[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