
Airworthiness Information, or ‘‘the
MCAI’’), to correct an unsafe condition
for all Airbus SAS Model A300 series
airplanes, Model A300–600 series
airplanes, and Model A310 series
airplanes.
The FAA issued a notice of proposed
rulemaking (NPRM) to amend 14 CFR
part 39 to supersede AD 2005–17–14,
Amendment 39–14235 (70 FR 50157,
August 26, 2005) (‘‘AD 2005–17–14’’).
AD 2005–17–14 applied to all Airbus
SAS Model A300 series airplanes,
Model A300–600 series airplanes, and
Model A310 series airplanes. The NPRM
published in the Federal Register on
June 10, 2019 (84 FR 26781). The NPRM
was prompted by reports of
desynchronization of the rudder servo
actuators. The NPRM proposed to
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Fmt 4700
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50301
require repetitive inspections of the
rudder servo actuators and related
investigative/corrective actions. The
FAA is issuing this AD to address
desynchronization of one of the three
rudder servo actuators, which, if
combined with an engine failure, could
result in the loss of the related hydraulic
system and could cause the loss of one
of the two synchronized actuators. This
condition could create additional
fatigue loading and possible cracking of
the attachment fittings and could result
in the inability of the remaining
synchronized actuator to maintain the
commanded rudder deflection, leading
to reduced controllability of the
airplane. See the MCAI for additional
background information.
Comments
The FAA gave the public the
opportunity to participate in developing
this final rule. The FAA has considered
the comments received. The Air Line
Pilots Association, International
(ALPA), and FedEx expressed support
for the NPRM.
Conclusion
The FAA reviewed the relevant data,
considered the comments received, and
determined that air safety and the
public interest require adopting this
final rule as proposed, except for minor
editorial changes. The FAA has
determined that these minor changes:
• Are consistent with the intent that
was proposed in the NPRM for
addressing the unsafe condition; and
• Do not add any additional burden
upon the public than was already
proposed in the NPRM.
Related IBR Material Under 1 CFR Part
51
EASA AD 2019–0017 describes
procedures for repetitive inspections of
the rudder servo actuators and related
investigative/corrective actions. Related
investigative actions include repetitive
inspections of fin box and rudder servo
controls. Corrective actions include
repair. This material is reasonably
available because the interested parties
have access to it through their normal
course of business or by the means
identified in the ADDRESSES section.
Costs of Compliance
The FAA estimates that this AD
affects 133 airplanes of U.S. registry.
The FAA estimates the following costs
to comply with this AD:
E:\FR\FM\25SER1.SGM
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]]>Agencies
[Federal Register Volume 84, Number 186 (Wednesday, September 25, 2019)]
[Rules and Regulations]
[Pages 50294-50301]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-20291]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1217
[Document Number AMS-SC-19-0015]
Softwood Lumber Research, Promotion, Consumer Education and
Industry Information Order; Change in Membership, Nominations,
Procedures, and Continuance Referenda Period
AGENCY: Agricultural Marketing Service.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This rule changes the membership, nominations, procedures, and
continuance referenda period for the Softwood Lumber Board (Board)
established under the Softwood Lumber Research, Promotion, Consumer
Education and Industry Information Order (Order). The Board administers
the Order with oversight by the U.S. Department of Agriculture (USDA).
This action will also make administrative changes to other provisions
of the Order.
DATES: Effective Date: October 25, 2019.
FOR FURTHER INFORMATION CONTACT: Andrea Ricci, Marketing Specialist,
Promotion and Economics Division, Specialty Crops Program, AMS, USDA,
1400 Independence Avenue SW, Room 1406-S, Washington, DC 20250;
telephone: (202) 572-1442; facsimile (202) 205-2800; or electronic
mail: [email protected].
SUPPLEMENTARY INFORMATION: This rule affecting 7 CFR part 1217 (the
Softwood Lumber Research, Promotion, Consumer Education and Industry
Information (Order)) is authorized under the Commodity Promotion,
Research, and Information Act of 1996 (1996 Act) (7 U.S.C. 7411-7425).
Executive Orders 12866, 13563, and 13771
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, reducing costs, harmonizing rules and promoting flexibility.
This action falls within a category of regulatory actions that the
Office of Management and Budget (OMB) exempted from Executive Order
12866 review. Additionally, because this rule does not meet the
definition of a significant regulatory action it does not trigger the
requirements contained in Executive Order 13771. See OMB's Memorandum
titled ``Interim Guidance Implementing Section 2 of the Executive Order
of January 30, 2017, titled `Reducing Regulation and Controlling
Regulatory Costs''' (February 2, 2017).
Executive Order 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 rule has been reviewed under Executive Order 12988, Civil
Justice Reform. It is not intended to have retroactive effect. Section
524 of the 1996 Act (7 U.S.C. 7423) provides that it shall not affect
or preempt any other Federal or State law authorizing promotion or
research relating to an agricultural commodity.
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Office of Information and Regulatory Affairs designated this rule
as not a major rule, as defined by 5 U.S.C. 804(2).
Under section 519 of the 1996 Act (7 U.S.C. 7418), a person subject
to an order may file a written petition with USDA stating that an
order, any provision of an order, or any obligation imposed in
connection with an order, is not established in accordance with the
law, and request a modification of an order or an exemption from an
order. Any petition filed challenging an order, any provision of an
order, or any obligation imposed in connection with an order, shall be
filed within two years after the effective date of an order, provision,
or obligation subject to challenge in the petition. The petitioner will
have the opportunity for a hearing on the petition. Thereafter, USDA
will issue a ruling on the petition. The 1996 Act provides that the
district court of the United States for any district in which the
petitioner resides or conducts business shall have the jurisdiction to
review a final ruling on the petition, if the petitioner files a
complaint for that purpose not later than 20 days after the date of the
entry of USDA's final ruling.
Background
This rule changes the Board's membership, nominations, procedures,
and continuance referenda period under the Order. The Board administers
the Order with oversight by USDA. Under the Order, assessments are
collected from manufacturers and importers and used for projects to
promote softwood lumber within the United States. This rule reduces the
number of Board members from 19 to 14, revises the nomination
procedures, and revises the quorum and voting procedures. This rule
also revises the time frame for periodic continuance referenda from
five to seven years. Finally, this rule makes clarifying and conforming
changes to other provisions of the Order. All of these changes will
help facilitate program operations and were recommended to the
Secretary by the Board at its November 28, 2018 meeting.
Board Membership and Geographical Distribution
Pursuant to Sec. 1217.40(b), the Board is composed of 18 or 19
members, depending upon whether an additional importer member is
appointed to the Board. Seats on the Board are apportioned based on the
volume of softwood lumber manufactured and shipped within the United
States by
[[Page 50295]]
domestic manufacturers and the volume of softwood lumber imported into
the United States. Seats are also apportioned based on size of
operation within each geographic region as specified herein. Large
manufacturers are those who account for the top two-thirds of the total
annual volume of assessable softwood lumber and small manufacturers are
those who account for the remaining one-third of the total annual
volume of assessable softwood lumber, based on a three-year average.
Table 1 shows the current structure of the Board. Of the 19 total
Board seats, 12 are held by domestic manufacturers and seven are held
by importers, six of whom are Canadian. Of the 12 domestic
manufacturers, six represent the U.S. South (two large and four small),
five represent the U.S. West (four large and one small), and one
represents the Northeast and Lake States. Of the six Canadian
importers, four represent Canada West (three large and one small) and
two represent Canada East (one large and one small). An additional
importer member may be appointed to represent all other importing
countries other than Canada.
[GRAPHIC] [TIFF OMITTED] TR25SE19.000
Section 1217.40(c)(1) requires that, in each five-year period, the
Board review, based on a three-year average, the geographical
distribution of the volume of softwood lumber manufactured and shipped
within the United States by domestic manufacturers and the volume of
softwood lumber imported into the United States. Section 1217.40(c)(2)
requires that the Board also review, based on a three-year average, the
distribution of the size of operations within each region. Section
1217.40(c)(3) specifies that, if warranted, the Board may recommend to
the Secretary the reapportionment of its membership to reflect changes
in the geographical distribution of the volume of softwood lumber
manufactured and shipped within the United States by domestic
manufacturers and the volume of softwood lumber imported into the
United States. The number of Board members may also be changed. Any
changes in Board composition shall be implemented by the Secretary
through rulemaking.
Pursuant to Sec. 1217.40, the Board evaluated the geographic
distribution of softwood lumber by region, based on a three-year
average (2015-2017). The Board utilized data from Forest Economic
Advisors \1\ to evaluate the regional distribution of assessable
softwood lumber. The results of this evaluation are shown in Table 2.
Based on a three-year average (2015-2017), the volume of assessed
softwood lumber was largest in the U.S. South and U.S. West regions, at
36 percent and 30 percent, respectively, of the total assessed volume
over all regions. Canada West followed with 20 percent of the total
assessed volume. In these three regions, assessed volume by large
entities made up the majority of assessed regional volume. In all other
regions, assessed volume by small entities was either equal to or
greater than the assessed volume by large entities.
---------------------------------------------------------------------------
\1\ Forest Economic Advisors, LLC. FEA is an owner-operated
company comprised of experienced and informed analysts covering the
forest products industry. FEA applies rigorous economic analysis and
delivers actionable information though their third-party forecasts
and monthly advisors.
---------------------------------------------------------------------------
[[Page 50296]]
[GRAPHIC] [TIFF OMITTED] TR25SE19.001
From this evaluation, the Board recommended revising the Board
membership from 19 current seats to 14 seats for the 2021 term of
office, of which six members must represent large manufacturers or
importers, four must represent small manufacturers or importers, and
four may represent any size manufacturers or importers. Of the four
representing any size manufacturer or importer, at least two of these
members must represent small manufacturers or importers. The Board
recommended adding more flexibility to the Order in terms of certain
seats being open to representatives of any size manufacturer or
importer. This will allow the Board to better adjust in the future to
shifts in the size of operations within a region.
The Board also took into consideration the consolidation in the
softwood lumber industry since the inception of the Order. The Board
has indicated that the number of companies eligible to be represented
on the Board has declined. According to the Board, there were about 290
entities eligible to be represented on the Board in 2013, and about 210
entities in 2018. The Board has faced challenges securing enough
nominees for membership on the Board. This compelled the Board to
consider a reduction in Board membership.
The Board seats are revised as follows: Ten domestic manufacturers
seats, of which five members must be from the U.S. South Region (two
large, two small, and one manufacturer of any size), four members must
be from the U.S. West Region (two large, one small, and one
manufacturer of any size), and one member from the Northeast and Lake
States Region. Importers will have four seats on the Board (two large,
one small, and one importer of any size) with a minimum of two from
Canada West Region, a minimum of one from Canada East Region and the
remaining member may be from Canada West, Canada East or offshore
Regions. Table 3 illustrates this categorization of seats in the
revised Board structure.
[GRAPHIC] [TIFF OMITTED] TR25SE19.002
As the Board conducted the evaluation pursuant to Sec. 1217.40, it
also made a recommendation to align Sec. 1217.40(a) and (c)(1) and (3)
with section 515(b)(3) of the 1996 Act. (7 U.S.C. 7414(b)(3)). Section
1217.40(a) clarifies that the Board shall be apportioned based on the
volume of softwood lumber production that is manufactured and shipped
within the United States by domestic manufacturers. Section
1217.40(c)(1) and (3), respectively, specify that the Board shall
review, based on a three-year average, the geographical distribution of
the volume of softwood lumber produced and shipped within the United
States by domestic manufacturers, and that the Board shall make
recommendations to revise its structure based on this review.
Additionally, the Board recommended that U.S. Board members reside
in the region they represent. This will ensure that entities from
outside the U.S. that own softwood lumber entities within the U.S.
could represent a U.S. region on the Board only if the individual
seeking nomination resides in the respective region. The Board will
review the USDA Advisory Committee on Research and Promotion Background
Information Form AD-755 to determine in which Region each nominee
resides.
According to the Board, this action should make the reduced number
of seats easier to fill and reflect the current distribution of the
industry.
The Board recommended a transitional approach to reduce the Board
from 19 members to 14 members over a three-year period. The 2019
[[Page 50297]]
Board currently has 19 members. The 2020 Board will have 16 members
consisting of five domestic manufacturer members representing the U.S.
South Region (two large and three small), five representing the U.S.
West Region (four large and one small) and one representing the
Northeast and Lake States. Of the five Canadian importers (three large
and two small), there will be three from the Canada West Region and two
from the Canada East Region. The non-Canadian importer seat will not be
filled in 2020 (when the current member reaches tenure).
The 2021 Board will have 14 members consisting of five domestic
manufacturer members representing the U.S. South Region (two large, two
small and one manufacturer of any size), four members representing the
U.S. West Region (two large, one small and one manufacturer of any
size) and one representing the Northeast and Lake States. Of the four
Canadian importers (two large, one small and one importer of any size),
there will be two from the Canada West Region and one from the Canada
East Region. The remaining member may be from Canada West, Canada East
or offshore Regions.
Nomination Procedures
Section 1217.41 establishes the procedures for the conduct of
nominations to obtain Board nominees for appointment by the Secretary.
The Board recommended to remove the procedures in Sec. 1217.41(a)
regarding the initial nominations to select the nominees for the
initial Board in 2011. Section 1217.41(b) establishes an election
process for nominations. In order to secure more nominees for Board
seats, the Board recommended removing the election process from its
nomination procedures.
The nomination procedure provides that the Board conduct outreach
and solicit nominees who are interested in serving on the Board. A
nominee could seek nomination to the Board for all seats for which he
or she is qualified. The Board will evaluate all nominees and submit
one recommended candidate for each open seat and one additional nominee
for each open seat to the Secretary for consideration. Other qualified
persons interested in serving in the open seats but not recommended by
the Board will be designated as other nominees for consideration by the
Secretary. From the nominations made, the Secretary would appoint
members of the Board.
Finally, the Board recommended a clarification to Sec.
1217.41(b)(7) that specifies no two members shall be employed by a
single corporation, company, partnership, or any other legal entity,
includes subsidiaries and affiliates thereof. Section 1217.41 will be
revised accordingly.
Quorum and Voting Procedures
Section 1217.44 specifies the quorum and voting procedures for the
Board based on the current 19 Board members. The Board's recommendation
is to revise these provisions from specific number requirements needed
for a quorum and for votes to a general term ``majority'' that could
apply to any size Board. Thus, the Board recommended these conforming
changes to complement the reduction in Board membership. Section
1217.44 will be revised accordingly.
Continuance Referenda Period
Section 1217.81(b) specifies that the Secretary conduct a
referendum of the industry for the purpose of ascertaining whether
manufacturers for the U.S. market favor the continuation of the Order.
The first continuance referendum was held in 2018, and 78 percent of
the voters representing 94 percent of the volume voted supported
continuance of the Order. The Board recommended that the period between
referenda be extended from five to seven years for the purpose of
efficiency. The Board would incur costs associated with referenda once
every seven years rather than every five years. The Order would still
permit referenda to be held at the request of the Board; at the request
of 10 percent or more of the number of persons eligible to vote in a
referendum; and at any time as determined by the Secretary, pursuant to
Sec. 1217.81(b)(3), (4) and (5), respectively. Section 1217.81(b) will
be revised accordingly.
This rule also makes minor changes to Sec. Sec. 1217.52(h) and
1217.101(l), by updating the Harmonized Tariff Schedule (HTS) number
codes. The HTS number codes are periodically updated by the United
States Internal Trade Commission. Finally, this rule changes the OMB
control number assigned to the previously approved information
collection referenced in Sec. Sec. 1217.88 and 1217.108 from 0581-0264
to 0581-0093, the correct control number assigned by OMB.
Final Regulatory Flexibility Act Analysis
In accordance with the Regulatory Flexibility Act (RFA) (5 U.S.C.
601-612), AMS is required to examine the impact of the rule on small
entities. Accordingly, AMS has considered the economic impact of this
action on such entities.
The purpose of the RFA is to fit regulatory actions to the scale of
businesses subject to such actions so that small businesses will not be
disproportionately burdened. The Small Business Administration (SBA)
defines, in 13 CFR part 121, small agricultural service firms (domestic
manufacturers and importers) as those having annual receipts of no more
than $7.5 million.\2\ The Random Lengths yearly average framing lumber
composite price was $460 per thousand board feet in 2018.\3\ Dividing
the $7.5 million threshold that defines an agricultural service firm as
small by this price results in a maximum threshold of 16.3 million
board feet (mmbf) of softwood lumber per year that a domestic
manufacturer or importer may ship to be considered a small entity for
purposes of the RFA. Table 4 shows the number of entities and the
amount of volume they represent that may be categorized as small or
large based on the SBA definition.
---------------------------------------------------------------------------
\2\ SBA does have a small business size standard for
``Sawmills'' of 500 employees (see https://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf). Based on USDA's
understanding of the lumber industry, using this criterion would be
impractical as sawmills often use contractors rather than employees
to operate and, therefore, many mills would fall under this
criterion while being, in reality, a large business. Therefore, USDA
used agricultural service firm as a more appropriate criterion for
this analysis.
\3\ Random Lengths Publications, Inc.; www.randomlengths.com.
---------------------------------------------------------------------------
[[Page 50298]]
[GRAPHIC] [TIFF OMITTED] TR25SE19.003
As shown in Table 4, there were a total of 1,383 domestic
manufacturers and importers of softwood lumber based on 2018 data. Of
these, 931 entities, or 67 percent, shipped or imported less than 16.3
mmbf and would be small entities under the SBA definition. These 931
entities domestically manufactured or imported 2.07 billion board feet
(bbf) in 2018, less than 3 percent of total volume. The reduction in
Board seats and other administrative changes will not
disproportionately burden small domestic manufacturers and importers of
softwood lumber.
This rule revises the Board's membership, nominations, procedure,
and continuance referenda period provisions under the Order. Section
1217.40 is revised to reduce the number of Board members from 19 to 14
and reflects the diversity of the industry in terms of geographical
distribution and size of operation. An additional change to this
section requires that U.S. Board members reside in the region they
represent. Section 1217.41 is revised by eliminating the election
process in the nomination procedures. In Sec. 1217.44 the quorum and
voting procedures for the Board are revised to complement the reduction
in Board membership. Section 1217.81 is revised to instruct that
subsequent continuance referenda to be conducted every seven years
rather than five. These changes were recommended by the Board and are
authorized under Sec. Sec. 1217.40(c)(3), 1217.41(b)(8), 1217.46(b),
and 1217.87 of the Order and section 515(b)(3) of the 1996 Act.
Regarding the economic impact of this rule on affected entities,
these changes are administrative in nature and would have no economic
impact on entities covered under the program. These changes will help
in securing nominees to fill seats on the Board, address the concerns
of the softwood lumber industry not securing enough nominees to be
submitted to the Secretary for selection, make conforming changes
necessary to complement the reduction in Board membership, and improve
efficiency regarding continuance referenda.
The Board's Industry Relations and Governance Committee (Committee)
reviewed various alternatives to the Board's current 19-member make-up.
The Committee considered a 12 and 13-member Board. The committee also
considered maintaining the status quo at 19 members. Regarding the
referenda period, one option the Board considered was to maintain the
status quo. However, the Board recommended changing the period from
five to seven years to improve the operating efficiency of the Board.
Reporting and Recordkeeping Requirements
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the Order's information collection and recordkeeping
requirements have been approved previously under OMB control number
0581-0093. This rule does not result in a change to the information
collection and recordkeeping requirements previously approved and does
not impose additional reporting requirements or recordkeeping burden on
domestic manufacturers and importers of softwood lumber.
As with all Federal promotion programs, reports and forms are
periodically reviewed to reduce information requirements and
duplication by industry and public-sector agencies. USDA has not
identified any relevant Federal rules that duplicate, overlap, or
conflict with this rule.
Regarding outreach efforts, the actions were discussed by the
Board's Industry Relations and Governance Committee at meetings on May
30, 2018, August 15, 2018, and October 26, 2018. The full Board
discussed outreach efforts at meetings on May 31, 2018, August 15,
2018. The Board then made its recommendation to the Secretary on
November 28, 2018. All of the Board's meetings, including meetings held
via teleconference, are open to the public and interested persons are
invited to participate and express their views.
A proposed rule concerning this action was published in the Federal
Register on June 26, 2019 (84 FR 30040). A 30-day comment period ending
July 26, 2019, was provided to allow interested persons to submit
comments.
Analysis of Comments
Fifteen comments were received in response to the proposed rule.
Thirteen comments supported all the Board recommended changes. Two
comments were considered outside the scope of this action. In summary,
most commenters agreed that reducing the size of the Board is
appropriate due to industry consolidation, resulting in fewer
individuals eligible to serve. One commenter noted that the reduced
size would allow the Board to administer the program more efficiently
and would help streamline business operations. In addition, one
commenter supported the proposed approach to the geographic
distribution, stating that it allows for fair and appropriate
representation of all segments of the industry. Thirteen commenters
supported the proposed change to the nomination procedures noting that
allowing the Board to conduct outreach and recommend nominees to the
Secretary is a more acceptable process for the industry. Lastly, the
commenters agreed that extending the period between conducting
continuance referenda from five to seven years was in the best interest
of the program. It not only reduces the cost to the industry and
provides a more efficient process, but it allows the Board to focus on
its program areas of research and promotion of softwood lumber.
After consideration of all relevant material presented, including
the information and recommendations submitted by the Board, the
comments received, and other available information, it is hereby found
that this rule, as hereinafter set forth, is consistent with and will
effectuate the purposes of the 1996 Act.
List of Subjects in 7 CFR Part 1217
Administrative practice and procedure, Advertising, Consumer
information, Marketing agreements, Reporting and recordkeeping
requirements, Softwood Lumber promotion.
For the reasons set forth in the preamble, 7 CFR part 1217 is
amended as follows:
[[Page 50299]]
PART 1217--SOFTWOOD LUMBER RESEARCH, PROMOTION, CONSUMER EDUCATION
AND INDUSTRY INFORMATION ORDER
0
1. The authority citation for 7 CFR part 1217 continues to read as
follows:
Authority: 7 U.S.C. 7411-7425; 7 U.S.C. 7401.
0
2. Revise Sec. 1217.40 to read as follows:
Sec. 1217.40 Establishment and membership.
(a) Establishment of the Board. There is hereby established a
Softwood Lumber Board to administer the terms and provisions of the
Order and promote the use of softwood lumber. The Board shall be
composed of manufacturers for the U.S. market who manufacture and
domestically ship or import 15 million board feet or more of softwood
lumber in the United States during a fiscal period. Seats on the Board
shall be apportioned based on the volume of softwood lumber production
that is manufactured and shipped within the United States by domestic
manufacturers and the volume of softwood lumber imported into the
United States. Seats on the Board shall also be apportioned based on
size of operation within each geographic region, as specified in
paragraphs (b)(1)(i) and (ii) and (b)(2) and (3) of this section. For
purposes of this section, ``large'' means manufacturers for the U.S.
market who account for the top two-thirds of the total annual volume of
assessable softwood lumber and ``small'' means those who account for
the remaining one-third of the total annual volume of assessable
softwood lumber. If there are no eligible nominees for a large or small
seat within a region, that seat may be filled by a nominee representing
an eligible manufacturer for the U.S. market of any size. Should the
size of a manufacturer for the U.S. market change during a member's
term of office, that member may serve for the remainder of the term.
(b) Composition of the Board. The 2020 Board shall be composed of
16 members. The 2021 Board and each subsequent Board shall be composed
of 14 members. The Board shall be established as follows:
(1) Domestic manufacturers. For the 2020 Board, 11 members shall
represent domestic manufacturers and for the 2021 Board and each
subsequent Board, ten members shall represent domestic manufacturers
who reside in the following three regions:
(i) Five members shall reside in the U.S. South Region, which
consists of the states of Alabama, Arkansas, Florida, Georgia,
Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina,
Tennessee, Texas, Virginia, and West Virginia. For the 2020 Board, of
these five members, two must represent large and three must represent
small domestic manufacturers. For the 2021 Board and each subsequent
Board of these five members, two must represent large, two must
represent small, and one may represent domestic manufacturers of any
size;
(ii) Five members shall reside in the U.S. West Region for the 2020
Board, and for the 2021 Board and each subsequent Board, four members
shall reside in the U.S. West Region, which consists of the states of
Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada,
New Mexico, North Dakota, Oregon, South Dakota, Utah, Washington, and
Wyoming. For the 2020 Board, of these five members, four must represent
large and one must represent small domestic manufacturers. For the 2021
Board and each subsequent Board, of the four members, two must
represent large, one must represent small, and one may represent
domestic manufacturers of any size; and
(iii) One member shall reside in the Northeast and Lake States
Region, which consists of the states of Connecticut, Delaware,
Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland,
Massachusetts, Michigan, Minnesota, Missouri, Nebraska, New Hampshire,
New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Vermont,
Wisconsin and all other parts of the United States not listed in
paragraph (b)(1)(i), (ii), or (iii) of this section. This member may
represent domestic manufacturers of any size.
(iv) For the 2021 Board, four members may represent a manufacturer
for the U.S. market of any size.
(2) Importers for the 2020 Board. Five members shall be importers
from the following two regions:
(i) Three members must import softwood lumber from the Canadian
West Region, which consists of the provinces of British Columbia and
Alberta. Of these three members, two must represent large and one must
represent small importers; and
(ii) Two members must import softwood lumber from the Canadian East
Region, which consists of the Canadian territories and all other
Canadian provinces not listed in paragraph (b)(2)(i) of this section
that import softwood lumber into the United States. Of these two
members, one must represent large and one must represent small
importers.
(3) Importers for the 2021 Board and each subsequent Board. Four
members shall represent importers. Of these four members, two must
represent large, one must represent small, and one may represent
importers of any size. At least three of these members must import
softwood lumber from the following regions:
(i) Two members must import softwood lumber from the Canadian West
Region, as defined in paragraph (b)(2)(i) of this section; and
(ii) One member must import softwood lumber from the Canadian East
Region, as defined in paragraph (b)(2)(ii) of this section.
(c) Periodic review. In each five-year period, but not more
frequently than once in each three-year period, the Board shall:
(1) Review, based on a three-year average, the geographical
distribution of the volume of softwood lumber production that is
manufactured and shipped within the United States by domestic
manufacturers and the volume of softwood lumber imported into the
United States; and
(2) Review, based on a three-year average, the distribution of the
size of operations within each region; and
(3) If warranted, recommend to the Secretary the reapportionment of
the Board membership to reflect changes in the geographical
distribution of the volume of softwood lumber production that is
manufactured and shipped within the United States by domestic
manufacturers and the volume of softwood lumber imported into the
United States. The distribution of volumes between regions and the
distribution of the size of operations within regions shall also be
considered. The number of Board members may also be changed. Any
changes in Board composition shall be implemented by the Secretary
through rulemaking.
0
3. Revise Sec. 1217.41 to read as follows:
Sec. 1217.41 Nominations and appointments.
Nominations shall be conducted as follows:
(a) The Board shall conduct outreach to all segments of the
softwood lumber industry. Softwood lumber domestic manufacturers and
importers may submit nominations to the Board. Nominees must
domestically manufacture and/or import 15 million board feet or more of
softwood lumber per fiscal year;
(b) Domestic manufacturers and importer nominees may provide the
Board a short background statement outlining their qualifications to
serve on the Board;
(c) Nominees may seek nomination to the Board for all open or
vacant seats for which the nominees are eligible;
(d) The Board will evaluate all eligible nominees and submit the
name of one
[[Page 50300]]
nominee for each open seat and the name of one additional nominee for
each open seat to the Secretary. Other qualified persons interested in
serving in the open seats but not recommended by the Board will be
designated by the Board as additional nominees for consideration by the
Secretary;
(e) The Board must submit nominations to the Secretary at least six
months before the new Board term begins. From the nominations submitted
by the Board, the Secretary shall select the members of the Board;
(f) No two members shall be employed by a single corporation,
company, partnership, or any other legal entity. This includes
subsidiaries and affiliates thereof; and
(g) The Board may recommend to the Secretary modifications to its
nomination procedures as it deems appropriate. Any such modifications
shall be implemented through rulemaking by the Secretary.
0
4. Revise Sec. 1217.44 to read as follows:
Sec. 1217.44 Procedure.
(a) A majority of Board members (exclusive of vacant seats) will
constitute a quorum so long as at least two of the members present are
importer members and five of the members present are domestic
manufacturers. If participation by telephone or other means is
permitted, members participating by such means shall count as present
in determining quorum or other voting requirements set forth in this
section.
(b) All votes at meetings of the Board, executive committee, and
other committees will be cast in person or by electronic voting or
other means as the Board and Secretary deem appropriate to allow
members participating by telephone or other electronic means to cast
votes. Voting by proxy will not be allowed.
(c) Each member of the Board will be entitled to one vote on any
matter put to the Board and the motion will carry if supported by a
majority of Board members (exclusive of vacant seats), except for
recommendations to change the assessment rate or to adopt a budget,
both of which require affirmation by at least a majority of Board
members plus two (exclusive of vacant seats).
(d) The Board must give members and the Secretary timely notice of
all Board, executive committee, and other committee meetings.
(e) In lieu of voting at a properly convened meeting, and when, in
the opinion of the Board's chairperson, such action is considered
necessary, the Board may take action by mail, telephone, electronic
mail, facsimile, or any other means of communication. Any action taken
under this procedure is valid only if:
(1) All members and the Secretary are notified, and the members are
provided the opportunity to vote;
(2) A majority of Board members (exclusive of vacant seats) vote in
favor of the action (unless a vote of a majority of Board members plus
two (exclusive of vacant seats) is required under the Order); and
(3) All votes are promptly confirmed in writing and recorded in the
Board minutes.
0
5. Revise Sec. 1217.52(h) to read as follows:
Sec. 1217.52 Assessments.
* * * * *
(h) The HTSUS categories and assessment rates on imported softwood
lumber are listed in the following table. A factor shall be used to
determine the equivalent volume of softwood lumber in thousand board
feet. The factor used to convert one cubic meter to one thousand board
feet is 0.423776001. Accordingly, the assessment rate per cubic meter
is as follows.
Table 1 to Paragraph (h)
------------------------------------------------------------------------
Assessment ($/
Softwood lumber (by HTSUS No.) cubic meter)
------------------------------------------------------------------------
4407.11.00.............................................. 0.1483
4407.12.00.............................................. 0.1483
4407.19.05.............................................. 0.1483
4407.19.06.............................................. 0.1483
4407.19.10.............................................. 0.1483
4409.10.05.............................................. 0.1483
4409.10.10.............................................. 0.1483
4409.10.20.............................................. 0.1483
4409.10.90.............................................. 0.1483
4418.99.10.............................................. 0.1483
------------------------------------------------------------------------
* * * * *
0
6. In Sec. 1217.81, revise paragraphs (b)(1) and (2) to read as
follows:
Sec. 1217.81 Referenda.
* * * * *
(b) * * *
(1) For the purpose of ascertaining whether manufacturers for the
U.S. market favor the continuation, suspension, or termination of the
Order;
(2) No later than seven years after the Order becomes effective and
every seven years thereafter, to determine whether softwood lumber
manufacturers for the U.S. market favor the continuation of the Order.
The Order shall continue if it is favored by a majority of domestic
manufacturers and importers voting in the referendum who also represent
a majority of the volume of softwood lumber represented in the
referendum who, during a representative period determined by the
Secretary, have been engaged in the domestic manufacturing or
importation of softwood lumber;
* * * * *
0
7. Revise Sec. 1217.88 to read as follows:
Sec. 1217.88 OMB Control numbers.
The control numbers assigned to the information collection
requirements by the Office of Management and Budget pursuant to the
Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35, are OMB control
number 0505-0001 (Board nominee background statement) and OMB control
number 0581-0093.
0
8. Revise Sec. 1217.101(l) to read as follows:
Sec. 1217.101 Definitions.
* * * * *
(l) Softwood lumber means and includes softwood lumber and products
manufactured from softwood as described in section 804(a) within Title
VIII (Softwood Lumber Act of 2008 or SLA of 2008) of the Tariff Act of
1930 (19 U.S.C. 1202-1677g), as amended by section 3301 of the Food,
Conservation and Energy Act of 2008 (Pub. L. 110-246, enacted June 18,
2008) and categorized in the following Harmonized Tariff Schedule of
the United States (HTSUS) numbers--4407.11.00, 4407.12.00, 4407.19.05,
4407.19.06, 4407.19.10, 4409.10.05, 4409.10.10, 4409.10.20, 4409.10.90,
and 4418.99.10. Domestic product that cannot be categorized in the
referenced HTSUS numbers if it were an import is not covered under the
Order. Further, softwood lumber originating in the United States that
is exported to another country and shipped back to the United States is
also covered under the Order, provided it can be categorized in the
referenced HTSUS numbers. Additionally, articles brought into the
United States temporarily and for which an exemption is claimed under
subchapter XIII of chapter 98 of the HTSUS are exempted from the SLA of
2008 and are not covered under the Order.
* * * * *
0
9. Revise Sec. 1217.108 to read as follows:
Sec. 1217.108 OMB control number.
The control number assigned to the information collection
requirement in this subpart by the Office of Management and Budget
pursuant to the Paperwork Reduction Act of 1995, 4 U.S.C. is OMB
control number 0581-0093.
[[Page 50301]]
Dated: September 16, 2019.
Bruce Summers,
Administrator.
[FR Doc. 2019-20291 Filed 9-24-19; 8:45 am]
BILLING CODE 3410-02-P
