Hazelnuts Grown in Oregon and Washington; Assessment Rate

DEPARTMENT OF AGRICULTURE

7 CFR Part 982

[Docket No. FV96-982-1IFR]

Hazelnuts Grown in Oregon and Washington; Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This interim final rule establishes an assessment rate for the

Hazelnut Marketing Board (Board) under Marketing Order No. 982 for the

1996-97 and subsequent marketing years. The Board is responsible for

local administration of the marketing order which regulates the

handling of hazelnuts grown in Oregon and Washington. Authorization to

assess hazelnut handlers enables the Board to incur expenses that are

reasonable and necessary to administer the program.

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DATES: Effective July 1, 1996. Comments received by July 15, 1996, will

be considered prior to issuance of a final rule.

ADDRESSES: Interested persons are invited to submit written comments

concerning this rule. Comments must be sent in triplicate to the Docket

Clerk, Fruit and Vegetable Division, AMS, USDA, P.O. Box 96456, room

2523-S, Washington, DC 20090-6456, FAX 202-720-5698. 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.

FOR FURTHER INFORMATION CONTACT: Martha Sue Clark, Marketing Order

Administration Branch, Fruit and Vegetable Division, AMS, USDA, P.O.

Box 96456, room 2523-S, Washington, DC 20090-6456, telephone 202-720-

9918, FAX 202-720-5698, or Teresa L. Hutchinson, Northwest Marketing

Field Office, Fruit and Vegetable Division, AMS, USDA, Green-Wyatt

Federal Building, room 369, 1220 Southwest Third Avenue, Portland, OR

97204, telephone 503-326-2724, FAX 503-326-7440.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing

Agreement and Order No. 982, both as amended (7 CFR part 982; April 22,

1996, 61 FR 17556), regulating the handling of hazelnuts grown in

Oregon and Washington. 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 rule has been reviewed under Executive Order 12778, Civil

Justice Reform. Under the marketing order now in effect, Oregon-

Washington hazelnut handlers are subject to assessments. Funds to

administer the order are derived from such assessments. It is intended

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

assessable hazelnuts beginning July 1, 1996, and continuing until

amended, suspended, or terminated. This rule will not preempt any State

or local laws, regulations, or policies, unless they present an

irreconcilable conflict with this rule.

The Act provides that administrative proceedings must be exhausted

before parties may file suit in court. Under section 608c(15)(A) of the

Act, any handler subject to an order may file with 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. Such 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 to review the

Secretary's ruling on the petition, provided an action is filed not

later than 20 days after the date of the entry of the ruling.

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.

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 1,000 producers of Oregon and Washington

hazelnuts in the production area and approximately 25 handlers subject

to regulation under the marketing order. 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 Oregon and Washington

hazelnut producers and handlers may be classified as small entities.

The Oregon and Washington hazelnut marketing order provides

authority for the Board, with the approval of the Department, to

formulate an annual budget of expenses and collect assessments from

handlers to administer the program. The members of the Board are

producers and handlers of hazelnuts. They are familiar with the Board'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 recommended by a mail vote and

discussed reconfirmed in a public meeting. Thus, all directly affected

persons have an opportunity to participate and provide input.

The Board, in a mail vote, unanimously recommended 1996-97

expenditures of $558,974 and an assessment rate of $0.007 per pound of

hazelnuts. In comparison, last year's budgeted expenditures were

$483,685. The assessment rate of $0.007 is the same as last year's

established rate. Major expenditures recommended by the Board for the

1996-97 year include $50,020 for personal services (salaries), $5,640

for rent, $5,000 for auditing, $5,000 for compliance, $15,000 for a

crop survey, $275,000 for promotion, and $182,364 for the emergency

fund. Budgeted expenses for these items in 1995-96 were $50,735,

$5,650, $3,500, $5,000, $11,000, $250,000, and $140,000, respectively.

The Board will consider using emergency funds for authorized activities

when it is reasonably certain that its estimate of assessable hazelnuts

will be reached. It will not be able to make this determination until

December 1996, the month in which the hazelnut harvest and deliveries

to handlers usually are completed. Hence, any decision on whether or

not to undertake additional activities will not be made until December

1996, at the earliest.

The assessment rate recommended by the Board was derived by

dividing anticipated expenses by expected shipments of Oregon and

Washington hazelnuts. Hazelnut shipments for the year are estimated at

20,000,000 pounds which should provide $280,000 in assessment income.

Income derived from handler assessments, interest, and from the Nut

Growers Society in payment for services performed by the Board under an

agreement with the Society, along with funds from the Board's

authorized reserve, will be adequate to cover budgeted expenses. Funds

remaining in the reserve at the end of the 1996-97 marketing year

should be about $196,240. Funds in the reserve will be kept within the

maximum permitted by the order.

While this rule 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 by the operation of the

marketing order. Therefore, the AMS has determined that this rule will

not have a significant economic impact on a substantial number of small

entities.

The assessment rate established in this rule will continue in

effect indefinitely unless modified, suspended, or terminated by the

Secretary upon recommendation and information submitted by the Board or

other available information.

Although this assessment rate is effective for an indefinite

period, the

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Board will continue to conduct a mail vote prior to or during each

fiscal period to recommend a budget of expenses and consider

recommendations for modification of the assessment rate. Any mail votes

will be discussed and reconfirmed at a public meeting. The dates and

times of Board meetings are available from the Board or the Department.

Board meetings are open to the public and interested persons may

express their views at these meetings. The Department will evaluate

Board recommendations and other available information to determine

whether modification of the assessment rate is needed. Further

rulemaking will be undertaken as necessary. The Board's 1996-97 budget

and those for subsequent fiscal periods will be reviewed and, as

appropriate, approved by the Department.

After consideration of all relevant material presented, including

the information and recommendation submitted by the Board and other

available information, it is hereby found that this rule, as

hereinafter set forth, will tend to effectuate the declared policy of

the Act.

Pursuant to 5 U.S.C. 553, it is also found and determined upon good

cause that it is impracticable, unnecessary, and contrary to the public

interest to give preliminary notice prior to putting this rule into

effect and that good cause exists for not postponing the effective date

of this action until 30 days after publication in the Federal Register

because: (1) The Board needs to have sufficient funds to pay its

expenses which are incurred on a continuous basis; (2) the 1996-97

marketing year begins on July 1, 1996, and the marketing order requires

that the rate of assessment for each marketing year apply to all

assessable hazelnuts handled during such marketing year; (3) handlers

are aware of this action which was unanimously recommended by the Board

in a mail vote and is similar to the assessment rate action issued last

year; and (4) this interim final rule provides a 30-day comment period,

and all comments timely received will be considered prior to

finalization of this rule.

List of Subjects in 7 CFR Part 982

Filberts, Hazelnuts, Marketing agreements, Nuts, Reporting and

recordkeeping requirements.

For the reasons set forth in the preamble, 7 CFR part 982 is

amended as follows:

PART 982--HAZELNUTS GROWN IN OREGON AND WASHINGTON

1. The authority citation for 7 CFR part 982 continues to read as

follows:

Authority: 7 U.S.C. 601-674.

2. A new subpart--Assessment Rates and a new Sec. 982.340 are added

to read as follows:

Subpart--Assessment Rates

Sec. 982.340 Assessment rate.

On and after July 1, 1996, an assessment rate of $0.007 per pound

of assessable hazelnuts is established for Oregon and Washington

hazelnuts.

Dated: June 7, 1996.

Robert C. Keeney,

Director, Fruit and Vegetable Division.

[FR Doc. 96-14985 Filed 6-12-96; 8:45 am]

BILLING CODE 3410-02-P