Reduced Assessment Rates for Specified Marketing Orders

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 922, 923, and 924

[Docket No. FV97-922-2 IFR]

Reduced Assessment Rates for Specified Marketing Orders

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This interim final rule decreases the assessment rates

established under Marketing Order Nos. 922, 923, and 924 for the 1997-

98, and subsequent fiscal periods. The Washington Apricot Marketing

Committee, Washington Cherry Marketing Committee, and Washington-Oregon

Fresh Prune Committee (Committees) are responsible for local

administration of the marketing orders which regulate the handling of

apricots and cherries grown in designated counties in Washington, and

prunes grown in designated counties in Washington and in Umatilla

County, Oregon. Authorization to assess apricot, cherry, and prune

handlers enables the Committees to incur expenses that are reasonable

and necessary to administer the programs. The 1997-98 fiscal periods

for these marketing orders cover the period April 1 through March 31.

The assessment rates will continue in effect indefinitely until

amended, suspended, or terminated.

DATES: Effective on August 5, 1997. Comments received by September 3,

1997, 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, Room 2525-S, P.O. Box

96456, 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: Teresa L. Hutchinson, Northwest

Marketing Field Office, Fruit and Vegetable Division, AMS, USDA, 1220

SW Third Avenue, Room 369, Portland, OR 97204; telephone: (503) 326-

2724, Fax: (503) 326-7440 or George J. Kelhart, Marketing Order

Administration Branch, Fruit and Vegetable Division, AMS, USDA, Room

2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: (202)

690-3919, 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,

Room 2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone:

(202) 720-2491, Fax: (202) 720-5698.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing

Agreements and Order No. 922 (7 CFR 922), regulating the handling of

apricots grown in designated counties in Washington; Marketing Order

No. 923 (7 CFR 923) regulating the handling of sweet cherries grown in

designated counties in Washington; and Marketing Order No. 924 (7 CFR

924) regulating the handling of fresh prunes grown in designated

counties in Washington and Umatilla County, Oregon, hereinafter

referred to as the ``orders.'' The marketing agreements and orders are

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. Under the marketing orders now in effect, handlers in

the designated areas are subject to assessments. Funds to administer

the orders are derived from such assessments. It is intended that the

assessment rates as issued herein will be applicable to all assessable

Washington apricots, Washington sweet cherries, and Washington-Oregon

fresh prunes beginning April 1, 1997, 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.

This rule decreases the assessment rates established for the

Committees for the 1997-98 and subsequent fiscal periods from $3.00 to

$2.00 per ton for Washington apricots, from $1.00 to $0.75 per ton for

Washington sweet cherries, and from $1.00 to $0.75 per ton for

Washington-Oregon fresh prunes.

The orders provide authority for the Committees, with the approval

of the Department, to formulate an annual budget of expenses and

collect assessments from handlers to administer the programs. The

members of the Committees are producers and handlers in designated

counties in Washington and in Umatilla County, Oregon. They are

familiar with the Committees' needs and with the costs for goods and

services in their local area and are thus in a position to formulate

appropriate budgets and assessment rates. The assessment rates are

formulated and discussed in public meetings. Thus, all directly

affected persons have an opportunity to participate and provide input.

For the 1996-97 and subsequent fiscal periods, the Committees

recommended, and the Department approved, an assessment rate that would

continue in effect from fiscal period to fiscal period

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indefinitely unless modified, suspended, or terminated by the Secretary

upon recommendation and information submitted by the Committee or other

information available to the Secretary.

The Washington Apricot Marketing Committee met on May 13, 1997, and

unanimously recommended 1997-98 expenditures of $9,917 and an

assessment rate of $2.00 per ton of apricots. In comparison, last

year's budgeted expenditures were $9,385. The assessment rate of $2.00

is $1.00 less than the rate currently in effect. At the current rate of

$3.00 per ton and an estimated 1997 fresh apricot production of 5,300

tons, the projected reserve on March 31, 1998, would exceed the maximum

level authorized by the order of one fiscal period's operational

expenses. The Committee discussed assessment rates of $1.00 and $1.50,

but decided that an assessment rate of less than $2.00 would not

generate the income necessary to administer the program with an

adequate reserve.

The assessment rate recommended by the committee was derived by

dividing anticipated expenses by expected shipments of apricots grown

in designated counties in Washington. Applying the $2.00 per ton rate

of assessment to the Committee's 5,300 ton shipment estimate should

provide $10,600 in assessment income. Income derived from handler

assessments, along with interest income and funds from the Committee's

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

in the reserve will be kept withint he maximum permitted by the order.

The Washington Cherry Marketing Committee met on May 12, 1997, and

unanimously recommended 1997-98 expenditures of $57,545 and an

assessment rate of $0.75 per ton of cherries. In comparison, Last

year's budgeted expenditures were $56,665. The assessment rate of $0.75

is $0.25 less than the rate currently in effect. At the current rate of

$1.00 perton and an estimated 1997 sweet cherry production of 54,000

tons, the projected reserve on March 31, 1998, would exceed the maximum

level authorized by the order of one fiscal period's operational

expenses. The Committee discussed an assessment rate of $0.50, but

decided that an assessment rate of less than $0.75 would not generate

the income necessary to administer the program with an adequate

reserve.

The assessment rate recommended by the Committee was derived by

dividing anticipated expenses by expected shipments of sweet cherries

grown in designated counties in Washington. With cherry shipments for

the year estimated at 54,000 tons, the assessment rate of $0.75 should

provide $40,500 in assessment income. Income derived from handler

assessments, along with interest income and funds from the Committee's

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

in the reserve will be kept within the maximum permitted by the order.

The Oregon-Washington Fresh Prune Marketing Committee met on May

28, 1997, and unanimously recommended 1997-98 expenditures of $7,233

and an assessment rate of $0.75 per ton of prunes. In comparison, last

year's budgeted expenditures were $6,645. The assessment rate of $0.75

is $0.25 less than the rate currently in effect. At the current rate of

$1.00 per ton and an estimated 1997 fresh prune production of 6,000

tons, the projected reserve on March 31, 1998, would exceed the maximum

level authorized by the order of one fiscal period's operational

expenses. The Committee discussed an assessment rate of $0.50, but

decided that an assessment rate of less than $0.75 would not generate

the income necessary to administer the program with an adequate

reserve.

The assessment rate recommended by the Committee was derived by

dividing anticipated expenses by expected shipments of fresh prunes

grown in designated counties in Washington, and Umatilla County,

Oregon. With fresh prune shipments for the year estimated at 6,000

tons, the $0.75 per ton assessment rate should provide $4,500 in

assessment income. Income derived from handler assessments, along with

interest income and funds from the Committee's authorized reserve, will

be adequate to cover budgeted expenses. Funds in the reserve will be

kept within the maximum permitted by the order.

Major expenses recommended by the Committees for the 1997-98 year

include manager's salary, office rent and maintenance, Committee

travel, and compliance officer.

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

Committee or other available information.

Although this assessment rate is effective for an indefinite

period, the Committee will continue to meet prior to or during each

fiscal period to recommend a budget of expenses and consider

recommendations for modification of the assessment rate. The dates and

times of Committee meetings are available from the Committee or the

Department. Committee meetings are open to the public and interested

persons may express their views at these meetings. The Department will

evaluate Committee recommendations and other available information to

determine whether modification of the assessment rate is needed.

Further rulemaking will be undertake as necessary. The Committee's

1997-98 budget and those for subsequent fiscal periods will be reviewed

and, as appropriate, approved by the Department.

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. 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 190 Washington apricot producers, 1,100

Washington sweet cherry producers, and 350 Washington-Oregon fresh

prune producers in the respective production areas. In addition, there

are approximately 55 Washington apricot handlers, 55 Washington sweet

cherry handlers, and 30 Washington-Oregon fresh prune handlers subject

to regulation under the respective marketing orders. Small agricultural

producers have been defined by the Small Business Administration (13

CFR 121.601) as those having annual receipts 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 Washington apricot,

Washington sweet cherry, and Washington-Oregon fresh prune producers

and handlers may be classified as small entities.

This rule decreases the assessment rates established for the

Committees and collected from handlers for the 1997-98 and subsequent

fiscal periods. The Committees unanimously recommended 1997-98

expenditures of $9,917 for apricots, $57,545 for cherries, and $7,233

for prunes and an assessment rate of $2.00 per ton of apricots, $0.75

per ton for cherries, and $0.75 per ton for prunes. The assessment rate

of $2.00 for apricots is $1.00 less than the rate currently in effect.

The assessment rates of $0.75 for cherries and prunes are

[[Page 41807]]

$0.25 less than the rates currently in effect. At current assessment

rates, the Committees' reserves were projected to exceed the amount

authorized in the orders of approximately one fiscal period's

operational expenses. Therefore, the Committees voted to lower their

respective assessment rates and use more of their reserves to cover

expenses.

The Committees discussed alternatives to this rule, including

alternative expenditure levels. Lower assessment rates were considered,

but not recommended because they would not generate the income

necessary to administer the programs with adequate reserves. Major

expenses recommended by the Committees for the 1997-98 year include

manager's salary, office rent and maintenance, Committee travel, and

compliance officer.

Apricot shipments for 1997 are estimated at 5,300 tons, which

should provide $10,600 in assessment income. Income derived from

handler assessments, along with funds from the authorized reserve will

be adequate to cover budgeted expenses. Funds in the reserve will be

kept within the maximum permitted by the order.

Sweet cherry shipments for 1997 are estimated at 54,000 tons, which

should provide $40,500 in assessment income. Income derived from

handler assessments, along with funds from the authorized reserve will

be adequate to cover budgeted expenses. Funds in the reserve will be

kept within the maximum permitted by the order.

Fresh prune shipments for 1997 are estimated at 6,000 tons, which

should provide $4,500 in assessment income. Income derived from handler

assessments, along with funds from the authorized reserve will be

adequate to cover budgeted expenses. Funds in the reserve will be kept

within the maximum permitted by the order.

Recent price information indicates that the grower price for the

1997-98 season will range between $600 and $1,400 per ton for

Washington apricots, between $1,500 and $2,200 per ton for Washington

sweet cherries, and between $200 and $500 per ton for Washington-Oregon

fresh prunes. Therefore, the estimated assessment revenue for the 1997-

98 fiscal period as a percentage of total grower revenue will range

between 0.14 and 0.33 percent for Washington apricots, between 0.03 and

0.05 percent for Washington sweet cherries, and between 0.15 and 0.38

percent for Washington-Oregon fresh prunes.

This action will reduce the assessment obligation imposed on

handlers. While this rule will impose some additional costs on

handlers, the costs are minimal and 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 orders. In addition, the Committees'

meetings were widely publicized throughout the Washington apricot,

Washington sweet cherry, and Washington-Oregon fresh prune industries

and all interested persons were invited to attend and participate in

the Committees' deliberations on all issues. Like all meetings of these

Committees, the May 12, 13, and 28 meetings were public meetings and

all entities, both large and small, were able to express views on this

issue. Finally, interested persons are invited to submit information on

the regulatory and informational impacts of this action on small

businesses.

This action will not impose any additional reporting or

recordkeeping requirements on either small or large Washington apricot,

Washington sweet cherry, or Washington-Oregon fresh prune handlers. 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.

The Department has not identified any relevant Federal rules that

duplicate, overlap, or conflict with this rule. After consideration of

all relevant material presented, including the information and

recommendations submitted by the Committees 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 rule until 30 days after publication in the Federal

Register because: (1) This action reduces the current assessment rates

for Washington apricots and cherries, and Washington-Oregon fresh

prunes; (2) the 1997-98 fiscal period began on April 1, and the

marketing orders require that the rate of assessment for each fiscal

period apply to all assessable Washington apricots, Washington sweet

cherries, and Washington-Oregon fresh prunes handled during such fiscal

period; (3) handlers are aware of this action which was unanimously

recommended by the Committees at public meetings and is similar to

other assessment rate actions issued in past years; 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

7 CFR Part 922

Apricots, Marketing agreements, Reporting and recordkeeping

requirements.

7 CFR Part 923

Cherries, Marketing agreements, Reporting and recordkeeping

requirements.

7 CFR Part 924

Plums, Prunes, Marketing agreements, Reporting and recordkeeping

requirements.

For the reasons set forth in the preamble, 7 CFR parts 922, 923,

and 924 are amended as follows:

1. The authority citation for 7 CFR parts 922, 923, and 924

continue to read as follows:

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

PART 922--APRICOTS GROWN IN DESIGNATED COUNTIES IN WASHINGTON

2. Section 922.235 is amended by removing ``April 1, 1996,'' and

adding in its place ``April 1, 1997,'' and by removing ``$3.00'' and

adding in its place ``$2.00.''

PART 923--SWEET CHERRIES GROWN IN DESIGNATED COUNTIES IN WASHINGTON

3. Section 923.236 is amended by removing ``April 1, 1996,'' and

adding in its place ``April 1, 1997,'' and by removing ``$1.00'' and

adding in its place ``$0.75.''

PART 924--FRESH PRUNES GROWN IN DESIGNATED COUNTIES IN WASHINGTON

AND IN UMATILLA COUNTY, OREGON

4. Section 924.236 is amended by removing ``April 1, 1996,'' and

adding in its place ``April 1, 1997,'' and by removing ``$1.00'' and

adding in its place ``$0.75.''

Dated: July 29, 1997.

Ronald L. Cioffi,

Acting Director, Fruit and Vegetable Division.

[FR Doc. 97-20459 Filed 8-1-97; 8:45 am]

BILLING CODE 3410-02-P