[Federal Register Volume 67, Number 115 (Friday, June 14, 2002)]
[Proposed Rules]
[Pages 40876-40879]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 02-15058]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 987
[Docket No. FV02-987-1 PR]
Domestic Dates Produced or Packed in Riverside County, CA;
Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This rule would increase the assessment rate established for
the California Date Administrative Committee (Committee) for the 2002-
03 and subsequent crop years from $0.25 to $0.90 per hundredweight of
dates handled. The Committee locally administers the marketing order
that
[[Page 40877]]
regulates the handling of dates produced or packed in Riverside County,
California. Authorization to assess date handlers enables the Committee
to incur expenses that are reasonable and necessary to administer the
program. The crop year begins October 1 and ends September 30. The
assessment rate would remain in effect indefinitely unless modified,
suspended, or terminated.
DATES: Comments must be received by July 15, 2002.
ADDRESSES: Interested persons are invited to submit written comments
concerning this rule. Comments must be sent to the Docket Clerk,
Marketing Order Administration Branch, Fruit and Vegetable Programs,
AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC
20250-0237; Fax: (202) 720-8938, or E-mail: moab.docketclerk@usda.gov.
Comments should reference the docket number and the date and page
number of this issue of the Federal Register and will be available for
public inspection in the Office of the Docket Clerk during regular
business hours, or can be viewed at: http://www.ams.usda.gov/fv/
moab.html.
FOR FURTHER INFORMATION CONTACT: Toni Sasselli, Marketing Assistant, or
Richard P. Van Diest, Marketing Specialist, California Marketing Field
Office, Fruit and Vegetable Programs, AMS, USDA, 2202 Monterey St.,
suite 102B, Fresno, CA 93721; telephone: (559) 487-5901, Fax: (559)
487-5906; or George Kelhart, Technical Advisor, Marketing Order
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400
Independence Avenue, SW., STOP 0237, Washington, DC 20250-0237;
telephone: (202) 720-2491, Fax: (202) 720-8938.
Small businesses may request information on compliance with this
regulation by contacting Jay Guerber, Marketing Order Administration
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence
Avenue, SW., STOP 0237, Washington, DC 20250-0237; telephone: (202)
720-2491, Fax: (202) 720-8938, or E-mail: Jay.Guerber@usda.gov.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement and Order No. 987, both as amended (7 CFR part 987),
regulating the handling of domestic dates produced or packed in
Riverside County, California, hereinafter referred to as the ``order.''
The marketing agreement and order are effective under the Agricultural
Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674),
hereinafter referred to as the ``Act.''
The Department of Agriculture (USDA) is issuing this rule in
conformance with Executive Order 12866.
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. Under the marketing order now in effect, California
date handlers are subject to assessments. Funds to administer the order
are derived from such assessments. It is intended that the assessment
rate as proposed herein will be applicable to all assessable dates
beginning on October 1, 2002, and continue until amended, suspended, or
terminated. This rule will not preempt any State or local laws,
regulations, or policies, unless they present an irreconcilable
conflict with this rule.
The Act provides that administrative proceedings must be exhausted
before parties may file suit in court. Under section 608c(15)(A) of the
Act, any handler subject to an order may file with USDA a petition
stating that the order, any provision of the order, or any obligation
imposed in connection with the order is not in accordance with law and
request a modification of the order or to be exempted therefrom. Such
handler is afforded the opportunity for a hearing on the petition.
After the hearing USDA would rule on the petition. The Act provides
that the district court of the United States in any district in which
the handler is an inhabitant, or has his or her principal place of
business, has jurisdiction to review USDA's ruling on the petition,
provided an action is filed not later than 20 days after the date of
the entry of the ruling.
This rule would increase the assessment rate established for the
Committee for the 2002-03 and subsequent crop years from $0.25 to $0.90
per hundredweight of assessable dates handled.
The California date marketing order provides authority for the
Committee, with the approval of USDA, to formulate an annual budget of
expenses and collect assessments from handlers to administer the
program. The members of the Committee are producers and producer-
handlers of California dates. They are familiar with the Committee's
needs and with the costs for goods and services in their local area and
are thus in a position to formulate an appropriate budget and
assessment rate. The assessment rate is formulated and discussed at a
public meeting. Thus, all directly affected persons have an opportunity
to participate and provide input.
For the 2001-02 and subsequent crop years, the Committee
recommended, and USDA approved, an assessment rate that would continue
in effect from crop year to crop year unless modified, suspended, or
terminated by USDA upon recommendation and information submitted by the
Committee or other information available to USDA.
The Committee met on April 8, 2002, and unanimously recommended
2002-03 expenditures of $273,450 and an assessment rate of $0.90 per
hundredweight of dates handled. In comparison, last year's budgeted
expenditures were $90,800. The recommended assessment rate of $0.90 is
$0.65 higher than the rate currently in effect. The higher assessment
rate is needed to fund the industry's marketing and promotion programs
under the Committee budget. These programs have been implemented under
a State marketing order. However, the date industry concluded that it
was in its best interest to implement the programs under the Federal
marketing order because recent court actions have been filed against
several California State marketing orders under which similar programs
have been implemented.
Proceeds from the sales of cull dates are usually deposited in a
surplus account for subsequent use by the Committee in covering the
surplus pool share of the Committee's expenses. Handlers may also
dispose of cull dates of their own production within their own
livestock-feeding operation; otherwise, such cull dates must be shipped
or delivered to the Committee for sale to non-human food product
outlets.
Last year, the Committee applied $5,000 of surplus account monies
to cover surplus pool expenses. Based on a recent trend of declining
sales of cull dates over the past few years and reduced surplus pool
costs, the Committee decided not to apply any of the surplus pool funds
toward the 2002-03 Committee budget. The Committee, instead,
recommended assessing handlers for the full amount of the increased
budget that includes marketing and promotion programs.
The budgeted administrative expenses for the 2002-03 year include
$123,450 for labor and office expenses. This compares to $90,800 in
budgeted expenses in 2000-01. In addition, $150,000 has been budgeted
for marketing and promotion under the program for the 2002-03 crop
year.
The assessment rate of $0.90 per hundredweight of assessable dates
was derived by applying the following formula where:
A=Administrative Reserve ($39,450 of the anticipated $50,000
Administrative Reserve)
[[Page 40878]]
B=2002-03 expected shipments (260,000 hundredweight in pounds)
C=2002-03 expenses ($273,450); (C-A) / B=$0.90 per hundredweight.
Estimated shipments should provide $234,000 in assessment income.
Income derived from handler assessments and the administrative reserves
would be adequate to cover budgeted expenses. Funds in the reserve are
expected to total about $10,550 by September 30, 2003, and therefore
would be less than the maximum permitted by the order (not to exceed 50
percent of the average of expenses incurred during the most recent five
preceding crop years; Sec. 987.72(c)).
The proposed assessment rate would continue in effect indefinitely
unless modified, suspended, or terminated by the Secretary upon
recommendation and information submitted by the Committee or other
available information.
Although this assessment rate would be in effect for an indefinite
period, the Committee would continue to meet prior to or during each
crop year to recommend a budget of expenses and consider
recommendations for modification of the assessment rate. The dates and
times of Committee meetings are available from the Committee or USDA.
Committee meetings are open to the public and interested persons may
express their views at these meetings. USDA would evaluate Committee
recommendations and other available information to determine whether
modification of the assessment rate is needed. Further rulemaking would
be undertaken as necessary. The Committee's 2002-03 budget and those
for subsequent crop years would be reviewed and, as appropriate,
approved by the USDA.
Initial Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA), the Agricultural Marketing Service (AMS) has considered the
economic impact of this rule on small entities. Accordingly, AMS has
prepared this initial regulatory flexibility analysis.
The purpose of the RFA is to fit regulatory actions to the scale of
business subject to such actions in order that small businesses will
not be unduly or disproportionately burdened. Marketing orders issued
pursuant to the Act, and the rules issued thereunder, are unique in
that they are brought about through group action of essentially small
entities acting on their own behalf. Thus, both statutes have small
entity orientation and compatibility.
There are approximately 100 producers of dates in the production
area and approximately 9 handlers subject to regulation under the
marketing order. Small agricultural producers are defined by the Small
Business Administration (13 CFR 121.201) as those having annual
receipts of less than $750,000, and small agricultural service firms
are defined as those having annual receipts are less than $5,000,000.
Five of the 9 handlers (55 percent) shipped over $5,000,000 of dates
and could be considered large handlers by the Small Business
Administration. Four of the 9 handlers (45 percent) shipped under
$5,000,000 of dates and could be considered small handlers. The
majority of California date producers may be classified as small
entities.
This rule would increase the assessment rate established for the
Committee and collected from handlers for the 2002-03 and subsequent
crop years from $0.25 to $0.90 per hundredweight of assessable dates
handled. The Committee unanimously recommended 2002-03 expenditures of
$273,450 and the $0.90 per hundredweight assessment rate. The proposed
assessment rate of $0.90 is $0.65 higher than the rate currently in
effect. The quantity of assessable dates for the 2002-03-crop year is
estimated at 260,000 hundredweight. Thus, the $0.90 per hundredweight
rate should provide $234,000 in assessment income and, together with
the administrative reserve funds available to the Committee, be
adequate to meet this year's expenses.
The higher assessment rate is needed to fund marketing and
promotion programs under the Committee budget. The programs have been
implemented under a State marketing order for several years. However,
because of legal challenges recently brought against several State
marketing order programs implementing marketing and promotion programs,
the date industry has decided to implement these programs under the
Federal marketing order.
In addition, proceeds from the sales of cull dates are usually
deposited in a surplus account for subsequent use by the Committee in
covering the surplus pool share of the Committee's expenses. Handlers
may also dispose of cull dates of their own production within their own
livestock-feeding operation; otherwise, such cull dates must be shipped
or delivered to the Committee for sale to non-human food product
outlets. The Committee anticipates a reduction in surplus funds
available to the Committee from the sale of cull dates. As a
consequence, it decided to fund all of the Committee's expenses with
assessment funds during 2002-03.
The budgeted administrative expenses for the 2002-03 year include
$123,450 for labor and office expenses. This compares to $90,800 in
budgeted expenses in 2000-01. In addition, $150,000 has been budgeted
for marketing and promotion under the marketing order for the 2002-03
crop year.
The Committee reviewed and unanimously recommended 2002-03
expenditures of $273,450, which include marketing and promotion
programs. Prior to arriving at this budget, the Committee considered
alternative expenditure levels, including a proposal to not have a
budget. The assessment rate of $0.90 per hundredweight of assessable
dates was then determined by applying the following formula where:
A=Administrative Reserve ($39,450 of the anticipated $50,000
Administrative Reserve)
B=2002-03 expected shipments (260,000 hundredweight in pounds)
C=2002-03 expenses ($273,450); (C - A) / B=$0.90 per hundredweight.
Estimated shipments should provide $234,000 in assessment income.
Income derived from handler assessments and the administrative reserves
would be adequate to cover budgeted expenses. Funds in the
administrative reserve are expected to total about $10,550 by September
30, 2003, and therefore would be less than the maximum permitted by the
order (not to exceed 50 percent of the average of expenses incurred
during the most recent five preceding crop years; Sec. 987.72(c)).
A review of historical information and preliminary information
pertaining to the upcoming crop year indicates that the grower price
for the 2002-03 season could range between $30 and $75 per
hundredweight of dates. Therefore, the estimated assessment revenue for
the 2002-03 crop year as a percentage of total grower revenue could
range between 1 and 3 percent.
This action would increase the assessment obligation imposed on
handlers under the Federal marketing order. While assessments impose
some additional costs on handlers under the Federal marketing order,
the costs are minimal and uniform on all handlers. Some of the
additional costs may be passed on to producers. However, these costs
would be offset by the benefits derived by the operation of the
marketing order. In addition, the Committee's meeting was widely
publicized throughout the California date industry, and all interested
persons were invited to attend the meeting and participate in Committee
deliberations
[[Page 40879]]
on all issues. Like all Committee meetings, the April 8, 2002 meeting
was a public meeting and all entities, both large and small, were able
to express views on this issue. Finally, interested persons are invited
to submit information on the regulatory and informational impacts of
this action on small businesses.
This proposed rule would impose no additional reporting or
recordkeeping requirements on either small or large California date
handlers. As with all Federal marketing order 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 rule.
A small business guide on complying with fruit, vegetable, and
specialty crop marketing agreements and orders may be viewed at: http//
www.ams.usda.gov/fv/moab.html. Any questions about the compliance guide
should be sent to Jay Guerber at the previously mentioned address in
the FOR FURTHER INFORMATION CONTACT section.
Interested persons may comment on this proposed rule through July
15, 2002. The date of July 15, 2002, is deemed appropriate because: (1)
The 2002-03 crop year begins on October 1, 2002, and the marketing
order requires that the rate of assessment for each crop year apply to
all assessable dates handled during such crop year; (2) the Committee
needs to have sufficient funds to pay its expenses which are incurred
on a continuous basis; and (3) handlers are aware of this action which
was unanimously recommended by the Committee at a public meeting and is
similar to other assessment rate actions issued in past years.
List of Subjects in 7 CFR Part 987
Dates, Marketing agreements, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 987 is
proposed to be amended as follows:
PART 987--DOMESTIC DATES PRODUCED OR PACKED IN RIVERSIDE COUNTY,
CALIFORNIA
1. The authority citation for 7 CFR part 987 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. Section 987.339 is revised to read as follows:
Sec. 987.339 Assessment rate.
On and after October 1, 2002, an assessment rate of $0.90 per
hundredweight is established for California dates.
Dated: June 10, 2002.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 02-15058 Filed 6-13-02; 8:45 am]
BILLING CODE 3410-02-P