[Federal Register Volume 75, Number 64 (Monday, April 5, 2010)]
[Proposed Rules]
[Pages 17072-17075]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-7568]
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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. 75, No. 64 / Monday, April 5, 2010 / Proposed
Rules
[[Page 17072]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Parts 916 and 917
[Doc. No. AMS-FV-09-0091; FV10-916/917-2 PR]
Nectarines and Peaches Grown in California; Increased Assessment
Rates
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This rule would increase the assessment rates established for
the Nectarine Administrative Committee and the Peach Commodity
Committee (Committees) for the 2009-10 and subsequent fiscal periods
from $0.0175 to $0.0280 per 25-pound container or container equivalent
of nectarines handled, and from $0.0025 to $0.026 per 25-pound
container or container equivalent of peaches handled. The Committees
locally administer the marketing orders which regulate the handling of
nectarines and peaches grown in California. Assessments upon nectarine
and peach handlers are used by the Committees to fund reasonable and
necessary expenses of the programs. The fiscal periods run from March 1
through the last day of February. The assessment rates would remain in
effect indefinitely unless modified, suspended, or terminated.
DATES: Comments must be received by May 5, 2010.
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 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: Jerry L. Simmons, Marketing
Specialist, or Kurt 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: [email protected] or
[email protected].
Small businesses may request information on complying with this
regulation by contacting Antoinette Carter, 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:
[email protected].
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order
Nos. 916 and 917, both as amended (7 CFR parts 916 and 917), regulating
the handling of nectarines and peaches grown in California,
respectively, hereinafter referred to as the ``orders.'' The orders 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 (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 orders now in effect, California
nectarine and peach handlers are subject to assessments. Funds to
administer the orders are derived from such assessments. It is intended
that the assessment rates as proposed herein would be applicable to all
assessable nectarines and peaches beginning on March 1, 2010, 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.
This rule would increase the assessment rates established for the
Nectarine Administrative Committee (NAC) for the 2010-11 and subsequent
fiscal periods from $0.0175 to $0.0280 per 25-pound container or
container equivalent of nectarines and for the Peach Commodity
Committee (PCC) for the 2010-11 and subsequent fiscal periods from
$0.0025 to $0.026 per 25-pound container or container equivalent of
peaches.
The nectarine and peach marketing orders provide authority for the
Committees, with the approval of USDA, to formulate annual budgets of
expenses and collect assessments from handlers to administer the
programs. The members of NAC and PCC are producers of California
nectarines and peaches, respectively. They are familiar with the
Committees' needs, and with the costs for goods and services in their
local area and are, therefore, in a position to formulate appropriate
budgets and assessment rates. The assessment rates are formulated and
discussed in public meetings. Thus, all directly affected persons have
an opportunity to participate and provide input.
NAC Assessment and Expenses
For the 2009-10 and subsequent fiscal periods, the NAC 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 17073]]
The NAC met on December 10, 2009, and unanimously recommended 2010-
11 expenditures of $1,448,101 and an assessment rate of $0.0280 per 25-
pound container or container equivalent of nectarines. In comparison,
the budgeted expenditures for the 2009-10 fiscal period were
$1,797,290. The assessment rate of $0.0280 per 25-pound container or
container equivalent of nectarines is $0.0105 higher than the rate
currently in effect. The NAC recommended a higher assessment rate
because the 2009 crop was lower than expected due to a large number of
tree pullouts and other economic factors.
The major expenditures recommended by the NAC for the 2010-11
fiscal period include $291,377 for administration, $157,016 for
production research, and $999,708 for domestic and international
programs. In comparison, budgeted expenses for these items in 2008-09
were $319,965.32 for administration, $349,447.55 for production
research, and $1,127,877.33 for domestic and international programs.
The assessment rate recommended by the NAC was derived after
considering anticipated fiscal year expenses; estimated assessable
nectarines of 16,200,000 25-pound containers or container equivalents;
the estimated income from other sources, such as interest; and the need
for an adequate financial reserve to carry the NAC into the 2011-12
fiscal period. Therefore, the NAC recommended an assessment rate of
$0.0280 per 25-pound container or container equivalent.
Combining expected assessment revenue of $453,600 with the $641,840
carryover available from the 2009-10 fiscal period and other income
such as interest should be adequate to meet Committee needs. The
assessment rate is also likely to provide a $116,486 reserve, which may
be used to cover administrative expenses prior to the beginning of the
2011-12 shipping season as provided in the order (Sec. 916.42).
PCC Assessment and Expenses
For the 2009-10 and subsequent fiscal periods, the PCC 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.
The PCC met on December 10, 2009, and recommended 2010-11
expenditures of $1,839,651 and an assessment rate of $0.026 per 25-
pound container or container equivalent of peaches. In comparison,
budgeted expenditures for the 2009-10 fiscal period were $1,885,250.
The assessment rate of $0.026 per 25-pound container or container
equivalent of peaches is $0.0235 higher than the rate currently in
effect. The PCC recommended a higher assessment rate because the 2009
crop was lower than expected due to a large number of tree pullouts and
other economic factors.
The major expenditures recommended by the PCC for the 2010-11
fiscal period include $368,756 for administration, $199,662 for
production research, and $1,271,233 for domestic and international
programs. In comparison, budgeted expenses for these items in 2009-10
were $334,058 for administration, $366,920 for production research, and
$1,184,272 for domestic and international programs.
The assessment rate recommended by the PCC was derived after
considering anticipated fiscal year expenses; estimated assessable
peaches of 20,600,000 25-pound containers or container equivalents; the
estimated income from other sources, such as interest; and the need for
an adequate financial reserve to carry the PCC into the 2011-12 fiscal
period. Therefore, the PCC recommended an assessment rate of $0.026 per
25-pound container or container equivalent.
Combining expected assessment revenues of $535,600 with the
$854,699 carryover available from the 2009-10 fiscal period and other
income such as interest should be adequate to meet Committee needs. The
assessment rate is also likely to provide a $147,502 reserve, which may
be used to cover administrative expenses prior to the beginning of the
2011-12 shipping season as provided in the order (Sec. 917.38).
Continuance of Assessment Rates
The proposed assessment rates would continue in effect indefinitely
unless modified, suspended, or terminated by USDA upon recommendation
and information submitted by the Committees or other available
information.
Although these assessment rates would be in effect for an
indefinite period, the Committees will continue to meet prior to or
during each fiscal period to recommend budgets of expenses and consider
recommendations for modification of the assessment rates. The dates and
times of Committee meetings are available from the Committees' Web site
at http://www.eatcaliforniafruit.com or USDA. Committee meetings are
open to the public and interested persons may express their views at
these meetings. USDA would evaluate the Committees' recommendations and
other available information to determine whether modification of the
assessment rate for each Committee is needed. Further rulemaking would
be undertaken as necessary. The Committees' 2010-11 fiscal period
budgets 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) (5 U.S.C. 601-612), 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 101 California nectarine and peach handlers
subject to regulation under the orders covering nectarines and peaches
grown in California, and about 475 producers of these fruits in
California. Small agricultural service firms, which include handlers,
are defined by the Small Business Administration (SBA) (13 CFR 121.201)
as those having annual receipts of less than $7,000,000, and small
agricultural producers are defined as those having annual receipts of
less than $750,000. A majority of these handlers and producers may be
classified as small entities.
The Committees' staff has estimated that there are fewer than 50
handlers in the industry who would not be considered small entities.
For the 2009 season, the committees' staff estimated that the average
handler price received was $11.50 per container or container equivalent
of nectarines or peaches. A handler would have to ship at least 608,696
containers to have annual receipts of $7,000,000. Given data on
shipments maintained by the committees' staff and the average handler
price received during the 2009 season, the Committees' staff estimates
that small handlers represent approximately 50 percent of all the
handlers within the industry.
The Committees' staff has also estimated that fewer than 50
producers
[[Page 17074]]
in the industry would not be considered small entities. For the 2009
season, the Committees estimated the average producer price received
was $6.50 per container or container equivalent for nectarines and
peaches. A producer would have to produce at least 115,385 containers
of nectarines and peaches to have annual receipts of $750,000. Given
data maintained by the Committees' staff and the average producer price
received during the 2009 season, the Committees' staff estimates that
small producers represent more than 80 percent of the producers within
the industry.
With an average producer price of $6.50 per container or container
equivalent, and a combined packout of nectarines and peaches of
37,263,343 containers, the value of the 2009 packout is estimated to be
$242,211,730. Dividing this total estimated grower revenue figure by
the estimated number of producers (475) yields an estimate of average
revenue per producer of about $509,919 from the sales of peaches and
nectarines.
The nectarine and peach marketing orders provide authority for the
Committees, with the approval of USDA, to formulate an annual budget of
expenses and collect assessments from handlers to administer the
programs. The members of the NAC and PCC are producers of California
nectarines and peaches, respectively.
This rule would increase the assessment rates established for the
NAC for the 2010-11 and subsequent fiscal periods from $0.0175 to
$0.0280 per 25-pound container or container equivalent of nectarines
and for the PCC for the 2010-11 and subsequent fiscal periods from
$0.0025 to $0.026 per 25-pound container or container equivalent of
peaches.
The NAC recommended 2010-11 fiscal period expenditures of
$1,448,101 for nectarines and an assessment rate of $0.0280 per 25-
pound container or container equivalent of nectarines. The assessment
rate of $0.0280 is $0.0105 higher than the rate currently in effect.
The PCC recommended 2010-11 fiscal period expenditures of $1,839,651
for peaches and an assessment rate of $0.026 per 25-pound container or
container equivalent of peaches. The assessment rate of $0.026 is
$0.0235 higher than the rate currently in effect.
Analysis of NAC Budget
The quantity of assessable nectarines for the 2010-11 fiscal period
is estimated at 16,200,000 25-pound containers or container
equivalents. Thus, the $0.0280 rate should provide $453,600 in
assessment income. Income derived from handler assessments, along with
income from other sources and funds from the NAC's reserve, would be
adequate to cover budgeted expenses.
The major expenditures recommended by the NAC for the 2010-11 year
include $291,377 for administration, $157,016 for production research,
and $999,708 for domestic and international programs. Budgeted expenses
in 2009-10 were $319,965.32 for administration, $349,447.55 for
production research, and $1,127,877.33 for domestic and international
programs.
The NAC recommended an increased 2010-11 fiscal period assessment
rate because the 2009 crop was lower than expected due to a large
number of tree pullouts and other economic factors. Income generated
from the higher assessment rate combined with reserve funds should be
adequate to cover anticipated 2010-11 expenses.
Analysis of PCC Budget
The quantity of assessable peaches for the 2010-11 fiscal year is
estimated at 20,600,000 25-pound containers or container equivalents.
Thus, the $0.026 rate should provide $535,600 in assessment income.
The major expenditures recommended by PCC for the 2010-11 year
include $368,756 for administration, $199,662 for production research,
and $1,271,233 for domestic and international programs. Budgeted
expenses in 2009-10 were $334,058 for administration, $366,920 for
production research, and $1,184,272 for domestic and international
programs.
The PCC recommended an increased 2010-11 fiscal period assessment
rate because the 2009 crop was lower than expected due to a large
number of tree pullouts and other economic factors. Income generated
from the higher assessment rate combined with reserve funds should be
adequate to cover anticipated 2010-11 expenses.
Considerations in Determining Expenses and Assessment Rates
Prior to arriving at these budgets, the Committees considered
alternative expenditure and assessment rate levels, but ultimately
decided that the recommended levels were reasonable to properly
administer the orders.
Each of the Committees then reviewed the proposed expenses; the
total estimated assessable 25-pound containers or container
equivalents; and the estimated income from other sources, such as
interest income, prior to recommending a final assessment rate. The NAC
decided that an assessment rate of $0.0280 per 25-pound container or
container equivalent will allow it to meet its 2010-11 fiscal period
expenses and carryover an operating reserve of about $116,486 which is
in line with the Committee's financial needs. The PCC decided that an
assessment rate of $0.026 per 25-pound container or container
equivalent will allow it to meet its 2010-11 fiscal period expenses and
carryover an operating reserve of $147,502. These assessment rates
would allow them to meet their 2010-11 fiscal period expenses and
carryover necessary reserves to finance operations before 2011-12
fiscal period assessments are collected.
A review of historical and preliminary information pertaining to
the upcoming fiscal period indicates that the grower price for
nectarines and peaches for the 2010-11 season could range between $6.00
and $8.00 per 25-pound container or container equivalent. Therefore,
the estimated assessment revenue for the 2010-11 fiscal period as a
percentage of total grower revenue could range between 0.33 and 0.47
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 Committees' meetings were widely
publicized throughout the California nectarine and peach industries and
all interested persons were invited to attend the meetings and were
encouraged to participate in the Committees' deliberations on all
issues. Like all Committee meetings, the December 10, 2009, meetings
were public meetings and entities of all sizes 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 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.
[[Page 17075]]
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
Antoinette Carter 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 2010-11 fiscal period begins March 1, 2010, and the
marketing orders require that the rates of assessment for each fiscal
period apply to all assessable nectarines and peaches handled during
such fiscal period; (2) the Committees need to have sufficient funds to
pay its expenses which are incurred on a continuous basis; (3) handlers
are aware of this action which was unanimously recommended by the
Committees at public meetings and is similar to other assessment rate
actions issued in past years.
List of Subjects
7 CFR Part 916
Marketing agreements, Nectarines, Reporting and recordkeeping
requirements.
7 CFR Part 917
Marketing agreements, Peaches, Pears, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR parts 916 and 917
are proposed to be amended as follows:
1. The authority citation for 7 CFR parts 916 and 917 continues to
read as follows:
Authority: 7 U.S.C. 601-674.
PART 916--NECTARINES GROWN IN CALIFORNIA
2. Section 916.234 is revised to read as follows:
Sec. 916.234 Assessment rate.
On and after March 1, 2010, an assessment rate of $0.0280 per 25-
pound container or container equivalent of nectarines is established
for California nectarines.
PART 917--PEACHES GROWN IN CALIFORNIA
3. Section 917.258 is revised to read as follows:
Sec. 917.258 Assessment rate.
On and after March 1, 2010, an assessment rate of $0.026 per 25-
pound container or container equivalent of peaches is established for
California peaches.
Dated: March 30, 2010.
Rayne Pegg,
Administrator, Agricultural Marketing Service.
[FR Doc. 2010-7568 Filed 4-2-10; 8:45 am]
BILLING CODE P