[Federal Register: June 19, 2006 (Volume 71, Number 117)]
[Proposed Rules]
[Page 35201-35203]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr19jn06-22]
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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 35201]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 983
[Docket No. FV06-983-2 PR]
Pistachios Grown in California; Modification of Small Handler
Exemption
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This rule invites comments on modifications to the current
handling requirements prescribed under the California pistachio
marketing order (order). The order regulates the handling of pistachios
grown in California and is administered locally by the Administrative
Committee for Pistachios (committee). The proposed modification would
increase the exemption threshold for pistachio handlers who handle
small amounts of pistachios, primarily for home or personal use.
Currently, handlers of 1,000 pounds or less of hulled and dried
pistachios (assessed weight) are exempt from most handling
requirements. Under this proposal, the exemption would be extended to
handlers of less than 5,000 pounds of assessed weight pistachios. This
change is not expected to have a significant impact on the overall
quality of California pistachios found in the marketplace.
DATES: Comments must be received by July 10, 2006.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposal. 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. 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: Terry Vawter, Senior 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.
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 proposal is issued under Marketing
Order No. 983 (7 CFR part 983), regulating the handling of pistachios
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 proposal has been reviewed under Executive Order 12988, Civil
Justice Reform. This rule is not intended to have retroactive effect.
This proposal 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. 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 proposal invites comments on modifications to the current
handling requirements prescribed under the California pistachio order.
This proposed modification would increase the exemption threshold for
pistachio handlers who handle small amounts of pistachios from the
current level of 1,000 pounds or less of assessed weight pistachios to
less than 5,000 pounds of assessed weight pistachios. Under this
proposal, pistachio handlers who handle less than 5,000 pounds of
assessed weight pistachios would be exempt from most handling
requirements established under the order, including those relating to
aflatoxin testing, minimum quality inspection, and payment of
assessments.
Previous rules, one section of the order, and two sections of the
rules and regulations refer to ``dried pounds'' or ``dried weight'' of
pistachios. While these terms are not defined in the order, they are
generally interchangeable with the defined term ``assessed weight.''
For the purposes of this proposed rule, the term ``assessed weight''
will be used.
Section 983.70 of the pistachio order currently exempts any handler
who handles 1,000 pounds or less of assessed weight pistachios in any
production year from the requirements of Sec. Sec. 983.38 through
938.45 and Sec. 983.53 of the order. A ``production year'' begins on
September 1 and ends the following August 31.
Section 983.38 of the order establishes a maximum aflatoxin level
and the aflatoxin testing protocol, among other things.
Section 983.39 of the order establishes minimum quality levels in
terms of maximum defects and minimum sizes.
Section 983.40 of the order establishes procedures for reworking
pistachios that fail to meet the requirements prescribed in Sec. Sec.
983.38 and 983.39.
Section 983.41 of the pistachio order authorizes alternative
aflatoxin testing methods for handlers handling less than 1 million
pounds of assessed weight pistachios per production year, and
authorizes the committee to grant such handlers exemptions from minimum
quality testing requirements.
[[Page 35202]]
Section 983.42 of the order permits commingling of inspected and
certified lots with other inspected and certified lots.
Section 983.43 of the order authorizes rules and regulations to
establish conditions under which pistachios would be subject to
reinspection.
Under Sec. 983.44 of the order, all pistachios required to be
inspected and certified may be subject to container marking or other
identification requirements.
Section 983.45 of the order requires the committee (with USDA's
approval) to establish reporting and disposition procedures for
substandard pistachios (those not meeting aflatoxin and minimum quality
requirements).
Finally, Sec. 983.53 of the order authorizes handler assessment to
defray program administrative costs.
The committee met on March 1, 2006, and unanimously recommended
increasing the current handler exemption from including handlers that
handle 1,000 pounds or less of assessed weight pistachios to handlers
that handle less than 5,000 pounds of assessed weight pistachios. This
action is authorized under Sec. 983.70 of the order, and would be
implemented by adding a new section in the marketing order's rules and
regulations (Sec. 983.170 Handler exemption). This rule would also
make conforming changes to the order's rules and regulations to reflect
the change in the exemption level.
Specifically, the new Sec. 983.170 would exempt handlers who
handle less than 5,000 pounds of assessed weight pistachios in a
production year from the requirements of Sec. Sec. 983.38 through
983.45 and Sec. 983.53 of the order.
In addition, conforming changes would be necessary in Sec.
983.143, paragraph (b)(2), as well as in Sec. 983.147, paragraphs (c)
and (g), to clarify that the handling exemption applies to handlers of
less than 5,000 pounds of assessed weight pistachios rather than the
currently-applicable level of 1,000 pounds or less of assessed weight
pistachios.
The committee estimates that the amount of pistachios handled by
handlers with less than 5,000 pounds of assessed weight pistachios is
approximately 48,515 pounds of the total 283,419,713 pounds handled in
the 2005-2006 production year, or less than 0.02 percent of all
pistachios handled that production year. In the committee's opinion,
quantities of pistachios that are less than 5,000 pounds are not
commercially-significant and are unlikely to have an impact in the
marketplace. These pistachios would likely be sold at local farmers'
markets; kept for home use; distributed to friends, neighbors, business
associates, or others; or used for other non-commercial purposes,
rather than enter the conventional channels of trade.
Exempt handlers would continue to file the required report, the
ACP-4, with the committee by November 15 of each production year (Sec.
983.147 Reports). Also, under the authority contained in Sec. 983.50,
Random verification audits, and Sec. 983.51, Verification of reports,
the committee would maintain the right to spot-check these handlers to
ensure marketing order compliance.
The committee noted that when the order was promulgated, there was
limited information about pistachio handlers and the volumes of
pistachios each handled. Thus, the initial order provided for what was
believed to be a reasonable exemption level of 1,000 pounds or less of
assessed weight pistachios. After operating under the marketing order
regulations for approximately one year, the committee believes that the
handling exemption level is too low and recommended this proposed
relaxation.
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 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 50 handlers of California pistachios who
are subject to regulation under the order and about 741 producers of
pistachios in the production area. This proposal would result in about
28 of the current handlers being exempt from most regulatory provisions
of the order. The number of known handlers has increased since the
committee began operation because they now have the authority under the
order to gather information about handlers.
The Small Business Administration (SBA) (13 CFR 121.201) defines
small agricultural service firms as those having annual receipts of
less than $6,500,000 and defines small agricultural producers as those
having annual receipts of less than $750,000. Thirty-three of the 50
handlers subject to regulation have annual pistachio receipts of less
than $6,500,000. In addition, 722 of the 741 producers have annual
receipts less than $750,000. Therefore, a majority of handlers (66
percent) and producers (97 percent) may be classified as small entities
under the SBA standards.
This proposal would increase the current handling exemption level
for handlers from 1,000 pounds or less of assessed weight pistachios to
less than 5,000 pounds of assessed weight pistachios. Exempt handlers
could handle their pistachios free from the requirements of Sec. Sec.
983.38 through 983.45 and Sec. 983.53 of the order.
The committee met on March 1, 2006, to consider the handling
exemption and unanimously recommended revising the level from 1,000
pounds or less of assessed weight pistachios to less than 5,000 pounds
of assessed weight pistachios handled per production year.
The committee estimates that the total volume of pistachios handled
by the 28 handlers with less than 5,000 pounds of assessed weight
pistachios is approximately 48,515 pounds of the total 283,419,713
pounds handled in the 2005-2006 production year. This represents less
than 0.02 percent of all pistachios handled that production year. In
the committee's opinion, 5,000 pounds of assessed weight pistachios is
not commercially-significant and represents pistachios that are
unlikely to enter conventional channels of trade.
The committee also noted that when the order was promulgated, there
was very little information about pistachio handlers and their relative
volumes. The initial order provided for what was believed to be a
reasonable exemption level of 1,000 pounds or less of assessed weight
pistachios. The committee now believes that the exemption level is too
low and should be increased.
The committee recommendation on March 1, 2006, resulted from
deliberations of its Technical Subcommittee (subcommittee), the
subcommittee charged with compliance, quality, and inspection issues
under the order. The March 1, 2006, meeting of the subcommittee was
also a public meeting, where opinions and concerns of industry
representatives were solicited, openly discussed, and deliberated at
some length.
The subcommittee and committee discussed alternatives to this
modification, including not making any changes or modifying the
handling exemption for handlers of less than 10,000 pounds of assessed
weight pistachios. Both the subcommittee and
[[Page 35203]]
the committee ultimately determined that exempting handlers of less
than 5,000 pounds of assessed weight pistachios was prudent because
only 14 additional handlers would be affected, and the total volume of
exempted pistachios handled is relatively insignificant (less than 0.02
percent of total production). Thus, exempting an estimated total of 28
handlers with less than 5,000 pounds of assessed weight pistachios
would not affect the overall quality of the pistachios handled as those
pistachios are likely to be for home or personal use and will not
compete in traditional markets.
Both the subcommittee and the committee noted that spot-checks on
small handlers would be continued to ensure compliance with order
requirements.
This action would reduce reporting requirements for pistachio
handlers who fall below the 5,000 pound threshold. Such handlers would
also be exempt from most of the other regulatory requirements imposed
under the authority.
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.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the information collection requirements that are contained
in this rule have previously been approved by the Office of Management
and Budget (OMB), and have been assigned OMB No. 0581-0215.
AMS is committed to compliance with the Government Paperwork
Elimination Act (GPEA), which requires Government agencies in general
to provide the public the option of submitting information or
transacting business electronically to the maximum extent possible.
In addition, USDA has not identified any relevant Federal rules
that duplicate, overlap or conflict with this proposed rule.
Further, the committee's meetings are widely publicized throughout
the pistachio industry and all interested persons are encouraged to
attend the meetings and participate in the committee's deliberations.
In this respect, the March 1, 2006, subcommittee and committee meetings
regarding the handler exemption were public meetings and all entities,
both large and small, were encouraged to express their views on this
issue.
The committee recommendation on March 1, 2006, resulted from
deliberations of its Technical Subcommittee, which is charged with
compliance, quality, and inspection issues under the marketing order.
During the subcommittee meeting, the opinions and concerns of industry
representatives were solicited, openly discussed, and deliberated at
some length. The subcommittee made its unanimous recommendation to the
committee, who agreed with the recommendation unanimously, as well.
Finally, 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 20-day comment period is provided to allow interested persons to
respond to this proposal. Twenty days is deemed appropriate because
this rule should be in place by September 1, 2006, the beginning of the
crop year, and is a relaxation of current handling requirements. All
written comments received by the end of the comment period will be
considered before a final determination is made on this matter.
List of Subjects in 7 CFR Part 983
Marketing agreements, Pistachios, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 983 is
proposed to be amended as follows:
PART 983--PISTACHIOS GROWN IN CALIFORNIA
1. The authority citation for 7 CFR part 983 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. In Sec. 983.143, revise paragraph (b)(2) to read as follows:
Sec. 983.143 Reinspection.
* * * * *
(b) * * *
(2) Handlers exempted from order requirements under Sec. 983.170
are exempt from all reinspection requirements.
3. In Sec. 983.147, paragraphs (c) and (g) are revised to read as
follows:
Sec. 983.147 Reports.
* * * * *
(c) ACP-4, Federal Marketing Order Exempt Handler Notification.
Each handler who handles less than 5,000 pounds of assessed weight
pistachios in a production year shall complete and furnish this report
to the committee no later than November 15 of each production year.
* * * * *
(g) Exemptions. Handlers who handle less than 5,000 pounds of
assessed weight pistachios during any production year are exempt from
filing all forms, with the exception of the ACP-4.
* * * * *
4. In part 983, Subpart--Rules and Regulations is amended by adding
new Sec. 983.170 to read as follows:
Sec. 983.170 Handler exemption.
Pursuant to Sec. 983.70, any handler may handle pistachios within
the production area free of the requirements in Sec. Sec. 983.38
through 983.45 and Sec. 983.53 if such pistachios are handled in
quantities of less than 5,000 pounds of assessed weight in any
production year.
Dated: June 12, 2006.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. E6-9539 Filed 6-16-06; 8:45 am]
BILLING CODE 3410-02-P