[Federal Register Volume 83, Number 167 (Tuesday, August 28, 2018)]
[Proposed Rules]
[Pages 43799-43801]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-18552]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 83, No. 167 / Tuesday, August 28, 2018 /
Proposed Rules
[[Page 43799]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 927
[Doc. No. AMS-SC-18-0048; SC18-927-1 PR]
Pears Grown in Oregon and Washington; Increased Assessment Rate
for Fresh Pears
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would implement a recommendation from the
Fresh Pear Committee (Committee) to increase the assessment rate
established for the 2018-2019 and subsequent fiscal periods. The
assessment rate would remain in effect indefinitely unless modified,
suspended, or terminated.
DATES: Comments must be received by September 27, 2018.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposed rule. Comments must be sent to the Docket
Clerk, Marketing Order and Agreement Division, Specialty Crops Program,
AMS, USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC
20250-0237; Fax: (202) 720-8938; or internet: http://www.regulations.gov. Comments should reference the document 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.regulations.gov. All comments submitted in response to this rule
will be included in the record and will be made available to the
public. Please be advised that the identity of the individuals or
entities submitting the comments will be made public on the internet at
the address provided above.
FOR FURTHER INFORMATION CONTACT: Barry Broadbent, Marketing Specialist,
or Gary Olson, Regional Director, Northwest Marketing Field Office,
Marketing Order and Agreement Division, Specialty Crops Program, AMS,
USDA; Telephone: (503) 326-2724, Fax: (503) 326-7440, or Email:
[email protected] or [email protected].
Small businesses may request information on complying with this
regulation by contacting Richard Lower, Marketing Order and Agreement
Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue
SW, STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-2491,
Fax: (202) 720-8938, or Email: [email protected].
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
proposes an amendment to regulations issued to carry out a marketing
order as defined in 7 CFR 900.2(j). This proposed rule is issued under
Marketing Order No. 927, as amended (7 CFR part 927), regulating the
handling of pears grown in Oregon and Washington. Part 927, (referred
to as ``the Order'') is effective under the Agricultural Marketing
Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter
referred to as the ``Act.'' The Committee locally administers the Order
and is comprised of growers and handlers operating within the area of
production, and a public member.
The Department of Agriculture (USDA) is issuing this proposed rule
in conformance with Executive Orders 13563 and 13175. This proposed
rule falls within a category of regulatory actions that the Office of
Management and Budget (OMB) exempted from Executive Order 12866 review.
Additionally, because this proposed rule does not meet the definition
of a significant regulatory action, it does not trigger the
requirements contained in Executive Order 13771. See OMB's Memorandum
titled ``Interim Guidance Implementing Section 2 of the Executive Order
of January 30, 2017, titled `Reducing Regulation and Controlling
Regulatory Costs' '' (February 2, 2017).
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. Under the Order now in effect, Oregon and
Washington pear handlers are subject to assessments. Funds to
administer the Order are derived from such assessments. It is intended
that the assessment rate would be applicable to all assessable pears
for the 2018-2019 fiscal period, and continue until amended, suspended,
or terminated.
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.
The 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 are
familiar with the Committee's needs and with the costs of goods and
services in their local area and are in a position to formulate an
appropriate budget and assessment rate. The assessment rate is
formulated and discussed in a public meeting where all directly
affected persons have an opportunity to participate and provide input.
This proposed rule would increase the assessment rate from $0.449
to $0.463 per 44-pound standard box or equivalent of fresh ``summer/
fall'' and ``winter'' pears handled for the 2018-2019 and subsequent
fiscal periods. The proposed higher rate is necessary to fully cover
the Committee's 2018-2019 fiscal period budgeted expenditures. The
Committee has had to draw from its monetary reserve to partially fund
program activities during the last two fiscal periods. Drawing from
reserves to fund operations on an on-going basis is not a sustainable
strategy. Therefore, increasing the continuing assessment rate would
allow the Committee to fully fund budgeted expenses and replenish its
financial reserve.
The Committee met on May 31, 2018, and unanimously recommended
2018-
[[Page 43800]]
2019 fiscal period expenditures of $9,213,133 and an assessment rate of
$0.463 per standard box or equivalent of fresh ``summer/fall'' and
``winter'' pears handled. In comparison, last year's budgeted
expenditures were $9,282,059. The proposed assessment rate of $0.463 is
$0.014 higher than the $0.449 rate currently in effect. The Committee
recommended the assessment rate increase because expenditures have
exceeded assessment revenue in the previous two fiscal periods.
The major expenditures recommended by the Committee for the 2018-
2019 fiscal period include $550,790 for contracted administration by
Pear Bureau Northwest, $190,700 for administrative expenses, $771,643
for production research and market development, and $7,700,000 for
promotion and paid advertising for both ``summer/fall'' and ``winter''
varieties of fresh pears. In comparison, major expenses for the 2017-
2018 fiscal period included $512,928 for contracted administration,
$232,200 for administrative expenses, $836,931 for production research
and market development, and $7,700,000 for promotion and paid
advertising.
The assessment rate recommended by the Committee was derived by
considering anticipated expenses, expected shipments, and the amount of
funds available in the authorized reserve. Income derived from handler
assessments of $9,260,000 (20 million standard boxes or equivalent at
$0.463 per box) would be adequate to cover budgeted expenses of
$9,213,133, with any excess funds used to replenish the Committee's
monetary reserve. Funds in the reserve (currently $1,096,332) would be
kept within the maximum permitted by Sec. 927.42(a) and would not
exceed the expenses of approximately one fiscal period.
The assessment rate proposed in this rule would continue in effect
indefinitely unless modified, suspended, or terminated by USDA 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
fiscal period 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 budget for subsequent
fiscal periods would be reviewed and, as appropriate, approved by USDA.
Initial Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS)
has considered the economic impact of this proposed 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
businesses 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.
There are approximately 827 growers of fresh pears in the
production area and approximately 38 handlers subject to regulation
under the Order. Small agricultural producers are defined by the Small
Business Administration (SBA) as those having annual receipts less than
$750,000, and small agricultural service firms are defined as those
whose annual receipts are less than $7,500,000 (13 CFR 121.201).
According to data from USDA Market News, the industry, and the
Committee, for the 2016-17 season, the weighted average f.o.b. price
for Oregon-Washington fresh pears was approximately $26.99 per standard
44-pound box. Total shipments for that period were 17,878,219 standard
boxes or equivalent. Using the number of handlers, and assuming a
normal distribution, the majority of handlers would have average annual
receipts of more than $7,500,000 ($26.99 per box times 17,878,219
equals $482,533,130 divided by 38 handlers equals $12,698,240 per
handler).
In addition, based on National Agricultural Statistics Service
data, the industry produced 441,950 tons of fresh pears in the
production area during the 2016-2017 season, with an average grower
price of $797 per ton. Based on the average grower price, production,
and the total number of Oregon-Washington fresh pear growers, and
assuming a normal distribution, the average annual grower revenue is
below $750,000 ($797 per ton times 441,950 tons equals $352,234,150
divided by 827 growers equals $425,918 per grower). Thus, the majority
of Oregon and Washington fresh pear handlers may be classified as large
entities, while the majority of growers may be classified as small
entities.
This proposal would increase the assessment rate collected from
handlers for the 2018-2019 and subsequent fiscal periods from $0.449 to
$0.463 per standard box or equivalent of Oregon and Washington fresh
``summer/fall'' and ``winter'' pears handled. The Committee unanimously
recommended 2018-2019 fiscal period expenditures of $9,213,133 and the
$0.463 per standard box or equivalent assessment rate. The proposed
assessment rate of $0.463 is $0.014 higher than the rate for the 2017-
2018 fiscal period. The quantity of assessable fresh ``summer/fall''
and ``winter'' pears for the 2018-2019 fiscal period is estimated at 20
million standard boxes or equivalent. Thus, the $0.463 rate should
provide $9,260,000 in assessment income. Income derived from handler
assessments would be adequate to cover budgeted expenses, with any
excess funds used to replenish the Committee's monetary reserve.
The major expenditures recommended by the Committee for the 2018-
2019 fiscal period include $550,790 for contracted administration by
Pear Bureau Northwest, $190,700 for administrative expenses, $771,643
for production research and market development, and $7,700,000 for
promotion and paid advertising for both ``summer/fall'' pears and
``winter'' pears. Budgeted expenses for these items in the 2017-2018
fiscal period were $512,928, $232,200, $836,931, and $7,700,000,
respectively.
The proposed higher rate is necessary to fully cover the
Committee's 2018-2019 fiscal period budgeted expenditures. The
Committee has had to draw from its monetary reserve to partially fund
program activities during the 2016-2017 and 2017-2018 fiscal periods.
Drawing from its financial reserve to fund operations on an on-going
basis is not a sustainable strategy. Increasing the continuing
assessment rate would allow the Committee to fully fund budgeted
expenses and replenish its financial reserve.
Prior to arriving at this budget and assessment rate, the Committee
considered maintaining the current assessment rate of $0.449 per
standard box or equivalent. However, leaving the assessment unchanged
would not generate sufficient revenue to meet the Committee's 2018-2019
fiscal period budgeted expenses of $9,213,133, and would have required
the Committee to continue to deplete its financial reserve. Based on
estimated shipments, the
[[Page 43801]]
recommended assessment rate of $0.463 per standard box or equivalent
should provide $9,260,000 in assessment income. The Committee
determined assessment revenue would be adequate to fully cover budgeted
expenditures for the 2018-2019 fiscal period, with any excess funds
used to replenish the Committee's monetary reserve. Reserve funds would
be kept within the amount authorized in the Order.
A review of historical information and preliminary information
pertaining to the upcoming fiscal year indicates that the average
grower price for the 2018-2019 season should be approximately $800 per
ton of fresh pears. Therefore, the estimated assessment revenue for the
2018-2019 fiscal period as a percentage of total grower revenue would
be about 2.6 percent.
This proposed action would increase the assessment obligation
imposed on handlers. While assessments impose some additional costs on
handlers, the costs are minimal and uniform on all handlers. Some of
the additional costs may be passed on to growers. However, these costs
would be offset by the benefits derived by the operation of the Order.
In addition, the Committee's meetings were widely publicized throughout
the Oregon and Washington fresh pear industry. All interested persons
were invited to attend the meetings and participate in Committee
deliberations on all issues. Like all Committee meetings, the May 31,
2018, 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 comments on this proposed rule, including
the regulatory and information collection impacts of this action on
small businesses.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the Order's information collection requirements have been
previously approved by the OMB and assigned OMB No. 0581-0189 Fruit
Crops. No changes in those requirements would be necessary because of
this action. Should any changes become necessary, they would be
submitted to OMB for approval.
This proposed rule would not impose any additional reporting or
recordkeeping requirements on either small or large Oregon and
Washington fresh pear 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.
AMS is committed to complying with the E-Government Act, to promote
the use of the internet and other information technologies to provide
increased opportunities for citizen access to Government information
and services, and for other purposes.
USDA has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this proposed 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/rules-regulations/moa/small-businesses. Any questions
about the compliance guide should be sent to Richard Lower at the
previously mentioned address in the FOR FURTHER INFORMATION CONTACT
section.
List of Subjects in 7 CFR Part 927
Marketing agreements, Pears, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 927 is
proposed to be amended as follows:
PART 927--PEARS GROWN IN OREGON AND WASHINGTON
0
1. The authority citation for 7 CFR part 927 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 927.236 paragraphs (a) and (b) are revised to read as
follows:
Sec. 927.236 Fresh pear assessment rate.
On and after July 1, 2018, the following base rates of assessment
for fresh pears are established for the Fresh Pear Committee:
(a) $0.463 per 44-pound net weight standard box or container
equivalent for any or all varieties or subvarieties of fresh pears
classified as ``summer/fall'';
(b) $0.463 per 44-pound net weight standard box or container
equivalent for any or all varieties or subvarieties of fresh pears
classified as ``winter''; and
* * * * *
Dated: August 22, 2018.
Bruce Summers,
Administrator, Agricultural Marketing Service.
[FR Doc. 2018-18552 Filed 8-27-18; 8:45 am]
BILLING CODE 3410-02-P