Cotton Board Rules and Regulations; Adjusting Supplemental Assessment on Imports (2008 Amendments)
Federal Register: July 24, 2008 (Volume 73, Number 143)
Proposed Rules
Page 43166-43171
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
DOCID:fr24jy08-17
Page 43166
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service 7 CFR Part 1205
Doc. AMS-CN-08-0040; CN-08-002
Cotton Board Rules and Regulations: Adjusting Supplemental
Assessment on Imports (2008 Amendments)
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
SUMMARY: The Agricultural Marketing Service (AMS) is proposing to amend the Cotton Board Rules and Regulations by increasing the value assigned to imported cotton for calculating supplemental assessments collected for use by the Cotton Research and Promotion Program. An amendment is required to adjust the assessments collected on imported cotton and the cotton content of imported products to be the same as those paid on domestically produced cotton. In addition, AMS proposes to remove
Harmonized Tariff Schedule (HTS) numbers that were absorbed into other
HTS categories since the last assessment adjustment.
DATES: Comments must be received on or before September 22, 2008.
ADDRESSES: Interested persons are invited to submit written comments concerning this proposed rule to Shethir M. Riva, Chief, Research and
Promotion Staff, Cotton and Tobacco Programs, AMS, USDA, Stop 0224, 1400 Independence Ave., SW., Room 2639-S, Washington, DC 20250-0224.
Comments should be submitted in triplicate. Comments may also be submitted electronically through www.regulations.gov. All comments received will be made available for public inspection at Cotton and
Tobacco Programs, AMS, USDA, Stop 0224, 1400 Independence Ave., SW.,
Room 2639-S, Washington, DC 20250-0224 during regular business hours.
FOR FURTHER INFORMATION CONTACT: Shethir M. Riva, Chief, Research and
Promotion Staff, Cotton and Tobacco Programs, AMS, USDA, Stop 0224, 1400 Independence Ave., SW., Room 2639-S, Washington, DC 20250-0224, telephone (202) 720-6603, facsimile (202) 690-1718, or e-mail at
Shethir.Riva@usda.gov.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
The Office of Management and Budget has waived the review process required by Executive Order 12866 for this action.
Executive Order 12988
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. It is not intended to have retroactive effect.
This proposed rule would not preempt any state or local laws, regulations, or policies, unless they present an irreconcilable conflict with this rule.
The Cotton Research and Promotion Act provides that administrative proceedings must be exhausted before parties may file suit in court.
Under Section 12 of the Act, any person subject to an order may file with the Secretary a petition stating that the order, any provision of the plan, or any obligation imposed in connection with the order is not in accordance with law and requesting a modification of the order or to be exempted therefrom. Such person is afforded the opportunity for a hearing on the petition. After the hearing, the Secretary would rule on the petition. The Act provides that the District Court of the United
States in any district in which the person is an inhabitant, or has his principal place of business, has jurisdiction to review the Secretary's ruling, provided a complaint is filed within 20 days from the date of the entry of ruling.
Background
The Cotton Research and Promotion Act Amendments of 1990 enacted by
Congress under Subtitle G of Title XIX of the Food, Agriculture,
Conservation, and Trade Act of 1990 on November 28, 1990, contained two provisions that authorized changes in the funding procedures for the
Cotton Research and Promotion Program.
These provisions are: (1) The assessment of imported cotton and cotton products; and (2) termination of the right of cotton producers to demand a refund of assessments.
An amended, the Cotton Research and Promotion Order was approved by producers and importers voting in a referendum held July 17-26, 1991, and the amended Order was published in the Federal Register on December 10, 1991 (56 FR 64470). A proposed rule implementing the amended Order was published in the Federal Register on December 17, 1991 (56 FR 65450). Implementing rules were published on July 1 and 2, 1992 (57 FR 29181) and (57 FR 29431), respectively.
The last time AMS proposed to amend the Cotton Board Rules and
Regulations, specifically to adjust the total rate of assessment per kilogram of imported cotton collected under the Cotton Research and
Promotion Program, was on January 12, 2005 (70 FR 2034). This proposed rule resulted from years of consultation with the industry. In the proposed rule, the total rate of assessment would have been calculated by adding together the $1 per bale equivalent assessment and the supplemental assessment, and adjusting the sum to account for the estimated amount of U.S. cotton contained in the imported textile products by the estimated average amount of U.S. cotton contained therein. On November 20, 2006, however, AMS withdrew the proposed rule
(71 FR 67072) based on a stakeholder comment questioning the data and the calculation of the proposed importer supplemental assessment. After receiving the comment and other available information, the agency did not believe that the proposed rule would achieve its intended objectives of effectiveness and efficiency. While AMS continues to evaluate this issue and garner additional stakeholders' input and economic data, AMS is proposing to amend the Cotton Board Rules and
Regulations to adjust the importer supplemental assessment to be the same as that levied on domestic cotton producers. This proposed rule would increase the value assigned to imported cotton in the Cotton
Board Rules and Regulations (7 CFR 1205.510(b)(2)). The total value is determined by a two-part assessment. The first part of the assessment is levied on the weight of cotton produced or imported at a rate of $1 per bale of cotton, which is equivalent to 500 pounds, or $1 per 226.8 kilograms of cotton. The second value is used to calculate the supplemental assessments on imported cotton and the cotton content of imported products. Supplemental assessments are levied at a rate of five-tenths of one percent of the value of domestically produced cotton, imported cotton, and the cotton content of imported products.
The supplement assessment is combined with the per bale equivalent to determine the total value and assessment of the imported cotton or cotton-containing products.
The Cotton Research and Promotion Rules and Regulations provide for assigning the calendar year weighted average price received by U.S. farmers for Upland cotton to represent the value of imported cotton.
This is so that the assessment on domestically produced cotton and the assessment on imported cotton and the cotton content of imported products is the same. The source for the average price statistic is
Agricultural Prices, a publication of the National Agricultural
Statistics Service
Page 43167
(NASS) of the Department of Agriculture. Use of the weighted average price figure in the calculation of supplemental assessments on imported cotton and the cotton content of imported products will yield an assessment that is the same as assessments paid on domestically produced cotton.
The current value of imported cotton as published in the Federal
Register (68 FR 27898) for the purpose of calculating supplemental assessments on imported cotton is $0.8267 cents per kilogram. Using the
Average Weighted Price received by U.S. farmers for Upland cotton for the calendar year 2007, the new value of imported cotton is $0.9874 cents per kilogram or $0.1607 cents per kilogram more than the previous value.
An example of the complete assessment formula and how the figures are obtained is as follows:
One bale is equal to 500 pounds.
One kilogram equals 2.2046 pounds.
One pound equals 0.453597 kilograms.
One Dollar Per Bale Assessment Converted to Kilograms
A 500-pound bale equals 226.8 kg. (500 x .453597).
$1 per bale assessment equals $0.002000 per pound (1/500) or
$0.004409 per kg. (1/226.8).
Supplemental Assessment of 5/10 of One Percent of the Value of the
Cotton Converted to Kilograms.
The 2007 calendar year weighted average price received by producers for Upland cotton is $0.496 per pound or $1.093 per kg. (0.496 x 2.2046).
Five tenths of one percent of the average price in kg. equals
$0.005465 per kg. (1.093 x .005).
Total Assessment
The total assessment per kilogram of raw cotton is obtained by adding the $1 per bale equivalent assessment of $0.004409 per kg. and the supplemental assessment $0.005465 per kg. which equals $0.009874 per kg.
The current assessment on imported cotton is $0.008267 per kilogram of imported cotton. The proposed assessment is $0.009874, an increase of $0.001607 per kilogram. This increase reflects the increase in the
Average Weighted Price of Upland Cotton Received by U.S. Farmers during the period January through December 2007.
Since the value of cotton is the basis of the supplemental assessment calculation and the figures shown in the right hand column of the Import Assessment Table 1205.510(b) (3) are a result of such a calculation, the figures in this table have been revised. These figures indicate the total assessment per kilogram due for each HTS numbers subject to assessment.
The U.S. Customs and Border Protection informed the agency that several numbers listed in the Import Assessment Table are no longer used or have been combined with other HTS numbers. The HTS numbers that have been removed from the Import Assessment Table are: 5208530000; 6109100005; 6203424005; 6203424050; 6204624040; 6205202030; 6206303020; 5210120000; 6109100009; 6203424010; 6203424055; 6204624045; 6205202035; 6206303030; 5211210025; 6110202065; 6203424015; 6203424060; 6204624050; 6205202046; 6206303040; 5211210035; 6110202075; 6203424020; 6204624005; 6204624055; 6205202050; 6206303050; 5211210050; 6111206040; 6203424025; 6204624010; 6204624060; 6205202060; 6206303060; 5211290090; 6111305040; 6203424030; 6204624020; 6204624065; 6205202065; 6210405020; 5604900000; 6115198010; 6203424035; 6204624025; 6205202015; 6205202070; 6303110000; 5702991010; 6115929000; 6203424040; 6204624030; 6205202020; 6205202075; 5702991090; 6115936020; 6203424045; 6204624035; 6205202025; 6206303010.
A 60-day comment period is provided to comment on the changes to the Cotton Board Rules and Regulations proposed herein. This period is deemed appropriate because this proposal would increase the assessments paid by importers under the Cotton Research and Promotion Order.
Accordingly, the change proposed in this rule, if adopted, should be implemented as soon as possible.
Regulatory Flexibility Act
In accordance with the Regulatory Flexibility Act (RFA) [5 U.S.C. 601 et seq.], AMS has examined the economic impact of this rule on small entities. The purpose of the RFA is to fit regulatory actions to the scale of businesses subject to such action so that small businesses will not be unduly or disproportionately burdened. The Small Business
Administration defines, in 13 CFR Part 121, small agricultural producers as those having annual receipts of no more than $750,000 and small agricultural service firms (importers) as having receipts of no more than $6,500,000. An estimated 13,000 importers are subject to the rules and regulations issued pursuant to the Cotton Research and
Promotion Order. Most are considered small entities as defined by the
Small Business Administration.
This proposed rule would only affect importers of cotton and cotton-containing products and would raise the assessments paid by the importers under the Cotton Research and Promotion Order. The current assessment on imported cotton is $0.008267 per kilogram of imported cotton. The proposed assessment is $0.009874, an increase of $0.001607, which was calculated based on the 12-month average of monthly weighted average prices received by U.S. cotton farmers. The calculation, and, thus the increase, is dictated by the Cotton Research and Promotion
Rules and Regulations, 7 CFR 1205.510. Section 1205.510, ``Levy of assessments'', indicates that ``the rate of the supplemental assessment on imported cotton will be the same as that levied on cotton produced within the United States.'' In addition, section 1205.510 provides that the 12-month average of monthly weighted average prices received by
U.S. farmers will be used as the value of imported cotton for the purpose of levying the supplemental assessment on imported cotton.
Under the Cotton Research and Promotion Program, assessments are used by the Cotton Board to finance research and promotion programs designed to increase consumer demand for Upland cotton in the United
States and international markets. In 2007, producer assessments totaled
$44 million and importer assessments totaled $30.4 million. According to the Cotton Board, should the volume of cotton products imported into the U.S. remain at the same level in 2007, one could expect the increased assessment to generate approximately $5.9 million.
Importers with line-items appearing on U.S. Customs and Border
Protection documentation with value of the cotton contained therein results of an assessment of two dollars ($2.00) or less will not be subject to assessments. In addition, imported cotton and products may be exempt from assessment if the cotton content of products is U.S. produced, cotton other than Upland, or imported products that are eligible to be labeled as 100 percent organic under the National
Organic Program (7 CFR Part 205) and who is not a split operation.
The rule does not impose additional recordkeeping requirements on importers.
There are no Federal rules that duplicate, overlap, or conflict with this rule.
Paperwork Reduction
In compliance with Office of Management and Budget (OMB) regulations (5 CFR Part 1320) which implement the Paperwork Reduction
Act (PRA) (44 U.S.C. 3501 et seq.) the information collection requirements
Page 43168
contained in the regulation to be amended have been previously approved by OMB and were assigned control number 0581-0093. This rule does not result in a change to the information collection and recordkeeping requirements previously approved.
List of Subjects in 7 CFR Part 1205
Advertising, Agricultural research, Cotton, Marketing agreements,
Reporting and Recordkeeping requirements.
For the reasons set forth in the preamble 7 CFR part 1205 is proposed to be amended as follows:
PART 1205--COTTON RESEARCH AND PROMOTION 1. The authority citation for Part 1205 continues to read as follows:
Authority: 7 U.S.C. 2101-2118. 2. In Sec. 1205.510, paragraph (b)(2) and the table in paragraph
(b)(3)(ii) are revised to read as follows:
Sec. 1205.510 Levy of assessments.
* * * * *
(b) * * *
(2) The 12-month average of monthly weighted average prices received by U.S. farmers will be calculated annually. Such weighted average will be used as the value of imported cotton for the purpose of levying the supplemental assessment on imported cotton and will be expressed in kilograms. The value of imported cotton for the purpose of levying this supplemental assessment is $0.9874 cents per kilogram.
(3) * * *
(ii) * * *
Import Assessment Table
(Raw Cotton Fiber)
HTS No.
Conv. fact. Cents/kg.
5201000500...................................
0
0.9874 5201001200...................................
0
0.9874 5201001400...................................
0
0.9874 5201001800...................................
0
0.9874 5201002200...................................
0
0.9874 5201002400...................................
0
0.9874 5201002800...................................
0
0.9874 5201003400...................................
0
0.9874 5201003800...................................
0
0.9874 5204110000...................................
1.1111
1.0971 5204200000...................................
1.1111
1.0971 5205111000...................................
1.1111
1.0971 5205112000...................................
1.1111
1.0971 5205121000...................................
1.1111
1.0971 5205122000...................................
1.1111
1.0971 5205131000...................................
1.1111
1.0971 5205132000...................................
1.1111
1.0971 5205141000...................................
1.1111
1.0971 5205210020...................................
1.1111
1.0971 5205210090...................................
1.1111
1.0971 5205220020...................................
1.1111
1.0971 5205220090...................................
1.1111
1.0971 5205230020...................................
1.1111
1.0971 5205230090...................................
1.1111
1.0971 5205240020...................................
1.1111
1.0971 5205240090...................................
1.1111
1.0971 5205310000...................................
1.1111
1.0971 5205320000...................................
1.1111
1.0971 5205330000...................................
1.1111
1.0971 5205340000...................................
1.1111
1.0971 5205410020...................................
1.1111
1.0971 5205410090...................................
1.1111
1.0971 5205420020...................................
1.1111
1.0971 5205420090...................................
1.1111
1.0971 5205440020...................................
1.1111
1.0971 5205440090...................................
1.1111
1.0971 5206120000...................................
0.5556
0.5486 5206130000...................................
0.5556
0.5486 5206140000...................................
0.5556
0.5486 5206220000...................................
0.5556
0.5486 5206230000...................................
0.5556
0.5486 5206240000...................................
0.5556
0.5486 5206310000...................................
0.5556
0.5486 5207100000...................................
1.1111
1.0971 5207900000...................................
0.5556
0.5486 5208112020...................................
1.1455
1.1311 5208112040...................................
1.1455
1.1311 5208112090...................................
1.1455
1.1311 5208114020...................................
1.1455
1.1311 5208114060...................................
1.1455
1.1311 5208114090...................................
1.1455
1.1311 5208118090...................................
1.1455
1.1311 5208124020...................................
1.1455
1.1311 5208124040...................................
1.1455
1.1311 5208124090...................................
1.1455
1.1311 5208126020...................................
1.1455
1.1311 5208126040...................................
1.1455
1.1311 5208126060...................................
1.1455
1.1311 5208126090...................................
1.1455
1.1311 5208128020...................................
1.1455
1.1311 5208128090...................................
1.1455
1.1311 5208130000...................................
1.1455
1.1311 5208192020...................................
1.1455
1.1311 5208192090...................................
1.1455
1.1311 5208194020...................................
1.1455
1.1311 5208194090...................................
1.1455
1.1311 5208196020...................................
1.1455
1.1311 5208196090...................................
1.1455
1.1311 5208224040...................................
1.1455
1.1311 5208224090...................................
1.1455
1.1311 5208226020...................................
1.1455
1.1311 5208226060...................................
1.1455
1.1311 5208228020...................................
1.1455
1.1311 5208230000...................................
1.1455
1.1311 5208292020...................................
1.1455
1.1311 5208292090...................................
1.1455
1.1311 5208294090...................................
1.1455
1.1311 5208296090...................................
1.1455
1.1311 5208298020...................................
1.1455
1.1311 5208312000...................................
1.1455
1.1311 5208321000...................................
1.1455
1.1311 5208323020...................................
1.1455
1.1311 5208323040...................................
1.1455
1.1311 5208323090...................................
1.1455
1.1311 5208324020...................................
1.1455
1.1311 5208324040...................................
1.1455
1.1311 5208325020...................................
1.1455
1.1311 5208330000...................................
1.1455
1.1311 5208392020...................................
1.1455
1.1311 5208392090...................................
1.1455
1.1311 5208394090...................................
1.1455
1.1311 5208396090...................................
1.1455
1.1311 5208398020...................................
1.1455
1.1311 5208412000...................................
1.1455
1.1311 5208416000...................................
1.1455
1.1311 5208418000...................................
1.1455
1.1311 5208421000...................................
1.1455
1.1311 5208423000...................................
1.1455
1.1311 5208424000...................................
1.1455
1.1311 5208425000...................................
1.1455
1.1311 5208430000...................................
1.1455
1.1311 5208492000...................................
1.1455
1.1311 5208494020...................................
1.1455
1.1311 5208494090...................................
1.1455
1.1311 5208496010...................................
1.1455
1.1311 5208496090...................................
1.1455
1.1311 5208498090...................................
1.1455
1.1311 5208512000...................................
1.1455
1.1311 5208516060...................................
1.1455
1.1311 5208518090...................................
1.1455
1.1311 5208523020...................................
1.1455
1.1311 5208523045...................................
1.1455
1.1311 5208523090...................................
1.1455
1.1311 5208524020...................................
1.1455
1.1311 5208524045...................................
1.1455
1.1311 5208524065...................................
1.1455
1.1311 5208525020...................................
1.1455
1.1311 5208592025...................................
1.1455
1.1311 5208592095...................................
1.1455
1.1311 5208594090...................................
1.1455
1.1311 5208596090...................................
1.1455
1.1311 5209110020...................................
1.1455
1.1311 5209110035...................................
1.1455
1.1311 5209110090...................................
1.1455
1.1311 5209120020...................................
1.1455
1.1311 5209120040...................................
1.1455
1.1311 5209190020...................................
1.1455
1.1311 5209190040...................................
1.1455
1.1311 5209190060...................................
1.1455
1.1311 5209190090...................................
1.1455
1.1311 5209210090...................................
1.1455
1.1311 5209220020...................................
1.1455
1.1311 5209220040...................................
1.1455
1.1311 5209290040...................................
1.1455
1.1311 5209290090...................................
1.1455
1.1311 5209313000...................................
1.1455
1.1311 5209316020...................................
1.1455
1.1311 5209316035...................................
1.1455
1.1311 5209316050...................................
1.1455
1.1311 5209316090...................................
1.1455
1.1311 5209320020...................................
1.1455
1.1311 5209320040...................................
1.1455
1.1311 5209390020...................................
1.1455
1.1311 5209390040...................................
1.1455
1.1311 5209390060...................................
1.1455
1.1311 5209390080...................................
1.1455
1.1311 5209390090...................................
1.1455
1.1311 5209413000...................................
1.1455
1.1311 5209416020...................................
1.1455
1.1311 5209416040...................................
1.1455
1.1311 5209420020...................................
1.0309
1.0179 5209420040...................................
1.0309
1.0179 5209430030...................................
1.1455
1.1311 5209430050...................................
1.1455
1.1311 5209490020...................................
1.1455
1.1311 5209490090...................................
1.1455
1.1311 5209516035...................................
1.1455
1.1311 5209516050...................................
1.1455
1.1311 5209520020...................................
1.1455
1.1311
Page 43169
5209590025...................................
1.1455
1.1311 5209590040...................................
1.1455
1.1311 5209590090...................................
1.1455
1.1311 5210114020...................................
0.6873
0.6786 5210114040...................................
0.6873
0.6786 5210116020...................................
0.6873
0.6786 5210116040...................................
0.6873
0.6786 5210116060...................................
0.6873
0.6786 5210118020...................................
0.6873
0.6786 5210192090...................................
0.6873
0.6786 5210214040...................................
0.6873
0.6786 5210216020...................................
0.6873
0.6786 5210216060...................................
0.6873
0.6786 5210218020...................................
0.6873
0.6786 5210314020...................................
0.6873
0.6786 5210314040...................................
0.6873
0.6786 5210316020...................................
0.6873
0.6786 5210318020...................................
0.6873
0.6786 5210414000...................................
0.6873
0.6786 5210416000...................................
0.6873
0.6786 5210418000...................................
0.6873
0.6786 5210498090...................................
0.6873
0.6786 5210514040...................................
0.6873
0.6786 5210516020...................................
0.6873
0.6786 5210516040...................................
0.6873
0.6786 5210516060...................................
0.6873
0.6786 5211110090...................................
0.6873
0.6786 5211120020...................................
0.6873
0.6786 5211190020...................................
0.6873
0.6786 5211190060...................................
0.6873
0.6786 5211320020...................................
0.6873
0.6786 5211390040...................................
0.6873
0.6786 5211390060...................................
0.6873
0.6786 5211490020...................................
0.6873
0.6786 5211490090...................................
0.6873
0.6786 5211590025...................................
0.6873
0.6786 5212146090...................................
0.9164
0.9049 5212156020...................................
0.9164
0.9049 5212216090...................................
0.9164
0.9049 5509530030...................................
0.5556
0.5486 5509530060...................................
0.5556
0.5486 5513110020...................................
0.4009
0.3958 5513110040...................................
0.4009
0.3958 5513110060...................................
0.4009
0.3958 5513110090...................................
0.4009
0.3958 5513120000...................................
0.4009
0.3958 5513130020...................................
0.4009
0.3958 5513210020...................................
0.4009
0.3958 5513310000...................................
0.4009
0.3958 5514120020...................................
0.4009
0.3958 5516420060...................................
0.4009
0.3958 5516910060...................................
0.4009
0.3958 5516930090...................................
0.4009
0.3958 5601210010...................................
1.1455
1.1311 5601210090...................................
1.1455
1.1311 5601300000...................................
1.1455
1.1311 5602109090...................................
0.5727
0.5655 5602290000...................................
1.1455
1.1311 5602906000...................................
0.526
0.5194 5607909000...................................
0.8889
0.8777 5608901000...................................
1.1111
1.0971 5608902300...................................
1.1111
1.0971 5609001000...................................
1.1111
1.0971 5609004000...................................
0.5556
0.5486 5701104000...................................
0.0556
0.0549 5701109000...................................
0.1111
0.1097 5701901010...................................
1.0444
1.0312 5702109020...................................
1.1
1.0861 5702312000...................................
0.0778
0.0768 5702411000...................................
0.0722
0.0713 5702412000...................................
0.0778
0.0768 5702421000...................................
0.0778
0.0768 5702913000...................................
0.0889
0.0878 5703900000...................................
0.4489
0.4432 5801210000...................................
1.1455
1.1311 5801230000...................................
1.1455
1.1311 5801250010...................................
1.1455
1.1311 5801250020...................................
1.1455
1.1311 5801260020...................................
1.1455
1.1311 5802190000...................................
1.1455
1.1311 5802300030...................................
0.5727
0.5655 5804291000...................................
1.1455
1.1311 5806200010...................................
0.3534
0.3489 5806200090...................................
0.3534
0.3489 5806310000...................................
1.1455
1.1311 5806400000...................................
0.4296
0.4242 5808107000...................................
0.5727
0.5655 5808900010...................................
0.5727
0.5655 5811002000...................................
1.1455
1.1311 6001106000...................................
1.1455
1.1311 6001210000...................................
0.8591
0.8483 6001220000...................................
0.2864
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* * * * *
Authority: 7 U.S.C. 2101-2118.
Dated: July 21, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
FR Doc. E8-16957 Filed 7-23-08; 8:45 am
BILLING CODE 3410-02-P
