[Federal Register Volume 64, Number 51 (Wednesday, March 17, 1999)]
[Proposed Rules]
[Pages 13123-13125]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-6490]
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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. 64, No. 51 / Wednesday, March 17, 1999 /
Proposed Rules
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 915
[Docket No. FV99-915-1 PR]
Avocados Grown in South Florida; Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would increase the assessment rate from
$0.08 to $0.16 per 55-pound bushel container or equivalent of avocados
established for the Avocado Administrative Committee (Committee) under
Marketing Order No. 915 for the 1999-2000 and subsequent fiscal years.
The Committee is responsible for local administration of the marketing
order which regulates the handling of avocados grown in South Florida.
Authorization to assess avocado handlers enables the Committee to incur
expenses that are reasonable and necessary to administer the program.
The fiscal year begins April 1 and ends March 31. The assessment rate
would remain in effect indefinitely unless modified, suspended, or
terminated.
DATES: Comments must be received by April 16, 1999.
ADDRESSES: Interested persons are invited to submit written comments
concerning this rule. Comments must be sent to the Docket Clerk, Fruit
and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456,
Washington, DC 20090-6456; Fax: (202) 720-5698; or E-mail:
[email protected]. 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.
FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Southeast Marketing
Field Office, Fruit and Vegetable Programs, AMS, USDA, P.O. Box 2276;
Winter Haven, FL 33883-2276; telephone: (941) 299-4770, Fax: (941) 299-
5169; or George Kelhart, Technical Advisor, Marketing Order
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, room
2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: (202)
720-2491, Fax: (202) 720-5698. Small businesses may request information
on complying with this regulation, or obtain a guide on complying with
fruit, vegetable, and specialty crop marketing agreements and orders by
contacting Jay Guerber, Marketing Order Administration Branch, Fruit
and Vegetable Programs, AMS, USDA, P.O. Box 96456, room 2525-S,
Washington, DC 20090-6456; telephone (202) 720-2491, Fax: (202) 720-
5698, or E-mail: Jay__N__G[email protected]. You may view the marketing
agreement and order small business compliance guide at the following
web site:
http://www.ams.usda.gov/fv/moab.html.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement No. 121 and Order No. 915, both as amended (7 CFR part 915),
regulating the handling of avocados grown in South Florida, 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 (Department) 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, Florida
avocado handlers are subject to assessments. Funds to administer the
order are derived from such assessments. It is intended that the
assessment rate as issued herein will be applicable to all assessable
avocados beginning on April 1, 1999, 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 the Secretary 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 the Secretary 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 the
Secretary'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 1999-2000 and subsequent fiscal years from $0.08 per
55-pound bushel container or equivalent to $0.16 per 55-pound bushel
container or equivalent of South Florida avocados handled.
The Florida avocado marketing order provides authority for the
Committee, with the approval of the Department, to formulate an annual
budget of expenses and collect assessments from handlers to administer
the program. The members of the Committee are producers and handlers of
South Florida avocados. 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 in a public
meeting. Thus, all directly affected persons have an opportunity to
participate and provide input.
For the 1998-99 and subsequent fiscal years, the Committee
recommended, and the Department approved, an assessment rate that would
continue in effect from fiscal year to fiscal year unless modified,
suspended, or terminated by the Secretary upon recommendation and
information submitted by the Committee or other information available
to the Secretary.
The Committee met on January 13, 1999, and unanimously recommended
1999-2000 expenditures of $167,335 and an assessment rate of $0.16 per
55-pound bushel container or equivalent of avocados handled. In
comparison, last year's budgeted expenditures were $174,344. The
assessment rate of $0.16 is $0.08 higher than the rate currently in
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effect. For the 1998-99 fiscal period, the Committee voted to lower its
assessment rate from $0.16 to $0.08 to reduce the funds in its
operating reserve. It wanted to bring its reserve closer to one year's
operating expenses. With this accomplished, the Committee voted to
return the assessment rate to the previous level of $0.16 to cover
1999-2000 expenses. As discussed later, the Committee expects to use
interest income and reserve funds to cover its anticipated expenses
during 1999-2000 because the $0.16 per 55-pound bushel container or
equivalent assessment rate is expected to generate $144,000, which is
$23,335 less than the Committee's budgeted expenses.
The major expenditures recommended by the Committee for the 1999-
2000 year include $46,000 for salaries, $39,500 for production
research, $27,000 for local and national enforcement, $10,040 for
employee benefits, $8,955 for insurance and bonds, and $5,500 for
travel. Budgeted expenses for these items in 1998-99 were $46,000,
$41,500, $32,000, $9,778, $8,516, and $7,000, respectively.
The assessment rate recommended by the Committee was derived by
dividing anticipated expenses by expected shipments of Florida
avocados. Avocado shipments for the year are estimated at 900,000 55-
pound bushel containers which should provide $144,000 in assessment
income. Income derived from handler assessments, along with interest
income and funds from the Committee's authorized reserve, would be
adequate to cover budgeted expenses. Funds in the reserve (currently
$187,615) would be kept within the maximum of 3 fiscal years'
operational expenses permitted by the order (Secs. 915.42 and 915.142).
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
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 the
Department. Committee meetings are open to the public and interested
persons may express their views at these meetings. The Department 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
1999-2000 budget and those for subsequent fiscal years would be
reviewed and, as appropriate, approved by the Department.
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 149 producers of avocados in the production
area and approximately 48 handlers subject to regulation under the
marketing order. Small agricultural producers have been defined by the
Small Business Administration (13 CFR 121.601) as those having annual
receipts less than $500,000, and small agricultural service firms are
defined as those whose annual receipts are less than $5,000,000.
The average price for fresh avocados during the 1996-97 season was
$13.20 per 55-pound bushel box equivalent for all domestic shipments
and the total shipments were 917,861 bushels. Approximately 10 percent
of all handlers handled 90 percent of the South Florida avocado
shipments during that season. Many handlers ship other tropical fruit
and vegetable products which are not included in the Committee data but
would contribute further to handler receipts. Using the average price
per 55-pound container or equivalent, about 90 percent of the avocado
handlers could be considered small businesses under SBA's definition
and about 10 percent of the handlers could be considered large
businesses. The majority of handlers and producers of Florida avocados
may be classified as small entities.
This rule would increase the assessment rate established for the
Committee and collected from handlers for the 1999-2000 and subsequent
fiscal years from $0.08 per 55-pound bushel container or equivalent to
$0.16 per 55-pound bushel container or equivalent of avocados. The
Committee unanimously recommended 1999-2000 expenditures of $167,335
and an assessment rate of $0.16 per 55-pound bushel container or
equivalent handled. The proposed assessment rate of $0.16 is $0.08
higher than the 1998-99 rate. The quantity of assessable avocados for
the 1999-2000 season is estimated at 900,000 containers. Thus, the
$0.16 rate should provide $144,000 in assessment income. Assessment
income, along with interest income and funds from the Committee's
authorized reserve, would be adequate to cover budgeted expenses.
The major expenditures recommended by the Committee for the 1999-
2000 year include $46,000 for salaries, $39,500 for production
research, $27,000 for local and national enforcement, $10,040 for
employee benefits, $8,955 for insurance and bonds, and $5,500 for
travel. Budgeted expenses for these items in 1998-99 were $46,000,
$41,500, $32,000, $9,778, $8,516, and $7,000, respectively.
During the 1998-99 season, the Committee voted to decrease the
assessment rate to bring its operating reserve closer to one year's
operating expenses. For the 1999-2000 fiscal period, the Committee
voted to return to the previous rate of $0.16 to cover authorized
expenses. The Committee expects to use interest income and funds from
its operating reserve to cover 1999-2000 expenses. This would be
necessary because assessment income is expected to total $144,000, and
the Committee's budget totals $167,335.
The Committee's 1999-2000 budgeted expenditures of $167,335 include
increases in employee benefits and office equipment. Prior to arriving
at this budget, the Committee considered information from various
sources, such as the Committee's Budget Subcommittee. Alternative
expenditure levels were discussed, based upon the relative value of
various research projects to the South Florida avocado industry.
The assessment rate of $0.16 per 55-pound bushel container or
equivalent of assessable avocados was then determined by dividing the
total recommended budget by the quantity of assessable avocados,
estimated at 900,000 55-pound bushel containers or equivalents for the
1999-2000 fiscal period. This rate is expected to provide $144,000 in
assessment income, which is $23,335 below budgeted expenses. The
Committee found this acceptable because interest income and funds from
the Committee's operating reserve would be available to make up the
deficit.
A review of historical information indicates that the grower price
for the 1999-2000 season could range between
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$13.20 and $14.90 per 55-pound bushel container or equivalent of
avocados. Therefore, the estimated assessment revenue for the 1999-2000
fiscal year as a percentage of total grower revenue could range between
1 and 1.2 percent.
This 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 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 Florida avocado industry and all interested
persons were invited to attend the meeting and participate in Committee
deliberations on all issues. Like all Committee meetings, the January
13, 1999, 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 Florida avocado
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.
The Department has not identified any relevant Federal rules that
duplicate, overlap, or conflict with this rule.
A 30-day comment period is provided to allow interested persons to
respond to this proposed rule. Thirty days is deemed appropriate
because: (1) The 1999-2000 fiscal year begins on April 1, 1999, and the
marketing order requires that the rate of assessment for each fiscal
year apply to all assessable avocados handled during such fiscal 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 915
Avocados, Marketing agreements, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 915 is
proposed to be amended as follows:
PART 915--AVOCADOS GROWN IN SOUTH FLORIDA
1. The authority citation for 7 CFR part 915 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. Section 915.233 is revised to read as follows:
Sec. 915.233 Assessment rate.
On and after April 1, 1999, an assessment rate of $0.16 per 55-
pound bushel container or equivalent is established for avocados grown
in South Florida.
Dated: March 11, 1999.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 99-6490 Filed 3-16-99; 8:45 am]
BILLING CODE 3410-02-P