[Federal Register: November 1, 2007 (Volume 72, Number 211)]
[Proposed Rules]
[Page 61820-61821]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01no07-12]
========================================================================
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.
========================================================================
[[Page 61820]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 47
[Docket Number AMS-FV-06-0217; FV07-376]
RIN 0581-AC72
Amendments to Rules of Practice Regulations Under the Perishable
Agricultural Commodities Act (PACA) To Increase Reparation Complaint
Filing and Handling Fees
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: The Department of Agriculture (USDA) is proposing to amend the
Rules of Practice under the Perishable Agricultural Commodities Act
(PACA) (7 CFR part 47) to increase informal complaint filing fees and
formal complaint handling fees. The proposal would increase from $60 to
$100 the fee for filing an informal complaint; and would increase from
$300 to $500 the fee for handling a formal complaint.
DATES: Written or electronic comments received December 31, 2007 will
be considered prior to issuance of a final rule.
ADDRESSES: You may submit written or electronic comments to:
(1) PACA Complaint Fee Comments, AMS, F&V Programs, PACA Branch,
1400 Independence Avenue, SW., Room 2095-S, Washington, DC 20250-0242.
(2) Fax: 202-690-4413.
(3) E-mail comments to Dexter.Thomas@usda.gov.
(4) Internet: http://www.regulations.gov.
Instructions: All comments will become a matter of public record
and should be identified as ``PACA Complaint Fee Comments.'' Comments
will be available for public inspection from the Agricultural Marketing
Service at the above address or over the Agency's Web site at: http://www.ams.usda.gov/paca.
Web site questions can be addressed to the PACA Webmaster, Dexter.Thomas@usda.gov..
FOR FURTHER INFORMATION CONTACT: John Koller, Director, Dispute
Resolution Section, 202-720-1442.
SUPPLEMENTARY INFORMATION: This proposed rule is issued under authority
of section 15 of the PACA (7 U.S.C. 499o).
The Perishable Agricultural Commodities Act (PACA or Act)
establishes a code of fair trade practices covering the marketing of
fresh and frozen fruits and vegetables in interstate and foreign
commerce. The PACA protects growers, shippers, distributors, and
retailers dealing in those commodities by prohibiting unfair and
fraudulent trade practices. In this way, the law fosters an efficient
nationwide distribution system for fresh and frozen fruits and
vegetables, benefiting the whole marketing chain from farmer to
consumer. USDA's Agricultural Marketing Service (AMS) administers and
enforces the PACA.
The PACA program is financed by license and user fees and has an
annual operating budget of approximately $10 million. Currently, annual
expenses exceed revenue by $3 million, a disparity that is projected to
increase each year by another 3 to 5 percent. Greater than half of the
program's expenditures are payroll and related expenses, followed at a
distant second by the cost of maintaining office space through rent,
communications, and utility expenses. The PACA license and complaint
filing fees have remained unchanged since 1995, in part due to a one-
time Congressional appropriation of $30.45 million deposited into the
PACA reserve fund on October 1, 2000.
One of the most important functions of the Act is to require that
PACA licensees fulfill their contractual obligations, and the Act
provides a forum, before the Secretary, where firms that buy and sell
fruits and vegetables can settle commercial disputes outside of the
civil court system and recover damages for losses they have suffered.
These cases are called reparation cases. In 1995, Section 6 of the PACA
(7 U.S.C. 499f) was amended to require a $60 filing fee for filing an
informal reparation complaint and a $300 handling fee for filing a
formal reparation complaint with USDA under the PACA. Section 6 of the
PACA also authorized the Secretary of Agriculture to alter the filing
and handling fees by rulemaking. During its January 2007 meeting, the
Fruit and Vegetable Industry Advisory Committee (Committee) recommended
to the Secretary that the fee for filing an informal reparation
complaint be increased to $100, and the handling fee for filing a
formal reparation complaint be increased to $500. The Secretary
accepted the Committee's recommendation. This proposed rule would
implement the Committee's recommendation by increasing from $60 to $100
the fee for filing an informal reparation complaint; and increasing
from $300 to $500 the fee for handling a formal reparation complaint.
PACA Rules of Practice applicable to reparation complaint
proceedings inform the industry of USDA's procedures and requirements
for the handling of informal and formal complaints under the Act (7
CFR, Part 47). Section 47.3(a) of the current Rules of Practice (7 CFR
47.3(a)) requires that a $60 filing fee accompany any written
correspondence and related documents pertaining to the transaction(s)
involved in the dispute before AMS can process and open an informal
reparation complaint on behalf of the complainant.
When an informal reparation complaint is filed, AMS makes every
effort to assist the parties in reaching a settlement of their dispute
while gathering documents as part of its investigation. Mediation
services are also offered to the parties throughout the informal
handling of the complaint. If an informal settlement cannot be reached,
however, the complainant is given the opportunity to file a formal
reparation complaint. Section 47.6(c) of the current Rules of Practice
(7 CFR 47.6(c)) requires that a complainant filing a formal reparation
complaint pay a $300 handling fee to AMS to initiate formal complaint
proceedings. Under formal complaint procedures, USDA's Judicial Officer
issues a binding decision in the case.
In Fiscal Year 2007, there were 1,418 informal reparation
complaints and 325 formal reparation complaints filed with AMS under
the PACA. Over 91 percent of the informal complaints filed under the
Act were resolved informally within 4 months. These complaints involved
produce transactions valued at over
[[Page 61821]]
$17.5 million. USDA issued formal decision and orders in 322 cases
involving award amounts totaling approximately $5.6 million. The
largest award issued by USDA in Fiscal Year 2007 ordered payment of
over $257,000 to a fruit and vegetable dealer.
In Fiscal Year 2006, AMS received 1,559 informal reparation
complaints of which 92 percent were resolved informally within a 4-
month timeframe. In Fiscal Year 2006, informal settlements exceeded
$18.7 million. There were 300 formal reparation complaints filed under
the Act that year.
AMS does not expect this proposal to raise a significant amount of
revenue for the PACA program (estimated at $144,000 annually), but by
increasing the fees for filing informal and formal reparation
complaints, AMS believes that the burden for financing the PACA program
is shifted more towards those who benefit directly from using PACA
program services.
Executive Orders 12866 and 12988
This proposed rule has been determined to be not significant for
the purposes of Executive Order 12866, and therefore, has not been
reviewed by the Office of Management and Budget.
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform, and is not intended to have retroactive effect.
This proposed rule will not preempt any State or local laws,
regulations, or policies, unless they present an irreconcilable
conflict with this rule. There are no administrative procedures that
must be exhausted prior to any judicial challenge to the provisions of
this proposed rule.
Effects on Small Businesses
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601, et seq.), USDA has considered the economic
impact of this proposed rule on small entities. 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. Small agricultural service firms have been
defined by the Small Business Administration (13 CFR part 121) as those
with less than 500 employees. The PACA requires all businesses that
operate subject to its provisions to maintain a license issued by USDA.
There are approximately 14,500 PACA licensees, a majority of which may
be classified as small entities.
Over the past 4 years, the number of informal and formal reparation
complaints filed with AMS under the PACA has gradually decreased. AMS
believes that this decrease is due in part to enhanced PACA customer
service focused on educating members of the produce industry of their
rights and responsibilities under the PACA, as well as increased
efforts to settle informal reparation complaints through mediation.
It is doubtful that any barrier to the use of USDA's PACA
reparation procedure would be created by raising the filing and
handling fees for informal and formal reparation complaints. Most
complaints involve produce transactions valued in the thousands of
dollars, making the proposed increase from $60 to $100 for filing an
informal reparation complaint insignificant by comparison. In addition,
the handling fee for filing a formal reparation complaint is
recoverable as part of the amount awarded by USDA if the complainant
prevails in the case. AMS believes that those who wish to initiate
formal proceedings in a reparation case would consider the proposed
increase in the formal reparation complaint handling fee from $300 to
$500 to be insignificant as well.
Given the preceding discussion, AMS has determined that the
provisions of the proposed rule would not have a significant impact on
a substantial number of small entities.
Paperwork Reduction Act
In accordance with OMB regulations (5 CFR Part 1320) that implement
the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the
information collection and record keeping requirements that are covered
by this proposed rule were approved under OMB number 0581-0031 on
October 5, 2004, and expire on October 31, 2007.
E-Government Act Compliance
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.
List of Subjects in 7 CFR Part 47
Administrative practice and procedure, Agricultural commodities,
Brokers.
For the reasons set forth in the preamble, AMS proposes to amend 7
CFR part 47 as follows:
PART 47--[AMENDED]
1. The authority citation for part 47 is revised to read as
follows:
Authority: 7 U.S.C. 499f; 5 U.S.C 553; 7 CFR
2.22(a)(1)(viii)(L), 2.79(a)(8)(xiii).
2. In Sec. 47.3, paragraph (a)(4) is revised as follows:
Sec. 47.3 Institution of proceedings.
(a) * * *
(1) * * *
(2) * * *
(3) * * *
(4) The informal complaint shall be accompanied by a filing fee of
$100 as authorized by the Act.
* * * * *
3. In Sec. 47.6, paragraph (c) is revised as follows:
Sec. 47.6 Formal complaints.
* * * * *
(c) Service upon respondent; proof of service. Upon receipt by the
Fruit and Vegetable Programs of the formal complaint, the accompanying
papers and the $500 handling fee authorized by the Act, a copy thereof
shall be served by the Fruit and Vegetable Programs upon the respondent
in accordance with Sec. 47.4 of this Part. If the complaint is not in
the proper form, the Fruit and Vegetable Programs shall return it and
inform the complainant of the deficiencies therein.
* * * * *
Dated: October 26, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E7-21477 Filed 10-31-07; 8:45 am]
BILLING CODE 3410-02-P