Watermelon Research and Promotion Plan; Proposed Amendments to the Plan, Rules and Regulations, Referendum Procedures, and Rules of Practice for Petitions

SUMMARY: This document gives notice of proposed amendments to the

Watermelon Research and Promotion Plan (Plan) to: Eliminate refunds of

assessments; assess watermelon imports and add one or more importer

members to the National Watermelon Promotion Board (Board); exempt from

assessments producers with less than 10 acres of watermelons rather

than 5 acres and importers of less than 150,000 pounds; cover all 50

States by the Plan; and revise the criteria for determining the

eligibility of producers to serve on the Board. In addition, conforming

changes would be made to the rules and regulations issued under the

Plan and the rules of practice for petitions, and the rules of practice

for referenda on the Plan would be revised to provide for referenda to

be conducted by mail ballot. These actions are necessary to implement

amendments to the Watermelon Research and Promotion Act.

DATES: Comments must be received by May 16, 1994.

ADDRESSES: Interested persons are invited to submit written comments

concerning this proposed rule to: Docket Clerk, Fruit and Vegetable

Division, AMS, USDA, P.O. Box 96456, room 2535-S, Washington, DC 20090-

6456. Three copies of all written materials should be submitted, and

they will be made available for public inspection in the Office of the

Docket Clerk during regular working hours. All comments should

reference the docket number of this issue of the Federal Register.

FOR FURTHER INFORMATION CONTACT:

Sonia N. Jimenez, Research and Promotion Branch, Fruit and Vegetable

Division, AMS, USDA, P.O. Box 96456, room 2535-S, Washington, DC 20090-

6456; telephone (202) 720-9916.

SUPPLEMENTARY INFORMATION: This proposed rule is issued under the

Watermelon Research and Promotion Plan [7 CFR Part 1210], hereinafter

referred as the Plan. The Plan is effective under the Watermelon

Research and Promotion Act, as amended by the Watermelon Research and

Promotion Improvement Act of 1993, [7 U.S.C. 4901-4916] hereinafter

referred as the Act.

This rule has been determined to be not significant for the

purposes of Executive Order 12866 and therefore has not been reviewed

by OMB.

This rule has been reviewed under Executive Order 12778, Civil

Justice Reform. It is not intended to have retroactive effect. 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 1650 of the Act, a

person subject to the Plan may file a petition with the Secretary

stating that the Plan or any provision of the Plan, or any obligation

imposed in connection with the Plan, is not in accordance with law and

requesting a modification of the Plan or an exemption from the Plan.

The petitioner is afforded the opportunity for a hearing on the

petition. After such hearing, the Secretary will make a ruling on the

petition. The Act provides that the district courts of the United

States in any district in which a person who is a petitioner resides or

carries on business are vested with jurisdiction to review the

Secretary's ruling on the petition, if a complaint for that purpose is

filed within 20 days after the date of the entry of the ruling.

Regulatory Flexibility Act

Pursuant to requirements set forth in the Regulatory Flexibility

Act (RFA), the Administrator of the Agricultural Marketing Service

(AMS) has considered the economic impact of this rule on small

entities.

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.

There are approximately 750 watermelon handlers and 5,000

watermelon producers in the contiguous 48 States of the United States

who are subject to the Plan. There are approximately 140 importers of

watermelons. Small agricultural service firms are defined by the Small

Business Administration [13 CFR 121.601] as those having annual

receipts of less than $3,500,000 and small agricultural producers are

defined as those having annual receipts of less than $500,000. The

majority of watermelon handlers, producers, and importers may be

classified as small entities.

The changes proposed to the Plan, rules and regulations, rules of

practice for petitions, and procedures for conduct of referenda are as

a result of amendments to the Act. The overall economic impact of these

proposed changes is not expected to be significant. Including all 50

States and the District of Columbia under the Plan would have little

impact. The producer exemption from assessments would be increased from

5 acres to 10 acres. This change would benefit small producers because

it will increase the exemption level, and small producers would not

have to pay the assessment. Neither the eligibility criteria for

determining if a person is a handler or a producer nor the change to

voting by mail ballot would have any economic impact. The elimination

of refunds may have some impact on a small amount of producers and

handlers who are currently entitled to refunds. There would also be a

new burden on importers caused by the assessment of imports, but

importers are currently benefiting from the activities which promote

watermelons without paying assessments. The research and promotion

program is expected to benefit producers, handlers, and importers

subject to the plan by expanding and maintaining new and existing

markets. Accordingly, the Administrator of AMS has determined that this

action would not have a significant economic impact on a substantial

number of small entities.

Paperwork Reduction

In accordance with the Paperwork Reduction Act of 1980 [40 U.S.C.

chapter 35], the information collection requirements contained in the

Plan have previously been approved by the Office of Management and

Budget (OMB) and assigned OMB number 0581-0093. There would be a new

reporting burden on importers but the burden has been already approved

by the OMB and assigned OMB control number 0581-0093. Therefore, this

action adds no additional reporting burden.

Under the Plan, the National Watermelon Promotion Board (Board)

administers a nationally coordinated program of research, development,

advertising, and promotion designed to strengthen the watermelon's

position in the market place and to establish, maintain, and expand

markets for domestic watermelons. This program is financed by

assessments on all producers, except those persons engaged in the

growing of less than five acres of watermelons, and handlers of

watermelons. The Plan specifies that handlers are responsible for

collecting and submitting both the producer and handler assessments to

the Board, reporting their handling of watermelons, and maintaining

records necessary to verify their reporting.

U.S. production of watermelons is estimated through the use of U.S.

shipment statistics. Shipments of U.S.-produced watermelons totaled

about 1,895.6 million pounds in 1993, 7 percent less than in 1992.

Imports of watermelons in 1993 totalled 343.5 million pounds, an

increase of 12 percent. Therefore, domestic production is about six

times as great as the volume of imports.

This proposed rule invites comments on changes to the Plan, the

rules and regulations issued thereunder, the rules of practice for

petitions, and the procedures for the conduct of referenda. The changes

are proposed in accordance with amendments to the Watermelon Research

and Promotion Act [7 U.S.C. 4901-4916] as made in the Watermelon

Research and Promotion Improvement Act of 1993.

The amendments to the Act authorize an assessment on watermelons

imported into the United States by importers, and the addition of

importer members to the Board if approved by watermelon producers,

handlers, and importers in a referendum. Watermelon imports enter the

country primarily during the winter season. Imports of watermelons in

1993 totalled 343.5 million pounds. The assessment rate for imports

would be the combined total assessment rate paid by producers and

handlers of domestic watermelons. The current assessment rate for

producers is 2 cents per hundredweight and for handlers is 2 cents per

hundredweight. The combined assessment rate for importers, therefore,

would be 4 cents per hundredweight. Assessments would be paid at the

time the watermelons enter the country. The collection of assessments

on imported watermelons would be expected to generate an additional

$137,400 per year in revenue to the Board. In order to make these

changes, this rule would amend Secs. 1210.200, 1210.201, 1210.202, and

1210.204 of the referendum procedures; Secs. 1210.305, 1210.320,

1210.321, 1210.328, 1210.341, 1210.350, 1210.351, 1210.352, 1210.363,

and 1210.364 of the Plan; Secs. 1210.402 and 1210.405 of the nomination

procedures; and Secs. 1210.515, 1210.518, 1210.519, 1210.521, 1210.530,

1210.531, and 1210.532 of the rules and regulations. In addition, a new

Sec. 1210.314 would be added to the Plan.

To facilitate the collection of assessments on imported

watermelons, the Secretary proposes that the United States Customs

Service of the Department of the Treasury be designated as the

collecting agency for assessments levied on such imports. Other

commodity research and promotion programs utilize the Customs Service

as a means of collecting assessments on imported products, and the

Customs Service is agreeable to collecting these watermelon

assessments. An agreement between the USDA and the Customs Service

would be entered into to implement this action. In order to make this

change, this rule would amend section 1210.518 of the Rules and

Regulations.

The importer representation on the Board would be proportionate to

the percentage of assessments paid by importers to the Board, except

that at least one representative of importers would serve on the Board

if importers are subject to the Plan. This representation would enable

importers to participate in developing the Board's programs, plans, and

projects, and express their views and concerns on how Board funds are

used if imports are assessed under the Plan. Importers would nominate

individuals to serve as importer members on the Board, and as required

for other members of the Board, two nominees would be submitted to the

Secretary for each vacancy. The Act requires the number of importers

members to be proportionate to the assessments paid by importers.

However, it is necessary to calculate the number of initial importer

members on the volume of imports because imports are not currently

being assessed. There are currently 14 producers and 14 handlers on the

Board. This is the equivalent of one domestic industry member for every

67.7 million pounds of domestic production. Based on the average annual

volume of imports during the last 3-year period (323.1 hundredweight),

four importers would be added to the current Board. In order to make

this change, this rule would amend Secs. 1210.202, 1210.203, 1210.320,

1210.321, and 1210.401.

The Act provides for the elimination of refunds of assessments if

the producers, handlers, and importers vote to eliminate refunds. The

refund provision has been in effect since the beginning of the program.

Refunds have been increasing every year from 9 percent in 1990 to

almost 29 percent in 1993. If the refund provision is eliminated, it

would provide the Board with an estimated additional $250,000 per year

for research and promotion activities. In order to make this change,

this rule would amend Secs. 1210.343 and 1210.520.

If the refund provision remains in the Plan, and importers are

subject to the Plan, then importers would be entitled to a refund of

all assessments paid on watermelons imported into the United States.

The Act increases the acreage for exempt producers from ``less than

5 acres'' to ``less than 10 acres'' of watermelons. Importers of less

than 150,000 pounds of watermelons per year would be entitled to apply

for a refund which would be the producer equivalent of the import

assessments. The 150,000-pound exemption level for importers is the

level determined to be equivalent to 10 acres of watermelons for

domestic producers. In addition, the Act provides that the Board has

the authority to establish rules for producers to certify whether they

are exempt from the assessments. In order to make these changes, this

rule would amend Secs. 1210.201, 1210.341, 1210.342, 1210.518, and

1210.521.

The Act also increases applicability of the law from the 48

contiguous States to the 50 States and the District of Columbia. This

amendment would expand the Plan to cover producers, handlers, and

importers in Hawaii, Alaska, and the District of Columbia. In order to

make these changes, this rule would amend Secs. 1210.201 and 1210.305

and would add a new Sec. 1210.315.

Section 1647(f) of the Act permits changes in the assessment rate

through notice and comment rulemaking. No change to the Plan would be

necessary to implement this amendment to the Act because Sec. 1210.341

of the Plan states that assessment rates shall be fixed by the

Secretary in accordance with section 1647(f) of the Act.

The Act provides that a producer is eligible to serve on the Board

as a representative of handlers (1) if a producer purchases watermelons

from other producers in a combined total volume that is equal to 25

percent or more of the producer's own production or (2) if the combined

total volume of watermelons handled by the producer from the producer's

own production and purchases from other producer's production is more

than 50 percent of the producer's own production. This provision

facilitates the eligibility of producers and handlers to serve on the

Board as representatives of their specific group. In order to make

these changes, this rule would amend Secs. 1210.202, 1210.321,

1210.363, 1210.368, and 1210.402.

The Act also provides that all future referenda do not have to be

conducted at Extension Service county offices. This procedure proved to

be expensive and difficult to administer. The Act would now allow

referenda to be conducted by mail ballot which would reduce the costs

involved in conducting referenda and facilitate a more timely

tabulation of the results. In order to make this change, this rule

would amend Secs. 1210.203, 1210.204, and 1210.363.

In addition, the Act changes the criteria for determining the

outcome of referenda. The Act previously provided that the Plan should

not be effective unless approved by not less than two-thirds of the

producers and handlers voting in the referendum, or producers and

handlers of not less than two-thirds of the watermelons produced and

handled during the representative period by producers and handlers

voting in the referendum, and by not less than a majority of the

producers and a majority of the handlers voting in the referendum. The

Act now specifies that the determination of the results of a referendum

should be on the basis of a simple majority of the producers, handlers,

and, if covered by the Plan, importers voting in the referendum. In

order to make this change, this rule would amend Sec. 1210.363.

Furthermore, Sec. 1210.252 would be revised to correct a wording

error made during the promulgation of the Plan and Sec. 1210.322 would

be revised to delete obsolete language.

In addition, Sec. 1210.325 would be changed to reflect a change in

the number of Board members that constitute a majority. This revision

would reflect the addition of importer members to the Board.

Section 1210.505 would be amended to reflect the fact that the

Department issues user fee bills to the Board monthly rather than

quarterly.

In addition, miscellaneous conforming changes would be made to

Secs. 1210.201, 1210.251, 1210.302, 1210.328, 1210.340, and 1210.362.

Interested persons are encouraged to comment on the proposed

amendments included in this rule. All written comments received by the

date specified herein will be considered.

After all comments have been reviewed and any necessary changes

made to these proposed amendments to the Plan, the proposals will be

published together with a referendum order. The referendum order will

set the dates for eligible producers, handlers, and importers to vote

on whether or not they favor (1) eliminating the provisions for

assessment refunds and (2) implementing assessments on imported

watermelons and adding importer members to the Board.

List of Subjects in 7 CFR Part 1210

Agricultural promotion, Agricultural research, Market development,

Reporting and recordkeeping requirements, Watermelons.

For the reasons set forth in the preamble, part 1210, Chapter XI of

title 7 is proposed to be amended as follows:

PART 1210--WATERMELON RESEARCH AND PROMOTION PLAN

1. The authority citation for 7 CFR part 1210 continues to read as

follows:

Authority: 7 U.S.C. 4901-4916.

Subpart--Procedure for the Conduct of Referenda in Connection with

the Watermelon Research and Promotion Plan

2. Section 1210.200 is revised to read as follows:

Sec. 1210.200 General.

Referenda to determine whether producers, handlers, and importers

favor issuance, suspension or termination of a Watermelon Research and

Promotion Plan shall be conducted in accordance with this subpart.

3. Section 1210.201 is amended in paragraph (a) to add at the end

of the paragraph ``, as amended.''; in paragraph (g) by removing the

phrase ``and handling'' and adding in its place ``, handling, and

importing''; in paragraph (h) introductory text by removing the phrase

``five'' and adding in its place ``10''; and adding new paragraphs (j)

and (k) to read as follows:

Sec. 1210.201 Definitions.

* * * * *

(j) Importer means any person who imports watermelons into the

United States as principal or as an agent, broker, or consignee for any

person who produces watermelons outside the United States for sale in

the United States.

(k) United States means each of the several States and the District

of Columbia.

4. Section 1210.202 is revised to read as follows:

Sec. 1210.202 Voting.

(a) Each person who is a producer, handler, or importer as defined

in this subpart, at the time of the referendum and who also was a

producer, handler, or importer during the representative period, shall

be entitled to only one vote in the Referendum: Provided, That each

producer in a landlord-tenant relationship or a divided ownership

arrangement involving totally independent entities cooperating only to

produce watermelons in which more than one of the parties is a

producer, shall be entitled to one vote in the referendum covering only

that producer's share of the ownership; Provided further, That the vote

of a person who both produces and handles watermelons will be counted

as a handler vote if the producer purchased watermelons from other

producers, in a combined total volume that is equal to 25 percent or

more of the producer's own production; or the combined total volume of

watermelon handled by the producer from the producer's own production

and purchases from other producer's production is more than 50 percent

of the producer's own production; Provided further, That the vote of a

person who both imports and handles watermelons will be counted as an

importer vote if that person imports 50 percent or more of the combined

total volume of watermelons handled and imported by that person.

(b) Proxy voting is not authorized, but an officer or employee of a

corporate producer, handler, or importer, or an administrator, executor

or trustee of a producing, handling, or importing entity may cast a

ballot on behalf of such entity. Any individual so voting in a

referendum shall certify that individual is an officer or employee of

the producer, handler, or importer, or an administrator, executor, or

trustee of a producing, handling, or importing entity and that

individual has the authority to take such action. Upon request of the

referendum agent, the individual shall submit adequate evidence of such

authority.

(c) Each producer, handler, or importer shall be entitled to cast

only one ballot in the referendum.

5. Section 1210.203 is amended by revising paragraphs (b), (d)(2),

and (d)(3) and adding a new paragraph (d)(4) to read as follows:

Sec. 1210.203 Instructions.

* * * * *

(b) Determine procedures for casting ballots.

* * * * *

(d) * * *

(2) The acreage and volume in pounds of watermelons produced by the

voting producer during the representative period;

(3) The volume in pounds of watermelons handled by the voting

handler during the representative period; and

(4) The volume in pounds of watermelons imported by the voting

importer during the representative period.

* * * * *

6. Section 1210.204 is amended by revising the section heading and

paragraph (a)(1); removing paragraph (b); redesignating paragraph (c)

as paragraph (b); removing in new paragraph (b) the phrase ``and

handlers'' and adding in its place ``, handlers, and importers'';

adding new paragraph (c), and revising paragraphs (d) and (e) to read

as follows:

Sec. 1210.204 Agent.

* * * * *

(a) * * *

(1) Utilizing, without advertising expense, available media or

public information sources (including, but not limited to, press and

radio facilities serving the production area) to announce the dates of

the referendum as well as the methods of voting, the eligibility

requirements for voting, and other pertinent information regarding the

referendum.

* * * * *

(c) Preside at a meeting where ballots are to be cast.

(d) Distribute ballots and the aforesaid texts to producers,

handlers, and importers and receive any ballots which are cast.

(e) Record the name and address of each person receiving a ballot

from, or casting a ballot with, said agent and inquire into the

eligibility of such person to vote in the referendum.

Subpart--Rules of Practice Governing Proceedings on Petitions To

Modify or To Be Exempted From Plans

Sec. 1210.25 [Amended]

7. In Sec. 1210.251, paragraph (a) is amended by removing ``;'' and

adding in its place ``, as amended;''.

Sec. 1210.252 [Amended]

8. In Sec. 1210.252, paragraph (b)(3) is amended by removing the

word ``order'' and adding in its place ``Plan''.

Subpart--Watermelon Research and Promotion Plan

Sec. 1210.302 [Amended]

9. Section 1210.302 is amended by adding ``, as amended'' at the

end of the sentence.

10. Section 1210.305 is revised to read as follows:

Sec. 1210.305 Watermelon.

Watermelon means all varieties of the Family Curcubitaceae; Genus

and Species; Citrullus Lanatus, popularly referred to as watermelon

grown by producers in the United States or imported into the United

States.

Sec. 1210.306 [Amended]

11. Section 1210.306 is amended by removing the word ``five'' and

adding in its place ``10''.

12. A new section 1210.314 is added to read as follows:

Sec. 1210.314 Importer.

Importer means any person who imports watermelons into the United

States as a principal or as an agent, broker, or consignee for any

person who produces watermelons outside of the United States for sale

in the United States.

13. A new section 1210.315 is added to read as follows:

Sec. 1210.315 United States.

United States means each of the several States and the District of

Columbia.

14. Section 1210.320 is amended by revising paragraph (a) and

adding new paragraphs (d), (e), and (f) to read as follows:

Sec. 1210.320 Establishment and membership.

(a) There is hereby established a National Watermelon Promotion

Board, hereinafter called the ``Board.'' The Board shall be composed of

producers, handlers, importers, and one public representative appointed

by the Secretary. An equal number of producer and handler

representatives shall be nominated by producers and handlers pursuant

to Sec. 1210.321. The Board shall also include one or more

representatives of importers, who shall be nominated in such manner as

may be prescribed by the Secretary. The public representative shall be

nominated by the Board members in such manner as may be prescribed by

the Secretary. If producers, handlers, and importers fail to select

nominees for appointment to the Board, the Secretary may appoint

persons on the basis of representation as provided in Sec. 1210.324.

* * * * *

(d) Importer representation on the Board shall be proportionate to

the percentage of assessments paid by importers to the Board, except

that at least one representative of importers shall serve on the Board.

(e) Not later than 5 years after the date that importers are

subject to the Plan, and every 5 years thereafter, the Secretary shall

evaluate the average annual percentage of assessments paid by importers

during the 3-year period preceding the date of the evaluation and

adjust, to the extent practicable, the number of importer

representatives on the Board.

(f) The Board consists of 14 producers, 14 handlers, at least one

importer, and one public member appointed by the Secretary.

15. Section 1210.321 is amended by redesignating paragraphs (a),

(b), and (c) as (b), (c), and (e) respectively; redesignating paragraph

(d) as paragraph (f); removing new paragraph (f)(1) and redesignating

new paragraphs (f)(2) and (f)(3) as paragraphs (f)(1) and (f)(2);

revising new paragraphs (b) introductory text, (b)(1), (b)(4), (e), (f)

introductory text, and (f)(1); removing in new paragraph (c) the word

``positions'' and adding in its place the phrase ``producer and handler

positions''; and adding new paragraphs (a) and (d) to read as follows:

Sec. 1210.321 Nominations and selection.

* * * * *

(a) There shall be two individuals nominated for each vacant

position.

(b) The Board shall issue a call for nominations by February first

of each year in which an election is to be held. The call shall include

at a minimum, the following information:

(1) A list of the vacancies and qualifications as to producers and

handlers by district and to importers nationally for which nominees may

be submitted.

* * * * *

(4) The date, time, and location of any next scheduled meeting of

the Board, national and State producer or handler associations,

importers, and district conventions, if any.

* * * * *

(d) Nominations for importers positions that become vacant may be

made by mail ballot, nomination conventions, or by other means

prescribed by the Secretary. The Board shall provide notice of such

vacancies and the nomination process to all importers through press

releases and any other available means as well as direct mailing to

known importers. All importers may participate in the nomination

process: Provided, That a person who both imports and handles

watermelons may vote for importer members and serve as an importer

member if that person imports 50 percent or more of the combined total

volume of watermelons handled and imported by that person.

(e) All producers and handlers within the district may participate

in the convention: Provided, That a person that produces and handles

watermelons may vote for handler members only if the producer purchased

watermelons from other producers, in a combined total volume that is

equal to 25 percent or more of the producer's own production; or the

combined total volume of watermelon handled by the producer from the

producer's own production and purchases from other producer's

production is more than 50 percent of the producer's own production;

and provided further, That if a producer or handler is engaged in the

production or handling of watermelons in more than one State or

district, the producer or handler shall participate within the State or

district in which the producer or handler so elects in writing to the

Board and such election shall remain controlling until revoked in

writing to the Board.

(f) The district convention chairperson shall conduct the selection

process for the nominees in accordance with procedures to be adopted at

each such convention, subject to requirements set in section

1210.321(e).

(1) No State in Districts 3, 4, 5, and 7 as currently constituted

shall have more than three producers and handlers representatives

concurrently on the Board.

* * * * *

16. Section 1210.322 is amended by revising paragraphs (a), (b),

and (d) to read as follows:

Sec. 1210.322 Term of office.

(a) The term of office of Board members shall be three years.

(b) Except in the case of mid-term vacancies, the term of office

shall begin on January 1, or such other date as may be recommended by

the Board and approved by the Secretary.

* * * * *

(d) No person shall serve more than two successive terms of office.

17. Section 1210.325 is amended by revising paragraph (a) to read

as follows:

Sec. 1210.325 Procedure.

(a) A simple majority of Board members shall constitute a quorum

and any action of the Board shall require the concurring votes of a

majority of those present and voting. At assembled meetings all votes

shall be cast in person.

* * * * *

Sec. 1210.328 [Amended]

18. Section 1210.328 is amended by removing in paragraphs (d) and

(g) the word ``collected'' and adding in its place ``received'';

removing in paragraphs (g), (i), and (m) the phrase ``and handlers''

and adding in its place ``, handlers, and importers''; removing in

paragraph (k) the phrase ``or handler'' and adding in its place ``,

handler or importer''; and removing in paragraph (n) the word

``handlers'' and adding in its place ``handlers, importers,''.

Sec. 1210.340 [Amended]

19. Section 1210.340 is amended by removing in paragraph (b) the

word ``collected'' and adding in its place ``received''.

20. Section 1210.341 is amended by revising paragraphs (a), and

(b); redesignating paragraphs (d) through (i) as (e) through (j);

revising redesignated paragraph (e); adding a new paragraph (d);

removing in redesignated paragraphs (f) and (g) the word ``handler''

and adding in its place ``handler or importer''; removing in paragraph

(h) the word ``handlers'' and adding in its place ``handlers and

importers''; and removing in paragraph (f) the letter ``(d)'' and

adding in its place ``(e)'' to read as follows:

Sec. 1210.341 Assessments.

(a) During the effective period of this subpart, assessments shall

be levied on all watermelons produced and first handled in the United

States and all watermelons imported into the United States for

consumption as human food. No more than one assessment on a producer,

handler, or importer shall be made on any lot of watermelons. The

handler shall be assessed an equal amount on a per unit basis as the

producer. If a person performs both producing and handling functions on

any same lot of watermelons, both assessments shall be paid by such

person. In the case of an importer, the assessment shall be equal to

the combined rate for domestic producers and handlers and shall be paid

by the importer at the time of entry of the watermelons into the United

States.

(b) Assessment rates shall be fixed by the Secretary in accordance

with section 1647(f) of the Act. No assessments shall be levied on

watermelons grown by producers of less than 10 acres of watermelons.

* * * * *

(d) Each importer shall be responsible for payment of the

assessment to the Board on watermelons imported into the United States

through the U.S. Customs Service or in such other manner as may be

established by rules and regulations approved by the Secretary.

(e) Producer-handlers and handlers shall pay assessments to the

Board at such time and in such manner as the Board, with the

Secretary's approval, directs, pursuant to regulations issued under

this part. Such regulations may provide for different handlers or

classes of handlers and different handler payment and reporting

schedules to recognize differences in marketing practices or procedures

used in any State or production area.

* * * * *

21. Section 1210.342 is amended by designating the existing text as

paragraph (a) and adding new paragraphs (b), (c), and (d) to read as

follows:

Sec. 1210.342 Exemption from assessment.

* * * * *

(b) Importers of less than 150,000 pounds of watermelons per year

shall be entitled to apply for a refund that is equal to the rate of

assessment paid by domestic producers.

(c) The Secretary may adjust the quantity of the weight exemption

specified in paragraph (b) of this section on the recommendation of the

Board after an opportunity for public notice and comment to reflect

significant changes in the 5-year average yield per acre of watermelons

produced in the United States.

(d) The Board shall have the authority to establish rules, with the

approval of the Secretary, for certifying whether a person meets the

definition of a producer under Sec. 1210.306.

Sec. 1210.343 [Removed and Reserved]

22. Section 1210.343 is removed and reserved.

23. Section 1210.350 is amended by redesignating paragraphs (a)

through (d) as (1) through (4); designating the introductory paragraph

as paragraph (a); and adding new paragraphs (b) and (c) to read as

follows:

Sec. 1210.350 Reports.

* * * * *

(b) Each importer of watermelons shall maintain a separate record

that includes a record of:

(1) The total quantity of watermelons imported into the United

States that are included under the terms of this Plan;

(2) The total quantity of watermelons that are exempt from the

Plan; and

(3) Such other information as may be prescribed by the Board.

(c) Each importer shall report to the Board at such times and in

such manner as it may prescribe such information as may be necessary

for the Board to perform its duties under this part.

Sec. 1210.351 [Amended]

24. Section 1210.351 is amended by removing the word ``handler''

and adding in its place ``handler and importer'' and removing the word

``two'' and adding in its place ``2''.

Sec. 1210.352 [Amended]

25. Section 1210.352 is amended by removing in paragraph (a)(1) the

word ``handlers'' and adding in its place ``handlers or importers''.

Sec. 1210.362 [Amended]

26. Section 1210.362 is amended by removing the word ``collected''

and adding in its place ``received''; and removing the word ``plan''

and adding in its place ``Plan''.

27. Section 1210.363 is amended by revising paragraph (b) to read

as follows:

Sec. 1210.363 Suspension or termination.

* * * * *

(b) The Secretary may conduct a referendum at any time and shall

hold a referendum on request of the Board or at least 10 percent of the

combined total of the watermelon producers, handlers, and importers to

determine if watermelon producers, handlers, and importers favor

termination or suspension of this Plan. The Secretary shall suspend or

terminate this Plan at the end of the marketing year whenever the

Secretary determines that the suspension or termination is favored by a

majority of the watermelon producers, handlers, and importers voting in

such referendum who, during a representative period determined by the

Secretary, have been engaged in the production, handling, or importing

of watermelons and who produced, handled, or imported more than 50

percent of the combined total of the volume of watermelons produced,

handled, or imported by those producers, handlers, and importers voting

in the referendum. For purposes of this section, the vote of a person

who both produces and handles watermelons will be counted as a handler

vote if the producer purchased watermelons from other producers, in a

combined total volume that is equal to 25 percent or more of the

producer's own production; or the combined total volume of watermelon

handled by the producer from the producer's own production and

purchases from other producer's production is more than 50 percent of

the producer's own production. Provided, That the vote of a person who

both imports and handles watermelons will be counted as an importer

vote if that person imports 50 percent or more of the combined total

volume of watermelons handled and imported by that person. Any such

referendum shall be conducted by mail ballot.

Sec. 1210.364 [Amended]

28. Section 1210.364 is amended by removing in paragraph (d) the

phrase ``and handlers'' and adding in its place ``, handlers and

importers''.

29. The subpart heading ``Subpart--Procedures for Nominating

Producer and Handler Members to the National Watermelon Promotion

Board'' is revised; and a new undesignated center heading is added

after the subpart heading to read as follows:

Subpart--Procedures for Nominating Members to the National

Watermelon Promotion Board

Producer and Handler Members

30. In Section 1210.401, paragraph (b) is revised to read as

follows:

Sec. 1210.401 District conventions.

* * * * *

(b) District conventions are to be held to nominate producers and

handlers as candidates for membership on the National Watermelon

Promotion Board. Each district is entitled to two producer and two

handler members on the Board.

* * * * *

31. Section 1210.402 is amended by revising paragraph (a); removing

in paragraph (b) the phrase ``or first handling'' and adding in its

place ``, first handling or importing''; and removing in paragraph (b)

the phrase ``Sec. 1210.403'' and adding in its place ``Sec. 1210.403

and Sec. 1210.404'' to read as follows:

Sec. 1210.402 Voter and board member nominee eligibility.

(a) All producers and handlers within a district may participate in

their district convention for the purpose of nominating candidates for

appointment to the Board: Provided, That a producer who both produces

and handles watermelons may vote for handler member nominees and serve

as a handler member nominee only if the producer purchased watermelons

from other producers, in a combined total volume that is equal to 25

percent or more of the producer's own production or the combined total

volume of watermelons handled by the producer from the producer's own

production and purchases from other producer's production is more than

50 percent of the producer's own production; and Provided further, That

if a producer or handler is engaged in the production or handling of

watermelons in more than one State or district, the producer or handler

shall participate within the State or district in which the producer or

handler so elects in writing to the Board and such election shall

remain controlling until revoked in writing to the Board. For the

purpose of participation in initial nominating conventions, such

election shall be made in writing, at the address provided, to the

Department official identified in the call for a district convention.

* * * * *

32. A new undesignated center heading and Section 1210.404 are

added to read as follows:

Importer Members

Sec. 1210.404 Importer member nomination and selection.

(a) The Board shall include one or more representatives of

importers, who shall be appointed by the Secretary from nominations

submitted by watermelon importers. Importers' representation on the

Board shall be proportionate to the percentage of assessments paid by

importers to the Board, except that at least one representative of

importers shall serve on the Board if importers are subject to the

Plan. Nominations for importer positions that become vacant shall be

made by importers at nomination conventions or by mail ballot.

(b) The initial nomination of importer members shall be made not

later than 90 days after the Plan is amended.

(c) There shall be two individuals nominated for each vacant

position. The importer receiving the highest number of votes for a

vacancy shall be the first choice nominee, and the importer receiving

the second highest number of votes shall be the second choice nominee

submitted to the Secretary.

(d) Any individual, group of individuals, partnership, corporation,

association, cooperative or any other entity which is engaged in the

production, first handling or importing of watermelons is considered a

person and as such is entitled to only one vote, except that such

person may cast proxy votes as provided in section 1210.404(e)(1) of

this subpart.

(e) Nomination Conventions. If nominations are made by nomination

conventions, the Board shall widely publicize such conventions and

provide importers and the Secretary at least 10 days notice prior to

each convention.

(1) Proxy voting by importers shall be permitted at all

conventions. Any person wanting to cast proxy votes must demonstrate

authorization to do so. Authority to cast a proxy vote on behalf of

another person shall be demonstrated through documentation containing:

(i) The proxy voter's name, address, and telephone number;

(ii) Signature and date signed;

(iii) A certification identifying the proxy voter as an importer;

and

(iv) A statement identifying the person being given authority by

the proxy voter to cast the proxy vote.

(2) The Board shall provide to the Secretary a typed copy of each

convention's minutes and shall arrange for completion of qualification

statements and other specified information by each nominee and forward

such to the Secretary within 14 calendar days of completion of a

convention.

(f) Mail balloting. If nominations are conducted by mail ballot,

the Board shall request importers to submit nominations of eligible

importers. It is the importer's responsibility to prove the

individual's eligibility. After the names of nominees are received, the

Board shall print ballots and ask eligible importers to vote to

nominate their candidates. After the vote is received, the Board shall

tabulate the results and shall send to the Department the nominees in

order of preference. The Board shall provide the Secretary with a

report on the results, number of importers participating in the vote,

and the volume of imports, and shall arrange for completion of

qualification statements and other specified information by each

nominee and forward such to the Secretary within 14 calendar days of

receiving the ballots.

(g) Any individual who both imports and handles watermelons will be

considered an importer if that person imports 50 percent or more of the

combined total volume of watermelons handled and imported by that

person.

33. Section 1210.503 is redesignated as Sec. 1210.405, paragraph

(a) is revised, and new undesignated center heading is added to read as

follows:

Public Member

Sec. 1210.405 Public member nominations and selection.

(a) The public member shall be nominated by the other members of

the Board. * * *

* * * * *

Subpart--Rules and Regulations

Sec. 1210.505 [Amended]

34. Section 1210.505 is amended by removing the word ``quarterly''

and adding in its place ``monthly''.

35. Section 1210.515 is amended by revising paragraph (a);

redesignating paragraph (b) as (c); and adding a new paragraph (b) to

read as follows:

Sec. 1210.515 Levy of assessments.

(a) An assessment of two cents per hundredweight shall be levied on

all watermelons produced for ultimate consumption as human food, and an

assessment of two cents per hundredweight shall be levied on all

watermelons first handled for ultimate consumption as human food. An

assessment of four cents per hundredweight shall be levied on all

watermelons imported into the United States for ultimate consumption as

human food at the time of entry in the United States.

(b) The import assessment shall be uniformly applied to imported

watermelons that are identified by the numbers 0807.10.30007 and

0807.10.40005 in the Harmonized Tariff Schedule of the United States or

any other number used to identify fresh watermelons for consumption as

human food.

* * * * *

36. Section 1210.518 is amended by revising paragraphs (a) and (b);

removing in paragraph (c)(1) the letter ``(e)'' and adding in its place

``(b) and (e)'' and removing the word ``handler'' and adding in its

place ``handler and importer''; removing in paragraph (c)(2)(viii) the

word ``five'' and adding in its place ``10''; and removing in paragraph

(d)(1) the word ``handler'' and adding in its place ``handler and

importer'' to read as follows:

Sec. 1210.518 Payment of assessments.

(a) Time of payment. The assessment on domestically produced

watermelons shall become due at the time the first handler handles the

watermelons for non-exempt purposes. The assessment on imported

watermelons shall become due at the time of entry, or withdrawal, into

the United States.

(b) Responsibility for payment.

(1) The first handler is responsible for payment of both the

producer's and the handler's assessment. The handler may collect the

producer's assessment from the producer or deduct such producer's

assessment from the proceeds paid to the producer on whose watermelons

the producer assessment is made. Any such collection or deduction of

producer assessment shall be made not later than the time when the

first handler handles the watermelons.

(2) The U.S. Customs Service shall collect assessments on imported

watermelons from importers and forward such assessments under an

agreement between the U.S. Customs Service and the U.S. Department of

Agriculture. Importers shall be responsible for payment of assessments

directly to the Board of any assessments due but not collected by the

U.S Customs Service at the time of entry, or withdrawal, on watermelons

imported into the United States for human consumption.

* * * * *

Sec. 1210.519 [Amended]

37. Section 1210.519 is amended by removing in the introductory

paragraph the word ``handler'' and adding in its place ``handler and

importer''; by removing in paragraph (a) the word ``handler's'' and

adding in its place ``handler's and importer's''; and removing the word

``Watermelon'' from the introductory paragraph and paragraphs (a) and

(b).

38. Section 1210.520 is revised to read as follows:

Sec. 1210.520 Refunds.

Each importer of less than 150,000 pounds of watermelons during any

calendar year shall be entitled to apply for a refund of the

assessments paid in an amount equal to the amount paid by domestic

producers.

(a) Application form. The Board shall make available to all

importers a refund application form.

(b) Submission of refund application to the Board. The refund

application form shall be submitted to the Board within 90 days of the

last day of the year the watermelons were actually imported. The refund

application form shall contain the following information:

(1) Importer's name and address;

(2) Number of hundredweight of watermelon on which refund is

requested;

(3) Total amount to be refunded;

(4) Proof of payment as described below; and

(5) Importer's signature.

(c) Proof of payment of assessment. Evidence of payment of

assessments satisfactory to the Board shall accompany the importer's

refund application. An importer must submit a copy of the importer's

report or a cancelled check. Evidence submitted with a refund

application shall not be returned to the applicant.

(d) Payment of refund. Immediately after receiving the properly

executed application for refund, the Board shall make remittance to the

applicant.

39. Section 1210.521 is revised to read as follows:

Sec. 1210.521 Reports of disposition of exempted watermelons.

The Board may require reports by handlers or importers on the

handling/importing and disposition of exempted watermelons and/or on

the handling of watermelons for persons engaged in growing less than 10

acres of watermelons or in the case of importers, the importing of less

than 150,000 pounds per year. Authorized employees of the Board or the

Secretary may inspect such books and records as are appropriate and

necessary to verify the reports on such disposition.

Sec. 1210.530 [Amended]

40. Section 1210.530 is amended by removing the word ``handler''

from the introductory text and adding in its place ``handler and

importer''.

Sec. 1210.531 [Amended]

41. Section 1210.531 is amended by removing the word ``handler''

and adding in its place ``handler and importer''.

42. Section 1210.532 is revised to read as follows:

Sec. 1210.532 Confidential books, records, and reports.

All information obtained from the books, records, and reports of

handlers and importers and all information with respect to refunds of

assessments made to importers shall be kept confidential in the manner

and to the extent provided for in Sec. 1210.352.

Dated: April 6, 1994.

Lon Hatamiya,

Administrator.

[FR Doc. 94-8857 Filed 4-13-94; 8:45 am]

BILLING CODE 3410-02-P