[Federal Register: September 3, 2003 (Volume 68, Number 170)]
[Rules and Regulations]
[Page 52332-52334]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr03se03-3]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 948
[Docket No. FV03-948-2 FR]
Irish Potatoes Grown in Colorado; Reinstatement of the Continuing
Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This rule reinstates the continuing assessment rate
established for the Area No. 3 Colorado Potato Administrative Committee
(Committee) for the 2003-2004 and subsequent fiscal periods at $0.03
per hundredweight of potatoes handled. The Committee locally
administers the marketing order regulating the handling of potatoes
grown in northern Colorado. The continuing assessment rate was
suspended for the 2001-2002 and subsequent fiscal periods to bring the
monetary reserve within the program limit of two fiscal periods'
operating expenses. Authorization to assess potato handlers enables the
Committee to incur expenses that are reasonable and necessary to
administer the program. The fiscal period began July 1 and ends June
30. The assessment rate will remain in effect indefinitely unless
modified, suspended, or terminated.
EFFECTIVE DATE: September 4, 2003.
FOR FURTHER INFORMATION CONTACT: Teresa Hutchinson, Marketing
Specialist, Northwest Marketing Field Office, Marketing Order
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 SW
Third Avenue, suite 385, Portland, Oregon 97204; telephone: (503) 326-
2724, Fax: (503) 326-7440; 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 No. 97 and Order No. 948, both as amended (7 CFR part 948),
regulating the handling of potatoes grown in Colorado, 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, Colorado
potato handlers are subject to assessments. Funds to administer the
order are derived from such assessments. It is intended that the
[[Page 52333]]
assessment rate established herein would be applicable to all
assessable potatoes beginning on July 1, 2003, 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 reinstates Sec. 948.215 of the order's rules and
regulations and establishes a continuing assessment rate for the
Committee for the 2003-2004 and subsequent fiscal periods at $0.03 per
hundredweight of potatoes handled.
The Colorado potato 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
Colorado potatoes. 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 2001-2002 and subsequent fiscal periods, the Committee
recommended, and USDA approved, a suspension of the continuing
assessment rate that would remain suspended until reinstated by USDA
upon recommendation and information submitted by the Committee or other
information available to USDA.
The Committee met on May 8, 2003, and unanimously recommended 2003-
2004 expenditures of $19,737 and an assessment rate of $0.03 per
hundredweight of potatoes. In comparison, last year's budgeted
expenditures were also $19,737. For the 2001-2002 fiscal period, the
Committee recommended suspending the continuing assessment rate to
bring the monetary reserve within program limits of approximately two
fiscal periods' operating expenses (Sec. 948.78). At that time, the
reserve fund contained about $60,000. The Committee has been operating
for the last two years by drawing income from its reserve. With a
suspended assessment rate and a significant decrease in the number of
potato producers and acreage in Area No. 3, the reserve has rapidly
decreased to the current level of about $24,077. The Committee would
like to maintain the reserve at approximately this level, thus
reinstatement of the assessment rate at $0.03 per hundredweight is
needed.
The major expenditures recommended by the Committee for the 2003-
2004 fiscal period include $8,200 for salaries, $3,000 for rent
expense, and $1,750 for office expenses. Budgeted expenses for these
items in 2002-2003 were also $8,200, $3,000, and $1,750, respectively.
The assessment rate recommended by the Committee was derived by
dividing anticipated expenses by expected shipments of Colorado
potatoes. Colorado potato shipments for the year are estimated at
632,500 hundredweight which should provide $18,975 in assessment
income. Income derived from handler assessments along with interest and
rent income should be adequate to cover budgeted expenses. Funds in the
reserve (estimated at $24,077 as of June 30, 2003), will be kept within
the maximum permitted by the order (approximately two fiscal period's
expenses; Sec. 948.78).
The assessment rate reinstated 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 will be in effect for an indefinite
period, the Committee will 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 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 2003-2004 budget and those
for subsequent fiscal periods will be reviewed and, as appropriate,
approved by USDA.
Final 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 final 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. Thus, both statutes have small
entity orientation and compatibility.
Based on Committee data, there are 12 producers, (9 of whom are
also handlers) and 10 handlers (9 of whom are also producers) in the
production area subject to regulation under the order. Small
agricultural 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 whose annual
receipts are less than $750,000.
Based on Committee data, the production of Area No. 3 Colorado
potatoes for the 2001-2002 marketing year was 773,053 hundredweight.
Based on National Agricultural Statistics Service data, the average
producer price for Colorado summer potatoes for the 2001-2002 marketing
year was $6.70 per hundredweight. The average annual producer revenue
for the 12 Colorado Area No. 3 potato producers is therefore calculated
to be approximately $431,621. Using Committee data regarding each
individual handler's total shipments during the 2001-2002 marketing
year and a Committee estimated average f.o.b. price during the 2001-
2002 marketing year of $8.80 per hundredweight ($6.70 per hundredweight
plus estimated packing and handling costs of $2.10 per hundredweight),
all of the Colorado Area No. 3 potato handlers ship under $5,000,000
worth of potatoes. In view of the foregoing, it can be concluded that
the majority of the Colorado Area No. 3 potato producers and handlers
may be classified as small entities.
This rule reinstates Sec. 948.215 of the order's rules and
regulations and
[[Page 52334]]
establishes a continuing assessment rate for the Committee, to be
collected from handlers for the 2003-2004 and subsequent fiscal
periods, at $0.03 per hundredweight of potatoes. The Committee
recommended 2003-2004 expenditures of $19,727 and an assessment rate of
$0.03 per hundredweight. The quantity of Area No. 3 Colorado potatoes
for the 2003-2004 fiscal period is estimated at 632,500 hundredweight.
Thus, the $0.03 rate should provide $18,975 in assessment income. This
together with interest and rent income should be adequate to meet this
fiscal period's budgeted expenses.
The major expenditures recommended by the Committee for the 2003-
2004 fiscal period include $8,200 for salaries, $3,000 for rent
expense, and $1,750 for office expenses. Budgeted expenses for these
items in 2002-2003 were also $8,200, $3,000, and $1,750, respectively.
For the 2001-2002 fiscal period, the Committee recommended
suspending the continuing assessment rate to bring the monetary reserve
within program limits of approximately two fiscal periods' operating
expenses (Sec. 948.78). At that time, the reserve fund contained about
$60,000. The Committee has been operating for the last two years by
drawing income from its reserve. With a suspended assessment rate and a
significant decrease in the number of potato producers and acreage in
Area No. 3, the reserve has rapidly decreased to the current level of
about $24,000. The Committee would like to maintain the reserve at
approximately this level, thus reinstatement of the assessment rate is
needed.
The Committee discussed alternatives to this rule, including
alternative expenditure levels. Lower assessment rates were considered,
but not recommended because they would not generate the income
necessary to administer the program with adequate reserves.
The assessment rate of $0.03 per hundredweight of assessable
potatoes was determined by dividing the total recommended budget by the
quantity of assessable potatoes, estimated at 632,500 hundredweight for
the 2003-2004 fiscal period. This is approximately $1,402 above the
anticipated expenses when combined with interest and rent income, which
the Committee determined to be acceptable.
A review of historical information and preliminary information
pertaining to the upcoming fiscal period indicates that the producer
price for the 2003-2004 fiscal period could range between $5.10 and
$6.70 per hundredweight of Colorado summer potatoes. Therefore, the
estimated assessment revenue for the 2003-2004 fiscal period as a
percentage of total producer revenue could range between 0.45 and 0.59
percent.
This action increases 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
are offset by the benefits derived by the operation of the marketing
order. In addition, the Committee's meeting was widely publicized
throughout the Area No. 3 Colorado potato industry and all interested
persons were invited to attend the meeting and participate in Committee
deliberations on all issues. Like all Committee meetings, the May 8,
2003, meeting was a public meeting and all entities, both large and
small, were able to express views on this issue.
This rule imposes no additional reporting or recordkeeping
requirements on either small or large Colorado Area No. 3 potato
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.
USDA has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this rule.
A proposed rule concerning this action was published in the Federal
Register on July 28, 2003 (68 FR 44239). Copies of the proposed rule
were also mailed or sent via facsimile to all Committee members.
Finally, the proposal was made available through the Internet by the
Office of the Federal Register and USDA. A 15-day comment period ending
August 12, 2003, was provided for interested persons to respond to the
proposal. No comments were received.
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.
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 that good
cause exists for not postponing the effective date of this rule until
30 days after publication in the Federal Register because the 2003-2004
fiscal period began on July 1, 2003, and the marketing order requires
that the rate of assessment for each fiscal period apply to all
assessable potatoes handled during such fiscal period. Further,
handlers are aware of this action which was recommended by the
Committee at a public meeting. Also, a 15-day comment period was
provided for in the proposed rule, and no comments were received.
List of Subjects in 7 CFR Part 948
Marketing agreements, Potatoes, Reporting and recordkeeping
requirements.
0
For the reasons set forth in the preamble, 7 CFR part 948 is amended as
follows:
PART 948--IRISH POTATOES GROWN IN COLORADO
0
1. The authority citation for 7 CFR part 948 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 948.215 is reinstated and revised to read as follows:
Sec. 948.215 Assessment rate.
On and after July 1, 2003, an assessment rate of $0.03 per
hundredweight is established for Colorado Area No. 3 potatoes.
Dated: August 28, 2003.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 03-22416 Filed 9-2-03; 8:45 am]
BILLING CODE 3410-02-P