[Federal Register: November 24, 2003 (Volume 68, Number 226)]
[Rules and Regulations]
[Page 65831-65833]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24no03-3]
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DEPARTMENT OF AGRICULTURE
Animal and Plant Health Inspection Service
9 CFR Part 77
[Docket No. 03-005-2]
Tuberculosis in Cattle and Bison; State Designations; California
AGENCY: Animal and Plant Health Inspection Service, USDA.
ACTION: Affirmation of interim rule as final rule.
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SUMMARY: We are adopting as a final rule, without change, an interim
rule that amended the regulations regarding State and zone
classifications by removing California from the list of accredited-free
States and adding it to the list of modified accredited advanced
States. The interim rule was necessary to help prevent the spread of
tuberculosis because California no longer meets the requirements for
accredited-free State status.
EFFECTIVE DATE: The interim rule became effective on April 25, 2003.
FOR FURTHER INFORMATION CONTACT: Dr. Terry Beals, Senior Staff
Veterinarian, Eradication and Surveillance Team, National Center for
Animal Health Programs, VS, APHIS, 4700 River Road Unit 43, Riverdale,
MD 20737-1231; (301) 734-5467.
SUPPLEMENTARY INFORMATION:
Background
In an interim rule effective and published in the Federal Register
on April 25, 2003 (68 FR 20333-20336, Docket No. 03-005-1), we amended
the tuberculosis regulations in 9 CFR part 77 (referred to below as the
regulations) by removing California from the list of
[[Page 65832]]
accredited-free States in Sec. 77.7 and adding it to the list of
modified accredited advanced States in Sec. 77.9.
Comments on the interim rule were required to be received on or
before June 24, 2003. We received three comments by that date. They
were from a State agricultural agency and two cattle industry groups.
The comments are discussed below by topic.
Tuberculosis Classification
Under the regulations in Sec. 77.7(c), if two or more
tuberculosis-affected herds are detected in an accredited-free State or
zone within a 48-month period, that State or zone will be removed from
the list of accredited-free States or zones and will be reclassified as
modified accredited advanced. All three commenters stated that a
classification system based solely on an absolute number of affected
herds does not sufficiently take into consideration State tuberculosis
mitigation and eradication efforts. We recognize this issue and are
currently preparing a proposed rule that will address this and other
aspects of the regulations.
Delay in Compliance
In our interim rule, we delayed California's compliance date for
certain identification requirements of the regulations for sexually
intact heifers, steers, and spayed heifers moving interstate from
California. We provided for this delay in recognition of the size and
complexity of the cattle industry in California as well as in the
interests of equitable treatment for producers in California since we
had previously delayed the State of Texas's date of compliance with
those requirements when we changed the classification of Texas from
accredited-free to modified accredited advanced (see 67 FR 38841-38844,
Docket No. 02-021-1, published June 6, 2002). The compliance date set
in our April 2003 interim rule was September 30, 2003, the same
compliance date given to the State of Texas. All three commenters
stated that the time allotted for delay in compliance was too short. On
August 8, 2003, we published a notice in the Federal Register (68 FR
47201-47202, Docket No. 03-072-1) further delaying the compliance date
for both States until March 30, 2004.
Additionally, one commenter stated that, although the delay in
compliance means that there are no Federally imposed identification
requirements for certain animals moving interstate, many States have
ignored the delay in compliance granted by the USDA. We are sensitive
to this issue and have sought to avoid such situations by holding
meetings among State veterinarians and other officials in an effort to
urge States to accept the Federal movement requirements.
Definitions
Among the requirements that we deferred as part of the delay in
compliance discussed previously are the identification and
certification requirements for sexually intact heifers found in Sec.
77.10(d). In our April 2003 interim rule, we described the
certification requirements as applying to ``sexually intact heifers
moving to unapproved feedlots.'' One commenter stated that since the
term ``unapproved feedlot'' is utilized but not defined in the
regulations, this creates ambiguity and makes it more difficult to
understand and uphold the delay in compliance. We apologize for any
confusion our use of the term ``unapproved feedlot,'' which does not
appear in the regulations, may have caused. In using the term, we were
simply attempting to draw a distinction between the requirements at
Sec. 77.10(b), which covers, in part, the movement of sexually intact
heifers to approved feedlots, and the requirements at Sec. 77.10(d),
which covers the movement of those and other animals to other
destinations, which could include feedlots that are not approved
feedlots.
Testing Costs
All three commenters expressed concern with the tuberculin testing
cost estimates provided in the interim rule's economic analysis. One
commenter stated that our determination that the identification
requirements described would not have a significant impact on a
substantial number of small entities was inaccurate. We are in the
process of gathering data related to testing and testing costs in order
to reevaluate our current information on those subjects. With regard to
the determination of no significant impact on a substantial number of
small entities, we consider ``significant impact'' to mean that the
cost of a given action is equal to or greater than the small business's
profit margin (5 to 10 percent of annual sales). By these standards,
given the size and profitability of the cattle industry in California,
this action does not represent a significant impact on a substantial
number of small entities. A more detailed analysis of this issue can be
found later in this document under the heading ``Regulatory Flexibility
Act.''
Therefore, for the reasons given in the interim rule and in this
document, we are adopting the interim rule as a final rule without
change.
This action also affirms the information contained in the interim
rule concerning Executive Orders 12866, 12372, and 12988 and the
Paperwork Reduction Act.
Further, for this action, the Office of Management and Budget has
waived its review under Executive Order 12866.
Regulatory Flexibility Act
This rule affirms an interim rule that amended the regulations by
removing California from the list of accredited-free States and adding
it to the list of modified accredited advanced States.
The following analysis addresses the economic effect of this rule
on small entities, as required by the Regulatory Flexibility Act.
On January 1, 2002, there were approximately 22,000 cattle and
bison operations in California, totaling 5.2 million head. According to
the National Agricultural Statistics Service, the total cash value of
cattle in California was over $4.8 billion as of that year. Over 90
percent of California's cattle operations yield less than $750,000
annually and are, therefore, considered small entities under criteria
established by the Small Business Administration.
The interim rule changed the tuberculosis status of California from
accredited-free to modified accredited advanced, resulting in
interstate movement restrictions where none existed previously.
Specifically, the regulations in Sec. 77.10 require that, for movement
to certain destinations, animals must test negative to an official
tuberculin test and/or be officially identified by premises of origin
identification before interstate movement is permitted.
The interim rule will prove beneficial by preventing the spread of
tuberculosis to other areas of the United States. However, the stricter
requirements for interstate movement will have an economic effect on
those producers involved in the interstate movement of cattle and bison
from California. As such, this analysis will focus on the expenses
incurred by those producers engaged in interstate movement and in
determining whether those negative impacts are significant.
The economic analysis prepared for the interim rule estimated the
costs of tuberculin testing to be approximately $3.76 per animal.
However, according to the California Department of Food and Agriculture
(CDFA), in conjunction with the California Cattleman's Association, the
estimated costs of tuberculosis testing are actually between $7.50 and
$10 per animal. Also, it is to be noted that the cost of the official
identification and applicator is borne by the USDA,
[[Page 65833]]
and the only costs incurred by producers are the labor costs of the
veterinarian associated with applying the eartag. As official
identification is customarily applied at the same time tuberculin tests
are performed and read, it is safe to assume that the estimated cost
between $7.50 and $10 would include the labor costs related to the
application of official identification.
On January 1, 2002, the average value per animal in California was
estimated to be $930, which translates to an average value per 101-head
herd of about $94,000. Using high-end cost estimates of $10 per animal
for tuberculosis testing and the cost of official identification, the
cost of the additional tuberculin testing necessitated by the interim
rule represents 1.1 percent of the per-head value of cattle. In general
practice, we assume a regulation that has compliance costs equal to or
greater than a small business' profit margin, or 5 to 10 percent of
annual sales, to pose an impact that can be considered ``significant.''
\1\ For the purposes of illustration and analysis of the small entity
impact, if we assume a cattle producer owns only 1 average sized-herd
of about 101 animals, with annual sales of approximately $94,000,
compliance costs totaling between $4,700 and $9,400 would qualify as
posing a ``significant'' economic impact on this entity. In this
example, the cost of compliance for this producer, using high-end
estimates and assuming all 101 animals are engaged in interstate
movement, would total only $1,010, which would not be considered a
``significant'' economic impact. Of course, in reality, the majority of
cattle and bison producers in California own more than one-average
sized herd. However, by presenting an extreme case of a small cattle or
bison operation, we may address and illustrate that compliance costs
will not cause a significant economic impact on small entities.
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\1\ Verkuil, Paul R. ``A Critical Guide to the Regulatory
Flexibility Act,'' Duke Law Journal, Apr. 1982: 928.
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Thus, we believe that the added cost of the required tuberculin
testing and identification is small relative to the average value of
cattle and bison, representing less than 1 percent of the per-head
value. In addition, the costs of compliance associated with the interim
rule will only affect those operations engaged in the interstate
movement of cattle or bison. Further, since APHIS has delayed the date
of compliance with the identification requirements in Sec. 77.10(b)
and (d), the identification costs for sexually intact heifers, steers,
and spayed heifers moving interstate from the State of California will
be deferred until at least March 30, 2004.
Under these circumstances, the Administrator of the Animal and
Plant Health Inspection Service has determined that this action will
not have a significant economic impact on a substantial number of small
entities.
List of Subjects in 9 CFR Part 77
Animal diseases, Bison, Cattle, Reporting and recordkeeping
requirements, Transportation, Tuberculosis.
PART 77--TUBERCULOSIS
0
Accordingly, we are adopting as a final rule, without change, the
interim rule that amended 9 CFR part 77 and that was published at 68 FR
20333-20336 on April 25, 2003.
Authority: 7 U.S.C. 8301-8317; 7 CFR 2.22, 2.80, and 371.4.
Done in Washington, DC, this 18th day of November, 2003.
Kevin Shea,
Acting Administrator, Animal and Plant Health Inspection Service.
[FR Doc. 03-29232 Filed 11-21-03; 8:45 am]
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