[Federal Register Volume 62, Number 144 (Monday, July 28, 1997)]
[Rules and Regulations]
[Pages 40255-40257]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-19705]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1208
[FV-97-703]
Fresh Cut Flowers and Fresh Cut Greens Promotion and Information
Order
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: This document removes the requirement of the Fresh Cut Flowers
and Fresh Cut Greens Promotion and Information Order (Order) that each
qualified handler pays to the National PromoFlor Council (Council) an
assessment in the amount of 0.5 percent on wholesale sales of fresh cut
flowers and greens as specified in the Order. The remaining provisions
of the Order and regulations issued thereunder will be terminated at a
later date. This action is necessary because termination of the Order
was favored by a majority of the qualified handlers voting in a
referendum conducted from June 2 through 20, 1997.
EFFECTIVE DATE: July 29, 1997.
FOR FURTHER INFORMATION: Sonia N. Jimenez, Research and Promotion
Branch, Fruit and Vegetable Division, AMS, USDA, P.O. Box 96456, Room
2535-S, Washington, DC 20090-6456, telephone (202) 720-9915 or (888)
720-9917.
SUPPLEMENTARY INFORMATION: This action is issued under the Fresh Cut
Flowers and Fresh Cut Greens Promotion and Information Act of 1993 [7
U.S.C. 6801-6814] (Act).
Prior documents in this proceeding: Fresh Cut Flowers and Fresh Cut
Greens Promotion and Information Order, December 29, 1994 [59 FR
67139]; Referendum Procedures, April 14, 1997 [62 FR 18033]; and
Referendum Order, April 21, 1997 [62 FR 19301].
This action has been determined to be non-significant for purposes
of Executive Order 12866 and therefore has not been reviewed by OMB.
This action has been reviewed under Executive Order 12988, Civil
Justice Reform. It is not intended to have retroactive effect. This
action will not preempt any State or local laws, regulations, or
policies, unless they present an irreconcilable conflict with this
termination order.
Regulatory Flexibility Analysis
In accordance with the Regulatory Flexibility Act [5 U.S.C. 601 et
seq.] (RFA), the Agricultural Marketing Service has considered the
economic impact of this action on small entities.
The Act, which authorizes the creation of a generic program of
promotion and information for fresh cut flowers and greens, became
effective on December 14, 1993.
Section 7(a) of the Act provides that the Secretary of Agriculture
(Secretary) shall conduct a referendum not later than 3 years after the
issuance of an order to ascertain whether the order then in effect
shall be continued. The Order was issued on December 29, 1994.
Paragraph (a)(2) of Sec. 7 of the Act requires that the Order be
approved by a simple majority of all votes cast in the referendum. In
addition, paragraph (b) of Sec. 7 of the Act specifies that each
qualified handler eligible to vote in the referendum shall be entitled
to cast one vote for each separate facility of the person that is an
eligible separate facility. The voting period for the referendum was
June 2 through 20, 1997.
Only those wholesale handlers (including, but not limited to,
wholesale jobbers, bouquet and floral article manufacturers, auction
houses that clear the sale of cut flowers and greens, and retail
distribution centers), producers, and importers who have annual sales
of $750,000 or more of fresh cut flowers and greens and who sell those
products to exempt handlers, retailers, or consumers are considered
qualified handlers and assessed under the Order.
There are approximately 643 qualified handlers who are covered by
the program. Small agricultural service firms, which include the
qualified handlers covered under the Order, have been defined by the
Small Business Administration [13 CFR 121.601] as those whose annual
receipts are less than $5 million. Only 127 qualified handlers have
been identified to have $5 million in annual sales.
It is concluded that the majority of qualified handlers may be
classified as small entities.
[[Page 40256]]
This action terminates the requirements of the Order for qualified
handlers to remit assessments.
Currently, an estimated 643 qualified handlers pay about $10
million annually. When the Order was published in the Federal Register
on December 29, 1994, the U.S. Department of Agriculture (USDA) stated
that, with regard to the RFA, although the maximum assessment
collection was expected to total about $10 million annually, the
economic impact of a 1.0 percent or less assessment on each qualified
handler would not be significant. This holds true today with the
current 0.5 percent assessment rate. Under this termination order,
qualified handlers would no longer be required to pay assessments.
Statistics reported by the National Agricultural Statistics Service
show that in 1995 sales of domestic cut flowers and cut greens totaled
approximately $521.3 million at the wholesale level. The leading
producing states by wholesale value are California, with about 49
percent of the total of flower and cut green production, followed by
Florida, Colorado and Hawaii. Sales information for 1996 will not be
available until after publication of this rule.
The value of imports of cut flowers in 1996 was $557.7 million.
Major countries exporting cut flowers to the United States, by value,
are Colombia which accounts for about 66 percent of the value, followed
by the Netherlands (10 percent), Ecuador (12 percent), Costa Rica (3
percent), and Mexico (3 percent).
The Act and Order also provide for refunds of assessments, under
certain conditions, for those handlers who requested the refund before
the initial referendum was held, and if the Order is rejected by voters
in the referendum.
Therefore, the exact impact of this action will vary according to
the amount of assessments handlers have been remitting and would remit
under the Order and whether such handlers requested a refund.
This action will not impose any additional reporting or
recordkeeping requirements on either large or small qualified handlers
of cut flowers and greens.
The Department has not identified any relevant Federal rules that
duplicate, overlap, or conflict with this rule.
Background
This action terminates Order requirements to pay assessments and is
governed by Sec. 7(d) of the Act. The Act authorizes a national fresh
cut flowers and greens promotion, research, and information program,
also known as PromoFlor. In accordance with the Act, USDA developed and
implemented the Order [7 CFR 1208.1-1208.85], which became effective on
December 29, 1994.
Section 7(a) of the Act requires that the Secretary conduct a
referendum not later than 3 years after issuance of an order to
determine whether qualified handlers favor continuation of the order.
The order directing that a referendum be conducted was published in the
Federal Register on April 21, 1997 [62 FR 19301]. The representative
period for establishing voter eligibility for the referendum was the
period from January 1, 1996, through December 31, 1996. A referendum
was conducted by mail ballot from July 2 through 20, 1997. Termination
of the Order was favored by 58 percent of the qualified handlers
casting valid ballots in the referendum.
Therefore, pursuant to Sec. 7(d) of the Act and Sec. 1208.60 of the
Order, it is hereby found and determined that termination of the Order
is favored by a majority of the qualified handlers voting in the
referendum and that the Order should therefore be terminated.
Section 7(d) of the Act provides that, if the Secretary determines
that termination of the Order is favored by a majority of all votes
cast in the referendum, the Secretary shall terminate, as appropriate
the collection of assessments under the Order not later than 180 days
after the referendum results are announced. Further, the Secretary is
required to terminate, as appropriate, activities under the Order as
soon as practicable and in an orderly manner. A separate order will be
published in the Federal Register terminating the remaining Order
requirements and provisions.
In accordance with Sec. 1208.61, the Council will recommend not
more than five of its members to the Secretary to serve as trustees for
purposes of liquidating the assets of the Council.
Termination of the Order and any of its provisions, including the
requirements to remit assessments, shall not:
(a) Affect or waive any right, duty, obligation, or liability which
shall have arisen or which may thereafter arise in connection with any
provision of the Order; or
(b) Release or extinguish any violation of this Order; or
(c) Affect or impair any rights or remedies of the United States,
or of the Secretary, or of any other person with respect to any such
violation.
Section 5(h)(4) of the Act [7 U.S.C. 6804(h)(4)] provides that
refunds of assessments shall be made out of the escrow account to those
qualified handlers who applied for such refunds prior to the conduct of
the referendum and submitted satisfactory proof that they paid the
assessment for which refund is requested. If the amount in the escrow
account is not sufficient to refund the total amount of assessments
demanded, the amount of all such refunds shall be prorated among all
eligible qualified handlers that demand the refunds. Section 1208.61 of
the Order provides that refunds are to be made within 30 days of the
date the results of the referendum are released by the Secretary.
Order
It is therefore ordered, That the terms and provisions of Subpart A
of the Order requiring fresh cut flowers and greens qualified handlers
to pay an assessment used to finance the national program for fresh cut
flowers and fresh cut greens promotion and information [7 CFR Part
1208] are hereby terminated.
It is also found and determined upon good cause that it is
impracticable, unnecessary, and contrary to the public interest to give
preliminary notice or to engage in further public procedure prior to
putting this action 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) This action terminates
the requirements of the Order that each qualified handler remit
assessments; (2) termination of the Order was favored by a majority of
qualified handlers voting in the referendum; and (3) the Act requires
that, upon such a determination by referendum, collection of
assessments should terminate no later than 180 days after the
referendum.
List of Subjects in 7 CFR Part 1208
Administrative practice and procedure, Advertising, Consumer
information, Marketing agreements, Plants, Promotion, Reporting and
recordkeeping requirements.
PART 1208--FRESH CUT FLOWERS AND FRESH CUT GREENS PROMOTION AND
INFORMATION ORDER
Subpart A--Fresh Cut Flowers and Fresh Cut Greens Promotion and
Information Order
1. The authority citation for 7 CFR Part 1208 continues to read as
follows:
Authority: 7 U.S.C. 6801 et seq.
2. A note is added to Sec. 1208.50 to read as follows:
[[Page 40257]]
Sec. 1208.50 Assessments.
* * * * *
Note to Sec. 1208.50: The requirement to pay assessments is
terminated as of July 29, 1997.
Dated: July 22, 1997.
Lon Hatamiya,
Administrator Agricultural Marketing Service.
[FR Doc. 97-19705 Filed 7-25-97; 8:45 am]
BILLING CODE 3410-02-P