Fresh Prunes Grown in Designated Counties in Washington and Umatilla County, Oregon; Increased Assessment Rate

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 924

[Docket No. FV99-924-1 PR]

Fresh Prunes Grown in Designated Counties in Washington and

Umatilla County, Oregon; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule would increase the assessment rate from $1.00 to

$1.50 per ton of fresh prunes established for the Washington-Oregon

Fresh Prune Marketing Committee (Committee) under Marketing Order No.

924 for the 1999-2000 and subsequent fiscal periods. The Committee is

responsible for local administration of the marketing order which

regulates the handling of fresh prunes grown in designated counties in

Washington and Umatilla County, Oregon. Authorization to assess fresh

prune handlers enables the Committee to incur expenses that are

reasonable and necessary to administer the program. The 1999-2000

fiscal period began April 1 and ends March 31. The assessment rate

would remain in effect indefinitely unless modified, suspended, or

terminated.

DATES: Comments must be received by August 13, 1999.

ADDRESSES: Interested persons are invited to submit written comments

concerning this rule. Comments must be sent to the Docket Clerk, Fruit

and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456,

Washington, DC 20090-6456; Fax (202) 720-5698; or E-mail:

[email protected]. 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 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 complying with this regulation, or obtain a guide on complying with

fruit, vegetable, and specialty crop marketing agreements and orders 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, or E-mail: Jay.G[email protected]. You may view the marketing

agreement and order small business compliance guide at the following

web site: http://www.ams.usda.gov/fv/moab.html.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order

No. 924, as amended (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 ``order.'' The marketing 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. Under the marketing order now in effect, Washington-

Oregon fresh prune handlers are subject to assessments. Funds to

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

that the assessment rate as proposed herein would be applicable to all

assessable fresh prunes beginning April 1, 1999, and continue until

modified, 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

[[Page 37889]]

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

This rule would increase the assessment rate established for the

Committee for the 1999-2000 and subsequent fiscal periods from $1.00 to

$1.50 per ton of fresh prunes handled.

The Washington-Oregon fresh prune marketing order provides

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

formulate an annual budget of expenses and collect assessments from

handlers to administer the program. The Committee consists of six

producer members and three handler members, each of whom is familiar

with the Committee'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 budget and assessment rate were

discussed at a public meeting and all directly affected persons had an

opportunity to participate and provide input.

For the 1998-99 and subsequent fiscal periods, the Committee

recommended, and the Department approved, an assessment rate of $1.00

per ton 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

Committee or other information available to the Secretary.

The Committee met on May 27, 1999, and unanimously recommended

1999-2000 expenditures of $7,630 and an assessment rate of $1.50 per

ton of fresh prunes handled. In comparison, last year's budgeted

expenditures were $7,003. The assessment rate of $1.50 is $0.50 higher

than the rate currently in effect. The Committee recommended an

increased assessment rate because assessable 1999-2000 tonnage is

expected to be smaller than the 5-year average of 4,985 tons, and the

current rate would not generate enough income to adequately administer

the program. The Committee also plans on hiring an additional part-time

staff person which would increase its salary expense.

Major expenses recommended by the Committee for the 1999-2000

fiscal period include $3,560 for salaries, $1,000 for travel, $528 for

rent and maintenance, and $475 for its annual audit. Budgeted expenses

for these items in 1998-99 were $2,880, $1,000, $528, and $475,

respectively.

The assessment rate recommended by the Committee was derived by

dividing anticipated expenses by expected shipments of Washington-

Oregon fresh prunes. Fresh prune shipments for the year are estimated

at 4,600 tons, which should provide $6,900 in assessment income. Income

derived from handler assessments, along with funds from the Committee's

authorized reserve, should be adequate to cover budgeted expenses.

Funds in the reserve (currently $6,013) would be kept within the

maximum permitted by the order of approximately one fiscal period's

operational expenses (Sec. 924.42).

The proposed assessment rate would 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 would be in effect for an indefinite

period, the Committee would 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 would

evaluate Committee recommendations and other available information to

determine whether modification of the assessment rate is needed.

Further rulemaking would be undertaken as necessary. The Committee's

1999-2000 budget and those for subsequent fiscal periods would 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, the 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 100 producers of fresh prunes in the

production area and approximately 12 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 less than $500,000 and small agricultural

service firms are defined as those whose annual receipts are less than

$5,000,000.

Currently, all of the Washington-Oregon fresh prune handlers ship

under $5,000,000 worth of fresh prunes. In addition, based on acreage,

production, and producer prices reported by the National Agricultural

Statistics Service, and the total number of Washington-Oregon fresh

prune producers, the average annual producer revenue is approximately

$21,000. In view of the foregoing, it can be concluded that the

majority of Washington-Oregon fresh prune producers and handlers may be

classified as small entities.

This rule would increase the assessment rate established for the

Committee and collected from handlers for the 1999-2000 and subsequent

fiscal periods from $1.00 to $1.50 per ton of fresh prunes handled. The

Committee met on May 27, 1999, and unanimously recommended 1999-2000

expenditures of $7,630 and an assessment rate of $1.50 per ton of fresh

prunes handled. In comparison, last year's budgeted expenditures were

$7,003. The assessment rate of $1.50 is $0.50 more than the rate

currently in effect. The Committee recommended an increased assessment

rate because assessable 1999-2000 tonnage is expected to be smaller

than the 5-year average of 4,985 tons, and the current rate would not

generate enough income to adequately administer the program. The

Committee also plans on hiring an additional part-time staff person

which would increase its salary expense.

Major expenses recommended by the Committee for the 1999-2000

fiscal period include $3,560 for salaries, $1,000 for travel, $528 for

rent and maintenance, and $475 for its annual audit. Budgeted expenses

for these items in 1998-99 were $2,880, $1,000, $528, and $475,

respectively.

The assessment rate recommended by the Committee was derived by

dividing anticipated expenses by expected shipments of fresh prunes.

Fresh prune shipments for the year are estimated at 4,600 tons, which

should provide $6,900 in assessment income. Income derived from handler

assessments, along with funds from the Committee's authorized reserve,

should be adequate to cover budgeted expenses. The reserve is within

the maximum permitted by the order of approximately one fiscal period's

operational expenses (Sec. 924.42).

The Committee considered alternative levels of assessment but

determined that, with the reduced estimate of assessable tonnage,

increasing the assessment rate to $1.50 per ton would be appropriate.

The Committee decided that an assessment rate of more than

[[Page 37890]]

$1.50 per ton would generate income in excess of that needed to

adequately administer the program.

A review of historical information and preliminary information

pertaining to the upcoming crop indicates that the producer price for

the 1999-2000 marketing season could range between $200 and $500 per

ton of fresh prunes handled. Therefore, the estimated assessment

revenue for the 1999-2000 fiscal period as a percentage of total grower

revenue should range between 0.30 and 0.75 percent.

This action would increase the assessment obligation imposed on

handlers. While assessments impose some additional costs on handlers,

the costs are minimal and uniform on all handlers. Some of the

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

would be offset by the benefits derived by the operation of the

marketing order. In addition, the Committee's meeting was widely

publicized throughout the Washington-Oregon fresh prune industry and

all interested persons were invited to attend the meeting and

participate in Committee deliberations on all issues. Like all

Committee meetings, the May 27, 1999, meeting was a public meeting 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 proposed rule would impose no additional reporting or

recordkeeping requirements on either small or large 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.

A 30-day comment period is provided to allow interested persons the

opportunity to respond to this proposed rule. Thirty days is deemed

appropriate because: (1) The 1999-2000 fiscal period began on April 1,

1999, and the order requires that the rate of assessment for each

fiscal period apply to all assessable fresh prunes handled during such

fiscal period; (2) the Committee needs to have sufficient funds to pay

its expenses which are incurred on a continuous basis; and (3) handlers

are aware of this action which was unanimously recommended by the

Committee at a public meeting and is similar to other assessment rate

actions issued in past years.

List of Subjects in 7 CFR Part 924

Marketing agreements, Plums, Prunes, Reporting and recordkeeping

requirements.

For the reasons set forth in the preamble, 7 CFR part 924 is

proposed to be amended as follows:

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

AND UMATILLA COUNTY, OREGON

1. The authority citation for 7 CFR part 924 continues to read as

follows:

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

2. Section 924.236 is revised to read as follows:

Sec. 924.236 Assessment rate.

On and after April 1, 1999, an assessment rate of $1.50 per ton is

established for the Washington-Oregon Fresh Prune Marketing Committee.

Dated: July 7, 1999.

Robert C. Keeney,

Deputy Administrator, Fruit and Vegetable Programs.

[FR Doc. 99-17891 Filed 7-13-99; 8:45 am]

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