Expenses and Assessment Rate for Marketing Order Covering Kiwifruit Grown in California

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 920

[Docket No. FV95-920-2FIR]

Expenses and Assessment Rate for Marketing Order Covering

Kiwifruit Grown in California

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Department of Agriculture (Department) is adopting as a

final rule, without change, the provisions of an interim final rule

authorizing expenditures and establishing an assessment rate under

Marketing Order No. 920 for the 1995-96 fiscal year. Authorization of

this budget enables the Kiwifruit Administrative Committee (Committee)

to incur expenses that are reasonable and necessary to administer the

program. Funds to administer this program are derived from assessments

on handlers.

DATES: Effective beginning August 1, 1995, through July 31, 1996.

FOR FURTHER INFORMATION CONTACT: Rose M. Aguayo, Marketing Specialist,

California Marketing Field Office, Fruit and Vegetable Division, AMS,

USDA, 2202 Monterey Street, suite 102B, Fresno, California 93721,

telephone (209) 487-5901, Fax # (209) 487-5906; or Charles Rush,

Marketing Specialist, Marketing Order Administration Branch, F&V, AMS,

USDA, P.O. Box 96456, room 2522-S, Washington, DC 20090-6456; telephone

(202) 690-3670, Fax # (202) 720-5698.

SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing

Order No. 920 (7 CFR part 920), as amended, regulating the handling of

kiwifruit 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 (Department) is issuing this rule in

conformance with Executive Order 12866.

This final rule has been reviewed under Executive Order 12778,

Civil Justice Reform. Under the marketing order provisions now in

effect, California kiwifruit are subject to assessments. It is intended

that the assessment rate as issued herein will be applicable to all

assessable California kiwifruit during the 1995-96 fiscal year

beginning August 1, 1995, through July 31, 1996. 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 the Secretary 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 the Secretary 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 in equity to review the

Secretary's ruling on the petition, provided a bill in equity is filed

not later than 20 days after date of the entry of the ruling.

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. Marketing orders issued

pursuant to the Act, and 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 65 handlers of kiwifruit grown in

California who are subject to regulation under the kiwifruit marketing

order and approximately 600 producers of kiwifruit in the regulated

area. Small agricultural producers have been defined by the Small

Business Administration (13 CFR 121.601) as those having annual

receipts of less than $500,000, and small agricultural service firms

are defined as those whose annual receipts are less than $5,000,000.

The majority of kiwifruit producers and handlers may be classified as

small entities.

The kiwifruit marketing order, administered by the Department,

requires that the assessment rate for a particular fiscal year apply to

all assessable kiwifruit handled from the beginning of such year. The

budget of expenses for the 1995-96 fiscal year was prepared by the

Committee, the agency responsible for local administration of this

marketing order, and submitted to the Department for approval. The

members of the Committee are producers of California kiwifruit and one

non-industry member. They are familiar with the Committee's needs and

with the costs for goods, services, and personnel in their local area

and are thus in a position to formulate an appropriate budget. The

budget was formulated and discussed in public meetings. Thus, all

directly affected persons have an opportunity to participate and

provide input.

The assessment rate recommended by the Committee was derived by

dividing anticipated expenses by expected shipments of kiwifruit.

Because that rate is applied to actual shipments, it must be

established at a rate which will produce sufficient income to pay the

Committee's expected expenses. The recommended budget and rate of

assessment are usually acted upon by the Committee shortly before a

season starts, and expenses are incurred on a continuous basis.

Therefore, the budget and assessment rate approval must be expedited so

that the Committee will have funds to pay its expenses.

The Committee met on June 14, 1995, and unanimously recommended

1995-96 marketing order expenditures of $172,683 and an assessment rate

of 1.5 cents per tray or tray equivalent of

[[Page 52835]]

kiwifruit. In comparison, 1994-95 marketing year budgeted expenditures

were $169,157, which is $3,526 less than the $172,683 recommended for

this fiscal year. The assessment rate of 1.5 cents per tray or tray

equivalent is .5 cents more than last year's assessment rate of 1.0

cents. The major budget category for 1995-96 is $102,850 for

administrative, staff and field salaries.

Assessment income for 1995-96 is estimated to total $135,000 based

on anticipated fresh domestic shipments of 9 million trays or tray

equivalents of kiwifruit. The assessment income will have to be

augmented by $37,683 from the Committee's reserves to provide adequate

funds to cover budgeted expenses. Funds in the reserve at the end of

the 1995-96 fiscal year are estimated to be $40,245. These reserve

funds will be within the maximum permitted by the order of one fiscal

year's expenses.

An interim final rule regarding this action was published in the

July 13, 1995, issue of the Federal Register (60 FR 36032). That rule

provided for a 30-day comment period. No comments were received.

While this action will impose some additional costs on handlers,

the costs are in the form of uniform assessments on all handlers. Some

of the additional costs may be passed on to producers. However, these

costs will be offset by the benefits derived from the operation of the

marketing order. Therefore, the Administrator of the AMS has determined

that this action will not have a significant economic impact on a

substantial number of small entities.

After consideration of all relevant material presented, including

the Committee's recommendation, and other available information, it is

found that this final 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

Committee needs to have sufficient funds to pay its expenses which are

incurred on a continuous basis; (2) the 1995-96 fiscal year began on

August 1, 1995, and the marketing order requires that the rate of

assessment for the fiscal year apply to all assessable kiwifruit

handled during the fiscal year; (3) handlers are aware of this rule

which was recommended by the Committee at a public meeting; and (4) an

interim final rule was published on this action and provided for a 30-

day comment period; no comments were received.

List of Subjects in 7 CFR Part 920

Kiwifruit, Marketing agreements, Reporting and recordkeeping

requirements.

PART 920--KIWIFRUIT GROWN IN CALIFORNIA

Accordingly, the interim final rule amending 7 CFR part 920 which

was published at 60 FR 36032 on July 13, 1995, is adopted as a final

rule without change.

Dated: September 27, 1995.

Sharon Bomer Lauritsen,

Deputy Director, Fruit and Vegetable Division.

[FR Doc. 95-25131 Filed 10-10-95; 8:45 am]

BILLING CODE 3410-02-P