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 FIR]

Reduced Assessment Rates for Specified Marketing Orders

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

which decreased the assessment rates established for the Washington

Apricot Marketing Committee, Washington Cherry Marketing Committee, and

Washington-Oregon Fresh Prune Committee (Committees) under Marketing

Orders Nos. 922, 923, and 924 for the 1997-98, and subsequent fiscal

periods. Authorization to assess apricot, cherry, and prune handlers

enables the Committees to incur expenses that are reasonable and

necessary to administer the program. The 1997-98 fiscal periods for

these marketing orders began April 1 and end March 31. The assessment

rates will continue in effect indefinitely unless modified, suspended,

or terminated.

EFFECTIVE DATE: December 8, 1997.

FOR FURTHER INFORMATION CONTACT: Jadean L. Williams, Northwest

Marketing Field Office, Fruit and Vegetable Programs, 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 Programs, AMS, USDA, Room

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

720-2491, 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 Programs, 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 part 922), regulating the handling

of apricots grown in designated counties in Washington; Marketing Order

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

grown in designated counties in Washington; and Marketing Order No. 924

(7 CFR part 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 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

[[Page 60159]]

petition, provided an action is filed not later than 20 days after the

date of the entry of the ruling.

This rule continues in effect the assessment rates established for

the Committees for the 1997-98 and subsequent fiscal periods of $2.00

per ton for Washington apricots, and $0.75 per ton for Washington sweet

cherries and Washington-Oregon fresh prunes.

The orders provide authority for each of 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, assessment rates that would

continue in effect from fiscal period to fiscal period indefinitely

unless modified, suspended, or terminated by the Secretary upon

recommendation and information submitted by the Committees 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 previously in effect. At the former 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 within the 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 previously in effect. At the former rate of

$1.00 per ton 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 previously in effect. At the former 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 rates established in this rule will continue in

effect indefinitely unless modified, suspended, or terminated by the

Secretary upon recommendation and information submitted by the

Committees or other available information.

Although these assessment rates are effective for an indefinite

period, the Committees 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 rates. The dates and

times of Committee meetings are available from the Committees 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 rates is needed.

Further rulemaking will be undertaken as necessary. The Committees'

1997-98 budgets 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 final 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,

[[Page 60160]]

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 continues in effect decreased 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

for 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

previously in effect. The assessment rates of $0.75 for cherries and

prunes are $0.25 less than the rates previously in effect. At the

former 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 producer 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

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 the

issues.

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 final rule.

The interim final rule published in the Federal Register (62 FR

41805) on August 4, 1997, requested comments to be received by

September 3, 1997. A copy of the interim final rule was also made

available on the Internet by the U.S. Government Printing Office. No

comments were received.

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.

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.

PART 922--APRICOTS GROWN IN DESIGNATED COUNTIES IN WASHINGTON

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

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

AND IN UMATILLA COUNTY, OREGON

Accordingly, the interim final rule amending 7 CFR parts 922, 923,

and 924 which was published at 62 FR 41805 on August 4, 1997, is

adopted as a final rule without change.

Dated: November 3, 1997.

Robert C. Keeney,

Deputy Administrator, Fruit and Vegetable Programs.

[FR Doc. 97-29478 Filed 11-6-97; 8:45 am]

BILLING CODE 3410-02-P