[Federal Register: April 12, 2007 (Volume 72, Number 70)]
[Rules and Regulations]
[Page 18343-18345]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12ap07-1]
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Rules and Regulations
Federal Register
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[[Page 18343]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 932
[Docket No. AMS-FV-06-0225; FV07-932-1 FR]
Olives Grown in California; Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: This rule increases the assessment rate established for the
California Olive Committee (committee) for the 2007 and subsequent
fiscal years from $11.03 to $47.84 per assessable ton of olives
handled. The committee locally administers the marketing order which
regulates the handling of olives grown in California. Assessments upon
olive handlers are used by the committee to fund reasonable and
necessary expenses of the program. The fiscal year began January 1 and
ends December 31. The assessment rate will remain in effect
indefinitely unless modified, suspended, or terminated.
DATES: Effective April 13, 2007.
FOR FURTHER INFORMATION CONTACT: Jennifer R. Garcia, 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: Jennifer.Garcia@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
Agreement No. 148 and Order No. 932, both as amended (7 CFR part 932),
regulating the handling of olives 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. Under the marketing order now in effect, California
olive 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 would be applicable to all assessable
olives beginning on January 1, 2007, 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 increases the assessment rate established for the
committee for the 2007 and subsequent fiscal years from $11.03 to
$47.84 per ton of assessable olives from the applicable crop years.
The California olive 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 fiscal year, which is the 12-month period between January
1 and December 31, begins after the corresponding crop year, which is
the 12-month period beginning August 1 and ending July 31 of the
subsequent year. Fiscal year budget and assessment recommendations are
made after the corresponding crop year olive tonnage is reported. The
members of the committee are producers and handlers of California
olives. They are familiar with the committee's needs and with 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 discussed in a public meeting. Thus, all directly affected
persons have an opportunity to participate and provide input.
For the 2006 and subsequent fiscal years, the committee
recommended, and USDA approved, an assessment rate that would continue
in effect from fiscal year to fiscal 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 December 12, 2006, and unanimously recommended
2007 fiscal year expenditures of $950,396 and an assessment rate of
$47.84 per ton of assessable olives. In comparison, the budgeted
expenditures for fiscal year 2006 were $1,301,121. The assessment rate
of $47.84 is $36.81 higher than the rate currently in effect. The
committee recommended the higher assessment rate because the 2006-07
assessable olive receipts as reported by the California Agricultural
Statistics Service (CASS) are only 16,270 tons, which compares to
114,761 tons in 2005-06. Unusual weather conditions, including a wet
winter and very hot summer, contributed to a substantially smaller
crop. The committee also plans to use available reserve funds to help
meet its 2007 expenses.
The major expenditures recommended by the committee for the 2007
fiscal year include $365,775 for research, $332,450 for marketing
activities, and $252,171 for administration. Budgeted expenditures for
these items in 2006 were $210,000, $800,700, and $290,421,
respectively. The committee recommended a larger
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2007 research budget so it can continue its ongoing olive fly research
and research to develop a mechanical olive harvesting method. The 2007
marketing program would be scaled back. Recommended decreases in the
administrative budget are due mainly to tighter budgeting in several
areas.
The assessment rate recommended by the committee was derived by
considering anticipated fiscal year expenses, actual olive tonnage
received by handlers during the 2006-07 crop year, and additional
pertinent factors. Actual assessable tonnage for the 2007 fiscal year
is expected to be lower than the 2006-07 crop receipts of 16,270 tons
reported by the CASS because some olives may be diverted by handlers to
uses that are exempt from marketing order requirements. Income derived
from handler assessments, along with funds from the committee's
authorized reserve and interest income, would be adequate to cover
budgeted expenses. Funds in the reserve would be kept within the
maximum permitted by the order of approximately one fiscal year's
expenses (Sec. 932.40).
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 will be in effect for an indefinite
period, the committee will continue to meet prior to or during each
fiscal 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 2007 budget and those for
subsequent fiscal years 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.
There are approximately 850 producers of olives in the production
area and 2 handlers subject to regulation under the marketing order.
Small agricultural producers are defined by the Small Business
Administration (13 CFR 121.201) 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.
Based upon information from the committee, the majority of olive
producers may be classified as small entities. Both of the handlers may
be classified as large entities.
This rule increases the assessment rate established for the
committee and collected from handlers for the 2007 and subsequent
fiscal years from $11.03 to $47.84 per ton of assessable olives. The
committee unanimously recommended 2007 expenditures of $950,396 and an
assessment rate of $47.84 per ton. The proposed assessment rate of
$47.84 is $36.81 higher than the 2006 rate. The higher assessment rate
is necessary because assessable olive receipts for the 2006-07 crop
year were reported by the CASS to be 16,270 tons, compared to 114,761
tons for the 2005-06 crop year. Actual assessable tonnage for the 2007
fiscal year is expected to be lower because some of the receipts may be
diverted by handlers to exempt outlets on which assessments are not
paid.
Income generated from the $47.84 per ton assessment rate should be
adequate to meet this year's expenses when combined with funds from the
authorized reserve and interest income. Funds in the reserve would be
kept within the maximum permitted by the order of about one fiscal
year's expenses (Sec. 932.40).
Expenditures recommended by the committee for the 2007 fiscal year
include $365,775 for research, $332,450 for marketing activities, and
$252,171 for administration. Budgeted expenses for these items in 2006
were $210,000, $800,700, and $290,421 respectively. The committee
recommended a larger 2007 research budget so it can continue its olive
fly research projects and research to develop a mechanical olive
harvesting method. The 2007 marketing program would be scaled back.
Recommended decreases in the administrative budget are due mainly to
tighter budgeting in several areas.
Prior to arriving at this budget, the committee considered
information from various sources, such as the committee's Executive,
Market Development, and Research Subcommittees. Alternate spending
levels were discussed by these groups, based upon the relative value of
various research and marketing projects to the olive industry and the
reduced olive production. The assessment rate of $47.84 per ton of
assessable olives was derived by considering anticipated expenses, the
volume of assessable olives and additional pertinent factors.
A review of historical information indicates that the grower price
for the 2006-07 crop year was approximately $960.57 per ton for canning
fruit and $344.56 per ton for limited-use sizes, leaving the balance as
unusable cull fruit. Approximately 87 percent of a ton of olives are
canning fruit sizes and 9 percent are limited use sizes, leaving the
balance as unusable cull fruit. Grower revenue on 16,270 total tons of
canning and limited-use sizes would be $14,704,092 given the current
grower prices for those sizes. Therefore, with an assessment rate
increased from $11.03 to $47.84, the estimated assessment revenue is
expected to be approximately 5 percent of grower revenue.
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
will be offset by the benefits derived by the operation of the
marketing order. In addition, the committee's meeting was widely
publicized throughout the California olive industry and all interested
persons were invited to attend the meeting and participate in committee
deliberations on all issues. Like all committee meetings, the December
12, 2006, 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 California olive 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.
The 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
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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 proposed rule concerning this action was published in the Federal
Register on March 7, 2007 (72 FR 10091). Copies of the proposed rule
were also mailed or sent via facsimile to all olive handlers. Finally,
the proposal was made available through the Internet by USDA and the
Office of the Federal Register. A 15-day comment period ending March
22, 2007, 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: (1) The 2007
fiscal year began on January 1, 2007, and the marketing order requires
that the rate of assessment for each fiscal year apply to all
assessable olives handled during such fiscal year; (2) the committee
needs sufficient funds to pay its expenses, which are incurred on a
continuous basis; and (3) handlers are aware of this action, which was
discussed by the committee and unanimously recommended at a public
meeting, and is similar to other assessment rate actions issued in past
years. Also, a 15-day comment period was provided for in the proposed
rule.
List of Subjects in 7 CFR Part 932
Marketing agreements, Olives, Reporting and recordkeeping
requirements.
0
For the reasons set forth in the preamble, 7 CFR part 932 is proposed
to be amended as follows:
PART 932--OLIVES GROWN IN CALIFORNIA
0
1. The authority citation for 7 CFR part 932 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 932.230 is revised to read as follows:
Sec. 932.230 Assessment rate.
On and after January 1, 2007, an assessment rate of $47.84 per ton
is established for California olives.
Dated: April 9, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 07-1832 Filed 4-10-07; 1:10 pm]
BILLING CODE 3410-02-P