[Federal Register: August 26, 2008 (Volume 73, Number 166)]
[
Rules and Regulations]
[Page 50188-50191]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26au08-3]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 987
[Docket No. AMS-FV-08-0056; FV08-987-1 IFR]
Domestic Dates Produced or Packed in Riverside County, CA;
Decreased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
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[[Page 50189]]
SUMMARY: This rule decreases the assessment rate established for the
California Date Administrative Committee (Committee) for the 2008-09
and subsequent crop years from $0.75 to $0.60 per hundredweight of
dates handled. The Committee locally administers the marketing order
which regulates the handling of dates grown or packed in Riverside
County, California. Assessments upon date handlers are used by the
Committee to fund reasonable and necessary expenses of the program. The
crop year begins October 1 and ends September 30. The assessment rate
will remain in effect indefinitely unless modified, suspended, or
terminated.
DATES: Effective August 27, 2008. Comments received by October 27,
2008, will be considered prior to issuance of a final rule.
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 Internet: http://
www.regulations.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.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Terry Vawter, Senior Marketing
Specialist, or Kurt J. Kimmel, Regional Manager, California Marketing
Field Office, Marketing Order Administration Branch, Fruit and
Vegetable Programs, AMS, USDA; Telephone: (559) 487-5901, Fax: (559)
487-5906, or E-mail: Terry.Vawter@usda.gov or Kurt.Kimmel@usda.gov.
Small businesses may request information on complying 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 Order
No. 987, as amended (7 CFR part 987), regulating the handling of dates
grown or packed in Riverside County, California, hereinafter referred
to as the ``order.'' 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 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 issued herein will be applicable to all assessable dates
beginning October 1, 2008, 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 decreases the assessment rate established for the
Committee for the 2008-09 and subsequent crop years from $0.75 per to
$0.60 per hundredweight of dates.
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 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 in a public meeting. Thus,
all directly affected persons have an opportunity to participate and
provide input.
For the 2007-08 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 May 29, 2008, and unanimously recommended
2008-09 expenditures of $176,384 and an assessment rate of $0.60 per
hundredweight of California dates. In comparison, last year's budgeted
expenditures were $209,182. The assessment rate of $0.60 is $0.15 lower
than the rate currently in effect. The Committee recommended a lower
assessment rate because the 2007 crop was larger than expected,
resulting in excess assessment income and thus a larger reserve. Income
generated through the lower assessment rate combined with reserve funds
should be sufficient to cover anticipated 2008-09 expenses.
Section 987.72(c) states that the reserve may not exceed 50 percent
of the average of expenses incurred during the most recent five
preceding crop years. With the larger 2007 crop, the reserve at the end
of the 2007-08 crop year is projected to exceed this limit. Excess
assessment funds will be refunded to handlers to reduce the reserve and
bring it in line with order requirements.
Proceeds from sales of cull dates are 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. Pursuant to
Sec. 987.72(b), the Committee is authorized to temporarily use funds
derived from assessments to defray expenses incurred in disposing of
surplus dates. All such expenses are required to be deducted from
proceeds obtained by the Committee from the disposal of surplus dates.
For the 2008-09 crop year, the Committee estimated that $4,500 from the
surplus account would be needed to temporarily defray expenses incurred
in disposing of surplus dates.
The major expenditures recommended by the Committee for the 2008-09
crop year include $66,384 for general and administrative programs,
$82,000 for promotional programs, and $28,000 for marketing and media
consulting. The Committee also budgeted $10,000 as a contingency
reserve for other marketing and promotion projects that it may wish to
[[Page 50190]]
support later in the year. By comparison, expenditures recommended by
the Committee for the 2007-08 crop year include $87,312 for general and
administrative programs, $67,870 for promotional programs, $24,000 for
marketing and media consulting, $5,000 for moving expenses, and $5,000
for updating marketing materials. The Committee budgeted $20,000 as a
contingency reserve for other marketing and promotion projects.
The assessment rate of $0.60 per hundredweight of assessable dates
was derived by applying the following formula where:
A= 2007-08 estimated reserve on 09/30/08 ($134,757);
B= 2008-09 estimated reserve on 10/01/09 ($78,996);
C= 2008-09 expenses ($176,384);
D= Cull Surplus Fund ($4,500);
E= Assessment Refund ($15,877); and
F= 2008-09 expected shipments (22,000,000 pounds).
[(B-A+C-D+E)/F] *100.
The assessment rate established in this rule will 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 is effective for an indefinite
period, the Committee will 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 will evaluate Committee
recommendations and other available information to determine whether
modification of the assessment rate is needed. Further rulemaking will
be undertaken as necessary. The Committee's 2008-09 budget and those
for subsequent crop years will be reviewed and, as appropriate,
approved by 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.
There are approximately 85 producers of dates in the production
area and 9 handlers subject to regulation under the marketing order.
The Small Business Administration (13 CFR 121.201) defines small
agricultural producers as those having annual receipts of less than
$750,000, and small agricultural service firms are defined as those
having annual receipts of less than $6,500,000.
According to the National Agricultural Statistics Service (NASS),
data for the most recently completed crop year (2006) shows that about
3.12 tons, or 6,240 pounds, of dates were produced per acre. The 2006
grower price published by the NASS was $1,320 per ton, or $.66 per
pound. Thus, the value of date production per acre in 2006 averaged
about $4,118 (6,240 pounds times $.66 per pound). At that average
price, a producer would have to farm over 182 acres to receive an
annual income from dates of $750,000 ($750,000 divided by $4,118 per
acre equals 182 acres). According to Committee staff, the majority of
California date producers farm less than 182 acres. Thus, it can be
concluded that the majority of date producers could be considered small
entities. The majority of handlers of California dates may also be
considered small entities.
This rule decreases the assessment rate established for the
Committee and collected from handlers for the 2008-09 and subsequent
crop years from $0.75 to $0.60 per hundredweight of dates handled. The
Committee unanimously recommended 2008-09 expenditures of $176,384 and
an assessment rate of $0.60 per hundredweight of dates, which is $0.15
lower than the 2007-08 rate, currently in effect. The quantity of
assessable dates for the 2008-09 crop year is estimated at 22,000,000
pounds. Thus, the $0.60 rate should provide $132,000 in assessment
income and, with reserve funds of $39,884 and the $4,500 contribution
from the surplus program, will be adequate to meet the 2008-09 crop
year expenses.
The major expenditures recommended by the Committee for the 2008-09
crop year include $66,384 for general and administrative programs,
$82,000 for promotional programs, and $28,000 for marketing and media
consulting. The Committee also budgeted $10,000 as a contingency
reserve for other marketing and promotion projects that it may wish to
support later in the year.
The Committee recommended a lower assessment rate because the 2007
crop was larger than expected, resulting in excess assessment income
and thus a larger reserve. Income generated through the lower
assessment rate combined with reserve funds should be sufficient to
cover anticipated 2008-09 expenses.
The Committee reviewed and unanimously recommended 2008-09 crop
year expenditures of $176,384. Prior to arriving at this budget, the
Committee considered information from various sources, such as the
Committee's Marketing Subcommittee. Alternative expenditure levels were
an option available to the Committee, but given the extra assessment
income generated from the larger-than-expected 2007-08 crop, it was
ultimately determined that a $176,384 budget would be appropriate. The
assessment rate of $0.60 per hundredweight of dates was then derived,
based upon the Committee's estimates of the incoming reserve, income,
and anticipated expenses.
According to the NASS, the season average grower price for 2007
crop dates is projected at $1,800 per ton, or $90 per hundredweight. No
official NASS estimate is available yet for 2008. The average grower
price for 2005-07 is $1,517 per ton, or $76 per hundredweight.
To calculate the percentage of grower revenue represented by the
assessment rate for 2007, the assessment rate of $0.75 (per
hundredweight) is divided by the estimated average grower price. This
results in estimated assessment revenue for the 2007-08 crop year as a
percentage of grower revenue of .83 percent ($0.75 divided by $90 per
hundredweight). As previously mentioned, NASS data for 2008 is not yet
available. However, applying the same calculations above using the
average grower price for 2005-07 would result in estimated assessment
revenue as a percentage total grower revenue of .79 percent for the
2008-09 crop year ($0.60 divided by $76 per hundredweight). Thus, the
assessment revenue should be well below 1 percent of estimated grower
revenue in 2008.
This action decreases the assessment obligation imposed on
handlers. Assessments are applied uniformly on all handlers, and some
of the costs may be passed on to producers. However, decreasing the
assessment rate reduces the burden on handlers, and may reduce the
burden on producers. 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
[[Page 50191]]
participate in Committee deliberations on all issues. Like all
Committee meetings, the May 29, 2008, 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 interim final rule, including the regulatory and informational
impacts of this action on small businesses.
This action imposes 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.
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 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/ AMSv1.0/ ams.fetchTemplateData.do?
template=TemplateN&page= MarketingOrdersSmallBusinessGuide. Any
questions about the compliance guide should be sent to Jay Guerber at
the previously mentioned address in the FOR FURTHER INFORMATION CONTACT
section.
After consideration of all relevant material presented, including
the information and recommendation submitted by the Committee and other
available information, it is hereby found that this rule, as
hereinafter set forth, will tend to effectuate the declared policy of
the Act.
Pursuant to 5 U.S.C. 553, it is also found and determined upon good
cause that it is impracticable, unnecessary, and contrary to the public
interest to give preliminary notice prior to putting this rule into
effect, and that good cause exists for not postponing the effective
date of this rule until 30 days after publication in the Federal
Register because: (1) The 2008-09 crop year begins on October 1, 2008,
and the marketing order requires that the rate of assessment for each
crop year applies to all assessable dates handled during such crop
year; (2) the action decreases the assessment rate for assessable dates
beginning with the 2008-09 crop year; (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; and (4) this interim final rule provides a 60-day comment
period, and all comments timely received will be considered prior to
finalization of this rule.
List of Subjects in 7 CFR Part 987
Dates, Marketing agreements, Reporting and recordkeeping
requirements.
0
For the reasons set forth in the preamble, 7 CFR part 987 is amended as
follows:
PART 987--DATES PRODUCED OR PACKED IN RIVERSIDE COUNTY, CALIFORNIA
0
1. The authority citation for 7 CFR part 987 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 987.339 is revised to read as follows:
Sec. 987.339 Assessment rate.
On and after October 1, 2008, an assessment rate of $0.60 per
hundredweight is established for California dates.
Dated: August 20, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E8-19697 Filed 8-25-08; 8:45 am]
BILLING CODE 3410-02-P