Industry waits for modified GIPSA rule proposal

by Bryan Salvage
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WASHINGTON – Last week, House and Senate conferees began negotiations on a three-bill appropriations package that will be the vehicle for a new continuing resolution to cover federal spending into December, stated the Nov. 4 edition of the National Chicken Council’s Washington Report. With federal funding set to expire on Nov. 18, appropriators from both the House and Senate indicated they are committed to pushing through a “minibus” containing three of the 12 fiscal year 2012 spending bills.

House Appropriations Chairman Hal Rogers (R-Ky.) said at the conference he would expect the conference committee to finish its work by Nov. 14 and that the House will vote on a final bill by Nov. 17. The minibus is made up of Agriculture; Commerce, Justice and Science; and Transportation, Housing and Urban Development.

Of great interest to the US meat and poultry industry is that the fiscal year 2012 Agriculture Appropriations bill contains language that would “defund” the Grain Inspection, Packers and Stockyards Administration (GIPSA) from proceeding with a proposed rule mandated by the 2008 farm bill. The appropriations language blocks the agency from publishing a final or interim final rule.

On Nov. 4, the US Department of Agriculture sent the proposed rule to the Office of Management and Budget (OMB), the agency that clears the proposed rule and sends it back to USDA as a final rule.

Posted on the OMB website were two notifications:

1. GIPSA Final Rule, Implementation of Regulations Required by the 2008 Farm Bill; Swine and Poultry Sample Contracts, Suspension of Delivery of Birds, Additional Capital Investment Criteria, Breach of Contract, and Arbitration.

2. GIPSA Interim Final Rule, Tournament Systems and Compensation.

Currently, it is unclear whether USDA will be able to get the rule back from OMB and publish it as final before the appropriators pass and President Obama signs the appropriations measure, according to NCC.

“We don’t have any official comment on the GIPSA changes just yet because we haven’t seen anything.....it’s all been word of mouth,” NCC’s new vice president of communications Tom Super told MEATPOULTRY.com.

Dave Warner, spokesperson for the National Pork Producers Council, said when asked to comment on this move: “We have to wait to see what the agency exactly proposes. We need to see what’s in their latest [communication].”

Janet Riley, American Meat Institute senior vice president public affairs and member services, iterated to MEATPOULTRY.com that although the modified version of the GIPSA proposed rule did go to OMB, the rule has not been published so reporting to date has been based upon sources and nothing official.

“We don't want to comment until we've seen the real deal,” she added.

Meanwhile, Jim Brownlee, communications coordinator, Office of Communications, USDA, told MEATPOULTRY.com: “There will be an announcement after OMB reviews what USDA sent them last week and a final rule and interim rule are sent to the Federal Register.”

Brownlee provided the following background on key pieces of this action:

  • Decisions about what to include in these rules and how to modify the contents have been guided by the comments received and the updated cost benefit analysis.
  • The Final Rule contains provisions required by the 2008 Farm Bill (the sections related to suspension of delivery of birds, additional capital investment criteria, breach of contract and arbitration) in addition to a section on swine and poultry sample contracts.
  • There will also be a separate Interim Rule, which contains a modified version of the section on poultry tournament systems and would be open to additional public comment.
  • USDA estimates show these two rules combined have a cost of less than $100 million.
  • There are several provisions from the original proposal that USDA is no longer pursuing, including the section on packer-to-packer sales and packer buyers and the records retention section.
  • The remaining provisions from the June 22, 2010 proposed rule remain under consideration.
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