Kiwifruit Grown in California; Reduction of Reporting Requirements

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

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

reducing the reporting requirements for California kiwifruit handlers

who ship less than 10,000 trays or tray equivalents per fiscal year.

The changes in reporting requirements were unanimously recommended by

the Kiwifruit Administrative Committee (Committee), the agency

responsible for the local administration of the Federal marketing order

for kiwifruit grown in California. This final rule decreases the

reporting burden on such handlers while maintaining the information

collection necessary for the efficient operation of the program.

EFFECTIVE DATE: January 9, 1997.

FOR FURTHER INFORMATION CONTACT: Kurt J. Kimmel, California Marketing

Field Office, Marketing Order Administration Branch, F&V, AMS, USDA,

2202 Monterey Street, suite 102B, Fresno, California 93721; telephone:

(209) 487-5901, Fax # (209) 487-5906; or Charles L. Rush, Marketing

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

2522-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: (202)

720-5127, Fax # (202) 720-5698. Small businesses may request

information on compliance with this regulation by contacting: Jay

Guerber, Marketing Order Administration Branch, Fruit and Vegetable

Division, AMS, USDA, P.O. Box 96456, room 2523-S, Washington, DC 20090-

6456; telephone (202) 720-2491; 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.'' This 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 12988, Civil

Justice Reform. This rule is not intended to have retroactive effect.

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 to review the Secretary's

ruling on the petition, provided an action 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 Agricultural Marketing Service (AMS) has considered the

economic impact of this action 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 who are subject to

regulation under the marketing order and approximately 500 producers of

kiwifruit in the regulated area. Small agricultural service firms have

been defined by the Small Business Administration (13 CFR 121.601) as

those having annual receipts of less than $5,000,000, and small

agricultural producers are defined as those whose annual receipts are

less than $500,000. The majority of kiwifruit handlers and producers

may be classified as small entities.

This rule finalizes a reduction in the number of reports required

to be filed by small kiwifruit handlers (those who handle less than

10,000 tray equivalents per year). The decrease in the number of

reports required to be filed should not inhibit the effective operation

of the order. It is estimated that less than 100,000 tray equivalents

will be shipped by those eligible for the reduced reporting

requirement, or approximately one percent of California kiwifruit

production. A majority of these small volume handlers, eligible for the

reduced reporting requirement, sell fruit for two to five growers.

Generally, kiwifruit shipments are small and may consist of less than

50 trays at a time. Shipment information from these small volume

handlers will be added into the total shipments at the end of each

fiscal year. The lack of shipment information that will be provided by

these handlers on a monthly basis is insignificant. The Committee is

still able to levy assessments on those handlers eligible for the

reduced reporting requirement based on the information in the shipment

reports that is still required twice per season.

This rule directly benefits small kiwifruit handlers. It is

anticipated that approximately 20 of the 65 handlers are eligible for

the reduced reporting burden authorized by this rule. These handlers

will not be required to file biweekly inventory reports and will be

required to file shipment reports less frequently. It is estimated that

the reporting burden for each of these 20 handlers will decrease by an

average of 12 hours per year, for a total reduction of 240 hours.

[[Page 64960]]

The range of volume of kiwifruit handled by kiwifruit handlers is

extremely broad with some handlers handling as few as 50 tray

equivalents and others over 1 million tray equivalents. The majority of

handlers fall in the middle and on average ship between 100,000 and

800,000 tray equivalents.

Therefore, the AMS has determined that this action will not have a

significant economic impact on a substantial number of small entities.

An interim final rule was issued on September 27, 1996, and

published in the Federal Register (61 FR 51575, October 3, 1996), with

an effective date of October 4, 1996. That rule amended Sec. 920.160

(a) and (b), of the rules and regulations in effect under the order.

That rule provided a 30-day comment period which ended November 4,

1996. No comments were received.

Under the terms of the order, fresh market shipments of California

kiwifruit are required to be inspected and are subject to grade, size,

maturity, and pack and container requirements. In addition, the order

authorizes the Committee to collect information from kiwifruit handlers

in order to efficiently operate the program.

The Committee met on June 12, 1996, and unanimously recommended

reducing the reporting burden for handlers who ship less than 10,000

tray equivalents per season. Such handlers, if they qualified with the

Committee, will no longer be required to complete biweekly inventory

reports and will only be required to fill out a monthly shipment report

twice per year.

Section 920.60 of the order authorizes the Committee, subject to

the approval of the Secretary, to request information from handlers

necessary to perform its duties under the order. Prior to the effective

date of the interim final rule, section 920.160(a) of the order's rules

and regulations required a report of shipments to be filed with the

Committee by the fifth day of the month following such shipment, or

such other later time established by the Committee. This report is used

to compile statistical information on shipments and to calculate

assessments owed under the marketing order. Pursuant to Sec. 920.160(b)

each handler had to file a Kiwifruit Inventory Shipment System (KISS)

report on the fifth and twentieth day of each month. The information

collected in the KISS report is used to track inventories of California

kiwifruit and provide inventory statistics, in aggregate, to the

industry. Both of these reports are also required under the authority

of the California Kiwifruit Commission (State Commission), which

administers a State program.

Prior to the 1995-96 season, the State Commission determined that

the reporting burden of the KISS report and the shipment report was

disproportionately impacting small volume handlers. As a result, the

State Commission created an alternate reporting system, known as

``Reporting EZ.'' It allows handlers who ship less than 10,000 tray

equivalents per season to file the shipment report twice per season

instead of monthly and exempts handlers from filing the KISS report.

Similarly, this rule reduces the frequency that the shipment report

is filed and eliminates the filing of a KISS report for those handlers

that ship less than 10,000 trays or tray equivalents per fiscal year so

that the ``Reporting EZ'' program is authorized under both the State

program and the Federal order. Handlers shipping under 10,000 trays or

tray equivalents per season only have to fill out the shipment report

twice per year. The first report is due January 5 or such other later

time established by the Committee and includes information on fresh

shipments from the beginning of the fiscal year (August 1 through

December 31). The second shipment report is due the fifth day of the

month following each handler's last shipment for the season and

includes shipments from January 1 until the end of shipping season.

In order for a handler to qualify for the ``Reporting EZ'' program,

the Committee must make a determination prior to October 31 (near the

beginning of the shipping season). The information that the Committee

will use to determine whether a handler is qualified is available from

the State Commission. The State Commission already requires handlers to

submit information in order to determine whether a handler intends to

ship under 10,000 tray equivalents per year. Thus, the Committee does

not need to place any additional reporting burden on kiwifruit handlers

in order to determine handler eligibility for the ``Reporting EZ''

program. The State Commission and the Committee have a written

memorandum of understanding that provides for the sharing of

information while keeping proprietary information confidential. Once

the handler has qualified, the Committee will then notify handlers that

they are eligible for the ``Reporting EZ'' program.

The information collection requirements contained in the referenced

sections have been previously approved by the Office of Management and

Budget (OMB) under the provisions of the Paperwork Reduction Act (Pub.

L. 104-13) and have been assigned OMB number 0581-0149.

This final rule reduces the reporting burden on approximately 20

handlers of kiwifruit who have been spending approximately 240 hours

completing the shipment reports and the KISS reports.

After consideration of all relevant material presented, the

information and recommendation submitted by the Committee, and other

information, it is found that finalizing the interim final rule,

without change, as published in the Federal Register (61 51575, October

3, 1996) will tend to effectuate the declared policy of the Act.

List of Subjects in 7 CFR Part 920

Kiwifruit, Marketing agreements, Reporting and recordkeeping

requirements.

For the reasons set forth in the preamble, 7 CFR part 920 is

amended as follows:

PART 920--KIWIFRUIT GROWN IN CALIFORNIA

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

was published at 61 FR 51575 on October 3, 1996, is adopted as a final

rule without change.

Dated: December 4, 1996.

Robert C. Keeney,

Director, Fruit and Vegetable Division.

[FR Doc. 96-31350 Filed 12-9-96; 8:45 am]

BILLING CODE 3410-02-P