[Federal Register: July 31, 2003 (Volume 68, Number 147)]
[Rules and Regulations]
[Page 44857-44859]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr31jy03-1]
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Rules and Regulations
Federal Register
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[[Page 44857]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 989
[Docket No. FV03-989-7 IFR]
Raisins Produced From Grapes Grown in California; Reduction in
Additional Storage Payments Regarding Reserve Raisins Intended for Use
as Cattle Feed
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
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SUMMARY: This rule reduces the additional holding and storage payments
regarding 2002 Natural (sun-dried) Seedless reserve raisins that are
carried into the 2003 crop year and intended for use as cattle feed.
The crop year runs from August 1 through July 31. Such payments are
authorized under the Federal marketing order for California raisins
(order). The order regulates the handling of raisins produced from
grapes grown in California and is administered locally by the Raisin
Administrative Committee (RAC). This action will reduce expenses
incurred by the 2002 reserve pool and thereby help improve returns to
2002 equity holders, primarily raisin producers.
DATES: Effective August 1, 2003. Comments received by September 29,
2003, 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 E-mail: moab.docketclerk@usda.gov.
All comments should reference the docket number and the date and page
number of this issue of the Federal Register and will be made available
for public inspection in the Office of the Docket Clerk during regular
business hours, or can be viewed at: http://www.ams.usda.gov/fv/moab.html
.
FOR FURTHER INFORMATION CONTACT: Maureen T. Pello, Senior Marketing
Specialist, California Marketing Field Office, Marketing Order
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 2202
Monterey Street, suite 102B, Fresno, California 93721; telephone: (559)
487-5901, Fax: (559) 487-5906; or George Kelhart, Technical Advisor,
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.
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 and Order No. 989 (7 CFR part 989), both as amended,
regulating the handling of raisins produced from grapes grown in
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. This rule is not intended to have retroactive effect.
This rule will not preempt any State or local laws, 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. A
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 reduces the additional holding and storage payments
regarding 2002 NS reserve raisins that are carried into the 2003 crop
year and intended for use as cattle feed. The crop year runs from
August 1 through July 31. Under the order, handlers are compensated for
receiving, storing, fumigating, and handling reserve tonnage raisins
acquired during a crop year. The order also authorizes additional
payments for reserve raisins held beyond the crop year of acquisition.
The RAC met on July 2, 2003, and unanimously recommended that
additional payments for reserve raisins intended for use as cattle feed
accrue beginning September 13, 2003, rather than August 1, 2003. This
action will reduce expenses incurred by the 2002 reserve pool and
thereby help improve returns to 2002 equity holders, primarily raisin
producers.
Volume Regulation Provisions
The order provides authority for volume regulation designed to
promote orderly marketing conditions, stabilize prices and supplies,
and improve producer returns. When volume regulation is in effect, a
certain percentage of the California raisin crop may be sold by
handlers to any market (free tonnage) while the remaining percentage
must be held by handlers in a reserve pool (reserve) for the account of
the RAC. Reserve raisins are disposed of through various programs
authorized under the order. For example, reserve raisins may be sold by
the RAC to handlers for free use or to replace part of the free tonnage
they exported; carried over as a hedge against a short crop the
following year; or may be disposed of in other outlets not competitive
with those for free tonnage
[[Page 44858]]
raisins, such as government purchase, distilleries, or animal feed. Net
proceeds from sales of reserve raisins are ultimately distributed to
the reserve pool's equity holders, primarily producers.
Costs Regarding Holding and Storage of Reserve Raisins
Section 989.66(f) of the order specifies that handlers be
compensated for receiving, storing, fumigating, and handling that
tonnage of reserve raisins determined by the reserve percentage of a
crop year and held by them for the account of the RAC, in accordance
with a schedule of payments established by the RAC and approved by the
Secretary. Further, the RAC must pay rent to producers or handlers for
boxes used in storing reserve raisins held beyond the crop year of
acquisition. As previously mentioned, the crop year runs from August 1
through July 31.
Section 989.401(b) of the order's rules and regulations specifies
additional payments to handlers for storing, handling, and fumigating
reserve raisins held beyond the crop year of acquisition. Specifically,
handlers must be compensated for such raisins at a rate of $2.30 per
ton for the first 3 months (August through October), and at a rate of
$1.18 per ton per month for the remaining 9 months (November through
July).
Section 989.401(c) specifies further payment of rental on boxes and
bins containing raisins held beyond the crop year of acquisition.
Specifically, persons who furnish boxes or bins used for storing
reserve raisins held for the account of the RAC on August 1 are
compensated for the use of such containers as follows: For boxes, 2\1/
2\ cents per day, not to exceed a total payment of $1.00 per box per
year, per average net weight of raisins in a sweatbox, with equivalent
rates for raisins in boxes other than sweatboxes; and for bins, 20
cents per day per bin, not to exceed a total of $10.00 per bin per
year.
Disposal Program
Pursuant to Sec. 989.67(b) of the order, the RAC is implementing a
program to dispose of 40,000 tons of 2002 NS reserve raisins for use as
cattle feed. The tonnage is stored at handler facilities and will be
adulterated to ensure that the raisins remain in non-commercial
channels. The program is intended to help the industry reduce its
burdensome oversupply of raisins. It will also help make available bins
for storing raisins during the new crop year, which begins August 1,
2003. Barring unforeseen circumstances, reserve tonnage intended for
use as cattle feed should be removed from handler premises by mid-
September 2003.
RAC Recommendation
The RAC met on July 2, 2003, and unanimously recommended reducing
the additional holding and storage payments regarding 2002 NS reserve
raisins held by handlers on August 1, 2003, and intended for use as
cattle feed. Specifically, additional payments for such raisins will
accrue beginning September 13, 2003, rather than August 1, 2003. Thus,
additional costs will only be incurred for such tonnage that remains at
handler premises after September 12, 2003. Payments for storing and
holding reserve raisins are deducted from reserve pool proceeds, and
net proceeds are ultimately distributed to equity holders. Thus,
reducing the expenses for 2002 NS reserve tonnage intended for use as
cattle feed will help improve returns to 2002 equity holders.
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 action 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 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 20 handlers of California raisins who are
subject to regulation under the order and approximately 4,500 raisin
producers in the regulated area. Small agricultural service firms are
defined by the Small Business Administration (13 CFR 121.201) as those
having annual receipts of less than $5,000,000, and small agricultural
producers are defined as those having annual receipts of less than
$750,000. Thirteen of the 20 handlers subject to regulation have annual
sales estimated to be at least $5,000,000, and the remaining 7 handlers
have sales less than $5,000,000. No more than 7 handlers, and a
majority of producers, of California raisins may be classified as small
entities.
This rule reduces the additional holding and storage payments
specified in paragraphs (b) and (c) of Sec. 989.401 regarding 2002 NS
reserve raisins that are intended for use as cattle feed. Specifically,
additional payments for such raisins will accrue beginning September
13, 2003, rather than August 1, 2003. Under the order, handlers are
compensated for receiving, storing, fumigating, and handling reserve
tonnage raisins acquired during a crop year. The order also authorizes
additional holding and storage payments for reserve raisins held beyond
the crop year of acquisition. This action reduces these additional
payments for 2002 NS reserve raisins held by handlers on August 1,
2003, that are intended for use as cattle feed. Authority for this
action is provided in Sec. 989.66(f) of the order.
Regarding the impact of this rule on affected entities, handlers
and producers, the order provides that handlers store reserve raisins
for the account of the RAC. Net proceeds from sales of such reserve
raisins are distributed to the reserve pool's equity holders, primarily
producers. Handlers are compensated from reserve pool funds for their
costs in receiving, storing, fumigating, and handling reserve raisins
during the crop year of acquisition and for the subsequent crop year.
Compensation is also paid for the use of bins and boxes for storing
reserve raisins held beyond the crop year of acquisition.
Under the disposal program, it is estimated that about 22,500 tons
of reserve raisins will remain at handler premises after August 1,
2003. If 634 tons were removed per day, costs to store, handle, and
fumigate the tonnage at the current rate of $2.30 per day between
August 1 and September 12, 2003, would be $59,133.00. Bin-rental costs
for the same period at the current rate of $0.20 per day per bin would
be $161,966.00. Thus, the RAC would incur an estimated $221,000 for
holding and storing 2002 reserve raisins that are intended for use as
cattle feed between August 1 and September 12, 2003. This rule will
reduce these costs to zero and thereby reduce expenses incurred by the
2002 NS reserve pool. Handlers, however, will not be compensated this
amount for holding and storing this tonnage.
Regarding alternatives to this action, one option would be to
maintain the status quo and have the 2002 reserve pool incur these
costs. However, this would not help to improve returns to 2002 equity
holders. Another alternative would be to reduce the payments for the
period August 1 through September 12, 2003, to figures lower than those
currently specified in Sec. 989.401. However, all RAC members
supported
[[Page 44859]]
reducing the additional holding and storage payments for 2002 reserve
raisins intended for use as cattle feed so that such payments will
accrue beginning September 13, 2003, rather than August 1, 2003.
This rule imposes no additional reporting or recordkeeping
requirements on either small or large raisin 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. Finally, USDA has not identified any
relevant Federal rules that duplicate, overlap or conflict with this
rule.
Further, the RAC's Administrative Issues Subcommittee and RAC
meetings on July 2, 2003, where this action was deliberated were both
public meetings widely publicized throughout the raisin industry. All
interested persons were invited to attend the meetings and participate
in the industry's deliberations. Finally, all interested persons are
invited to submit information on the regulatory and informational
impacts of this action on small businesses.
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/fv/moab.html.
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 60-day comment period is invited to allow interested persons to
respond to this rule. All written comments timely received will be
considered prior to finalization of this rule.
After consideration of all relevant material presented, including
the information and recommendation submitted by the RAC 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) This action needs to be in place by August 1,
2003, so that additional payments regarding reserve raisins held by
handlers on August 1, 2003, and intended for cattle feed will be
incurred beginning September 13, 2003, rather than August 1 2003; (2)
handlers and producers are aware of this action which was recommended
by the RAC at a public meeting; (3) the action was recommended by a
unanimous vote of the RAC; and (4) this interim final rule provides a
60-day comment period for written comments and all comments timely
received will be considered prior to finalization of this rule.
List of Subjects in 7 CFR Part 989
Grapes, Marketing agreements, Raisins, Reporting and recordkeeping
requirements.
0
For the reasons set forth in the preamble, 7 CFR part 989 is amended as
follows:
PART 989--RAISINS PRODUCED FROM GRAPES GROWN IN CALIFORNIA
0
1. The authority citation for 7 CFR part 989 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. In Sec. 989.401, paragraphs (b) and (c) are revised to read as
follows:
Sec. 989.401 Payments for services performed with respect to reserve
tonnage raisins.
* * * * *
(b) Additional payment for reserve tonnage raisins held beyond the
crop year of acquisition. Additional payment for reserve tonnage
raisins held beyond the crop year of acquisition shall be made in
accordance with this paragraph. Each handler holding such raisins for
the account of the Committee on August 1 shall be compensated for
storing, handling, and fumigating such raisins at the rate of $2.30 per
ton per month, or any part thereof, between August 1 and October 31,
and at the rate of $1.18 per ton per month, or any part thereof,
between November 1 and July 31: Provided, That handlers holding 2002-03
Natural (sun-dried) Seedless reserve raisins on August 1, 2003, that
are intended for use as cattle feed shall be compensated for storing,
handling, and fumigating such raisins at the rate of $2.30 per ton per
month, or any part thereof, between September 13 and October 31, 2003,
and at the rate of $1.18 per ton per month, or any part thereof,
between November 1, 2003, and July 31, 2004. Such services shall be
completed so that the Committee is assured that the raisins are
maintained in good condition.
(c) Payment of rental on boxes and bins containing raisins held
beyond the crop year of acquisition. Payment of rental on boxes and
bins containing reserve tonnage raisins held beyond the crop year of
acquisition shall be made in accordance with this paragraph. Each
handler, producer, dehydrator, and other person who furnishes boxes or
bins in which such raisins are held for the account of the Committee on
August 1, shall be compensated for the use of such boxes and bins:
Provided, That persons holding 2002-03 Natural (sun-dried) Seedless
reserve raisins on September 13, 2003, that are intended for use as
cattle feed shall be compensated for the use of such boxes and bins,
and that no compensation shall be accrued for such raisins held between
August 1 and September 12, 2003. The rate of compensation shall be: For
boxes, two and one-half cents per day, not to exceed a total payment of
$1 per box per year, per average net weight of raisins in a sweatbox,
with equivalent rates for raisins in boxes other than sweatboxes; and
for bins 20 cents per day per bin, not to exceed a total of $10 per bin
per year. For purposes of this paragraph, box means any container with
a capacity of less than 1,000 pounds, and bin means any container with
a capacity of 1,000 pounds or more. The average net weight of raisins
in each type of box shall be the industry average as computed by the
Committee for the box in which the raisins are so held. No further
compensation shall be paid unless the raisins are so held in the boxes
on the succeeding August 1.
* * * * *
Dated: July 25, 2003.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 03-19492 Filed 7-28-03; 1:04 pm]
BILLING CODE 3410-02-P