[Federal Register: October 20, 2008 (Volume 73, Number 203)]
[Proposed Rules]
[Page 62218-62220]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20oc08-15]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 966
[Docket No. AMS-FV-08-0081; FV08-966-1 PR]
Tomatoes Grown In Florida; 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 Florida Tomato Committee (Committee) for the 2008-09 and subsequent
fiscal periods from $0.0325 to $0.0375 per 25-pound carton of tomatoes
handled. The Committee locally administers the marketing order which
regulates the handling of tomatoes grown in Florida. Assessments upon
tomato handlers are used by the Committee to fund reasonable and
necessary expenses of the program. The fiscal period begins August 1
and ends July 31. The assessment rate would remain in effect
indefinitely unless modified, suspended, or terminated.
DATES: Comments must be received by November 19, 2008.
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: William G. Pimental, Marketing
Specialist, or Christian D. Nissen, Regional Manager, Southeast
Marketing Field Office, Marketing Order Administration Branch, Fruit
and Vegetable Programs, AMS, USDA; Telephone: (863) 324-3375 Fax: (863)
325-8793, or E-mail: William.Pimental@usda.gov or
Christian.Nissen@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
Agreement No. 125 and Order No. 966, both as amended (7 CFR part 966),
regulating the handling of tomatoes grown in Florida, 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, Florida tomato
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 would be applicable to all assessable tomatoes
beginning on August 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 would increase the assessment rate established for the
Committee for the 2008-09 and subsequent fiscal periods from $0.0325 to
$0.0375 per 25-pound carton of tomatoes.
The Florida tomato 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 of Florida
tomatoes. 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 fiscal periods, the Committee
recommended, and USDA approved, an assessment rate that would continue
in effect from fiscal period to fiscal period unless modified,
suspended, or terminated by USDA upon recommendation and information
submitted by the Committee or other information available to USDA.
[[Page 62219]]
The Committee met on August 14, 2008, and unanimously recommended
2008-09 expenditures of $2,438,200 and an assessment rate of $0.0375
per 25-pound carton of tomatoes. In comparison, last year's budgeted
expenditures were $2,101,000. The assessment rate of $0.0375 is $0.005
higher than the rate currently in effect. The assessment increase is
needed to offset the 2008-09 increase in education and promotion
expenses, salaries, and employee retirement. Without the increase in
the assessment rate, the Committee would need to utilize an additional
$250,000 from the authorized reserve. Therefore, the Committee voted to
increase the assessment rate.
The major expenditures recommended by the Committee for the 2008-09
year include $1,200,000 for education and promotion, $505,500 for
salaries, $320,000 for research, and $77,000 for employee retirement.
Budgeted expenses for these items in 2007-08 were $900,000, $467,000,
$320,000, and $71,000, respectively.
The assessment rate recommended by the Committee was derived by
dividing anticipated expenses, less anticipated funds from the USDA
Market Access Program (MAP), by expected shipments of Florida tomatoes.
Tomato shipments for the year are estimated at 50 million 25-pound
cartons and should provide $1,875,000 in assessment income. Income
derived from handler assessments, along with interest income, MAP
funds, and funds from the Committee's authorized reserve, would be
adequate to cover budgeted expenses. Funds in the reserve (currently
approximately $593,000) would be kept within the maximum permitted by
the order of not to exceed one fiscal period's expenses as stated in
Sec. 966.44 of the order.
The proposed assessment rate 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 2008-09 budget and those
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), 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 100 producers of tomatoes in the production
area and approximately 70 handlers subject to regulation under the
marketing 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 $6,500,000 (13 CFR 121.201).
Based on industry and Committee data, the average annual price for
fresh Florida tomatoes during the 2007-08 season was approximately
$13.71 per 25-pound container, and total fresh shipments for the 2007-
08 season were 45,177,457 25-pound cartons of tomatoes. Committee data
indicates that approximately 25 percent of the handlers handle 94
percent of the total volume shipped outside the regulated area. Based
on the average price, about 75 percent of handlers could be considered
small businesses under SBA's definition. In addition, based on
production data, grower prices as reported by the National Agricultural
Statistics Service, and the total number of Florida tomato growers, the
average annual grower revenue is below $750,000. Thus, the majority of
handlers and producers of Florida tomatoes may be classified as small
entities.
This rule would increase the assessment rate established for the
Committee and collected from handlers for the 2008-09 and subsequent
fiscal periods from $0.0325 to $0.0375 per 25-pound carton of tomatoes.
The Committee unanimously recommended 2008-09 expenditures of
$2,438,200 and an assessment rate of $0.0375 per 25-pound carton. The
proposed assessment rate of $0.0375 is $0.005 higher than the 2007-08
rate. The quantity of assessable tomatoes for the 2008-09 season is
estimated at 50 million 25-pound cartons. Thus, the $0.0375 rate should
provide $1,875,000 in assessments. Income derived from handler
assessments, along with interest income and funds from the Committee's
authorized reserve, and other income, would be adequate to cover
budgeted expenses.
The major expenditures recommended by the Committee for the 2008-09
year include $1,200,000 for education and promotion, $505,500 for
salaries, $320,000 for research, and $77,000 for employee retirement.
Budgeted expenses for these items in 2007-08 were $900,000, $467,000,
$320,000, and $71,000, respectively.
The assessment increase is needed to offset the 2008-09 increase in
education and promotion expenses, salaries, and employee retirement.
Without the increase in the assessment rate, the Committee would need
to utilize an additional $250,000 from the authorized reserve.
Therefore, the Committee voted to increase the assessment rate.
The Committee reviewed and unanimously recommended 2008-09
expenditures of $2,438,200, which included increases in education and
promotion, salaries, and employee retirement. Prior to arriving at this
budget, the Committee considered information from various sources, such
as the Committee's Executive Subcommittee, Finance Subcommittee,
Research Subcommittee, and Education and Promotion Subcommittee.
Alternative expenditure levels were discussed by these groups based
upon the relative value of various education and promotion projects to
the tomato industry. The assessment rate of $0.0375 per 25-pound
container of assessable tomatoes was determined by examining the
anticipated expenses, expected shipments, MAP funds, and available
reserves. The recommended assessment rate would generate $1,875,000 in
income. Considering income from assessments, interest, and other
sources, total income would be approximately $27,000 below the
anticipated expenses, which the Committee determined to be acceptable.
A review of historical information and preliminary information
pertaining to the 2008-09 fiscal period indicates that the grower price
for the 2008-09 season could range between $7.98 and $12.95 per 25-
pound carton of tomatoes. Therefore, the estimated assessment
[[Page 62220]]
revenue for the 2008-09 season as a percentage of total grower revenue
could range between 0.3 and 0.5 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 tomato industry and all interested
persons were invited to attend the meeting and participate in Committee
deliberations on all issues. Like all Committee meetings, the August
14, 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 proposed rule, including
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 tomato
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=MarketingOrdersSmallBus
inessGuide. Any questions about the compliance guide should be sent to
Jay Guerber at the previously mentioned address in the FOR FURTHER
INFORMATION CONTACT section.
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 2008-09 fiscal period began on August 1, 2008, and the
marketing order requires that the rate of assessment for each fiscal
period apply to all assessable tomatoes handled during such fiscal
period; (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 966
Marketing agreements, Reporting and recordkeeping requirements,
Tomatoes.
For the reasons set forth in the preamble, 7 CFR part 966 is
proposed to be amended as follows:
PART 966--TOMATOES GROWN IN FLORIDA
1. The authority citation for 7 CFR part 966 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. Section 966.234 is revised to read as follows:
Sec. 966.234 Assessment rate.
On and after August 1, 2008, an assessment rate of $0.0375 per 25-
pound carton is established for Florida tomatoes.
Dated: October 15, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E8-24919 Filed 10-17-08; 8:45 am]
BILLING CODE 3410-02-P