Amendments to the United States Potato Board Membership and Assessment Methods, 51626-51629 [2021-19676]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 86, Number 177 (Thursday, September 16, 2021)]
[Proposed Rules]
[Pages 51626-51629]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-19676]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1207

[Document Number AMS-SC-21-0032]


Amendments to the United States Potato Board Membership and 
Assessment Methods

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposal invites comments on amendments to the Potato 
Research and Promotion Plan (Plan) as recommended by the National 
Potato Promotion Board (Board) and the Secretary of the U.S. Department 
of Agriculture (USDA). The Board administers the Plan with oversight 
provided by USDA's Agricultural Marketing Service (AMS). The Board 
recommends changing approved sources of potato production data used to 
determine the number of Board seats, expanding payment methods used to 
remit assessments to include electronic submission, and updating the 
table of Harmonized Tariff Schedule of the United States (HTS) codes 
and assessment rates for imported potatoes and potato products. 
Finally, proposed amendments would insert new language eliminating the 
need to amend the Plan just to update the list of relevant HTS codes.

DATES: Comments must be received by October 18, 2021.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule. All comments must be submitted through 
the Federal e-rulemaking portal at: https://www.regulations.gov and 
should reference the document number, date, and page number of this 
issue of the Federal Register. Comments submitted in response to this 
proposed rule will be included in the rulemaking record and will be 
made available to the public. Please be advised that the identity of 
individuals or entities submitting comments will be made public on the 
internet at: https://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Stacy Jones King, Marketing 
Specialist, Promotion and Economics Division, Specialty Crop Program, 
AMS, USDA, Stop 0244, 1400 Independence Avenue SW, Room 1406-S, 
Washington, DC 20250-0244; telephone: (202) 720-4140; or electronic 
mail: [email protected].

SUPPLEMENTARY INFORMATION: This proposal affecting the Plan (7 CFR part 
1207) is authorized under the Potato Research and Promotion Act (Act) 
(7 U.S.C. 2611-2627).

Executive Orders 12866 and 13563

    USDA is issuing this proposed rule in conformance with Executive 
Orders 12866 and 13563. 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

[[Page 51627]]

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.

Executive Order 13175

    This action has been reviewed in accordance with requirements of 
Executive Order 13175, Consultation and Coordination with Indian Tribal 
Governments. AMS has assessed the impact of this proposed rule on 
Indian tribes and determined that this rule would not have tribal 
implications that require consultation under Executive Order 13175. AMS 
hosts a quarterly teleconference with tribal leaders where matters of 
mutual interest regarding the marketing of agricultural products are 
discussed. Information about proposed changes to regulations will be 
shared during an upcoming quarterly call, and tribal leaders will be 
informed about proposed revisions to the regulation and the opportunity 
to submit comments. AMS will work with the USDA Office of Tribal 
Relations to ensure meaningful consultation is provided as needed with 
regards to this proposed change to the Plan.

Executive Order 12988

    This proposal has been reviewed under Executive Order 12988, Civil 
Justice Reform. It is not intended to have retroactive effect.
    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).
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 311 of the Act (7 
U.S.C. 2620), a person subject to a plan may file a petition with USDA 
stating that such plan, any provision of such plan, or any obligation 
imposed in connection with such plan, is not in accordance with law and 
request a modification of such plan or to be exempted therefrom. Such 
person is afforded the opportunity for a hearing on the petition. 
Thereafter, USDA will issue a ruling on the petition. The 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 date of the 
entry of USDA's final ruling.

Background

    This proposed rule invites comments on proposed amendments to 
approved sources of potato production data used to determine the number 
of Board seats, to which each State is entitled. Additionally, 
amendments would expand payment methods used to remit assessments to 
include electronic submission and update the table of HTS codes and 
assessment rates for imported potatoes and potato products. Finally, 
proposed amendments would insert new language to avoid future 
amendments to the Plan in the event that HTS numbers subject to 
assessment reflected in the table are changed and such changes are 
merely replacements of previous numbers.

Data Sources for Board Membership Recommendation

    The Plan became effective on March 9, 1972. Section 1207.320(b) of 
the Plan provides the formula used to determine how many Board member 
seats each State is entitled. Under the Plan, every State is eligible 
to have a Board representative and additional members based on potato 
production in that State. For each five million hundredweight of such 
production, or major fraction thereof, produced within each State, such 
State shall be entitled to one additional member.
    The Plan states that total annual potato production must come from 
the ``latest Crop Production Annual Summary Report issued by the Crop 
Reporting Board, U.S. Department of Agriculture.'' See Sec.  
1207.320(b). The Crop Production Annual Summary Report is currently 
issued by NASS.
    In March 2020, USDA's NASS and AMS communicated to the Board that 
NASS would no longer collect potato production data for the following 
ten states: Alaska, Illinois, Kansas, Maryland, Missouri, Montana, New 
Jersey, New York, North Carolina, and Virginia. In June 2020, NASS 
estimated the cost of collecting data at $80,000 per year. The Board 
considered this estimate and concluded that the cost to collect this 
information would exceed the value of assessments collected from the 
aforementioned ten States. Subsequently, the Board decided to 
temporarily freeze the number of seats for those ten States at their 
2019 quantities so that the Board could move forward with assigning 
Board member seats for 2020 nominations.
    At a July Board 2020 meeting, Board staff presented to the Board's 
Administrative Committee a summary of constraints related to the 
collection of production data. During a January 2021 meeting, Board 
staff further discussed the need to update the Plan with the 
Administrative Committee and made the recommendation to amend the Plan 
during a subsequent meeting on March 9, 2021.
    The Board recommended to use production data from audited 
assessment reports in place of NASS data for states not included in 
NASS reports.
    As indicated in Table 1, this amendment would allow the Board to 
use audited assessment data in instances where NASS data is 
unavailable.

                              Table 1--NASS Production and Board Production (Board) and Number of Producer Members by State
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                                                                                                                                             2020 NASS &
                                                                                                       2016-2018    2016-2018    2020 NASS      Board
                      State                        NASS 2016    NASS 2017    NASS 2018    Board 2018   NASS avg.      NASS &     number of    number of
                                                     (cwt)        (cwt)        (cwt)        (cwt)     (1,000 cwt)   Board Avg.    members      members
                                                                                                                   (1,000 cwt)  (cwt/5,000)  (cwt/5,000)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Alabama (AL)....................................  ...........  ...........  ...........           70  ...........  ...........            1            1
Illinois (IL)...................................        2,812        3,321        2,850          394        2,994        2,176            1            1
Kansas (KS).....................................        1,260        1,558        1,419          483        1,412        1,100            1            1
Maryland (MD)...................................  ...........          913          510          389          474          651            1            1
Missouri (MO)...................................        2,410        2,423        1,665        1,012        2,166        1,948            1            1
Montana (MT)....................................        3,685        3,774        3,830          149        3,763        2,536            1            1
New Jersey (NJ).................................  ...........          600          530          125          377          363            1            1
New York (NY)...................................        3,552        4,032        4,118          899        3,901        2,828            1            1
North Carolina (NC).............................        2,992        3,473        2,318        1,702        2,928        2,722            1            1
Virginia (VA)...................................        1,189        1,193        1,034          450        1,139          944            1            1
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[[Page 51628]]

Assessment Payment Options Recommendation

    The Board also recommended to include ``electronic submission'' in 
the list of allowable methods of payment to remit assessments and to 
remove references to drafts and money orders.
    The Board staff stated that allowing electronic submission (e.g., 
bank transfer payments (Automated Clearing House) (ACH) or wire 
transfer payments) of assessments would improve and streamline 
operations by lowering the cost of processing mailed checks. The Board 
recommended removing references to drafts and money orders as handlers 
no longer use these forms of payment.

Harmonized Tariff Schedule Table Recommendation

    Section 1207.510(b)(3) of the Plan contains a table that reflects 
outdated HTS codes, assessment rates, and potato categories for 
imports.
    Pursuant to Section 1207.327(b) of the Plan, the Board has the 
authority to recommend to the Secretary amendments to this Plan. To 
reduce Federal Register publication costs associated with amending the 
Plan to update HTS codes, the Board recommended removing the HTS chart 
from the Plan and replacing the HTS chart with a reference to HTS 
codes, assessment rates and potato categories for imports.
    The Secretary has chosen to adopt and propose an alternative 
approach that includes amending the Plan by updating the current HTS 
chart, and inserting new language to avoid future amendments to the 
Plan in the event that an HTS number subject to assessment reflected in 
the table is changed and such change is merely a replacement of a 
previous number. This proposed change will reduce future Federal 
Register publication costs associated with amending the Plan to remain 
consistent with future updated HTS numbers that have no impact on the 
description of potato involved.

Initial 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 proposed rule on 
small entities. Accordingly, AMS has considered the economic impact of 
this action on small 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 producers as those 
having annual receipts of no more than $1 million and small 
agricultural service firms (handlers) as those having annual receipts 
of no more than $30 million.
    According to the Board, there were 60 importers, 955 handlers, and 
approximately 2,500 producers and handlers in 2020.
    Most producers would be classified as small agricultural production 
businesses under the criteria established by the SBA (no more than $1 
million in annual potato sales). According to the 2017 Census of 
Agriculture, published by NASS in 2019, there were 16,554 potato farms 
with bearing acreage. Of these 16,554 farms, 1,417 sold potatoes whose 
annual market value met or exceeded $1 million. Based on these figures, 
91 percent of U.S. potato producers are considered to be ``small'' 
under the SBA standards. USDA recognizes the potential inclusion in its 
count of ``small'' farms those farms whose sales of potatoes were 
exactly $1 million in market value; however, USDA lacks the data to 
remedy this, and the number of farms who meet this criterion is likely 
quite small.
    This proposal would amend Sec. Sec.  1207.320, 1207.502, 1207.510 
and 1207.513.
    Regarding the economic impact of this proposed rule on affected 
entities, this action would impose no costs on producers, handlers, or 
importers. Proposed changes are administrative in nature and would 
allow the Board to effectively carry out the requirements of the Plan.
    In response to the discontinuation of NASS collection of potato 
production data for 10 States, USDA considered the following 
alternatives to the proposed amendment: Take no action and hold 
constant production level figures for the 10 States to the final year 
for which NASS published data; or, fund NASS' collection of data for 
the 10 States using Board resources. The first of these alternatives 
would result in the potential for Board representation that is 
inconsistent with domestic production. Potato production fluctuates 
significantly from year to year. Consequently, distribution of Board 
member seats based on a fixed production figure would prevent the Board 
from adequately reflecting changes that occur in the industry over 
time; therefore, this is not a viable alternative. The second 
alternative would result in an annual cost to the Board of 
approximately $80,000 to restore the collection of potato production 
data by NASS for the 10 States which it has omitted. This amount 
exceeds the total value of assessments collected from these 10 States, 
making this alternative not viable.
    In accordance with OMB regulation [5 CFR part 1320], which 
implements information collection requirements imposed by the Paperwork 
Reduction Act of 1995 [44 U.S.C. 3501 et seq.], there are no new 
requirements contained in this rule.
    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 proposed rule.
    AMS is committed to complying with the E-Government Act, to promote 
the use of the internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services.
    Regarding outreach efforts, all Board meetings were open to the 
public and interested persons were invited to participate and express 
their views. No concerns were raised.
    We have performed this initial RFA regarding the impact of this 
proposed action on small entities and we invite comments concerning 
potential effects of this action on small businesses.
    While this proposed rule as set forth below has not yet received 
the approval of USDA, it has been determined that it is consistent with 
and would effectuate the purposes of the Act.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposal. All written comments received in response to 
this proposed rule will be considered prior to finalizing this action.

List of Subjects in 7 CFR Part 1207

    Advertising, Agricultural research, Imports, Potatoes, Reporting 
and recordkeeping requirements.

    For reasons set forth in the preamble, 7 CFR part 1207 is proposed 
to be amended as follows:

PART 1207--POTATO RESEARCH AND PROMOTION PLAN

0
1. The authority citation for 7 CFR part 1207 continues to read as 
follows:

    Authority: 7 U.S.C. 2611-2627; 7 U.S.C. 7401.

0
2. Revise Sec.  1207.320(b) to read as follows:

[[Page 51629]]

Sec.  1207.320  Establishment and membership.

* * * * *
    (b) Producer membership on the Board shall be determined on the 
basis of potato production reported in the latest Crop Production 
Annual Summary Report issued by the National Agricultural Statistics 
Service of the U.S. Department of Agriculture. If a State's potato 
production data is not provided by the National Agricultural Statistics 
Service, the Board may use an alternative data source that reliably 
reflects potato production in the United States. Unless the Secretary, 
upon recommendation of the Board, determines an alternate basis, for 
each five million hundredweight of such production, or major fraction 
thereof, produced within each State, such State shall be entitled to 
one member. However, each State shall initially be entitled to at least 
one member.
* * * * *
0
3. Revise Sec.  1207.502(a) to read as follows:


Sec.  1207.502  Determination of membership.

    (a) Pursuant to Sec.  1207.320 and the recommendation of the Board, 
annual producer memberships on the Board shall be determined on the 
basis of the average potato production during the 3 preceding years in 
each State as set forth in the Crop Production Annual Summary Reports 
issued by the National Agricultural Statistics Service of the U.S. 
Department of Agriculture. If a State's potato production data is not 
provided by the National Agricultural Statistics Service, the Board may 
use an alternative data source that reliably reflects potato production 
in the United States.
* * * * *
0
4. Revise Sec.  1207.510 (b)(3) to read as follows:


Sec.  1207.510   Levy of assessments.

* * * * *
    (b) * * *
    (3) The Harmonized Tariff Schedule (HTS) categories and assessment 
rates on imported tablestock potatoes and frozen or processed potatoes 
for ultimate consumption by humans and on imported seed potatoes are 
listed in the following table. In the event that any HTS number subject 
to assessment is changed and such change is merely a replacement of a 
previous number and has no impact on the description of the potatoes, 
assessments will continue to be collected based on these new numbers.

                       Table 2 to Paragraph (b)(3)
------------------------------------------------------------------------
                                                    Assessment
Tablestock potatoes, frozen or processed -------------------------------
       potatoes, and seed potatoes           Cents/cwt       Cents/kg
------------------------------------------------------------------------
0701.10.0020............................             3.0           0.066
0701.10.0040............................             3.0           0.066
0701.90.1000............................             3.0           0.066
0701.90.5015............................             3.0           0.066
0701.90.5025............................             3.0           0.066
0701.90.5035............................             3.0           0.066
0701.90.5045............................             3.0           0.066
0701.90.5055............................             3.0           0.066
0701.90.5065............................             3.0           0.066
0710.10.0000............................             6.0           0.132
2004.10.4000............................             6.0           0.132
2004.10.8020............................             6.0           0.132
2004.10.8040............................             6.0           0.132
2005.20.0070............................           4.716           0.104
0712.90.3000............................          21.429           0.472
1105.10.0000............................          21.429           0.472
1105.20.0000............................          21.429           0.472
2005.20.0040............................          21.429           0.472
2005.20.0020............................          12.240            0.27
1108.13.0010............................            27.0           0.595
------------------------------------------------------------------------

* * * * *
0
5. Revise Sec.  1207.513 (c)(1) to read as follows:


Sec.  1207.513  Payment of assessments.

* * * * *
    (c) Payment directly to the Board. (1) Except as provided in 
paragraphs (b) and (d) of this section, each designated handler or 
importer shall remit assessments directly to the Board by check or 
electronic payment. Checks are to be made payable to the National 
Potato Promotion Board or the Board's official doing business as name. 
Payment is due not later than 10 days after the end of the month such 
assessment is due together with a report (preferably on Board forms) 
thereon.
* * * * *

Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2021-19676 Filed 9-15-21; 8:45 am]
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