[Federal Register: September 12, 2005 (Volume 70, Number 175)]
[Proposed Rules]
[Page 53737-53739]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12se05-5]
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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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[[Page 53737]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 987
[Docket No. FV05-987-1 PR]
Domestic Dates Produced or Packed in Riverside County, CA;
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 California Date Administrative Committee (committee) for the 2005-
06 and subsequent crop years from $0.85 to $0.95 per hundredweight of
dates handled. The committee locally administers the marketing order
which regulates the handling of dates produced or packed in Riverside
County, California. Assessments upon date handlers are used by the
committee to fund reasonable and necessary expenses of the program. The
committee recommended increasing the assessment rate because additional
revenues are needed to fund program operations and build up its
financial reserve to a more satisfactory level. The crop year begins
October 1 and ends September 30. The assessment rate would remain in
effect indefinitely unless modified, suspended, or terminated.
DATES: Comments must be received by October 12, 2005.
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;
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.ams.usda.gov/fv/moab.html.
FOR FURTHER INFORMATION CONTACT: Toni Sasselli, Program Analyst, or
Terry Vawter, Marketing Specialist, California Marketing Field Office,
Fruit and Vegetable Programs, AMS, USDA; 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 Marketing Order No. 987, both as amended (7 CFR part
987), regulating the handling of domestic dates produced or packed in
Riverside County, California, hereinafter referred to as the ``order.''
The marketing agreement and order 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 order now in effect, California
date 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 dates
beginning on October 1, 2005, and continue until amended, suspended, or
terminated. This rule would 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 2005-06 and subsequent crop years from $0.85 to $0.95
per hundredweight of assessable dates handled.
The California date 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 producer-
handlers of California dates. 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 at a
public meeting. Therefore, all directly affected persons have an
opportunity to participate and provide input.
For the 2004-05 and subsequent crop years, the committee
recommended, and USDA approved, an assessment rate that would continue
in effect from crop year to crop 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 June 16, 2005, and unanimously recommended
2005-06 crop year expenditures of $169,197 and an assessment rate of
$0.95 per hundredweight of dates handled. In comparison, last year's
budgeted
[[Page 53738]]
expenditures were $223,000. The recommended assessment rate of $0.95 is
$0.10 higher than the rate currently in effect. The increase in the
assessment rate is needed to fund the committee's budget and maintain
an acceptable operating reserve.
Proceeds from sales of cull dates are deposited in a surplus
account for subsequent use by the committee in covering the surplus
pool share of the committee's expenses. Handlers may also dispose of
cull dates of their own production within their own livestock-feeding
operation; otherwise, such cull dates must be shipped or delivered to
the committee for sale to non-human food product outlets. Pursuant to
Sec. 987.72(b), the committee is authorized to temporarily use funds
derived from assessments to defray expenses incurred in disposing of
surplus dates. All such expenses are required to be deducted from
proceeds obtained by the committee from the disposal of surplus dates.
For the 2005-06 crop year, the committee estimated that $2,000 from the
surplus account would be needed to refund assessments used in paying
committee expenses incurred in disposing of surplus dates.
The budgeted administrative expenses for the 2005-06 crop year
include $85,697 for labor and office expenses. This compares to $90,427
in labor and office expenses in 2004-05. In addition, $70,000 has been
budgeted for marketing and promotion under the program for the 2005-06
crop year. This compares to $112,499 in budgeted marketing and
promotion expenses for the 2004-05 crop year. A total of $14,303 is
budgeted as a contingency reserve for 2005-06 to build up its financial
reserve. The committee did not include a contingency reserve in last
year's budget. The committee also proposed that $10,000 be included in
its 2005-2006 budget for an economic analysis of its promotion
activities. Last year's budget did not include funds for this purpose.
The assessment rate of $0.95 per hundredweight of assessable dates
was derived by applying the following formula where:
A = 2004-05 reserve on 10/1/05 ($1,000).
B = 2005-06 reserve on 9/30/06 ($14,303).
C = 2005-06 expenses ($169,197).
D = Cull Surplus Fund ($2,000).
E = 2005-06 expected shipments (190,000 hundredweight). (B - A + C
- D) / E = $0.95 per hundredweight.
Estimated shipments should provide $180,500 in assessment income.
Income derived from handler assessments and $2,000 from the cull
surplus fund would be adequate to cover budgeted expenses. Funds in the
reserve are expected to total about $14,303 by September 30, 2006, and
therefore would be less than the maximum permitted by the order (not to
exceed 50 percent of the average of expenses incurred during the most
recent five preceding crop years as required under Sec. 987.72(c)).
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
crop 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 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 2005-06 budget and those
for subsequent crop years 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. Thus, both statutes have small
entity orientation and compatibility.
There are approximately 124 producers of dates in the production
area and approximately 10 handlers subject to regulation under the
marketing order. The Small Business Administration (13 CFR 121.201)
defines small agricultural producers as those having annual receipts of
less than $750,000, and small agricultural service firms are defined as
those having annual receipts of less than $6,000,000.
An industry profile shows that four of the 10 handlers (40 percent)
had date sales over $6,000,000 and could be considered large handlers
by the Small Business Administration. Six of the 10 handlers (60
percent) had date sales of less than $6,000,000 and could be considered
small handlers. An estimated 7 producers, or less than 6 percent, of
the 124 total producers, would be considered large producers with
annual incomes over $750,000. The remaining the producers have incomes
less than $750,000. The majority of handlers and producers of
California dates may be classified as small entities.
This rule would increase the assessment rate established for the
committee and collected from handlers for the 2005-06 and subsequent
crop years from $0.85 to $0.95 per hundredweight of assessable dates
handled. The committee unanimously recommended 2005-06 expenditures of
$169,197 and the $0.95 per hundredweight assessment rate at its meeting
on June 16, 2005. The proposed assessment rate of $0.95 is $0.10 higher
than the rate currently in effect. The quantity of assessable dates for
the 2005-06 crop year is estimated at 190,000 hundredweight. Thus, the
$0.95 per hundredweight rate should provide $180,500 in assessment
income. This, along with approximately $2,000 from the surplus account,
would be adequate to meet the committee's 2005-06 crop year expenses
and to augment its financial reserve.
The budgeted administrative expenses for the 2005-06 crop year
include $85,697, for labor and office expenses. This compares to
$90,427 in labor and office expenses in 2004-05. In addition, $70,000
has been budgeted for marketing and promotion under the program for the
2005-06 crop year. This compares to $112,499 in budgeted marketing and
promotion expenses for the 2004-05 crop year. A total of $14,303 is
budgeted to be carried over as a financial reserve for 2005-06. The
committee also proposed that $10,000 be included in the budget for an
economic analysis of its promotion program for the 2005-06 crop year,
as required by USDA.
The committee reviewed and unanimously recommended 2005-06
expenditures of $169,197 which include marketing and promotion
programs. Prior to arriving at this budget, the committee considered
alternative expenditure levels and alternative assessment levels. The
committee agreed that the increased assessment rate was appropriate to
cover expenses and build up its operating reserve to a
[[Page 53739]]
satisfactory level ($14,303). The assessment rate of $0.95 per
hundredweight of assessable dates was then determined by applying the
following formula where:
A = 2004-05 reserve on 10/1/05 ($1,000).
B = 2005-06 reserve on 9/30/06 ($14,303).
C = 2005-06 expenses ($169,197).
D = Cull Surplus Fund ($2,000).
E = 2005-06 expected shipments (190,000 hundredweight). (B - A + C
- D) E / $0.95 per hundredweight.
Estimated shipments should provide $180,500 in assessment income.
Income derived from handler assessments and $2,000 from the cull
surplus fund would be adequate to cover budgeted expenses. Funds in the
administrative reserve are expected to total about $14,303 by September
30, 2006, and therefore would be less than the maximum permitted by the
order (not to exceed 50 percent of the average of expenses incurred
during the most recent five preceding crop years as required under
Sec. 987.72(c)).
A review of historical information and preliminary information
pertaining to the upcoming crop year indicates that the grower price
for the 2005-06 season could range between $45 and $50 per
hundredweight of dates. Therefore, the estimated assessment revenue for
the 2005-06 crop year as a percentage of total grower revenue is
approximately 2 percent.
This action would increase the assessment obligation imposed on
handlers under the Federal marketing order. 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 California date industry
and all interested persons were invited to attend the meeting and
participate in committee deliberations on all issues. Like all
committee meetings, the June 16, 2005, 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 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 California date
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 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 30-day comment period is provided to allow interested persons to
respond to this proposed rule. Thirty days is deemed appropriate
because: (1) The 2005-06 crop year begins on October 1, 2005, and the
marketing order requires that the rate of assessment for each crop year
apply to all assessable dates handled during such crop year; (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 987
Dates, Marketing agreements, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 987 is
proposed to be amended as follows:
PART 987--DOMESTIC DATES PRODUCED OR PACKED IN RIVERSIDE COUNTY,
CALIFORNIA
1. The authority citation for 7 CFR part 987 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. Section 987.339 is revised to read as follows:
Sec. 987.339 Assessment rate.
On and after October 1, 2005, an assessment rate of $0.95 per
hundredweight is established for California dates.
Dated: September 6, 2005.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 05-17963 Filed 9-9-05; 8:45 am]
BILLING CODE 3410-02-P