Exemption for Retail Store Operations

AGENCY:

Food Safety and Inspection Service, USDA.

ACTION:

Notice of adjusted dollar limitations.

SUMMARY:

The Food Safety and Inspection Service (FSIS) is announcing the new dollar limitations on the amount of sales of meat and meat food products and poultry products to hotels, restaurants, and similar institutions that do not disqualify a retail store for exemption from Federal inspection requirements. By reason of FSIS’ regulations, for calendar year 2004 the dollar limitation for meat and meat food products has been increased from $47,000 to $53,600 and for poultry products from $41,600 to $43,600. FSIS is increasing the dollar limitations from calendar year 2003 based on price changes for these products evidenced by the Consumer Price Index.

EFFECTIVE DATE:

This notice is effective April 30, 2004.

FOR FURTHER INFORMATION CONTACT:

John O'Connell, Directives and Economic Analysis Staff, Office of Policy, Program, and Employee Development, FSIS, U.S. Department of Agriculture, Room 112, Cotton Annex Building, 300 12th Street, SW., Washington, DC 20250-3700; telephone (202) 720-0345, fax (202) 690-0486.

SUPPLEMENTARY INFORMATION:

Background

The Federal Meat Inspection Act (21 U.S.C. 601 et seq.) and the Poultry Products Inspection Act (21 U.S.C. 451 et seq.) provide that the statutory provisions requiring inspection of the slaughter of livestock or poultry, and the preparation or processing of meat and meat food and poultry products, do not apply to operations of types traditionally and usually conducted at retail stores and restaurants, when conducted at any retail store or restaurant or similar retail-type establishment for sale in normal retail quantities (21 U.S.C. 454(c)(2) and 661 (c)(2)). In title 9 of the Code of Federal Regulations, §§ 303.1(d) and 381.10(d), FSIS regulations address the conditions under which requirements for inspection do not apply to retail operations involving the preparation or processing of meat or poultry products.

Under these regulations, sales to hotels, restaurants, and similar institutions disqualify a store for exemption if they exceed either of two maximum limits: 25 percent of the dollar value of total product sales or the calendar year dollar limitation set by the Administrator. The dollar limitation is adjusted automatically during the first quarter of the year if the Consumer Price Index (CPI), published by the Bureau of Labor Statistics, indicates an increase or decrease of more than $500 in the price of the same volume of product for the previous year. FSIS publishes a notice of the adjusted dollar limitations in the Federal Register. (See paragraphs (d)(2)(iii)(b) and (d)(2)(iii)(b) of §§ 303.1 and 381.10.)

The CPI for 2003 reveals an average annual price increase for meat and meat food products of 14 percent and an annual average price increase for poultry products of 4.7 percent. When rounded off to the nearest $100.00, the price increase for meat and meat food products is $6,600 and the price increase for poultry products is $2,000. Because the price of meat and meat food products and the price of poultry products have increased by more than $500, in accordance with §§ 303.1 (d)(2)(iii)(b) and 381.10 (d)(2)(iii)(b) of the regulations, FSIS is increasing the dollar limitation on sales to hotels, restaurants, and similar institutions to $53,600 for meat and meat food products and at $43,600 for poultry products for calendar year 2004.

Additional Public Notification

Public awareness of all segments of rulemaking and policy development is important. Consequently, in an effort to better ensure that the public, and in particular that minorities, women, and persons with disabilities are aware of this notice, FSIS will announce it online through the FSIS Web page located at http://www.fsis.usda.gov.

FSIS will also make copies of this Federal Register publication available through the FSIS Constituent Update, which is used to provide information regarding FSIS policies, procedures, regulations, Federal Register notices, FSIS public meetings, recalls, and any other types of information that could affect or would be of interest to our constituents and stakeholders. The update is communicated via Listserv, a free e-mail subscription service consisting of industry, trade, and farm groups, consumer interest groups, allied health professionals, scientific professionals, and other individuals that have requested to be included. The update is also available on the FSIS Web page. Through the Listserv and the Web page, FSIS is able to provide information to a much broader, more diverse audience.

For more information contact the Congressional and Public Affairs Office at (202) 720-9113. To be added to the free e-mail subscription service (Listserv) go to the Constituent Update” page on the Internet at http://www.fsis.usda.gov/oa/update/update.htm . Click on the “Subscribe to the Constituent Update Listserv” link, then fill out and submit the form.